Document:

QuickLinks
 -- Click here to rapidly navigate through this document

 
 

Exhibit 10.8    
  

EXECUTION COPY  

 GUARANTEE AND AGREEMENT

(TURBINE CREDIT AGREEMENT)  

 made by  

 PG&E NATIONAL ENERGY GROUP, INC.  

 in favor of  

 SOCIÉTÉ GÉNÉRALE,

as Security Agent  

 Dated as of May 29, 2001  

TABLE OF CONTENTS  

	 
	 	 
	 	Page

	SECTION I        DEFINED TERMS	 	1
	 	

1.01.	
 	

Definitions	
 	

1
	 	1.02.	 	Other Definitional Provisions	 	15
	

SECTION II        GUARANTEE	
 	

16
	 	

2.01.	
 	

Guarantee; Payment	
 	

16
	 	2.02.	 	Extent of Liability	 	16
	 	2.03.	 	Nature of Guarantee	 	16
	 	2.04.	 	Demands and Notice; Application of Proceeds	 	16
	 	2.05.	 	Consent to Modifications, Waivers	 	17
	 	2.06.	 	Subrogation	 	17
	 	2.07.	 	Substitute Credit Support	 	17
	

SECTION III        REPRESENTATIONS AND WARRANTIES	
 	

18
	 	

3.01.	
 	

Organization; Powers; Ownership of Property	
 	

18
	 	3.02.	 	Authorization	 	18
	 	3.03.	 	Enforceability	 	18
	 	3.04.	 	Financial Statements	 	19
	 	3.05.	 	Litigation	 	19
	 	3.06.	 	Federal Reserve Regulations	 	19
	 	3.07.	 	Investment Company Act; Public Utility Holding Company Act	 	19
	 	3.08.	 	No Material Misstatements	 	19
	 	3.09.	 	Taxes	 	19
	 	3.10.	 	Employee Benefit Plans	 	20
	 	3.11.	 	Governmental Approval; Compliance with Law and Contracts	 	20
	 	3.12.	 	Environmental Matters	 	20
	 	3.13.	 	Ranking	 	20
	 	3.14.	 	Unrestricted Subsidiaries	 	20
	 	3.15.	 	Separateness from PG&E	 	21
	

SECTION IV        COVENANTS	
 	

21
	 	

4.01.	
 	

Maintenance of Ownership	
 	

21
	 	4.02.	 	Existence	 	21
	 	4.03.	 	Compliance with Law; Business and Properties	 	21
	 	4.04.	 	Financial Statements, Reports, Etc.	 	22
	 	4.05.	 	Insurance	 	23
	 	4.06.	 	Taxes, Etc.	 	23
	 	4.07.	 	Maintaining Records; Access to Properties and Inspections	 	23
	 	4.08.	 	Risk Management Procedures	 	23
	 	4.09.	 	Merger	 	23
	 	4.10.	 	Investments	 	23
	 	4.11.	 	Liens	 	24
	 	4.12.	 	Indebtedness	 	25
	 	4.13.	 	Transactions with Affiliates	 	27
	 	4.14.	 	Distributions	 	27
	 	4.15.	 	Financial Covenants	 	27
	 	4.16.	 	Separateness from PG&E Corp	 	28
	 	4.17.	 	PG&E Gen Credit Agreement Covenants	 	28
	

SECTION V        NEG TRIGGER EVENTS	
 	

287

	 	

5.01.	
 	

NEG Trigger Events	
 	

28
	

SECTION VI        MISCELLANEOUS	
 	

29
	 	6.01.	 	Amendments	 	29
	 	6.02.	 	Successors and Assigns	 	29
	 	6.03.	 	GOVERNING LAW	 	29
	 	6.04.	 	No Waiver, Cumulative Remedies	 	29
	 	6.05.	 	Authority and Rights of Security Agent	 	29

Schedules  

	1.01A	 	Existing Sale-Leaseback Transactions
	1.01B	 	Terms and Conditions of Subordination for Indebtedness to Affiliates
	1.01C	 	Terms and Conditions of Subordination for Indebtedness to Non-Affiliates
	3.05	 	Litigation
	3.12	 	Environmental Matters
	3.14	 	Unrestricted Subsidiaries
	4.01	 	Certain Restricted Subsidiaries not Subject to Sections 4.01 or 4.02
	4.10	 	Other Existing Investments
	4.11	 	Other Existing Liens
	4.12(a)	 	Indebtedness under Certain Credit Agreements
	4.12(f)	 	Other Existing Indebtedness
	4.13	 	Description of Existing Management, Operation, Sharing and Similar Arrangements with Affiliates

Exhibits  

	A	 	Form of Payment Demand

GUARANTEE AND AGREEMENT  

        GUARANTEE AND AGREEMENT dated as of May 29, 2001 (this "Guarantee and Agreement") by PG&E NATIONAL ENERGY
GROUP, INC., a Delaware corporation (this "Guarantor"), in favor of SOCIÉTÉ GÉNÉRALE,
as security agent (in such capacity the "Security Agent") for the Lenders from time to time parties to the Credit Agreement, dated as of May 29,
2001 (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement"), among PG&E NATIONAL ENERGY GROUP CONSTRUCTION COMPANY,
LLC (the "Company"), the Lenders and Société Générale, as Administrative Agent and Security
Agent. 

W I T N E S S E T H  

        WHEREAS, pursuant to the Credit Agreement, the Lenders have agreed to make Loans to the Company upon the terms and subject to the conditions set forth therein; 

        WHEREAS,
it is a condition precedent to the obligation of the Lenders to make Loans to the Company under the Credit Agreement that the Guarantor shall have executed and delivered this
Guarantee and Agreement to the Security Agent for the ratable benefit of the Lenders; 

        WHEREAS,
the Guarantor owns directly or indirectly all of the membership interests in the Company, and the Guarantor will derive substantial direct and indirect benefit from the making
of the Loans under the Credit Agreement; 

        NOW,
THEREFORE, in consideration of the Security Agent and the Lenders entering into transactions with the Company under the Loan Documents, the Guarantor agrees as follows: 

SECTION I DEFINED TERMS  

        1.01.    Definitions.    (a) Unless otherwise defined herein, capitalized terms used herein shall have the
meanings given to them in the Credit Agreement. 

        (b)  The
following terms shall have the following meanings: 

        "$1.1 Billion PG&E Gen Credit Agreement" shall mean the $1,100,000,000 Credit Agreement, dated as of September 1, 1998, as amended
as of the date hereof, among PG&E Gen and the lenders party thereto. 

        "Actual Knowledge" shall mean, with respect to any Person as to any event or circumstance, the actual knowledge of the Responsible Officer
of such Person or receipt by such Person from the Administrative Agent or Security Agent, as the case may be, of notice of such event or circumstance. 

        "Affiliate" shall mean, when used with respect to a specified Person, another Person that directly or indirectly controls or is controlled
by or is under common control with the Person specified. For this purpose, "control" of a Person shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through ownership of voting shares, by contract or otherwise. 

        "Asset Company" shall mean any entity (a) (i) whose principal purpose is the acquisition, improvement, installation, design,
engineering, construction, development, completion, financing, maintenance or operation of all or any part of a project or projects, or any asset related thereto, used in the business of generating,
transmitting, transporting, distributing, producing or storing electric power, thermal energy, natural gas or other fuel or other energy-related businesses and (ii) substantially all its assets
are limited to those assets being financed (or to be financed), or the operation of which is being financed (or to be financed), in whole or in part by a Project Financing Facility entered into by
such entity and/or any Investment Vehicle that owns such entity or by contributions or intercompany loans from the Guarantor, any Restricted Subsidiary or any such Investment Vehicle or
(b) which entity is a Subsidiary of an entity described in clause (a) and the business and assets of which are related to the business of such entity and which does not incur 

 

any Indebtedness other than (A) intercompany loans from an Asset Company which is the parent of such Subsidiary, the Guarantor, any Restricted Subsidiary or any Investment Vehicle that
indirectly owns such Subsidiary, (B) Indebtedness of the type described in Section 4.12(i) or (C) Indebtedness under a Project Financing Facility. 

        "Business Day" shall mean any day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or
required by law to close. 

        "Cash Equivalents" shall mean (a) any evidence of indebtedness with a maturity of 180 days or less issued or directly and
fully guaranteed or insured by the United States, Canada or any U.S. agency or instrumentality; (b) certificates of deposit or acceptances or Eurodollar time deposits with a maturity of
180 days or less of, and overnight bank deposits and demand accounts with (i) any financial institution that is not a foreign bank or a foreign bank holding company that has a bankwatch
rating of at least B/C by Fitch and a commercial paper rating of at least A-1 by S&P, F1 by Fitch or P-1 by Moody's or (ii) any financial institution that is a foreign
bank or a foreign bank holding company that has a sovereign risk rating of at least AA by Fitch, a bankwatch rating of at least B by Fitch, a commercial paper rating of at least A-1 by
S&P, F1 by Fitch or P-1 by Moody's and a minimum of US$20 billion in assets; (c) commercial paper with a maturity of 180 days or less issued by a U.S. or Canadian
incorporated company that is not an Affiliate of the Guarantor and rated at least A-1 by S&P, F1 by Fitch or at least P-1 by Moody's; (d) Repurchase Agreements with a
maturity of 90 days or less made with banks which meet the criteria in clause (b) above and primary government security dealers (as defined by the Federal Reserve System) which meet the
criteria in clause (c) above, and are fully collateralized by investments meeting the criteria of clause (a) above; (e) tax-exempt municipal obligations of any state
of the United States, or any municipality of any such state which mature within 180 days from the date of acquisition thereof and which, in each case, are rated at least MIG-1 or
VMIG-1 by Moody's, and SP-1/A-1 or AA/A-1 by S&P; and (f) institutional money market funds that exclusively invest in any of the foregoing. 

        "Cash Flow Available for Fixed Charges" for any period shall mean, without duplication, (i) EBITDA of the Guarantor and its
Consolidated Subsidiaries which are not Unrestricted Subsidiaries for such period, minus (ii) EBITDA for such period of such Consolidated
Subsidiaries that are financed with Indebtedness of such Subsidiary or which are direct or indirect Subsidiaries of a Financed Subsidiary of the Guarantor,  plus (iii) Distributions received by the
Guarantor from Subsidiaries described in the foregoing clause (ii) during such period except to
the extent the amount of such Distributions previously constituted "Cash Flow Available for Fixed Charges" during such period as a result of clause (viii) below,  minus (iv) Distributions
described in the foregoing clause (iii) that are attributable to extraordinary gains or other
non-recurring items described in clause (iii) of the definition of "EBITDA", minus (v) any income reported by the Guarantor
for such period for Persons that are not Consolidated Subsidiaries of the Guarantor, plus (vi) Distributions received by the Guarantor from
Persons described in the foregoing clause (v) during such period, minus (vii) Distributions described in the foregoing clause (vi)
that are attributable to extraordinary gains or other non-recurring items described in clause (iii) of the definition of "EBITDA", plus,  (viii) cash and Cash Equivalents of Subsidiaries
described in clause (ii) above that are legally and contractually available to such Subsidiary for the payment of
dividends to the Guarantor, but only to the extent that the source of such cash and Cash Equivalents is from such Subsidiary's EBITDA for such period or from repayments during such period to such
Subsidiary of loans made by such Subsidiary. 

        "Consolidated Net Worth" shall mean, as of any date of determination thereof, the amount which would be reflected as stockholders' equity
upon a consolidated balance sheet of the Guarantor (but excluding any portion thereof attributable to Unrestricted Subsidiaries) determined 

2

 

in accordance with GAAP, excluding other comprehensive income arising from the accounting treatment of hedging and mark-to-market transactions. 

        "Consolidated Subsidiary" shall mean with respect to any Person at any date any Subsidiary or other entity the accounts of which would be
consolidated in accordance with GAAP with those of such Person in its consolidated financial statements as of such date. 

        "Consolidated Tangible Net Assets" shall mean at any date the total net assets of the Guarantor and its Consolidated Subsidiaries (other
than Unrestricted Subsidiaries) determined in accordance with GAAP, excluding, however, from the determination of total net assets (i) goodwill, organizational expenses, research and product
development expenses, trade marks, trade names, copyrights, patents, patent applications, licenses and rights in any thereof, and other similar intangibles, (ii) all deferred charges or
unamortized debt discount and expenses, (iii) all reserves carried and not deducted from assets, (iv) securities which are not readily marketable, (v) cash held in sinking or
other analogous funds established for the purpose of redemption, retirement or prepayment of capital stock or other equity interests or Indebtedness, and (vi) any items not included in clauses
(i) through (v) above which are treated as intangibles in conformity with GAAP. 

        "Credit Support Arrangements" shall mean any Guaranty, letter of credit or other instrument or arrangement issued as support for the
payment or performance obligations of a party under any Trading Arrangement. 

        "Distribution" shall mean, in respect of any Person, (i) any payment of any dividends or other distributions with respect to the
capital stock or other equity interests of such Person (except distributions in such capital stock or other equity interests) and (ii) any purchase, redemption or other acquisition or
retirement for value of any capital stock or other equity interests of such Person or any Affiliate of such Person unless made contemporaneously from the net proceeds of the sale of capital stock or
other equity interests. 

        "EBITDA" shall mean, with respect to any Person for any period, the (i) income (or loss) before interest and taxes of such Person,  plus (ii) to the extent
deducted in determining such income (or loss), depreciation, amortization and other similar non-cash charges
and reserves, minus (iii) to the extent recognized in determining such income (or loss), extraordinary gains (or losses), restructuring charges
or other non-recurring items, plus (iv) to the extent deducted in determining such income (or loss), Lease Payment Obligations
described in clause (iii) of the definition of "Lease Payment Obligations". 

        "Equity Funding Arrangement" shall mean (i) an agreement to provide a capital contribution to or other equity investment in any
Asset Company or Investment Vehicle in connection with any Project Financing Facility, (ii) a Guaranty, letter of credit or other similar arrangement with respect to any
obligations of any Asset Company or Investment Vehicle under a Project Financing Facility, (iii) a Guaranty of any Investment Vehicle's obligation to make a capital contribution to or other
equity investment in any Asset Company or Investment Vehicle in connection with a Project Financing Facility or (iv) a Guaranty, letter of credit or other similar arrangement to support any of
the obligations or arrangements described in clauses (i) through (iii) hereof. 

        "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as the same may be amended from time to time. 

        "ERISA Affiliate" shall mean any trade or business (whether or not incorporated) that is a member of a group of (i) organizations
described in Sections 414(b) or 414(c) of the Code and (ii) solely for purposes of the Lien created under Section 412(n) of the Code, organizations described in Sections 414(m) or 414(o)
of the Code of which the Guarantor is a member. 

3

 

        "ERISA Event" shall mean (i) the Guarantor or any ERISA Affiliate shall fail to pay when due an amount or amounts aggregating in
excess of $15,000,000 which it shall have become liable to pay under Title IV of ERISA; or (ii) notice of intent to terminate a Material Plan shall be filed under Title IV of ERISA by the
Guarantor or any ERISA Affiliate, any plan administrator or any combination of the foregoing; or (iii) the PBGC shall institute proceedings under Title IV of ERISA to terminate, to impose
liability (other than for premiums under Section 4007 of ERISA) in respect of, or to cause a trustee to be appointed to administer any Material Plan; or (iv) a condition shall exist by
reason of which the PBGC would be entitled to obtain a decree adjudicating that any Material Plan must be terminated; or (v) there shall occur a complete or partial withdrawal from, or a
default, within the meaning of Section 4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which could cause the Guarantor or any ERISA Affiliate to incur a current payment
obligation in excess of $15,000,000; or (vi) receipt by the Guarantor or any ERISA Affiliate of notice from one or more Multiemployer Plans of intent to terminate or that it is insolvent or in
reorganization (within the meaning of Section 4241 or 4245 of ERISA, as applicable) which termination, insolvency or reorganization, individually or together with other such events, could cause
the Guarantor and/or any ERISA Affiliate, individually or in the aggregate, to incur a current payment obligation in excess of $15,000,000; or (vii) the Guarantor or any ERISA Affiliate shall
engage in one or more non-exempt "prohibited transactions" (as defined in Section 406 of ERISA or Section 4975 of the Code) which could result in a current payment obligation
of the Guarantor and/or any ERISA Affiliate individually or in the aggregate, in an amount or amounts aggregating in excess of $15,000,000; or (viii) the occurrence of any event or series of
events of which the nature described in clauses (i) through (vii) with respect to any Plan or Multiemployer Plan which, individually or in the aggregate, could result in a liability to
the Guarantor and/or any ERISA Affiliate, individually or in the aggregate, in an amount or amounts aggregating in excess of $50,000,000. 

        "ET Credit Agreements" shall mean (i) the $50,000,000 Credit Agreement, dated as of November 13, 1998, between PG&E Energy
Trading Gas Corporation, PG&E Energy Trading, Canada Corporation, ET Holdings, PG&E Energy Trading Power, L.P. and Bank of Montreal and (ii) the $35,000,000 Credit
Agreement, dated as of November 13, 1998, between PG&E Energy Trading—Gas Corporation, PG&E Energy Trading, Canada Corporation, PG&E Energy—Trading Power Holdings
Corporation, PG&E Energy Trading Power, L.P. and The Chase Manhattan Bank, as each may be amended, modified or supplemented from time to time. 

        "ET Holdings" shall mean PG&E Energy Trading Holdings Corporation, a California corporation. 

        "Federal Reserve System" shall mean the Federal Reserve System of the United States of America. 

        "Financed Subsidiary" shall mean any direct or indirect Subsidiary of the Guarantor that is financed with Indebtedness of such Subsidiary. 

        "Financial Officer" of any Person shall mean the chief financial officer, principal accounting officer, treasurer, associate or assistant
treasurer, or any responsible officer analogous to the foregoing or designated by the one of the foregoing Persons, of such Person. 

        "Fitch" shall mean Fitch, Inc. 

        "Fixed Charges" shall mean, with respect to the Guarantor for any period, the sum, without duplication, of (i) the aggregate amount
of interest expense and commitment and other fees with respect to Funded Indebtedness of the Guarantor Scheduled to be Paid for such period, including (A) the net costs under Swaps,
(B) all capitalized interest, (C) the interest portion of any deferred payment obligation and (D) the Lease Payment Obligations of the Guarantor Scheduled to be Paid 

4

 

by the Guarantor during such period, and (ii) the aggregate amount of all mandatory scheduled payments (whether designated as payments or prepayments) and scheduled sinking fund payments with
respect to principal of any Funded Indebtedness of the Guarantor, including payments in the nature of principal under Lease Obligations, provided that
with respect to any Funded Indebtedness of the Guarantor consisting of Equity Funding Arrangements, "Fixed Charges" shall not include any of the foregoing enumerated items to the extent paid by a
Subsidiary of the Guarantor (so long as the funds used to make such payments were not provided by the Guarantor). 

        "Funded Indebtedness" of a Person shall mean all Indebtedness of such Person (after intercompany eliminations) other than any Guaranty
obligations that are not reasonably quantifiable under standard accounting practices as of the date of determination. 

        "GAAP" shall mean generally accepted accounting principles, applied on a consistent basis. 

        "Governmental Approvals" shall mean all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with,
and notices and reports to all Governmental Authorities. 

        "Government Authority" shall mean any Federal, state, county, municipal or other local governmental authority or judicial or regulatory
agency, board, body, commission or instrumentality. 

        "GTN" shall mean PG&E Gas Transmission, Northwest Corporation, a California corporation. 

        "GTN Credit Agreements" shall mean (i) the $750,000,000 Indenture, dated as of May 22, 1995, between GTN and The First
National Bank of Chicago, as trustee and (ii) the $100,000,000 Amended and Restated Credit Agreement and $50,000,000 364-Day Credit Agreement, each dated May 24, 1999,
between GTN, the lenders party thereto and Citicorp USA, Inc., as administrative agent for such lenders, including any commercial paper supported by credit facilities made available under such
credit agreements, as the same may be amended, modified or supplemented from time to time. 

        "Guaranteed Obligations" shall mean the collective reference to the unpaid principal of and interest on the Loans and all other payment
obligations and liabilities of the Company (including, without limitation, interest accruing at the then applicable rate provided in the Credit Agreement after the maturity of the Loans and interest
accruing at the then applicable rate provided in the Credit Agreement after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating
to the Company, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) to the Security Agent or any Lender, whether direct or indirect,
absolute or contingent, due or to become due, or now existing or hereafter incurred, under the Credit Agreement and the other Loan Documents or any other document made, delivered or given in
connection with any of the foregoing, in each case whether on account of principal, interest, fees, indemnities, costs, expenses or otherwise. 

        "Guarantor" shall be defined as in the recitals hereto. 

        "Guaranty" shall mean (a) a guaranty by a Person (other than by endorsement of negotiable instruments for collection in the
ordinary course of business), directly or indirectly, in any manner, of any part or all of the obligations of another Person; and (b) an agreement by a Person, direct or indirect, contingent or
otherwise, and whether or not constituting a guaranty, the practical effect of which is to assure the payment or performance (or payment of damages in the event of nonperformance) of any part or all
of the obligations of another Person (other than in respect of operating leases not otherwise included in the definition of "Lease Obligations"), whether by (i) the purchase of securities or
obligations, (ii) the purchase, sale or lease of property or the 

5

 

purchase or sale of services primarily for the purpose of enabling the obligor with respect to such obligation to make any payment or performance (or payment of damages in the event of
nonperformance) of or on account of any part or all of such obligation, or to assure the obligee of such obligation against loss, (iii) repayment of amounts drawn down by beneficiaries of
letters of credit, (iv) the maintenance of working capital, equity capital, available cash or other financial statement condition so as to enable the primary obligor to pay Indebtedness;
(v) the provision of equity or other capital under or in respect of equity or other capital subscription arrangements, (vi) the supplying of funds to or investing in a Person on account
of all or any part of such Person's obligation or indemnifying or holding harmless, in any way, such Person against any part or all of such obligation or (vii) the placing of any Lien on
property (including, without limitation, accounts and contract rights) of a Person to secure another Person's Indebtedness. 

        "Incipient NEG Trigger Event" shall mean any condition or event which, with notice or lapse of time or both, would become a NEG Trigger
Event. 

        "Indebtedness" of any Person shall mean (i) all indebtedness of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person to pay the deferred purchase price of property or services, (iv) all
indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession or sale of such property), (v) all Lease Obligations of such Person, (vi) all obligations, contingent or
otherwise, of such Person under any issued and outstanding acceptance, letter of credit or similar instruments, (vii) all obligations of such Person to redeem or purchase any capital stock of
such Person which is mandatorily redeemable, (viii) all Swaps of such Person and (ix) any Guaranty of such Person with respect to liabilities of the type described in clauses
(i) through (viii) hereof. 

        "Investment" shall mean the acquisition of any interest in any Person or property, a loan or advance to any Person or other arrangement
for the purpose of providing funds or credit to any Person, a capital contribution in or to any Person, or any other investment in any Person or property, or any Guaranty of any of the foregoing. 

        "Investment Vehicle" shall mean each Subsidiary of the Guarantor which is organized solely to acquire, make or hold one or more
Investments in an Asset Company or Asset Companies, either directly or indirectly through one or more other Investment Vehicles. 

        "Lease Obligations" shall mean, without duplication, (i) any Indebtedness represented by obligations under a lease that is required
to be capitalized for financial reporting purposes and (ii) the present value, determined using a discount rate equal to the incremental borrowing rate (as defined in Statement of Financial
Accounting Standards No. 13) of the Person incurring such obligations, of rent obligations under leases of electric generating assets or natural gas pipelines and related facilities. 

        "Lease Payment Obligations" shall mean, with respect to any Person for any period, (i) the interest component of all Lease
Obligations of such Person that are described in clause (i) of the definition of "Lease Obligations" and that are Scheduled to be Paid during such period,  plus (ii) the principal portion of
all Lease Obligations of such Person that are described in clause (i) of the definition of "Lease
Obligations" that are Scheduled to be Paid during such period, plus (iii) all rent payment obligations relating to Lease Obligations of such
Person described in clause (ii) of the definition of "Lease Obligations" and that are Scheduled to be Paid during such period. 

        "Letter Agreement" shall mean the letter agreement, dated as of May 29, 2001, from NEG LLC addressed to the Security Agent, for the
benefit of the Lenders. 

6

 

        "Lien" shall mean, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect
of such asset or any interest or title of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such asset. 

        "Material Adverse Effect" shall mean a materially adverse change in (a) the business, assets, property or condition (financial or
otherwise) or operations of the Guarantor and its Subsidiaries taken as whole, or (b) the ability of the Guarantor to perform its obligations under this Guarantee and Agreement. 

        "Material Plan" shall mean any Plan or Plans having aggregate Unfunded Liabilities in excess of $50,000,000. 

        "Minimum Consolidated Net Worth" shall mean US$1.8 billion. 

        "Minimum Non-Trading Consolidated Net Worth" shall mean US$1.4 billion. 

        "Moody's" shall mean Moody's Investors Service, Inc. 

        "Multiemployer Plan" shall mean a multiemployer plan as defined in Section 4001(a)(3) of ERISA to which the Guarantor or any ERISA
Affiliate is making, or accruing an obligation to make, contributions, or has within any of the preceding six years made, or accrued an obligation to make, contributions. 

        "NEG/ET Letter of Credit Facilities" shall mean a letter of credit facility entered into by ET Holdings, any of its Subsidiaries and/or
the Guarantor in an aggregate amount not to exceed $500,000,000, as the same may be amended, modified or supplemented from time to time. 

        "NEG Downgrade Event" shall mean (i) unless the NEG Guarantee Release Date has occurred, the Guarantor's senior unsecured long term
debt (x) ceases to be rated at least BBB- by S&P and (y) ceases to be rated at least Baa3 by Moody's (or if ratings of such debt have not been issued by such rating agencies,
such debt ceases to be impliedly rated by an issuer rating or indicative rating at least BBB- by S&P and Baa3 by Moody's) and the Guarantor fails to provide to the Security Agent, within
thirty (30) days after the date on which such event occurs, a Substitute Credit Support Instrument in the amount of the Substitute Credit Support Amount or (ii) if a Substitute Credit
Support Instrument in the form of a guaranty pursuant to clause (b) of the definition thereof has been provided in accordance with Section 2.07, from and after the effectiveness of such
Substitute Credit Support Instrument, the senior unsecured long term debt of the guarantor thereunder (x) ceases to be rated at least BBB- by S&P and (y) ceases to be rated
at least Baa3 by Moody's (or if ratings of such debt have not been issued by such rating agencies, such debt ceases to be impliedly rated by an issuer rating or indicative rating at least
BBB- by S&P and Baa3 by Moody's) and the guarantor thereunder fails to provide to the Security Agent, within thirty (30) days after the date on which such event occurs, a Substitute
Credit Support Instrument in the amount of the Substitute Credit Support Amount. 

        "NEG Guarantee Release Date" shall mean the earliest of (x) the date on which the Guaranteed Obligations have been paid in full and
(y) the date on which this Guarantee and Agreement terminates in accordance with Section 2.07(b) hereof. 

        "NEG LLC" shall mean PG&E National Energy Group, LLC, a Delaware limited liability company. 

        "NEG Trigger Event" shall mean any of the events set forth in Section V of this Guarantee and Agreement. 

        "Non-Trading Consolidated Net Worth" shall mean, as of any date of determination thereof, the amount which would be reflected
as stockholders' equity upon a consolidated balance sheet of the 

7

 

Guarantor (but excluding any portion thereof attributable to (i) Unrestricted Subsidiaries or (ii) ET Holdings or any Subsidiary thereof) excluding other comprehensive income arising
from the accounting treatment of hedging and mark-to-market transactions. 

        "Other NEG Guarantees" shall mean (i) the Guarantee and Agreement (La Paloma), dated as of April 6, 2001, made by the
Guarantor in favor of Citibank, N.A., for the benefit of the creditors identified
therein, (ii) the Guarantee and Agreement (Lake Road), dated as of April 6, 2001, made by the Guarantor in favor of Citibank, N.A., for the benefit of the creditors identified therein
and (iii) the Guarantee and Agreement (Harquahala) to be delivered by the Guarantor in favor of the security agent thereunder, for the benefit of the creditors identified therein. 

        "Payment Demand" shall mean the payment demand in the form of Exhibit A. 

        "PBGC" shall mean the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA. 

        "Permitted Encumbrances" shall mean, as to any Person at any date, any of the following: 

          (i)  Liens
for taxes, assessments or governmental charges not then delinquent, and Liens for taxes, assessments or governmental charges then delinquent but the validity of
which is being contested at the time by such Person in good faith and for which adequate reserves have been established in accordance with GAAP, and (ii) Liens incurred or created in connection
with or to secure the performance of bids, tenders, contracts (other than for the payment of money), leases, statutory obligations, surety bonds or appeal bonds, and carriers', warehousemen's,
mechanics' or materialmen's Liens, assessments or similar encumbrances incurred in the ordinary course of business; 

        (ii)  easements,
restrictions, exceptions or reservations in any property and/or rights of way of such Person for the purpose of roads, pipe lines, substations, transmission
lines, transportation lines, distribution lines, removal of oil, gas, lignite, coal or other minerals or timber, and other like purposes, or for the joint or common use of real property, rights of
way, facilities and/or equipment, and defects, irregularities and deficiencies in titles of any property and/or rights of way, which do not individually or in the aggregate materially impair the use
or value of such property and/or rights of way for the purposes for which such property and/or rights of way are held by such Person; 

        (iii)  rights
reserved to or vested in any municipality or public authority to use, control or regulate any property of such Person; 

        (iv)  any
obligations or duties, affecting the property of such Person, to any municipality or public authority with respect to any franchise, grant, license or permit; 

        (v)  any
judgment Lien against such Person securing a judgment for an amount not exceeding $50,000,000, so long as the finality of such judgment is being contested by
appropriate proceedings conducted in good faith and execution thereon is stayed; 

        (vi)  any
Lien arising by reason of deposits with or giving of any form of security to any federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, for any purpose at any time as required by law or governmental regulation as a condition to the transaction of any business or the exercise of
any privilege or license, or to enable such Person to maintain self-insurance or to participate in any fund for liability on any insurance risks or in connection with workers'
compensation, unemployment insurance, old age pensions or other social security or to share in the privileges or benefits required for companies participating in such arrangements; or 

8

 

      (vii)  any
landlords' Lien on fixtures or movable property located on premises leased by such Person in the ordinary course of business so long as the rent secured thereby is
not in default. 

        "Permitted Sale-Leaseback Transactions" shall mean (i) Sale-Leaseback transactions by any Restricted
Subsidiary or Asset Company, entered into on or prior to the date of this Guarantee and Agreement and identified on Schedule 1.01A and (ii) one or more Sale/Leaseback transactions
entered into by any Asset Company in connection with or as part of a Project Financing Facility entered into after the date of execution of this Guarantee and Agreement. 

        "Permitted Subordinated Indebtedness" shall mean all unsecured Indebtedness of the Guarantor that shall have been subordinated to all
Indebtedness of the Guarantor under this Guarantee and Agreement and otherwise containing terms and conditions set forth in Schedule 1.01B with respect to Indebtedness of the Guarantor to
Affiliates of the Guarantor or in Schedule 1.01C with respect to Indebtedness of the Guarantor to non-Affiliates of the Guarantor. 

        "Person" shall mean any individual, corporation, partnership, joint venture, association, joint-stock company, limited liability company,
trust, unincorporated organization, governmental authority or any other entity. 

        "PG&E" shall mean Pacific Gas & Electric Company, a California corporation. 

        "PG&E Corp." shall mean PG&E Corporation, a California corporation. 

        "PG&E Gen" shall mean PG&E Generating Company, LLC, a Delaware limited liability company. 

        "PG&E Gen Credit Agreements" shall mean (i) the $1.1 Billion PG&E Gen Credit Agreement, including any commercial paper supported by
credit facilities made available thereunder, and (ii) the $10,000,000 Credit Agreement, dated as of December 14, 1999, between PG&E Gen and ABN AMRO Bank N.V., as each may be amended,
modified or supplemented from time to time. 

        "PG&E Gen Credit Agreement Refinancing Date" shall mean the date on which the commitments and all amounts outstanding under the $1.1
Billion PG&E Gen Credit Agreement are refinanced by one or more credit facilities of the Guarantor. 

        "Plan" shall mean any employee pension benefit plan described under Section 3(2) of ERISA (other than a Multiemployer Plan) subject
to the provisions of Title IV of ERISA that is maintained by the Guarantor or any ERISA Affiliate or with respect to which the Guarantor or any ERISA Affiliate could have liability under
Section 4069 of ERISA. 

        "Project Financing Facility" shall mean any loan, note purchase agreement, indenture, lease, credit agreement, reimbursement agreement,
letter of credit or other facility pursuant to which an Asset Company or Investment Vehicle which directly or indirectly owns an Asset Company incurs Indebtedness,  provided that any such Indebtedness is
recourse only to (a) the assets of such Asset Company or any Asset Company which is a Subsidiary of such
Asset Company, (b) the equity or ownership interests of such Asset Company or any Investment Vehicle which owns such Asset Company or (c) any Equity Funding Arrangements provided with
respect to such Asset Company or Investment Vehicle or a Lien on any such Equity Funding Arrangements. 

        "Projections" shall mean the projections contained in the presentation materials distributed by the Guarantor to the Lenders during the
bank meeting held on March 21, 2001 in New York City. 

        "Ratio of Cash Flow to Fixed Charges" shall mean, as of the end of each fiscal quarter the Guarantor, the ratio of (a) Cash Flow
Available for Fixed Charges of the Guarantor for the period of four consecutive fiscal quarters ending on, or most recently ended prior to, such date to 

9

 

(b) Fixed Charges of the Guarantor for such period, excluding from the calculation of Fixed Charges all Trading Arrangements and Credit Support Arrangements. 

        "Ratio of Debt to Capitalization" shall mean, as of any date, the ratio of the aggregate principal amount of Funded Indebtedness of the
Guarantor and PG&E Gen to the Total Capitalization of the Guarantor (excluding from the calculation of Funded Indebtedness all Trading Arrangements, Credit Support Arrangements and Swaps);  provided that any Equity Funding Arrangements shall only be included in Funded Indebtedness in an amount equal to the lesser of (x) the maximum
amount that would be
payable under such Equity Funding Arrangements (assuming a drawing is permissible as of the date of determination) and (y) the amount outstanding under any underlying Indebtedness to which any
payment under such Equity Funding Arrangements would be applied (assuming such Indebtedness were due and payable as of the date of determination). 

        "Refinanceable Facilities" has the meaning ascribed thereto in Section 4.12(a). 

        "Repurchase Agreement" shall mean any written agreement: 

          (i)  that
provides for (i) the transfer of one or more United States or Canadian Governmental Securities or any security issued by a U.S. agency or instrumentality in
an aggregate principal amount at least equal to the amount of the Transfer Price (defined below) to the Guarantor or any Restricted Subsidiary from a financial institution that is (1) a member
of the Federal Reserve System having a minimum of US$20 billion in assets, and (2) has commercial paper rated at least A-1 by S&P, at least F1 by Fitch or at least
P-1 by Moody's, against a transfer of funds (the "Transfer Price") by the Guarantor or such Restricted Subsidiary to such financial
institution and (ii) a simultaneous agreement by the Guarantor or such Restricted Subsidiary, in connection with such transfer of funds, to transfer to such financial institution the same or
substantially similar United States or Canadian Governmental Securities or any security issued by a U.S. agency or instrumentality for a price not less than the Transfer Price plus a reasonable return
thereon at a date certain not later than 180 days after such transfer of funds, 

10

  

        (ii)  in
respect of which the Guarantor or such Restricted Subsidiary shall have the right, whether by contract or pursuant to applicable law, to liquidate such agreement
upon the occurrence of any default thereunder, and 

        (iii)  in
connection with which the Guarantor or such Restricted Subsidiary, or an agent thereof, shall have taken all action required by applicable law or regulations to
perfect a Lien in such United States or Canadian Governmental Securities or any security issued by a U.S. agency or instrumentality. 

        "Responsible Officer" of the Guarantor, shall mean any president or senior vice president of the Guarantor. 

        "Restricted Subsidiary" shall mean any Subsidiary of the Guarantor that is not (x) an Asset Company, (y) an Investment
Vehicle or (z) an Unrestricted Subsidiary. 

        "S&P" shall mean Standard & Poor's Ratings Service, a division of McGraw Hill Companies, Inc. 

        "Sale/Leaseback" shall mean any lease whereby any Person becomes or remains liable as lessee or as guarantor or other surety of any
property, whether now owned or hereafter acquired, that such Person has sold or transferred or is to sell or transfer to any other Person (other than any Subsidiary of such Person), as part of a
financing transaction to which such Person is a party, in contemplation of leasing such property to such Person. 

        "Scheduled to be Paid" shall mean, with respect to any liability or expense for any period, the amount of such liability or expense
scheduled to be paid during such period or the amount of such liability or expense that would have been scheduled to be paid during such period had the payment schedule with respect to such liability
or expense been divided equally into successive periods having a duration equal to the duration of such period. 

        "Subsidiary" shall mean, with respect to any Person (the "Parent"), any corporation or
other entity of which sufficient securities or other ownership interests having ordinary voting power to elect a majority
of the board of directors or other Persons performing similar functions are at the time directly or indirectly owned by such Parent. 

        "Substitute Credit Support Amount" shall mean, as of the date any Substitute Credit Support Instrument is provided, 105% of the amount of
the outstanding principal of all Loans (or, if higher, an amount equal to 105% of the Total Commitments in effect at such time, or, if not in effect at such time, in effect immediately prior to any
termination thereof) as determined by the Administrative Agent. 

        "Substitute Credit Support Instrument" shall mean either (a) an irrevocable letter of credit issued in form and substance
satisfactory to the Security Agent in its reasonable judgment and from a bank or trust company with a combined capital and surplus of at least $1,000,000,000 whose unsecured senior long term debt is
rated at least "A" by S&P and "A2" by Moody's; provided that such letter of credit shall contain provisions that authorize a draw on such letter of
credit in the event that (i) either (A) there is a downgrade in the credit rating of the issuer of such letter of credit to below the level specified above or (B) such issuer is
no longer rated by both S&P and Moody's and such letter of credit is not replaced with a Substitute Credit Support Instrument within thirty (30) days after such event, (ii) such letter
of credit is not replaced or renewed by no later than fifteen (15) Business Days prior to its date of expiration or (iii) an Event of Default shall have occurred and be continuing and
the Guaranteed Obligations are then due and payable or (b) a Guaranty in form and substance satisfactory to, and issued by a Subsidiary of the Guarantor acceptable to, each Lender in its sole
discretion. 

11

 

        "Swaps" shall mean, with respect to any Person, payment obligations with respect to interest rate swaps, currency swaps and similar
obligations obligating such Person to make payments, whether periodically or upon the happening of a contingency. The amount of the obligation under any Swap shall be the amount determined in respect
thereof as of the end of the then most recently ended fiscal quarter of such Person, based on the assumption that such Swap had terminated at the end of such fiscal quarter, and in making such
determination, if any agreement relating to such Swap provides for the netting of amounts payable by and to such Person thereunder of if any such agreement provides for the simultaneous payment of
amounts by and to such Person, then in each such case, the amount of such obligation shall be the net amount so determined. 

        "Total Capitalization" shall mean, with respect to the Guarantor, the sum, without duplication, of (i) total common stock equity or
analogous ownership interests of the Guarantor, (ii) preferred stock and preferred securities of the Guarantor, (iii) additional paid in capital or analogous interests of the Guarantor,
(iv) retained earnings of the Guarantor, excluding other comprehensive income arising from accounting treatment of hedging and mark-to-market transactions and
(v) the aggregate principal amount of Funded Indebtedness of the Guarantor and PG&E Gen. 

        "Trading Arrangement" shall mean any transaction entered into by PG&E Energy Trading—Power, L.P., a Delaware limited
partnership, PG&E Energy Trading Gas Corporation, a California corporation, or
PG&E Energy Trading, Canada Corporation, an Alberta corporation, any other Restricted Subsidiary, Asset Company or Investment Vehicle, whether pursuant to master trading agreements or otherwise, for
(1) the purchase and sale of energy, capacity, ancillary services and other energy or energy-related products, including transmission rights, environmental allowances and offsets and storage;
(2) the purchase and sale of natural gas, coal, oil and other fuel, including transportation and storage rights; (3) the purchase and sale of fuel conversion services, including tolling
arrangements; (4) the purchase and sale of any energy or energy-related derivatives, including weather derivatives; (5) hedging arrangements with respect to any of the foregoing and
interest rate, foreign currency or credit exposure; or (6) any similar arrangements entered into in the ordinary course of business as conducted by such Persons or by other Persons in the
energy trading, energy services, power generating, electric transmission or gas transmission and storage businesses (including technologies related to such businesses). 

        "Unfunded Liabilities" shall mean, with respect to any Plan at any time, the amount (if any) by which (i) the value of all benefit
liabilities under such Plan, determined on a plan termination basis using the assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market value
of all Plan assets allocable to such liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions), all determined as of the then most recent valuation date for such Plan, but
only to the extent that such excess represents a potential liability of the Guarantor or any ERISA Affiliate to the PBGC or any other Person under Title IV of ERISA. 

        "United States" or "U.S." or "US" shall
mean the United States of America. 

        "United States or Canadian Governmental Securities" shall mean securities issued, or fully guaranteed or insured by the United States or
Canadian government. 

        "Unrestricted Subsidiary" shall mean any Subsidiary of the Guarantor designated as such on the Closing Date, or, after the Closing Date,
designated as such at the time of formation thereof or, if acquired by the Guarantor, at the time of acquisition thereof, but, in any such case, only if at such time (i) no NEG Trigger Event,
Incipient NEG Trigger Event or NEG Downgrade Event has occurred and is continuing or would occur as a result thereof and (ii) such Subsidiary or any of its Subsidiaries does not own any capital
stock or Indebtedness of or have any Investment in, or own 

12

 

or hold any Lien on any property of, any other Subsidiary of the Guarantor which is not a Subsidiary of the Subsidiary to be so designated or otherwise an Unrestricted Subsidiary. 

        "USGenNE" shall mean USGen New England, Inc., a Delaware corporation and an indirect, wholly-owned Subsidiary of the Guarantor. 

        "USGenNE Credit Agreement" shall mean the $575,000,000 Credit Agreement, dated as of September 1, 1998, among USGenNE, the lenders
party thereto, The Chase Manhattan Bank, as competitive advance facility agent and as administrative agent for the lenders thereunder, and The Chase Manhattan Bank, as the issuer of letters of credit
thereunder, the same may be amended, modified or supplemented from time to time. 

        1.02.    Other Definitional Provisions.    The following rules of usage shall apply unless otherwise required by the
context or unless otherwise specified herein: 

        (a)  Definitions
set forth herein shall be equally applicable to the singular and plural forms of the terms defined. 

        (b)  References
in any document to articles, sections, paragraphs, clauses, annexes, appendices, schedules or exhibits are references to articles, sections, paragraphs,
clauses, annexes, appendices, schedules or exhibits in such document. 

        (c)  The
headings, subheadings and table of contents used herein are solely for convenience of reference and shall not constitute a part hereof nor shall they affect the
meaning, construction or effect of any provision hereof. 

        (d)  References
to any Person shall include such Person, its successors and permitted assigns and transferees. 

        (e)  Reference
to any agreement means such agreement as amended, supplemented or otherwise modified from time to time in accordance with the applicable provisions thereof. 

        (f)    References
to any law includes any amendment or modification to such law and any rules or regulations issued thereunder or any law enacted in substitution or replacement
thereof. 

        (g)  The
words "hereof," "herein", "hereto" and "hereunder" and words of similar import when used in this Guarantee and Agreement shall refer to this Guarantee and Agreement
as a whole and not to any particular provision of this Guarantee and Agreement. 

        (h)  References
to "including" means including without limiting the generality of any description preceding such term and for purposes hereof the rule of  ejusdem generis shall not be applicable to limit
a general statement, followed by or referable to an enumeration of specific matters, to matters similar to those specifically mentioned. 

        (i)    Each
of the parties to this Guarantee and Agreement and their counsel have reviewed and revised, or requested revisions to this Guarantee and Agreement, and the usual
rule of construction that any ambiguities are to be resolved against the drafting party shall be inapplicable in the construing and interpretation of this Guarantee and Agreement and any amendments
hereto. 

        (j)    Except
as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time;  provided that for purposes of
determining compliance with any covenant set forth herein, such terms shall be construed in accordance with GAAP as in
effect on the date hereof applied on a basis consistent with the application used in preparing the Guarantor's audited financial statements. 

13

 

SECTION II GUARANTEE  

        2.01.    Guarantee; Payment.    (a) Subject to the terms herein, the Guarantor unconditionally guarantees to
the Security Agent for the benefit of the Lenders, the prompt and complete payment when due of the Guaranteed Obligations. This is a guarantee of payment and not of collection. 

        (b)  When
and at such time as a NEG Trigger Event shall have occurred and be continuing, the Security Agent shall be entitled to make a Payment Demand to the Guarantor (with
a copy to the Company) in accordance with Section 2.04 for the payment of all due and unpaid Guaranteed Obligations. The Guarantor shall pay such Guaranteed Obligations to the Security Agent
within five (5) Business Days of receipt of such Payment Demand. 

        2.02.    Extent of Liability.    Except as the same comprise Guaranteed Obligations under the Loan Documents, the
Guarantor shall not be liable hereunder for special, consequential, exemplary, tort or other damages. The Guarantor agrees to pay all out-of-pocket expenses (including the
reasonable fees and expenses of Security Agent's counsel) incurred for the enforcement of the rights of Security Agent hereunder; provided that the
Guarantor shall not be liable for any such expenses if no payment in respect of the Guaranteed Obligations is due. Subject to reinstatement pursuant to Section 2.03, this Guarantee and
Agreement shall remain in full force and effect until the NEG Guarantee Release Date unless otherwise terminated in writing by the Guarantor and the Security Agent. 

        2.03.    Nature of Guarantee.    The Guarantor acknowledges and agrees that its guarantee obligations under this
Guarantee and Agreement shall be construed as continuing, absolute and unconditional without regard to (a) the validity, regularity or enforceability of any Loan Documents, any of the
Guaranteed Obligations or any other collateral security therefor or guaranty or right of offset with respect thereto at any time or from time to time held by the Security Agent or any Creditor,
(b) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by the Company or the Guarantor
against the Security Agent or any Creditor, or (c) any other circumstance whatsoever (with or without notice to or knowledge of the Company or the Guarantor) which constitutes, or might be
construed to constitute, an equitable or legal discharge of the Guaranteed Obligations (other than payment or performance), in bankruptcy or in any other instance. The Guarantor's obligations
hereunder with respect to any Guaranteed Obligations shall not be affected by the existence, validity, enforceability, substitution, perfection, or extent of any collateral for such Guaranteed
Obligations. The Security Agent shall be entitled but shall not be obligated to file any claim relating to the Guaranteed Obligations owing to it if the Company becomes subject to a bankruptcy,
reorganization or similar proceeding and the failure of the Security Agent to so file shall not affect the Guarantor's obligations hereunder. If any payment to the Security Agent made by the Company
or the Guarantor with respect to any Guaranteed Obligations is rescinded or must otherwise be returned for any reason whatsoever, the Guarantor shall remain liable therefor hereunder (and its
obligations reinstated hereunder if previously terminated) with respect to such Guaranteed Obligations as if such payment had not been made. The Guarantor reserves the right to assert defenses that
the Company may have under the Loan Documents to payment of any Guaranteed Obligation other than (i) defenses arising from the bankruptcy, insolvency, incapacity, liquidation or dissolution of
the Company, and (ii) defenses arising out of the matters described above in this Section 2.03 or any other circumstance or event that might otherwise constitute a legal or equitable
discharge of a guarantor or a surety generally. 

        2.04.    Demands and Notice; Application of Proceeds.    (a) A Payment Demand shall be sufficient notice to the
Guarantor to pay under this Guarantee and Agreement. The Guarantor shall make all payments of amounts owing pursuant to this Guarantee and Agreement by wire transfer of immediately available funds to
the account specified by the Security Agent in the Payment Demand. Notices under this Guarantee and Agreement shall be deemed received if sent to the address specified below: (i) on the day
received if served by overnight express delivery, (ii) on the next Business Day if served by 

14

 

facsimile transmission when sender has machine confirmation that facsimile was transmitted to the correct fax number listed below, and (iii) four Business Days after mailing if sent by
certified, first class mail, return receipt requested. Any party may change its address to which notice is given hereunder by providing notice thereof in accordance with this Section 2.04. 

	To the Guarantor:	 	PG&E National Energy Group, Inc.

7500 Old Georgetown Road, 13th floor

Bethesda, MD 20814

Attention: General Counsel

Fax: 301.280.6913
	

To the Security Agent:	
 	

Société Générale

1221 Avenue of the Americas

New York, NY 10020
	 	 	Attention:	 	Anna Lopiccolo

Loan Servicing

Agency Administrative Unit
	 	 	Fax: 212.278.5525

Tel: 212.278.6732

        (b)  The
Security Agent shall transfer the proceeds of any payment made hereunder to the Administrative Agent for distribution to the Lenders to be applied to the prepayment
or repayment in whole of the principal of the Loans, together with all accrued interest and other amounts due in respect of the Guaranteed Obligations. 

        2.05.    Consent to Modifications, Waivers.    The Security Agent and the Company may mutually agree to modify the
Loan Documents, extend the time of payment or otherwise modify the terms of payment of any of the Guaranteed Obligations, without in any way impairing or affecting this Guarantee and Agreement. The
Security Agent may resort to the Guarantor for payment of any of the Guaranteed Obligations, whether or not the Security Agent shall have resorted to any collateral security, or shall have proceeded
against (or otherwise exhausted Security Agent's remedies against) the Company or any other obligor principally or secondarily obligated with respect to any of the Guaranteed Obligations. The
Guarantor hereby waives demand (except in accordance with Sections 2.01 and 2.04), promptness, diligence (subject to any applicable statute of limitations), notice of acceptance of this Guarantee and
Agreement, and also presentment, protest and notice of protest or dishonor of any evidences of obligations hereby guaranteed. 

        2.06.    Subrogation.    The Guarantor waives any rights of subrogation or reimbursement from the Company or any other
Person that may accrue to Guarantor with respect to the payment of any Guaranteed Obligation by Guarantor to Security Agent under this Guarantee and Agreement until the time that all Guaranteed
Obligations owing to the Security Agent and the Lenders are fully and indefeasibly paid and the Commitments are terminated. Upon such full and indefeasible payment of all the Guaranteed Obligations
owing to the Security Agent and the Lenders and the termination of the Commitments, the
Guarantor shall be subrogated to the rights of the Security Agent and the Lenders against the Company, and the Security Agent agrees to take at Guarantor's expense such steps as the Guarantor may
reasonably request to cause the implementation of such subrogation. 

        2.07.    Substitute Credit Support.    Notwithstanding anything to the contrary set forth herein, the following
provisions shall apply: 

        (a)  At
any time prior to the termination of the Guaranteed Obligations, the Guarantor may deliver or cause to be delivered to Security Agent a Substitute Credit Support
Instrument with a stated amount at least equal to the Substitute Credit Support Amount in substitution for this Guarantee and Agreement in accordance with this Section 2.07. 

15

 

        (b)  Upon
delivery of a Substitute Credit Support Instrument together with a legal opinion satisfactory to the Administrative Agent that the delivery of such instrument would
not constitute a preference in a bankruptcy of the Guarantor or, if no legal opinion is delivered with such Substitute Credit Support Instrument, upon the 91st day after the delivery of
such Substitute Credit Support Instrument (so long as no bankruptcy, insolvency or other similar event has occurred with respect to the Guarantor), this Guarantee and Agreement shall terminate and the
Guarantor shall be relieved of any liability hereunder. Within ten (10) days of the receipt of such Substitute Credit Support Instrument together with such legal opinion, if applicable, or on
the 91st day after delivery of such Substitute Credit Support Instrument (so long as no bankruptcy, insolvency or other similar event has occurred with respect to the Guarantor), if
applicable, the Security Agent shall return to the Guarantor this Guarantee and Agreement together with any certificate or other documentation reasonably requested by the Guarantor in order to confirm
the cancellation of this Guarantee and Agreement. 

SECTION III REPRESENTATIONS AND WARRANTIES  

        The Guarantor represents and warrants to the Security Agent and each of the Lenders as of the date hereof and on each date Loans are to be made pursuant to the
Credit Agreement as follows (except to the extent that any representation or warranty hereunder is made with respect to an earlier date, in which case such representation and warranty shall be deemed
to have been made on such earlier date): 

        3.01.    Organization; Powers; Ownership of Property.    The Guarantor and each of its Subsidiaries (other than
Unrestricted Subsidiaries) (a) is duly formed, validly existing and in good standing under the laws of the jurisdiction of its formation, except, with respect to such Subsidiaries, where the
failure to be validly existing or in good standing is not reasonably likely to result in a Material Adverse Effect, (b) has all requisite power and authority to own its property and assets and
to carry on its business as now conducted and as proposed to be conducted, (c) is qualified to do business in every jurisdiction where
such qualification is required, except where the failure so to qualify is not reasonably likely to result in a Material Adverse Effect, (d) as to the Guarantor only, has the power and authority
to execute, deliver and perform its obligations under this Guarantee and Agreement, and (e) owns and has good and marketable title to all of its properties and assets, subject to no Liens other
than those permitted by Section 4.11 hereof, except where the failure to own or to have good and marketable title to such property or asset is not reasonably likely to result in a Material
Adverse Effect. 

        3.02.    Authorization.    The execution, delivery and performance by the Guarantor of this Guarantee and Agreement
(a) have been duly authorized by all requisite corporate action on the part of the Guarantor, and (b) will not (i) violate (A) any provision of any law, statute, rule or
regulation to which the Guarantor is subject, (B) the articles of incorporation or by-laws of the Guarantor, (C) any order of any Governmental Authority to which the
Guarantor is subject, or (D) any material provision of any indenture, agreement or other instrument to which the Guarantor is a party or by which it or any of its property is or may be bound,
which such violation is reasonably likely to result in a Material Adverse Effect, (ii) constitute (alone or with notice or lapse of time or both) a default under any such indenture, agreement
or other instrument, which such default is reasonably likely to result in a Material Adverse Effect or (iii) result in the creation or imposition of any Lien upon any property or assets of the
Guarantor, which such Lien is reasonably likely to result in a Material Adverse Effect. 

        3.03.    Enforceability.    This Guarantee and Agreement constitutes a legal, valid and binding obligation of the
Guarantor enforceable in accordance with its terms except to the extent that enforcement may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights
generally. 

16

 

        3.04.    Financial Statements.    (a) The consolidated balance sheet of the Guarantor and its Consolidated
Subsidiaries as of December 31, 1999 and December 31, 2000, reported on by an independent public accountant of nationally recognized standing, and the related consolidated statements of
income, retained earnings and cash flows for the fiscal periods then ended, copies of which have been delivered to the Administrative Agent, fairly presented in conformity with GAAP, the consolidated
financial position of the Guarantor and its Consolidated Subsidiaries as of such dates and their consolidated results of operations and cash flows for such periods ending on such dates. 

        (b)  The
assumptions used in preparing the Projections were made in good faith and are reasonable as of the date of such Projections and as of the date hereof. 

        (c)  Since
December 31, 2000, there has been no development or condition that has had, or could reasonably be expected to result in, a Material Adverse Effect
(assuming that the transactions contemplated by the Other NEG Guarantees shall have occurred). 

        3.05.    Litigation.    Except as set forth on Schedule 3.05, there is no action, suit or proceeding pending
against, or to the Actual Knowledge of the Guarantor threatened against or affecting, the Guarantor or any of its Subsidiaries (other than Unrestricted Subsidiaries) before any court or arbitrator or
any governmental body, agency or official in which an adverse decision is reasonably likely to result in a Material Adverse Effect or call into question the enforceability of this Guarantee and
Agreement. 

        3.06.    Federal Reserve Regulations.    (a) Neither the Guarantor nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending, credit for the purpose of purchasing or carrying Margin Stock. 

        (b)  Not
more than 25% of the value of the assets of the Guarantor is represented by Margin Stock. 

        3.07.    Investment Company Act; Public Utility Holding Company Act.    (a) Neither the Guarantor nor any of
its Subsidiaries is an "investment company" as defined in, or subject to regulation under, the Investment Company Act of 1940. 

        (b)  The
Guarantor is not a "holding company" but is a "subsidiary company" and an "affiliate" of a "holding company", the Parent, that is exempt from all provisions, except
Section 9(a)(2), of the Public Utility Holding Company Act of 1935, as amended, and the execution, delivery and performance by the Guarantor of this Guarantee and Agreement and its obligations
hereunder do not violate any provision of such Act or any rule or regulation thereunder. 

        3.08.    No Material Misstatements.    The reports, financial statements and other written information furnished by or
on behalf of the Guarantor to the Security Agent or any Lender pursuant to or in connection with this Guarantee and Agreement do not contain, when taken as a whole, any untrue statement of a material
fact and do not omit, when taken as a whole, to state any fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading in any material
respect. 

        3.09.    Taxes.    The Guarantor has filed or caused to be filed all Federal and material state and local tax returns
which to its Actual Knowledge are required to be filed by it, and has paid or caused to be paid all material taxes shown to be due and payable on such returns or on any assessments received by it,
other than any taxes or assessments the validity of which is being contested in good faith by appropriate proceedings and with respect to which appropriate accounting reserves have to the extent
required by GAAP been set aside. Each Subsidiary of the Guarantor (other than any Unrestricted Subsidiary) has filed or caused to be filed all Federal and material state and local tax returns which to
the Actual Knowledge of the Guarantor or such Subsidiary are required to be filed by such Subsidiary, and has paid or caused to be paid all material taxes shown to be due and payable on such returns
or 

17

 

on any assessments received by it, other than the taxes the failure of which to pay or file a return with respect thereto is not reasonably likely to result in a Material Adverse Effect. 

        3.10.    Employee Benefit Plans.    With respect to each Plan, the Guarantor and its ERISA Affiliates are in
compliance in all material respects with the applicable provisions of ERISA and the Code and the final regulations and published interpretations thereunder. No ERISA Event has occurred that alone or
together with any other ERISA Event has resulted or is reasonably likely to result in a Material Adverse Effect. 

        3.11.    Governmental Approval; Compliance with Law and Contracts.    Each of the Guarantor and its Subsidiaries
(other than Unrestricted Subsidiaries) is in compliance with (a) and has obtained each Governmental Approval applicable to it in respect of this Guarantee and Agreement, the conduct of its
business and the ownership of its property, each of which (i) is in full force and effect, (ii) is sufficient for its purpose without any material restraint or adverse condition and
(iii) is not subject to any waiting period, further action on the part of any Governmental Authority or other Person, or stay or injunction, (b) all applicable laws relating to its
business and (c) each indenture, agreement or other instrument to which it is a party or by which it or any of its property is or may be bound that is material to the conduct of its business,
except in each such case for noncompliances which, and Governmental Approvals the failure to possess which, are not, singly or in the aggregate, reasonably likely to result in a Material Adverse
Effect. 

        3.12.    Environmental Matters.    Except as set forth in Schedule 3.12 or as set forth in or contemplated by
the financial statements or other reports of the type referred to in Section 3.04 hereof and which have been delivered to the Administrative Agent on or prior to the date hereof, the Guarantor
and each of its Subsidiaries (other than Unrestricted Subsidiaries) have complied in all material respects with all Federal, state, local and other statutes, ordinances, orders, judgments, rulings and
regulations relating to environmental pollution or to environmental or nuclear regulation or control, except to the extent that failure to so comply is not reasonably likely to result in a Material
Adverse Effect. Except as set forth in or contemplated by such financial statements or other reports, neither the Guarantor nor any of its Subsidiaries (other than Unrestricted Subsidiaries) has
received notice of any material failure so to comply, except where such failure is not reasonably likely to result in a Material Adverse Effect. Except as set forth in or contemplated by such
financial statements or other reports, no facilities of the Guarantor or any of its Subsidiaries (other than Unrestricted Subsidiaries) are used to manage any hazardous wastes, hazardous substances,
hazardous materials, toxic substances, toxic pollutants or substances similarly denominated, as those terms or similar terms are used in the Resource Conservation and Recovery Act, the Comprehensive
Environmental Response Compensation and Liability Act, the Hazardous Materials Transportation Act, the Toxic Substance Control Act, the Clean Air Act, the Clean Water Act or any other applicable law
relating to environmental pollution, or any nuclear fuel or other radioactive materials, in violation of any law or any regulations promulgated pursuant thereto, except to the extent that such
violations, individually or in the aggregate, are not reasonably likely to result in a Material Adverse Effect. Except as set forth in or contemplated by such financial statements or other reports,
the Guarantor is aware of no events, conditions or circumstances involving environmental pollution or contamination that are reasonably likely to result in a Material Adverse Effect. 

        3.13.    Ranking.    Under applicable laws in force on the date hereof, the claims and rights of the Security Agent
under this Guarantee and Agreement in respect of the Guaranteed Obligations shall not be subordinate to, and shall rank at least pari passu in all respects with, the claims and rights of any other
holders of unsecured Indebtedness of the Guarantor. 

        3.14.    Unrestricted Subsidiaries.    All Unrestricted Subsidiaries designated as such on the date hereof are
identified on Schedule 3.14. 

18

   
        3.15.    Separateness from PG&E.    (a) The Guarantor has operated as a business entity separate and
distinct
in all relevant respects from PG&E Corp. and PG&E such that the Guarantor believes there exists no reasonable basis for a substantive consolidation of NEG LLC with either PG&E Corp. or PG&E in the
event of a bankruptcy proceeding with respect to either of such Persons. 

        (b)  Any
transfer of assets or funds from PG&E Corp. or PG&E (either directly or through PG&E Corp.) to the Guarantor during the period from the date of the Guarantor's
incorporation on December 18, 1998 until the date hereof (i) was for reasonably equivalent value, (ii) was received by the Guarantor in good faith and for value and
(iii) was made without intent to hinder, delay or defraud creditors of the transferor. 

SECTION IV COVENANTS  

        The Guarantor covenants and agrees with the Security Agent and the Lenders that, from and after the date of this Guarantee and Agreement until the Guaranteed
Obligations and the Commitments shall have terminated: 

        4.01.    Maintenance of Ownership.    The Guarantor shall continue (x) to own at least 50% of the equity
ownership interests of, and (y) control the management and operations of, each of its Restricted Subsidiaries (except for certain Restricted Subsidiaries listed on Schedule 4.01);  provided that (I) the Guarantor will in any event continue to own at least 80% of the equity ownership interests of ET Holdings and GTN, and
(II) the Guarantor will continue to own (i) prior to the PG&E Gen Credit Agreement Refinancing Date, 100% of the equity ownership interests of PG&E Gen; and (ii) thereafter, at
least 80% of the equity ownership interests of PG&E Gen; provided, further, that the Guarantor may wind up, dissolve or liquidate any Restricted
Subsidiary (other than PG&E Gen, ET Holdings and GTN) without complying with the foregoing, so long as assets thereof are transferred or otherwise conveyed to another Restricted Subsidiary or the
Guarantor. 

        4.02.    Existence.    The Guarantor will, and will cause each of its Subsidiaries (other than Unrestricted
Subsidiaries) to, do or cause to be done all things necessary to preserve and keep in full force and effect its legal existence and all rights, licenses, permits, franchises and authorizations
necessary or desirable in the normal conduct of its business, except as otherwise permitted pursuant to Sections 4.01 (including Schedule 4.01) and 4.09, and in the case of any such
Subsidiaries, except as such failure to so
preserve or to keep its legal existence and such rights, licenses, permits, franchises or authorizations in full force and effect is not reasonably likely to result in a Material Adverse Effect. 

        4.03.    Compliance with Law; Business and Properties.    The Guarantor will, and will cause each of its Restricted
Subsidiaries to, comply with all applicable material laws, rules, regulations and orders of any Governmental Authority, whether now in effect or hereafter enacted, except where the validity or
applicability of such laws, rules, regulations or orders is being contested by appropriate proceedings in good faith or where such non-compliance is not reasonably likely to result in a
Material Adverse Effect; comply with the terms of each indenture, agreement or other instrument to which it is a party and enforce all of its rights thereunder, except to the extent that noncompliance
or failure to enforce is not reasonably likely to cause a Material Adverse Effect; and at all times maintain and preserve all property material to the conduct of its business and keep such property in
good repair, working order and condition and from time to time make, or cause to be made, all needful and proper repairs, renewals, additions, improvements and replacements thereto necessary in order
that the business carried on in connection therewith may be properly conducted at all times, except where the failure to take any such actions is not reasonably likely to result in a Material Adverse
Effect. 

19

 

        4.04.    Financial Statements, Reports, Etc.    The Guarantor will furnish to the Security Agent, which will promptly
forward the same to each Lender: 

        (a)  as
soon as available and in any event within 120 days after the end of each fiscal year of the Guarantor, a consolidated balance sheet of the Guarantor and its
Consolidated Subsidiaries as of the end of such fiscal year and the related consolidated statements of income, retained earnings and cash flows for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, to the extent available, all reported on by an independent public accountant of nationally recognized standing; 

        (b)  as
soon as available and in any event within 45 days after the end of each of the first three quarters of each fiscal year of the Guarantor a consolidated balance
sheet of the Guarantor and its Consolidated Subsidiaries as of the end of such quarter and the related consolidated statements of income for such quarter and for the portion of the Guarantor's fiscal
year ended at the end of such quarter, and the related consolidated statement of cash flows for such quarter and for the portion of the Guarantor's fiscal year ended at the end of such quarter, in
each case setting forth comparative figures for the previous dates and periods, to the extent available, all certified (subject to normal year-end adjustments) as to fairness of
presentation, GAAP and consistency by a Financial Officer of the Guarantor; 

        (c)  simultaneously
with any delivery of each set of financial statements referred to in paragraphs (a) and (b) above, (i) an unconsolidated balance
sheet of the Guarantor and the related unconsolidated statements of income, retained earnings and cash flows as of the same date and for the same periods
applicable to the statements delivered pursuant to paragraph (a) or (b) above, as applicable, all certified (subject to normal year-end adjustments in the case of quarterly
statements) as to fairness of presentation by a Financial Officer of the Guarantor and (ii) a certificate of a Financial Officer of the Guarantor (A) setting forth in reasonable detail
the calculations required to establish whether the Guarantor was in compliance with the requirements of Section 4.15 on the date of such financial statements, and schedules setting forth all
Indebtedness described in Section 4.12(o) that was incurred during the applicable period and (B) stating whether any NEG Trigger Event or Incipient NEG Trigger Event exists on the date
of such certificate and, if any NEG Trigger Event or Incipient NEG Trigger Event then exists, setting forth the details thereof and the action which the Guarantor is taking or proposes to take with
respect thereto; 

        (d)  simultaneously
with the delivery of each set of financial statements referred to in paragraph (a) above, a statement of the firm of independent public accountants
which reported on such statements confirming the calculations set forth in the Financial Officer's certificate delivered simultaneously therewith pursuant to subsection (c) above; 

        (e)  promptly
upon a Responsible Officer of the Guarantor obtaining Actual Knowledge of the occurrence of any NEG Trigger Event or Incipient NEG Trigger Event, a certificate
of a Financial Officer of the Guarantor setting forth the details thereof and the action which the Guarantor is taking or proposes to take with respect thereto; 

        (f)    on
or prior to the date of incurrence of any Indebtedness pursuant to Section 4.12(c) or (l) or the date of any Distribution pursuant to
Section 4.14, (i) a certificate of a Financial Officer of the Guarantor setting forth in reasonable detail the calculations demonstrating compliance by the Guarantor with the applicable
financial tests, together with the pro forma calculations referred to in the applicable Section, and copies of all financial statements and other supporting documents and reports, if any, upon which
the Guarantor relied in making such calculations, and (ii) with respect to Section 4.12(c) and (l) only, written evidence of the confirmation of the rating agency ratings, to the
extent such confirmation is required under Section 4.12 (c) or (l), as the case may be; 

20

 

        (g)  (i) on
or prior to the date hereof, copies of the PG&E Gen Credit Agreements, ET Credit Agreements, GTN Credit Agreements, and USGenNE Credit Agreements, in each
case accompanied by a certificate of a Responsible Officer of the Guarantor stating that such copies are true and complete, and (ii) promptly upon any refinancing of the loans under any such
facility, copies of the refinancing documents, accompanied by a certificate of a Responsible Officer of the Guarantor stating that such copies are true and complete; and 

        (h)  on
each date Loans are to be made pursuant to the Credit Agreement, a certificate to the effect that the representations and warranties made by the Guarantor and
contained in Section III hereof are true and correct in all material respects as of such date, except to the extent made with respect to an
earlier date, in which case such representations and warranties shall have been true and correct in all material respects as of such earlier date. 

        4.05.    Insurance.    The Guarantor will, and will cause each of its Subsidiaries (other than Unrestricted
Subsidiaries) to, maintain such insurance or self insurance, to such extent and against such risks, including fire and other risks insured against by extended coverage, as is customary with companies
similarly situated and in the same or similar businesses except, in the case of any such Subsidiaries, where such failure to so maintain is not reasonably likely to result in a Material Adverse
Effect. 

        4.06.    Taxes, Etc.    The Guarantor will, and will cause each of its Subsidiaries (other than Unrestricted
Subsidiaries) to, pay and discharge promptly when due all material taxes, assessments and governmental charges imposed upon it or upon its income or profits or in respect of its property, in each case
before the same shall become delinquent or in default and before penalties accrue thereon, unless and to the extent that the same are being contested in good faith by appropriate proceedings and
adequate reserves with respect thereto shall, to the extent required by GAAP, have been set aside except, in the case of any such Subsidiaries, where such failure to so pay or discharge is not
reasonably likely to result in a Material Adverse Effect. 

        4.07.    Maintaining Records; Access to Properties and Inspections.    The Guarantor will, and will cause each of its
Restricted Subsidiaries to, maintain financial records in accordance with GAAP and, upon reasonable notice and at reasonable times, permit authorized representatives designated by the Administrative
Agent or the Security Agent to visit and inspect its properties, books and records and to discuss its affairs, finances and condition with its officers. 

        4.08.    Risk Management Procedures.    The Guarantor will, and will cause each of its Restricted Subsidiaries to,
maintain in effect prudent risk management procedures with respect to Trading Arrangements and Swaps. 

        4.09.    Merger.    The Guarantor will not consolidate or merge with or into any Person, or sell, lease or otherwise
transfer, in a single transaction or in a series of transactions, all or substantially all of its assets to any Person or Persons, unless (i) the surviving Person or transferee is formed under
the laws of a State of the United States of America and assumes or is responsible by operation of law for all the Guaranteed Obligations and (ii) no NEG Trigger Event, Incipient NEG Trigger
Event or NEG Downgrade Event shall have occurred or be continuing at the time of or after giving effect to such consolidation or merger or transfer. 

        4.10.    Investments.    The Guarantor will not make any Investment, or permit any of its Restricted Subsidiaries to
make any Investment, except: 

        (a)  Investments
in any Restricted Subsidiary, Investment Vehicle or Asset Company (or any Person that will become a Restricted Subsidiary, Investment Vehicle or Asset
Company, as the case may be, upon the making of such Investment); or 

21

 

        (b)  Investments
(not otherwise permitted under this Section 4.10) existing on the date of execution of Guarantee and Agreement which are identified on a
Schedule 4.10; or 

        (c)  Investments
permitted to be incurred as Indebtedness under Section 4.12; or 

        (d)  (i) Investments
made by any Restricted Subsidiary in the Guarantor or any Restricted Subsidiary in connection with the Guarantor's cash management program or
(ii) Investments in Cash Equivalents; or 

        (e)  Investments
constituting "Equity Funding Arrangements" permitted hereunder; or 

        (f)    Investments
otherwise made by the Guarantor and its Restricted Subsidiaries in the ordinary course of business as conducted by the Guarantor or its Restricted
Subsidiaries or by other Persons in the energy trading, energy services, power generation, electric transmission or gas transmission and storage businesses (including technologies related to such
businesses); or 

        (g)  Investments
in connection with obligations in support of Trading Arrangements; or 

        (h)  Investments
in any Unrestricted Subsidiary with amounts which would otherwise be available for distribution in accordance with Section 4.14. 

        4.11.    Liens.    The Guarantor will not create or assume or permit to exist any Lien, or permit any Restricted
Subsidiary, Investment Vehicle or Asset Company to, create or assume or permit to exist any Lien, in respect of any of its property or assets of any kind (real or personal, tangible or intangible),
except: 

        (a)  Liens
granted pursuant to Lease Obligations described in clause (i) of the definition of "Lease Obligations" and permitted by Section 4.12; or 

        (b)  Liens
on cash collateral securing Equity Funding Arrangements, Credit Support Arrangements, Investments or Indebtedness permitted hereunder; or 

        (c)  Liens
in favor of the administrative agent under the PG&E Gen Credit Agreement on funds in the "Cash Collateral Account" and on the "Cash Collateral Account" to secure
the reimbursement obligations of PG&E Gen in respect of letters of credit as provided for in the PG&E Gen Credit Agreement; or 

        (d)  Liens
existing on the assets of any Person at the time such Person becomes a Subsidiary of the Guarantor; or 

        (e)  Liens
on the equity or ownership interests of any Asset Company or any Investment Vehicle which owns such Asset Company and Liens on any Equity Funding Arrangements
securing the applicable Project Financing Facility; or 

        (f)    Liens
on any of the assets of any Asset Company or Investment Vehicle securing or in connection with the applicable Project Financing Facility; or 

        (g)  Liens
on any asset of the Guarantor or any Restricted Subsidiary incurred or assumed for the purpose of financing all or any part of the cost of acquiring, constructing
or improving such asset, provided that such Lien attaches contemporaneously with, or within 12 months of, the purchase, construction or
improvement of such asset; or 

        (h)  Liens
with respect to the assets of and membership interests or other equity interests in ET Holdings and its Subsidiaries to secure the NEG/ET Letter of Credit
Facilities; or 

        (i)    Other
Liens (not otherwise permitted under this Section 4.11) existing as of the date of this Guarantee and Agreement and identified on Schedule 4.11; or 

        (j)    Permitted
Encumbrances; or 

22

 

        (k)  without
limiting the ability to incur Liens under the other subsections of this Section 4.11, extensions or renewals of any Lien otherwise permitted to be
incurred under this Section 4.11 securing Indebtedness in an amount not exceeding the principal amount of, and accrued interest on, the Indebtedness secured by such Lien as so extended or
renewed at the time of such extension or renewal; provided that such Lien shall apply only to the same property theretofore subject to the same and
fixed improvements constructed thereon. 

        4.12.    Indebtedness.    The Guarantor will not incur, create, assume or permit to exist Indebtedness, or permit any
Restricted Subsidiary, Investment Vehicle or Asset Company to, incur, create, assume or permit to exist Indebtedness, except: 

        (a)  Indebtedness
under (i) the USGenNE Credit Agreements, the GTN Credit Agreements, the ET Credit Agreements and NEG/ET Letter of Credit Facilities (the
"Refinanceable Facilities") and (ii) the PG&E Gen Credit Agreements and the other credit facilities entered into by the Guarantor or any
Restricted Subsidiary prior to the date of this Guarantee and Agreement and identified on Schedule 4.12(a); provided, that this subsection
(a) shall not be deemed to permit an amendment to the facilities referred to in this subsection (a) which has the effect of increasing the available commitments thereunder or, in the
case of the PG&E Gen Credit Agreements, extending the maturity of the loans thereunder; or 

        (b)  Lease
Obligations (1) under leases for any office buildings in which the Guarantor or any of its Subsidiaries has or will have offices; (2) under leases
for any equipment not to exceed $10,000,000 in the aggregate outstanding at any time; or (3) described in clause (i) of the definition thereof of the Guarantor and its Restricted
Subsidiaries if, immediately after the incurrence of any such Lease Obligation, the outstanding aggregate principal amount of all such Lease Obligations (other than those Lease Obligations incurred
under subsections (c), (j), (l) and (q) below) would not exceed 2% of Consolidated Tangible Net Assets; or 

        (c)  Indebtedness
of (i) any Asset Company under any Project Financing Facility or (ii) any Investment Vehicle under any Project Financing Facility;  provided, that if any Asset Company owned (directly or
indirectly) by such Investment Vehicle has incurred any Indebtedness under a Project Financing
Facility, then such Investment Vehicle may only incur Indebtedness under a Project Financing Facility if (I)(x) after giving effect to such Indebtedness, the Ratio of Cash Flow to Fixed Charges
of the Guarantor would not be less than 2.0:1.0, calculated on a pro forma basis to include such Indebtedness and related cash flows, (y) the Guarantor's senior unsecured long-term
debt is, at the time of such incurrence, rated at least BBB by S&P and Baa2 by Moody's (or if ratings of such debt have not been issued by such rating agencies, such debt is impliedly rated by an
issuer rating or indicative rating of at least BBB by S&P and Baa2 by Moody's), and (z) the Guarantor obtains a reaffirmation of such ratings from S&P and Moody's (taking into account the
Indebtedness to be incurred by such Investment Vehicle under this Section 4.12(c)) or (II) such Investment Vehicle owns only one Asset Company and such Indebtedness is incurred in
connection with a Project Financing Facility and the proceeds thereof are promptly invested in such Asset Company; or 

        (d)  Trading
Arrangements and Credit Support Arrangements, to the extent such arrangements constitute Indebtedness; or 

        (e)  Indebtedness
with respect to any securitization, receivables financing or similar transaction entered into by ET Holdings, GTN, USGenNE or any of their respective
Subsidiaries; or 

        (f)    Indebtedness
not otherwise permitted under this Section 4.12, existing on the date of this Guarantee and Agreement and set forth on Schedule 4.12(f); or 

        (g)  Indebtedness
under any Swap; or 

23

 

        (h)  Permitted
Subordinated Indebtedness; or 

        (i)    Indebtedness
between any of the Guarantor, any Restricted Subsidiary, Investment Vehicle, any Asset Company or any Indebtedness under any short-term
overdraft lines of credit or similar arrangements entered into in the ordinary course of business, in each case associated with the Guarantor's cash management program; or 

        (j)    Indebtedness
attributable to any Permitted Sale-Leaseback Transactions; or 

        (k)  Any
Guaranty constituting Indebtedness of the Guarantor or any Restricted Subsidiary, Investment Vehicle or Asset Company under clause (ix) of the definition of
"Indebtedness" to the extent that the obligations covered by such Guaranty are not reasonably quantifiable under GAAP; or 

        (l)    other
Indebtedness of the Guarantor or any Restricted Subsidiary (other than PG&E Gen) incurred after the date of this Guarantee and Agreement,  provided that (i) after giving effect to any such
Indebtedness, the Ratio of Cash Flow to Fixed Charges of the Guarantor would not be less than
2.0:1.0 (calculated on a pro forma basis as of the end of the most recent fiscal quarter with respect to which financial statements of the Guarantor are available and assuming for such purpose that
such Indebtedness was incurred one year prior to the end of such fiscal quarter and taking into account any related cash flows) and (ii) if such Indebtedness would constitute Indebtedness of a
Restricted Subsidiary, no Asset Company, Investment Vehicle or Restricted Subsidiary owned directly or indirectly by such Restricted Subsidiary has Indebtedness outstanding which would otherwise be
permitted under Section 4.12(a), (b)(3), (c), (h), (j), (l), (o) or (p); provided, further, that clause (ii) of this
Section 4.12(l)
will not be applicable if the Guarantor obtains a reaffirmation of the rating of its senior unsecured long-term debt of at least BBB by S&P and Baa2 by Moody's (or if ratings of such debt
have not been issued by such rating agencies, such debt is impliedly rated by an issuer rating or indicative rating of at least BBB by S&P and Baa2 by Moody's) after taking into account the
Indebtedness to be incurred by such Restricted Subsidiary and related cash flows; or 

        (m)  Indebtedness
of the Guarantor or any Restricted Subsidiary in respect of letters of credit or surety, performance or bid bonds used in the ordinary course of business
not in excess of $25,000,000 in the aggregate outstanding at any time; or 

        (n)  Indebtedness
constituting intercompany loans (1) between the Guarantor and its Restricted Subsidiaries or between such Restricted Subsidiaries or (2) made
by the Guarantor, any Restricted Subsidiary, any Investment Vehicle or any Asset Company to any Investment Vehicle or any Asset Company or (3) made by any Investment Vehicle to the Guarantor,
any Restricted Subsidiary, or any other Investment Vehicle; or 

        (o)  Equity
Funding Arrangements; or 

        (p)  without
limiting the ability to incur Indebtedness under the other subsections of this Section 4.12, any refinancing of any Indebtedness permitted under
Section 4.12(f) and under the Refinanceable Facilities, provided that either (i) (x) the average life of any refinanced Indebtedness shall
not be less than the average life of the Indebtedness so refinanced (plus fees and expenses, including any premium or defeasance costs, of such refinancing), taking into account the prepayment or
repayment of a portion of any such Indebtedness, and (y) the principal amount of the refinanced Indebtedness shall not exceed the principal amount plus accrued interest thereon of the
Indebtedness so refinanced, or (ii) the Guarantor shall demonstrate pro forma compliance with the financial ratio described in Section 4.12(l) above; or 

24

 

        (q)  Indebtedness
of any Subsidiary of the Guarantor existing at the time such Person becomes a Subsidiary of the Guarantor (except for any such Indebtedness of such
Subsidiary incurred in contemplation of or to finance the acquisition of such Subsidiary); or 

        (r)  Indebtedness
of the Guarantor incurred in connection with a refinancing of any Indebtedness of PG&E Gen under the PG&E Gen Credit Agreements in an aggregate principal
amount not to exceed $1,250,000,000. 

        4.13.    Transactions with Affiliates.    The Guarantor will not enter into, or permit any Restricted Subsidiary,
Investment Vehicle or Asset Company to enter into, any transaction with any Affiliate of the Guarantor (other than the Guarantor, any Subsidiary of the Guarantor, any Investment Vehicle and any Asset
Company), except: 

        (a)  transactions
with such Affiliates upon fair and reasonable terms which are no less favorable to the Guarantor than would be obtained in a comparable arm's length
transaction with a Person not an Affiliate of the Guarantor; 

        (b)  management,
operating, sharing or other similar services arrangements between and among the Guarantor, its Subsidiaries and its other Affiliates either existing on the
date hereof and described on Schedule 4.13 or entered into after the date hereof on commercially reasonable terms; 

        (c)  tax
sharing arrangements between the Guarantor and PG&E Corp. approximating the tax position that the Guarantor would be in if it were not part of PG&E Corp.'s
consolidated group, as determined by the management of the Guarantor in its reasonable business judgment or such other arrangements as may be approved by the Lenders prior to the date hereof; or 

        (d)  paying
or declaring any Distribution to the extent permitted under Section 4.14. 

        The
provisions of this Section 4.13 shall not apply to (i) transactions between the Guarantor or any of its Subsidiaries, on the one hand, and any employee of the Guarantor
or any of its Subsidiaries, on the other hand, that are approved by the Board of Directors of the Guarantor or any committee of the Board of Directors and (ii) the payment of reasonable and
customary regular fees to directors of the Guarantor or any Subsidiary of the Guarantor. 

        4.14.    Distributions.    The Guarantor will not declare or make any Distribution if (a) an NEG Trigger Event,
Incipient NEG Trigger Event or NEG Downgrade Event has occurred and is continuing or shall occur after giving effect to such Distribution, (b) the Ratio of Cash Flow to Fixed Charges of the
Guarantor determined as of the end of the immediately preceding fiscal quarter was not at least 2.0:1.0 or (c) the Guarantor fails to satisfy the requirements of the test set forth in
Section 4.15(b), or the Guarantor fails to have a Consolidated Net Worth of at least $2.15 billion, in each case calculated on a pro forma  basis as of the end of the most recent fiscal period
with respect to which financial statements of the Guarantor are available (assuming such Distribution and all material
events with respect to the Guarantor and its Subsidiaries which occurred after the end of such fiscal period had occurred on the last day of such fiscal period); provided  that the Guarantor may declare
and make Distributions of assets of or equity ownership interests in any Unrestricted Subsidiary at any time without complying with the
foregoing. 

        4.15.    Financial Covenants.    (a) The Guarantor shall not, as of the end of each fiscal quarter, permit the
Ratio of Cash Flow to Fixed Charges to be less than 1.5:1.0. 

        (b)  The
Guarantor shall not, as of the end of each fiscal quarter, permit the Ratio of Debt to Capitalization to be greater than 0.6:1.0. 

25

 

        (c)  The
Guarantor shall not, at the end of each fiscal quarter, permit (i) Consolidated Net Worth to be less than the Minimum Consolidated Net Worth and
(ii) Non-Trading Consolidated Net Worth to be less than the Minimum Non-Trading Consolidated Net Worth. 

        4.16.    Separateness from PG&E Corp.    The Guarantor shall (i) maintain adequate capital in light of the
business in which it is engaged; (ii) maintain books and corporate records separate from PG&E Corp. and PG&E; (iii) not commingle assets with PG&E Corp. or PG&E; and (iv) conduct
business in its own name and hold itself out as separate from PG&E Corp. and PG&E. The Guarantor shall promptly notify the Security Agent upon a Responsible Officer of the Guarantor obtaining Actual
Knowledge that a creditor of PG&E Corp. or of PG&E has made a claim or filing in writing seeking the substantive consolidation of NEG LLC in any bankruptcy proceeding of PG&E Corp. or of PG&E. 

        4.17.    PG&E Gen Credit Agreement Covenants.    Prior to the PG&E Gen Credit Agreement Refinancing Date, the
Guarantor will not permit PG&E Gen to default in any material respect in the due observance or performance of its covenants under Sections 5.08, 5.11, 5.12, 5.13 and 5.14 of the $1.1 Billion PG&E Gen
Credit Agreement. 

SECTION V NEG TRIGGER EVENTS  

        5.01.    NEG Trigger Events.    The following shall constitute NEG Trigger Events: 

        (a)  any
Event of Default; or 

        (b)  any
representation or warranty made or deemed made by (1) the Guarantor in or in connection with the execution and delivery of this Guarantee and Agreement, or
(2) NEG LLC in the Letter
Agreement, shall prove to have been false or misleading in any material respect when so made, deemed made or furnished; or 

        (c)  the
Guarantor shall default in any material respect in the due observance or performance of any agreement contained in Section 4.01, Section 4.09,
Section 4.14 or Section 4.15; or 

        (d)  (1)
the Guarantor shall default in any material respect in the due observance or performance of any covenant, condition or agreement contained in this Guarantee and
Agreement (other than those specified in 5.01(c) above), or (2) NEG LLC shall default in any material respect in the due observance or performance of any covenant, condition or agreement
contained in the Letter Agreement, and in each case, such default shall continue unremedied for a period of 30 days after notice thereof from the Security Agent; or 

        (e)  the
Guarantor or any Restricted Subsidiary shall default in respect of any Indebtedness or default in its obligations to make payments when due under any Equity Funding
Arrangements which at the time have an aggregate principal amount outstanding or, in the case of Equity Funding Arrangements, due and unpaid, in excess of $50,000,000, and as a result thereof such
Indebtedness shall have been accelerated or otherwise be or become due or subject to prepayment in full prior to its stated maturity; or 

        (f)    an
involuntary proceeding shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (i) relief in respect of the
Guarantor or any Restricted Subsidiary or of a substantial part of the property or assets of the Guarantor or any Restricted Subsidiary under Title 11 of the United States Code, as now constituted or
hereafter amended, or any other Federal or state bankruptcy, insolvency, receivership or similar law, (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or
similar official for the Guarantor or any Restricted Subsidiary or (other than in connection with any proceeding relating solely to one or more Unrestricted Subsidiaries, Investment Vehicles or
Project Companies of the Guarantor) for a substantial part of the property or assets of the Guarantor or any Restricted Subsidiary or (iii) the winding up or liquidation of the Guarantor or any
Restricted Subsidiary; and such 

26

 

proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered; or 

        (g)  the
Guarantor or any Restricted Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking relief under Title 11 of the United States
Code, as now constituted or hereafter amended, or any other Federal or state bankruptcy, insolvency, receivership or similar law, (ii) consent to the institution of, or fail to contest in a
timely and appropriate manner, any proceeding or the filing of any petition described in Section 5.01(f) above, (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar official for the Guarantor or any Restricted Subsidiary (other than in connection with any proceeding relating solely to one or more Unrestricted
Subsidiaries, Investment Vehicles or Project Companies of the Guarantor) for a substantial
part of the property or assets of the Guarantor or any Restricted Subsidiary, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding,
(v) make a general assignment for the benefit of creditors, or (vi) take any corporate action for the purpose of effecting any of the foregoing, become unable, admit in writing its
inability, or fail generally, to pay its debts as they become due; or 

        (h)  one
or more final judgments for the payment of money in an aggregate amount in excess of $50,000,000 (exclusive of amounts covered by insurance) shall be rendered
against the Guarantor or any Restricted Subsidiary and such judgment or order shall remain undischarged, unbonded or unstayed for a period of 60 days; or 

        (i)    an
ERISA Event shall have occurred that, either alone or in combination with other ERISA Events that shall have occurred, is reasonably likely to result in a Material
Adverse Effect. 

SECTION VI MISCELLANEOUS  

        6.01.    Amendments.    No provision of this Guarantee and Agreement may be amended or waived except in accordance
with Section 11.1 of the Credit Agreement. 

        6.02.    Successors and Assigns.    This Guarantee shall bind and benefit the successors and permitted assigns of
Guarantor and Security Agent and inure to the benefit of the Lenders and their successors and permitted assigns. This Guarantee shall not be deemed to benefit any Person except Security Agent and the
Lenders and their successors and permitted assigns. 

        6.03.    GOVERNING LAW.    THIS GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. THE GUARANTOR IRREVOCABLY SUBMITS, FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION RELATING TO THIS GUARANTEE, OR FOR
RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF OR THEREOF, TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK.

        6.04.    No Waiver, Cumulative Remedies.    (a) No failure to exercise, nor any delay in exercising, on the
part of the Security Agent or any Lender, any right, power or privilege hereunder shall operate as a waiver thereof. No single or partial exercise of any right, power or privilege hereunder shall
preclude any other or further exercise thereof or the exercise of any other right, power or privilege. A waiver by the Security Agent or any Lender of any right or remedy hereunder on any one occasion
shall not be
construed as a bar to any right or remedy that the Security Agent or such Lender would otherwise have on any future occasion. 

        (b)  The
rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights or remedies provided by law. 

        6.05.    Authority and Rights of Security Agent.    The Guarantor acknowledges that the rights and responsibilities of
the Security Agent under this Guarantee and Agreement with respect to any action 

27

 

taken by the Security Agent or the exercise or non-exercise by the Security Agent of any option, right, request, judgment or other right or remedy provided for herein or resulting or
arising out of this Guarantee and Agreement shall, as between the Security Agent and the Lenders, be governed by the Loan Documents and by such other agreements with respect thereto as may exist from
time to time among them, but, as between the Security Agent and the Guarantor, the Security Agent shall be conclusively presumed to be acting with full and valid authority so to act or refrain from
acting, and the Guarantor shall not be under any obligation, or entitlement, to make any inquiry respecting such authority. The Security Agent shall be afforded the rights, privileges and immunities
set forth in Section 10 of the Credit Agreement as if fully set forth herein. 

28

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

	 	 	PG&E NATIONAL ENERGY GROUP, INC.
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:

	Agreed and Accepted:	 	 
	
SOCIÉTÉ GÉNÉRALE, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY IN ITS CAPACITY AS SECURITY AGENT, ON BEHALF OF THE LENDERS	
 	

 
	

By:	

 	
 	

 
	 	
 Name:

Title:	 	 
	

Schedules omitted

	
 	

 

QuickLinks

Exhibit 10.8QuickLinks
 -- Click here to rapidly navigate through this document

Execution Version  

  
 

    Exhibit 10.9    
  

AMENDED AND RESTATED CREDIT AGREEMENT  

among 

GENHOLDINGS I, LLC,
  a Delaware limited liability company

(Borrower) 

	SOCIETE GENERALE
 (Lead Arranger and

Administrative Agent)	 	CITIBANK, N.A.
 (Lead Arranger and

Syndication Agent)

THE OTHER AGENTS AND ARRANGERS LISTED

ON THE SIGNATURE PAGES HERETO
  (Arrangers) 

JPMORGAN CHASE BANK
  (LC Bank) 

THE FINANCIAL INSTITUTIONS PARTY

HERETO FROM TIME TO TIME AS BANKS
  (Banks) 

THE PERSONS PARTY HERETO FROM

TIME TO TIME AS CP CONDUITS
  (CP Conduits) 

THE FINANCIAL INSTITUTIONS PARTY HERETO

FROM TIME TO TIME AS RELATED BANKS
  (Related Banks) 

THE FINANCIAL INSTITUTIONS PARTY HERETO

FROM TIME TO TIME AS LENDER GROUP AGENTS
  (Lender Group Agents) 

Dated as of March 15, 2002  

 
 TABLE OF CONTENTS  

	 
	 	 
	 	 
	 	Page

	ARTICLE 1.    DEFINITIONS; RULES OF INTERPRETATION	 	1
	 	

1.1	
 	

Definitions	
 	

1
	 	1.2	 	Rules of Interpretation	 	1
	

ARTICLE 2.    THE CREDIT FACILITIES	
 	

1
	 	

2.1	
 	

Loan Facilities	
 	

1
	 	 	2.1.1	 	Construction Loan Facility	 	1
	 	 	2.1.2	 	Working Capital Loan Facility	 	4
	 	 	2.1.3	 	Interest Provisions Relating to All Loans (including Project LC Loans and DSR LC Loans)	 	6
	 	 	2.1.4	 	Register	 	7
	 	 	2.1.5	 	Promissory Notes	 	9
	 	 	2.1.6	 	Loan Funding	 	9
	 	 	2.1.7	 	Conversion of Loans	 	11
	 	 	2.1.8	 	Prepayments	 	12
	 	2.2	 	Letter of Credit Facilities	 	13
	 	 	2.2.1	 	Issuance of the Letters of Credit	 	13
	 	 	2.2.2	 	Availability	 	14
	 	 	2.2.3	 	Notice of LC Activity	 	14
	 	 	2.2.4	 	Letter of Credit Loans and Reimbursement Obligations	 	15
	 	 	2.2.5	 	Project LC Loan Interest	 	15
	 	 	2.2.6	 	DSR LC Loan Interest	 	16
	 	 	2.2.7	 	Reduction and Reinstatement of Stated Amounts; Cancellation	 	16
	 	 	2.2.8	 	Bank Participation	 	16
	 	 	2.2.9	 	Commercial Practices	 	17
	 	 	2.2.10	 	Reimbursement Obligations Absolute	 	17
	 	 	2.2.11	 	Term of Letters of Credit	 	18
	 	 	2.2.12	 	LC Bank's Right to Replace Non-Investment Grade Bank	 	18
	 	 	2.2.13	 	Special Provisions Relating to Letters of Credit	 	19
	 	2.3	 	Total Commitments	 	19
	 	 	2.3.1	 	Initial Commitments and Increases in Initial Commitments	 	19
	 	 	2.3.2	 	Total Construction Loan Commitment	 	19
	 	 	2.3.3	 	Total Working Capital/Project LC Commitment	 	20
	 	 	2.3.4	 	Total DSR LC Commitment	 	20
	 	 	2.3.5	 	Allocated Portions	 	21
	 	 	2.3.6	 	Reductions and Cancellations	 	22
	 	 	2.3.7	 	Parallel Funding Commitments Termination Date	 	24
	 	2.4	 	Fees	 	26
	 	 	2.4.1	 	Administrative Agent Fees	 	26
	 	 	2.4.2	 	Arranger Fees	 	26
	 	 	2.4.3	 	Commitment Fees	 	26
	 	 	2.4.4	 	Letter of Credit Fee	 	27
	 	 	2.4.5	 	Fronting Fee; LC Administrative Charges	 	27
	 	2.5	 	Other Payment Terms	 	27
	 	 	2.5.1	 	Place and Manner	 	27
	 	 	2.5.2	 	Date	 	27
	 	 	2.5.3	 	Late Payments	 	27
	 	 	2.5.4	 	Net of Taxes, Etc.	 	28
	 	 	2.5.5	 	Application of Payments	 	30

i

 

	 	 	2.5.6	 	Failure to Pay Administrative Agent	 	30
	 	 	2.5.7	 	Withholding Exemption Certificates	 	30
	 	2.6	 	Pro Rata Treatment	 	31
	 	 	2.6.1	 	Loans, Commitment Reductions, Etc.	 	31
	 	 	2.6.2	 	Sharing of Payments, Etc.	 	32
	 	 	2.6.3	 	Payments to Lender Groups	 	32
	 	2.7	 	Change of Circumstances	 	32
	 	 	2.7.1	 	Inability to Determine Rates	 	32
	 	 	2.7.2	 	Illegality	 	33
	 	 	2.7.3	 	Increased Costs	 	33
	 	 	2.7.4	 	Capital Requirements	 	34
	 	 	2.7.5	 	Notice; Participating Banks' and Lender Group Members' Rights	 	34
	 	2.8	 	Funding Losses	 	35
	 	2.9	 	Alternate Office; Minimization of Costs	 	35
	

ARTICLE 3.    CONDITIONS PRECEDENT	
 	

36
	 	

3.1	
 	

Conditions Precedent to the Closing Date	
 	

36
	 	 	3.1.1	 	Resolutions	 	37
	 	 	3.1.2	 	Incumbency	 	37
	 	 	3.1.3	 	Formation Documents	 	37
	 	 	3.1.4	 	Good Standing Certificates	 	37
	 	 	3.1.5	 	Credit Documents	 	37
	 	 	3.1.6	 	UCC Reports	 	37
	 	 	3.1.7	 	UCC Filings	 	38
	 	 	3.1.8	 	Closing Certificates of Borrower and NEG	 	38
	 	 	3.1.9	 	Legal Opinions	 	38
	 	 	3.1.10	 	Preliminary Project Budgets	 	38
	 	 	3.1.11	 	Preliminary Project Schedules	 	38
	 	 	3.1.12	 	Base Case Project Projections	 	38
	 	 	3.1.13	 	Financial Statements	 	38
	 	 	3.1.14	 	Establishment of Accounts	 	39
	 	 	3.1.15	 	Payment of Bank and Consultant Fees	 	39
	 	 	3.1.16	 	Independent Engineer's Final Draft Report and Certificate	 	39
	 	 	3.1.17	 	Fuel Consultant's and Power Market Consultant's Final Reports and Certificates	 	39
	 	 	3.1.18	 	Approved Projects	 	39
	 	 	3.1.19	 	Agent for Service of Process	 	39
	 	 	3.1.20	 	Representations and Warranties	 	39
	 	 	3.1.21	 	No Defaults	 	39
	 	 	3.1.22	 	No Material Adverse Change	 	39
	 	 	3.1.23	 	No Litigation	 	39
	 	 	3.1.24	 	No Change in Tax Laws	 	40
	 	3.2	 	Conditions Precedent to the Initial Borrowing of Construction Loans for a Project	 	40
	 	 	3.2.1	 	Credit Event Conditions	 	40
	 	 	3.2.2	 	Initial Project or Approved Substitute Project	 	40
	 	 	3.2.3	 	Adjustment Date	 	40
	 	 	3.2.4	 	Resolutions	 	40
	 	 	3.2.5	 	Incumbency	 	40
	 	 	3.2.6	 	Formation Documents	 	41
	 	 	3.2.7	 	Good Standing Certificates	 	41
	 	 	3.2.8	 	Operative Documents	 	41
	 	 	3.2.9	 	UCC Reports	 	42

ii

 

	 	 	3.2.10	 	UCC Filings	 	42
	 	 	3.2.11	 	Incremental Commitments and/or Permitted Additional Equity	 	43
	 	 	3.2.12	 	Legal Opinions	 	43
	 	 	3.2.13	 	Insurance	 	43
	 	 	3.2.14	 	Independent Engineer's Final Report and Certificate	 	43
	 	 	3.2.15	 	Reports of the Environmental Consultant	 	43
	 	 	3.2.16	 	Updated Fuel Consultant's Report and Certificate	 	44
	 	 	3.2.17	 	Updated Power Market Consultant's Report and Certificate	 	44
	 	 	3.2.18	 	Permits	 	44
	 	 	3.2.19	 	Financial Statements	 	45
	 	 	3.2.20	 	Base Case Project Projections	 	45
	 	 	3.2.21	 	Project Schedules; Project Budgets; Annual Operating Budgets; Borrower Budget	 	45
	 	 	3.2.22	 	Real Estate Rights; A.L.T.A. Surveys	 	46
	 	 	3.2.23	 	Title Policies	 	46
	 	 	3.2.24	 	Regulatory Status	 	47
	 	 	3.2.25	 	Notice to Proceed	 	47
	 	 	3.2.26	 	Utilities	 	47
	 	 	3.2.27	 	Agent for Service of Process	 	47
	 	 	3.2.28	 	Conditions Applicable Only to the Subject Project	 	47
	 	3.3	 	Conditions Precedent to each Borrowing of Construction Loans	 	47
	 	 	3.3.1	 	Credit Event Conditions	 	47
	 	 	3.3.2	 	Approved Project	 	47
	 	 	3.3.3	 	Construction Requisition	 	47
	 	 	3.3.4	 	Title Policy Endorsement	 	47
	 	 	3.3.5	 	Lien Releases	 	48
	 	 	3.3.6	 	Permits	 	48
	 	 	3.3.7	 	Additional Documentation	 	48
	 	 	3.3.8	 	Acceptable Work; No Liens	 	48
	 	 	3.3.9	 	Casualty	 	49
	 	 	3.3.10	 	Insurance	 	49
	 	 	3.3.11	 	Title Certification	 	49
	 	3.4	 	Conditions Precedent to Borrowings of Working Capital Loans	 	49
	 	3.5	 	Conditions Precedent to the Issuance of Project Letters of Credit	 	49
	 	 	3.5.1	 	Credit Event Conditions	 	50
	 	 	3.5.2	 	Approved Project	 	50
	 	 	3.5.3	 	Notice of LC Activity	 	50
	 	3.6	 	Conditions Precedent to the Issuance of the DSR Letter of Credit	 	50
	 	 	3.6.1	 	Credit Event Conditions	 	50
	 	 	3.6.2	 	Amortization Commencement Date	 	50
	 	 	3.6.3	 	Notice of LC Activity	 	50
	 	3.7	 	Conditions Precedent to the Crediting of Alternatively Sourced Equity Contributions	 	50
	 	 	3.7.1	 	Credit Event Conditions	 	50
	 	 	3.7.2	 	Certification of Available Equity Commitment	 	50
	 	 	3.7.3	 	No Other Project Defaults	 	51
	 	 	3.7.4	 	Approved Project	 	51
	 	 	3.7.5	 	Permitted Application	 	51
	 	 	3.7.6	 	Completion; Available Construction Funds	 	51
	 	 	3.7.7	 	Acceptable Work; No Liens	 	51
	 	3.8	 	Conditions Precedent to Completion	 	51
	 	 	3.8.1	 	Credit Event Conditions	 	51
	 	 	3.8.2	 	Completion of Work	 	51

iii

 

	 	 	3.8.3	 	Substantial Completion; Utility Services	 	52
	 	 	3.8.4	 	Annual Operating Budget	 	52
	 	 	3.8.5	 	Insurance	 	52
	 	 	3.8.6	 	Permits	 	53
	 	 	3.8.7	 	Title Policy	 	53
	 	3.9	 	Conditions Precedent to a Borrowing of Construction Loans to be Used for In Kind Equity Payments	 	53
	 	 	3.9.1	 	Credit Event Conditions	 	53
	 	 	3.9.2	 	Credit Event Date	 	53
	 	 	3.9.3	 	Commitment Reduction	 	53
	 	 	3.9.4	 	Construction Requisition	 	53
	 	 	3.9.5	 	Maximum Amount	 	53
	 	3.10	 	Conditions Precedent to a Borrowing of Construction Loans to be Used for Equity Contribution True-Up Reimbursements and/or NEG EPC Guaranty Reimbursements	 	53
	 	 	3.10.1	 	Credit Event Conditions	 	54
	 	 	3.10.2	 	Credit Event Date	 	54
	 	 	3.10.3	 	Construction Requisition	 	54
	 	 	3.10.4	 	Maximum Amount	 	54
	 	3.11	 	Conditions Precedent to the Substitution of a Project	 	54
	 	 	3.11.1	 	Initial Funding Conditions	 	54
	 	 	3.11.2	 	Approved Project	 	54
	 	 	3.11.3	 	Credit Event Date	 	54
	 	 	3.11.4	 	Credit Event Conditions	 	54
	 	 	3.11.5	 	Ratings	 	54
	 	 	3.11.6	 	Diligence Investigation	 	55
	 	3.12	 	Conditions Precedent to Each Credit Event	 	55
	 	 	3.12.1	 	Representations and Warranties	 	55
	 	 	3.12.2	 	No Defaults	 	55
	 	 	3.12.3	 	No Material Adverse Effect	 	55
	 	 	3.12.4	 	No Litigation	 	55
	 	 	3.12.5	 	Regulation	 	55
	 	 	3.12.6	 	No Change in Tax Laws	 	56
	 	 	3.12.7	 	Payment of Filing Fees	 	56
	 	 	3.12.8	 	Operative Documents and Permits	 	56
	 	 	3.12.9	 	Debt to Capitalization Ratio	 	56
	 	3.13	 	No Approval of Work	 	56
	 	3.14	 	Waiver of Funding; Adjustment of Drawdown Requests	 	56
	 	3.15	 	Committed Equity Contributions; Available Equity Commitment	 	56
	 	 	3.15.1	 	Cash Equity Contributions	 	56
	 	 	3.15.2	 	In-Kind Equity Contributions	 	57
	 	 	3.15.3	 	Total Equity Commitment	 	57
	 	 	3.15.4	 	Available Equity Commitment	 	58
	

ARTICLE 4.    REPRESENTATIONS AND WARRANTIES	
 	

58
	 	

4.1	
 	

Organization; Powers	
 	

58
	 	4.2	 	Authorization and No Legal Bar	 	58
	 	4.3	 	Enforceability	 	58
	 	4.4	 	Consents	 	58
	 	4.5	 	Compliance with Law	 	59
	 	4.6	 	Existing Defaults	 	59
	 	4.7	 	Litigation	 	59
	 	4.8	 	Labor Disputes and Acts of God	 	59

iv

 

	 	4.9	 	Taxes	 	59
	 	4.10	 	Regulation	 	59
	 	4.11	 	Private Offering by Borrower	 	60
	 	4.12	 	Investment Company Act	 	60
	 	4.13	 	Margin Stock	 	60
	 	4.14	 	ERISA and Employees	 	60
	 	4.15	 	Disclosure	 	60
	 	4.16	 	Budgets	 	60
	 	4.17	 	Financial Statements	 	61
	 	4.18	 	Ownership; Other Obligations	 	61
	 	4.19	 	Intellectual Property	 	61
	 	4.20	 	Offices; Location of Borrower Collateral	 	62
	 	4.21	 	Borrower Collateral	 	62
	

ARTICLE 5.    AFFIRMATIVE COVENANTS OF BORROWER	
 	

62
	 	

5.1	
 	

Use of Proceeds and Revenues	
 	

62
	 	 	5.1.1	 	Proceeds	 	62
	 	 	5.1.2	 	Revenues	 	63
	 	5.2	 	Notices	 	63
	 	5.3	 	Financial Statements	 	64
	 	5.4	 	Inspection of Books and Records	 	65
	 	5.5	 	Compliance with Laws	 	65
	 	5.6	 	Existence, Conduct of Business, Etc.	 	65
	 	5.7	 	Calculation of Ratios	 	65
	 	 	5.7.1	 	Debt Service Coverage Ratio	 	65
	 	 	5.7.2	 	Debt to Capitalization Ratio	 	65
	 	5.8	 	Indemnification	 	65
	 	5.9	 	Further Assurances	 	67
	 	5.10	 	Market Forecasts	 	68
	 	5.11	 	Revenue Payments to Borrower	 	68
	 	5.12	 	Taxes	 	68
	 	5.13	 	Interest Rate Protection	 	68
	 	 	5.13.1	 	Compliance with Interest Rate Agreements	 	68
	 	 	5.13.2	 	Hedge Breaking Fees	 	68
	 	 	5.13.3	 	Security	 	68
	 	 	5.13.4	 	Bank Participation	 	69
	 	5.14	 	Intercompany Loans	 	69
	

ARTICLE 6.    NEGATIVE COVENANTS OF BORROWER	
 	

69
	 	

6.1	
 	

Contingent Liabilities	
 	

69
	 	6.2	 	Limitations on Liens	 	69
	 	6.3	 	Indebtedness	 	69
	 	6.4	 	Sale of Assets	 	69
	 	6.5	 	Nature of Borrower's Business	 	71
	 	6.6	 	Distributions	 	71
	 	6.7	 	Investments	 	74
	 	6.8	 	Transactions With Affiliates	 	74
	 	6.9	 	Margin Stock Regulations	 	74
	 	6.10	 	ERISA	 	74
	 	6.11	 	Dissolution	 	74
	 	6.12	 	Accounts	 	75
	 	6.13	 	Name and Location; Fiscal Year	 	75

v

 

	 	6.14	 	Assignment	 	75
	 	6.15	 	Borrower Budget Amendments	 	75
	

ARTICLE 7.    EVENTS OF DEFAULT; REMEDIES	
 	

75
	 	

7.1	
 	

Events of Default	
 	

75
	 	 	7.1.1	 	Failure to Make Payments	 	75
	 	 	7.1.2	 	Judgments	 	75
	 	 	7.1.3	 	Misstatements; Omissions	 	75
	 	 	7.1.4	 	Bankruptcy; Insolvency	 	76
	 	 	7.1.5	 	Debt Cross Default	 	76
	 	 	7.1.6	 	ERISA	 	76
	 	 	7.1.7	 	Breach of Terms of Credit Documents	 	76
	 	 	7.1.8	 	Loss of Exemption	 	77
	 	 	7.1.9	 	Borrower Collateral	 	77
	 	 	7.1.10	 	Loss of Control	 	77
	 	 	7.1.11	 	Negative Pledge	 	77
	 	 	7.1.12	 	Project Events of Default	 	77
	 	 	7.1.13	 	Unenforceability of Credit Documents	 	77
	 	 	7.1.14	 	Equity Documents	 	78
	 	7.2	 	Remedies	 	78
	 	 	7.2.1	 	No Further Loans or Letters of Credit	 	78
	 	 	7.2.2	 	Cure by Majority Banks	 	78
	 	 	7.2.3	 	Acceleration	 	78
	 	 	7.2.4	 	Cash Equity Contributions	 	78
	 	 	7.2.5	 	Cash Collateralization of Letters of Credit	 	79
	 	 	7.2.6	 	Cash Collateral	 	79
	 	 	7.2.7	 	Possession of Approved Projects	 	79
	 	 	7.2.8	 	Remedies Under Credit Documents	 	79
	 	7.3	 	Building Loan Documents	 	79
	

ARTICLE 8.    SCOPE OF LIABILITY	
 	

79
	

ARTICLE 9.    ADMINISTRATIVE AGENT; AMENDMENTS AND WAIVERS	
 	

80
	 	

9.1	
 	

Appointment; Powers and Immunities	
 	

80
	 	9.2	 	Reliance by Administrative Agent	 	81
	 	9.3	 	Non-Reliance	 	81
	 	9.4	 	Defaults	 	81
	 	9.5	 	Indemnification	 	81
	 	9.6	 	Successor Administrative Agent	 	82
	 	9.7	 	Authorization	 	83
	 	9.8	 	Administrative Agent as a Bank	 	83
	 	9.9	 	Amendments; Waivers	 	83
	 	9.10	 	Withholding Tax	 	85
	 	9.11	 	General Provisions as to Payments	 	85
	 	9.12	 	Substitution of Bank or Lender Group	 	85
	 	9.13	 	Participation	 	86
	 	9.14	 	Transfer of Commitments	 	87
	 	 	9.14.1	 	Generally	 	87
	 	 	9.14.2	 	Transfers within Lender Groups	 	88
	 	9.15	 	Securities Laws	 	89
	 	9.16	 	Assignability to Federal Reserve Bank	 	90
	 	9.17	 	Additional Banks and Lender Groups	 	90

vi

 

	

ARTICLE 10.    INDEPENDENT CONSULTANTS	
 	

91
	 	

10.1	
 	

Removal and Fees	
 	

91
	 	 	10.1.1	 	Independent Engineer	 	91
	 	 	10.1.2	 	Insurance Consultant	 	91
	 	 	10.1.3	 	Fuel Consultant	 	92
	 	 	10.1.4	 	Power Market Consultant	 	92
	 	10.2	 	Duties	 	93
	 	10.3	 	Independent Consultants' Certificates	 	93
	 	10.4	 	Certification of Dates	 	93
	

ARTICLE 11.    MISCELLANEOUS	
 	

94
	 	

11.1	
 	

Addresses	
 	

94
	 	11.2	 	Additional Security; Right to Set-Off	 	94
	 	11.3	 	Delay and Waiver	 	95
	 	11.4	 	Costs, Expenses and Attorneys' Fees; Syndication	 	95
	 	11.5	 	Entire Agreement	 	96
	 	11.6	 	Governing Law	 	96
	 	11.7	 	Severability	 	96
	 	11.8	 	Headings	 	96
	 	11.9	 	Accounting Terms	 	96
	 	11.10	 	Additional Financing	 	96
	 	11.11	 	No Partnership, Etc.	 	96
	 	11.12	 	Collateral Documents	 	97
	 	11.13	 	Limitation on Liability	 	97
	 	11.14	 	Waiver of Jury Trial	 	97
	 	11.15	 	Consent to Jurisdiction	 	97
	 	11.16	 	Usury	 	97
	 	11.17	 	Successors and Assigns	 	98
	 	11.18	 	Counterparts	 	98
	 	11.19	 	Survival	 	98
	

ARTICLE 12.    LENDER GROUP AGENTS	
 	

98
	 	

12.1	
 	

Appointment, Powers and Immunities	
 	

98
	 	12.2	 	Reliance by Lender Group Agents	 	99
	 	12.3	 	Non-Reliance	 	99
	 	12.4	 	Defaults	 	100
	 	12.5	 	Indemnification	 	100
	 	12.6	 	Successor Lender Group Agent	 	100
	 	12.7	 	Authorization	 	101
	 	12.8	 	Lender Group Agent as a Bank or Related Bank	 	101
	 	12.9	 	Withholding Tax	 	101
	 	12.10	 	General Provisions as to Payments	 	101
	 	12.11	 	Action by Lender Group	 	101
	 	12.12	 	No Petition	 	102
	 	12.13	 	No Recourse	 	102

vii

 

Index of Exhibits  

	Exhibit A	Definitions and Rules of Interpretation
	

 	
Notes and Letters of Credit
	Exhibit B-1	Form of Construction Loan Note
	Exhibit B-2	Form of Working Capital/Project LC Note
	Exhibit B-3	Form of DSR LC Loan Note
	Exhibit B-4	Form of Project Letter of Credit
	Exhibit B-5	Form of DSR Letter of Credit
	

 	
Disbursement Procedures
	Exhibit C-1	Form of Construction Requisition
	Exhibit C-2	Form of Notice of Working Capital Loan Borrowing
	Exhibit C-3	Form of Confirmation of Interest Period Selection
	Exhibit C-4	Form of Notice of Conversion of Loan Type
	Exhibit C-5	Form of Notice of LC Activity
	Exhibit C-6A	Form of Debt Service Coverage Ratio Certificate
	Exhibit C-6B	Form of Debt to Capitalization Ratio Certificate
	

 	
Credit Documents
	Exhibit D-1	Form of Depositary Agreement
	Exhibit D-2A	Form of Project Company Guaranty
	Exhibit D-2B	Form of NEG Equity Guaranty
	Exhibit D-3	Form of Mortgage
	Exhibit D-4A	Form of Borrower Security Agreement
	Exhibit D-4B	Form of Project Company Security Agreement
	Exhibit D-5	Schedule of Security Filings
	Exhibit D-6	Form of Intercompany Note
	Exhibit D-7A	Form of Pledge Agreement (Borrower)
	Exhibit D-7B	Form of Pledge Agreement (Intermediate Holding Companies)
	Exhibit D-8A	Form of NEG EPC Guaranty (Covert)
	Exhibit D-8B	Form of NEG EPC Guaranty (Harquahala)
	Exhibit D-9	Form of NEG Equipment Contribution Agreement
	Exhibit D-10A	Form of SWPC Support Agreement (Athens)
	Exhibit D-10B	Form of SWPC Support Agreement (Harquahala)
	Exhibit D-11A	Form of NEG IDA Support Agreement
	Exhibit D-11B	Form of NEG Insurance Support Agreement

viii

 

	

 	
Consents
	Exhibit E	Form of Consent to Assignment
	

 	
Funding Certificates
	Exhibit F-1A	Form of Borrower's Closing Certificate
	Exhibit F-1B	Form of NEG's Closing Certificate
	Exhibit F-2	Intentionally Omitted
	Exhibit F-3	Form of In Kind Equity Contributions Certificate
	Exhibit F-4	Form of Insurance Consultant's Certificate
	Exhibit F-5A	Form of Independent Engineer's Closing Certificate
	Exhibit F-5B	Form of Independent Engineer's Funding Certificate
	Exhibit F-6A	Form of Fuel Consultant's Closing Certificate
	Exhibit F-6B	Form of Fuel Consultant's Funding Certificate
	Exhibit F-7A	Form of Power Market Consultant's Closing Certificate
	Exhibit F-7B	Form of Power Market Consultant's Funding Certificate
	

 	
Project Description Exhibits
	Exhibit G-1	Description of Initial and Substitute Projects
	Exhibit G-2	Preliminary Project Budgets and Project Schedules; Borrower Budget; Closing Date Base Case Project Projections
	Exhibit G-3	Major Project Party Financial Statements
	Exhibit G-4	Conditions Specific to the Subject Project
	Exhibit G-5A	Non-Compliance
	Exhibit G-5B	Pending Litigation
	Exhibit G-5C	Contested Taxes
	

 	
Other
	Exhibit H	Amortization Schedule
	Exhibit I	Banks, Commitments, Lending Offices
	Exhibit J	Form of Exemption Certificate
	Exhibit K	Intentionally Omitted
	Exhibit L	Form of Assignment Agreement
	Exhibit M	Replacement Independent Engineer Firms
	Exhibit N	Replacement Insurance Consultant Firms
	Exhibit O	Replacement Fuel Consultant Firms
	Exhibit P	Replacement Power Market Consultant Firms
	Exhibit Q	Chief Executive Offices, etc.
	Exhibit R	Intentionally Omitted
	Exhibit S	Applicable Margin and Applicable Fee Rate
	Exhibit T	Subordination Terms
	Exhibit U	Information Memorandum
	Exhibit V	Joinder Agreement
	Exhibit W-1	Third Party Consents
	Exhibit W-2	Third Party Opinions

ix

        This AMENDED AND RESTATED CREDIT AGREEMENT (as amended, amended and restated, supplemented or otherwise modified from time to time, this
"Agreement"), dated as of March 15, 2002, is entered into among (1) GENHOLDINGS I, LLC, a limited liability company formed under the laws
of the State of Delaware, as Borrower, (2) SOCIETE GENERALE, as Administrative Agent and a Lead Arranger ("SG"), (3) CITIBANK, N.A., as
Syndication Agent and a Lead Arranger ("Citibank" and, together with SG, the "Lead Arrangers"),
(4) THE OTHER AGENTS AND ARRANGERS LISTED ON THE SIGNATURE PAGES HERETO (including the Alternative Funding Arranger) (together with the Lead Arrangers, the
"Arrangers"), (5) JPMORGAN CHASE BANK, as issuer of the Letters of Credit hereunder (the "LC
Bank"), (6) THE FINANCIAL INSTITUTIONS PARTY HERETO FROM TIME TO TIME AS BANKS (individually, a "Bank" and, collectively,
the "Banks"), (7) EACH PERSON PARTY HERETO FROM TIME TO TIME AS A CP CONDUIT (a "CP Conduit"),
(8) THE FINANCIAL INSTITUTIONS PARTY HERETO FROM TIME TO TIME AS RELATED BANKS (individually, a "Related Bank" and, collectively, the
"Related Banks"), and (9) EACH FINANCIAL INSTITUTION PARTY HERETO FROM TIME TO TIME AS AGENT FOR A CP CONDUIT AND ITS RESPECTIVE RELATED BANK (a
"Lender Group Agent"). Each Lender Group Agent and its corresponding CP Conduit and Related Bank are referred to herein collectively as a
"Lender Group". 

        The
parties hereto entered into the Credit Agreement, dated as of December 21, 2001 (the "Original Credit Agreement"), and have
determined that the Original Credit Agreement shall be amended and restated in its entirety as set forth herein. 

        In
consideration of the agreements herein and in the other Credit Documents and in reliance upon the representations and warranties set forth herein and therein, the parties agree that
the Original Credit Agreement shall be amended and restated in its entirety as follows: 

ARTICLE 1.
  DEFINITIONS; RULES OF INTERPRETATION  

        1.1    Definitions.    Except as otherwise expressly provided, capitalized terms used in this Agreement shall have the
meanings given in Exhibit A hereto. 

        1.2    Rules of Interpretation.    Except as otherwise expressly provided, the rules of interpretation set forth in  Exhibit A
hereto shall apply to this Agreement and the other Credit Documents. 

ARTICLE 2.
  THE CREDIT FACILITIES  

        2.1    Loan Facilities.    

        2.1.1    Construction Loan Facility.    

        (a)    Availability.    Subject to the terms and conditions set forth in this Agreement and in reliance upon the
representations and warranties of Borrower herein set forth, (i) each Bank severally agrees to advance to Borrower from time to time during the Construction Loan Availability Period such loans
as Borrower may request pursuant to this Section 2.1.1 in an aggregate principal amount which does not exceed such Bank's Proportionate Share of
the then current Available Construction Loan Commitment (individually, a "Bank Construction Loan" and, collectively, the "Bank
Construction Loans") and (ii) each Lender Group severally agrees, in accordance with the terms of this Agreement, to advance to Borrower from time to time during the
Construction Loan Availability Period such loans as Borrower may request pursuant to this Section 2.1.1 in an aggregate principal amount which
does not exceed such Lender Group's Proportionate Share of the then current Available Construction Loan Commitment (individually, a "Lender Group Construction
Loan" and, collectively, the "Lender Group Construction Loans", and, together with Bank Construction Loans, collectively,
"Construction Loans", and individually, a "Construction Loan"). A Lender Group Construction Loan may
consist of a CP Conduit Construction Loan (as defined below) or a Related Bank Construction Loan (as defined below) in accordance with the following two sentences. Each 

 

Lender Group Construction Loan to be made by a Lender Group shall first be offered to the applicable CP Conduit to fund (each such Lender Group Construction Loan funded by the applicable CP Conduit,
together with any Related Bank Construction Loan assigned by the applicable Related Bank to such CP Conduit pursuant to Section 9.14.2, being,
individually, a "CP Conduit Construction Loan" and, collectively, such CP Conduit's "CP Conduit Construction
Loans"), provided that no CP Conduit shall have any obligation whatsoever to make any loans under this Agreement. In the event
such CP Conduit cannot or chooses not to fund such Lender Group Construction Loan, the Related Bank that is a member of the applicable Lender Group shall fund such Lender Group Construction Loan under
its Parallel Funding Commitment (each such Lender Group Construction Loan funded by a Related Bank, together with any CP Conduit Construction Loan assigned by the applicable CP Conduit to such Related
Bank pursuant to Section 9.14.2, being, individually, a "Related Bank Construction Loan" and,
collectively, "Related Bank Construction Loans"), provided that in no event shall the aggregate
outstanding principal amount of Related Bank Construction Loans funded by a
Related Bank under its Parallel Funding Commitment exceed the then current Available Parallel Funding Commitment of such Related Bank. 

        (b)    Construction Requisition.    Borrower shall request a Borrowing of Construction Loans by delivering to
Administrative Agent a written notice in the form of Exhibit C-1 hereto, appropriately completed (a
"Construction Requisition"), which specifies, among other things: 

          (i)  The
portion of the requested Borrowing which will bear interest as provided in (1) Section 2.1.1(c)(i)
(individually, a "Base Rate Construction Loan" and, collectively, "Base Rate Construction Loans") and/or
(2) Section 2.1.1(c)(ii) (individually, a "LIBOR Construction Loan" and, collectively,
"LIBOR Construction Loans"); 

        (ii)  The
aggregate amount of the requested Borrowing, which (A) shall be in a minimum amount of $1,000,000 and an integral multiple of $100,000 in excess of thereof,
and (B) shall not exceed the then current Available Construction Loan Commitment; 

        (iii)  The
proposed date of the requested Borrowing (which shall be (x) a Banking Day and (y) if as of the proposed date of the requested Borrowing any Lender
Group will be party to this Agreement, a day other than the 15thcalendar day of any calendar month (or if such day is not a Banking Day, the first Banking Day after such
15th calendar day) or the final two Banking Days of any calendar month, unless otherwise consented to in writing by each Lender Group Agent); 

        (iv)  If
the requested Borrowing is to consist of LIBOR Construction Loans, the initial Interest Period requested therefor (which shall be a period contemplated by  Section 2.1.3(b)); 

        (v)  The
Applicable Margin which will be in effect as of the proposed date of the requested Borrowing; 

        (vi)  The
Subject Project to which the requested Borrowing relates or, if the requested Borrowing relates to more than one Subject Project, the Subject Projects to which the
requested Borrowing relates and the portion of such Borrowing related to each such Subject Project; 

      (vii)  The
portion of the requested Borrowing, if any, that is going to be used to make In Kind Equity Payments in accordance with clause (i) of the proviso to  Section 5.1.1(a), and the account to which
the Construction Loans to be used for such purpose should be transferred; and 

2

 

      (viii)  The
portion of the requested Borrowing, if any, that is going to be used to make Equity Contribution True-Up Reimbursements or NEG EPC Guaranty
Reimbursements, as the case may be, in accordance with clause (ii) of the proviso to Section 5.1.1(a), and the account to which the
Construction Loans to be used for such purpose should be transferred. 

        Borrower
shall request (A) no more than three Borrowings of Construction Loans in the aggregate per month and (B) no more than two Borrowings of Construction Loans with
respect to any Project per month. Borrower shall give each Construction Requisition to Administrative Agent so as to provide the Minimum Notice Period applicable to Borrowings of Construction Loans.
Any Construction Requisition shall be irrevocable and Borrower shall be bound to borrow Construction Loans in accordance therewith. Each Construction Requisition shall be delivered by first-class mail
or facsimile to Administrative Agent at the office or to the facsimile number and during the hours specified in Section 11.1;  provided, however, that Borrower shall promptly deliver to Administrative Agent the original of any
Construction Requisition initially delivered by facsimile. 

        Borrower
shall notify Administrative Agent in writing prior to the making of any Construction Loan in the event that any of the matters to which Borrower is required to certify in the
applicable Construction Requisition is no longer accurate and complete as of the date of the applicable Borrowing of Construction Loans. The acceptance by Borrower of the proceeds of any Construction
Loan without providing any such written notice shall constitute a re-certification by Borrower, as of the date of the applicable Borrowing of Construction Loans, as to the matters to which
Borrower is required to certify in the applicable Construction Requisition or any certificate delivered in connection therewith. 

        (c)    Construction Loan Interest.    Subject to the provisions of Sections
2.5.3, 2.5.4 and 2.7.3, each Construction Loan shall bear interest on the unpaid
principal amount thereof from the date of such Construction Loan until the maturity or prepayment thereof at a rate determined by reference to the Base Rate or the LIBO Rate. The applicable basis for
determining the rate of interest with respect to any Construction Loan shall be selected by Borrower initially at the time a Construction Requisition is given with respect to such Construction Loan
pursuant to Section 2.1.1(b), and the basis for determining the interest rate with respect to any Construction Loan (other than a CP Conduit
Funded LIBOR Construction Loan) may be changed from time to time pursuant to Section 2.1.7. If on any day a Construction Loan (other than a CP
Conduit Funded LIBOR Construction Loan) is outstanding with respect to which notice has not been delivered to Administrative Agent in accordance with the terms of this Agreement specifying the
applicable basis for determining the rate of interest, then for that day such Construction Loan shall bear interest determined by reference to the Base Rate. Subject to  Section 2.7, each CP Conduit
Construction Loan requested to be made as a LIBOR Loan shall be made as a CP Conduit Funded LIBOR Construction Loan.
 

        Subject
to the provisions of Sections 2.5.3, 2.5.4 and  2.7.3, Borrower shall pay interest on the unpaid principal
amount of each Construction Loan from the date of such Construction Loan until the maturity
or prepayment thereof at the following rates per annum: 

          (i)  With
respect to the principal portion of such Construction Loan which is, and during the periods when such portion of such Construction Loan is, a Base Rate
Construction Loan, at a rate per annum equal to the Base Rate plus the Applicable Margin, such rate to change from time to time as the Base Rate shall change; and 

        (ii)  With
respect to the principal portion of such Construction Loan which is, and during the periods when such portion of such Construction Loan is, a LIBOR 

3

 

Construction Loan, at a rate per annum during each Interest Period for such LIBOR Construction Loan equal to the applicable LIBO Rate for such Interest Period, plus the Applicable Margin;  provided that
the LIBO Rate for the initial Interest Period applicable to a CP Conduit Funded LIBOR Construction Loan shall be determined by reference
to a one month LIBO Rate regardless of the actual number of days in such initial Interest Period. 

        (d)    Construction Loan Principal Payments.    Borrower shall repay to Administrative Agent, for the account of each
Bank and each Lender Group, the aggregate unpaid principal amount of all Construction Loans made by each such Bank or each such Lender Group, as the case may be, in installments payable on the
Amortization Commencement Date and each Quarterly Date thereafter in accordance with Exhibit H hereto, with any remaining unpaid principal,
interest, fees and costs due and payable on the Final Maturity Date. Once repaid, Construction Loans may not be reborrowed; provided that
(i) Construction Loans that are repaid pursuant to Section 6.4(a)(iii) may be reborrowed, in accordance with the terms hereof, in
connection with a Substitute Project that becomes an Approved Project pursuant to Section 3.11, and (ii) the Construction Loan Commitments
may be reutilized as contemplated by Section 9.17 in accordance with the terms hereof. 

        2.1.2    Working Capital Loan Facility.    

        (a)    Availability.    Subject to the terms and conditions set forth in this Agreement and in reliance upon the
representations and warranties of Borrower herein set forth, each Bank severally agrees to advance to Borrower from time to time during the Working Capital/LC Availability Period such loans as
Borrower may request pursuant to this Section 2.1.2 (individually, a "Working Capital Loan" and,
collectively, the "Working Capital Loans") in an aggregate principal amount which does not exceed such Bank's Proportionate Share of the then current
Available Working Capital/Project LC Commitment. Subject to the terms hereof (including the conditions precedent set forth in Article 3),
Borrower may borrow, repay and reborrow the Working Capital Loans from time to time during the Working Capital/LC Availability Period. 

        (b)    Notice of Working Capital Loan Borrowing.    Borrower shall request a Borrowing of Working Capital Loans by
delivering to Administrative Agent a written notice in the form of Exhibit C-2 hereto, appropriately completed (a
"Notice of Working Capital Loan Borrowing"), which specifies, among other things: 

          (i)  The
portion of the requested Borrowing which will bear interest as provided in (1) Section 2.1.2(c)(i)
(individually, a "Base Rate Working Capital Loan" and, collectively, "Base Rate Working Capital Loans")
and/or (2) Section 2.1.2(c)(ii) (individually, a "LIBOR Working Capital Loan" and,
collectively, "LIBOR Working Capital Loans"); 

        (ii)  The
aggregate amount of the requested Borrowing, which (A) shall be in a minimum amount of $500,000 and an integral multiple of $100,000 in excess thereof, and
(B) shall not exceed the then current Available Working Capital/Project LC Commitment; 

        (iii)  The
proposed date of the requested Borrowing (which shall be a Banking Day); 

        (iv)  If
the requested Borrowing is to consist of LIBOR Working Capital Loans, the initial Interest Period requested therefor (which shall be a period contemplated by  Section 2.1.3(b)); 

        (v)  The
Applicable Margin which will be in effect as of the proposed date of the requested Borrowing; 

4

 

        (vi)  The
Subject Project to which the requested Borrowing relates or, if the requested Borrowing relates to more than one Subject Project, the Subject Projects to which the
requested Borrowing relates and the portion of such Borrowing related to each such Subject Project; and 

      (vii)  The
portion of the requested Borrowing, if any, that is going to be used to pay interest on outstanding Loans or scheduled payment obligations under Interest Rate
Agreements. 

        Borrower
shall request (A) no more than three Borrowings of Working Capital Loans in the aggregate per month and (B) no more than one Borrowing of Working Capital Loans
with respect to any Project per month. Borrower shall give each Notice of Working Capital Loan Borrowing to Administrative Agent so as to provide the Minimum Notice Period applicable to Working
Capital Loans of the Type requested. Any Notice of Working Capital Loan Borrowing shall be irrevocable and Borrower shall be bound to borrow Working Capital Loans in accordance therewith. Each Notice
of Working Capital Loan Borrowing shall be delivered by first-class mail or facsimile to Administrative Agent at the office or to the facsimile number and during the hours specified in  Section 11.1; provided, however, that Borrower
shall promptly deliver to Administrative Agent the original of any Notice of Working Capital Loan Borrowing initially delivered by facsimile. 

        Borrower
shall notify Administrative Agent in writing prior to the making of any Working Capital Loan in the event that any of the matters to which Borrower is required to certify in the
applicable Notice of Working Capital Loan Borrowing is no longer accurate and complete as of the date of the applicable Borrowing of Working Capital Loans. The acceptance by Borrower of the proceeds
of any Working Capital Loan without providing any such written notice shall constitute a re-certification by Borrower, as of the date of the applicable Borrowing of Working Capital Loans,
as to the matters to which Borrower is required to certify in the applicable Notice of Working Capital Loan Borrowing or any certificate delivered in connection therewith. 

        (c)    Working Capital Loan Interest.    Subject to the provisions of Sections
2.5.3, 2.5.4 and 2.7.3, each Working Capital Loan shall bear interest on the
unpaid principal amount thereof from the date of such Working Capital Loan until the maturity or prepayment thereof at a rate determined by reference to the Base Rate or the LIBO Rate. The applicable
basis for determining the rate of interest with respect to any Working Capital Loan shall be selected by Borrower initially at the time a Notice of Working Capital Loan Borrowing is given with respect
to such Working Capital Loan pursuant to Section 2.1.2(b), and the basis for determining the interest rate with respect to any Working Capital
Loan may be changed from time to time pursuant to Section 2.1.7. If on any day a Working Capital Loan is outstanding with respect to which notice
has not been delivered to Administrative Agent in accordance with the terms of this Agreement specifying the applicable basis for determining the rate of interest, then for that day such Working
Capital Loan shall bear interest determined by reference to the Base Rate. 

        Subject
to the provisions of Sections 2.5.3, 2.5.4 and  2.7.3, Borrower shall pay interest on the unpaid principal
amount of each Working Capital Loan from the date of such Working Capital Loan until the
maturity or prepayment thereof at the following rates per annum: 

          (i)  With
respect to the principal portion of such Working Capital Loan which is, and during the periods when such portion of such Working Capital Loan is, a Base Rate
Working Capital Loan, at a rate per annum equal to the Base Rate plus the Applicable Margin, such rate to change from time to time as the Base Rate shall change; and 

5

 

        (ii)  With
respect to the principal portion of such Working Capital Loan which is, and during the periods when such portion of such Working Capital Loan is, a LIBOR Working
Capital Loan, at a rate per annum during each Interest Period for such LIBOR Working Capital Loan equal to the LIBO Rate for such Interest Period, plus the Applicable Margin. 

        (d)    Working Capital Loan Principal Payments.    All outstanding Working Capital Loans shall be repaid on each
Quarterly Date following the Last Completion Date to the extent of Account Funds available for such purpose in the Debt Payment Account on such Quarterly Date, after giving effect to transfers
from the Applicable Revenue Account to the Debt Payment Account on such Quarterly Date; provided,  however, that each Working Capital Loan shall be repaid
in full on the Final Maturity Date. 

        2.1.3    Interest Provisions Relating to All Loans (including Project LC Loans and DSR LC Loans).    

        (a)    Interest Payment Dates.    Borrower shall pay accrued interest on the unpaid principal amount of each Loan
(i) in the case of each Base Rate Loan (other than Base Rate Loans of a CP Conduit), on each Quarterly Date, (ii) in the case of a Base Rate Loan of a CP Conduit, on the fifth Banking
Day of each calendar month, (iii) in the case of each LIBOR Loan, on the last day of each Interest Period related to such LIBOR Loan and, if such Interest Period is longer than three months,
every three months after the date of such LIBOR Loan, and (iv) in all cases, upon prepayment (to the extent thereof and including all Optional Prepayments and Mandatory Prepayments), upon
conversion from one Type of Loan to another Type, and at maturity. 

        (b)    LIBOR Loan Interest Periods.    

          (i)  In
connection with each LIBOR Loan (other than a CP Conduit Funded LIBOR Construction Loan), Borrower may, pursuant to the applicable Notice of Borrowing or Notice of
Conversion of Loan Type, as the case may be, select an Interest Period to be applicable to such LIBOR Loan, which Interest Period shall be one, two, three, six or, if available to all Banks and
Related Banks and made available by Administrative Agent, nine or 12 months. Notwithstanding anything to the contrary in this Agreement, (A) any Interest Period which would otherwise end
on a day which is not a Banking Day shall be extended to the next succeeding Banking Day unless such next Banking Day falls in another calendar month, in which case such Interest Period shall end on
the immediately preceding Banking Day; (B) any Interest Period which begins on the last Banking 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 Interest Period) shall end on the last Banking Day of a calendar month; (C) Borrower may not select Interest Periods which would leave a greater principal
amount of Loans subject to Interest Periods ending after a date upon which Loans are or may be required to be repaid than the principal amount of Loans scheduled to be outstanding after such date;
(D) no Interest Period with respect to any portion of the Loans shall extend beyond the Final Maturity Date; (E) LIBOR Loans for each Interest Period shall be in the amount of at least
$1,000,000; (F) Borrower may not at any time have outstanding more than ten different Interest Periods relating to LIBOR Loans; (G) if Borrower fails to specify an Interest Period for
any LIBOR Loan in accordance with the terms of this Agreement, (1) in the case of a new requested Loan (other than a CP Conduit Construction Loan), Borrower shall be deemed to have specified
such Loans as Base Rate Loans in the applicable Notice of Borrowing, (2) in the case of a new requested CP Conduit Construction Loan, such Loans shall be funded as CP Conduit Funded LIBOR
Construction Loans, and (3) in the 

6

 

case of outstanding Loans (other than a CP Conduit Funded LIBOR Construction Loan), such Loans shall automatically convert to Base Rate Loans on the last day of the current Interest Period therefor;
(H) for the period from and after the Closing Date to and including the date which is six months after the Closing Date, Borrower may only select a one month Interest Period with respect to any
LIBOR Loan other than a CP Conduit Funded LIBOR Construction Loan; and (I) all CP Conduit Funded
LIBOR Construction Loans shall have an initial Interest Period of one month or less, commencing on the date such CP Conduit Funded Construction Loan is made and ending in each case on the next
occurring day that is a fifth Banking Day of a calendar month, and thereafter shall have an Interest Period as determined in accordance with the provisions of  Section 2.1.7(b)(i). 

        (ii)  Borrower
may contact Administrative Agent at any time prior to the end of an Interest Period for a quotation of interest rates in effect at such time for given Interest
Periods and Administrative Agent shall promptly provide such quotation. Borrower may select an Interest Period telephonically within the time periods specified in  Section 2.1.7, which selection
shall be irrevocable on and after the applicable Minimum Notice Period. Borrower shall confirm such telephonic
notice to Administrative Agent by delivering to Administrative Agent by facsimile on the day such notice is given a written notice in substantially the form of  Exhibit C-3 hereto (a "Confirmation of Interest Period Selection"). Borrower shall
promptly deliver to Administrative Agent the original of the Confirmation of Interest Period Selection initially delivered by facsimile. Administrative Agent shall as soon as practicable (and, in any
case, within two Banking Days after delivery of the Confirmation of Interest Period Selection) notify Borrower of each determination of the interest rate applicable to each Loan. 

        (c)    Interest Computations.    All computations of interest on Base Rate Loans (other than Base Rate Loans of a CP
Conduit if the Base Rate is determined other than by reference to clause (ii)(a) of the definition of "Base Rate" in Exhibit A hereto)
shall be based upon a year of 365 days (or 366 days in a leap year), and shall be payable for the actual days elapsed (including the first day but excluding the last day). All
computations of interest on Base Rate Loans of a CP Conduit when the Base Rate is determined other than by reference to clause (ii)(a) of the definition of "Base Rate" in  Exhibit A hereto
shall be based upon 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). All computations of interest on LIBOR Loans shall be based upon a year of 360 days, and shall be payable for the actual days elapsed (including the first day
but excluding the last day). Borrower agrees that all computations by Administrative Agent of interest shall be conclusive and binding in the absence of manifest error. 

        2.1.4    Register.    

        (a)  Administrative
Agent shall maintain, at its address referred to in Section 11.1, a register for the recordation of
the names and addresses of the Banks and the Lender Groups (and the members thereof), the Commitments and Loans of each Bank and Lender Group from time to time and the Parallel Funding Commitment of
each Related Bank from time to time (the "Register"). The Register shall be available for inspection by Borrower at any reasonable time and from time to
time upon reasonable prior notice. 

        (b)  Administrative
Agent shall record in the Register (i) the Commitments and the Loans from time to time of each Bank and each Lender Group, including any transfers
thereof made in accordance with Section 9.14, (ii) the interest rates applicable to all Loans and the effective dates of all changes
thereto, (iii) the Interest Period for each LIBOR Loan, (iv) the date and amount of any principal or interest due and payable or to become due and payable from Borrower to each Bank and
each Lender Group
hereunder, (v) each repayment or prepayment in respect of the principal amount of the Loans of each Bank and each Lender 

7

 

Group, (vi) the amount of any sum received by Administrative Agent hereunder for the account of the Banks and the Lender Groups and each Bank's and each Lender Group's share thereof and
(vii) such other information as Administrative Agent may determine is necessary for administering the Loans and this Agreement. Any such recordation shall be conclusive and binding on Borrower,
each Bank and each Lender Group, absent manifest error; provided that neither failure to make any such recordation, nor any error in such recordation,
shall affect any Bank's Commitments, any Lender Group's Construction Loan Commitment, any Related Bank's Parallel Funding Commitment or Borrower's obligations in respect of any applicable Loans or
otherwise; and provided, further that in the event of any inconsistency between the Register and any
Bank's or any Lender Group's records, the recordations in the Register shall govern in the absence of manifest error. 

        (c)  Each
Lender Group Agent shall maintain, at its address referred to in Exhibit I, a register for the recordation of
the names and addresses of the Related Bank and the CP Conduit that are members of the applicable Lender Group, the Construction Loan Commitment of such Lender Group, the Parallel Funding Commitment
of the such Related Bank, the Related Bank Construction Loans of such Related Bank and the CP Conduit Construction Loans of such CP Conduit (such Lender Group's "Lender Group
Register"). Each Lender Group Register shall be available for inspection by Borrower at any reasonable time and from time to time upon reasonable prior notice. 

        (d)  Each
Lender Group Agent shall record in the applicable Lender Group Register (i) the Commitment of the applicable Lender Group, the Parallel Funding Commitment of
the Related Bank that is a member of such Lender Group, the Related Bank Construction Loans of such Related Bank, the CP Conduit Construction Loans of the CP Conduit that is a member of such Lender
Group and the Construction Loans of such Lender Group, each from time to time, including any transfers thereof made in accordance with  Section 9.14, (ii) the interest rates applicable to each
of such Related Bank Construction Loans and CP Conduit Construction Loans and the
effective date of all changes thereto, (iii) the Interest Period for each of such Related Bank Construction Loans and CP Conduit Construction Loans, (iv) the date and amount of any
principal or interest due and payable or to become due and payable from Borrower to such Related Bank and to such CP Conduit hereunder, (v) each repayment and prepayment in respect of the
principal amount of the Related Bank Construction Loans of such Related Bank, the CP Conduit Construction Loans of such CP Conduit and the Construction Loans of such Lender Group, (vi) the
amount of any sum received by such Lender Group Agent hereunder for the account of such Lender Group and such Related Bank's and such CP Conduit's share thereof and (vii) such other information
as such Lender Group Agent may determine is necessary for administering the Commitments and the Constructions Loans of such Lender Group. Any such recordation shall, subject to  Section 2.1.4(b), be
conclusive and binding on Borrower, the applicable Related Bank and the applicable CP Conduit, absent manifest error;  provided that neither the failure to make any such recordation, nor any error in
such recordation, shall affect the Construction Loan Commitment of the
applicable Lender Group or the Parallel Funding Commitment of the applicable Related Bank or Borrower's obligations in respect of any applicable Construction Loans or otherwise; and  provided,
further that in the event of any inconsistency between such Lender Group Register and the
records of the applicable Related Bank or the applicable CP Conduit, the recordations in such Lender Group Register shall govern in the absence of manifest error. 

        (e)  In
the event of any inconsistency between the Register and any Lender Group Register, the recordations in the Register shall govern in the absence of manifest error. 

8

 

        2.1.5    Promissory Notes.    If requested by any Bank, or any Lender Group Agent on behalf of its respective Lender
Group, (a) the obligation of Borrower to repay the Construction Loans made by such Bank or such Lender Group and to pay interest thereon at the rates provided herein shall be evidenced by a
promissory note in the form of Exhibit B-1 hereto (a "Construction Loan Note"),
payable to the order of such requesting Bank or such requesting Lender Group Agent and in the principal amount of such Bank's and/or such Lender Group's Construction Loan Commitment, (b) the
obligation of Borrower to repay the Working Capital Loans and Project LC Loans made by such requesting Bank and to pay interest thereon at the rates provided herein shall be evidenced by a promissory
note in the form of Exhibit B-2 hereto (a "Working Capital/Project LC Loan Note"),
payable to the order of such requesting Bank and in the principal amount of such Bank's Working Capital/Project LC Commitment, and (c) the obligation of Borrower to repay the DSR LC Loans made
by such requesting Bank and to pay interest thereon at the rates provided herein shall be evidenced by a promissory note in the form of  Exhibit B-3 hereto (a "DSR LC Loan
Note"), payable to the order of such requesting
Bank and in the principal amount of such Bank's DSR LC Commitment. Borrower authorizes each such requesting Bank and each such requesting Lender Group Agent to record on the schedules annexed to its
respective Note or Notes the date and amount of each Loan made by such Bank or by the Lender Group of such Lender Group Agent, and each repayment or prepayment of principal thereunder, and agrees that
all such notations shall constitute prima facie evidence of the matters noted; provided that in the
event of any inconsistency between the Register and any Bank's or Lender Group Agent's records, the recordations in the Register shall govern; and  provided, further that neither the failure to issue any Note or to make any such notation, nor any error
in such notation, shall affect the validity of Borrower's obligations to repay the full unpaid principal amount of the Loans or the other obligations of Borrower hereunder or under the Notes. Borrower
further authorizes each Bank and each Lender Group Agent which receives a Note to attach to and make a part of such Note continuations of the schedule attached thereto as necessary. 

        2.1.6    Loan Funding.    

        (a)    Notice.    Each Notice of Borrowing shall be delivered by Borrower to Administrative Agent in accordance with  Section 11.1. Administrative Agent shall promptly notify each Bank and, if such Notice of Borrowing relates to Construction Loans, each Lender
Group Agent, of the contents of each Notice of Borrowing. 

        (b)    Pro Rata Loans.    All Construction Loans shall be made on a pro
rata basis by the Banks and the Lender Groups in accordance with their respective Proportionate Shares of such Construction Loans, with each Borrowing to consist of a
Construction Loan by each Bank and each Lender Group equal to such Bank's and such Lender Group's Proportionate Share of such Borrowing. All Loans other than Construction Loans shall be made on a  pro rata basis by the Banks in accordance with their respective
Proportionate Shares of such Loans, with each Borrowing to consist of a Loan by each Bank equal to such Bank's Proportionate Share of such Borrowing. 

        (c)    Funding.    Each Bank and each Lender Group, as applicable, shall, before 11:00 a.m. on the date of each
Borrowing, make available to Administrative Agent by wire transfer of immediately available funds in Dollars to the account of Administrative Agent most recently designated by it for such purpose,
such Bank's or such Lender Group's Proportionate Share of such Borrowing. The failure of any Bank or any Lender Group to make the Loan to be made by it as part of any Borrowing shall not relieve any
other Bank or Lender Group of its obligation hereunder to make its Loan on the date of such Borrowing. No Bank or Lender Group shall be responsible for the failure of any other Bank or Lender Group to
make the Loan to be made by such other Bank or Lender Group on the date of any Borrowing. 

9

 

        Unless
Administrative Agent shall have been notified by any Bank or Lender Group Agent prior to the date of any Borrowing that such Bank does not intend to make available to
Administrative Agent the amount of such Bank's Proportionate Share of the Borrowing requested on such date, or that such Lender Group does not intend to make available to Administrative Agent the
amount of such Lender Group's Proportionate Share of Construction Loans requested as part of the Borrowing requested on such date, Administrative Agent may assume that such Bank or Lender Group has
made such amount available to Administrative Agent on such date in accordance with the prior paragraph and Administrative Agent may, in its sole discretion and in reliance upon such assumption, make
available to Borrower a corresponding amount on such date. If such corresponding amount is not in fact made available to Administrative Agent by such Bank or Lender Group, Administrative Agent shall
be entitled to recover such corresponding amount on demand (and, in any event, within two Banking Days after the date of the applicable Borrowing) from such Bank or such Lender Group's Related Bank,
together with interest thereon, for each day from the date of such Borrowing until the date such amount is paid to Administrative Agent, at the Federal Funds Rate for the first two Banking Days after
such date. If such Bank or such Related Bank pays such amount to Administrative Agent, then such amount shall constitute such Bank's or such Lender Group's Proportionate Share of such Borrowing. If
such Bank or such Related Bank does not pay such corresponding amount forthwith upon Administrative Agent's demand therefor or within two Banking Days from the date of the applicable Borrowing,
Administrative Agent shall promptly notify Borrower and Borrower shall immediately pay such corresponding amount to Administrative Agent together with interest thereon, for each day from the date of
the applicable Borrowing until the date such amount is paid to Administrative Agent, at the rate then payable under this Agreement for Base Rate Loans. Nothing in this  Section 2.1.6(c) shall be
deemed to relieve any Bank or any Related Bank from its obligations hereunder or to prejudice any rights that Borrower
may have against any Bank or any Related Bank as a result of any default by such Bank or such Related Bank hereunder. 

        Upon
receipt by a Lender Group Agent from Administrative Agent of notification of the contents of a Notice of Borrowing, such Lender Group Agent shall notify the CP Conduit that is a
member of its Lender Group of the amount of any Construction Loan to be funded by such Lender Group (excluding any Construction Loan to be funded by conversion of a Cash Secured Advance pursuant to  Section 2.3.7). If such CP Conduit cannot or chooses not to fund such Construction Loan (excluding any
Construction Loan to be funded by conversion of a Cash Secured Advance pursuant to Section 2.3.7) in accordance with this Agreement, such Lender
Group Agent shall promptly so advise the Related Bank that is a member of its Lender Group and request such Related Bank to fund such Construction Loan (excluding any portion thereof to be funded by
conversion of a Cash Secured Advance pursuant to Section 2.3.7) under its Parallel Funding Commitment. Administrative Agent shall treat each
Construction Loan funded by a Lender Group as a CP Conduit Construction Loan unless and until otherwise notified by the applicable Lender Group Agent. 

        (d)    Disbursement of Construction Loans.    No later than 3:00 p.m. on the date specified in each
Construction Requisition, if the applicable conditions precedent listed in Article 3 have been satisfied or waived in accordance with the terms
hereof and, subject to Section 2.1.6(c) above, to the extent Administrative Agent shall have received the appropriate funds from the applicable
Banks and the applicable Lender Groups, Administrative Agent will make available the Construction Loans requested in such Construction Requisition (or so much thereof as the Banks and the Lender
Groups shall have approved pursuant to this Agreement) in Dollars and in immediately available funds, at Administrative Agent's New York Branch, and shall (i) deposit such Construction Loans
into the Construction Account or (ii) if such Construction 

10

 

Loans are to be used to make In Kind Equity Payments, Equity Contribution True-Up Reimbursements or NEG EPC Guaranty Reimbursements in accordance with the proviso to  Section 5.1.1(a), transfer such
Construction Loans to the account designated by Borrower in such Construction Requisition. 

        (e)    Disbursement of Working Capital Loans.    No later than 3:00 p.m. on the date specified in each Notice
of Working Capital Borrowing, if the applicable conditions precedent listed in Article 3 have been satisfied or waived in accordance with the
terms hereof and, subject to Section 2.1.6(c) above, to the extent Administrative Agent shall have received the appropriate funds from the Banks,
Administrative Agent will make available the Working Capital Loans requested in such Notice of Working Capital Borrowing (or so much thereof as the Banks shall have approved pursuant to this
Agreement) in Dollars and in immediately available funds, at Administrative Agent's New York Branch, and shall (i) if such Working Capital Loans are to be used to pay O&M Costs as specified in
such Notice of Working Capital Borrowing, disburse the proceeds of such Working Capital Loans in accordance with the instructions set forth in such Notice of Working Capital Borrowing, or
(ii) if such Working Capital Loans are to be used to pay interest on Loans or scheduled payment obligations under Interest Rate Agreements as specified in such Notice of Working Capital Loan
Borrowing, deposit the proceeds such Working Capital Loans into the Debt Payment Account. 

        2.1.7    Conversion of Loans.    

        (a)    Generally.    Borrower may convert Loans (other than CP Conduit Funded LIBOR Construction Loans) from one Type
of Loan to another Type; provided, however, that (i) any conversion of LIBOR Loans into Base Rate
Loans shall be made on, and only on, the first day after the last day of an Interest Period for such LIBOR Loans, and (ii) Loans shall be converted only in amounts of $1,000,000 or integral
multiples of $100,000 in excess thereof. Borrower shall request each such conversion by
delivering to Administrative Agent a written notice in the form of Exhibit C-4 hereto, appropriately completed (a
"Notice of Conversion of Loan Type"), which specifies: 

          (i)  The
Loans, or portion thereof, which are to be converted; 

        (ii)  The
Type into which such Loans, or portion thereof, are to be converted; 

        (iii)  If
such Loans are to be converted into LIBOR Loans, the initial Interest Period selected by Borrower for such Loans (which Interest Period shall be selected in
accordance with Section 2.1.3(b)); 

        (iv)  The
Applicable Margin which will be in effect as of the day of the requested conversion; and 

        (v)  The
proposed date of the requested conversion (which shall be a Banking Day and otherwise in accordance with this  Section 2.1.7). 

        Borrower
shall deliver each Notice of Conversion of Loan Type to Administrative Agent so as to provide at least the applicable Minimum Notice Period. Any Notice of Conversion of Loan
Type shall be irrevocable and Borrower shall be bound to make a conversion in accordance therewith. Each Notice of Conversion of Loan Type shall be delivered by first-class mail or facsimile to
Administrative Agent at the office or to the facsimile number and during the hours specified in Section 11.1;  provided, however, that Borrower shall promptly deliver to Administrative Agent the original of any
Notice of Conversion of Loan Type initially delivered by facsimile. Administrative Agent shall promptly notify each Bank of the contents of each Notice of Conversion of Loan Type. 

11

 

        (b)    CP Conduit LIBOR Construction Loans.    Subject to Sections 2.7
and 2.1.7(b)(ii), each Construction Loan made by any Lender Group that is funded by the CP Conduit that is a member of such Lender Group as a CP Conduit
Funded LIBOR Construction Loan shall automatically be continued as a CP Conduit Funded LIBOR Construction Loan at the end of each Interest Period for an additional Interest Period of (i) one
month, if the prior Interest Period ends before the expiration of the Construction Loan Availability Period, and (ii) three months, if the prior Interest Period ends on or after the expiration
of the Construction Loan Availability Period; provided that each such Interest Period shall commence and end on the fifth Banking Day of the applicable
calendar month and no such Interest Period shall extend beyond the Final Maturity Date. 

        (c)    Assignments within Lender Groups.    If any assignment pursuant to  Section 9.14.2 by a CP Conduit to the Related Bank
that is a member of the same Lender Group is effective after the fourth Banking Day prior to
the last day of such then current Interest Period, notwithstanding anything to the contrary in this Agreement, Borrower may deliver a Notice of Conversion of Loan Type to Administrative Agent with
respect to the applicable Related Bank Construction Loan up to and including the last day of the then current Interest Period, without regard to the applicable Minimum Notice Period. If Borrower fails
to so deliver such a Notice of Conversion of Loan Type, such Related Bank Construction Loan shall automatically convert to a Base Rate Loan on the last day of the then current Interest Period. 

        2.1.8    Prepayments.    

        (a)    Terms of All Prepayments.    Upon the prepayment of any Loan (whether such prepayment is an Optional Prepayment
or a Mandatory Prepayment), Borrower shall pay to Administrative Agent for the account of the Bank which made such Loan, the Lender Group Agent for the Lender Group which made such Loan and/or the
applicable Hedge Bank, as the case may be, (i) all accrued interest to the date of such prepayment on the amount being prepaid, (ii) all accrued fees to the date of such prepayment on
the amount being prepaid, (iii) to the extent required by the terms of the applicable Interest Rate Agreement, all Hedge Breaking Fees owed by Borrower to such Bank, such Lender Group Agent's
CP Conduit and Related Bank or such Hedge Bank as a result of such prepayment and (iv) if such prepayment is the prepayment of a LIBOR Loan on a day other than the last day of an Interest
Period for such LIBOR Loan, all Liquidation Costs incurred by such Bank or by such Lender Group Agent's CP Conduit and Related Bank as a result of such prepayment. Notwithstanding the foregoing, but
only in respect of any Mandatory Prepayment, Borrower shall have the right (so long as neither any Borrower Inchoate Default under Section 7.1.1
nor any Borrower Event of Default shall have occurred and be continuing), by giving five Banking Days' notice to Administrative Agent, in lieu of prepaying a LIBOR Loan on a day other than the last
day of an Interest Period for such LIBOR Loan, to deposit or cause Administrative Agent to deposit, into the Prepayment Account an amount equal to the LIBOR Loan to be prepaid. Such funds shall be
held in the Prepayment Account until the expiration of the Interest Period applicable to the LIBOR Loan to be prepaid at which time the amount deposited in the Prepayment Account shall be used to
prepay such LIBOR Loan and any interest accrued on such amount shall be applied as described in clause (i) of the first sentence of this  Section 2.1.8(a). The deposit of amounts into the
Prepayment Account shall not constitute a prepayment of Loans and all Loans to be prepaid using
the proceeds from such account shall continue to accrue interest at the then applicable interest rate for such Loans until actually prepaid. All prepayments of Construction Loans shall be applied to
reduce the remaining payments required under Section 2.1.1(d) in the inverse order of the maturity of the Construction Loans. Borrower may not
reborrow the principal amount of any Construction Loan which is prepaid; provided that (i) Construction Loans that are repaid pursuant to  Section 6.4(a)(iii)
 may be reborrowed, in accordance with the terms hereof, in connection with a Substitute Project that 

12

 

becomes an Approved Project pursuant to Section 3.11, and (ii) the Construction Loan Commitments may be reutilized as contemplated by  Section 9.17 in accordance with the terms hereof. From the Closing Date to the Amortization Commencement Date, Borrower shall terminate,
partially terminate and/or assign to a Person other than a Credit Party, in each case pursuant to the terms and subject to the conditions of the applicable Interest Rate Agreements, its obligations
under Hedge Transactions such that at no time shall the aggregate notional amount under all Hedge Transactions exceed the sum of the principal amount of Construction Loans outstanding plus the
unfunded portion of the Allocated Portions of the Total Construction Loan Commitment for all Approved Projects. From and after the Amortization Commencement Date, Borrower shall terminate, partially
terminate and/or assign to a
Person other than a Credit Party, in each case pursuant to the terms and subject to the conditions of the applicable Interest Rate Agreements, its obligations under Hedge Transactions such that at no
time shall the aggregate notional amount under all Hedge Transactions exceed the principal amount of Construction Loans outstanding. 

        (b)    Optional Prepayments.    Subject to Section 2.1.8(a),
Borrower may, at its option and without penalty, upon five Banking Days' notice to Administrative Agent, prepay any Loans in whole or in part in a minimum amount of $1,000,000 or an incremental
multiple of $100,000 in excess thereof (any such prepayment, an "Optional Prepayment"). 

        (c)    Mandatory Prepayments.    

          (i)  Borrower
shall prepay (or cause to be prepaid) Loans in connection with a Change of Law to the extent required by  Section 2.7.2. 

        (ii)  Borrower
shall prepay (or cause to be prepaid) Loans with Account Funds in the Distribution Account to the extent required by  Section 4.7.2 of the Depositary Agreement. 

        (iii)  Borrower
shall prepay (or cause to be prepaid) Loans in connection with the receipt of Loss Proceeds to the extent required by  Section 4.8.2 of the Depositary Agreement. 

        (iv)  Borrower
shall prepay (or cause to be prepaid) Loans in connection with the transfer by Borrower of its equity interests in an Approved Project Company to the extent
required by Section 6.4(a)(iii). 

        (v)  Borrower
shall prepay (or cause to be prepaid) Loans to the extent expressly required by any other provision of this Agreement or any other Credit Document. 

        Except
as otherwise expressly set forth herein, prepayments of less than all of the outstanding Loans made pursuant to clauses (ii) through (v) above shall be applied  first, to the prepayment of
outstanding Construction Loans until all Construction Loans have been repaid in full;  second, to the prepayment of outstanding Working Capital Loans and Project LC Loans, pro
rata in
accordance with the principal amounts of Working Capital Loans and Project LC Loans then outstanding, until all Working Capital Loans and Project LC Loans have been repaid in full; and  third, to the
prepayment of outstanding DSR LC Loans until all DSR LC Loans have been repaid in full. 

        2.2    Letter of Credit Facilities.    

        2.2.1    Issuance of the Letters of Credit.    Subject to the terms and conditions set forth in this Agreement, the LC
Bank shall, during the Working Capital/LC Availability Period, on each Banking Day specified in a Notice of LC Activity delivered in accordance with  Section 2.2.3, issue, extend the Expiration Date
of or increase the Stated Amount of, for the account of Borrower, the Letter(s) of Credit to
which such Notice of LC Activity relates, and deliver each such Letter of Credit (or a notice of extension of the Expiration Date or increase in the Stated Amount thereof) to the applicable LC
Beneficiary. Subject to Section 2.2.7(b), the LC Bank shall not modify the 

13

 

conditions for draws or terms of availability for any Letter of Credit issued and outstanding hereunder without Borrower's consent. 

        2.2.2    Availability.    The LC Bank shall, subject to the terms and conditions of this Agreement, make Letter(s) of
Credit available to Borrower and/or the Approved Project Companies, for the account of Borrower, (a) solely to enable the Approved Project Companies to provide security for their obligations to
the counterparties under the LC Eligible Project Documents in accordance with the terms of the LC Eligible Project Documents (each, a "Project Letter of
Credit" and, collectively, the "Project Letters of Credit"), and (b) solely to maintain the DSR Required Balance in the
Debt Service Reserve Account pursuant to the terms of Section 4.6 of the Depositary Agreement (the "DSR Letter of
Credit"). Project Letters of Credit shall be substantially in the form of Exhibit B-4 (or as otherwise
mutually agreed by Administrative Agent, the LC Bank and Borrower) and the DSR Letter of Credit shall be in the form of Exhibit B-5.
No Project Letter of Credit shall be issued, renewed, replaced or extended by the LC Bank until such time (or a reasonable period before such time) as required under the applicable LC Eligible Project
Document pursuant to which such Letter of Credit is being issued, as certified to the LC Bank in a duly completed Notice of LC Activity. The Expiration Date of each Letter of Credit shall be on or
prior to the last day of the Working Capital/LC Availability Period. 

        2.2.3    Notice of LC Activity.    Borrower shall request the issuance, extension of the Expiration Date or increase
in the Stated Amount of any Letter of Credit by delivering to Administrative Agent and the LC Bank an irrevocable written notice in the form of  Exhibit C-5, appropriately completed (a "Notice of LC Activity"), which specifies,
among other things: 

        (a)  The
particulars of the Letter of Credit to be issued or the specific Letter of Credit the Expiration Date of which is to be extended or the Stated Amount of which is to
be increased (including, for a Project Letter of Credit, the Approved Project for which such Project Letter of Credit is being issued, extended or increased); 

        (b)  Subject
to Section 2.2.2, the issue date and Expiration Date of the Letter of Credit to be issued or the new
Expiration Date of the Letter of Credit to be extended; and 

        (c)  The
Stated Amount (as increased, if applicable) of the Letter of Credit, provided that (i) the Stated Amount of
any requested Project Letter of Credit shall not exceed the then current Available Working Capital/Project LC Commitment, and (ii) the Stated Amount of the requested DSR Letter of Credit shall
not exceed the then current Available DSR LC Commitment. 

        Borrower
shall give the Notice of LC Activity to Administrative Agent and the LC Bank at least five Banking Days before the requested date of issuance of any Letter of Credit, and at
least three Banking Days before the requested date of any extension of the Expiration Date of any Letter of Credit or increase in the Stated Amount of any Letter of Credit. Any Notice of LC Activity,
once given by Borrower, may not be modified or revoked. Administrative Agent shall promptly notify each Bank of the contents of each Notice of LC Activity. 

14

  

        2.2.4    Letter of Credit Loans and Reimbursement Obligations.    

        (a)    Project LC Loans.    To the extent provided in  Section 2.2.8, each Bank severally agrees to advance to the LC Bank, for
the account of Borrower, such Bank's Proportionate Share of the full
amount of any Drawing Payment under any Project Letter of Credit. Upon the making of any Drawing Payment, Borrower shall be obligated to reimburse the LC Bank for such Drawing Payment and, for
convenience, such Reimbursement Obligation shall be deemed to constitute a Borrowing of loans (each, a "Project LC Loan" and, collectively, the
"Project LC Loans") in the amount of such Drawing Payment, consisting of a Project LC Loan made by each Bank in the amount of such Bank's Proportionate
Share of such Drawing Payment. All Project LC Loans shall be repaid on each Quarterly Date to the extent of Account Funds available for such purpose in the Debt Payment Account on such Quarterly Date,
after giving effect to transfers from the Applicable Revenue Account to the Debt Payment Account on such Quarterly Date; provided,  however, that each
Project LC Loan shall be repaid in full on the Final Maturity Date. In the event that any Project LC Loan cannot for any reason be
made on the date otherwise required above (including, without limitation, as a result of the commencement of a Bankruptcy Event with respect to Borrower), then each Bank hereby agrees that it shall
forthwith purchase from the LC Bank a participation interest in the unreimbursed Drawing Payment made by the LC Bank under the Project Letter of Credit, in an amount equal to such Bank's Proportionate
Share of such unreimbursed Drawing Payment, as provided in Section 2.2.8. 

        (b)    DSR LC Loans.    To the extent provided in  Section 2.2.8, each Bank severally agrees to advance to the LC Bank, for the
account of Borrower, such Bank's Proportionate Share of the full
amount of any Drawing Payment under the DSR Letter of Credit. Upon the making of any Drawing Payment, Borrower shall be obligated to reimburse the LC Bank for such Drawing Payment and, for
convenience, such Reimbursement Obligation shall be deemed to constitute a Borrowing of loans (a "DSR LC Loan" and, collectively, the
"DSR LC Loans") in the amount of such Drawing Payment, consisting of a DSR LC Loan made by each Bank in the amount of such Bank's Proportionate Share of
such Drawing Payment. All DSR LC Loans shall be repaid on each Monthly Date to the extent of Account Funds available for such purpose in the Post-Completion Revenue Account, after giving
effect to the disbursements described in priorities First through Fourth of  Section 4.3.2(a) of the
Depositary Agreement; provided,  however, that each DSR LC Loan shall be repaid in full on the Final Maturity Date. In the event that any DSR LC Loan cannot
for any reason be made on
the date otherwise required above (including, without limitation, as a result of the commencement of a Bankruptcy Event with respect to Borrower), then each Bank hereby agrees that it shall forthwith
purchase from the LC Bank a participation interest in the unreimbursed Drawing Payment made by the LC Bank under the DSR Letter of Credit, in an amount equal to such Bank's Proportionate Share of such
unreimbursed Drawing Payment, as provided in Section 2.2.8. 

        (c)    Interest Rate Basis.    Each Project LC Loan and DSR LC Loan shall initially be a Base Rate Loan. Borrower may
convert any such Base Rate Loan to a LIBOR Loan in accordance with Section 2.1.7. 

        2.2.5    Project LC Loan Interest.    Borrower shall pay interest on the unpaid principal amount of each Project LC
Loan from the Drawing Date associated with such Project LC Loan until the maturity or prepayment thereof at the following rates per annum: 

        (a)  with
respect to the principal portion of such Project LC Loan which is, and during the periods when such portion of such Project LC Loan is, a Base Rate Project LC Loan,
at a 

15

 

rate per annum equal to the Base Rate plus the Applicable Margin, such rate to change from time to time as the Base Rate shall change; and 

        (b)  with
respect to the principal portion of such Project LC Loan which is, and during the periods when such portion of such Project LC Loan is, a LIBOR Project LC Loan, at
a rate per annum during each Interest Period for such LIBOR Project LC Loan equal to the LIBO Rate for such Interest Period, plus the Applicable Margin. 

        2.2.6    DSR LC Loan Interest.    Borrower shall pay interest on the unpaid principal amount of each DSR LC Loan from
the Drawing Date associated with such DSR LC Loan until the maturity or prepayment thereof at the following rates per annum: 

        (a)  with
respect to the principal portion of such DSR LC Loan which is, and during the periods when such portion of such DSR LC Loan is, a Base Rate DSR LC Loan, at a rate
per annum equal to the Base Rate plus the Applicable Margin plus 0.25%, such rate to change from time to time as the Base Rate shall change; and 

        (b)  with
respect to the principal portion of such DSR LC Loan which is, and during the periods when such portion of such DSR LC Loan is, a LIBOR DSR LC Loan, at a rate per
annum during each Interest Period for such LIBOR DSR LC Loan equal to the LIBO Rate for such Interest Period plus the Applicable Margin plus 0.25%. 

        2.2.7    Reduction and Reinstatement of Stated Amounts; Cancellation.    

        (a)  The
Stated Amount of each Letter of Credit shall be reduced by the amount of Drawing Payments made thereunder. Notwithstanding anything to the contrary contained in this  Section 2.2, once so reduced,
the Stated Amount of any Letter of Credit shall not be reinstated except (i) with the prior
written consent of Administrative Agent, the LC Bank and the Majority Banks (or, if such reinstatement would cause the Stated Amount of any Letter of Credit to exceed the limitations specified in  Section 2.2.3(c)
, upon the prior written consent of Administrative Agent, the LC Bank and all of the Banks), or (ii) upon repayment by
Borrower of the Letter of Credit Loans corresponding to such Drawing Payment and satisfaction of the conditions for an increase in the Stated Amount of a Letter of Credit set forth in
(x) Section 2.2.3 and (y) with respect to a Project Letter of Credit,  Section 3.12.2 (other than with respect to any Project Event of
Default or Project Inchoate Default that would be cured by the reinstatement of
the Stated Amount of such Letter of Credit) and Section 3.12.3. 

        (b)  Upon
the occurrence and during the continuation of a Borrower Event of Default under Section 7.1.4 or at such time
as, pursuant to the terms hereof, Administrative Agent and the Banks have accelerated the Obligations, the LC Bank (acting at the direction of Administrative Agent and the Majority Banks) shall be
entitled to cancel all outstanding Letters of Credit any time at least 30 days after delivery to the LC Beneficiary of each Letter of Credit that will be canceled a written notice of such
intent to cancel, whereupon the LC Beneficiary shall be entitled to draw upon the applicable Letter of Credit in accordance with its terms. 

        (c)  The
LC Bank shall be entitled to cancel any Letter of Credit on its then current Stated Expiration Date (as defined in such Letter of Credit) by delivering a Notice of
Non-Extension (as defined in such Letter of Credit) to the LC Beneficiary of such Letter of Credit at least 60 days prior to such Stated Expiration Date in accordance with the terms
of such Letter of Credit. 

        2.2.8    Bank Participation.    Each Bank severally agrees to participate with the LC Bank in the extension of credit
arising from the issuance of the Letters of Credit in an amount equal to such Bank's Proportionate Share of the Stated Amount of each Letter of Credit, and the issuance of a 

16

 

Letter of Credit shall be deemed a confirmation to the LC Bank of such participation in such amount. The LC Bank may request the Banks to pay to the LC Bank their respective Proportionate Shares of
all or any portion of any Drawing Payment made or to be made by the LC Bank under any Letter of Credit by contacting each Bank and Administrative Agent telephonically (promptly confirmed in writing)
at any time after the LC Bank has received notice of or request for such Drawing Payment, and specifying the amount of such Drawing Payment, such Bank's Proportionate Share thereof, and the date on
which such Drawing Payment is to be made or was made; provided, however, that the LC Bank shall not
request the Banks to make any payment under this Section 2.2.8 in connection with any portion of a Drawing Payment for which the LC Bank has been
reimbursed by Borrower (unless such reimbursement has been thereafter rescinded or recovered by Borrower). Upon receipt of any such request for payment from the LC Bank, each Bank shall pay to the LC
Bank such Bank's Proportionate Share of the unreimbursed portion of such Drawing Payment, together with interest thereon at a per annum rate equal to the Federal Funds Rate, as in effect from time to
time, from the date of such Drawing Payment to the date on which such Bank makes payment. Each Bank's obligation to make each such payment to the LC Bank shall be absolute, unconditional and
irrevocable and shall not be affected by any circumstance whatsoever, including the occurrence or continuation of any Borrower Inchoate Default or Borrower Event of Default, or the failure of any
other Bank to make any payment under this Section 2.2.8, and each Bank further agrees that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever. 

        2.2.9    Commercial Practices.    Borrower assumes all risks of the acts or omissions of any LC Beneficiary or
transferee of any Letter of Credit with respect to the use of such Letter of Credit. Borrower agrees that neither the LC Bank, Administrative Agent nor any Bank (nor any of their respective directors,
officers or employees) shall be liable or responsible for: (a) the use which may be made of any Letter of Credit or for any acts or omissions of any LC Beneficiary or transferee in connection
therewith; (b) any reference which may be made to this Agreement or to any Letter of Credit in any agreements, instruments or other documents; (c) the validity, sufficiency or
genuineness of documents other than the Letters of Credit, or of any endorsement(s) thereon, even if such documents should in fact prove to be in any or all respects invalid, insufficient, fraudulent
or forged or any statement therein prove to be untrue or inaccurate in any respect whatsoever; (d) payment by the LC Bank against presentation of documents which do not strictly comply with the
terms of the applicable Letter of Credit, including failure of any documents to bear any reference or adequate reference to such Letter of Credit; or (e) any other circumstances whatsoever in
making or failing to make payment under any Letter of Credit, except only that the LC Bank shall be liable to Borrower for acts or events described in clauses (a) through (e) above, to
the extent, but only to the extent, of any direct damages, as opposed to indirect, special or consequential damages, suffered by Borrower which Borrower proves were caused by (i) the LC Bank's
willful misconduct or gross negligence in determining whether a drawing made under the applicable Letter of Credit complies with the terms and conditions therefor stated in such Letter of Credit or
(ii) the LC Bank's willful failure to pay under any Letter of Credit after receiving a drawing request from the respective LC Beneficiary strictly complying with the terms and conditions of the
applicable Letter of Credit. Without limiting the foregoing, the LC Bank may accept any document that appears on its face to be in order, without responsibility for further investigation. Borrower
hereby waives any right to object to any payment made under a Letter of Credit with regard to a drawing that is in the form provided in such Letter of Credit but which varies with respect to
punctuation (except punctuation with respect to any Dollar amount specified therein), capitalization, spelling or similar matters of form. 

        2.2.10    Reimbursement Obligations Absolute.    Subject to the second sentence in each of  Sections 2.2.4(a) and (b), Borrower's obligation to repay Reimbursement Obligations and to pay interest
thereon shall be absolute, unconditional and irrevocable, and shall be performed strictly in 

17

 

accordance with the terms of this Agreement under all circumstances, including (a) any lack of validity or enforceability of any of the Operative Documents, (b) any amendment or waiver
of or any consent to departure from all or any terms of any of the Operative Documents, (c) the existence of any claim, setoff, defense or other right which Borrower may have at any time
against any LC Beneficiary or any transferee of any Letter of Credit (or any Persons for whom any such beneficiary or transferee may be acting), Administrative Agent, the LC Bank, any Bank or any
other Person, whether in connection with this Agreement, the transactions contemplated herein or in the other Operative Documents, or in any unrelated transaction, (d) any demand, statement,
certificate, draft or other document presented under such Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any
respect, unless the LC Bank acts with willful misconduct in honoring such demand, statement, certificate, draft or other document, (e) payment by the LC Bank under any Letter of Credit against
presentation of any demand, statement, certificate, draft or other document which does not strictly comply with the terms of any Letter of Credit, unless such payment constitutes gross negligence or
willful misconduct on the part of the LC Bank, (f) any non-application or misapplication by any LC Beneficiary of the proceeds of any Drawing Payment under such Letter of Credit or
any other act or omission of such beneficiary in connection with such Letter of Credit, (g) any extension of time for or delay, renewal or compromise of or other indulgence or modification to
the
Drawing Payment granted or agreed to by the LC Bank and the Banks, except to the extent of the same, with or without notice to or approval by Borrower, (h) any failure to preserve or protect
any Collateral, any failure to perfect or preserve the perfection of any Lien thereon, or the release of any of the Collateral securing the performance or observance of the terms of this Agreement or
any of the other Operative Documents, (i) the fact that a Borrower Event of Default shall have occurred and be continuing, or (j) any other circumstances or happenings whatsoever
relating to Borrower, such Reimbursement Obligation or the Projects, including the non-completion of any Project for any cause whatsoever, the failure of a Project Company to occupy or use
its Project in the manner contemplated by the Operative Documents or otherwise, any defect in title, design, operation, merchantability, fitness or condition of the Projects or in the suitability of
the Projects for Borrower's or the Project Companies' purposes or needs, any failure of consideration, destruction of or damage to the Projects, any commercial frustration of purpose, the taking by
condemnation of title to or the use of all or any part of the Projects, any Change of Law, any failure of any Person to perform or observe any agreement, whether express or implied, or any duty,
liability or obligation arising out of or in connection with the Operative Documents to which such Person is a party. 

        2.2.11    Term of Letters of Credit.    Unless terminated earlier in accordance with its terms, or extended pursuant
to Section 2.2.3, each Letter of Credit shall expire at 12:01 a.m. on the Expiration Date stated therein. The Expiration Date of each
Letter of Credit shall be no later than the earliest of (a) 15 Banking Days following the expiration of the applicable Approved Project Company's letter of credit obligations under the
applicable LC Eligible Project Document in connection with which any Project Letter of Credit is issued (as notified by Borrower to the LC Bank), (b) cancellation of such Letter of Credit
pursuant to Section 2.2.7(b) or (c) or (c) the Final Maturity Date. 

        2.2.12    LC Bank's Right to Replace Non-Investment Grade Bank.    If at any time any Bank (a
"Non-Investment Grade Bank") is rated less than Baa3 by Moody's or less than BBB- by S&P, the LC Bank shall have the right to
request that the Non-Investment Grade Bank be replaced by another Person (a "Replacement Bank") that is acceptable to the LC Bank,
Administrative Agent and, unless a Borrower Event of Default or Borrower Inchoate Default has occurred and is continuing, Borrower, and that is willing to assume the Non-Investment Grade
Bank's obligations under this Agreement. If a Replacement Bank is located, the Replacement Bank will be substituted for the Non-Investment Grade Bank upon execution and delivery to
Administrative 

18

 

Agent of an Assignment Agreement between the Non-Investment Grade Bank and the Replacement Bank substantially in the form of  Exhibit L. Notwithstanding the foregoing, the LC Bank will not have the
right to request that the Non-Investment Grade Bank be
replaced by a Replacement Bank if: (a) the Non-Investment Grade Bank was a Non-Investment Grade Bank on the day on which it became a Bank hereunder; or (b) the
Non-Investment Grade Bank, within three Banking Days after it becomes a Non-Investment Grade Bank, provides any one or more of the following in an aggregate amount equal to the
sum of its Working Capital/Project LC Commitment and its DSR LC Commitment as security for its obligations under Section 2.2.8: (i) cash
to be held by the LC Bank in a segregated account; or (ii) a letter of credit or guaranty from a Person that is rated at least Baa3 by Moody's and at least BBB- by S&P in form and
substance reasonable satisfactory to the LC Bank. Notwithstanding the foregoing, if such Non-Investment Grade Bank is also a Related Bank, the Replacement Bank shall also assume the
obligations of the Lender Group of which such Non-Investment Grade Bank is a member under this Agreement (including any outstanding Loans made hereunder). 

        2.2.13    Special Provisions Relating to Letters of Credit.    Notwithstanding any other provision of this Agreement
to the contrary: 

        (a)  any
automatic extension of the Expiration Date of a Letter of Credit that is expressly provided for in such Letter of Credit shall not require the satisfaction of the
conditions precedent to the extension of an Expiration Date set forth in Sections 2.2.3 and 3.5 or  3.6, as
the case may be; 

        (b)  any
automatic increase in the Stated Amount of a Letter of Credit that is expressly provided for in such Letter of Credit shall not require the satisfaction of the
conditions precedent to an increase in a Stated Amount set forth in Sections 2.2.3 and 3.5 or  3.6, as the
case may be (provided that a reinstatement of a Stated Amount as contemplated by  Section 2.2.7(a) shall not be considered an automatic increase in
such Stated Amount for purposes of this clause (b)); and 

        (c)  with
respect to any Letter of Credit that expressly provides for an automatic increase in the Stated Amount thereof, (i) the Stated Amount of such Letter of
Credit for purposes of the calculation of the Working Capital/Project LC Commitment Fee and the Letter of Credit Fee for such Letter of Credit shall be the Stated Amount for the current Drawing Period
as set forth in Schedule I to such Letter of Credit, and (ii) the Stated Amount of such Letter of Credit for all other purposes hereunder
(including the calculation of the Available Working Capital/Project LC Commitment other than in connection with the Working Capital/Project LC Commitment Fee) shall be the highest Stated Amount set
forth in Schedule I to such Letter of Credit. 

        2.3    Total Commitments.    

        2.3.1    Initial Commitments and Increases in Initial Commitments.    As of the Closing Date, the Committed
Construction Loan Dollar Amount is $950,000,000 (the "Initial Committed Construction Loan Dollar Amount"), the Committed Working Capital/Project LC
Dollar Amount is $80,000,000 (the "Initial Committed Working Capital/Project LC Dollar Amount"), and the Committed DSR LC Dollar Amount is $45,000,000
(the "Initial Committed DSR LC Dollar Amount and, collectively with the Initial Committed Construction Loan Dollar Amount and the Initial Committed
Working Capital/Project LC Dollar Amount, the "Initial Committed Dollar Amounts"). Each Initial Committed Dollar Amount shall be increased by the
applicable Incremental Commitment set forth in each Joinder Agreement entered into following the Closing Date. 

        2.3.2    Total Construction Loan Commitment.    Subject to  Section 2.3.5(a), the aggregate principal amount of all Construction
Loans outstanding at any time shall not exceed the then current Committed
Construction Loan Dollar Amount or, if the then current Committed 

19

 

Construction Loan Dollar Amount is (1) reduced by Borrower pursuant to Section 2.3.6(a), (2) automatically reduced pursuant to  Section 2.3.6(b) or (3) automatically increased pursuant to the
proviso to Section 2.3.6(b)(ii), such adjusted Committed Construction Loan Dollar Amount (such then current Committed Construction Loan Dollar
Amount, as so adjusted from time to time, the "Total Construction Loan Commitment"). The amount of each Bank's and each Lender Group's Construction Loan
Commitment is set forth in Exhibit I hereto (which Exhibit shall be automatically amended without further action (x) upon the assignment
of any Bank's or any Lender Group's Construction Loan Commitment in accordance with the terms hereof to give effect to any such assignment, (y) upon the addition of a Bank or Lender Group
hereunder pursuant to a Joinder Agreement entered into in accordance with Section 9.17 or (z) upon any adjustment of the Total
Construction Loan Commitment in accordance with this Section 2.3.2 to give effect to any such adjustment). The amount of each Related Bank's
Parallel Funding Commitment is set forth in Exhibit I hereto (which Exhibit shall be automatically amended without further action (x) upon
the assignment of any Related Bank's Parallel Funding Commitment in accordance with the terms hereof to give effect to any such assignment, (y) upon the addition of a Related Bank hereunder
pursuant to a Joinder Agreement entered into in accordance with Section 9.17 or (z) upon any adjustment of the Construction Loan
Commitment of such Related Bank's Lender Group in accordance with this Section 2.3.2 to give effect to any such adjustment. Notwithstanding
anything to the contrary contained in this Agreement or any other Credit Document, the aggregate principal amount of all Construction Loans outstanding shall not exceed $1,052,142,375 at any time
prior to the date on which the fourth Project becomes an Approved Project hereunder (other than in connection with a substitution of a Substitute Project for an Approved Project in accordance with  Section 3.11). 

        2.3.3    Total Working Capital/Project LC Commitment.    Subject to  Section 2.3.5(b), the Total Working Capital/Project LC
Outstandings shall not at any time exceed the then current Committed Working
Capital/Project LC Dollar Amount or, if the then current Committed Working Capital/Project LC Dollar Amount is (1) reduced by Borrower pursuant to  Section 2.3.6(a), (2) automatically
reduced pursuant to Section 2.3.6(b) or
(3) automatically increased pursuant to the proviso to Section 2.3.6(b)(ii), such adjusted Committed Working Capital/Project LC Dollar
Amount (such then current Committed Working Capital/Project LC Dollar Amount, as so adjusted from time to time, the "Total Working Capital/Project LC
Commitment"). The amount of each Bank's Working Capital/Project LC Commitment is set forth in Exhibit I hereto (which
Exhibit shall be automatically amended without further action (x) upon the assignment of any Bank's Construction Loan Commitment in accordance with the terms hereof to give effect to any such
assignment, (y) upon the addition of a Bank hereunder pursuant to a Joinder Agreement entered into in accordance with Section 9.17 or
(z) upon any adjustment of the Total Working Capital/Project LC Commitment in accordance with this Section 2.3.3 to give effect to any
such adjustment). 

        2.3.4    Total DSR LC Commitment.    Subject to  Section 2.3.5(b), the Total DSR LC Outstandings shall not at any time exceed the
then current Committed DSR LC Dollar Amount or, if the then
current Committed DSR LC Dollar Amount is (1) reduced by Borrower pursuant to Section 2.3.6(a), (2) automatically reduced pursuant
to Section 2.3.6(b) or (3) automatically increased pursuant to the proviso to  Section 2.3.6(b)(ii), such adjusted Committed DSR LC Dollar
Amount (such then current Committed DSR LC Dollar Amount, as so adjusted from time to
time, the "Total DSR LC Commitment"). The amount of each Bank's DSR LC Commitment is set forth in  Exhibit I hereto (which Exhibit shall be
automatically amended without further action (x) upon the assignment of any Bank's Construction
Loan Commitment in accordance with the terms hereof to give effect to any such assignment, (y) upon the addition of a Bank hereunder pursuant to a Joinder Agreement entered into in accordance
with Section 9.17 or (z) upon any adjustment of the 

20

 

Total DSR LC Commitment in accordance with this Section 2.3.4 to give effect to any such adjustment). 

        2.3.5    Allocated Portions.    

        (a)    Total Construction Loan Commitment.    A Project's Allocated Portion of the Total Construction Loan Commitment
cannot be used for Borrowings of Construction Loans unless and until such Project becomes an Approved Project in accordance with the terms hereof. For so long as a Project is an Approved Project
hereunder, such Project's Allocated Portion of the Total Construction Loan Commitment may be used for Borrowings of Construction Loans for all Approved Projects in accordance with the terms hereof. 

        (b)    Total Working Capital/Project LC Commitment.    A Project's Allocated Portion of the Total Working
Capital/Project LC Commitment cannot be used for Borrowings of Working Capital Loans or issuances of Project Letters of Credit unless and until such Project becomes an Approved Project in accordance
with the terms hereof. For so long as a Project is an Approved Project hereunder, such Project's Allocated Portion of the Total Working Capital/Project LC Commitment may be used for (i) prior
to the Substantial Completion Date for such Project, issuances of Project Letters of Credit for all Approved Projects in accordance with the terms hereof, and (ii) on and after the Substantial
Completion Date for such Project, Borrowings of Working Capital Loans and issuances of Project Letters of Credit for all Approved Projects in accordance with the terms hereof. Notwithstanding anything
in this clause (b) or any other provision of any Credit Document to the contrary, (1) no Borrowings of Working Capital Loans for an Approved Project may be made prior to the Substantial
Completion Date for such Approved Project, (2) so long as the Millennium O&M Cost Contribution Agreement is in effect, no Borrowings of Working Capital Loans may be used to pay (A) O&M
Costs (other than insurance premiums and payments made in connection with any finite risk insurance contemplated by Exhibit M to the Project
Company Guaranty for the Millennium Project) incurred for the Millennium Project during Transition Outages and Schedule A Outages or (B) repair and/or replacement costs associated with
Transition Outages and Schedule A Outages. 

        (c)    Total DSR LC Commitment.    A Project's Allocated Portion of the Total DSR LC Commitment cannot be used for the
issuance of the DSR Letter of Credit unless such Project is an Approved Project at the time of such issuance. Notwithstanding anything in this clause (c) or any other provision of any Credit
Document to the contrary, the DSR Letter of Credit shall not be issued until the DSR Start Date. 

        (d)    Books and Records.    The books and records of any Approved Project Company need not, at any time, reflect the
Allocated Portions for the applicable Approved Project or Loans borrowed in respect of such Approved Project. Borrowing notices and related certifications provided hereunder shall be relevant only for
purposes of administering, and compliance with, this Agreement and the Borrowings hereunder (including in connection with a required prepayment of Loans pursuant to  Section 6.4(b)(iii)). Borrower
may, at any time and from time to time, adjust the books and records of any Approved Project Company and/or
Approved Intermediate Holding Company for any reason, provided that (i) the aggregate amount of debt and equity for all Approved Project
Companies, together with the aggregate amount of debt and equity for all Approved Intermediate Holding Companies (as determined on a consolidated basis), must reflect the debt and equity of Borrower,
and (ii) the books and records of Borrower, each Approved Project Company and each Approved Intermediate Holding Company must
be in compliance with the covenants set forth in Section 5.4 hereof, Section 4.3of the
applicable Project Company Guaranty and Section 5.2 of the applicable Pledge Agreement, respectively. 

21

 

        2.3.6    Reductions and Cancellations.    

        (a)    Optional Reductions and Cancellations.    Borrower may, from time to time upon five Banking Days written notice
to Administrative Agent, permanently reduce, (i) by a minimum amount of $1,000,000 or an integral multiple of $100,000 in excess thereof, or cancel in its entirety, the Total Construction Loan
Commitment, or (ii) by a minimum amount of $500,000 or an integral multiple of $50,000 in excess thereof, or cancel in its entirety, the Total Working Capital/Project LC Commitment or the Total
DSR LC Commitment; provided, however, that: 

          (i)  Borrower
may not reduce or cancel the Total Construction Loan Commitment if (A) after giving effect to such reduction or cancellation, either (1) the
aggregate principal amount of all Construction Loans then outstanding would exceed the Total Construction Loan Commitment, or (2) the Available Construction Funds for the Approved Projects that
have not achieved Completion would not, in the reasonable judgment of Administrative Agent and the Independent Engineer, be equal to or exceed the remaining Project Costs (including the Contingency)
for such Approved Projects, or (B) such reduction or cancellation would cause a violation of any other provision of this Agreement or the other Credit Documents; 

        (ii)  Borrower
may not reduce or cancel the Total Working Capital/Project LC Commitment if (A) after giving effect to such reduction or cancellation, either
(1) the Total Working Capital/Project LC Outstandings would exceed the Total Working Capital/Project LC Commitment, or (2) the remaining Total Working Capital/Project LC Commitment would
not, in the reasonable judgment of Administrative Agent, the Independent Engineer and the Fuel Consultant, as applicable, be sufficient to fund the ongoing O&M Costs and Major Maintenance expenses of
the Approved Projects (after giving effect to Operating Revenues available or expected to be available for such purpose) and secure the Approved Projects' existing or reasonably anticipated
obligations under the LC Eligible Project Documents (after giving effect to alternate arrangements, if applicable, made by Borrower or any of its Affiliates), or (B) such reduction or
cancellation would cause a violation of any other provision of this Agreement, the other Credit Documents or any applicable LC Eligible Project Document; and 

        (iii)  Borrower
may not reduce or cancel the Total DSR LC Commitment if after giving effect to such reduction or cancellation, either (A) the Total DSR LC Outstandings
would exceed the Total DSR LC Commitment, or (B) the Total DSR LC Commitment plus the Account Funds then held in the Debt Service Reserve Account would be less than the DSR Required Balance. 

Borrower
shall pay to Administrative Agent any Commitment Fees then due in respect of the canceled portion of the applicable Total Commitment upon any reduction thereof and, from the effective date of
any reduction, the Commitment Fees shall be computed on the basis of the applicable Total Commitment as so reduced. Once reduced or canceled in accordance with this  Section 2.3.6(a), no Total
Commitment may be increased or reinstated. Any reductions pursuant to this  Section 2.3.6(a) shall be applied ratably to each Bank's and each Lender Group's respective Commitments in accordance with
 Section 2.6.1. 

        (b)    Automatic Reductions and Increases.    

          (i)  On
the Adjustment Date, without any action by Borrower, Administrative Agent or any other Person, (A) each Total Commitment shall be automatically and
permanently reduced by the Allocated Portion of such Total Commitment for any Project that is not an Approved Project as of the Adjustment Date, and (B) each such Allocated Portion shall be
automatically and permanently reduced to $0. Borrower shall pay to Administrative Agent any Commitment Fees then due in respect of the canceled portion of each Total 

22

 

Commitment upon such reduction and, from the effective date of such reduction, the Commitment Fees shall be computed on the basis of the Total Commitments as so reduced. Once so reduced, no Total
Commitment may be increased or reinstated. Any reductions pursuant to this Section 2.3.6(b)(i) shall be applied ratably to each Bank's and each
Lender Group's respective Commitments in accordance with Section 2.6.1. 

        (ii)  If
Borrower transfers its equity interests in any Approved Project Company in accordance with Section 6.4, then
in addition to the prepayment of Loans required pursuant to Section 6.4(a)(iii) and subject to the proviso to the third sentence of this
clause (ii), (A) the Allocated Portion of the Total Construction Loan Commitment for such Approved Project shall be automatically and permanently reduced by an amount that, together with
such prepayment of Construction Loans, results in compliance with the required minimum and average annual projected Debt Service Coverage Ratios set forth in  Section 6.4(a)(iii), and (B) the
Allocated Portions of the Total Working Capital/Project LC Commitment and the Total DSR LC Commitment for
such Approved Project shall be automatically and permanently reduced to $0. Borrower shall pay to Administrative Agent for the benefit of the applicable Bank(s) and/or Lender Group(s) any Commitment
Fees then due in respect of the canceled portion of each Total Commitment upon such reduction and, from the effective date of such reduction, the Commitment Fees shall be computed on the basis of the
Total Commitments as so reduced. Once so reduced, no Total Commitment may be increased or reinstated; provided that if the Approved Project released
pursuant to Section 6.4 is replaced by a Substitute Project in accordance with  Section 3.11, then each Total Commitment shall be increased and
reinstated by the Allocated Portion thereof for such Substitute Project upon such
Substitute Project becoming an Approved Project, and the Commitment Fees shall thereafter be computed on the basis of the Total Commitments as so increased;  provided, however, that the Total Construction Loan Commitment shall in no event be greater than the
then current Committed Construction Loan Dollar Amount, the Total Working Capital/Project LC Commitment shall in no event be greater than the then current Committed Working Capital/Project LC Dollar
Amount and the Total DSR LC Commitment shall in no event be greater than the then current Committed DSR LC Dollar Amount. Any reductions (and increases, if applicable) pursuant to this  Section 2.3.6(b)(ii) shall be applied ratably to each Bank's and each Lender Group's respective Commitments in accordance with  Section 2.6.1. 

        (iii)  On
March 31, 2002, (A) if the condition precedent set forth in Section 3.2.11 has not been
satisfied and (B) the then current Total Commitments exceed $1,192,142,375 (less the amount of any reductions in the Total Commitments theretofore made pursuant to  Section 2.3.6(a)), then
without any action by Borrower, Administrative Agent or any other Person, the Total Commitments shall be automatically
and permanently reduced (with such reduction being applied pro rata according to the then current amount of each Total Commitment) to $1,192,142,375
(less the amount of any reductions in the Total Commitments theretofore made pursuant to Section 2.3.6(a)). Borrower shall pay to Administrative
Agent any Commitment Fees then due in respect of the canceled portion of each Total Commitment upon such reduction and, from the effective date of such reduction, the Commitment Fees shall be computed
on the basis of the Total Commitments as so reduced. Once so reduced, no Total Commitment may be increased or reinstated. Any reductions pursuant to this  Section 2.3.6(b)(iii) shall be applied to
the Banks' and the Lender Groups' respective Commitments as agreed to by the Banks and the Lender
Groups in a separate agreement. 

23

 

        2.3.7    Parallel Funding Commitments Termination Date.    

        (a)  With
respect to any Related Bank whose then current Parallel Funding Commitment Termination Date is earlier than the Date Certain, no earlier than the 45th
day and no later than the 30thday before such Related Bank's then current Parallel Funding Commitment Termination Date, the Lender Group Agent on behalf of Borrower shall by written
notice to such Related Bank request such Related Bank to renew its Parallel Funding Commitment for a period not exceeding 364 days immediately following the then Parallel Funding Commitment
Termination Date. Each such renewal shall be in the sole and absolute discretion of such Related Bank. If any such Related Bank does not agree to so renew its Parallel Funding Commitment before the
10th Banking Day prior to its then Parallel Funding Commitment Termination Date, such Related Bank shall be deemed to have declined to renew it Parallel Funding Commitment. If any such
Related Bank agrees in writing to so renew its Parallel Funding Commitment, the Parallel Funding Commitment Termination Date of such Related Bank as set forth in  Exhibit I shall be automatically
amended without further action to reflect such renewal. 

        (b)  During
the Construction Loan Availability Period, if any Related Bank whose Parallel Funding Commitment Termination Date is earlier than the Date Certain has not, as of
the fifth Banking Day prior to its then current Parallel Funding Commitment Termination Date, extended its Parallel Funding Commitment Termination Date to a date that is the earlier of (i) an
additional 364 days and (ii) the Date Certain (a "Non-Renewing Related Bank"), such Non-Renewing Related Bank
shall, on the fifth Banking Day prior to its then current Parallel Funding Commitment Termination Date, make an advance (a "Cash Secured Advance") to
Borrower in an amount equal to the then available amount of such Related Bank's Available Parallel Funding Commitment by depositing such amount with Administrative Agent. Administrative Agent will
deposit such Cash Secured Advance in a collateral account maintained by Administrative Agent (a "Cash Secured Advance Account") and will invest amounts
on deposit in such Cash Secured Advance Account in Short-term Permitted Investments designated by such Related Bank having a tenor of not more than six Banking Days;  provided that if a Construction
Notice has then been received by Administrative Agent and Construction Loans requested thereunder have not yet been
made, a portion of the amount on deposit in such Cash Secured Advance Account equal
to the Related Bank Construction Loan to be made by such Related Bank shall not be invested beyond the date such Related Bank Construction Loan is to be made. Administrative Agent will deposit funds
received as interest, yield, gain or other amount realized from such Short-term Permitted Investments into such Cash Secured Advance Account. Borrower hereby grants the applicable Related
Bank, as security for all Obligations due and to become due to such Related Bank under the Credit Documents, a security interest in such Cash Secured Advance Account and the proceeds thereof and in
the Short-term Permitted Investments made with the proceeds of a Cash Secured Advance and the proceeds thereof. Promptly upon receipt of a Cash Secured Advance, Borrower and Administrative
Agent will enter into a security and control agreement with the applicable Related Bank in form and substance reasonably satisfactory to each party thereto, confirming the security interest granted
under this Section 2.3.7 and granting a first priority security interest in the applicable Cash Secured Advance Account and the proceeds thereof
for the benefit of such Related Bank. Notwithstanding anything to the contrary contained in this Agreement or any other Credit Document, the security interests described in and granted pursuant to
this Section 2.3.7 shall be permitted exceptions to and excluded from the operation of any provision of this Agreement or any other Credit
Document prohibiting, restricting or limiting in any manner Borrower's right or ability to grant or permit to exist any Lien. 

24

 

        (c)  Each
Cash Secured Advance will bear interest at a rate equal to the interest, yield, gain or other amount realized from the investment of such Cash Secured Advance in
Short-term Permitted Investments to the extent deposited into such Cash Secured Advance Account. Interest will be paid by Administrative Agent to the applicable Related Bank on each Cash
Secured Advance on the second Banking Day of each calendar month to the extent on deposit in such Cash Secured Advance Account and to the extent the amount on deposit in such Cash Secured Advance
Account is then at least equal to the remaining Available Construction Loan Commitment of the applicable Lender Group. 

        (d)  The
making of a Cash Secured Advance and the termination of the applicable Bank's Parallel Funding Commitment will not reduce the Construction Loan Commitment of the
applicable Lender Group or the Construction Loan Commitment Fees in connection therewith, and the applicable Related Bank shall continue to be entitled to receive the Construction Loan Commitment Fees
payable to the applicable Lender Group in accordance with Section 2.4.3. 

        (e)  On
each date that a Construction Loan is to be made by the Lender Group in which the Related Bank has made a Cash Secured Advance pursuant to this  Section 2.3.7, such Related Bank agrees to release
from its Cash Secured Advance Account an amount (its "CSAA Release
Amount") equal to the principal amount of such Construction Loan by delivering such CSAA Release Amount to the applicable Lender Group Agent as required under  Section 2.1.6.
The parties hereto agree that each such release of a CSAA Release Amount by such Related Bank shall be constitute (i) a
prepayment by Borrower to the extent of such amount of the applicable Cash Secured Advance and (ii) the making by such Related Bank of a Related Bank Construction Loan to the extent of such
CSAA Release Amount. 

        (f)    No
reduction in a Lender Group's Construction Loan Commitment shall release or reduce any Cash Secured Advance made by the Related Bank in such Lender Group until after
the Adjustment Date.
On the Banking Day after the Adjustment Date, a portion of the Cash Secured Advance shall be subject to mandatory prepayment and become due and payable in an amount equal to the difference (if any)
between the amount of such Cash Secured Advance then on deposit in the Cash Secured Advance Account minus such Lender Group's Available Construction Loan Commitment as of such date. After the
Adjustment Date, a portion of each Cash Secured Advance shall be subject to mandatory prepayment and become due and payable in an amount equal to any reduction in the applicable Lender Group's
Construction Loan Commitment. Upon any such mandatory prepayment, Administrative Agent shall release from the applicable Cash Secured Advance Account and deliver to the applicable Related Bank the
amount then due and payable as a mandatory prepayment of its Cash Secured Advance, but only to the extent that after such release the amount remaining on deposit in such Cash Secured Advance Account
is then at least equal to the remaining Available Construction Loan Commitment of the applicable Lender Group. 

        (g)  To
the extent not previously prepaid pursuant to Sections 2.3.7(e)and  2.3.7(f), all Cash Secured Advances shall mature and become due and payable in full on
the earliest to occur of (i) any optional or mandatory
prepayment of such Lender Group's Construction Loans in full, (ii) an Event of Default and acceleration of such Lender Group's Construction Loans and (iii) the expiration of the
Construction Loan Availability Period and the termination of such Lender Group's remaining Construction Loan Commitment. On such maturity, Administrative Agent shall release from each Cash Secured
Advance Account and deliver to the applicable Related Bank all amounts then remaining on deposit in such Cash Secured Advance Account. 

25

 

        (h)  Borrower
shall have no liability for the payment of any interest on any Cash Secured Advance or for the prepayment or repayment of any Cash Secured Advance beyond the
amounts then on deposit in the Cash Secured Advance Account in accordance with the provisions of this Section 2.3.7. 

        2.4    Fees.    

        2.4.1    Administrative Agent Fees.    Borrower shall pay to Administrative Agent, solely for its account, the fees
described in the Fee Letter. 

        2.4.2    Arranger Fees.    Borrower shall pay, or cause NEG to pay, to (a) each Arranger, solely for such
Arranger's account, the fees described in the Mandate Letter and the Fee Letter, and (b) the Alternative Funding Arranger, solely for the account of the Alternative Funding Arranger, the fees
described in the Alternative Funding Mandate Letter. 

        2.4.3    Commitment Fees    

        (a)    Construction Loan Commitment Fee.    On each Quarterly Date after the Closing Date and on the last Banking Day
in the Construction Loan Availability Period (or, if all or a portion of the Total Construction Loan Commitment is canceled prior to such date, on the date of such cancellation in accordance with  Section 2.3.6), Borrower shall pay to Administrative Agent, for the benefit of the Banks and the Lender Groups, accruing from the Closing Date or
the first day of the calendar quarter, as the case may be, a commitment fee (the "Construction Loan Commitment Fee") for the calendar quarter (or
portion thereof) then ending equal to the product of (i) the Applicable Fee Rate multiplied by (ii) the daily average Available
Construction Loan Commitment for such quarter (or portion thereof) multiplied by (iii) a fraction, the numerator of which is the number of days
in such quarter (or portion thereof) and the denominator of which is the number of days in that year (365 or 366, as the case may be). Promptly upon receipt of such funds from Borrower, Administrative
Agent shall pay (x) to each Bank, such Bank's Proportionate Share of the Construction Loan Commitment Fee, and (y) to each Lender Group Agent, such Lender Group's Proportionate Share of
the Construction Loan Commitment Fee. Each Lender Group Agent will pay to the Related Bank that is a member of its Lender Group such Lender Group's Proportionate Share of each Construction Loan
Commitment Fee received by such Lender Group Agent pursuant to this Section 2.4.3. 

        (b)    Working Capital/Project LC Commitment Fee.    On each Quarterly Date after the Closing Date and on the last
Banking Day in the Working Capital/LC Availability Period (or, if all or a portion of the Total Working Capital/Project LC Commitment is canceled prior to such date, on the date of such cancellation
in accordance with Section 2.3.6), Borrower shall pay to Administrative Agent, for the benefit of the Banks, accruing from the Closing Date or
the first day of the calendar quarter, as the case may be, a commitment fee (the "Working Capital/Project LC Commitment Fee") for the calendar quarter
(or portion thereof) then ending equal to the product of (i) the Applicable Fee Rate multiplied by (ii) the daily average Available
Working Capital/Project LC Commitment for such quarter (or portion thereof) multiplied by (iii) a fraction, the numerator of which is the number
of days in such quarter (or portion thereof) and the denominator of which is the number of days in that year (365 or 366, as the case may be). 

        (c)    DSR LC Commitment Fee.    On each Quarterly Date after the Closing Date and on the last Banking Day in the
Working Capital/LC Availability Period (or, if all or a portion of the Total DSR LC Commitment is canceled prior to such date, on the date of such cancellation in accordance with  Section 2.3.6),
Borrower shall pay to Administrative Agent, for the benefit of the Banks, accruing from the Closing Date or the first day of the
calendar quarter, as the case may be, a commitment fee (the "DSR LC Commitment Fee") for the 

26

 

calendar quarter (or portion thereof) then ending equal to the product of (i) the Applicable Fee Rate multiplied by (ii) the daily
average Available DSR LC Commitment for such quarter (or portion thereof) multiplied by (iii) a fraction, the numerator of which is the number of
days in such quarter (or portion thereof) and the denominator of which is the number of days in that year (365 or 366, as the case may be). 

        2.4.4    Letter of Credit Fee.    On (a) each Quarterly Date during the period commencing on the date of
issuance of any Letter of Credit and ending on the Expiration Date of such Letter of Credit and (b) the Expiration Date of such Letter of Credit, Borrower shall pay to Administrative Agent, for
the benefit of the Banks, accruing from the date of issuance of such Letter of Credit or from the first day of the
calendar quarter, as the case may be, a letter of credit fee (the "Letter of Credit Fee") for the calendar quarter (or portion thereof) then ending
equal to the product of (i) the daily average Stated Amount of such Letter of Credit for such quarter (or portion thereof) multiplied by
(ii) a fraction, the numerator of which is the number of days in such quarter (or portion thereof) and the denominator of which is 360 multiplied
by (iii) the Applicable Margin. 

        2.4.5    Fronting Fee; LC Administrative Charges.    On (a) each Quarterly Date during the period commencing on
the date of issuance of any Letter of Credit and ending on the Expiration Date of such Letter of Credit and (b) the Expiration Date of such Letter of Credit, Borrower shall pay to
Administrative Agent, solely for the LC Bank's account, the Letter of Credit fronting fees for the calendar quarter (or portion thereof) then ending described in the LC Fee Letter. In addition,
Borrower shall pay the LC Bank's usual and customary charges for the opening of any Letter of Credit, for the negotiation of any drafts paid pursuant to any Letter of Credit and for any wire transfers
made in connection with any Letter of Credit, in each case as described in the LC Fee Letter. 

        2.5    Other Payment Terms.    

        2.5.1    Place and Manner.    Borrower shall make all payments due to any Bank, any Lender Group, the LC Bank or
Administrative Agent hereunder to Administrative Agent, for the account of such Bank, such Lender Group, the LC Bank or Administrative Agent (as the case may be), to
Société Générale, ABA #026-00-4226, for further credit to account #905-14-22 (PG&E);
Reference: GenHoldings I, in Dollars and in immediately available funds and without setoff or counterclaim. 

        2.5.2    Date.    Borrower shall make all payments due to any Bank, any Lender Group, the LC Bank or Administrative
Agent hereunder not later than 12:00 noon on the date on which such payment is due. Any payment made after such time on any day shall be deemed received on the Banking Day after the day on which such
payment is received. Administrative Agent shall disburse to each Bank, each Lender Group Agent or the LC Bank each such payment received by Administrative Agent for such Bank, such Lender Group
Agent's Lender Group or the LC Bank, such disbursement to occur on the day such payment is received if received by 12:00 noon or if such payment is not received by 12:00 noon, on the next Banking Day.
Whenever any payment due hereunder shall fall due on a day other than a Banking Day, such payment shall be made on the next succeeding Banking Day (except in the case of any payment relating to a
LIBOR Loan where such next succeeding Banking Day is in the next calendar month, in which case such payment shall be made on the immediately preceding Banking Day), and such extension of time shall be
included in the computation of interest or fees, as the case may be. 

        2.5.3    Late Payments.    If any amounts required to be paid by Borrower under this Agreement or the other Credit
Documents (including principal or interest payable on any Loan, and any fees or other amounts otherwise payable to Administrative Agent, the LC Bank, any Bank or any Lender Group) remain unpaid after
such amounts are due, Borrower shall pay interest on the aggregate unpaid balance of such amounts from the date due until such amounts are paid in full at a per annum rate equal to the Default Rate. 

27

  

        2.5.4    Net of Taxes, Etc.    

        (a)    Taxes.    Subject to compliance by Administrative Agent, each Bank and each Lender Group Member with  Section 2.5.7, any
and all payments to or for the benefit of Administrative Agent, any Bank or any Lender Group Member made by Borrower hereunder
or under any other Credit Document shall be made free and clear of and without deduction, setoff or counterclaim of any kind whatsoever and in such amounts as may be necessary in order that all such
payments, after deduction for or on account of any present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities imposed with respect thereto (excluding
(x) income and franchise taxes, which include taxes imposed on or measured by the net income or capital of Administrative Agent, such Bank or such Lender Group Member by any jurisdiction or any
political subdivision or taxing authority thereof or therein to the extent resulting from a connection between Administrative Agent, such Bank or such Lender Group Member and such jurisdiction or
political subdivision, other than a connection resulting solely from executing, delivering or performing its obligations or receiving a payment under, or enforcing, this Agreement or any Note, and
(y) any taxes imposed by the United States federal government by means of withholding at the source, other than to the extent such taxes are attributable to a change in law or interpretation
thereof after the date on which Administrative Agent, such Bank or such Lender Group Member became a party to this Agreement (except to the extent such Bank's or such Lender Group Member's assignor
(if any) was entitled, at the time of assignment, to receive additional amounts from Borrower with respect to such taxes pursuant to this  Section 2.5.4(a)) (all such non-excluded taxes, levies,
imposts, deductions, charges, withholdings and liabilities being hereinafter
referred to as "Taxes"), shall be equal to the amounts otherwise specified to be paid to Administrative Agent, such Bank or such Lender Group Member
under this Agreement and the other Credit Documents. If Borrower shall be required by law to withhold or deduct any Taxes from or in respect of any sum payable hereunder or under any other Credit
Document to Administrative Agent, any Bank or any Lender Group Member, (i) the sum payable shall be increased as may be necessary so that after making all required deductions (including
deductions applicable to additional sums payable under this Section 2.5.4), Administrative Agent, such Bank or such Lender Group Member receives
an amount equal to the sum it would have received had no such deductions been made, (ii) Borrower shall make such deductions and (iii) Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with applicable Legal Requirements. In addition, Borrower agrees to pay any present or future stamp, recording or documentary taxes and any
other excise or property taxes, charges or similar levies (not including any income and franchise taxes) that arise under the laws of the United States of America, the State of New York or any other
state or jurisdiction where a Project is located from any payment made hereunder or under any other Credit Document or from the execution or delivery or otherwise with respect to this Agreement or any
other Credit Document (hereinafter referred to as "Other Taxes"). The provisions of this  Section 2.5.4(a) shall not apply to assignments under
Section 9.14.2. 

        (b)    Indemnity.    Borrower shall indemnify Administrative Agent, each Bank and each Lender Group Member both
individually and collectively for the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this  Section 2.5.4 paid by
Administrative Agent, any Bank, any Lender Group Member or any Asset Securitization Company (so long as such Asset Securitization Company is of the type of entity described in clause (a) of the
first sentence of Section 2.5.7), or any liability (including penalties, interest and reasonable expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted; provided that Borrower shall not be obligated to indemnify
Administrative Agent, any Bank or any Lender Group Member for any penalties, interest or expenses relating to Taxes or Other 

28

 

Taxes arising from the indemnitee's gross negligence or willful misconduct. Administrative Agent, each Bank and each Lender Group Member agree to give written notice to Borrower of the assertion of
any claim against Administrative Agent, such Bank or such Lender Group Member relating to such Taxes or Other Taxes as promptly as is practicable after being notified of such assertion, and in no
event later than 90 days after Administrative Agent, such Bank or such Lender Group Member received written notice of the imposition of such Taxes by the relevant taxing or Governmental
Authority (except in the case where the ultimate amount of the Taxes could not be determined within such 90-day period); provided that the
failure of Administrative Agent, any Bank or any Lender Group Member to notify Borrower of such assertion within such 90 days period shall not relieve Borrower of its obligation under this  Section 2.5.4 with respect to Taxes or Other Taxes arising prior to the end of such period, but shall relieve Borrower of its obligations under
this Section 2.5.4 with respect to penalties and interest relating to such Taxes or Other Taxes between the end of such period and such time as
Borrower receives notice from Administrative Agent, such Bank or such Lender Group Member as provided herein. Payments by Borrower pursuant to this indemnification shall be made within 30 days
from the date Administrative Agent, such Bank (through Administrative Agent), such Lender Group Agent or such other Lender Group Member (through its Lender Group Agent) makes written demand therefor,
which demand shall be accompanied by a certificate describing in reasonable detail the basis thereof. 

        (c)    Notice.    Within 30 days after the date of any payment of Taxes by Borrower, Borrower shall furnish to
Administrative Agent, at its address referred to in Section 11.1, the original or a certified copy of a receipt (or, if such original receipt or
its copy is not available, any other evidence of payment reasonably satisfactory to Administrative Agent) evidencing payment thereof. Borrower shall compensate each Bank and each Lender Group Member
for all reasonable losses and expenses sustained by such Bank or such Lender Group Member as a result of any failure by Borrower to so furnish such original or copy of such receipt or such other
evidence of payment. 

        (d)    Tax Refunds.    If Administrative Agent, any Bank or any Lender Group Member receives any refund of any Tax or
Other Tax from the jurisdiction imposing such tax, to the extent that such refund in the sole reasonable judgment of such Person is allocable to a payment by Borrower made under this  Section 2.5.4,
the amount of such refund, net of all out-of-pocket or other expenses (including any taxes on a refund or
on interest received or credited) such Person reasonably determines to have been incurred in connection with obtaining such refund, shall be paid over to Borrower;  provided, however, that Borrower, upon the request of such Person, agrees to repay the amount paid over
to Borrower (plus penalties, interest and other charges) to such Person in the event such Person is required to repay such refund with respect to which a payment was made by such Person to Borrower
pursuant to this clause (d). Notwithstanding anything to the contrary in this Section 2.5.4, such Person shall have no obligation to
cooperate with respect to any contest (or continue to cooperate with respect to any contest), or seek or claim any refund, if such Person reasonably determines that its interests would be adversely
affected by so cooperating (or continuing to cooperate) or by seeking or claiming any such refund. 

        (e)    Survival of Obligations.    The obligations of Borrower under this  Section 2.5.4 shall survive the termination of this
Agreement and the repayment of the Obligations. 

        (f)    Recovery by Lender Group.    Notwithstanding anything to the contrary in this  Section 2.5.4, no Lender Group, together
with any Asset Securitization Company providing funding to the CP Conduit that is a member of such
Lender Group (taken as a whole), shall receive any greater amount under this Section 2.5.4 than it would have received had it been a Bank. 

29

 

        2.5.5    Application of Payments.    Except as otherwise expressly set forth herein or in the other Credit Documents
(including Article IV of the Depositary Agreement), all payments made under this Agreement or the other Credit Documents and other amounts
received by Administrative Agent, the Banks and the Lender Groups under this Agreement or the other Credit Documents shall be applied as follows: 

        (a)  first, to any fees, costs, charges or expenses payable to Administrative Agent, the Arrangers, the LC Bank, the Banks and
the Lender Groups hereunder or under the other Credit Documents (such application to be made on a pro rata basis among such Persons), 

        (b)  second, to any accrued but unpaid interest then due and owing in respect of the Obligations, and 

        (c)  third, to outstanding principal then due and owing or otherwise to be prepaid in respect of the Obligations. 

        2.5.6    Failure to Pay Administrative Agent.    Unless Administrative Agent shall have received notice from Borrower
at least two Banking Days prior to the date on which any payment is due to any Bank or any Lender Group Member hereunder that Borrower will not make such payment in full, Administrative Agent may
assume that Borrower has made such payment in full to Administrative Agent on such date and Administrative Agent may, in reliance upon such assumption, cause to be distributed to each Bank and to each
Lender Group Agent for the benefit of its respective Lender Group on such due date an amount equal to the amount then due to such Bank or such Lender Group. If and to the extent Borrower shall not
have so made such payment in full to Administrative Agent, each Bank and each Lender Group Agent on behalf of its Lender Group shall repay to Administrative Agent forthwith upon demand such amount
distributed to such Bank or to such Lender Group, together with interest thereon, for each day from the date such amount is distributed to such Bank or to such Lender Group until the date such Bank or
such Lender Group Agent on behalf of its Lender Group repays such amount to Administrative Agent, at the Federal Funds Rate for the first five days after such date, and
subsequent thereto at the Default Rate. A certificate of Administrative Agent submitted to any Bank or to any Lender Group with respect to any amounts owing by such Bank or such Lender Group under
this Section 2.5.6 shall be conclusive in the absence of demonstrable error. If any such amount is to be returned by a Lender Group, the Related
Bank or CP Conduit that is a member of such Lender Group and that received such amount shall be obligated to return such amount to Administrative Agent on behalf of such Lender Group. 

        2.5.7    Withholding Exemption Certificates.    Each of Administrative Agent and each Bank and Lender Group Member
(upon becoming a Bank or Lender Group Member hereunder) and any Person to which Administrative Agent or any Bank or Lender Group Member grants a participation (or otherwise transfers its interest in
this Agreement) agrees that on the date Administrative Agent or such Bank, Lender Group Member or Person becomes a party to this Agreement it will deliver to each of Borrower and Administrative Agent
either (a) if Administrative Agent or such Bank, Lender Group Member or Person is (i) a corporation established under the laws of the United States or any political subdivision thereof
or (ii) in the case of a CP Conduit, either (A) a "domestic partnership" within the meaning of Code Section 7701(a)(30)(B), or (B) "disregarded as an entity" within the
meaning of Treasury Regulation Section 301.7701-3 and is wholly-owned by a corporation established under the laws of the United States of any political subdivision thereof, a duly
and appropriately completed copy of a United States Internal Revenue Service Form W-9 or any successor applicable form, or (b) if Administrative Agent or such Bank, Lender
Group Member or Person, or a CP Conduit is not a corporation described in (a)(i) above or a "domestic partnership" or "disregarded entity" described in (a)(ii)(A) and (B) above,
(i) a duly completed and executed exemption certificate in the form of 

30

 

 Exhibit J hereto and a duly and appropriately completed copy of United States Internal Revenue Service Form W-8BEN (claiming an exemption under the
so-called portfolio interest exemption), or (ii) a duly and appropriately completed copy of United States Internal Revenue Service Form W-8ECI or W-8
BEN or successor applicable form, as the case may be (claiming therein a reduction in, or an exemption from, United States withholding taxes under an applicable treaty or as income effectively
connected with the conduct of trade or business within the United States), and if reasonably requested by Borrower or Administrative Agent, any additional statements and forms so requested from time
to time. Administrative Agent and each Bank, Lender Group Member or other Person which delivers to Borrower and Administrative Agent a Form W-9, W-8ECI or
W-8BEN or other form or certificate pursuant to the preceding sentence further undertakes to deliver to Borrower and Administrative Agent further copies of the Form W-9,
W-8ECI or W-8BEN, or successor applicable form or other form or certificate, or other manner of certification or procedure, as the case may be, on or before the date that any
such form or certificate expires or becomes obsolete or within a reasonable time (not to exceed 90 days) after gaining knowledge of the occurrence of any event requiring a change in the most
recent forms or certificates previously delivered by it to Borrower and Administrative Agent, and such extensions or renewals thereof as may reasonably be requested by Borrower or Administrative
Agent, certifying in the case of a Form W-9, W-8ECI or W-8BEN that such Bank, Lender Group Member or Person is entitled to receive payments under this
Agreement without (or with a reduced amount of) deduction or withholding of any United States federal income taxes, unless in any such cases an event (including any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would otherwise be required which renders all such forms inapplicable or which would prevent a Bank or Lender Group Member from
duly completing and delivering any such form with respect to it. Borrower shall not be obligated to pay any additional amounts in respect of United States Federal income tax pursuant to  Section 2.5.4 (or make an indemnification payment pursuant to Section 2.5.4) to any Bank,
Lender Group Member or other Person (including any Person to which any Bank or Lender Group Member sells, assigns, grants a participation in, or otherwise transfers, its rights under this Agreement)
to the extent the obligation to pay such additional amounts (or such indemnification)
would not have arisen but for a failure of such Bank, Lender Group Member or Person to comply with its obligations under this Section 2.5.7
(except to the extent such failure was caused by a change in law or interpretation thereof after the date of such Person becoming a party to this Agreement,  provided, however, that the foregoing change in law exception shall not affect Borrower's obligation to
pay additional amounts to the extent such Bank's or Lender Group Member's assignor (if any) was entitled, at the time of assignment, to receive additional amounts from Borrower); and, for the
avoidance of doubt, Borrower has no obligations under Section 2.5.4 or otherwise to Persons that are not a party to this Agreement (including any
participant). Notwithstanding the foregoing or anything else to the contrary in this Agreement, no Bank, Lender Group Member or other Person shall be obligated to deliver any form, certificate or
document which it cannot deliver as a matter of law. Each Asset Securitization Company shall be required to provide the applicable certificates and other documents described in this  Section 2.5.7
to the same extent as its CP Conduit. 

        2.6    Pro Rata Treatment.    

        2.6.1    Loans, Commitment Reductions, Etc.    Except as otherwise provided herein, (a) each Borrowing and each
reduction of a Commitment shall be made or allocated among the Banks and the Lender Groups pro rata according to their respective Proportionate Shares
of such Borrowing or Commitment, as the case may be, (b) each payment of principal of Construction Loans shall be made or shared among Banks and Lender Groups holding such Construction Loans  pro rata according to the respective unpaid principal amounts of such Construction Loans held by such Banks and such Lender Groups, (c) each
payment of interest on Construction Loans shall be allocated to the Banks and Lender Groups funding the Construction Loans with respect to which 

31

 

such interest was paid, provided that if such payment is not sufficient to pay all interest then due and payable with respect to Construction Loans,
such payment of interest shall be shared among the Banks and Lender Groups funding the Construction Loans with respect to which such interest is then due and payable pro
rata according to the principal amount of such Construction Loans, (d) each payment of principal of and interest on Loans other than Construction Loans shall be made or
shared among Banks holding such Loans pro rata according to the respective unpaid principal amounts of such Loans held by such Banks, (e) each
payment of Commitment Fees shall be shared among the Banks and the Lender Groups pro rata according to their respective Proportionate Shares of the
Commitments to which such fees apply, and (f) each payment of Letter of Credit Fees shall be shared among the Banks pro rata according to their
respective Proportionate Shares of the Stated Amount of the Letter of Credit to which such fees apply. 

        2.6.2    Sharing of Payments, Etc.    If any Bank or Lender Group shall obtain any payment (whether voluntary,
involuntary, through the exercise of any right of setoff or otherwise) on account of Loans owed to it in excess of its ratable share of payments on account of such Loans obtained by all Banks and
Lender Groups entitled to such payments, such Banks and Lender Groups shall forthwith purchase from the other Banks and Lender Groups such participation in the Loans, as the case may be, as shall be
necessary to cause such purchasing Bank or Lender Group to share the excess payment ratably with each of the other Banks and Lender Groups; provided,  however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Bank or Lender Group, such purchase by such Bank
or Lender Group shall be rescinded and each other Bank and Lender Group shall repay to the purchasing Bank or Lender Group the purchase price to the extent of such recovery together with an amount
equal to such other Bank's or Lender Group's ratable share (according to the proportion of
(a) the amount of such other Bank's or Lender Group's required repayment to (b) the total amount so recovered from the purchasing Bank or Lender Group) of any interest or other amount
paid or payable by the purchasing Bank or Lender Group in respect of the total amount so recovered. Borrower agrees that any Bank or Lender Group so purchasing a participation from another Bank or
Lender Group pursuant to this Section 2.6.2 may, to the fullest extent permitted by law, exercise all its rights of payment (including the right
of setoff) with respect to such participation as fully as if such Bank or Lender Group were the direct creditor of Borrower in the amount of such participation. This  Section 2.6.2. shall not apply
to any Cash Secured Advance Account. 

        2.6.3    Payments to Lender Groups.    Each payment of principal to a Lender Group with respect to Construction Loans
made by such Lender Group shall be made or shared among the CP Conduit and Related Bank in such Lender Group pro rata according to the principal amount
of such Construction Loans funded by such CP Conduit and such Related Bank, unless otherwise agreed by such CP Conduit and such Related Bank and advised to Administrative Agent. Each payment of
interest to a Lender Group with respect to Construction Loans made by such Lender Group shall be allocated to the CP Conduit and to the Related Bank funding the Construction Loans with respect to
which such interest was paid, provided that if such payment is not sufficient to pay all interest then due and payable with respect to Construction
Loans made by such Lender Group, such payment of interest shall be shared among the CP Conduit and Related Bank in such Lender Group funding the Construction Loans with respect to which such interest
is then due and payable pro rata according to the principal amount of such Construction Loans. 

        2.7    Change of Circumstances.    

        2.7.1    Inability to Determine Rates.    If, on or before the first day of any Interest Period for any LIBOR Loans,
(a) Administrative Agent determines (which determination shall be conclusive absent manifest error) that the LIBO Rate for such Interest Period cannot be adequately and reasonably determined
due to the unavailability of funds in or other circumstances affecting the London interbank market, or (b) Banks and Lender Groups holding aggregate Proportionate 

32

 

Shares of 331/3% or more of the Commitment under which such LIBOR Loans (other than CP Conduit Funded LIBOR Construction Loans) are being made shall advise Administrative Agent that
(i) the rates of interest for such LIBOR Loans do not adequately and fairly reflect the cost to such Banks or the Related Banks in such Lender Groups of making or maintaining such Loans or
(ii) deposits in Dollars in the London interbank market are not available to such Banks or Related Banks (as conclusively certified by each such Bank or Related Bank in good faith in writing to
Administrative Agent and to Borrower) in the ordinary course of business in sufficient amounts to make and/or maintain such LIBOR Loans, Administrative Agent shall immediately give notice of such
condition to Borrower, the Banks and the Lender Group Agents on behalf of their respective Lender Groups by telephone or facsimile. After the giving of any such notice and until Administrative Agent
shall otherwise notify Borrower, the Banks and the Lender Group Agents on behalf of their respective Lender Groups that the circumstances giving rise to such condition no longer exist, Borrower's
right to request the making of or conversion to, and the obligations of each Bank and each Lender Group to make or convert to, LIBOR Loans shall be suspended. Any LIBOR Loans outstanding at the
commencement of any such suspension shall be converted at the end of the then current Interest Period for such Loans into Base Rate Loans unless such suspension has ended. 

        2.7.2    Illegality.    If, after the date of this Agreement, the adoption of any Governmental Rule, any change in any
Governmental Rule or the application or requirements thereof (whether such change occurs in accordance with the terms of such Governmental Rule as enacted, as a result of amendment, or otherwise), any
change in the interpretation or administration of any Governmental Rule by any Governmental Authority, or compliance by any Bank or Related Bank or by Borrower with any request or directive (whether
or not having the force of law) of any Governmental Authority (a "Change of Law") shall make it unlawful or impossible for any Bank or Related Bank to
make or maintain any LIBOR Loan, such Bank or Related Bank shall immediately notify Administrative Agent and Borrower of such Change of Law. Upon receipt of such notice, (a) Borrower's right to
request the making of or conversion to, and such Bank's and such Related Bank's obligation to make or convert to, LIBOR Loans shall be suspended for so long as such condition shall exist, and
(b) Borrower shall, at the request of such Bank or Related Bank, either (i) pursuant to Section 2.1.7, convert any then outstanding
LIBOR Loans (other than CP Conduit Funded LIBOR Construction Loans) into Base Rate Loans at the end of the current Interest Periods for such Loans, or, with respect to CP Conduit Funded LIBOR
Construction Loans, notify each applicable Lender Group Agent that such CP Conduit Funded LIBOR Construction Loans shall be converted into Base Rate Construction Loans at the end of the current
Interest Periods, or (ii) if such Bank or Related Bank shall notify Borrower that such Bank or Related Bank may not lawfully continue to fund and maintain such Loans, immediately repay such
Loans pursuant to Section 2.1.8 or convert such Loans into Base Rate Loans. Any conversion or prepayment of LIBOR Loans made pursuant to the
preceding sentence prior to the last day of an Interest Period for such Loans shall be deemed a prepayment thereof for purposes of Section 2.8. 

        2.7.3    Increased Costs.    If, after the date of this Agreement, any Change of Law: 

        (a)  Shall
subject any Bank or any Lender Group Member to any tax, duty or other charge with respect to any LIBOR Loan or Commitment, or shall change the basis of taxation of
payments by Borrower to any Bank or any Lender Group Member on any LIBOR Loan or with respect to any Commitment (except for Taxes, Other Taxes or changes in the rate of taxation on the overall net
income of any Bank or Lender Group Member); or 

        (b)  Shall
impose, modify or hold applicable any reserve, special deposit or similar requirement (without duplication of any reserve requirement included within the
applicable interest rate through the definition of "Reserve Requirement") against assets held by, deposits 

33

 

or other liabilities in or for the account of, advances or loans by, or any other acquisition of funds by any Bank or any Lender Group Member for any LIBOR Loan; or 

        (c)  Shall
impose on any Bank or any Lender Group Member any other condition directly related to any LIBOR Loan or Commitment; 

and
the effect of any of the foregoing is to increase the cost to such Bank or such Lender Group Member of making, issuing, creating, renewing, participating in (subject to the limitations in  Section 9.13) or maintaining any such LIBOR Loan or Commitment or to reduce any amount receivable by or on behalf of such Bank or such Lender
Group Member hereunder, then Borrower shall from time to time, upon demand by such Bank or such Lender Group Member, pay to such Bank or such Lender Group Member additional amounts sufficient to
reimburse such Bank or such Lender Group Member for such increased costs or to compensate such Bank or such Lender Group Member for such reduced amounts. A certificate setting forth in reasonable
detail the amount of such increased costs or reduced amounts and the basis for determination of such amount, submitted by such Bank or such Lender Group Member to Borrower, shall, in the absence of
manifest error, be conclusive and binding on Borrower for purposes of this Agreement. Notwithstanding anything to the contrary in this  Section 2.7.3, no Lender Group (taken as a whole), shall
receive any greater amount with respect to such increased costs or such reduced amounts
than it would have received had it been a Bank. 

        2.7.4    Capital Requirements.    If any Bank or any Lender Group Member determines that (a) any Change of Law
after the date of this Agreement increases the amount of capital required or expected to be maintained by such Bank or such Lender Group Member (or the Lending Office of such Bank or such Lender Group
Member) or any Person controlling such Bank or such Lender Group Member (a "Capital Adequacy Requirement") and (b) the amount of capital
maintained by such Bank, such Lender Group Member or such Person which is attributable to or based upon the Loans, the Commitments or this Agreement must be increased as a result of such Capital
Adequacy Requirement (taking into account the policies of such Bank, such Lender Group Member or such Person with respect to capital adequacy), Borrower shall pay to Administrative Agent on behalf of
such Bank, such Lender Group Member or such Person, upon demand of Administrative Agent on behalf of such Bank, such Lender Group Member or such Person, such amounts as such Bank, such Lender Group
Member or such Person shall reasonably determine are necessary to compensate such Bank, such Lender Group Member or such Person for the increased costs to such Bank, such Lender Group Member or such
Person of such increased capital. A certificate of such Bank, such Lender Group Member or such Person, setting forth in reasonable detail the computation of any such increased costs, delivered to
Borrower by Administrative Agent on behalf of such Bank, such Lender Group Member or such Person shall, in the absence of manifest error, be conclusive and binding on Borrower for purposes of this
Agreement. Notwithstanding anything to the contrary in this Section 2.7.4, no Lender Group (taken as a whole), shall receive any greater amount
with respect to such increased costs than it would have received had it been a Bank. 

        2.7.5    Notice; Participating Banks' and Lender Group Members' Rights.    Each applicable Bank or applicable Lender
Group Member will notify Borrower of any event occurring after the date of this Agreement that will entitle such Bank or such Lender Group Member to compensation pursuant to this  Section 2.7, as
promptly as practicable, and in no event later than 180 days after the principal officer of such Bank or such Lender Group
Member responsible for administering this Agreement obtains knowledge thereof; provided that any failure of any such Bank or such Lender Group Member to
notify Borrower within such 180 day period shall not relieve Borrower of its obligation under this Section 2.7 with respect to claims
arising prior to the end of such period, but shall relieve Borrower of its obligations under this Section 2.7 with respect to the time between
the end of such period and such time as Borrower receives notice from the indemnitee as 

34

 

provided herein. No Person purchasing from a Bank a participation in any Commitment (as opposed to an assignment) shall be entitled to any payment from or on behalf of Borrower pursuant to  Section 2.7.3 or 2.7.4 which would be in excess of the applicable proportionate amount (based on
the portion of the Commitment in which such Person is participating) which would then be payable to such Bank if such Bank had not sold a participation in that portion of such Commitment. No Person
purchasing from a Related Bank a participation in any Parallel Funding Commitment (as opposed to an assignment) shall be entitled to any payment from or on behalf of Borrower pursuant to  Section 2.7.3 or 2.7.4 which would be in excess of the applicable proportionate amount (based on
the portion of the Parallel Funding Commitment in which such Person is participating) which would then be payable to such Related Bank if such Related Bank had not sold a participation in that portion
of such Parallel Funding Commitment. 

        2.8    Funding Losses.    If Borrower shall (a) repay or prepay any LIBOR Loans on any day other than the last
day of an Interest Period for such Loans (whether an Optional Prepayment or a Mandatory Prepayment), (b) fail to borrow any LIBOR Loans in accordance with a Notice of Borrowing delivered to
Administrative Agent (whether as a result of the failure to satisfy any applicable conditions or otherwise), (c) fail to convert any Loans into LIBOR Loans in accordance with a Notice of
Conversion of Loan Type delivered to Administrative Agent (whether as a result of the failure to satisfy any applicable conditions or otherwise), (d) fail to continue a LIBOR Loan in accordance
with a Confirmation of Interest Period Selection delivered to Administrative Agent or (e) fail to make any prepayment in accordance with any notice of prepayment delivered to Administrative
Agent, Borrower shall, upon demand by any Bank or any Lender Group Member, reimburse such Bank or such Lender Group Member for all costs and losses incurred by such Bank or such Lender Group Member as
a result of such repayment, prepayment or failure ("Liquidation Costs"). Borrower understands that such costs and losses may include losses incurred by
a Bank or a Lender Group Member as a result of funding and other contracts entered into by such Bank or such Lender Group Member to fund LIBOR Loans. Each Bank and each Lender Group Member demanding
payment under this Section 2.8 shall deliver to Borrower a certificate setting forth in reasonable detail the basis for and the amount of costs
and losses for which demand is made. Any such certificate delivered to Borrower shall, in the absence of manifest error, be conclusive and binding on Borrower for purposes of this Agreement. For
purposes of this Section 2.8, with respect to each LIBOR Loan that is or is to be a CP Conduit Funded LIBOR Construction Loan, each Lender Group
Member shall be deemed to have costs and losses equal to costs and losses that would have been incurred by such Lender Group Member had it been a Bank. 

        2.9    Alternate Office; Minimization of Costs.    

        2.9.1    To
the extent reasonably possible, each Bank and each Related Bank shall designate an alternative Lending Office with respect to its LIBOR Loans and otherwise take any
reasonable actions to reduce any liability of Borrower to any Bank or any Related Bank under Section 2.5.4,  2.7.3 or 2.7.4, or to avoid the unavailability of any Type of Loans under  Section 2.7.2 so long as such Bank or such Related Bank, in its sole discretion, determines that
(a) such designation is not
disadvantageous to such Bank or such Related Bank and (b) solely with respect to liabilities under Section 2.7.3 or  2.7.4, that such actions
would eliminate or reduce any such liability. Borrower hereby agrees to pay all reasonable costs and expenses incurred by any
such Bank or such Related Bank in connection with any such designation or actions. Each CP Conduit shall at all times maintain a Lending Office located in the United States with respect to its LIBOR
Loans. 

        2.9.2    If
and with respect to each occasion that a Bank or a Lender Group Member either makes a demand for compensation pursuant to  Section 2.5.4, 2.7.3 or
2.7.4 or is unable to
fund LIBOR Loans pursuant to Section 2.7.2 or such Bank or such Lender Group Member wrongfully fails to fund a Loan, Borrower may, upon at least
five Banking Days' prior irrevocable written notice to such Bank and Administrative Agent or such Lender Group Member and the applicable Lender Group Agent, as the case may be, in whole permanently
replace the Commitments of such Bank or the applicable Lender Group; provided that Borrower shall replace such Commitments with the Commitments of a
commercial bank reasonably satisfactory to Administrative Agent, and 

35

 

with respect to the Working Capital/Project LC Commitment and the DSR LC Commitment, Borrower shall replace such Commitments with the Commitments of a Bank that is rated at least Baa3 by Moody's and
at least BBB- by S&P. Such replacement Bank shall upon the effective date of replacement purchase the Obligations owed to such replaced Bank for the aggregate amount thereof and shall
thereupon for all purposes become a "Bank" hereunder. Such notice from Borrower shall specify an effective date for the replacement of such Bank's or such Lender Group's Commitments, which date shall
not be later than the tenth day after the day such notice is given. On the effective date of any replacement of such Bank's or such Lender Group's Commitments pursuant to this  Section 2.9.2,
Borrower shall pay to Administrative Agent for the account of such Bank or such Lender Group (a) any fees due to such Bank
or such Lender Group to the date of such replacement, (b) the principal of and accrued interest on the principal amount of outstanding Loans and Reimbursement Obligations held by such Bank and
on outstanding Construction Loans held by such Lender Group to the date of such replacement, (c) the amount or amounts requested by such Bank or such Lender Group Member in such Lender Group
pursuant to each of Sections 2.5.4, 2.7.3 and 2.7.4, as
applicable, and (d) any other amount then payable hereunder to such Bank or such Lender Group. Borrower will remain liable to such replaced Bank or such replaced Lender Group (or any member
thereof) for any Liquidation Costs that such Bank or such Lender Group (or any member thereof) may sustain or incur as a consequence of repayment of its Loans (unless such Bank or such Lender Group
has defaulted on its obligation to fund a Loan hereunder). Upon the effective date of purchase of any Bank's Loans and Reimbursement Obligations and termination of such Bank's Commitments pursuant to
this Section 2.9.2, such Bank shall cease to be a Bank hereunder, and upon the effective date of purchase of any Lender Group's Construction
Loans and termination of such Lender Group's Construction Loan Commitment pursuant to this Section 2.9.2, such Lender Group shall cease to be a
Lender Group hereunder. No such termination of any such Bank's Commitments and the purchase of such Bank's Loans and Reimbursement Obligations pursuant to this  Section 2.9.2 shall affect
(i) any liability or obligation of Borrower or any other Bank or Lender Group to such terminated Bank which
accrued on or prior to the date of such termination or (ii) such terminated Bank's rights hereunder in respect of any such liability or obligation. No such termination of such Lender Group's
Construction Loan Commitment and the purchase of such Lender Group's Construction Loans pursuant to this Section 2.9.2 shall affect
(i) any liability or obligation of Borrower or any Bank or Lender Group to such terminated Lender Group which accrued on or prior to the date of such termination or (ii) the rights of
such terminated Lender Group (or any member thereof) hereunder in respect of any such liability or obligation. 

        2.9.3    Upon
written notice to Administrative Agent and Borrower, any Bank or Lender Group Member may designate a Lending Office other than that set forth in  Exhibit I hereto (which Exhibit shall be
automatically amended without further action to give effect to such designation on the date
Administrative Agent receives such notice) and may assign all of its interests under the Credit Documents to such Lending Office; provided that such
designation and assignment do not at the time of such designation and assignment increase the reasonably foreseeable liability of Borrower to such Bank or Lender Group Member under  Section 2.5.4,
2.7.3, or 2.7.4 or make an
interest rate option unavailable pursuant to Section 2.7.2. 

ARTICLE 3.
  CONDITIONS PRECEDENT  

        3.1    Conditions Precedent to the Closing Date.    The effectiveness of this Agreement, the obligations of
Administrative Agent hereunder and the obligations of each Bank and each Lender Group hereunder shall be subject to the fulfillment (or written waiver by Administrative Agent with the 

36

 

consent of each of the Banks and each of the Lender Groups) of each of the following conditions precedent: 

        3.1.1    Resolutions.    Delivery to Administrative Agent of a copy of one or more resolutions or other
authorizations, in form and substance reasonably satisfactory to each of the Banks and each of the Lender Groups, of the board of directors or other similar governing body of each of Borrower and NEG,
authorizing, as applicable, the Borrowings herein provided for and the execution, delivery and performance of this Agreement, the other Operative Documents and any instruments or agreements required
hereunder or thereunder to which such Person is a party, certified by the appropriate Responsible Officer of each such Person as being in full force and effect on the Closing Date. 

        3.1.2    Incumbency.    Delivery to Administrative Agent of a certificate, in form and substance reasonably
satisfactory to each of the Banks and each of the Lender Groups, from each of Borrower and NEG, signed by the appropriate Responsible Officer of each such Person and dated the Closing Date, as to the
incumbency of the natural Persons authorized to execute and deliver this Agreement and the other Operative Documents and any instruments or agreements required hereunder or thereunder to which such
Person is a party. 

        3.1.3    Formation Documents.    Delivery to Administrative Agent of (a) copies of the certificate of
formation, articles of incorporation or other state certified constituent documents of each of Borrower and NEG, certified by the secretary of state of the state of such Person's formation or
incorporation, and (b) copies of the limited liability company operating agreement, bylaws or other comparable constituent documents of each of Borrower and NEG, certified by the appropriate
Responsible Officer of each such Person as being true, correct and complete on the Closing Date. 

        3.1.4    Good Standing Certificates.    Delivery to Administrative Agent of certificates issued by the secretary of
state of the state in which each of Borrower and NEG is formed or incorporated, together with certificates issued by the secretary of state in each other jurisdiction where either such Person is
qualified to do business, in each case (a) dated no more than five days prior to the Closing Date and (b) certifying that such Person is in good standing and is qualified to do business
in, and has paid all franchise taxes or similar taxes due to, such states. 

        3.1.5    Credit Documents.    Delivery to Administrative Agent of a true, correct and complete original of each of the
following documents: 

        (a)  this
Agreement; 

        (b)  each
applicable Note; 

        (c)  the
Borrower Security Agreement; 

        (d)  the
Depositary Agreement; and 

        (e)  the
NEG Equity Guaranty. 

Each
Credit Document specified above shall be in form and substance reasonably satisfactory to each of the Banks and each of the Lender Groups and shall have been duly authorized, executed and
delivered by the parties thereto. 

        3.1.6    UCC Reports.    Delivery to Administrative Agent of a UCC report dated as of a date no more than five Banking
Days before the Closing Date for each of the jurisdictions in which UCC-1 financing statements are intended to be filed in respect of the Borrower Collateral, confirming that upon due
filing (assuming such filing occurred on the date of such respective reports) the security interests created under the Borrower Collateral Documents will be prior to all other financing statements or
other security documents wherein the security interest is perfected by filing in respect of the Borrower Collateral, other than financing statements or other security 

37

 

documents evidencing security interests that will be released and/or discharged on or prior to the Closing Date. 

        3.1.7    UCC Filings.    Each of the documents and instruments set forth in Part I of  Exhibit D-5 hereto shall have been
(a) delivered to Administrative Agent for recording or filing or (b) recorded or
filed in the respective places or offices set forth in Part I of Exhibit D-5 hereto and, in each such case, any and all taxes,
recording and filing fees with respect thereto shall have been paid (or, as approved by each of the Banks and each of the Lender Groups, provided for), and each of the other actions set forth in
Part I of Exhibit D-5 hereto shall have been taken. 

        3.1.8    Closing Certificates of Borrower and NEG.    Delivery to Administrative Agent of (a) a certificate,
dated as of the Closing Date, duly executed by a Responsible Officer of Borrower, in substantially the form of Exhibit F-1A hereto,
and (b) a certificate, dated as of the Closing Date, duly executed by a Responsible Officer of NEG, in substantially the form of  Exhibit F-1B. 

        3.1.9    Legal Opinions.    Delivery to Administrative Agent of legal opinions of counsel to Borrower and NEG, in each
case in form and substance reasonably satisfactory to each of the Banks and each of the Lender Groups. 

        3.1.10    Preliminary Project Budgets.    Delivery to Administrative Agent of a preliminary project budget for each
Project that will not be an Approved Project as of the Closing Date, showing all anticipated Project Costs to be incurred for such Project, including all construction and non-construction
costs, all interest, taxes and other carrying costs, all non-allocated costs of Borrower or the applicable Project Company, and such other information as the Banks may require, together
with a balanced statement of sources (including an allocation between Loan proceeds and Committed Equity Contributions) and uses of proceeds (and any other funds necessary to complete each such
Project), broken down as to separate construction phases and components, which preliminary project budget shall be in form and substance reasonably satisfactory to each of the Banks and each of the
Lender Groups and will be attached as Exhibit G-2 hereto. 

        3.1.11    Preliminary Project Schedules.    Delivery to Administrative Agent of a preliminary schedule for
construction and completion of each Project that will not be an Approved Project as of the Closing Date, which schedule shall be in form and substance reasonably satisfactory to each of the Banks and
each of the Lender Groups and will be attached as Exhibit G-2 hereto. 

        3.1.12    Base Case Project Projections.    Delivery to Administrative Agent of (a) Base Case Project
Projections for each of the Projects (taken individually), (b) Base Case Project Projections for all of the Projects (taken as a whole), showing minimum and average annual projected Debt
Service Coverage Ratios over the period set forth in the Base Case Project Projections of no less than 2.0 to 1.0 and 3.0 to 1.0, respectively, and (c) the calculation of the Debt to
Capitalization Ratio necessary to achieve the Debt Service Coverage Ratios described in clause (b) immediately above, which shall not be greater than 0.60 to 1.0, each of which shall be in form
and substance reasonably satisfactory to each of the Banks and each of the Lender Groups and will be attached as Exhibit G-2 hereto. 

        3.1.13    Financial Statements.    Delivery to Administrative Agent of true, correct and complete copies of
(a) audited financial statements of NEG for the fiscal year ending December 31, 2000, conforming to the requirements set forth in  Section 5.3(b), and (b) unaudited financial
statements of NEG and Borrower as at September 30, 2001, conforming to the requirements
set forth in Section 5.3(a), in each case in form and substance reasonably satisfactory to each of the Banks and each of the Lender Groups,
together with a certificate from the appropriate Responsible Officer of the applicable Person, stating that such financial statements have been prepared in conformity with GAAP and fairly present, in
all material respects, the financial position (on a consolidated and, where applicable, consolidating basis) of such
Person described in such financial statements as at the respective dates thereof and the results of operations and cash flows (on a consolidated and, 

38

 

where applicable, consolidating basis) of such Person described therein for each of the periods then ended, subject, in the case of any such unaudited financial statements, to changes resulting from
audit and normal year-end adjustments. 

        3.1.14    Establishment of Accounts.    The Accounts shall have been established to the reasonable satisfaction of
each of the Banks and each of the Lender Groups. 

        3.1.15    Payment of Bank and Consultant Fees.    Borrower shall have paid or caused NEG to have paid, as the case may
be, all outstanding amounts due and owing to (i) the Banks, the Lender Groups, the LC Bank, Administrative Agent, the Depositary Agent and the Arrangers under the Mandate Letter, the
Alternative Funding Mandate Letter, the Fee Letter, the Depositary Agent Fee Letter and the LC Fee Letter, or pursuant to Section 2.4, and
(ii) the Banks' and Lender Groups' attorneys and consultants (including the Independent Consultants), for all services rendered and billed prior to the Closing Date. 

        3.1.16    Independent Engineer's Final Draft Report and Certificate.    Delivery to Administrative Agent of a final
draft Independent Engineer's report with respect to each Project that will not be an Approved Project as of the Closing Date, in form and substance reasonably satisfactory to each of the Banks and
each of the Lender Groups, together with a certificate of the Independent Engineer in substantially the form of Exhibit F-5A hereto,
dated the Closing Date. 

        3.1.17    Fuel Consultant's and Power Market Consultant's Final Reports and Certificates.    

        (a)  Delivery
to Administrative Agent of a final Fuel Consultant's report with respect to each Project, in form and substance reasonably satisfactory to each of the Banks and
each of the Lender Groups, together with a certificate of the Fuel Consultant in substantially the form of Exhibit F-6A hereto, dated
the Closing Date. 

        (b)  Delivery
to Administrative Agent of a final Power Market Consultant's report with respect to each Project, in form and substance reasonably satisfactory to each of the
Banks and each of the Lender Groups, together with a certificate of the Power Market Consultant in substantially the form of  Exhibit F-7A hereto, dated the Closing Date. 

        3.1.18    Approved Projects.    Each of the Millennium Project and at least two other Projects shall be Approved
Projects as of the Closing Date. 

        3.1.19    Agent for Service of Process.    Delivery to Administrative Agent of evidence reasonably satisfactory to
each of the Banks and each of the Lender Groups that each of NEG and Borrower has appointed Corporate Service Company as its agent for service of process in the State of New York in respect of each
Credit Document to which such Person is a party which is governed by the laws of the State of New York. 

        3.1.20    Representations and Warranties.    Each representation and warranty of NEG and Borrower in any Credit
Document shall be true and correct as of the Closing Date (unless any such representation and warranty relates solely to an earlier date, in which case it shall have been true and correct as of such
earlier date). 

        3.1.21    No Defaults.    No Borrower Inchoate Default or Borrower Event of Default shall have occurred and be
continuing as of the Closing Date. 

        3.1.22    No Material Adverse Change.    Except as set forth in the Information Memorandum, since December 31,
2000 no development, event or change in respect of NEG, Borrower or any Project has occurred that has caused or evidences, either individually or in the aggregate, a Borrower Material Adverse Effect
or a Project Material Adverse Effect. 

        3.1.23    No Litigation.    

        (a)  Except
as set forth in Exhibit G-5B or the Information Memorandum, there shall be no
(i) injunction, writ, preliminary restraining order or other order of any nature by an 

39

 

arbitrator, court or any other Governmental Authority, or (ii) action, suit, arbitration, investigation or proceeding at law or in equity by or before any arbitrator, court or any other
Governmental Authority, pending against Borrower or, to Borrower's actual knowledge, threatened against Borrower or any property or other assets or rights of Borrower. 

        (b)  Except
as set forth in Exhibit G-5B or the Information Memorandum, there shall be no
(i) injunction, writ, preliminary restraining order or other order of any nature by an arbitrator, court or any other Governmental Authority, or (ii) action, suit, arbitration,
investigation or proceeding at law or in equity by or before any arbitrator, court or any other Governmental Authority, pending against NEG or, to Borrower's actual knowledge, threatened against NEG
or any property or other assets or rights of NEG, except in each case that would not reasonably be expected to have a Borrower Material Adverse Effect. 

        3.1.24    No Change in Tax Laws.    No change shall have been adopted, since the date on which this Agreement was
executed and delivered, in any tax law or tax regulation or judicial interpretation
thereof that would subject Administrative Agent, any Bank or any Lender Group Member to any material unreimbursed Tax or Other Tax (other than Taxes or Other Taxes for which Borrower is not required
to indemnify such Lender Group Member pursuant to Section 2.5.4). 

        3.2    Conditions Precedent to the Initial Borrowing of Construction Loans for a Project.    The obligation of the
Banks and the Lender Groups to make the initial Construction Loans with respect to a Subject Project on a proposed Credit Event Date is subject to the prior satisfaction (or written waiver by
Administrative Agent with the consent of the Majority Banks) of each of the following conditions precedent: 

        3.2.1    Credit Event Conditions.    Each of the conditions precedent set forth in  Section 3.12 shall have been satisfied with
respect to Borrower, each Equity Party, each Subject Intermediate Holding Company, the Subject
Project Company and the Subject Project as of the Credit Event Date. 

        3.2.2    Initial Project or Approved Substitute Project.    The Subject Project is (a) an Initial Project or
(b) a Substitute Project that has been substituted for an Initial Project in accordance with Section 3.11. 

        3.2.3    Adjustment Date.    The Credit Event Date is on or prior to the Adjustment Date. 

        3.2.4    Resolutions.    Delivery to Administrative Agent of a copy of one or more resolutions or other
authorizations, in form and substance reasonably satisfactory to Administrative Agent, of the board of directors or other similar governing body of the Subject Project Company, each Subject
Intermediate Holding Company and each of the other applicable Affiliated Major Project Participants, authorizing the execution, delivery and performance of the Operative Documents with respect to the
Subject Project and any instruments or agreements required hereunder or thereunder to which such Person is a party, certified by the appropriate Responsible Officer of each such Person as being in
full force and effect on the Credit Event Date. 

        3.2.5    Incumbency.    Delivery to Administrative Agent of a certificate, in form and substance reasonably
satisfactory to Administrative Agent, from the Subject Project Company, each Subject Intermediate Holding Company and each of the other applicable Affiliated Major Project Participants, signed by the
appropriate Responsible Officer of each such Person and dated the Credit Event Date, as to the incumbency of the natural Persons authorized to execute and deliver the Operative Documents with respect
to the Subject Project and any instruments or agreements required hereunder or thereunder to which such Person is a party. 

40

  

        3.2.6    Formation Documents.    Delivery to Administrative Agent of (a) copies of the articles of
incorporation or certificate of incorporation, certificate of formation or charter or other state certified constituent documents of the Subject Project Company, each Subject Intermediate Holding
Company and each of the other applicable Affiliated Major Project Participants, certified by the secretary of state of such Person's state of formation or incorporation, and (b) copies of the
limited liability company agreement, bylaws or other comparable constituent documents of each such Person, certified by the appropriate Responsible Officer of each such Person. 

        3.2.7    Good Standing Certificates.    Delivery to Administrative Agent of certificates issued by the secretary of
state of the state in which the Subject Project Company, each Subject Intermediate Holding Company and each of the other applicable Affiliated Major Project Participants are formed or incorporated,
together with certificates issued by the secretary of state of the state where the Subject Project is located, in each case (a) dated no more than five days prior to the Credit Event Date and
(b) certifying that such Person is in good standing and is qualified to do business in, and has paid all franchise taxes or similar taxes due to, such states. 

        3.2.8    Operative Documents.    

        (a)  Delivery
to Administrative Agent of (i) a true, correct and complete original of a Project Company Guaranty duly executed by the Subject Project Company, and
(ii) a true, correct and complete original of each Intercompany Note in respect of the on-lending of Loan proceeds from Borrower to the Subject Project Company (either directly or
through the applicable Approved Intermediate Holding Companies) duly executed by Borrower and the Subject Project Company and/or the applicable Approved Intermediate Holding Companies. 

        (b)  Delivery
to Administrative Agent of true, correct and complete originals of (i) a Project Company Security Agreement duly executed by the Subject Project Company,
(ii) a Mortgage duly executed by the Subject Project Company, (iii) Pledge Agreements with respect to the equity interests in the Subject Project Company and the equity interests in the
Subject Intermediate Holding Companies, duly executed by the Subject Intermediate Holding Companies or Borrower, as applicable, and (iv) all other documents, instruments, supplements or
amendments necessary to create a valid and perfected first priority Lien on all Project Company Collateral related to the Subject Project, Subject Project Company or Subject Intermediate Holding
Companies then in existence. 

        (c)  Delivery
to Administrative Agent of true, correct and complete originals of the Interest Rate Agreement(s) required by  Section 5.13.1. 

        (d)  Delivery
to Administrative Agent of a true, correct and complete original of one or more joinder agreements, in substantially the form of  Exhibit B to the Depositary Agreement, duly executed by the Subject
Project Company and the Subject Intermediate Holding Companies. 

        (e)  Delivery
to Administrative Agent of a true, correct and complete original of a subordination agreement in form and substance reasonably satisfactory to the Majority
Banks for each Project Document with respect to the Subject Project under which Subordinated Affiliate Fees are payable. 

        (f)    Delivery
to Administrative Agent of true, correct and complete copies of each Major Project Document with respect to the Subject Project in effect as of the Credit Event
Date, together with a certificate of a Responsible Officer of Borrower stating that: (i) such copies are true, correct and complete copies of all material contracts (other than the Credit
Documents) related to the Subject Project as in effect on the Credit Event Date; (ii) all of such Major Project Documents are in full force and effect as of the Credit Event Date;
(iii) the Subject Project Company has not received notice of any default of the Subject Project 

41

 

Company under any of such Major Project Documents; (iv) to Borrower's actual knowledge, no other party to any of such Major Project Documents is or, but for the passage of time or the giving
of notice will be, in breach of any material obligation thereunder; and (v) all conditions precedent to the performance of the parties under such Major Project Documents then required to have
been performed have been satisfied. 

        (g)  Delivery
to Administrative Agent of a true, correct and complete original of a Consent executed by each Major Project Participant for the Subject Project listed on  Exhibit W-1, in substantially the form of
Exhibit E hereto (or otherwise in
form and substance reasonably satisfactory to the Majority Banks). 

        (h)  Delivery
to Administrative Agent of true, correct and complete copies of (i) all shared use agreements and/or joint ownership agreements reasonably requested by
the Majority Banks evidencing the Subject Project Company's interests, rights and obligations with respect to any shared facilities incorporated into or used with respect to the Subject Project, and
(ii) all intercreditor agreements and/or non-disturbance agreements reasonably requested by the Majority Banks establishing the relative rights and remedies between Administrative
Agent and any other Persons with interests in any such shared facilities or other properties incorporated into or used with respect to the Subject Project, in each case in form and substance
reasonably satisfactory to the Majority Banks. 

        (i)    Delivery
to Administrative Agent of true, correct and complete copies of all documents reasonably requested by the Majority Banks to effect the contribution to Borrower
of the equity interests in the Subject Intermediate Holding Companies on the Credit Event Date. 

Unless
otherwise specified above, all the Operative Documents specified above shall be in form and substance reasonably satisfactory to the Majority Banks and shall have been duly authorized, executed
and delivered by the parties thereto. 

        3.2.9    UCC Reports.    Delivery to Administrative Agent of a UCC report dated as of a date no more than five days
prior to the Credit Event Date for each of the jurisdictions in which UCC-1 financing statements are intended to be filed in respect of the Project Company Collateral related to the
Subject Project, Subject Project Company or Subject Intermediate Holding Companies, confirming that upon due filing (assuming such filing occurred on the date of such respective reports) the security
interests created under the Project Company Collateral Documents will be prior to all other financing statements or other security documents wherein the security interest is perfected by filing in
respect of such Project Company Collateral, other than (a) financing statements or other security documents evidencing security interests that will be released and/or discharged on or prior to
the Credit Event Date and (b) financing statements or other security documents evidencing Project Company Permitted Liens. 

        3.2.10    UCC Filings.    

        (a)  Borrower
shall have delivered to Administrative Agent a supplement to Exhibit D-5 hereto (which
Exhibit shall be automatically amended without further action to give effect to such supplement on the Credit Event Date) reflecting the filings and recordings required to be made to perfect security
interests in the Project Company Collateral related to the Subject Project, which supplement shall be in form and substance reasonably satisfactory to the Majority Banks. 

        (b)  All
actions (including the actions described on the applicable Part of Exhibit D-5) shall have been
taken to provide Administrative Agent, for the benefit of the Secured Parties, with a valid and perfected first priority Lien on all Project Company Collateral related to the Subject Project, Subject
Project Company or Subject Intermediate Holding Companies then in 

42

 

existence (subject to Project Company Permitted Liens), including, to the extent necessary, (i) the filing of UCC-1, UCC-2 or UCC-3 financing statements, as
applicable, with respect to such Project Company Collateral with the secretary of state and/or other appropriate filing office in the state in which the Subject Project is located, in the state of
formation of the Subject Project Company or Subject Intermediate Holding Companies or the state in which the Subject Project Company's or Subject Intermediate Holding Companies' principal place of
business is located, (ii) the execution, delivery and recordation of the applicable Mortgage(s) and (iii) the filing of fixture filings with respect to the Subject Project. 

        3.2.11    Incremental Commitments and/or Permitted Additional Equity.    If the Subject Project is the fourth Project
to become an Approved Project hereunder (other than in connection with the substitution of a Substitute Project for an Approved Project in accordance with  Section 3.11), the aggregate amount of
(a) Incremental Commitments plus (b) at the
election of Borrower in its sole discretion, Permitted Additional Equity, as of March 31, 2002 and as of the Credit Event Date, shall be at least $625,000,000. 

        3.2.12    Legal Opinions.    

        (a)  Delivery
to Administrative Agent of legal opinions of counsel to each Credit Party and each other Affiliated Major Project Participant that is a party to an Operative
Document delivered pursuant to Section 3.2.8, in each case in form and substance reasonably satisfactory to the Majority Banks. 

        (b)  Delivery
to Administrative Agent of legal opinions of counsel to each Major Project Participant listed on  Exhibit W-2 that is a party to a Major Project Document delivered pursuant to  Section 3.2.8, in each case in substantially the form of Exhibit B to Exhibit E
hereto (or otherwise in form and substance reasonably satisfactory to the Majority Banks). 

        3.2.13    Insurance.    Insurance with respect to the Subject Project complying with  Exhibit M to the applicable Project Company
Guaranty shall be in full force and effect and Administrative Agent shall have received: (i) a
certificate of the Insurance Consultant substantially in the form of Exhibit F-4 with respect to the Subject Project; (ii) a
report of the Insurance Consultant describing the insurance program for the Subject Project, in form and substance reasonably satisfactory to the Majority Banks; (iii) insurance brokers'
certificates evidencing such insurance program, in form and substance reasonably satisfactory to the Majority Banks, identifying underwriters, types of insurance, insurance limits and policy terms,
listing the special provisions required as set forth in Exhibit M to the applicable Project Company Guaranty, and stating that such insurance is
in full force and effect and that all premiums then due thereon have been paid; and (iv) certified copies of all policies evidencing such insurance (or a binder or commitment signed by the
insurer or a broker authorized to bind the insurer) in form and substance reasonably satisfactory to the Majority Banks. 

        3.2.14    Independent Engineer's Final Report and Certificate.    Delivery to Administrative Agent of a final
Independent Engineer's report with respect to the Subject Project, in form and substance reasonably satisfactory to the Majority Banks, together with a certificate of the Independent Engineer in
substantially the form of Exhibit F-5B hereto, dated the Closing Date. 

        3.2.15    Reports of the Environmental Consultant.    Delivery to Administrative Agent of (a) the Environmental
Consultant's Phase I report(s) with respect to the Subject Project in form and substance reasonably satisfactory to the Majority Banks, together with a corresponding reliance letter from the
Environmental Consultant (which letter shall be in form and substance reasonably satisfactory to Administrative Agent), confirming that no evidence was found of a Release at the Subject Project
(including the Site thereof), or (b) if evidence was found of a Release at the Subject Project (including
the Site thereof) pursuant to such Phase I environmental report(s) or such report(s) otherwise recommend a Phase II environmental review, (i) a Phase II environmental 

43

 

report with respect to the Subject Project (including the Site thereof) in form and substance reasonably satisfactory to the Majority Banks, together with a corresponding reliance letter from the
Environmental Consultant (which letter shall be in form and substance reasonably satisfactory to Administrative Agent), confirming (to the reasonable satisfaction of Administrative Agent in the case
of clause (A), and to the reasonable satisfaction of the Majority Banks in the case of clause (B)), either (A) that no Release has occurred at the Subject Project (including the
Site thereof), or (B) if a Release has occurred at the Subject Project (including the Site thereof), that such Release either does not trigger any reporting or remediation obligations or has
been remediated to acceptable regulatory levels, or (ii) an environmental indemnity agreement in form and substance reasonably satisfactory to the Majority Banks. 

        3.2.16    Updated Fuel Consultant's Report and Certificate.    If the Initial Credit Event Date with respect to the
Subject Project is after the Closing Date, delivery to Administrative Agent of a certificate of the Fuel Consultant with respect to the Subject Project in substantially the form of  Exhibit F-6B
hereto, and, if the Fuel Consultant's report with respect to the Subject Project that was delivered on the Closing Date
needs to be updated in order for the Fuel Consultant to issue such certificate, such report as so updated in form and substance reasonably satisfactory to the Majority Banks. 

        3.2.17    Updated Power Market Consultant's Report and Certificate.    If the Initial Credit Event Date with respect
to the Subject Project is after the Closing Date, delivery to Administrative Agent of a certificate of the Power Market Consultant with respect to the Subject Project in substantially the form of  Exhibit F-7B hereto, and, if the Power Market Consultant's report with respect to the Subject Project that was delivered on the
Closing Date needs to be updated in order for the Power Market Consultant to issue such certificate, such report as so updated in form and substance reasonably satisfactory to the Majority Banks. 

        3.2.18    Permits.    

        (a)  Delivery
to Administrative Agent of the schedule of all material Permits required to develop, construct, own, lease, use, operate and maintain the Subject Project (a
"Permit Schedule"), in form and substance reasonably satisfactory to the Majority Banks. 

        (b)  Delivery
to Administrative Agent of (i) copies of each Permit listed on Part I of such Permit Schedule, each in form and substance reasonably satisfactory
to the Majority Banks, and (ii) legal opinions of counsel to the Subject Project Company with respect to the Permits listed on such Permit Schedule, each in form and substance reasonably
satisfactory to the Majority Banks. The Permits set forth on Part I of such Permit Schedule shall constitute in the Majority Banks' reasonable opinion all of the material Permits required or
customarily obtained for the development, construction, ownership, leasing, use, operation and maintenance of the Subject Project as of the Credit Event Date. 

        (c)  Part II
of such Permit Schedule shall list all other Permits required to develop, construct, own, lease, use, operate and maintain the Subject Project as
contemplated by the Operative Documents. The Permits listed in Part II of such Permit Schedule shall either (i) in the Majority Banks' reasonable opinion, be timely obtainable at a cost
consistent with the applicable Project Budget without material difficulty or delay prior to the time such Permits are required for the development, construction, ownership, leasing, use, operation or
maintenance of the Subject Project, or (ii) there shall exist alternative solutions (the expected cost of which is reflected in the applicable Project Budget) reasonably satisfactory to the
Majority Banks which would eliminate the need for such Permits. 

        (d)  Except
as disclosed in such Permit Schedule, the Permits listed in Part I of such Permit Schedule shall not be subject to any restriction, condition, limitation
or other provision that would reasonably be expected to have a Project Material Adverse Effect with respect to 

44

 

the Subject Project Company or result in the Subject Project being operated in a manner substantially inconsistent with the assumptions underlying the Base Case Project Projections most recently
delivered hereunder. 

        3.2.19    Financial Statements.    Delivery to Administrative Agent of accurate and complete copies of (a) the
most recent annual financial statements (audited if available) or Form 10-K filed with the Securities and Exchange Commission and (b) the most recent quarterly financial
statements or Form 10-Q filed with the Securities and Exchange Commission, in each case of the Subject Project Company, each other Affiliated Major Project Participant that is a
party to an Operative Document delivered pursuant to Section 3.2.8 and each other Major Project Participant listed in  Exhibit G-3 with respect to
the Subject Project, together with, in the case of the Subject Project Company or such other Affiliated
Major Project Participant, certificates from the appropriate Responsible Officer thereof, stating that such financial statements have been prepared in conformity with GAAP and fairly present, in all
material respects, the financial position (on a consolidated and, where applicable, consolidating basis) of the Persons described in such financial statements as at the respective dates thereof and
the results of operations and cash flows (on a consolidated and, where applicable, consolidating basis) of the Persons described therein for each of the periods then ended, subject, in the case of any
such unaudited financial statements, to changes resulting from audit and normal year-end adjustments. 

        3.2.20    Base Case Project Projections.    Delivery to Administrative Agent of (a) Base Case Project
Projections for the Subject Project, updated from the Base Case Project Projections submitted for the Subject Project pursuant to  Section 3.1.12(a), if necessary, (b) Base Case Project
Projections for the Subject Project and the other Approved Projects (taken as a
whole), using the Base Case Project Projections submitted for such Projects pursuant to this Section 3.2.20, showing minimum and average annual
projected Debt Service Coverage Ratios over the period set forth in the Base Case Project Projections of no less than (i) 2.0 to 1.0 and 3.0 to 1.0, respectively, if there are three or four
Approved Projects (including the Subject Project), or (ii) 2.25 to 1.0 and 3.25 to 1.0, respectively, if there are two Approved Projects (including the Subject Project), (c) the
calculation of the Debt to Capitalization Ratio necessary to achieve the Debt Service Coverage Ratios described in clause (b) immediately above, which shall not be greater than 0.60 to 1.0, and
(d) a certificate of a Responsible Officer of each of Borrower and each Equity Party confirming (i) the Total Equity Commitment after giving effect to the Subject Project
becoming an Approved Project and (ii) the Available Equity Commitment after giving effect to all Equity Contributions and In Kind Equity Payments made on or prior to the Credit Event Date, each
of which shall be in form and substance reasonably satisfactory to the Majority Banks. 

        3.2.21    Project Schedules; Project Budgets; Annual Operating Budgets; Borrower Budget.    

        (a)  If
the Subject Project has not achieved Substantial Completion as of the Credit Event Date, delivery to Administrative Agent of (i) a Project Schedule for the
Subject Project, updated from the Project Schedule submitted for the Subject Project pursuant to Section 3.1.11, if any, and (ii) a
Project Budget for the Subject Project, updated from the Project Budget submitted for the Subject Project pursuant to Section 3.1.10, if any, in
each case in form and substance reasonably satisfactory to the Majority Banks. 

        (b)  If
the Subject Project has achieved Substantial Completion as of the Credit Event Date, delivery to Administrative Agent of an Annual Operating Budget prepared in a
manner consistent with, and in compliance with the requirements of, Section 4.16.2 of the applicable Project Company Guaranty, and otherwise in
form and substance reasonably satisfactory to the Majority Banks. 

        (c)  Delivery
to Administrative Agent of a budget (or an update of the budget previously delivered pursuant to this  Section 3.2.21(c), as applicable) showing all anticipated Project Costs 

45

 

for the Subject Project and any Approved Project that are not included in the Project Budget for the Subject Project or such Approved Project, which budget (or update thereof) shall be in form and
substance reasonably satisfactory to the Majority Banks. 

        3.2.22    Real Estate Rights; A.L.T.A. Surveys.    The Majority Banks shall (a) be reasonably satisfied that
the Subject Project Company shall have obtained all real estate rights necessary for construction, use and operation of the Subject Project (other than rights that the Majority Banks are reasonably
satisfied can be obtained without material difficulty or delay by the time they are needed), and (b) have received A.L.T.A. surveys of the applicable Site and, unless not required by
Administrative Agent, the Easements with respect to the Subject Project in existence on the Credit Event Date (which surveys shall be reasonably current and in form and substance reasonably
satisfactory to the Majority Banks and the Title Insurer), showing (A) as to such Site, the exact location and dimensions thereof (including the location of all means of access thereto and all
Easements relating thereto and showing the perimeter within which all foundations are or are to be located); (B) as to such Easements in existence on the Credit Event Date, the exact location
and dimensions thereof (including the location of all means of access thereto, and all improvements or other encroachments in or on such Easements burdening the Subject Project in existence on the
Credit Event Date); (C) the existing utility facilities servicing the Subject Project (including water, electricity, gas, telephone, sanitary sewer and storm water distribution and detention
facilities); (D) that such existing improvements on the Site do not encroach or interfere with adjacent property or existing Easements or other rights, whether on, above or below ground (or if
such existing improvements encroach or interfere with adjacent property or existing Easements or other rights, such encroachment or interference is reasonably acceptable to the Majority
Banks); (E) any gaps, gores, projections or protrusions at the Site; and (F) whether such Site or any portion thereof is located in a special earthquake or flood hazard zone;  provided,
however, that the matters described in clauses (B) and (F) of this subsection
(b) may be shown by separate maps, surveys or other manner reasonably satisfactory to the Majority Banks, and the surveyor shall not be required to certify as to the location of any easements,
foundations, improvements, encroachments, utilities or other matters which do not exist as of the Credit Event Date. 

        3.2.23    Title Policies.    Delivery to Administrative Agent of a lender's A.L.T.A. policy of title insurance (with,
in the case of Easements with respect to which A.L.T.A. surveys were not required by Administrative Agent pursuant to Section 3.2.22, appropriate
survey exceptions), together with such endorsements as are reasonably required by the Majority Banks and permitted by applicable Governmental Rules (and, in any event, without a mechanics' or
materialmen's exception included in such title policy, except where applicable Governmental Rules prevent the deletion of such exception), or commitment to issue such policy, dated as of the Credit
Event Date, (1) in an amount equal to the aggregate amount of Project Costs set forth in the Project Budget delivered pursuant to  Section 3.2.21 (or such other lesser amount as is reasonably
acceptable to the Majority Banks), and (2) with such reinsurance as is
reasonably satisfactory to the Majority Banks, issued by the Title Insurer in form and substance reasonably satisfactory to the Majority Banks, insuring (or agreeing to insure) that: 

        (a)  the
Subject Project Company has a good, marketable and insurable fee or leasehold title to or right to control, occupy and use the Site and the Easements with respect to
the Subject Project, free and clear of Liens, encumbrances or other exceptions to title other than Permitted Project Company Liens; and 

        (b)  the
Mortgage with respect to the Subject Project creates (or will create when recorded) a valid first lien on the Mortgaged Property with respect to the Subject Project,
free and clear of all liens, encumbrances and exceptions to title whatsoever (other than those liens, encumbrances and other exceptions to title permitted pursuant to  Section 3.2.23(a)).

46

 

        3.2.24    Regulatory Status.    The Subject Project shall be an Eligible Facility and the Subject Project Company
shall have received a determination from FERC that it is an Exempt Wholesale Generator. The Subject Project Company shall have obtained authority to sell at wholesale Power, Ancillary Services and, to
the extent permitted under its FERC tariff, other products and services at market-based rates. FERC shall not have imposed any rate caps or mitigation measures on the Subject Project Company other
than rate caps and mitigation measures generally applicable to similarly situated generators selling Power, Ancillary Services or some combination of the foregoing in the Applicable Markets. 

        3.2.25    Notice to Proceed.    If the Subject Project has not achieved Substantial Completion as of the Credit Event
Date, the Contractors with respect to the Subject Project shall have been (or shall be concurrently) given an unconditional notice to proceed or otherwise been (or concurrently will be)
unconditionally directed to begin performance under the Construction Contracts to which they are a party on or prior to the Credit Event Date, and Administrative Agent shall have received reasonably
satisfactory written evidence thereof. 

        3.2.26    Utilities.    Delivery to Administrative Agent of evidence reasonably satisfactory to the Majority Banks
showing that all gas and electrical interconnection and utility services necessary for the construction and operation of the Subject Project for its intended purposes are available for the Subject
Project or will be so available as and when required on commercially reasonable terms consistent with the Project Budget and Project Schedule, or Annual Operating Budget, as the case may be, delivered
pursuant to Section 3.2.21 and the Base Case Project Projections delivered pursuant to  Section 3.2.20. 

        3.2.27    Agent for Service of Process.    Administrative Agent shall have received evidence reasonably satisfactory
to the Majority Banks that the Subject Project Company and the Subject Intermediate Holding Companies have appointed Corporate Service Company as their agent for service of process in the State of New
York in respect of each Credit Document to which the Subject Project Company or the Subject Intermediate Holding Companies is or are a party which is governed by the laws of the State of New York. 

        3.2.28    Conditions Applicable Only to the Subject Project.    Administrative Agent shall have received evidence
reasonably satisfactory to the Majority Banks that each of the conditions set forth in Exhibit G-4 with respect to the Subject
Project has been satisfied. 

        3.3    Conditions Precedent to each Borrowing of Construction Loans.    The obligation of the Banks and the Lender
Groups to make each Construction Loan (including the initial Construction Loan for an Approved Project) is subject to the prior satisfaction (or written waiver by Administrative Agent with the consent
of the Majority Banks) of each of the following conditions precedent (provided that the conditions precedent described in  Sections 3.3.4, 3.3.6, 3.3.7 and
3.3.10 will not apply to the initial Construction Loan for an Approved Project): 

        3.3.1    Credit Event Conditions.    Each of the conditions precedent set forth in  Section 3.12 shall have been satisfied with
respect to Borrower, each Equity Party, each Subject Intermediate Holding Company, the Subject
Project Company and the Subject Project as of the Credit Event Date. 

        3.3.2    Approved Project.    The Subject Project shall be an Approved Project as of the Credit Event Date. 

        3.3.3    Construction Requisition.    Borrower shall have delivered a Construction Requisition to Administrative Agent
in accordance with the procedures specified in Section 2.1.1(b). 

        3.3.4    Title Policy Endorsement.    Borrower shall have provided, or Administrative Agent shall be adequately
assured that the Title Insurer is committed as of the Credit Event Date to issue to 

47

 

Administrative Agent, a date-down endorsement of the relevant Title Policies to the Credit Event Date, (a) insuring or otherwise establishing to the satisfaction of Administrative
Agent the continuing first priority of the applicable Mortgage(s) (subject only to Project Company Permitted Liens), and (b) otherwise in form and substance reasonably satisfactory to
Administrative Agent. 

        3.3.5    Lien Releases.    If requested by Administrative Agent and subject to the Subject Project Company's right to
contest liens as described in the definition of "Project Company Permitted Liens", Borrower shall have delivered to Administrative Agent duly executed acknowledgments of payments and releases of
mechanics' and materialmen's liens, in form and substance reasonably satisfactory to Administrative Agent, from each relevant Contractor and Major Subcontractor thereof (to the extent such Major
Subcontractor is in direct privity with the Subject Project Company) for all work, services and materials (including equipment and fixtures of all kinds) done, previously performed or furnished for
the construction of the Subject Project; provided, however, that such releases may be conditioned upon
receipt of payment with respect to work, services and materials to be paid for with the proceeds of the requested Construction Loans pursuant to this  Section 3.3. 

        3.3.6    Permits    

        (a)  Except
as disclosed in the Permit Schedule applicable to the Subject Project, all material Permits with respect to the development, construction, ownership, leasing,
use, operation or maintenance of the Subject Project required to have been obtained by the Credit Event Date shall have been issued and be in full force and effect and not subject to legal proceedings
or to any unsatisfied conditions that would reasonably be expected to result in a material modification or revocation, and all applicable appeal periods with respect thereto shall have expired. 

        (b)  With
respect to any material Permit not yet obtained, either (i) in the Majority Banks' reasonable opinion, such Permit is reasonably expected to be timely
obtainable at a cost consistent with the applicable Project Budget without material difficulty or delay prior to the time such Permit is required for the development, construction, ownership, leasing,
use, operation or maintenance of the Subject Project, or (ii) there shall exist alternate solutions (the expected cost of which is reflected in the applicable Project Budget) reasonably
satisfactory to the Majority Banks which would eliminate the need for such Permit. 

        (c)  Except
as disclosed in the applicable Permit Schedule, such Permits which have been obtained shall not be subject to any restriction, condition, limitation or other
provision that would reasonably be expected to have a Borrower Material Adverse Effect or a Project Material Adverse Effect with respect to the Subject Project. 

        3.3.7    Additional Documentation.    With respect to Additional Project Documents that are Major Project Documents
and material Permits for the Subject Project entered into or obtained, transferred or required (whether because of the status of the construction or operation of the Subject Project or otherwise)
since the date of the previous Credit Event Date for the Subject Project, in furtherance of, among other things, the Liens on the Subject Project and related Collateral granted on the Closing Date or
the Initial Credit Event Date for the Subject Project, as the case may be, there shall have been delivery and satisfaction of such matters as are described in (and subject to the limitations,
approvals and other requirements set forth in) Sections 3.2.4 through 3.2.8 and  3.2.12 to the extent
applicable to such Additional Project Documents that are Major Project Documents or material Permits. 

        3.3.8    Acceptable Work; No Liens.    All work that has been done on the Subject Project shall have been done in a
good and workmanlike manner and in accordance with the Construction Contracts therefor and Prudent Utility Practices, and there shall not have been filed with or served upon the Subject Project
Company or any other Credit Party with respect to the Subject Project or 

48

 

any part thereof, notice of any Lien, claim of Lien or attachment upon or claim affecting the right to receive payment of any of the moneys payable to any of the Persons named on such request, other
than Liens, claims of Lien, attachments or claims (a) constituting Project Company Permitted Liens, (b) that have been released by payment or bonding or otherwise, (c) for which
adequate funds have been withheld or reserved in the reasonable determination of Administrative Agent or (d) that will be released with the payment of such obligation out of the Construction
Loans to be made on the Credit Event Date or Equity Contributions or other non-Loan proceeds. 

        3.3.9    Casualty.    If as of the Credit Event Date a Casualty Event shall have occurred with respect to the Subject
Project, Administrative Agent shall have received Casualty Insurance Proceeds or other assurances sufficient in the reasonable judgment of Administrative Agent and the Independent Engineer to assure
restoration and completion of the Subject Project prior to the scheduled Final Maturity Date and each of the conditions set forth in  Section 4.8.2(a) of the Depositary Agreement shall have been
satisfied. 

        3.3.10    Insurance.    Insurance complying with the requirements of  Section 4.10 of the applicable Project Company Guaranty
shall be in effect, and, upon the request of Administrative Agent, evidence thereof shall
be provided to Administrative Agent. 

        3.3.11    Title Certification.    If the Credit Event Date is on or after January 15, 2002, the A.L.T.A.
surveys delivered for the Subject Project pursuant to Section 3.2.22 shall have been certified to Administrative Agent by a licensed surveyor
reasonably satisfactory to Administrative Agent. 

        Notwithstanding
anything to the contrary contained herein, in the event of any conflict between the terms of this Section 3.3 and
the terms of the Building Loan Agreement, the provisions hereof shall
govern and control. Accordingly, the parties hereto agree that in the event that each of the conditions precedent for a Borrowing of a Construction Loan set forth herein are satisfied, then all
conditions for an Advance (as defined in the Building Loan Agreement) shall be and be deemed satisfied for all purposes thereunder. 

        3.4    Conditions Precedent to Borrowings of Working Capital Loans.    The obligation of the Banks to make each
Working Capital Loan is subject to the prior satisfaction (or written waiver by Administrative Agent with the consent of the Majority Banks) of each of the following conditions precedent: 

        (a)    Credit Event Conditions.    Each of the conditions set forth in  Section 3.12 shall be satisfied with respect to
Borrower, each Equity Party, each Subject Intermediate Holding Company, the Subject Project
Company and the Subject Project as of the Credit Event Date. 

        (b)    Approved Project.    The Subject Project shall be an Approved Project as of the Credit Event Date. 

        (c)    Substantial Completion Date.    The Credit Event Date shall be on or after the Substantial Completion Date for
the Subject Project. 

        (d)    Notice of Working Capital Loan Borrowing.    Borrower shall have delivered a Notice of Working Capital Loan
Borrowing to Administrative Agent in accordance with the procedures specified in Section 2.1.2(b). 

        3.5    Conditions Precedent to the Issuance of Project Letters of Credit.    The obligation of the LC Bank to issue,
extend the Expiration Date of or increase the Stated Amount of a Project Letter of Credit in respect of a Subject Project is subject to the prior satisfaction (or written waiver by Administrative
Agent with the consent of the LC Bank and the Majority Banks) of each of the following conditions precedent (provided that this  Section 3.5
(x) shall not apply to any automatic extensions of the Expiration Date of, or any automatic increases in the Stated Amount of,
any Project 

49

 

Letter of Credit to the extent provided in Section 2.2.13 and (y) shall apply to the increase in the Stated Amount of a Project Letter of
Credit upon the repayment of Project LC Loans only to the extent provided in Section 2.2.7(a)): 

        3.5.1    Credit Event Conditions.    Each of the conditions set forth in  Section 3.12 shall be satisfied with respect to
Borrower, each Equity Party, each Subject Intermediate Holding Company, the Subject Project
Company and the Subject Project as of the Credit Event Date. 

        3.5.2    Approved Project.    The Subject Project shall be an Approved Project as of the Credit Event Date. 

        3.5.3    Notice of LC Activity.    Borrower shall have delivered a Notice of LC Activity to Administrative Agent in
accordance with the procedures specified in Section 2.2.3. 

        3.6    Conditions Precedent to the Issuance of the DSR Letter of Credit.    The obligation of the LC Bank to issue,
extend the Expiration Date of or increase the Stated Amount of the DSR Letter of Credit is subject to the prior satisfaction (or written waiver by Administrative Agent with the consent of the LC Bank
and the Majority Banks) of each of the following conditions precedent (provided that this  Section 3.6 (x) shall not apply to any automatic
extensions of the Expiration Date of, or any automatic increases in the Stated Amount of,
the DSR Letter of Credit to the extent provided in Section 2.2.13 and (y) shall apply to the increase in the Stated Amount of the DSR
Letter of Credit upon the repayment of DSR LC Loans only to the extent provided in Section 2.2.7(a)): 

        3.6.1    Credit Event Conditions.    Each of the conditions set forth in  Section 3.12 shall be satisfied with respect to
Borrower and each Equity Party as of the Credit Event Date. Each of the conditions set forth in  Section 3.12 shall be satisfied with respect to each Approved Intermediate Holding Company, each
Approved Project Company and each Approved
Project as of the Credit Event Date, in each case to the extent the Allocated Portion of the Total DSR LC Commitment for the applicable Approved Project is being used for the DSR Letter of Credit. 

        3.6.2    Amortization Commencement Date.    The Credit Event Date shall be on or after the DSR Start Date. 

        3.6.3    Notice of LC Activity.    Borrower shall have delivered a Notice of LC Activity to Administrative Agent in
accordance with the procedures specified in Section 2.2.3. 

        3.7    Conditions Precedent to the Crediting of Alternatively Sourced Equity Contributions.    The crediting of
Alternatively Sourced Equity Contributions against the Total Equity Commitment as contemplated by Section 3.15.4 is subject to the prior
satisfaction (or written waiver by Administrative Agent with the consent of the Majority Banks) of each of the following conditions precedent: 

        3.7.1    Credit Event Conditions.    Each of the conditions precedent set forth in Sections
3.12.2 and 3.12.3 shall have been satisfied with respect to Borrower, each Equity Party, each Subject Intermediate Holding
Company, the Subject Project Company and the Subject Project as of the Credit Event Date. 

        3.7.2    Certification of Available Equity Commitment.    Borrower shall have delivered to Administrative Agent a
certificate of a Responsible Officer of Borrower, dated as of the Credit Event Date, setting forth the calculation of the Available Equity Commitment (as contemplated by  Section 3.15.4) after
giving effect
to the crediting of such Alternatively Sourced Equity Contributions. Such calculation shall be deemed to be correct unless the Majority Banks object thereto in writing within 15 Banking Days after
receipt by Administrative Agent of the applicable certificate. 

50

 

        3.7.3    No Other Project Defaults.    With respect to the crediting of Excess Cash Flow Contributions, no Project
Event of Default or Project Inchoate Default with respect to an Approved Project shall have occurred and be continuing or shall result from such application. 

        3.7.4    Approved Project.    The Subject Project shall be an Approved Project as of the Credit Event Date. 

        3.7.5    Permitted Application.    Such Alternatively Sourced Equity Contributions shall be, or have been, disbursed
in accordance with Section 4.1.2 of the Depositary Agreement and used to pay Project Costs in accordance with the Borrower Budget and/or the
Project Budget for the Subject Project. 

        3.7.6    Completion; Available Construction Funds.    The Subject Project shall be reasonably expected to achieve
Completion on or prior to the EPC Date Certain therefor and the Available Construction Funds for the Subject Project and all other Approved Projects shall be reasonably expected to be sufficient to
cause the Subject Project and all other Approved Projects to achieve Completion on or prior to the respective EPC Dates Certain therefor, in each case as certified by Borrower and confirmed in writing
by the Independent Engineer. 

        3.7.7    Acceptable Work; No Liens.    All work that has been done on the Subject Project shall have been done in a
good and workmanlike manner and in accordance with the Construction Contracts therefor and Prudent Utility Practices, and there shall not have been filed with or served upon the Subject Project
Company or any other Credit Party with respect to the Subject Project or any part thereof, notice of any Lien, claim of Lien or attachment upon or claim affecting the right to receive payment of any
of the moneys payable to any of the Persons named on such request, other than Liens, claims of Lien, attachments or claims (a) constituting Project Company Permitted Liens, (b) that have
been released by payment or bonding or otherwise, (c) for which adequate funds have been withheld or reserved in the reasonable determination of Administrative Agent or (d) that will be
released with the payment of such obligation out of such Alternatively Sourced Equity Contributions, Borrowings of Construction Loans or other non-Loan proceeds. 

        Notwithstanding
anything in this Section 3.7 or any other provision of this Agreement to the contrary, Alternatively Sourced Equity
Contributions will be credited against the Total Equity Commitment as contemplated by Section 3.15.4 on the date on which each of the conditions
set forth in this Section 3.7 is satisfied with respect thereto, even if such conditions were not satisfied on the date on which such
Alternatively Sourced Equity Contributions were actually made. 

        3.8    Conditions Precedent to Completion.    The achievement by a Subject Project of Completion shall be subject to
the satisfaction (or written waiver by Administrative Agent with the consent of the Majority Banks) of each of the following conditions precedent: 

        3.8.1    Credit Event Conditions.    Each of the conditions set forth in  Section 3.12 shall have been satisfied with respect to
Borrower, each Equity Party, each Subject Intermediate Holding Company, the Subject
Project Company and the Subject Project as of the Credit Event Date. 

        3.8.2    Completion of Work.    Delivery to Administrative Agent, in form and substance reasonably satisfactory to
Administrative Agent, of evidence that (a) all work with respect to the Subject Project requiring inspection by municipal and other Governmental Authorities having jurisdiction has been duly
inspected and approved by such authorities, (b) the Subject Project Company has duly recorded a notice of completion for the Subject Project, (c) all parties performing such work have
been or will be paid for such work, and (d) no mechanics' and/or materialmen's liens or applications therefor have been filed and all applicable filing periods for any such mechanics' and/or
materialmen's liens have expired, other than with respect to Project Company Permitted Liens; provided,  however, that in the event Borrower delivers to
Administrative Agent either (i) a policy of title insurance or endorsement thereto, in form and
substance 

51

 

reasonably satisfactory to Administrative Agent, insuring against loss arising by reason of any mechanics' or materialmen's lien gaining priority over the applicable Mortgage(s) (except where
applicable Governmental Rules prevent the procurement of insurance covering such a loss), or (ii) a bond, in form and substance reasonably satisfactory to Administrative Agent, or evidence
reasonably satisfactory to Administrative Agent that funds have been withheld or reserved, in each case in the amount of all payments owed to any contractor, subcontractor or any other Person, and
covering the Subject Project Company's liability to such contractors, subcontractors or other Persons, Administrative Agent shall waive the requirements referred to in clause (d) above. 

        3.8.3    Substantial Completion; Utility Services.    

        (a)  Substantial
Completion of the Subject Project shall have occurred and all liquidated damages, if any, then due and payable under the Construction Contracts for the
Subject Project (other than liquidated damages that are the subject of a good faith dispute) shall have been paid to the Subject Project Company and deposited into the applicable Accounts in
accordance with the Depositary Agreement. Administrative Agent shall have received a certificate of a Responsible Officer of Borrower, dated the Credit Event Date, certifying as to the matters
described in the immediately preceding sentence, and such certification shall be confirmed in writing by the Independent Engineer. 

        (b)  Administrative
Agent shall have received a certificate of a Responsible Officer of Borrower, dated the Credit Event Date, certifying that (i) all utility
services, roadway access and fuel, power and water interconnection services necessary for the use, operation and maintenance of the Subject Project are
available to the Subject Project Company on commercially reasonable terms, and (ii) all real estate rights necessary for the completion, use, operation and maintenance of the Subject Project
have been obtained. 

        3.8.4    Annual Operating Budget.    Administrative Agent shall have received the Annual Operating Budget with respect
to the Subject Project for the year in which the Subject Project achieved Substantial Completion, which Annual Operating Budget shall have been prepared in a manner consistent with, and in compliance
with the requirements set forth in, Section 4.16.2 of the applicable Project Company Guaranty. In the event that such Annual Operating Budget
does not, in Administrative Agent's and the Independent Engineer's reasonable opinion, properly reflect the operation of the Subject Project during such year as a result of the actual Substantial
Completion Date being different from the anticipated Substantial Completion Date set forth in such Annual Operating Budget, Administrative Agent shall have received an amendment to such Annual
Operating Budget properly reflecting the actual Substantial Completion Date. 

        3.8.5    Insurance.    Insurance complying with the requirements of  Section 4.10 of the applicable Project Company Guaranty
shall be in effect and, upon the request of Administrative Agent, evidence thereof shall
be provided to Administrative Agent. 

52

  

        3.8.6    Permits.    All Permits required for the development, construction, ownership, leasing, use, operation and
maintenance of the Subject Project shall have been obtained and be in form and substance reasonably satisfactory to Administrative Agent, and Borrower shall have delivered or caused to be delivered to
Administrative Agent copies of each such Permit and a certificate of a Responsible Officer of Borrower certifying that all such Permits have been obtained. All such Permits shall be in full force and
effect and not be subject to any legal proceeding or to any unsatisfied condition that would reasonably be expected to result in a material modification or revocation, and all applicable appeal
periods with respect thereto shall have expired. Except as disclosed in the applicable Permit Schedule, all such Permits shall not be subject to any restriction, condition, limitation or other
provision that would reasonably be expected to have a Borrower Material Adverse Effect or a Project Material Adverse Effect with respect to the Subject Project. 

        3.8.7    Title Policy.    Administrative Agent shall have received an endorsement to the A.L.T.A. policy delivered to
Administrative Agent pursuant to Section 3.2.23 with respect to the Subject Project, confirming and insuring the continued first priority of the
Lien on the Mortgaged Property evidenced by the applicable Mortgage(s), subject only to Project Company Permitted Liens (without a mechanics' and materialmen's exception included in such title policy,
except where applicable Governmental Rules prevent the deletion of such exception), and such other matters as Administrative Agent may reasonably request. 

        3.9    Conditions Precedent to a Borrowing of Construction Loans to be Used for In Kind Equity Payments.    The
obligation of the Banks and the Lender Groups to make Construction Loans to be used by Borrower to make In Kind Equity Payments to NEG in respect of In-Kind Equity Contributions made to a
Subject Project Company as contemplated by clause (i) of the proviso to Section 5.1.1(a) is subject to the prior satisfaction (or written
waiver by Administrative Agent with the consent of the Majority Banks) of each of the following conditions precedent (provided that the conditions
precedent set forth in Sections 3.2 and 3.3 shall not apply to the making of Construction Loans to be
used by Borrower to make In Kind Equity Payments): 

        3.9.1    Credit Event Conditions.    Each of the conditions set forth in  Section 3.12 shall be satisfied with respect to
Borrower, each Equity Party, the Subject Project Company, each Subject Intermediate Holding
Company and the Subject Project as of the Credit Event Date. 

        3.9.2    Credit Event Date.    The Credit Event Date must be an Initial Credit Event Date or the Adjustment Date. 

        3.9.3    Commitment Reduction.    If the Credit Event Date is the Adjustment Date, each Total Commitment shall have
been reduced in accordance with Section 2.3.6(b)(i). 

        3.9.4    Construction Requisition.    Borrower shall have delivered a Construction Requisition to Administrative Agent
in accordance with the procedures specified in Section 2.1.1(b). 

        3.9.5    Maximum Amount.    The amount of such Construction Loans cannot exceed: (a) if the Credit Event Date
is the Closing Date, (i) the aggregate amount of In Kind Equity Contributions made on the Credit Event Date in accordance with Section 3.15.2
minus (ii) $450,000,000; or (b) if the Credit Event Date is not the Closing Date, (i) the aggregate amount of In Kind Equity Contributions made on or prior
to the Credit Event Date in accordance with Section 3.15.2 less the aggregate amount of all previous In Kind Equity Payments  minus (ii) the
greater of (A) $450,000,000 and (B) one-half of the then current Total Equity Commitment. 

        3.10    Conditions Precedent to a Borrowing of Construction Loans to be Used for Equity Contribution True-Up Reimbursements and/or NEG EPC
Guaranty Reimbursements.    The obligation of the Banks and the Lender Groups to make Construction Loans to be used by Borrower to make (x) Equity Contribution
True-Up Reimbursements for Equity Contributions made with respect to a Subject Project as contemplated by clause (ii)(A) of the proviso to  Section 5.1.1(a) and/or (y) NEG EPC Guaranty

53

 

Reimbursements for payments under the NEG EPC Guaranty for a Subject Project as contemplated by clause (ii)(B) of the proviso to  Section 5.1.1(a), is subject to the prior satisfaction (or
written waiver by Administrative Agent with the consent of the Majority Banks) of each
of the following conditions precedent (provided that the conditions precedent set forth in Sections 3.2
and 3.3 shall not apply to the making of Construction Loans to be used by Borrower to make Equity Contribution True-Up Reimbursements and/or
NEG EPC Guaranty Reimbursements): 

        3.10.1    Credit Event Conditions.    Each of the conditions set forth in  Section 3.12 shall be satisfied with respect to
Borrower, each Equity Party, the Subject Project Company, each Subject Intermediate Holding
Company and the Subject Project as of the Credit Event Date. 

        3.10.2    Credit Event Date.    The Credit Event Date must be on or after the Last Completion Date. 

        3.10.3    Construction Requisition.    Borrower shall have delivered a Construction Requisition to Administrative
Agent in accordance with the procedures specified in Section 2.1.1(b). 

        3.10.4    Maximum Amount.    The amount of such Construction Loans to be used for an NEG EPC Guaranty Reimbursement
cannot exceed the sum of (a) the aggregate of the remaining Contingencies (if any) for all Approved Projects and (b) the unused amount (if any) in the Borrower Budget. The amount of such
Construction Loans to be used for an Equity Contribution True-Up Reimbursement, together with the amount of all previous Construction Loans used for Equity Contribution True-Up
Reimbursements, cannot exceed (i) the aggregate amount of all Equity Contributions made or caused to be made by Borrower (less all In Kind Equity Payments)  minus (ii) the product of
(x) one minus the Maximum Debt to Capitalization Ratio (expressed as a percentage) and (y) the total
Project Costs for all Approved Projects. 

        3.11    Conditions Precedent to the Substitution of a Project.    Borrower shall have the right to replace one Initial
Project (other than the Millennium Project) with a Substitute Project upon the prior satisfaction (or written waiver by Administrative Agent with the consent of (x) the Majority Banks or
(y) in the case of Section 3.11.6, each of the Banks and each of the Lender Groups) of each of the following conditions precedent: 

        3.11.1    Initial Funding Conditions.    Each of the conditions precedent set forth in  Section 3.2 shall be satisfied with
respect to the Substitute Project, and the initial Borrowing of Construction Loans shall be made for the
Substitute Project, on the date on which the replacement occurs. 

        3.11.2    Approved Project.    If the Initial Project is an Approved Project, the conditions set forth in  Section 6.4 shall be
satisfied with respect to the Approved Project Company that owns the Initial Project;  provided that the condition set forth in clause (iii) of Section 6.4(b)
 shall require the
prepayment of Loans in an amount equal to the greater of (a) the amount of Loans that would otherwise be required to be prepaid pursuant such clause (iii) and (b) the aggregate
amount of Loans borrowed hereunder in respect of the Initial Project that are outstanding as of the date on which the replacement occurs. 

        3.11.3    Credit Event Date.    The Credit Event Date shall be on or prior to the Adjustment Date. 

        3.11.4    Credit Event Conditions.    Each of the conditions set forth in  Section 3.12 shall be satisfied with respect to
Borrower, each Equity Party, each Approved Project Company, each Approved Intermediate Holding
Company and each Approved Project (other than any Approved Project Company, Approved Intermediate Holding Company or Approved Project being released pursuant to  Section 6.4, if applicable) as of
the date on which such replacement occurs. 

        3.11.5    Ratings.    If ratings have been assigned to the Obligations as of the date on which such replacement
occurs, Administrative Agent shall receive written confirmation from each Rating 

54

 

Agency that such ratings will be at least Baa3 in the case of Moody's and at least BBB- in the case of S&P after giving effect to the replacement. 

        3.11.6    Diligence Investigation.    Each of the Banks and each of the Lender Groups shall be reasonably satisfied
with its diligence investigation of the Substitute Project. 

        3.12    Conditions Precedent to Each Credit Event.    The obligation of the Banks and the Lender Groups to effect or
permit each Credit Event is subject to the prior satisfaction (or written waiver by Administrative Agent with the consent of the Majority Banks) of each of the following conditions precedent: 

        3.12.1    Representations and Warranties.    Each representation and warranty of Borrower, each Equity Party, each
Subject Intermediate Holding Company and the Subject Project Company in each Credit Document to which such Person is a party shall be true and correct in all material respects as of the Credit Event
Date (unless any such representation and warranty relates solely to an earlier date, in which case it shall have been true and correct in all material respects as of such earlier date). 

        3.12.2    No Defaults.    No (a) Borrower Event of Default or Borrower Inchoate Default or (b) Project
Event of Default or Project Inchoate Default with respect to the Subject Intermediate Holding Companies, Subject Project Company or Subject Project shall have occurred and be continuing or shall
result from such Credit Event. 

        3.12.3    No Material Adverse Effect.    Other than as set forth in the Information Memorandum or as previously
disclosed to and waived by the Majority Banks in writing on a permanent basis, no event or circumstance having a Borrower Material Adverse Effect or a Project Material Adverse Effect with respect to
the Subject Project Company or Subject Project has occurred and is continuing. 

        3.12.4    No Litigation.    Other than as set forth in the Information Memorandum or  Exhibit G-5B or as previously disclosed to
and waived by the Majority Banks in writing on a permanent basis, no action, suit,
proceeding or investigation shall have been instituted or threatened which would reasonably be expected to have a Borrower Material Adverse Effect or a Project Material Adverse Effect with respect to
the Subject Project Company or Subject Project. 

        3.12.5    Regulation.    Other than as set forth in the Information Memorandum or  Exhibit G-5B or as previously disclosed to and
waived by the Majority Banks in writing on a permanent basis, no order, judgment or
decree shall have been issued by any Governmental Authority that, as a result of the development, construction, ownership, leasing, operation, maintenance or use of the Subject Project by the Subject
Project Company, the sale of Power, Ancillary Services and, to the extent permitted under the Subject Project Company's FERC tariff, other products and services therefrom by the Subject Project
Company, the entering into of any Operative Document or any transaction contemplated
hereby or thereby, other than an exercise of foreclosure remedies by Administrative Agent, any Arranger, any Bank, any Lender Group Member, the LC Bank or any Hedge Bank (or any Affiliate of any of
the foregoing) pursuant to the Credit Documents, would reasonably be expected to (a) cause or deem Administrative Agent, the Arrangers, the Banks, the Lender Group Members, the LC Bank, any
Hedge Bank, Borrower or any Affiliate of any of them to be subject to, or not exempted from, regulation under PUHCA (other than Section 9(a)(2) of PUHCA) or under any state laws and regulations
respecting the rates or the financial or organizational regulation of electric utilities, (b) cause or deem Administrative Agent, the Arrangers, the Banks, the Lender Group Members, the LC Bank
or any Affiliate of any of them, other than any Approved Project Company, to be subject to, or not exempted from, regulation under the FPA, or (c) cause or deem Borrower to be subject to
regulation under the FPA with respect to issuances of securities or the assumption of liabilities. 

55

 

        3.12.6    No Change in Tax Laws.    Other than as previously disclosed to and waived by the Majority Banks in writing
on a permanent basis, since the Closing Date no change shall have been adopted in any tax law or tax regulation or judicial interpretation thereof that would subject any Bank or Lender Group Member to
any material unreimbursed Tax or Other Tax (other than Taxes or Other Taxes for which Borrower is not required to indemnify a Lender Group Member pursuant to  Section 2.5.4). 

        3.12.7    Payment of Filing Fees.    All amounts required to be paid to or deposited with the Banks or the Lender
Groups in respect of the Credit Event, and all taxes, fees and other costs payable in connection with the execution, delivery, recordation and filing of documents and instruments in connection with
the Credit Event, shall have been paid in full or, as approved by the Majority Banks, provided for. 

        3.12.8    Operative Documents and Permits.    Each Credit Document and each Major Project Document and material Permit
related to the Subject Project shall be in full force and effect in accordance with its terms. 

        3.12.9    Debt to Capitalization Ratio.    After giving effect to such Credit Event and any Equity Contributions made
on the Credit Event Date, the Debt to Capitalization Ratio shall not exceed the then current Maximum Debt to Capitalization Ratio. 

        3.13    No Approval of Work.    The making of any Loan hereunder shall not be deemed an approval or acceptance by
Administrative Agent, any Bank or any Lender Group Member of any work, labor, supplies, materials or equipment furnished or supplied with respect to any of the Projects or other assets funded or
acquired with the proceeds of the Loans made hereunder. 

        3.14    Waiver of Funding; Adjustment of Drawdown Requests.    

        (a)  Subject
to Section 9.9, notwithstanding the foregoing, the Majority Banks, without waiving any of the rights of
any Bank or any Lender Group (or any member thereof) hereunder, shall have the right to effect a Credit Event hereunder without full compliance by Borrower with the conditions described in this  Article 3. 

        (b)  In
the event Administrative Agent determines and the Independent Engineer agrees that an item or items listed in a Construction Requisition as a Project Cost is not
properly includible in such Construction Requisition, Administrative Agent may in its reasonable discretion cause to be made a Borrowing of Loans in the amount requested in such Construction
Requisition less the amount of such item or items or may reduce the amount of Loans made pursuant to any subsequent Construction Requisition by such amount. In the event that Borrower prevails in any
dispute as to whether such Project Costs were properly included in such Construction Requisition, Loans in the amount requested but not initially made shall forthwith be made. 

        3.15    Committed Equity Contributions; Available Equity Commitment.    

        3.15.1    Cash Equity Contributions.    

        (a)  (i) On
each Credit Event Date, Borrower shall make, or cause to be made, Cash Equity Contributions in an amount that, after giving effect to (A) the Credit
Event occurring on such Credit Event Date and (B) any Alternatively Sourced Equity Contributions made, or caused to be made, by Borrower or any other Credit Party on such Credit Event Date,
results in the satisfaction on such Credit Event Date of the condition precedent set forth in Section 3.12.9,  provided, however, that if an Inchoate NEG Downgrade Event shall have occurred and be continuing on any
date on which Project Costs for any Approved Project are due and payable (whether or not such date is a Credit Event Date), Borrower shall make, or cause to be made, Cash Equity Contributions in an
amount that, after giving effect to any 

56

 

Alternatively Sourced Equity Contributions then available to pay such Project Costs, is sufficient to pay such Project Costs, and (ii) after the Total Construction Loan Commitment has been
fully utilized, on any date on which Project Costs for any Approved Project are due and payable, Borrower shall make, or cause to be made, Cash Equity Contributions in an amount that, after giving
effect to any Alternatively Sourced Equity Contributions then available to pay such Project Costs, is sufficient to pay such Project Costs, but in no event shall Borrower be required to make Cash
Equity Contributions pursuant to clauses (i) (including pursuant to the proviso thereto) and (ii) above in excess of the then current Available Equity Commitment, plus any Permitted
Additional Equity that Borrower has elected in its sole discretion to provide pursuant to Section 3.2.11. All Cash Equity Contributions made
pursuant to this clause (a) shall be deposited into the Construction Account and disbursed to pay Project Costs for Approved Projects in accordance with the Borrower Budget and/or the Project
Budgets for such Approved Projects pursuant to Section 4.1.2 of the Depositary Agreement. 

        (b)  Upon
the occurrence of any Borrower Event of Default prior to the Last Completion Date and an exercise of remedies under  Section 7.2.4 (or a deemed exercise of remedies as contemplated by the proviso
thereto), Borrower shall make, or cause to be made, Cash Equity
Contributions in an amount equal to the then current Available Equity Commitment. All Cash Equity Contributions made pursuant to this clause (b) shall be deposited into the Loss Proceeds
Account or as otherwise directed by Administrative Agent. 

        3.15.2    In-Kind Equity Contributions.    On the Closing Date, Borrower shall make, or cause to be made,
In Kind Equity Contributions in an amount equal to or greater than $450,000,000. Borrower may make, or cause to be made, additional In Kind Equity Contributions with respect to an Approved Project on
the Initial Credit Event Date for such Approved Project. At least five Banking Days prior to the date on which Borrower proposes to make, or cause to be made, any In Kind Equity Contributions,
Borrower shall submit a certificate substantially in the form of Exhibit F-3 (an "In Kind Equity
Contributions Certificate") to Administrative Agent (with a copy to the Independent Engineer). The amount of In Kind Equity Contributions set forth in such In Kind Equity
Contributions Certificate, as confirmed by Administrative Agent and the Independent Engineer, shall be deemed to be the amount of In Kind Equity Contributions made, or caused to be made, by Borrower
on the applicable Initial Credit Event Date. 

        3.15.3    Total Equity Commitment.    

        (a)  Notwithstanding
anything to the contrary contained in this Agreement or in any other Credit Document, Borrower shall not be required to make, or cause to be made, Equity
Contributions in excess of the lesser of (i) $1,000,000,000 and (ii) the Total Equity Commitment, plus in each case any Permitted Additional Equity that Borrower has elected in its sole
discretion to provide pursuant to Section 3.2.11. The "Total Equity Commitment" shall be
calculated in accordance with this Section 3.15.3. 

        (b)  The
initial Total Equity Commitment as of the Closing Date shall be equal to the aggregate of the Allocated Portions of the Total Equity Commitment for all Projects that
are Approved Projects on the Closing Date. The Total Equity Commitment shall thereafter be increased on each Initial Credit Event Date after the Closing Date by the Allocated Portion of the Total
Equity Commitment for the Project that becomes an Approved Project (including a Substitute Project that replaces an Approved Project) on such Initial Credit Event Date. 

        (c)  In
connection with the transfer by Borrower of 100% of its direct and indirect interests in any Approved Project Company in accordance with  Section 6.4, the Total Equity Commitment shall be reduced by
the unused Allocated Portion of the Total Equity Commitment for the Approved Project
being transferred. 

57

 

        (d)  On
the Last Completion Date (after giving effect to all Borrowings made on such date and all Equity Contributions made or required to be made on such date), the unused
Total Equity Commitment shall be reduced to zero. 

        3.15.4    Available Equity Commitment.    The "Available Equity Commitment" on any date of determination shall be
equal to (a) the Total Equity Commitment, as increased and/or decreased in accordance with Section 3.15.3,  minus (b) all Committed Equity
Contributions made on or prior to such date, minus (c) all
Alternatively Sourced Equity Contributions made on or prior to such date and credited against the Total Equity Commitment in accordance with  Section 3.7, minus (d) the aggregate amount of Incremental Commitments as of such date (up
to a maximum of the aggregate of the original Supplemental Equity Commitments for all then Approved Projects), plus (e) all In Kind Equity
Payments made on or prior to such date in accordance with Section 3.9; provided that the
Available Equity Commitment shall at no time be less than zero. 

ARTICLE 4.
  REPRESENTATIONS AND WARRANTIES  

        Borrower makes the following representations and warranties to and in favor of the Secured Parties as of the Closing Date and as of each Credit Event Date, in
each case to the extent set forth in Article 3. 

        4.1    Organization; Powers.    Borrower (a) is a limited liability company duly formed, validly existing and
in good standing under the laws of the State of Delaware; (b) has all requisite limited liability company power, authority and legal right to own and lease the property and assets it purports
to own or lease and to carry on its business as now being conducted and as proposed to be conducted; (c) is duly qualified to do business in each other jurisdiction where such qualification is
required, except where the failure so to qualify would not reasonably be expected to have a Borrower Material Adverse Effect; and (d) has all requisite limited liability power and authority to
execute, deliver and perform its obligations under each Operative Document and each other agreement or instrument contemplated thereby to which it is a party. 

        4.2    Authorization and No Legal Bar.    The execution, delivery and performance by Borrower of each Operative
Document to which it is a party and the consummation of the transactions contemplated thereby (a) have been duly authorized by all requisite action, including, if required, member action on the
part of Borrower, and (b) will not (i) violate, result in the breach of or constitute a default under any Legal Requirement applicable to or binding on Borrower or any contract,
instrument or other document to which it is a party or by which it is bound, (ii) be in conflict with or result in a breach of the limited liability company agreement of Borrower or constitute
(alone or with notice or lapse of time or both) a Borrower Event of Default or Borrower Inchoate Default or (iii) result in or require the creation or imposition of any Lien (other than a
Borrower Permitted Lien) upon or with respect to any of the Borrower Collateral. 

        4.3    Enforceability.    Each Operative Document to which Borrower is a party has been duly executed and delivered by
Borrower and constitutes a legal, valid and binding obligation of Borrower enforceable against Borrower in accordance with its terms, except as such enforceability (a) may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting the enforcement of creditors' rights and remedies generally and (b) is subject to general principles of
equity (regardless of whether enforceability is considered in a proceeding in equity or at law). 

        4.4    Consents.    No consent or other action by any holder or trustee of any indebtedness or other obligations of
Borrower or by any other Person is or will be required by Borrower in connection with the execution, delivery and performance by Borrower of each Operative Document to which it is a party and the
consummation of any of the transactions contemplated thereby, except such as have been made or obtained and are in full force and effect. 

58

 

        4.5    Compliance with Law.    Except as set forth in  Exhibit G-5A and with respect to which arrangements reasonably
satisfactory to Administrative Agent have been made, Borrower is in
compliance with all Legal Requirements applicable to Borrower, except for such noncompliance as in any case would not reasonably be expected to have a Borrower Material Adverse Effect. 

        4.6    Existing Defaults.    No Borrower Event of Default or Borrower Inchoate Default has occurred and is continuing.
Borrower has not received any notice of default under any agreement relating to any obligation of Borrower for or with respect to borrowed money. 

        4.7    Litigation    

        4.7.1    As
of the Closing Date, except as set forth in Exhibit G-5B or the Information Memorandum, there is
no (a) injunction, writ, preliminary restraining order or other order of any nature by an arbitrator, court or any other Governmental Authority, or (b) action, suit, arbitration,
investigation or proceeding at law or in equity by or before any arbitrator, court or any other Governmental Authority, pending against Borrower or, to the best of Borrower's knowledge, threatened
against Borrower or any property or other assets or rights of Borrower. 

        4.7.2    As
of each Credit Event Date, except as set forth in Exhibit G-5B or the Information Memorandum,
there is no (a) injunction, writ, preliminary restraining order or other order of any nature by an arbitrator, court or any other Governmental Authority, or (b) action, suit,
arbitration, investigation or proceeding at law or in equity by or before any arbitrator, court or any other Governmental Authority, pending against Borrower or, to the best of Borrower's knowledge,
threatened against Borrower or any property or other assets or rights of Borrower, in each case which would reasonably be expected to have a Borrower Material Adverse Effect. 

        4.8    Labor Disputes and Acts of God.    Neither the business nor the properties of Borrower or any Equity Party are
affected by any fire, explosion, accident, strike, lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act of God or of the public enemy, or other casualty (whether or not
covered by insurance), in each case which would reasonably be expected to have a Borrower Material Adverse Effect. 

        4.9    Taxes.    Borrower has filed, or caused to be filed, all Federal, state, local and foreign tax and information
returns that are required to have been filed by it in any jurisdiction, and has paid all taxes shown to be due and payable on such returns and all other taxes and assessments payable by it, to the
extent the same have become due and payable, except to the extent there is a good faith contest thereof by appropriate proceedings by Borrower which are described in  Exhibit G-5C and for which
Borrower shall have set aside adequate reserves to the extent required by GAAP. 

        4.10    Regulation.    So long as the Approved Project Companies continue to be Exempt Wholesale Generators, none of
Borrower, Administrative Agent, any Bank, any Lender Group Member, the LC Bank or any Hedge Bank, nor any Affiliate of any of them, will, solely as a result of the development, construction,
ownership, leasing, use, operation or maintenance of the Approved Projects, the sale of Power, Ancillary Services or, to the extent permitted under the Approved Project Companies' FERC tariffs, other
products and services therefrom or the entering into of any Operative Document in respect thereof or any transaction contemplated hereby or thereby, be subject to, or not exempt from, regulation under
PUHCA (other than Section 9(a)(2) of PUHCA) or under state laws and regulations respecting the rates or the financial or organizational regulation of electric utilities. Except in the event of
the exercise of foreclosure remedies pursuant to the Credit Documents by Administrative Agent, any Bank, any Lender Group Member, the LC Bank or any Hedge Bank (or any Affiliate of any of the
foregoing), none of Administrative Agent, any Bank, any Lender Group Member, the LC Bank or any Hedge Bank, nor any Affiliate of any of them, other than any Approved Project Company, will, solely as a
result of the development, construction, ownership, leasing, use, operation or maintenance of the Approved Projects, the sale of Power, Ancillary Services or, to the extent permitted under the
Approved Project Companies' FERC tariffs, other products and services therefrom or the entering into 

59

 

of any Operative Document in respect thereof or any transaction contemplated hereby or thereby, be subject to, or not exempt from, regulation under the FPA. Borrower is not subject to regulation as a
"public utility", an "electric utility" or a "transmitting utility" under the FPA. Borrower is not subject to regulation under any Governmental Rule as to securities, rates or financial or
organizational matters that would preclude the making or repayment of any Loans, or the incurrence by Borrower of any of the Obligations or the execution, delivery and performance by Borrower of the
Operative Documents to which it is a party. 

        4.11    Private Offering by Borrower.    Assuming that the Banks and the Lender Groups are acquiring the Notes for
investment purposes only, and not for purposes of resale or distribution thereof except for assignments or participations as provided in Sections 2.1.7,  9.13 and 9.14, no registration of the Notes under the Securities Act of 1933, as amended, or under the
securities laws of the State of New York, or any other state in which an Approved Project is located is required in connection with the offering, issuance and sale of the Notes hereunder. Neither
Borrower nor anyone acting on its behalf has taken,
or will take, any action which would subject the offering, issuance or sale of the Notes to Section 5 of the Securities Act of 1933, as amended. 

        4.12    Investment Company Act.    Borrower is not an "investment company" as defined in, or subject to regulation
under, the Investment Company Act of 1940, as amended. 

        4.13    Margin Stock.    Borrower is not engaged, directly or indirectly, principally, or as one of its important
activities, in the business of extending, or arranging for the extension of, credit for the purposes of purchasing or carrying any margin stock, within the meaning of Regulation T, U or X of
the Board of Governors of the Federal Reserve System or any regulations, interpretations or rulings thereunder. No part of the proceeds of any Loans will be used for "purchasing" or "carrying" any
"margin stock" as so defined, or for extending credit to others for the purpose of purchasing or carrying margin stock, or for any purpose which would violate, or cause a violation of, any such
regulation, interpretation or ruling. 

        4.14    ERISA and Employees.    Borrower does not sponsor, maintain, administer, contribute to, participate in, or
have any obligation to contribute to or any liability under, any ERISA Plan, nor since the date which is six years immediately preceding the Closing Date has Borrower established, sponsored,
maintained, administered, contributed to, participated in, or had any obligation to contribute to or liability under, any ERISA Plan. Borrower and each of its Subsidiaries are in compliance in all
material respects with all applicable provisions of ERISA and the Code and all other laws applicable to ERISA Plans, including the Age Discrimination in Employment Act, the Americans With Disabilities
Act and Title VII of the Civil Rights Act. Borrower does not have any employees. 

        4.15    Disclosure.    Neither this Agreement nor any certificate or other documentation (excluding the Borrower
Budget, the Project Budgets, the Annual Operating Budgets and the Base Case Project Projections) furnished to Administrative Agent, the Arrangers and/or any Independent Consultant, by or, to the best
knowledge of Borrower, on behalf of, NEG or Borrower on or prior to the Closing Date in connection with the transactions contemplated by the Operative Documents or the design, description, testing or
operation of a Project (taken as a whole), contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein or therein not
misleading under the circumstances in which they were made at the time such statements are made. As of the Closing Date, there is no fact known to Borrower which has had or would reasonably be
expected to have a Borrower Material Adverse Effect which has not been set forth in this Agreement or in the other documents, certificates and written statements furnished to Administrative Agent, the
Arrangers and/or the Independent Consultants by or on behalf of Borrower in connection with the transactions contemplated hereby. 

        4.16    Budgets.    Borrower has prepared the Borrower Budget, the Project Budgets and the Annual Operating Budgets
and is responsible for developing the assumptions on which the Borrower Budget, 

60

 

the Project Budgets and the Annual Operating Budgets are based; and the Borrower Budget, the Project Budgets and the Annual Operating Budgets (a) as of the date delivered, updated or
supplemented, are based on reasonable assumptions, (b) as of the date delivered, updated or supplemented, are consistent with the provisions of the Operative Documents in effect as of such
date, and (c) as of the date delivered, updated or supplemented, indicate that the estimated Project Costs with respect to a Project will not exceed funds available (including Committed Equity
Contributions) to pay Project Costs with respect to such Project. 

        4.17    Financial Statements.    In the case of each financial statement and the accompanying information delivered by
Borrower hereunder (including financial statements of Borrower, the Project Companies, each Equity Party and any other Affiliated Major Project Participants delivered pursuant to  Sections 3.1.13,
3.2.19 and 5.3, but excluding any
financial statements of any Major Project Participant which is not an Affiliate of NEG), each such financial statement and the accompanying information have been prepared in conformity with GAAP and
fairly present, in all material respects, the financial position (on a consolidated and, where applicable, consolidating basis) of the Persons described in such financial statements as at the
respective dates thereof and the results of operations and cash flows (on a consolidated and, where applicable, consolidating basis) of the Persons described therein for each of the periods then
ended, subject, in the case of any such unaudited financial statements, to changes resulting from audit and normal year-end adjustments. Except for obligations under the Operative
Documents to which it is a party, Borrower does not (and will not following the funding of the initial Loans) have any contingent obligations, unmatured liabilities, contingent liability or liability
for taxes, long-term lease or forward or long-term commitment that is not reflected in the foregoing financial statements or the notes thereto and which in any such case is
material in relation to the business, operations, properties, assets, financial condition or prospects of Borrower and the Approved Project Companies taken as a whole. 

        4.18    Ownership; Other Obligations.    

        (a)  The
membership interests in Borrower are duly authorized and validly issued. As of the Closing Date, PG&E Generating Energy Group, LLC is the sole member of Borrower and
Borrower is an indirect wholly-owned Subsidiary of NEG. There are no options, warrants, convertible securities or other rights to acquire any of the membership interests in Borrower. 

        (b)  All
of the Approved Project Companies are direct wholly-owned Subsidiaries of the applicable Approved Intermediate Holding Companies and all of the Approved Intermediate
Holding Companies are direct wholly-owned Subsidiaries of Borrower; provided that (i) Borrower owns a 1% direct equity interest in each of Covert
Generating Company, LLC and Harquahala Generating Company, LLC, and (ii) Magnolia Power Corporation (which directly owns a 50% general partnership interest in Millennium Power Partners, L.P.)
is a direct wholly-owned Subsidiary of Osprey Power Corporation, which is a direct wholly-owned Subsidiary of Borrower. All of the equity interests in the Approved Project Companies and the Approved
Intermediate Holding Companies are duly authorized, validly issued and, if applicable, fully paid and nonassessable. There are no options, warrants, convertible securities or other rights to acquire
any equity interests in any Approved Project Company or Approved Intermediate Holding Company. Each Approved Project Company holds title to only one Approved Project and each Approved Intermediate
Holding Company owns an equity interest in only one Approved Project Company. 

        (c)  Borrower
(i) does not own equity interests in any Person other than the Approved Intermediate Holding Companies and (ii) is not a party to or bound by any
material contract other than the Credit Documents to which it is a party. 

        4.19    Intellectual Property.    Borrower has obtained the right to use all patents, trademarks, copyrights and other
such rights or adequate licenses therein which are necessary for the operation of its business, free from restrictions which would reasonably be expected to have a Borrower Material Adverse Effect. 

61

 

        4.20    Offices; Location of Borrower Collateral.    

        4.20.1    The
chief executive office or principal place of business (as such term is used in Article 9 of the Uniform Commercial Code as in effect in each state where
the Borrower Collateral is located and the State of New York from time to time) of Borrower is set forth in Exhibit Q hereto (as such exhibit may
be supplemented from time to time upon 30 days' notice to Administrative Agent pursuant to Section 6.13). Borrower's organizational
identification number is 3403269. 

        4.20.2    The
location of Borrower's books of accounts and records is set forth in Exhibit Q hereto (as such exhibit may
be supplemented from time to time by 30 days' notice to Administrative Agent pursuant to Section 6.13). 

        4.21    Borrower Collateral.    

        4.21.1    As
of the Closing Date, (a) all filings, recordings and other actions required to provide Administrative Agent, for the benefit of the Secured Parties, with a
valid and perfected security interest in the Borrower Collateral in existence as of the Closing Date (other than Borrower Collateral in which a security interest can be perfected by possession),
subject to no Liens other than Borrower Permitted Liens, are described in Part I of Exhibit D-5 and have been taken, and
(b) all Borrower Collateral in existence as of the Closing Date in which a security interest can be perfected by possession has been delivered to Administrative Agent. 

        4.21.2    As
of each Credit Event Date (other than the Closing Date), (a) all filings, recordings and other actions required to provide Administrative Agent, for the
benefit of the Secured Parties, with a valid and perfected security interest in the Borrower Collateral in existence as of such Credit Event Date (other than Borrower Collateral in which a security
interest can be perfected by possession), subject to no Liens other than Borrower Permitted Liens, (x) are described in Part I of  Exhibit D-5and have been taken, or (y) have been
notified to Administrative Agent in writing and have been taken, and
(b) all Borrower Collateral in existence as of such Credit Event Date in which a security interest can be perfected by possession has been delivered to Administrative Agent. 

ARTICLE 5.
  AFFIRMATIVE COVENANTS OF BORROWER  

        Borrower covenants and agrees that, so long as any of the Commitments shall remain in effect and until payment and performance in full of all of the Obligations,
Borrower shall perform the covenants set forth in this Article 5 (unless waived in accordance with  Section 9.9 of this Agreement). 

        5.1    Use of Proceeds and Revenues.    

        5.1.1    Proceeds.    (a) Construction Loans. Unless otherwise
expressly provided herein or in the Depositary Agreement, Borrower shall on-lend or contribute the proceeds of all Construction Loans to the applicable Approved Project Company (directly
or through the applicable Approved Intermediate Holding Companies) (provided that the proceeds of Construction Loans to be used to pay Project Costs for
the Athens Project pursuant to the Building Loan Agreement shall be on-lent directly by Borrower to Athens Generating Company, L.P.);  provided, however,
that (i) Borrower may use the proceeds of Construction Loans borrowed on an
Initial Credit Event Date or on the Adjustment Date to make payments to NEG in respect of In Kind Equity Contributions made or caused to be made by Borrower with respect to an Approved Project
pursuant to Section 3.15.2 so long as the conditions precedent set forth in Section 3.9
are satisfied as of the date on which such Construction Loans are made, and (ii) Borrower may use the proceeds of Construction Loans borrowed on the Last Completion Date,
(A) first, in the event an Inchoate NEG Downgrade Event shall have occurred prior to such date, to make payments to NEG in respect of Equity
Contributions made or caused to be made by Borrower with respect to an Approved Project pursuant to the proviso contained in clause (i) of  Section 3.15.1(a), and (B) thereafter, to reimburse 

62

 

NEG for payments made under the NEG EPC Guaranties to pay Project Costs for Approved Projects, so long as, in each case, the conditions precedent set forth in  Section 3.10 are satisfied as of the
date on which such Construction Loans are made. 

        (b)    Working Capital Loans.    Unless otherwise expressly provided herein or in the Depositary Agreement, Borrower
shall (i) on-lend or contribute the proceeds of all Working Capital Loans to be used to pay O&M Costs, as specified in the applicable Notice of Working Capital Borrowing, to the
applicable Approved Project Company (directly or through the applicable Approved Intermediate Holding Companies), and (ii) deposit the proceeds of all Working Capital Loans to be used to pay
interest on Loans or scheduled payment obligations under Interest Rate Agreements, as specified in the applicable Notice of Working Capital Loan Borrowing, in the Debt Payment Account, and use such
proceeds to pay interest on Loans that is due and payable in accordance with this Agreement. 

        (c)    Project Letters of Credit.    Borrower shall use the Project Letters of Credit to support the obligations of
the Approved Project Companies under LC Eligible Project Documents. 

        (d)    DSR Letter of Credit.    Borrower shall use the DSR Letter of Credit to support its obligation to maintain the
DSR Required Balance in the Debt Service Reserve Account pursuant to Section 4.6 of the Depositary Agreement. 

        5.1.2    Revenues.    (a) Prior to the Last Completion Date.
Unless otherwise expressly provided herein or in the Depositary Agreement, Borrower shall deposit, or cause to be deposited, all Project Revenues (other than Loss Proceeds) distributed to or otherwise
received by Borrower prior to the Last Completion Date in the Pre-Completion Revenue Account to be applied in accordance with  Section 4.2.2 of the Depositary Agreement. 

        (b)    On and After the Last Completion Date.    Unless otherwise expressly provided herein or in the Depositary
Agreement, Borrower shall deposit, or cause to be deposited, all Project Revenues (other than Loss Proceeds) distributed to or otherwise received by Borrower on or after the Last Completion Date in
the Post-Completion Revenue Account to be applied in accordance with Section 4.3.2 of the Depositary Agreement. 

        (c)    Loss Proceeds.    Unless otherwise expressly provided herein or in the Depositary Agreement, Borrower shall
deposit, or cause to be deposited, all Loss Proceeds distributed to or otherwise received by Borrower in the Loss Proceeds Account to be applied in accordance with  Section 4.8.2 of the Depositary
Agreement. 

        5.2    Notices.    Borrower shall promptly, upon acquiring notice or giving notice, as the case may be, or obtaining
knowledge thereof, give written notice (together with copies of any underlying notices or other documentation) to Administrative Agent of: 

        5.2.1    Any
action, suit, arbitration or litigation pending or, to the best knowledge of Borrower, threatened against Borrower or any Equity Party and involving claims against
any such Person in excess of $4,000,000, in the case of Borrower, or $10,000,000, in the case of an Equity Party, in the aggregate per year or involving any injunctive, declaratory or other equitable
relief that, if adversely determined, would reasonably be expected to have a Borrower Material Adverse Effect, such notice to include, if reasonably requested by Administrative Agent, copies of all
material papers filed in such litigation involving Borrower or an Equity Party, and such notice to be given monthly if any such papers have been filed since the last notice given; 

        5.2.2    Any
dispute or disputes which may exist between Borrower or any Equity Party and any Governmental Authority and which involve (a) claims against any such Person
which exceed $4,000,000, in the case of Borrower, or $10,000,000, in the case of an Equity Party, in the aggregate per year, (b) injunctive or declaratory relief, or (c) any Liens (other
than Borrower Permitted Liens) relating to an Approved Project for taxes due but not paid; 

63

 

        5.2.3    Any
Borrower Event of Default or Borrower Inchoate Default, together with a description of any action being taken or proposed to be taken with respect thereto; 

        5.2.4    Any
matter which has had, or, in Borrower's reasonable judgment, would reasonably be expected to have, a Borrower Material Adverse Effect; 

        5.2.5    Promptly,
but in no event later than 30 days prior to any transfer of NEG's direct or indirect interests in Borrower, notice thereof, which notice shall
describe such transfer in reasonable detail; and 

        5.2.6    Any
receipt of or change in ratings given to any Equity Party, Borrower or the Obligations by Moody's or S&P, including the placement of any such Person on "credit
watch negative" or a similar status. 

        Notwithstanding
the foregoing, Borrower shall not be required give notice of any matter described in this Section 5.2 that is not
directly related to Borrower or any Equity Party and is described in any Form 10-K, 10-Q or 8-K or other form or document filed by Borrower or any of its
Affiliates with the Securities and Exchange Commission and available on the Commission's Electronic Data Gathering, Analysis and Retrieval (EDGAR) system, so long as Borrower provides Administrative
Agent with notice of such filing within the applicable time period set forth in this Section 5.2, including the location of the relevant matter
within such filing and a general description of such matter. 

        5.3    Financial Statements.    Borrower shall deliver or cause to be delivered to Administrative Agent, in form and
detail reasonably satisfactory to Administrative Agent: 

        (a)  As
soon as available and in any event within 60 days after the end of each of the first three quarters of the fiscal year of the applicable Person, a consolidated
balance sheet of each Equity Party and Borrower as of the end of such quarter and the related statements of income for such quarter and for the portion of the fiscal year ended at the end of such
quarter, and the related statement of cash flows for such quarter and for the portion of the fiscal year ended at the end of such quarter, in each case setting forth comparative figures for the
previous dates and periods, to the extent available, all certified (subject to normal year-end adjustments) as to fairness of presentation, GAAP and consistency by a Responsible Officer of
the applicable Person; 

        (b)  as
soon as available and in any event within 120 days after the end of each fiscal year of the applicable Person, an audited consolidated balance sheet of each
Equity Party and Borrower as of the end of such fiscal year and the related audited statements of income, retained earnings and cash flows for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal
year, to the extent available, all reported on by an independent public accountant of nationally recognized standing; and 

        (c)  each
time financial statements are delivered under Section 5.3(a) or  (b) above, along with such financial statements, a certificate signed by a Responsible
Officer of the applicable Person, certifying that such officer
has made or caused to be made a review of the transactions and financial condition of such Person during the relevant fiscal period and that such review has not, to the best of such Responsible
Officer's knowledge, disclosed the existence of any event or condition which constitutes a Borrower Event of Default or Borrower Inchoate Default, or if any such event or condition existed or exists,
the nature thereof and the corrective actions that such Person has taken or proposes to take with respect thereto, and also certifying that such Person is in compliance with all applicable material
provisions of each Credit Document to which such Person is a party or, if such is not the case, stating the nature of such non-compliance and the corrective actions which such Person has
taken or proposes to take with respect thereto; 

provided that Borrower shall not be required to provide any such financial statements to the extent the financial statements have been filed by the
applicable Person with the Securities and Exchange Commission and are available on the Commission's Electronic Data Gathering, Analysis and Retrieval 

64

 

(EDGAR) system, so long as Borrower provides Administrative Agent with notice of such filing within the applicable time period set forth in this  Section 5.3. 

        5.4    Inspection of Books and Records.    Borrower shall keep proper books of accounts and records in accordance with
GAAP and in compliance in all material respects with all applicable Legal Requirements and make the same available for inspection by Administrative Agent. 

        5.5    Compliance with Laws.    Borrower shall comply with all applicable Legal Requirements, except where
non-compliance would not reasonably be expected to have a Borrower Material Adverse Effect. 

        5.6    Existence, Conduct of Business, Etc.    Borrower shall (a) maintain and preserve its existence as a
limited liability company formed under the laws of the State of Delaware and all material rights, privileges and franchises necessary or desirable in the normal conduct of its business,
(b) engage only in the business contemplated by the Credit Documents and (c) perform all of its contractual obligations under the Credit Documents. 

        5.7    Calculation of Ratios.    

        5.7.1    Debt Service Coverage Ratio.    At least 10 days prior to each day on which the Debt Service Coverage
Ratio is required to be calculated hereunder, Borrower shall deliver to Administrative Agent a certificate in the form of  Exhibit C-6A with the calculation of the Debt Service Coverage Ratio as of
such required calculation date. Administrative Agent shall notify Borrower of any manifest errors in the calculation of the Debt Service Coverage Ratio within five days of receipt of Borrower's
certificate, and Borrower shall correct any such manifest errors. The Debt Service Coverage Ratio shall be calculated in a manner which is consistent with and supported by the conclusions set forth in
the most recently delivered Independent Consultants' reports, Independent Market Forecast and Base Case Project Projections. 

        5.7.2    Debt to Capitalization Ratio.    At least 10 days prior to each day on which the Debt to
Capitalization Ratio is required to be calculated hereunder, Borrower shall deliver to Administrative Agent a certificate in the form of  Exhibit C-6B with the calculation of the Debt to
Capitalization Ratio as of such required calculation date. Administrative Agent
shall notify Borrower of any manifest errors in the calculation of the Debt to Capitalization Ratio within five days of receipt of Borrower's certificate, and Borrower shall correct any such manifest
errors. The Debt to Capitalization Ratio shall be calculated in a manner which is consistent with and supported by the conclusions set forth in the most recently delivered Independent Consultants'
reports, Independent Market Forecast and Base Case Project Projections. Equity Contributions shall be included in the calculation of the Debt to Capitalization Ratio only to the extent such amounts
were used to pay Project Costs as specified in the Borrower Budget and/or the applicable Project Budget. 

        5.8    Indemnification.    

        5.8.1    (a) Borrower
shall indemnify, defend and hold harmless the Arrangers, Administrative Agent, the Depositary Agent, the LC Bank, each Bank, each Lender Group
Member, each Asset Securitization Company, each Liquidity Provider and each Hedge Bank, and in their capacities as such, their respective officers, directors, shareholders, controlling Persons,
affiliates, employees, agents and servants (collectively, the "Indemnitees") from and against any and all claims, obligations, liabilities, losses,
costs or expenses (including reasonable attorneys' fees and disbursements), penalties, actions and suits (other than with respect to any taxes or similar claims, the indemnification of which is
covered solely under Sections 2.5.4 and 2.7.3) which any of them may incur or which may be claimed
against any of them (collectively, "General Subject Claims"), in any way arising out of or in connection with this Agreement (including the execution,
delivery, enforcement, performance and administration of, and the syndication of Commitments under, this Agreement), the other Operative Documents, any of the transactions contemplated hereby or
thereby or any Project (including the actual or proposed use of proceeds of any Loans). 

65

 

        (b)  Without
limiting the generality of clause (a) above, Borrower further agrees to indemnify and hold harmless each Indemnitee from and against any and all claims,
losses, liabilities, suits, obligations, fines, damages, judgments, penalties, charges, costs and expenses (including reasonable attorneys' fees and disbursements) (whether civil or criminal, arising
under a theory of negligence or strict liability, or otherwise) which may be imposed on, incurred or paid by or asserted against such Indemnitee (collectively, "Environmental
Subject Claims" and, together with General Subject Claims, "Subject Claims") in connection with the Release or presence of any
Hazardous Substances at any Project or Site, whether foreseeable or unforeseeable, including all costs of removal and disposal of such Hazardous Substances, all reasonable costs required to be
incurred in (i) determining whether a Project
is in compliance and (ii) causing such Project to be in compliance, with all applicable Legal Requirements, all reasonable costs associated with claims for damages to Persons or property, and
reasonable attorneys' and consultants' fees and court costs. 

        5.8.2    The
foregoing indemnities shall not apply with respect to an Indemnitee to the extent that any Subject Claim is found by a final and non-appealable
decision of a court of competent jurisdiction to have resulted from the gross negligence or willful misconduct of such Indemnitee, but shall continue to apply to other Indemnitees. 

        5.8.3    Borrower
agrees that no Indemnitee shall have any liability (whether direct or indirect, in contract, tort or otherwise) to Borrower, any other Credit Party or any of
their respective shareholders, affiliates or creditors for or in connection with this Agreement, the other Operative Documents or any of the transactions contemplated hereby or thereby, except to the
extent such liability is found in a final, non-appealable court of competent jurisdiction to have resulted from such Indemnitee's gross negligence or willful misconduct. 

        5.8.4    The
provisions of this Section 5.8 shall survive foreclosure of the Collateral Documents and satisfaction or
discharge of the Credit Parties' obligations hereunder and under the other Credit Documents, and shall be in addition to any other rights and remedies of the Secured Parties. 

        5.8.5    In
case any action, suit or proceeding shall be brought against any Indemnitee, such Indemnitee shall notify Borrower of the commencement thereof, and Borrower shall
be entitled, at its expense, acting through counsel reasonably acceptable to such Indemnitee, to participate in, and, to the extent that Borrower desires, to assume and control the defense thereof;  provided, however, that Borrower shall not settle or compromise any Subject Claim on behalf of such
Indemnitee without such Indemnitee's prior written consent (a) unless such settlement or compromise includes an unconditional release of such Indemnitee from, and holds such Indemnitee harmless
against, all liability arising out of such claim, action, proceeding or investigation or (b) if the settlement or compromise involves any non-monetary relief to be performed, or
admission of guilt or wrongdoing, by such Indemnitee. Such Indemnitee shall be entitled, at its expense, to participate in any action, suit or proceeding the defense of which has been assumed by
Borrower. Notwithstanding the foregoing, Borrower shall not be entitled to assume and control the defense of any such action, suit or proceedings if and to the extent that, in the reasonable opinion
of such Indemnitee and its counsel, such action, suit or proceeding involves the potential imposition of criminal liability upon such Indemnitee or a conflict of interest between such Indemnitee and
Borrower or between such Indemnitee and another Indemnitee (unless such conflict of interest is waived in writing by the affected Indemnitees), and in such event (other than with respect to disputes
between such Indemnitee and another Indemnitee) Borrower shall pay the reasonable expenses of such Indemnitee in such defense. 

        5.8.6    Upon
payment of any Subject Claim by Borrower pursuant to this Section 5.8 or other similar indemnity provisions
contained herein to or on behalf of an Indemnitee, Borrower, without any further action, shall be subrogated to any and all claims that such Indemnitee may have 

66

 

relating thereto, and such Indemnitee shall cooperate with Borrower and give such further assurances as are necessary or advisable to enable Borrower vigorously to pursue such claims. 

        5.8.7    Any
amounts payable by Borrower pursuant to this Section 5.8 shall be regularly payable within 30 days
after Borrower receives an invoice for such amounts from any applicable Indemnitee, and if not paid within such 30-day period shall bear interest at the Default Rate. 

        5.8.8    Notwithstanding
anything to the contrary set forth herein, Borrower shall not, in connection with any one legal proceeding or claim, or separate but related
proceedings or claims arising out of the same general allegations or circumstances, in which the interests of the Indemnitees do not materially differ, be liable to the Indemnitees (or any of them)
under any of the provisions set forth in this Section 5.8 for the fees and expenses of more than one separate firm of attorneys (which firm shall
be selected by the affected Indemnitees, or upon failure to so select, by Administrative Agent), exclusive of any appropriate local counsel. 

        5.8.9    If,
for any reason whatsoever, the indemnification provided under this Section 5.8 is unavailable to any
Indemnitee or is insufficient to hold it harmless to the extent provided in this Section 5.8, then provided such payment is not prohibited by or
contrary to any applicable Legal Requirement or public policy, Borrower shall contribute to the amount paid or payable by such Indemnitee as a result of the Subject Claim in such proportion as is
appropriate to reflect the relative economic interests of Borrower and its Affiliates on the one hand, and such Indemnitee on the other hand, in the matters contemplated by this Agreement as well as
the relative fault of Borrower (and its Affiliates) and such Indemnitee with respect to such Subject Claim, and any other relevant equitable considerations. 

        5.8.10    Notwithstanding
anything to the contrary set forth herein, no Lender Group Member, Asset Securitization Company or Liquidity Provider shall receive any greater amount
under this Section 5.8 than it would have received had it been a Bank. Any amounts not paid by operation of the limitations set forth in  Sections 2.5.4, 2.7.3, 2.7.4 and  2.8 shall not be recoverable under this Section 5.8. 

        5.9    Further Assurances.    

        5.9.1    Borrower
shall preserve the security interests in the Borrower Collateral and upon request by Administrative Agent undertake all actions which are necessary or
advisable or which are reasonably requested by Administrative Agent to (a) maintain Administrative Agent's security interest in the Borrower Collateral in full force and effect at all times
(including the priority thereof), and (b) preserve and protect the Borrower Collateral and protect and enforce Borrower's rights and title and the rights of Administrative Agent to the Borrower
Collateral, including the making or delivery of all filings and recordations, the payment of fees and other charges and the issuance of supplemental documentation. 

        5.9.2    Borrower
shall perform such reasonable acts as may be necessary to carry out the intent of this Agreement and the other Credit Documents. 

        5.9.3    Without
limiting the generality of Section 5.9.1, Borrower shall cause the equity interests in the Approved
Project Companies and the Approved Intermediate Holding Companies to be "certificated securities" as defined in Article 8 of the UCC. 

        5.9.4    Notwithstanding
anything in this Agreement or any other Credit Document to the contrary, Borrower shall not be required to enforce its rights or exercise its remedies
under the Building Loan Documents. 

67

   
        5.10    Market Forecasts.    Borrower shall furnish or cause to be furnished to Administrative Agent no later than
three months prior to the expected Last Completion Date (according to the Project Schedules) and on or prior to each anniversary of the actual Last Completion Date thereafter, a forecast (an
"Independent Market Forecast") prepared by the Power Market Consultant or another independent nationally recognized forecasting consultant reasonably
acceptable to Administrative Agent, which forecasts (a) electricity prices for the markets relevant to the Approved Projects and (b) gas prices on a delivered basis to the Approved
Projects, in each case on at least an annual basis through the period set forth in the Base Case Project Projections most recently delivered hereunder. In preparing any projections for purposes of
calculating the Debt Service Coverage Ratio, Borrower shall use the most recently prepared Independent Market Forecast. 

        5.11    Revenue Payments to Borrower.    Borrower shall cause the Approved Project Companies to distribute all Project
Revenues, Loss Proceeds and other amounts received by the Approved Project Companies to Borrower and shall deposit such amounts into the applicable Accounts in accordance with the Depositary
Agreement. 

        5.12    Taxes.    Borrower shall pay and discharge promptly when due all material taxes and governmental charges
imposed upon it or upon its income or profits or in respect of its property, in each case before the same shall become delinquent or in default and before penalties accrue thereon, unless and to the
extent the same are being contested in good faith by appropriate proceedings and adequate reserves with respect thereto shall, to the extent required by GAAP, have been set aside, and failure to pay
or comply with the contested item would not reasonably be expected to have a Borrower Material Adverse Effect. 

        5.13    Interest Rate Protection.    

        5.13.1    Compliance with Interest Rate Agreements.    

        (a)  Within
30 days after the Initial Credit Event Date for each Approved Project, Borrower shall enter into with one or more Hedge Banks one or more Interest Rate
Agreements in a notional amount equal to at least 50% of the Allocated Portion of the Total Construction Loan Commitment for such Approved Project through the scheduled Final Maturity Date and,
thereafter, at all times comply with and maintain in full force and effect such Interest Rate Agreements. 

        (b)  In
the event that the yield on 10-year U.S. Treasury Bonds exceeds 8.50% for five consecutive Banking Days, within 10 Banking Days of such date, Borrower
shall enter into with one or more Hedge Banks one or more Interest Rate Agreements in a notional amount equal to, when combined with the notional amounts under the Interest Rate Agreements entered
into pursuant to clause (a) of this Section 5.13.1, at least 90% of the Allocated Portions of the Total Construction Loan Commitment for
all Approved Projects through the scheduled Final Maturity Date and, thereafter, at all times comply with and maintain in full force and effect such Interest Rate Agreements. 

        5.13.2    Hedge Breaking Fees.    To the extent required pursuant to the terms of the Hedge Transactions, Borrower
shall pay all costs, fees and expenses incurred by the Hedge Banks in connection with any unwinding, breach or termination of such Hedge Transactions ("Hedge Breaking
Fees"), all to the extent provided in and as calculated pursuant to the applicable Interest Rate Agreements. 

        5.13.3    Security.    Each Interest Rate Agreement provided by a Hedge Bank hereunder, including all Hedge
Transactions thereunder entered into in accordance with the terms of this Agreement, and all Hedge Breaking Fees shall be and are hereby secured by the Collateral Documents,  pari passu with the Loans.
The parties hereto agree that, for purposes of the sharing of Collateral and voting on the exercise of remedies under the
Credit Documents, each Hedge Bank, in its capacity as such, shall be deemed to have a Proportionate Share equal to the amount 

68

 

of Hedge Breaking Fees that would be owed by Borrower to such Hedge Bank under any Hedge Transaction if an Early Termination Date (as defined in the applicable Interest Rate Agreement) were to occur
on the date of determination of such Proportionate Share. 

        5.13.4    Bank Participation.    At the election of the Hedge Bank party to any Interest Rate Agreement, the Banks and
the Lender Groups may participate in such Interest Rate Agreement and the Hedge Transactions thereunder in proportion to (i) in the case of the Banks, their respective Proportionate Shares and
(ii) in the case of a Lender Group, such Lender Group's Proportionate Share, by means of a risk sharing agreement in form and substance reasonably satisfactory to the participating Banks and
Lender Groups, provided that if the lending office of any such Bank or any applicable Lender Group Member is in the State of New York, such Bank or such
Lender Group Member may designate another branch to enter into such risk sharing agreement. 

        5.14    Intercompany Loans.    Borrower shall cause all Debt issued by a Credit Party to another Credit Party (other
than pursuant to the Building Loan Agreement) to be evidenced by an Intercompany Note, and shall cause such Intercompany Note to be included in the Collateral and the original thereof to be promptly
delivered to Administrative Agent. 

ARTICLE 6.
  NEGATIVE COVENANTS OF BORROWER  

        Borrower covenants and agrees that, so long as any of the Commitments shall remain in effect and until payment and performance in full of all of the Obligations,
Borrower shall perform the covenants set forth in this Article 6 (unless waived in accordance with  Section 9.9 of this Agreement). 

        6.1    Contingent Liabilities.    Except for the consummation of the transactions pursuant to this Agreement and the
other Credit Documents, Borrower shall not become liable as a surety, guarantor, accommodation endorser or otherwise, for or upon the obligation of any other Person;  provided, however, that this Section 6.1 shall
not be deemed to prohibit the incurrence, creation, assumption or existence of Borrower Permitted Debt. 

        6.2    Limitations on Liens.    Borrower shall not create, assume or suffer to exist any Lien securing a charge or
obligation on any properties or assets of Borrower, real or personal, whether now owned or hereafter acquired, except Borrower Permitted Liens. 

        6.3    Indebtedness.    Borrower shall not incur, create, assume or permit to exist any Debt, except Borrower
Permitted Debt. 

        6.4    Sale of Assets.    (a) Borrower shall not sell, lease, assign, transfer or otherwise dispose of any of
its properties or assets, whether now owned or hereafter acquired, except that (x) Borrower may assign any Interest Rate Agreement in accordance with the terms thereof so long as following such
assignment Borrower continues to be in compliance with Section 5.13, and (y) on or after March 31, 2002, Borrower may transfer 100%
(but not less than 100%) of its direct and indirect interests in any Approved Project Company to any other Person (other than a Credit Party) if the following conditions are satisfied at the time of
the proposed transfer: 

          (i)  no
Borrower Event of Default, Borrower Inchoate Default, Project Event of Default (except with respect to the Approved Project Company being transferred) or Project
Inchoate Default (except with respect to the Approved Project Company being transferred) shall exist as of the date of the proposed transfer; 

        (ii)  Administrative
Agent shall have received written confirmation from each Rating Agency that the ratings assigned to the Obligations after giving effect to the proposed
transfer will be at least Baa3 in the case of Moody's and at least BBB- in the case of S&P; 

69

 

        (iii)  Borrower
shall (A) prepay Construction Loans (with amounts other than amounts in any Account or otherwise constituting Collateral, which amounts may include the
proceeds of the proposed transfer) in an amount such that, after giving effect to the proposed transfer and such prepayment, the minimum and average annual projected Debt Service Coverage Ratios for
the Approved Projects (taken as a whole and not including the Approved Project being transferred) over the period set forth in the Base Case Project Projections most recently delivered hereunder are
not less than (1) if there are two Approved Projects after giving effect to the proposed transfer, 2.25 to 1.0 and 3.25 to 1.0, respectively, and (2) if there are three Approved Projects
after giving effect to the proposed transfer, 2.0 to 1.0 and 3.0 to 1.0, respectively, and (B) prepay all Working Capital Loans and Project LC Loans made in respect of the Approved Project
being transferred; 

        (iv)  after
giving effect to the proposed transfer, the Debt to Capitalization Ratio (excluding the Approved Project Company being transferred in the calculation thereof)
shall be no greater than the Maximum Debt to Capitalization Ratio; 

        (v)  after
giving effect to the proposed transfer, (A) there shall be at least two Approved Projects and (B) if the proposed transfer occurs prior to the Last
Completion Date, at least one of the Approved Projects shall be the Millennium Project; 

        (vi)  after
giving effect to the proposed transfer and the prepayment of Loans described in clause (iii) above, the Available Construction Funds for all Approved
Projects shall, in the reasonable judgment of Administrative Agent and the Independent Engineer, be equal to or exceed the remaining Project Costs for all Approved Projects; 

      (vii)  after
giving effect to the proposed transfer, no event or condition shall exist that would reasonably be expected to have a Borrower Material Adverse Effect; 

      (viii)  all
Debt owed by the Approved Project Company being transferred to any other Credit Party and all Debt owed by any Credit Party to the Approved Project Company being
transferred shall be repaid in full; 

        (ix)  the
proposed transfer shall be effected by a transfer by Borrower of its interests in the applicable Approved Intermediate Holding Companies; 

        (x)  the
proposed transfer shall be made pursuant to documentation consistent with the foregoing conditions in form and substance reasonably satisfactory to Administrative
Agent; and 

        (xi)  Borrower
shall have delivered to Administrative Agent a certificate, in form and substance reasonably satisfactory to Administrative Agent, stating that each of the
conditions set forth in this Section 6.4. have been satisfied and setting forth the Total Equity Commitment after giving effect to the proposed
transfer, and the Majority Banks do not object in writing to the accuracy of such certification within 15 Banking Days after delivery of such certificate and other supporting documents as Borrower and
Administrative Agent may agree to the Banks and the Lender Groups. 

        (b)  If
Borrower is permitted to transfer its direct or indirect equity interests in an Approved Project Company pursuant to clause (a), Administrative Agent shall
take all actions reasonably requested by Borrower in writing in order to (i) release the Liens of Administrative Agent on the equity interests in such Approved Project Company and the
applicable Approved Intermediate Holding Companies and on the associated Approved Project and Project Documents (including the execution of UCC-3 termination statements and deeds of
reconveyance), (ii) release such Approved Project Company from its Project Company Guaranty in accordance with the terms thereof and (iii) release NEG from the applicable NEG EPC
Guaranty (if any) and the Millennium O&M Cost Contribution Agreement (in the case of the Millennium Project) in accordance with the terms thereof. Upon the 

70

 

releases of such Approved Project Company, Approved Intermediate Holding Companies and Approved Project described in the immediately preceding sentence, such Approved Project Company, Approved
Intermediate Holding Companies and Approved Project shall cease to be an Approved Project Company, Approved Intermediate Holding Companies and an Approved Project, as the case may be, for purposes of
this Agreement and the other Credit Documents. 

        6.5    Nature of Borrower's Business.    Borrower shall not change the nature of its business or expand its business
beyond the business contemplated in the Credit Documents. Without limiting the generality of the foregoing, (a) Borrower shall not enter into any Project Document, (b) Borrower shall not
hold any equity, voting or other interest in any Person other than the Approved Intermediate Holding Companies, (c) Borrower shall not own or lease any material assets other than its equity
interests in the Approved Intermediate Holding Companies and Permitted Investments in accordance with Article V of the Depositary Agreement and
(d) Borrower shall not have any employees. 

        6.6    Distributions.    

        6.6.1    Other
than (w) the making of In Kind Equity Payments, Equity Contribution True-Up Reimbursements and NEG EPC Guaranty Reimbursements in accordance
with the proviso to Section 5.1.1(a) hereof, (x) the making of Excess Cash Flow Contributions in accordance with  Section 4.2.2 of the
Depositary Agreement, (y) the distribution of Divestiture Profits and (z) the making of Other Proceeds
Contributions in accordance with Section 4.8.2(d)(ii) of the Depositary Agreement, Borrower shall not directly or indirectly make or declare any
distribution (in cash, property or obligation) on, or make any other payment on account of, any interest in Borrower or any other Credit Party (including transfers of any tax benefits), or make any
payment on account of subordinated obligations (including Subordinated Affiliate Fees) (a "Restricted Payment"), unless: 

          (i)  no
Borrower Event of Default or Borrower Inchoate Default has occurred and is continuing and such Restricted Payment will not result in a Borrower Event of Default or
Borrower Inchoate Default; 

        (ii)  the
amount of such Restricted Payment does not exceed the sum of (A) the aggregate of all Attributed Distributable Cash as of the proposed Restricted Payment
Date for the Approved Project Companies with respect to which no Project Event of Default or Project Inchoate Default has occurred and is continuing or would result from such Restricted Payment,  plus
(B) the aggregate of all Attributed Distributable Cash as of any previous Restricted Payment Date for the Approved Project Companies with
respect to which no Project Event of Default or Project Inchoate Default has occurred and is continuing or would result from such Restricted Payment that (x) was required to be retained in the
Distribution Account on such previous Restricted Payment Date, (y) remains on deposit in the Distribution Account and (z) is not required to be used to prepay Loans as contemplated by
the last sentence of Section 4.7.2 of the Depositary Agreement; 

        (iii)  both
the Amortization Commencement Date and the Last Completion Date have occurred as of the proposed Restricted Payment Date; 

        (iv)  there
are no outstanding Working Capital Loans, Project LC Loans, DSR LC Loans or Reimbursement Obligations under the Letters of Credit as of the proposed Restricted
Payment Date; 

        (v)  the
Obligations are rated at least Baa3 by Moody's and at least BBB- by S&P as of the proposed Restricted Payment Date; 

        (vi)  as
of the proposed Restricted Payment Date, the cash and Permitted Investments on deposit in the Debt Service Reserve Account, together with the then current Stated
Amount of the DSR Letter of Credit (if any), shall equal or exceed the DSR Required Balance; 

71

 

      (vii)  such
Restricted Payment is made from Account Funds in the Distribution Account in accordance with Section 4.7.2
of the Depositary Agreement; 

      (viii)  no
Borrower Material Adverse Effect has occurred and is continuing or would reasonably be expected to occur as a result of such Restricted Payment; 

        (ix)  (A)
the historical Debt Service Coverage Ratio for the Approved Projects (taken as a whole) for the 12 months immediately preceding the Quarterly Date that is on
or immediately preceding the proposed Restricted Payment Date (or such shorter period beginning on the Last Completion Date and ending on such Quarterly Date) is equal to or greater than 1.7 to 1.0,
and (B) the projected Debt Service Coverage Ratio for the Approved Projects (taken as a whole) for the 24 months immediately following such Quarterly Date equal to or greater than 1.7 to
1.0; 

        (x)  the
Representative Equivalent Availability Factor shall have been equal to or greater than 88% during any one Availability Determination Period occurring prior to the
proposed Restricted Payment Date, and Borrower shall have satisfied the following information delivery requirements in connection therewith: 

        (A)  Borrower
shall have made available to Administrative Agent, no more than 30 days after each Quarterly Date occurring in such Availability Determination Period, a
written calculation of the Representative Equivalent Availability Factor during the quarter ending on such Quarterly Date, together with such data and documentation as reasonably requested by
Administrative Agent to verify such Representative Equivalent Availability Factor, including sufficient data to verify the duration of a forced or planned derate to the nearest hour
(provided that Borrower shall not be required to provide Administrative Agent with an hour-by-hour calculation of any given
derated situation, but rather shall be required to provide Administrative Agent with appropriate trend plots or other suitable alternative which clearly shows the magnitude and time duration of the
derate); and 

        (B)  for
any Allowance Hours included in the calculation of such Representative Equivalent Availability Factor, Borrower shall have provided to Administrative Agent, at least
5 days prior to the applicable outage (or such shorter period agreed to by Administrative Agent), a written outage plan specifying the following: (1) the projected duration of the
outage; (2) the work to be performed during the outage; (3) the projected cost to complete the outage; and (4) the projected performance benefit from the work to be performed
during the outage; 

        (xi)  Borrower
shall have delivered to Administrative Agent, at least five Banking Days prior to the proposed Restricted Payment Date, as-built A.L.T.A. surveys
of the Site (in form and substance as required in Section 3.2.22) with respect to each Approved Project (or such other documentation reasonably
acceptable to Administrative Agent), in form and substance reasonably satisfactory to Administrative Agent and the Title Insurer, certified to Administrative Agent as to completeness and accuracy by a
licensed surveyor reasonably satisfactory to Administrative Agent, showing (A) as to such Site, the exact location and dimensions thereof, including the location of all means of access thereto
and all Easements relating thereto and showing the perimeter within which all foundations are located; (B) as to such Easements, the exact location and dimensions thereof, including the
location of all means of access thereto from such Approved Project, and all improvements or other encroachments in or on such Easements burdening such Approved Project; (C) the location and
dimensions of all improvements, fences or encroachments located in or on such Site or such Easements; (D) that the location of such Approved Project does not encroach on or interfere with
adjacent property or existing easements or other rights, whether on, above or below ground (or if the location of such Approved Project does encroach on or interfere with adjacent 

72

 

property or existing easements or other rights, such encroachment or interference is reasonably acceptable to Administrative Agent); (E) any gaps, gores, projections or protrusions at the
Site; and (F) whether such Site or any portion thereof is located in a special earthquake or flood hazard zone; provided,  however, that the matters
described in clauses (B) and (F) may be shown by separate maps, surveys or other manner reasonably satisfactory
to Administrative Agent; and 

      (xii)  Borrower
shall have delivered to Administrative Agent, at least five Banking Days prior to the proposed Restricted Payment Date, a certificate (which certificate shall
demonstrate in reasonable detail compliance with the conditions set forth in clause (ix) above), dated as of the proposed Restricted Payment Date and duly executed by a Responsible Officer of
Borrower, certifying to the effect that each of the foregoing conditions shall have been satisfied as of such date; 

provided, however, that even if not all of the foregoing conditions have been satisfied as of the
proposed Restricted Payment Date, Borrower may make distributions for Federal, state or local income tax payments in an amount not to exceed the amount that Borrower, the Approved Intermediate Holding
Companies and the Approved Project Companies would be required to pay if such Persons were tax paying entities forming a consolidated group for Federal income tax purposes or a similar consolidated,
combined or unitary group for state or local income tax purposes, which amount shall be assumed to equal the product of (A) the net income of such group for Federal, state of local income tax
purposes multiplied by (B) the highest marginal Federal, state or local income tax rate at the time applicable to "C" corporations, so long as
(1) no Borrower Event of Default or Borrower Inchoate Default has occurred and is continuing or would result from such distributions and (2) each of Borrower, the Approved Intermediate
Holding Companies and the Approved Project Companies is then treated as a pass-through entity or a Subsidiary of an affiliated group of corporations filing a consolidated, combined or
unitary return for Federal, state or local income tax purposes and such Person's income is included in the taxable income of PG&E Corporation or any other entity within the PG&E Corporation affiliate
group of corporations. 

        6.6.2    Notwithstanding
anything set forth in Section 6.6.1, Borrower shall not make any Restricted Payments other than
on Quarterly Dates (or within 10 Banking Days thereafter) in accordance with the terms of Section 4.7.2 of the Depositary Agreement. 

        6.6.3    (a)
Notwithstanding any provision of this Agreement or any other Credit Document to the contrary (including  Article III and Section 6.6.1 hereof and
 Section 5.7 and 5.8 of the applicable Project Company Guaranties), each of Covert Generating Company, LLC and Harquahala Generating Company, LLC
(if such Project Company is an Approved Project Company) shall be permitted to reimburse NEG if and to the extent that (i) NEG is entitled to payment pursuant to  Section 1(g) or 3(b) of the applicable NEG EPC Guaranty or (ii) such Approved Project
Company receives more than 100% of any liquidated damage payment to which it is entitled pursuant to the terms of the applicable Construction Contracts, Equipment Supply Contracts, EPC Support
Documents and/or Equipment Support Documents (other than the NEG EPC Guaranty). Amounts reimbursable to NEG as described in clauses (i) and (ii) above shall (A) if paid prior to
Completion of the applicable Approved Project, constitute Project Costs for such Approved Project, and (B) if paid at or after Completion of the
applicable Approved Project, constitute O&M Costs for such Approved Project. Each of Covert Generating Company, LLC and Harquahala Generating Company, LLC shall be permitted to reimburse NEG as
contemplated by clause (i) of this Section 6.6.3(a) notwithstanding the earlier termination of the applicable NEG EPC Guaranty in
accordance with its terms. Any reimbursement to NEG contemplated by clause (i) of this Section 6.6.3(a) that is made prior to the
termination of the applicable NEG EPC Guaranty shall be subject to the reinstatement of the amount available under such NEG EPC 

73

 

Guaranty by the amount of such reimbursement. Any reimbursement to NEG contemplated by clause (i) of this Section 6.6.3(a) that is made
after the termination of the applicable NEG EPC Guaranty shall be reduced by the amount of any claims that were made under such NEG EPC Guaranty prior to such termination but were not paid solely
because of NEG's limitation on liability thereunder. 

        (b)  Notwithstanding
any provision of this Agreement or any other Credit Document to the contrary (including  Article III and Section 6.6.1 hereof and  Section 5.7 and 5.8 of the applicable Project Company Guaranties), Millennium Power Partners,
L.P. (if Millennium Power Partners, L.P. is an Approved Project Company) shall be permitted to reimburse NEG if and to the extent that NEG is entitled to payment pursuant to  Section 2(b) of the
Millennium O&M Cost Contribution Agreement. Amounts reimbursable to NEG as described in the preceding sentence shall
constitute O&M Costs for the Millennium Project. Millennium Power Partners, L.P. shall be permitted to reimburse NEG as contemplated by this  Section 6.6.3(b) notwithstanding the earlier
termination of the Millennium O&M Cost Contribution Agreement in accordance with its terms. Any
reimbursement to NEG contemplated by this Section 6.6.3(b) that is made prior to the termination of the Millennium O&M Cost Contribution
Agreement shall be subject to the reinstatement of the amount available under the Millennium O&M Cost Contribution Agreement by the amount of such reimbursement. Any reimbursement to NEG contemplated
by this Section 6.6.3(b) that is made after the termination of the Millennium O&M Cost Contribution Agreement shall be reduced by the amount of
any claims that were made under the Millennium O&M Cost Contribution Agreement prior to such termination but were not paid solely because of NEG's limitation on liability thereunder. 

        6.7    Investments.    Borrower shall not make any investments (whether by purchase of stocks, bonds, notes or other
securities, loan, extension of credit, advance or otherwise), other than Permitted Investments, cash equity contributions to the Approved Intermediate Holding Companies and the Approved Project
Companies, and the on-lending of Loan proceeds to the Approved Intermediate Holdings Companies and the Approved Project Companies. 

        6.8    Transactions With Affiliates.    Borrower shall not enter into any transaction or agreement (or any transaction
under or pursuant to any transaction or agreement) with any of its Affiliates, other than (a) transactions under the Credit Documents, (b) transactions or agreements between or among
only the Credit Parties, (c) transactions or agreements that are entered into in the ordinary course of business on fair and reasonable terms certified by a Responsible Officer of Borrower as
no less favorable to Borrower than Borrower would obtain in an arm's-length transaction with a Person that is not an Affiliate of Borrower, or (d) transactions or agreements approved in writing
by the Majority Banks. 

        6.9    Margin Stock Regulations.    Borrower shall not directly or indirectly apply any Loan proceeds, Equity
Contributions, Letter of Credit proceeds or Project Revenues to the "buying", "carrying" or "purchasing" of any margin stock within the meaning of Regulation T, U or X of the Board of Governors
of the Federal Reserve System or any regulations, interpretations or rulings thereunder. 

        6.10    ERISA.    Borrower shall not establish, maintain, contribute to or become obligated to contribute to any ERISA
Plan or suffer or permit any of its Subsidiaries to do so. 

        6.11    Dissolution.    Borrower shall not enter into any transaction of merger or consolidation, change its form of
organization or its business, liquidate or dissolve itself (or suffer any liquidation or dissolution), amend its governing instruments in any material respect or purchase or otherwise acquire all or
substantially all of the assets of any other Person (other than the purchase of equity interests in an Approved Intermediate Holding Company or Approved Project Company). 

74

 

        6.12    Accounts.    Borrower shall not maintain, establish or use any bank, deposit or securities accounts other than
(a) the Accounts, (b) the local checking accounts described in Article IV of the Depositary Agreement and (c) any Cash
Secured Advance Account. 

        6.13    Name and Location; Fiscal Year.    Borrower shall not (a) change its name without Administrative
Agent's prior written consent, (b) change the location of its principal place of business or its organizational identification number without notice to Administrative Agent at least
30 days prior to such change, or (c) change its fiscal year without Administrative Agent's prior written consent. 

        6.14    Assignment.    Borrower shall not assign its rights hereunder or under any of the other Credit Documents,
except as expressly permitted under this Agreement and the other Credit Documents. 

        6.15    Borrower Budget Amendments.    Borrower shall not amend, reallocate or otherwise modify, or permit the
amendment, reallocation or other modification of, the Borrower Budget, other than pursuant to Section 3.2.21(c). 

ARTICLE 7.
  EVENTS OF DEFAULT; REMEDIES  

        7.1    Events of Default.    The occurrence of any of the following events shall constitute an event of default
("Borrower Events of Default") hereunder: 

        7.1.1    Failure to Make Payments.    Borrower shall fail to pay, in accordance with the terms of this Agreement,
(a) any principal of any Loan or any Reimbursement Obligation on the date that such sum is due, (b) any interest on any Loan or Reimbursement Obligation or any scheduled fee, cost,
charge or sum due hereunder or under the other Credit Documents within five Banking Days after the date that such sum is due, or (c) any other fee, cost, charge or other sum due hereunder
(including pursuant to Section 5.8) or under the other Credit Documents within 10 Banking Days after the date that such sum is due. 

        7.1.2    Judgments.    One or more final judgments for the payment of money (if such payments are not fully covered by
insurance) in excess of $10,000,000 in the aggregate shall be rendered against Borrower, and Borrower shall not discharge the same or provide for its discharge in accordance with its terms, or procure
a stay of execution thereof, within 60 days after the date of entry thereof; provided, however,
that any such judgment or order shall not be (and shall not constitute part of) a Borrower Event of Default under this Section 7.1.2 if and for
so long as (i) the amount of such judgment or order is fully covered by a valid and binding policy of insurance between the defendant and the insurer covering payment thereof and
(ii) such insurer has been notified of, and has not disputed the claim made for payment of, the amount of such judgment or order. 

        7.1.3    Misstatements; Omissions.    Any representation or warranty by Borrower set forth in this Agreement or in any
other Operative Document or in any document entered into in connection herewith or therewith or in any certificate, financial statement or other document delivered in connection herewith or therewith
shall prove to have been incorrect in any material respect when made (or deemed made) and shall remain uncured or uncorrected for a period of 30 days (or so long as such incorrect
representation or warranty is curable and Borrower is diligently proceeding to cure such incorrect representation or warranty, such longer period but in no event for an aggregate period in excess of
90 days) after a Responsible Officer of Borrower first obtained actual knowledge of such material inaccuracy or Borrower first received a notice from Administrative Agent specifying such
material inaccuracy and requiring it to be remedied. 

75

 

        7.1.4    Bankruptcy; Insolvency.    Borrower shall become subject to a Bankruptcy Event. 

        7.1.5    Debt Cross Default.    Borrower shall default for a period beyond any applicable grace period (a) in
the payment of any principal, interest or other amount due under any agreement involving the borrowing of money or the advance of credit and the outstanding amount or amounts payable under all such
agreements equals or exceeds $10,000,000 in the aggregate, or (b) in the payment of any amount or performance of any obligation due under any guarantee or other agreement if pursuant to such
default, the holder of the relevant obligation accelerates the maturity of indebtedness evidenced thereby which equals or exceeds $10,000,000 in the aggregate for all such agreements. 

        7.1.6    ERISA.    (a) Borrower shall engage in any "prohibited transaction" (as defined in Section 406
of ERISA or Section 4975 of the Code) involving any ERISA Plan, or (b) any "accumulated funding deficiency" (as defined in Section 302 of ERISA), whether or not waived, shall
exist with respect to any ERISA Plan of Borrower, or (c) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be
appointed, to administer or to terminate any Single Employer Plan of Borrower, which Reportable Event or institution of proceedings is, in the reasonable opinion of Administrative Agent, likely to
result in the termination of such Single Employer Plan for purposes of Title IV of ERISA, or (d) any Single Employer Plan of Borrower shall terminate for purposes of Title IV of ERISA, and in
each case such event or condition, together with all other such events or conditions, if any, would reasonably be expected to have a Borrower Material Adverse Effect. 

        7.1.7    Breach of Terms of Credit Documents.    

        (a)  Borrower
shall fail to perform or observe any of the covenants or other agreements set forth in Section 3.15
(Committed Equity Contributions), 5.1 (Use of Proceeds and Revenues), 5.6(a) (Maintenance of Existence),  5.11 (Revenue Payments) or Article 6 (other than  Section 6.7 (Investments), 6.8 (Transactions
with Affiliates),  6.9 (Margin Regulations), 6.10 (ERISA), 6.12 (Accounts),  6.13 (Change of Name, etc.) or 6.15 (Borrower Budget Amendments));
provided that (i) Borrower's failure to perform or observe the covenants set forth in  Section 3.15 shall not become a Borrower Event of Default
if the Equity Party fully performs its corresponding obligations under the applicable
Equity Document within the applicable time periods set forth therein, and (ii) in the case where Borrower's failure to perform or observe the covenants set forth in  Section 5.1 is not an
intentional failure, such failure shall not become a Borrower Event of Default unless Borrower does not cure such failure
within three Banking Days after the occurrence of such failure. 

        (b)  Borrower
shall fail to perform or observe any of the covenants or other agreements set forth in Section 5.2.3
(Default Notices), 6.7 (Investments), 6.8 (Transactions with Affiliates),  6.9 (Margin Regulations),
6.10 (ERISA), 6.12 (Accounts),  6.13 (Change of Name, etc.) or 6.15 (Borrower Budget Amendments) and such failure shall continue
unremedied for a period of 30 days after Borrower becomes aware thereof or receives written notice thereof from Administrative Agent. 

        (c)  Borrower
shall fail to perform or observe any of the covenants or other agreements set forth hereunder or in any other Credit Document which are not otherwise
specifically provided for in Section 7.1.7(a) or (b) or elsewhere in this  Article 7 and such
failure shall continue unremedied for a period of 30 days after Borrower becomes aware thereof or receives written
notice thereof from Administrative Agent; provided, however, if (i) such failure does not consist
of a failure to pay money and cannot be cured within such 30 day period, (ii) such failure is susceptible of cure within 90 days, (iii) Borrower is proceeding with
diligence and in good faith to cure such failure, (iv) the existence of such failure has not had and cannot after considering the nature of the cure be reasonably expected to have a 

76

 

Borrower Material Adverse Effect, and (v) Administrative Agent shall have received an officer's certificate signed by a Responsible Officer of Borrower to the effect of clauses (i), (ii),
(iii) and (iv) above and stating what action Borrower is taking to cure such failure, then such 30 day cure period shall be extended to such date, not to exceed a total of
90 days, as shall be necessary for Borrower diligently to cure such failure. 

        7.1.8    Loss of Exemption.    Borrower or any Equity Party shall become subject to, or not exempt from, regulation
under the FPA or PUHCA, other than Section 9(a)(2) of PUHCA (except to the extent that the FPA or PUHCA is applicable to Borrower or such Equity Party solely by reason of the Approved Project
Companies being Exempt Wholesale Generators under PUHCA or being "public utilities", "electric utilities" or "transmitting utilities" under the FPA), and such regulation, or loss of exemption from
regulation, shall have a Borrower Material Adverse Effect; provided that Borrower or such Equity Party, as the case may be, shall have 30 days to
cure such event before it becomes a Borrower Event of Default so long as the extension of time to cure such event would not reasonably be expected to have a Borrower Material Adverse Effect. 

        7.1.9    Borrower Collateral.    (a) The grant of the Lien of any of the Borrower Collateral Documents shall
fail in any material respect to provide a perfected Lien in favor of Administrative Agent for the benefit of the Secured Parties on any of the Borrower Collateral with the priority purported to be
created thereby, and Borrower shall fail to cure any such failure within 15 days after Borrower becomes aware thereof or receives written notice thereof from Administrative Agent, or
(b) Administrative Agent shall receive a Secretary of State Report indicating that Administrative Agent's security interest in any of the Borrower Collateral is not prior to all other security
interests or other interests reflected in such report, other than Borrower Permitted Liens, and Borrower shall fail to cure such condition within 15 days after Borrower becomes aware thereof or
receives written notice thereof from Administrative Agent. 

        7.1.10    Loss of Control.    (a) NEG shall fail to (i) directly or indirectly own more than 50% of the
equity interests in Borrower and (ii) control the fundamental management decisions of Borrower (whether through direct or indirect control of the governing body of Borrower, through a
management services agreement with Borrower or otherwise), provided that the possession by a Person other than NEG of a veto power over material events
with respect to Borrower (e.g., dissolution of Borrower, merger or consolidation of Borrower, sale of all or substantially all assets of Borrower, material amendments to Borrower's organizational
documents) shall not in and of itself constitute a failure by NEG to control the fundamental management decisions of Borrower, or (b) except as provided in  Section 6.4, Borrower shall fail to
directly or indirectly own, through the applicable Approved Intermediate Holding Companies, 100% of the
equity and voting interests in the Approved Project Companies. 

        7.1.11    Negative Pledge.    The equity interests in Borrower held by NEG or any Subsidiary of NEG shall be pledged
to any Person other than Administrative Agent for the benefit of the Secured Parties. 

        7.1.12    Project Events of Default.    

        (a)  A
Fundamental Project Event of Default shall have occurred and be continuing. 

        (b)  Any
Project Event of Default shall have occurred and be continuing and shall result in a Borrower Material Adverse Effect. 

        7.1.13    Unenforceability of Credit Documents.    At any time after the execution and delivery thereof, any material
provision of any Credit Document shall cease to be in full force and effect (other than by reason of a release of Collateral thereunder in accordance with the terms hereof or thereof, the satisfaction
in full of the Obligations or any other termination of a Credit Document 

77

 

in accordance with the terms hereof and thereof) or any Credit Document shall be declared null and void by a Governmental Authority of competent jurisdiction. 

        7.1.14    Equity Documents.    

        (a)  Any
Equity Document shall fail to be in full force and effect (other than due to a termination thereof in accordance with the terms hereof and thereof) or any Equity
Party shall repudiate any of its obligations thereunder. 

        (b)  Any
Equity Party shall fail to make any payment as and when due under any Equity Document to which it is a party. 

        7.2    Remedies.    Upon the occurrence and during the continuation of a Borrower Event of Default, Administrative
Agent, the Banks and the Lender Groups may, at the election of the Majority Banks, without further notice of default, presentment or demand for payment, protest or notice of non-payment or
dishonor, or other notices or demands of any kind, all such notices and demands being waived, exercise any or all of the following rights and remedies, in any combination or order that the Majority
Banks may elect (except as expressly set forth below), in addition to such other rights or remedies as
the Banks and the Lender Groups may have hereunder, under the Collateral Documents or at law or in equity: 

        7.2.1    No Further Loans or Letters of Credit.    Cancel all Commitments and refuse to (and Administrative Agent, the
Banks and the Lender Groups shall not be obligated to) (i) continue any Loans, (ii) make any additional Loans, (iii) issue, renew, extend the Expiration Date of, or increase the
Stated Amount of, any Letter of Credit, or (iv) make any payments, or permit the making of payments, from any Account or any proceeds or other funds held by Administrative Agent under the
Credit Documents or on behalf of any Credit Party; provided that in the event of a Borrower Event of Default occurring under  Section 7.1.4, all
Commitments shall be cancelled and terminated without further act of Administrative Agent, any Bank or any Lender Group. 

        7.2.2    Cure by Majority Banks.    Without any obligation to do so, make disbursements or Loans to or on behalf of
Borrower to cure any Borrower Event of Default hereunder and to cure any default or render any performance under any Project Document as the Majority Banks in their sole discretion may consider
necessary or appropriate, whether to preserve and protect the Collateral or the Secured Parties' interests therein or for any other reason, and all sums so expended, together with interest on such
total amount at the Default Rate (but in no event shall the rate exceed the maximum lawful rate), shall be repaid by Borrower to Administrative Agent on demand and shall be secured by the Credit
Documents, notwithstanding that such expenditures may, together with amounts advanced under this Agreement, exceed the aggregate amount of the Total Commitments. 

        7.2.3    Acceleration.    Declare and make all sums of accrued and outstanding principal and accrued but unpaid
interest remaining under this Agreement, together with all unpaid fees, costs (including Liquidation Costs) and charges due hereunder or under any other Credit Document, immediately due and payable,
and require Borrower immediately, without presentment, demand, protest or other notice of any kind, all of which Borrower hereby expressly waives, to pay Administrative Agent and the Banks an amount
in immediately available funds equal to the aggregate amount of any outstanding Reimbursement Obligations, provided that in the event of an Event of
Default occurring under Section 7.1.4, all such amounts shall become immediately due and payable without further act of Administrative Agent, any
Bank or any Lender Group. 

        7.2.4    Cash Equity Contributions.    Demand that Borrower make, or cause to be made, Cash Equity Contributions in an
amount equal to the then current Available Equity Commitment in accordance with Section 3.15.2(b);  provided that in the event of an Event of Default
occurring under Section 7.1.4, Borrower shall
be required to immediately make, or cause to be made, Cash 

78

 

Equity Contributions in an amount equal to the then current Available Equity Commitment without further act of Administrative Agent, any Bank or any Lender Group. 

        7.2.5    Cash Collateralization of Letters of Credit.    If Administrative Agent, the Banks and the Lender Groups have
exercised the remedies described in Section 7.2.3, maintain in the Accounts for payment of
any Reimbursement Obligations or interest thereon arising in connection with any outstanding Letter of Credit an amount of cash equal to the then current Stated Amount of each such Letter of Credit
(plus accrued interest on the amounts in such Accounts). 

        7.2.6    Cash Collateral.    Apply or execute upon any amounts on deposit in any Account or any proceeds or any other
monies of Borrower on deposit with Administrative Agent or any other Secured Party in the manner provided in the Uniform Commercial Code and other relevant statutes and decisions and interpretations
thereunder with respect to cash collateral. 

        7.2.7    Possession of Approved Projects.    Enter into possession of any Approved Project and perform any and all
work and labor necessary to complete such Approved Project or to operate and maintain such Approved Project, and all sums expended by Administrative Agent in so doing, together with interest on such
total amount at the Default Rate, shall be repaid by Borrower to Administrative Agent upon demand and shall be secured by the Credit Documents to the extent provided herein, notwithstanding that such
expenditures may, together with amounts advanced under this Agreement, exceed the aggregate amount of the Total Commitments. 

        7.2.8    Remedies Under Credit Documents.    Exercise any and all rights and remedies available to them under any of
the Credit Documents, including judicial or non-judicial foreclosure or public or private sale of any of the Collateral pursuant to the Collateral Documents. 

        7.3    Building Loan Documents.    Notwithstanding anything contained in this Agreement or any other Credit Document
to the contrary, a default under any of the Building Loan Documents shall not be deemed to be a Borrower Event of Default, Borrower Inchoate Default, Project Event of Default or Project Inchoate
Default. 

ARTICLE 8.
  SCOPE OF LIABILITY  

        Except as otherwise expressly provided in this Agreement and the other Operative Documents (including the NEG Equity Guaranty, any other Equity Document, the NEG
EPC Guaranties, the Millennium O&M Cost Contribution Agreement and the Other NEG Support Documents), each of the parties hereto (other than Borrower) (the
"Non-Company Parties") agrees that all obligations of the Credit Parties under the Operative Documents shall be obligations solely of the
Credit Parties, and each Non-Company Party shall have recourse only to the assets of the Credit Parties in enforcing such obligations. Except as otherwise expressly provided in this
Agreement and the other Operative Documents, each Non-Company Party hereby acknowledges and agrees that none of the members, partners or shareholders of the Credit Parties, their
respective Affiliates and their past, present or future officers, directors, employees, shareholders, agents or representatives (collectively, the "Nonrecourse
Parties") shall have any liability to any Non-Company Party for the payment of any sums now or hereafter owing by the Credit Parties under the Operative Documents
or for the performance of any of the obligations of the Credit Parties contained therein or shall otherwise be liable or
responsible with respect thereto (such liability, including such as may arise by operation of law, being hereby expressly waived). Except as otherwise expressly provided in this Agreement and the
other Operative Documents, if any Borrower Event of Default shall occur and be continuing or if any claim of any Non-Company Party against, or alleged liability to any
Non-Company Party of, the Credit Parties shall be asserted under this Agreement or the other Operative Documents, each Non-Company Party agrees that it shall not have the right
to proceed directly or indirectly against the Nonrecourse Parties or against their respective properties and assets for the satisfaction of any of the obligations of the 

79

 

Credit Parties under this Agreement or the other Operative Documents or of any such claim or liability or for any deficiency judgment in respect of such obligation or any such claim or liability or
for any deficiency judgment in respect of such obligation or any such claim or liability. The foregoing notwithstanding, it is expressly understood and agreed that nothing contained in this  Article 8 shall be deemed to release any Nonrecourse Party from liability for its fraudulent actions or willful misconduct. The foregoing
acknowledgments, agreements and waiver shall be enforceable by any Nonrecourse Party. 

ARTICLE 9.
  ADMINISTRATIVE AGENT; AMENDMENTS AND WAIVERS  

        9.1    Appointment; Powers and Immunities.    

        9.1.1    Each
Bank and each Lender Group Member hereby appoints and authorizes Administrative Agent to act as its agent hereunder and under the other Credit Documents with such
powers as are expressly delegated to Administrative Agent by the terms of this Agreement and the other Credit Documents, together with such other powers as are reasonably incidental thereto.
Administrative Agent shall not have any duties or responsibilities except those expressly set forth in this Agreement or in any other Credit Document, or be a trustee or a fiduciary for any Bank or
any Lender Group Member. Notwithstanding anything to the contrary contained herein, Administrative Agent shall not be required to take any action which is contrary to this Agreement or any other
Credit Documents or any Legal Requirement or exposes Administrative Agent to any liability. Each of Administrative Agent, the Banks, the Lender Group Members and any of their respective Affiliates
shall not be responsible to any other Bank or any other Lender Group Member for any recitals, statements, representations or warranties made by any Equity Party, Borrower, any other Credit Party or
any of their Affiliates contained in the Credit Documents or in any certificate or other document referred to or provided for in, or received by Administrative Agent, or any Bank or any Lender Group
Member under, the Credit Documents, for the value, validity, effectiveness, genuineness, enforceability or sufficiency of the Credit Documents, the Notes or any other document referred to or provided
for herein or for any failure by any Equity Party, Borrower, any other Credit Party or any of their Affiliates to perform their respective obligations hereunder or thereunder. Administrative Agent may
employ agents and attorneys-in-fact and shall not be responsible for the negligence or misconduct of any such agents or attorneys-in-fact selected by it
with reasonable care. 

        9.1.2    Administrative
Agent and its directors, officers, employees and agents shall not be responsible for any action taken or omitted to be taken by it or them hereunder or
under any other Credit Document or in connection herewith or therewith, except for its or their own gross negligence or willful misconduct. Without limiting the generality of the foregoing,
Administrative Agent (a) may treat the payee of any Note as the holder thereof until Administrative Agent receives written notice of the assignment or transfer thereof signed by such payee and
in form satisfactory to Administrative Agent; (b) may consult with legal counsel, independent public accountants and other experts selected by it and shall not be liable for any action taken or
omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (c) makes no warranty or representation to any Bank or any Lender Group Member for
any statements, warranties or representations made in or in connection with any Operative Document; (d) shall not have any duty to ascertain or to inquire as to the performance or observance of
any of the terms, covenants or conditions of any Operative Document on the part of any party thereto or to inspect the property (including the books and records) of any Credit Party or any other
Person; and (e) shall not be responsible to any Bank or any Lender Group Member for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of any Operative
Document or any other instrument or document furnished pursuant hereto. Except as otherwise provided under this Agreement, Administrative Agent shall take such action with respect to the Credit
Documents as shall be directed by the Majority Banks. 

80

   
        9.2    Reliance by Administrative Agent.    Administrative Agent shall be entitled to rely upon any certificate,
notice or other document (including any cable, telegram, facsimile or telex) believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper Person or Persons,
and upon advice and statements of legal counsel, independent accountants and other experts selected by Administrative Agent. As to any other matters not expressly provided for by this Agreement,
Administrative Agent shall not be required to take any action or exercise any discretion, but shall be required to act or to refrain from acting upon instructions of the Majority Banks (except that
Administrative Agent shall not be required to take any action which exposes Administrative Agent to personal liability or which is contrary to this Agreement, any other Credit Document or any Legal
Requirement) and shall in all cases be fully protected in acting, or in refraining from acting, hereunder or under any other Credit Document in accordance with the instructions of the Majority Banks,
and such instructions of the Majority Banks and any action taken or failure to act pursuant thereto shall be binding on all of Banks and all of the Lender Groups (and all of the members thereof). 

        9.3    Non-Reliance.    Each Bank and each Lender Group Member represents that it has, independently and
without reliance on Administrative Agent or any other Bank or Lender Group Member, and based on such documents and information as it has deemed appropriate, made its own appraisal of the financial
condition and affairs of the Credit Parties and decision to enter into this Agreement and agrees that it will, independently and without reliance upon Administrative Agent or any other Bank or Lender
Group Member, and based on such documents and information as it shall deem appropriate at the time, continue to make its own appraisals and decisions in taking or not taking action under this
Agreement. Each of Administrative Agent, any Bank and any Lender Group Member shall not be required to keep informed as to the performance or observance by any Equity Party, Borrower, any other Credit
Party or any of their Affiliates under this Agreement or any other document referred to or provided for herein or to make inquiry of, or to inspect the properties or books of, any Equity Party,
Borrower, any other Credit Party or any of their Affiliates. 

        9.4    Defaults.    Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any NEG
Trigger Event, Borrower Inchoate Default, Borrower Event of Default, Project Event of Default or Project Inchoate Default unless Administrative Agent has received a notice from a Bank, a Lender Group
Member or Borrower, referring to this Agreement, describing such NEG Trigger Event, Borrower Inchoate Default, Borrower Event of Default, Project Event of Default or Project Inchoate Default and
indicating that such notice is a notice of default (or a notice of NEG Trigger Event, as applicable). If Administrative Agent receives such a notice of the occurrence of a NEG Trigger Event, Borrower
Inchoate Default, Borrower Event of Default, Project Event of Default or Project Inchoate Default, Administrative Agent shall give notice thereof to the Banks, the Lender Group Agents on behalf of
their respective Lender Groups, Borrower and, with respect to a Borrower Event of Default, Greene County Industrial Development Agency (at the address therefor provided to Administrative Agent by
Borrower). Administrative Agent shall take such action with respect to any NEG Trigger Event, Borrower Inchoate Default or Borrower Event of Default as is provided in  Article 7 or if not
provided for in Article 7, as Administrative Agent shall be reasonably directed by the Majority Banks;  provided, however, the unless and until Administrative Agent shall have received such direction,
Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Borrower Inchoate Default or Borrower Event of Default as it shall
deem advisable in the best interest of the Banks and the Lender Groups. 

        9.5    Indemnification.    Without limiting any Obligation of any of Credit Party hereunder, each Bank and each
Related Bank agrees to indemnify Administrative Agent and its officers, directors, shareholders, affiliates, controlling Persons, employees, agents and servants, ratably (i) in the case of a
Bank, in accordance with such Bank's Proportionate Share, and (ii) in the case of a Related Bank, the Related Bank's Indemnity Share (as defined below), for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature 

81

 

whatsoever which may at any time be imposed on, incurred by or asserted against Administrative Agent or any such Person in any way relating to or arising out of this Agreement or any documents
contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or the enforcement of any of the terms hereof or thereof or of any such other documents (to the
extent Borrower has not paid any such amounts pursuant to Section 5.8); provided,  however, that no Bank
or Related Bank shall be liable for any of the foregoing to the extent they arise from Administrative Agent's or any such Person's
gross negligence or willful misconduct. The "Indemnity Share" of each Related Bank at any time shall be a fraction (expressed as a decimal), the
numerator of which shall be such Related Bank's Parallel Funding Commitment at such time, and the denominator of which shall be the aggregate of the then current Total Construction Loan Commitment,
Total Working Capital/Project LC Commitment and Total DSR LC Commitment. Administrative Agent and any such Person shall be fully justified in refusing to take or to continue to take any action
hereunder unless it shall first be indemnified to its satisfaction by the Banks and the Related Banks against any and all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Without limitation of the foregoing, each Bank and each Related Bank agrees to reimburse Administrative Agent and any such Person promptly upon demand for its
ratable share of any out-of-pocket expenses (including counsel fees) incurred by Administrative Agent or any such Person in connection with the preparation, execution,
administration or enforcement of, or legal advice in respect of rights or responsibilities under, the Operative Documents, to the extent that Administrative Agent or any such Person is not reimbursed
for such expenses by Borrower. 

        9.6    Successor Administrative Agent.    Administrative Agent acknowledges that its current intention is to remain
Administrative Agent hereunder. Nevertheless, Administrative Agent may resign at any time by giving 15 days' written notice thereof to the Banks, the Lender Group Agents on behalf of their
respective Lender Groups and Borrower. Administrative Agent may be removed involuntarily only for a material breach of its duties and obligations hereunder or under the other Credit Documents or for
gross negligence or willful misconduct in connection with the performance of its duties hereunder or under the other Credit Documents and then only upon the affirmative vote of the Majority Banks
(excluding Administrative Agent from such vote and Administrative Agent's Proportionate Share of the Total Commitment from the amounts used to determine the portion of the Total Commitment necessary
to constitute the required Proportionate Share of the remaining Banks). Upon any such resignation or removal, the Majority Banks shall have the right, with the consent of Borrower if no Borrower
Inchoate Default under Section 7.1.1 or Borrower Event of Default has occurred and is continuing (such consent not to be unreasonably withheld or
delayed), to appoint a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the
Majority Banks, and shall have accepted such appointment within 30 days after the retiring Administrative Agent's giving of notice of resignation or the Majority Banks' removal of the retiring
Administrative Agent, the retiring Administrative Agent may, on behalf of the Banks and the Lender Groups (and each Lender Group Member), with the consent of Borrower if no Borrower Inchoate Default
under Section 7.1.1 or Borrower Event of Default has occurred as is continuing (such consent not to be unreasonably withheld or delayed), appoint
a successor Administrative Agent, which shall be a Bank or a Related Bank, if any Bank or Related Bank shall be willing to serve, and otherwise shall be a commercial bank having a combined capital and
surplus of at least $500,000,000. Upon the acceptance of any appointment as Administrative Agent under the Operative Documents 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 shall be discharged from its
duties and obligations as Administrative Agent. After any retiring Administrative Agent's resignation or removal hereunder as Administrative Agent, the provisions of this  Article 9 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Credit
Documents. 

82

 

        9.7    Authorization.    Administrative Agent is hereby authorized by the Banks and the Lender Groups (and the Lender
Group Members) to execute, deliver and perform each of the Credit Documents to which Administrative Agent is or is intended to be a party and each Bank and each Lender Group (and each Lender Group
Member) agrees to be bound by all of the agreements of Administrative Agent contained in the Credit Documents. Administrative Agent is further authorized by the Secured Parties to release liens on
property that the Credit Parties are permitted to sell or transfer pursuant to the terms of this Agreement or the other Credit Documents, and to enter into agreements supplemental hereto for the
purpose of curing any formal defect, inconsistency, omission or ambiguity in this Agreement or any Credit Document to which it is a party. 

        9.8    Administrative Agent as a Bank.    With respect to its Commitments, the Loans made by it and any Note issued to
it, the financial institution acting as Administrative Agent shall have the same rights and powers under the Operative Documents as any other Bank and may exercise the same as though it were not
Administrative Agent. The term "Bank" or "Banks" shall, unless otherwise expressly indicated, include Administrative Agent in its individual capacity. The financial institution acting as
Administrative Agent and its Affiliates may accept deposits from, lend money to, act as trustee under indentures of, and generally engage in any kind of business with Borrower or any other Person,
without any duty to account therefor to the Banks or the Lender Groups (or any Lender Group Member). The parties acknowledge and agree that, except as expressly set forth herein, the Arrangers (other
than Administrative Agent) shall not, in such capacities (but not in their capacities as Banks, Related Banks or Lender Group Agents), have any rights, responsibilities, duties, obligations (including
any fiduciary obligations) or liability hereunder. 

        9.9    Amendments; Waivers.    

        (a)  Subject
to the provisions of this Section 9.9, unless otherwise specified in this Agreement or any other Credit
Document, the Majority Banks (or Administrative Agent with the prior written consent of the
Majority Banks) may approve in writing any amendment, supplement or other modification of, or waiver, consent, approval, agreement or other action under or with respect to, any Credit Document;  provided,
 however, that no such amendment, supplement, modification, waiver, consent, approval,
agreement or action shall modify or waive Section 7.1.10(a) (Loss of Control of Borrower) without the prior written consent of the Supermajority
Banks; and provided, further, however, that no such
amendment, supplement, modification, waiver, consent, approval, agreement or action shall, without the prior written consent of all of the Banks and all of the Lender Groups: 

          (i)  Modify
or waive (A) Section 2.6 (Pro Rata Treatment), 2.7
(Change of Circumstances), 2.8 (Funding Losses), 2.9 (Alternate Office, etc.),  3.1 (Conditions Precedent to
Closing Date), 3.15 (Committed Equity Contributions),
7.1.10(b) (Loss of Control of Project), 7.1.11 (Negative Pledge),  9.1 (Administrative Agent), 9.13 (Participation) or 9.14
(Transfer of Commitments) hereof, (B) Article II (Guarantee) of any Project Company Guaranty,
(C) Section II (Guarantee) of the NEG Equity Guaranty or any corresponding section of any other Equity Document, or
(D) Article II (Establishment and Administration of Accounts) or Article III
(Security Interest; Remedies) of the Depositary Agreement (except as expressly set forth therein); 

        (ii)  Increase
the amount of any Commitment of any Bank or Lender Group hereunder; 

        (iii)  Change
the percentage specified in the definition of "Majority Banks" or "Supermajority Banks"; 

        (iv)  Change
any requirement that an amendment, waiver or other matter hereunder or under the other Credit Documents be subject to the consent or approval of a specified
percentage or number of Banks or Lender Groups; 

83

 

        (v)  Change
the definition of "Maximum Debt to Capitalization Ratio"; 

        (vi)  Permit
any Equity Party or Credit Party to assign, transfer or otherwise dispose of any of its rights or obligations under, or permit the termination or release of, any
of the Credit Documents, except as expressly permitted by the terms of this Agreement and the other Credit Documents; 

      (vii)  Permit
a transfer of any equity or voting interest in any Credit Party, except as expressly permitted by the terms of this Agreement and the other Credit Documents; 

      (viii)  Amend
this Section 9.9; 

        (ix)  Permit
the release of any Collateral from the Lien of any of the Collateral Documents, except (A) if such Collateral is replaced with substantially equivalent
Collateral (as determined by Administrative Agent) or (B) as otherwise expressly permitted by the terms of this Agreement and the other Credit Documents; 

        (x)  Extend
the maturity of any Loan or any of the Notes or reduce the principal amount thereof; 

        (xi)  Extend
the Expiration Date of any Letter of Credit (other than any automatic extension of the Expiration Date of any Letter of Credit that is expressly provided for in
such Letter of Credit); 

      (xii)  Extend
the scheduled Final Maturity Date; 

      (xiii)  Reduce
the amount or change the time of payment for any principal, interest, fees or other amounts due hereunder or under any other Credit Document; 

      (xiv)  Increase
the maximum duration of Interest Periods permitted hereunder; or 

      (xv)  Agree
to subordinate the Obligations to any other indebtedness. 

        (b)  Without
limiting anything contained in clause (a) above, (i) no amendment, supplement or other modification of, or waiver, consent, approval, agreement or
other action under or with respect to, any Note (other than by way of amending a document referred to therein) shall be effective without the written concurrence of the Bank or Lender Group which is
the holder of that Note, (ii) no amendment, supplement or other modification of, or waiver, consent, approval, agreement or other action under or with respect to, any provision of any Credit
Document which, by its terms, expressly requires the approval or concurrence or is expressly for the benefit of Administrative Agent shall be effective without the written concurrence of
Administrative Agent, and (iii) no amendment, supplement or other modification of, or waiver, consent, approval, agreement or other action under or with respect to, any provision of any Credit
Document which, by its terms, expressly requires the approval or concurrence or is expressly for the benefit of the Depositary Agent shall be effective without the written concurrence of the
Depositary Agent. 

        (c)  At
any time when there are more than 50 Banks and Lender Groups party to this Agreement (for the purpose of such calculation, the institution acting as both a Bank and
the LC Bank and any
institution acting as both a Bank and a Hedge Bank, a Related Bank and a Hedge Bank or a Bank and a Related Bank shall be counted only once), any proposed approval to be given or other action to be
taken by the Majority Banks hereunder or under any other Credit Document (including supplemental agreements with any party to a Credit Document adding, modifying or waiving any provisions in the
Credit Documents or changing in any manner the rights of the Banks, the Lender Groups (or any member thereof) or Borrower hereunder or waiving any NEG Trigger Event, Borrower Inchoate Default,
Borrower Event of Default, Project Inchoate Default or Project Event of Default under this Section 9.9) shall be deemed so given or taken by the
Majority Banks unless Banks and Lender Groups having Proportionate Shares which in the 

84

 

aggregate exceed 40% notify Administrative Agent of such Banks' and Lender Groups' disapproval of such proposed approval or other action by the date which is 15 Banking Days after the later of
(i) the date Borrower or Administrative Agent notifies the Banks and the Lender Group Agents on behalf of their respective Lender Groups of such proposed approval or other action and
(ii) the date the Banks and the Lender Group Agents on behalf of their respective Lender Groups receive all documentation and other information which Administrative Agent considers reasonably
necessary for the Banks' and the Lender Groups' consideration of such proposed approval or other action and such additional documentation and other information that a Bank or a Lender Group Agent on
behalf of its respective Lender Group may reasonably request within five Banking Days after receipt of the documentation and other information originally provided by Administrative Agent under this
clause (ii). 

        9.10    Withholding Tax.    

        9.10.1    To
the extent required by any applicable law, Administrative Agent may withhold from any interest payment to any Bank or any Lender Group (or any member thereof) an
amount equivalent to any applicable withholding tax. If the forms or other documentation required by Section 2.5 are not delivered to
Administrative Agent, then Administrative Agent may withhold from any interest payment to any Bank or any Lender Group (or any member thereof) not providing such forms or other documentation, an
amount equivalent to the applicable withholding tax. 

        9.10.2    If
the Internal Revenue Service or any authority of the United States or other jurisdiction asserts a claim that Administrative Agent did not properly withhold tax
from amounts paid to or for the account of any Bank or Lender Group (or any member thereof) (because the appropriate form was not delivered, was not properly executed, or because such Bank or such
Lender Group (or any member thereof) failed to notify Administrative Agent of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective, or for any
other reason), such Bank or Lender Group shall indemnify Administrative Agent fully for all amounts paid, directly or indirectly, by Administrative Agent as tax or otherwise, including penalties and
interest, together with all expenses incurred, including legal expenses, allocated staff costs and any out of pocket expenses. 

        9.10.3    If
any Bank or Lender Group sells, assigns, grants a participation in, or otherwise transfers its rights under this Agreement, the purchaser, assignee, participant or
transferee, as applicable, shall comply and be bound by the terms of Sections 2.5.7, 9.10.1 and  9.10.2 as
though it were a Bank. 

        9.11    General Provisions as to Payments.    Administrative Agent shall promptly distribute to each Bank and each
Lender Group Agent on behalf of its respective Lender Group, subject to the terms of any Assignment Agreement between Administrative Agent and such Bank or such Lender Group substantially in the form
of Exhibit L hereto, its pro rata share of each payment of principal and interest payable to the
Banks and the Lender Groups on the Loans, each payment of fees hereunder received by Administrative Agent for the account of the Banks and the Lender Groups, and each payment of any other amounts
owing under this Agreement. The payments made for the account of each Bank and each Related Bank shall be made, and distributed to it, for the account of its domestic or foreign lending office, as
such Bank or such Related Bank may, subject to Section 2.9.3, designate in writing to Administrative Agent. Banks and Related Banks shall have
the right, subject to Section 2.9.3, to alter designated lending offices upon five Banking Days prior written notice to Administrative Agent and
Borrower. 

        9.12    Substitution of Bank or Lender Group.    (a) Should any Bank which is not also a Related Bank fail to
make a Loan in violation of its obligations under this Agreement (a "Non-Advancing Bank"), Administrative Agent shall (a) in its sole
discretion fund the Loan on behalf of the Non-Advancing Bank or (b) cooperate with Borrower or any Bank to find another Person that shall be 

85

 

acceptable to Administrative Agent and that shall be willing to assume the Non-Advancing Bank's obligations under this Agreement (including the obligation to make the Loan which the
Non-Advancing Bank failed to make but without assuming any liability for damages for failing to have made such Loan or any previously required Loan). Subject to the provisions of the next
following sentence, such Person shall be substituted for the Non-Advancing Bank hereunder upon execution and delivery to Administrative Agent of an agreement acceptable to Administrative
Agent by such Person assuming the Non-Advancing Bank's obligations under this Agreement, and all interest and fees which would otherwise have been payable to the Non-Advancing
Bank shall thereafter be payable to such Person. Nothing in (and no action taken pursuant to) this Section 9.12 shall (a) relieve the
Non-Advancing Bank from any liability it might have to Borrower or to the other Banks as a result of its failure to make any Loan or (b) limit any of the provisions set forth in  Section 2.1.6.

        (b)  Should
any Related Bank fail to make a Loan in violation of its obligations under this Agreement (a "Non-Advancing Related
Bank"), Administrative Agent shall (a) in its sole discretion fund the Loan on behalf of the Non-Advancing Related Bank or (b) cooperate with
Borrower, any Bank or any Lender Group to find another Person that shall be acceptable to Administrative Agent and that shall be willing to assume the obligations of the Lender Group of which such
Non-Advancing Related Bank is a member under this Agreement and the obligations of such Non-Advancing Related Bank as a Bank under this Agreement with respect to such Bank's
Working Capital/Project LC Commitment and DSR LC Commitment (including any outstanding Loans made thereunder, and including the obligation to make the Loan which the Non-Advancing Related
Bank failed to make but without assuming any liability for damages for failing to have made such Loan or any previously required Loan). Subject to the provisions of the next following sentence, such
Person shall be substituted for the applicable Lender Group and the Non-Advancing Related Bank as a Bank hereunder upon execution and delivery to Administrative Agent of an agreement
acceptable to Administrative Agent by such Person assuming the obligations of the Lender Group of which such Non-Advancing Related Bank is a member under this Agreement and the obligations
of such Non-Advancing Related Bank as a Bank under this Agreement with respect to such Bank's Working Capital/Project LC Commitment and DSR LC Commitment, and all interest and fees which
would otherwise have been payable to such Lender Group and to such Non-Advancing Related Bank as a Bank under this Agreement shall thereafter be payable to such
Person. Nothing in (and no action taken pursuant to) this Section 9.12 shall (a) relieve the Non-Advancing Related Bank from
any liability it might have to Borrower, the other Banks or Lender Groups (or any member thereof) as a result of its failure to make any Loan or (b) limit any of the provisions set forth in  Section 2.1.6. 

        9.13    Participation.    

        9.13.1    Nothing
herein provided shall prevent any Bank or any Lender Group (or any member thereof) from selling a participation in one or more of its Commitments (and Loans
made thereunder); provided that (a) no Bank or Lender Group may sell a participation in its Commitments (including Loans) prior to the earlier of
(i) March 31, 2002 and (ii) the date on which the Lead Arrangers and Borrower notify the Banks and Lender Groups otherwise, (b) no such sale of a participation shall alter
such Bank's, such Lender Group's (or such Lender Group Member's) or Borrower's obligations hereunder, and (c) any agreement pursuant to which any Bank or any Lender Group (or any member
thereof) may grant a participation in its rights with respect to its Commitments shall provide that, with respect to such Commitments, subject to the following proviso, such Bank or such Lender Group
(or such Lender Group Member) shall retain the sole right and responsibility to exercise the rights of such Bank or such Lender Group, and enforce the obligations of Borrower relating to such
Commitments, including the right to approve any amendment, modification or waiver of any provision of this Agreement or any other Credit Document and the right to take action to have the Obligations
(or any portion thereof) declared due and payable pursuant to Article 7; provided,  however, that such
agreement may provide that the participant may have the right to approve or disapprove decreases in Commitments, interest rates or
fees, lengthening of maturity of any Loans, extension of the payment date for any amount due 

86

 

under Article 2 hereof or release of any material Collateral. No recipient of a participation in any Commitments or Loans of any Bank or any
Lender Group (or any Lender Group Member) shall have any rights under this Agreement or shall be entitled to any reimbursement for Taxes, Other Taxes, increased costs or reserve requirements under  Section 2.5 or 2.7 or any other indemnity or payment rights against Borrower (but shall be
permitted to receive from the Bank or the Lender Group (or the Lender Group Member) granting such participation a proportionate amount which would have been payable to the Bank or the Lender Group (or
the Lender Group Member) from whom such Person acquired its participation). 

        9.13.2    Notwithstanding
anything to the contrary contained herein, any Bank (a "Granting Bank") may grant to a special purpose
funding vehicle (a "SPC"), identified as such in writing from time to time by the Granting Bank to Administrative Agent and Borrower, the option to
provide to Borrower all or any part of any Loan that such Granting Bank would otherwise be obligated to make to Borrower pursuant to this Agreement;  provided that (i) nothing herein shall
constitute a commitment by any SPC to make any Loan, and (ii) if an SPC elects not to exercise such
option or otherwise fails to provide all or any part of such Loan, the Granting Bank shall be obligated to make such Loan pursuant to the terms hereof. The making of a Loan by an SPC hereunder shall
utilize the Commitments of the Granting Bank to the same extent, and as if, such Loan were made by such Granting Bank. Each party hereto hereby agrees that no SPC shall be liable for any indemnity or
similar payment obligation under this Agreement (all liability for which shall remain with the Granting Bank). In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall
survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other senior indebtedness of any SPC,
it will not institute against, or join any other Person in instituting against, such SPC any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings under the laws of the United States or any state thereof. In addition, notwithstanding anything to the contrary contained in this  Section 9.13.2, any SPC may
(i) with notice to, but without the prior written consent of, Borrower and Administrative Agent and without
paying any processing fee therefor, assign all or a portion of its interests in any Loans to the Granting Bank or to any financial institutions (consented to by Borrower and Administrative Agent)
providing liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans and (ii) disclose on a confidential basis any non-public
information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPC. This section may not be amended
without the prior written consent of the SPC. 

        9.14    Transfer of Commitments    

        9.14.1    Generally.    Notwithstanding anything else herein to the contrary, any Bank that is not a Related Bank or
any Lender Group, after receiving (a) Borrower's prior written consent as to the identity of the assignee (which consent shall not be unreasonably withheld or delayed or, so long as a Borrower
Inchoate Default under Section 7.1.1 or Borrower Event of Default has occurred and is continuing, required), (b) Administrative Agent's
prior written consent (which consent shall not be unreasonably withheld or delayed) and (c) the LC Bank's prior written consent if the assignee is rated lower than Baa3 by Moody's or lower than
BBB- by S&P (which consent shall not be unreasonably withheld or delayed), may from time to time, at its option, sell, assign, transfer, negotiate or otherwise dispose of all or any
portion of one or more of its Commitments (and Loans made thereunder) (including such Bank's or Lender Group's interest in this Agreement and the other Credit Documents) to any bank or other lending
institution or other Lender Group which in such assigning Bank's or Lender Group's judgment is reasonably capable of performing the obligations of a Bank or Lender Group hereunder;  provided,
however, that no Bank or Lender Group may assign any portion of its Commitments (including
Loans) prior to the earlier of (i) March 31, 2002 and (ii) the date on which the Lead Arrangers and Borrower notify the Banks and Lender Groups otherwise;  provided, further, that no Bank or Lender Group 

87

 

(including any assignee of any Bank or any Lender Group) may assign any portion of its Commitments (including Loans) of less than $10,000,000 (unless to another Bank or another Lender Group);  provided,
further, that a Bank or Lender Group may assign Commitments (including Loans) of less than
$10,000,000 if such assignment includes all of such Bank's or Lender Group's Commitments (including Loans) and such Bank or Lender Group did not previously assign its Commitments (including Loans) so
as to result in such Bank or Lender Group holding less than $10,000,000 of Commitments (including Loans); provided,  further, that any Bank may assign all
or any portion of its Commitments (and Loans made thereunder) to an Affiliate of such Bank and any Lender Group
may assign all or any portion of its Commitments (and Loans made thereunder) to the Related Bank in such Lender Group as a Bank, in each instance without the consent of any Person; and  provided,
further, that in the event of any assignment by a Lender Group of a portion of its Lender
Group Construction Loans, such assignment shall designate the amount of such assigned Lender Group Construction Loans that are Related Bank Loans and the amount that are CP Conduit Construction Loans.
In the event of any such assignment, (i) the assigning Bank's or the assigning Lender Group's Proportionate Share shall be reduced and its obligations hereunder released by the amount of the
Proportionate Share assigned to the new lender, (ii) the parties to such assignment shall execute and deliver to Administrative Agent an Assignment Agreement evidencing such sale, assignment,
transfer or other disposition substantially in the form of Exhibit L hereto or otherwise satisfactory to Administrative Agent together with an
assignment fee payable to Administrative Agent of $5,000 (provided such assignment fee shall not be required with respect to the initial syndication of
the Arrangers' Commitments or with respect to an assignment by a
Lender Group to the Related Bank in such Lender Group) and any other related documentation reasonably requested by Administrative Agent, including the withholding tax certificates required under  Section 2.5.7, (iii) at the assigning Bank's or the assigning Lender Group's option, (A) Borrower shall execute and deliver to such
assignee new Notes in the forms attached hereto as Exhibits B-1 through B-3
hereto in a principal amount equal to such assignee's Commitments, and (B) Borrower shall execute and exchange with the assigning Bank or the Lender Group Agent for the assigning Lender Group
replacement notes for any Notes in an amount equal to the Commitments retained by such Bank or such Lender Group, if any, (iv) to the extent the assigning Bank or the Lender Group Agent for the
assigning Lender Group has been issued any Notes in its favor, such Bank or Lender Group Agent shall cancel and return each such Note to Borrower promptly after the effectiveness of any such
assignment, (v) Exhibit I hereto shall be automatically amended without further action to reflect such assignment and the Proportionate
Shares of the Banks and the Lender Groups following such assignment and (vi) to the extent such assignment is to a Lender Group, (A) the Related Bank in such Lender Group shall, during
the Construction Loan Availability Period, provide any applicable Parallel Funding Commitments with respect to such Lender Group and Exhibit I
hereto shall be automatically amended without further action to reflect such assignment, and (B) the portion of Construction Loans assigned to such Lender Group and funded by the CP Conduit in
such Lender Group shall (x) to the extent a Base Rate Loan, be deemed to be Base Rate Loan of such CP Conduit with a Base Rate calculated with respect to such CP Conduit and (y) to the
extent a LIBOR Loan continue as such LIBOR Loan until the end of the then current Interest Period and then automatically and without further act or instrument be converted into a CP Conduit Funded
LIBOR Construction Loan on the last day of such Interest Period, which will be deemed to have been funded by such CP Conduit on such day. Thereafter, any such new lender shall be deemed to be a Bank
and shall have all of the rights and duties of a Bank (except as otherwise provided in this Article 9), in accordance with its Proportionate
Share, under each of the Credit Documents. 

        9.14.2    Transfers within Lender Groups.    Each CP Conduit may sell, assign or transfer all or any portion of its CP
Conduit Construction Loans to the Related Bank that is a member of the same Lender Group, and each Related Bank may sell, assign or transfer all or any portion of its Related Bank Construction Loans
to the CP Conduit that is a member of the same Lender Group, 

88

 

in each instance without the consent of any Person. In the event of any such sale, assignment or transfer, on the effective date of such sale, assignment or transfer, (i) CP Conduit
Construction Loans or portions thereof sold, assigned or transferred or deemed to have been sold, assigned or transferred to the applicable Related Bank shall automatically and without further act or
instrument become Related Bank Construction Loans, bearing interest (x) if such CP Conduit Construction Loan was a CP Conduit Funded LIBOR Construction Loan, at the LIBO Rate applicable to such
CP Conduit Funding LIBOR Construction Loan for an initial Interest Period ending on the last day of the Interest Period applicable to such CP Conduit Funding LIBOR Construction Loan, and (y) if
such CP Conduit Construction Loan was a Base Rate Loan, at the Base Rate as applied to such Related Bank, (ii) Related Bank Construction Loans or portions thereof sold, assigned or transferred
or deemed to have been sold, assigned or transferred to the applicable CP Conduit shall automatically and without further act or instrument become CP Conduit Construction Loans, bearing interest
(x) if such Related Bank Construction Loan was a LIBOR Loan, at the LIBOR Rate applicable to such Related Bank Construction Loan for the next succeeding Interest Period,  provided that the effective
date of such sale, assignment or transfer must be the last day of the then current Interest Period with respect to such
LIBOR Loan, and (y) if such Related Bank Construction Loan was a Base Rate Loan, at the Base Rate as applied to such CP Conduit, (iii) the amount of the Parallel Funding Commitment of
the applicable Related Bank shall not be increased or decreased as a result of any such assignment, and (iv) the parties to such assignment shall execute and deliver to the applicable Lender
Group Agent an assignment agreement in form and substance reasonably satisfactory to such Lender Group Agent
evidencing such sale, assignment or transfer, and any other related documentation reasonably requested by such Lender Group Agent. Each CP Conduit may sell, assign or transfer all of its CP Conduit
Construction Loans and its interest under this Agreement and the other Credit Documents to another Person that becomes a CP Conduit if and to the extent permitted to do so under the applicable
Liquidity Backstop Agreement and so long as the applicable Related Bank (or its Affiliate) remains as the Liquidity Provider under such Liquidity Backstop Agreement;  provided that such assignment shall
not affect the Parallel Funding Commitment of such Related Bank. The parties to such assignment shall execute and
deliver to the applicable Lender Group Agent an assignment agreement in form and substance reasonably satisfactory to such Lender Group Agent evidencing such sale, assignment or transfer, and any
other related documentation reasonably requested by such Lender Group Agent. Promptly following any transfer pursuant to this Section 9.14.2, the
applicable Lender Group Agent shall notify Borrower and Administrative Agent of such transfer, which such notice shall include the principal amount of the assigned Loan(s) and the effective date of
such assignment. No Related Bank shall (i) assign any portion of its Parallel Funding Commitment other than in connection with a Lender Group assignment permitted under  Section 9.14.1 or
(ii) assign any portion of its Liquidity Backstop Commitment as a Liquidity Provider. No CP Conduit shall permit any
assignment by a Liquidity Provider under the applicable Liquidity Backstop Agreement, other than an assignment by a Liquidity Provider that is an Affiliate of the applicable Related Bank to such
Related Bank. 

        9.15    Securities Laws.    Notwithstanding the foregoing provisions of this  Article 9, no sale, assignment, transfer,
negotiation or other disposition of the interests of any Bank, any Lender Group or any Related Bank
hereunder or under the other Credit Documents shall be allowed if it would require registration under the federal Securities Act of 1933, as then amended, any other federal securities laws or
regulations or the securities laws or regulations of any applicable jurisdiction. Borrower shall, from time to time at the request and expense of Administrative Agent, execute and deliver to
Administrative Agent, or to such party or parties as Administrative Agent may designate, any and all further instruments as may in the opinion of Administrative Agent be reasonably necessary or
advisable to give full force and effect to such disposition. 

89

   
        9.16    Assignability to Federal Reserve Bank.    Notwithstanding any other provision contained in this Agreement
or
any other Credit Document to the contrary, any Bank or any Related Bank may assign all or any portion of the Loans or Notes held by it to any Federal Reserve Bank or the United States Treasury as
collateral security pursuant to Regulation A of the Board of Governors of the Federal Reserve System and any Operating Circular issued by such Federal Reserve Bank,  provided that any payment in
respect of such assigned Loans or Notes made by Borrower to or for the account of the assigning and/or pledging Bank or
Related Bank in accordance with the terms of this Agreement shall satisfy Borrower's obligations hereunder in respect of such assigned Loans or Notes to the extent of such payment. No such assignment
shall release the assigning Bank or the assigning Related Bank from its obligations hereunder and in no event shall such Federal Reserve Bank be considered to be a "Bank" or a "Related Bank" or be
entitled to require the assigning Bank or the assigning Related Bank to take or omit to take any action hereunder. 

        9.17    Additional Banks and Lender Groups.    Any bank or other financial institution may become a Bank hereunder
after the Closing Date, and any lender group may become a Lender Group hereunder at any time after the Closing Date but on or prior to March 31, 2002, by entering into a Joinder Agreement with
Borrower and Administrative Agent; provided that the Related Bank in such Lender Group is also the Liquidity Provider with respect to the CP Conduit in
such Lender Group (or with respect to the Asset Securitization Company providing funding to such CP Conduit). Any bank or other financial institution that so enters into a Joinder Agreement shall,
from and after the date of such Joinder Agreement, have all of the rights and duties of a Bank hereunder in accordance with its Proportionate Share. Any lender group that so enters into a Joinder
Agreement shall, from and after the date of such Joinder Agreement, have all of the rights and duties of a Lender Group hereunder in accordance with its Proportionate Share.  Exhibit I shall be
automatically amended to reflect the addition of a Bank or Lender Group in accordance with this  Section 9.17. On the day on which any Bank or any Lender Group becomes a party to this Agreement
pursuant to this
Section 9.17, such Bank or Lender Group shall: (a) purchase an amount of Construction Loans from each Bank and each Lender Group such
that, after giving effect to such purchase, each Bank's and each Lender Group's (including the new Bank or new Lender Group, as the case may be) outstanding Construction Loans are equal to such Bank's
or such Lender Group's Proportionate Share of all outstanding Construction Loans; (b) purchase an amount of Working Capital Loans (if any) from each Bank such that, after giving effect to such
purchase, each Bank's (including the new Bank) outstanding Working Capital Loans (if any) are equal to such Bank's Proportionate Share of all outstanding Working Capital Loans; (c) purchase an
amount of Project LC Loans (if any) from each Bank such that, after giving effect to such purchase, each Bank's (including the new Bank) outstanding Project LC Loans (if any) are equal to such Bank's
Proportionate Share of all outstanding Project LC Loans; and (d) purchase an amount of DSR LC Loans (if any) from each Bank such that, after giving effect to such purchase, each Bank's
(including the new Bank) outstanding DSR LC Loans (if any) are equal to such Bank's Proportionate Share of all outstanding DSR LC Loans. The Loan purchases described in the preceding sentence shall
not include a purchase of any Commitment. The Loan purchases contemplated by this Section 9.17 shall not be deemed to be Loans for purposes of  Article 3. Notwithstanding anything to the contrary contained in this Agreement, the Commitments relating to the Loans sold in accordance with
this Section 9.17 may
be reutilized in accordance with the terms hereof. No Bank or Lender Group selling Loans in accordance with this Section 9.17 makes any
representation or warranty to any new Bank or new Lender Group in connection with such sale other than that such selling Bank or Lender Group is the owner of such Loans and has not otherwise sold,
assigned or transferred such Loans. Interest on Loans sold pursuant to this Section 9.17 shall be for the benefit of the selling Bank or Lender
Group to but excluding the date of such sale and shall be for the benefit of the purchasing Bank or Lender Group from and after the date of such sale. The blend of Types and Interest Periods for Loans
purchased by a new Bank or Lender Group pursuant to this Section 9.17 shall be consistent with the blend of Types and Interest Periods for Loans
held by the selling Banks and Lender Groups; provided

90

 

that the portion of Construction Loans assigned to a Lender Group and funded by the CP Conduit in such Lender Group shall (x) to the extent a Base Rate Loan, be deemed to be Base Rate Loan of
such CP Conduit with a Base Rate calculated with respect to such CP Conduit and (y) to the extent a LIBOR Loan continue as such LIBOR Loan until the end of the then current Interest Period and
then automatically and without further act or instrument be converted into a CP Conduit Funded LIBOR Construction Loan on the last day of such Interest Period, which will be deemed to have been funded
by such CP Conduit on such day. Any Liquidation Costs incurred in connection with sales of Loans pursuant to this Section 9.17 shall be for the
account of Borrower; provided that Borrower may delay any such sales to a date on which no Liquidation Costs would be incurred in connection therewith.
Any existing Bank or Lender Group may also increase its Commitments by entering into a Joinder Agreement with Borrower and Administrative Agent as contemplated by this  Section 9.17. If any existing
Bank or Lender Group so enters into a Joinder Agreement, references in this  Section 9.17 to the new Bank or Lender Group shall be deemed to be references to such existing Bank or Lender Group for
purposes of the
application of this Section 9.17. Any Incremental Commitments provided pursuant to this  Section 9.17 shall first be used to reduce the Available
Equity Commitment by the aggregate of the original Supplemental Equity Commitments for
Approved Projects as contemplated by Section 3.15.4. 

ARTICLE 10.
  INDEPENDENT CONSULTANTS  

        10.1    Removal and Fees.    

        10.1.1    Independent Engineer.    For purposes of this Agreement, the "Independent
Engineer" shall be R.W. Beck, Inc. or such other replacement engineering consulting firm selected in accordance with this  Section 10.1. Borrower or the Majority Banks
may remove the Independent Engineer in the event that such Independent Engineer (a) ceases to
be a engineering consulting firm of recognized international standing, (b) has become an Affiliate of NEG or (c) has developed a conflict of interest that reasonably calls into question
such firm's capacity to exercise independent judgment. If the Independent Engineer is removed or resigns and thereby ceases to act as Independent Engineer for purposes of this Agreement, the Majority
Banks and Borrower shall, within 30 days of such removal or resignation, jointly designate a replacement engineering consulting firm from the list contained in  Exhibit M hereto and, thereafter,
 Administrative Agent shall promptly notify the Banks and the Lender Group Agents on behalf of their respective
Lender Groups of such designation. At any time and from time to time, the Majority Banks shall have the right to add to Exhibit M hereto one or
more independent engineering
consulting firms and shall notify Borrower, the Banks and the Lender Group Agents on behalf of their respective Lender Groups of any such addition.  Exhibit M hereto shall automatically be deemed
amended to reflect such addition unless, within 30 days of such notification, Borrower
notifies Administrative Agent that it objects, on the basis of the criteria set out in clauses (a) through (c) above for removal of the Independent Engineer, to the firm or firms so
added. 

        At
any time while the Obligations are outstanding, Administrative Agent, the Arrangers, the Banks and the Lender Group Members shall have the right, but shall not be obligated (other
than as expressly provided herein or in the other Credit Documents), to consult with the Independent Engineer on matters related to this Agreement or any other Credit Document. All reasonable fees and
expenses of the Independent Engineer (whether the original one or replacements) shall be paid by Borrower. 

        10.1.2    Insurance Consultant.    For purposes of this Agreement, the "Insurance
Consultant" shall be Marsh McLennan USA, Inc. or such other replacement insurance consulting firm selected in accordance with this  Section 10.1. Borrower or the
Majority Banks may remove the Insurance Consultant in the event that such Insurance Consultant (a) ceases to
be a insurance consulting firm 

91

 

of recognized international standing, (b) has become an Affiliate of NEG or (c) has developed a conflict of interest that reasonably calls into question such firm's capacity to exercise
independent judgment. If the Insurance Consultant is removed or resigns and thereby ceases to act as Insurance Consultant for purposes of this Agreement, the Majority Banks and Borrower shall, within
30 days of such removal or resignation, jointly designate a replacement insurance consulting firm from the list contained in Exhibit N
hereto and, thereafter, Administrative Agent shall promptly notify the Banks and the Lender Group Agents on behalf of their respective Lender Groups of such designation. At any time and from time to
time, the Majority Banks shall have the right to add to Exhibit N hereto one or more independent insurance consulting firms and shall notify
Borrower, the Banks and the Lender Group Agents on behalf of their respective Lender Groups of any such addition. Exhibit N hereto shall
automatically be deemed amended to reflect such addition unless, within 30 days of such notification, Borrower notifies Administrative Agent that it objects, on the basis of the criteria set
out in clauses (a) through (c) above for removal of the Insurance Consultant, to the firm or firms so added. 

        At
any time while the Obligations are outstanding, Administrative Agent, the Arrangers, the Banks and the Lender Group Members shall have the right, but shall not be obligated (other
than as expressly provided herein or in the other Credit Documents), to consult with the Insurance Consultant on matters related to this Agreement or any other Credit Document. All reasonable fees and
expenses of the Insurance Consultant (whether the original one or replacements) shall be paid by Borrower. 

        10.1.3    Fuel Consultant.    For purposes of this Agreement, the "Fuel
Consultant" shall be Pace Global Energy Services, LLC or such other replacement fuel consulting firm selected in accordance with this  Section 10.1. Borrower or the Majority
Banks may remove the Fuel Consultant in the event that such Fuel Consultant (a) ceases to be a fuel
consulting firm of recognized international standing, (b) has become an Affiliate of NEG or (c) has developed a conflict of interest that reasonably calls into question such firm's
capacity to exercise independent judgment. If the Fuel Consultant is removed or resigns and thereby ceases to act as Fuel Consultant for purposes of this Agreement, the Majority
Banks and Borrower shall, within 30 days of such removal or resignation, jointly designate a replacement fuel consulting firm from the list contained in  Exhibit O hereto and, thereafter,
Administrative Agent shall promptly notify the Banks and the Lender Group Agents on behalf of their respective
Lender Groups of such designation. At any time and from time to time, the Majority Banks shall have the right to add to Exhibit O hereto one or
more independent fuel consulting firms and shall notify Borrower and the Banks of any such addition. Exhibit O hereto shall automatically be
deemed amended to reflect such addition unless, within 30 days of such notification, Borrower notifies Administrative Agent that it objects, on the basis of the criteria set out in clauses
(a) through (c) above for removal of the Fuel Consultant, to the firm or firms so added. 

        At
any time while the Obligations are outstanding, Administrative Agent, the Arrangers, the Banks and the Lender Group Members shall have the right, but shall not be obligated (other
than as expressly provided herein or in the other Credit Documents), to consult with the Fuel Consultant on matters related to this Agreement or any other Credit Document. All reasonable fees and
expenses of the Fuel Consultant (whether the original one or replacements) shall be paid by Borrower. 

        10.1.4    Power Market Consultant.    For purposes of this Agreement, the "Power Market
Consultant" shall be Pace Global Energy Services, LLC or such other replacement power market consulting firm selected in accordance with this  Section 10.1. Borrower or the
Majority Banks may remove the Power Market Consultant in the event that such Power Market Consultant
(a) ceases to be a power market consulting firm of recognized international standing, (b) has become an Affiliate of NEG or (c) has developed a conflict of interest that
reasonably calls into question such 

92

 

firm's capacity to exercise independent judgment. If the Power Market Consultant is removed or resigns and thereby ceases to act as Power Market Consultant for purposes of this Agreement, the
Majority Banks and Borrower shall, within 30 days of such removal or resignation, jointly designate a replacement power market consulting firm from the list contained in  Exhibit P hereto and,
thereafter, Administrative Agent shall promptly notify the Banks and the Lender Group Agents on behalf of their respective
Lender Groups of such designation. At any time and from time to time, the Majority Banks shall have the right to add to Exhibit P hereto one or
more independent power market consulting firms and shall notify Borrower, the Banks and the Lender Group Agents on behalf of their respective Lender Groups of any such addition.  Exhibit P hereto
shall automatically be deemed amended to reflect such addition unless, within 30 days of such notification, Borrower
notifies Administrative Agent that it objects, on the basis of the criteria set out in clauses (a) through (c) above for removal of the Power Market Consultant, to the firm or firms so
added. 

        At
any time while the Obligations are outstanding, Administrative Agent, the Arrangers, the Banks and the Lender Group Members shall have the right, but shall not be obligated (other
than as expressly provided herein or in the other Credit Documents), to consult with the Power Market Consultant on matters related to this Agreement or any other Credit Document. All reasonable fees
and expenses of the Power Market Consultant (whether the original one or replacements) shall be paid by Borrower. 

        10.2    Duties.    Each Independent Consultant shall be contractually obligated to Administrative Agent to carry out
the activities required of it in this Agreement and as otherwise requested by Administrative
Agent and shall be responsible solely to Administrative Agent. Borrower acknowledges that it will not have any cause of action or claim against any Independent Consultant resulting from any decision
made or not made, any action taken or not taken or any advice given by such Independent Consultant in the due performance in good faith of its duties to Administrative Agent, except to the extent
arising from such Independent Consultant's gross negligence or willful misconduct. 

        10.3    Independent Consultants' Certificates.    

        10.3.1    Until
the receipt by Administrative Agent of certificates satisfactory to Administrative Agent from each Independent Consultant whom Administrative Agent considers
necessary or appropriate certifying Completion, Borrower shall provide such documents and information to the Independent Consultants as any of the Independent Consultants may reasonably consider
necessary in order for the Independent Consultants to deliver to Administrative Agent the following certificates and reports: 

        (a)  all
certificates to be delivered pursuant to this Agreement or any other Credit Document; and 

        (b)  monthly
after the Closing Date, from the Independent Engineer, a full report and status of the progress of each Approved Project to that date, a complete assessment of
Project Costs to Completion of such Approved Project and such other information and certification as Administrative Agent may reasonably require from time to time. 

        10.3.2    Following
Completion of each Approved Project, Borrower shall provide such documents and information to the Independent Consultants (subject to the execution by such
Independent Consultants of confidentiality agreements reasonably acceptable to Administrative Agent and Borrower) as they may reasonably consider necessary in order for the Independent Consultants to
deliver annually to Administrative Agent a certificate setting forth a full report on the status of such Approved Project and such other information and certification as Administrative Agent may
reasonably require from time to time. 

        10.4    Certification of Dates.    Administrative Agent will request that the Independent Consultants act diligently
in the issuance of all certificates required to be delivered by the Independent Consultants 

93

 

hereunder, if their issuance is appropriate. Borrower shall provide the Independent Consultants with reasonable notice of the expected occurrence of any such dates or events requiring any such
certification. 

ARTICLE 11.
  MISCELLANEOUS  

        11.1    Addresses.    Any communications between the parties hereto or notices provided herein to be given may be
given to the following addresses: 

	If to Administrative Agent:	 	Société Générale

1221 Avenue of the Americas, 11th Floor

New York, New York 10020

Attn: Robert Preminger

Telephone No.: (212) 278-5703

Facsimile No.: (212) 278-6136/6148
	

If to Borrower:	
 	

GenHoldings I, LLC

7500 Old Georgetown Road, 13th Floor

Bethesda, Maryland 20814

Attn: General Counsel

Telephone No.: (301) 280-6800

Facsimile No.: (301) 280-6900

        All
notices or other communications required or permitted to be given hereunder shall be in writing and shall be considered as properly given (a) if delivered in person,
(b) if sent by overnight delivery service (including Federal Express, UPS, ETA, Emery, DHL, AirBorne and other similar overnight delivery services), (c) in the event overnight delivery
services are not readily available, if mailed by first class United States Mail, postage prepaid, registered or certified with return receipt requested, (d) if sent by prepaid telegram
(including singing gorilla) or by facsimile or (e) other electronic means (including electronic mail) confirmed by facsimile or telephone. Notice so given shall be effective upon receipt by the
addressee, except that communication or notice so transmitted by facsimile or other direct electronic means shall be deemed to have been validly and effectively given on the day (if a Banking Day and,
if not, on the next following Banking Day) on which it is transmitted if transmitted before 4:00 p.m., recipient's time, and if transmitted after that time, on the next following Banking Day;  provided, however, that if any notice is tendered to an addressee and the delivery thereof is refused by
such addressee, such notice shall be effective upon such tender. Any party shall have the right to change its address for notice hereunder to any other location within the continental United States by
giving of 30 days' notice to the other parties in the manner set forth above. 

        11.2    Additional Security; Right to Set-Off.    Any deposits or other sums at any time credited or due
from the Banks or the Lender Groups and any Project Revenues, securities or other property of Borrower in the possession of Administrative Agent may at all times be treated as collateral security for
the payment of the Loans and the Notes and all other obligations of Borrower to the Banks and the Lender Groups (and the members thereof) under this Agreement and the other Credit Documents, and
Borrower hereby pledges to Administrative Agent, for the benefit of Secured Parties, and grants Administrative Agent a security interest in and to all such deposits, sums, securities or other
property. Regardless of the adequacy of any other collateral, any Bank or any Affiliate thereof and any Lender Group (and any member thereof) (but only with the prior written consent of Administrative
Agent) may execute or realize on the Banks' or the Lender Groups' security interest in any such deposits or other sums credited by or due from the Banks or the Lender Groups to Borrower, may apply any
such 

94

 

deposits or other sums to or set them off against Borrower's obligations to the Banks or the Lender Groups under the Notes, this Agreement and the other Credit Documents at any time after the
occurrence and during the continuation of any Borrower Event of Default. This Section 11.2 shall not apply to any Cash Secured Advance Account. 

        11.3    Delay and Waiver.    No delay or omission to exercise any right, power or remedy accruing to the Banks or the
Lender Groups upon the occurrence of any Borrower Event of Default or Borrower Inchoate Default or any Project Event of Default or Project Inchoate Default or any breach or default of the Credit
Parties under this Agreement or any other Credit Document shall impair any such right, power or remedy of the Banks or the Lender Groups (or the members thereof), nor shall it be construed to be a
waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring, nor shall any waiver of any single Borrower Event of Default, Borrower
Inchoate Default, Project Event of Default or Project Inchoate Default or other breach or default be deemed a waiver of any other Borrower Event of Default, Borrower Inchoate Default, Project Event of
Default or Project Inchoate Default or other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of Administrative
Agent, the Banks and/or the Lender Groups (or the members thereof) of any Borrower Event of Default, Borrower Inchoate Default, Project Event of Default or Project Inchoate Default or other breach or
default under this Agreement or any other Credit Document, or any waiver on the part of Administrative Agent, the Banks and/or the Lender Groups (or the members thereof) of any provision or condition
of this Agreement or any other Credit Document, must be in writing and shall be effective only to the extent in such writing specifically set forth. All remedies, either under this Agreement or any
other Credit Document or by law or otherwise afforded to Administrative Agent, the Banks, the Lender Groups (and the members thereof) and the other Secured Parties shall be cumulative and not
alternative. 

        11.4    Costs, Expenses and Attorneys' Fees; Syndication.    

        11.4.1    Borrower
will pay to each of Administrative Agent, the Lead Arrangers and the Alternative Funding Arranger all of their reasonable costs and expenses in connection
with the preparation, negotiation, closing and administering of this Agreement and the documents contemplated hereby and any participation or syndication of the Loans or this Agreement, including the
reasonable fees, expenses and disbursements of Latham & Watkins, Chadbourne & Parke LLP and other associated local attorneys retained by such Persons in connection with the preparation
of such documents and any amendments hereof or thereof, or the preparation, negotiation, closing, administration, enforcement, participation or syndication of the Loans or this Agreement, the
reasonable fees, expenses and disbursements of the Independent Consultants and any other engineering, insurance and construction consultants to Administrative Agent, the Lead Arrangers and the
Alternative Funding Arranger and incurred in connection with this Agreement or the Loans subsequent to the Closing Date, and the travel and out-of-pocket costs incurred by such
Persons following the Closing Date, and Borrower further agrees to pay Administrative Agent, the Lead Arrangers and the Alternative Funding Arranger the out-of-pocket costs and
travel costs incurred by such Persons in connection with syndication of the Loans or this Agreement; provided,  however, Borrower shall not be required to
pay advertising costs of any of the Banks or the Lender Groups (or the members thereof) or the fees of the
Banks' or Lender Groups' attorneys, other than Latham & Watkins (or one replacement counsel therefor if Latham & Watkins is unable or unwilling to act a counsel for the Banks and Lender
Groups), Chadbourne & Parke LLP (or one replacement counsel therefor if Chadbourne & Parke LLP is unable or unwilling to act a counsel for the Banks and Lender Groups) and associated
local counsel, or the fees and costs of any engineers or consultants other than the Independent Engineer and the other Independent Consultants engaged by Administrative Agent. Without limiting the
foregoing, Borrower will reimburse Administrative Agent, the Arrangers, each Bank, the LC Bank, each Lender Group Agent and each Lender Group Member for all costs and expenses, including 

95

 

reasonable attorneys' fees, expended or incurred by such Persons in enforcing this Agreement or the other Credit Documents in connection with a Borrower Event of Default or Borrower Inchoate Default,
in actions for declaratory relief in any way related to this Agreement or in collecting any sum which becomes due such Persons on the Notes or under the Credit Documents. 

        11.4.2    In
connection with syndication of the Loans and Commitments, an information package containing certain relevant information concerning Borrower, the Projects, the
other Project participants and the transactions contemplated hereby has been provided to potential Banks and participants. Borrower agrees to cooperate in the syndication of the Loans and Commitments
in all respects, as reasonably requested by Administrative Agent or the Arrangers, including participation in bank meetings held in connection with such syndication, and to provide, for inclusion in
any additional package, all information which such Persons may request from it or which such Persons or Borrower may consider material to a lender or participant, or necessary or appropriate for
accurate and complete disclosure. 

        11.5    Entire Agreement.    This Agreement and any agreement, document or instrument attached hereto or referred to
herein integrate all the terms and conditions mentioned herein or incidental hereto and supersede all oral negotiations and prior writings in respect to the subject matter hereof. In the event of any
conflict between the terms, conditions and provisions of this Agreement and any such other agreement, document or instrument, the terms, conditions and provisions of this Agreement shall prevail. This
Agreement and the other Credit Documents may only be amended or modified by an
instrument in writing signed by Borrower, Administrative Agent and any other parties to such agreements or as otherwise set forth herein and in the other Credit Documents. 

        11.6    Governing Law.    This Agreement, and any instrument or agreement required hereunder (to the extent not
otherwise expressly provided for therein), shall be governed by, and construed under, the laws of the State of New York, without reference to conflicts of laws (other than
Section 5-1401 of the New York General Obligations Law). 

        11.7    Severability.    In case any one or more of the provisions contained in this Agreement should be invalid,
illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 

        11.8    Headings.    Article and Section headings have been inserted in this Agreement as a matter of convenience for
reference only and such article and section headings shall not be used in the interpretation of any provision of this Agreement. 

        11.9    Accounting Terms.    All accounting terms not specifically defined herein shall be construed in accordance
with GAAP and practices consistent with those applied in the preparation of the financial statements submitted by Borrower to Administrative Agent, and all financial data submitted pursuant to this
Agreement shall be prepared in accordance with such principles and practices. 

        11.10    Additional Financing.    The parties hereto acknowledge no Bank and no Lender Group (and no member thereof)
has made any agreement or commitment to provide any financing to any Credit Party except as set forth herein. 

        11.11    No Partnership, Etc.    The Banks, the Lender Groups (and the members thereof) and Borrower intend that the
relationship between them shall be solely that of creditor and debtor. Nothing contained in this Agreement, the Notes or any other Credit Document shall be deemed or construed to create a partnership,
tenancy-in-common, joint tenancy, joint venture or co-ownership by or between the Banks, the Lender Groups (and the members thereof), Borrower or any other Person.
The Banks and the Lender Groups (and the members thereof) shall not be in any way responsible or liable for the debts, losses, obligations or duties of the Credit Parties or any other Person with
respect to any Project or otherwise. All obligations to pay real property or other taxes, assessments, insurance premiums and all other fees and charges arising from the ownership, operation or
occupancy of any Project, and to 

96

 

perform all obligations and other agreements and contracts relating to any Project or any other asset or liability of any Credit Party, shall be the sole responsibility of the Credit Parties. 

        11.12    Collateral Documents.    The Guaranteed Obligations (as defined in each of the Project Company Guaranties)
are or will be secured in part by the Mortgages encumbering certain properties associated with the Approved Projects in such Projects' respective states. Reference is hereby made to the Mortgages and
the other Collateral Documents for the provisions, among others, relating to the nature and extent of the security provided thereunder, the rights, duties and obligations of the Credit Party and the
rights of Administrative Agent, the Banks and the Lender Groups (and the members thereof) with respect to such security. 

        11.13    Limitation on Liability.    No claim shall be made by any Credit Party, any Equity Party or any of their
Affiliates against Administrative Agent, the Arrangers, the Banks, the Lender Groups (and the members thereof), any other Secured Party or any of their Affiliates, directors, employees, attorneys or
agents for any special, indirect, consequential or punitive damages in respect of any breach or wrongful conduct (whether or not the claim therefor is based on contract, tort or duty imposed by law),
in connection with, arising out of or in any way related to the transactions contemplated by this Agreement or the other Operative Documents or any act or omission or event occurring in connection
therewith; and Borrower hereby waives, releases and agrees not to sue upon any such claim for any such damages, whether or not accrued and whether or not known or suspected to exist in its favor. 

        11.14    Waiver of Jury Trial.    THE PARTIES HERETO HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS
THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH, THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT, OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE PARTIES HERETO. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE BANKS AND THE LENDER GROUPS (AND THE MEMBERS THEREOF) TO
ENTER INTO THIS AGREEMENT. 

        11.15    Consent to Jurisdiction.    The Banks, the Lender Groups (and the members thereof) and Borrower agree that
any legal action or proceeding by or against Borrower or with respect to or arising out of this Agreement, the Notes, or any other Credit Document may be brought in or removed to the courts of the
State of New York, in and for the County of New York, or of the United States of America for the Southern District of New York, as Administrative Agent may elect. By execution and delivery of the
Agreement, the Banks, the Lender Groups (and the members thereof) and Borrower accept, for themselves and in respect of their property, generally and unconditionally, the jurisdiction of the aforesaid
courts. The Banks, the Lender Groups (and the members thereof) and Borrower irrevocably consent to the service of process out of any of the aforementioned courts in any manner permitted by law.
Nothing herein shall affect the right of Administrative Agent to bring legal action or proceedings in any other competent jurisdiction, including judicial or non-judicial foreclosure of
any Mortgage. The Banks, the Lender Groups (and the members thereof) and Borrower further agree that the aforesaid courts of the State of New York and of the United States of America shall have
exclusive jurisdiction with respect to any claim or counterclaim of Borrower based upon the assertion that the rate of interest charged by the Banks or the Lender Groups (and the members thereof) on
or under this Agreement, the Loans and/or the other Credit Documents is usurious. The Banks, the Lender Groups (and the members thereof) and Borrower hereby waive any right to stay or dismiss any
action or proceeding under or in connection with any or all of any Initial Project, Substitute Project, Approved Project, this Agreement or any other Credit Document brought before the foregoing
courts on the basis of forum non-conveniens. 

        11.16    Usury.    Nothing contained in this Agreement or the Notes shall be deemed to require the payment of interest
or other charges by Borrower or any other Person in excess of the amount which 

97

 

the holders of the Notes may lawfully charge under any applicable usury laws. In the event that the Banks or the Lender Groups shall collect moneys which are deemed to constitute interest which would
increase the effective interest rate to a rate in excess of that permitted to be charged by applicable Legal Requirements, all such sums deemed to constitute interest in excess of the legal rate
shall, upon such determination, at the option of the Banks and the Lender Groups, be returned to Borrower or credited against the principal balance then outstanding. 

        11.17    Successors and Assigns.    The provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns. Borrower may not assign or otherwise transfer any of its rights under this Agreement except as provided in  Section 6.14, and the
Banks and the Lender Groups (and the members thereof) may not assign or otherwise transfer any of their rights under this
Agreement except as provided in Article 9. 

        11.18    Counterparts.    This Agreement and any amendments, waivers, consents or supplements hereto or in connection
herewith 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 instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature
pages are physically attached to the same document. 

        11.19    Survival.    All representations, warranties, covenants and agreements made herein and in the certificates or
other instruments delivered in connection with or pursuant to this Agreement and the other Credit Documents shall be considered to have been relied upon by the parties hereto and shall survive the
execution and delivery of this Agreement, the other Credit Documents and the making of the Loans. Notwithstanding anything in this Agreement or implied by law to the contrary, the agreements of
Borrower set forth in Sections 2.5.4, 2.7.4, 2.8,  5.8,
9.1, 9.8,  10.1 and 11.4 and the agreements of the Banks and
the Lender Groups set forth in  Sections 9.1, 9.5, 9.10.2,
12.12 and 12.13 shall survive the payment and performance of the Loans and other Obligations and the
reimbursement of any amounts drawn thereunder, and the termination of this Agreement. 

ARTICLE 12.
  LENDER GROUP AGENTS  

        12.1    Appointment, Powers and Immunities.    

        12.1.1    Each
Lender Group Member hereby appoints and authorizes the Person designated as Lender Group Agent on such Lender Group's respective signature page hereto to act as
its agent hereunder and under the other Credit Documents with such powers as are expressly delegated to a Lender Group Agent with respect to such Lender Group (and the Lender Group Members thereof) by
the terms of this Agreement and the other Credit Documents, together with such other powers as are reasonably incidental thereto. No Lender Group Agent shall have any duties or responsibilities except
those expressly set forth in this Agreement or in any other Credit Document, or be a trustee or a fiduciary for any Bank, any Lender Group or any Lender Group Member (including the Related Bank and
the CP Conduit that are members of its respective Lender Group). Notwithstanding anything to the contrary contained herein, no Lender Group Agent shall be required to take any action which is contrary
to this Agreement or any other Credit Documents or any Legal Requirement or exposes such Lender Group Agent to any liability. No Lender Group Agent nor any of its Affiliates shall be responsible to
any Bank, and Lender Group or any Lender Group Member (including the Related Bank and the CP Conduit that are members of its respective Lender Group) for any recitals, statements, representations or
warranties made by any Equity Party, Borrower, any other Credit Party or any of their Affiliates contained in this Agreement, the Credit Documents or in any certificate or other document referred to
or provided for in, or received by such Lender Group Agent under the Credit Documents, for the value, 

98

 

validity, effectiveness, genuineness, enforceability or sufficiency of the Credit Documents, the Notes or any other document referred to or provided for herein or for any failure by any Equity Party,
Borrower, any other Credit Party or any of their Affiliates to perform their respective obligations hereunder or thereunder. Each Lender Group Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct of any such agents or attorneys-in-fact selected by it with reasonable
care. 

        12.1.2    No
Lender Group Agent or its directors, officers, employees and agents shall be responsible for any action taken or omitted to be taken by it or them hereunder or
under any other Credit Document or in connection herewith or therewith, except for their own gross negligence or willful misconduct. Without limiting the generality of the foregoing, each Lender Group
Agent (a) may consult with legal counsel, independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by
them in accordance with the advice of such counsel, accountants or experts; (b) makes no warranty or representation to any Bank, any Lender Group or any Lender Group Member (including the
Related Bank and the CP Conduit that are members of its respective Lender Group) for any statements, warranties or representations made in or in connection with any Operative Document;
(c) shall not have any duty to ascertain or to inquire as to the performance or observance of any of the terms, covenants or conditions of any Operative Document on the part of any party
thereto or to inspect the property (including the books and records) of any Credit Party or any other Person; and (d) shall not be responsible to any Bank, any Lender Group or any Lender Group
Member (including the Related Bank and the CP Conduit that are members of its respective Lender Group) for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of
any Operative Document or any other instrument or document furnished pursuant hereto. Except as otherwise provided under this Agreement, each Lender Group Agent shall take such action with respect to
the Credit Documents as shall be directed by its respective Lender Group. 

        12.2    Reliance by Lender Group Agents.    Each Lender Group Agent shall be entitled to rely upon any certificate,
notice or other document (including any cable, telegram, facsimile or telex) believed by it to be genuine and correct and to have been signed or sent by or on behalf of the proper Person or Persons,
and upon advice and statements of legal counsel, independent accountants and other experts selected by such Lender Group Agent. As to any other matters not expressly provided for by this Agreement,
each Lender Group Agent shall not be required to take any action or exercise any discretion, but shall be required to act or to refrain from acting upon instructions of its respective Lender Group
(except that no Lender Group Agent shall be required to take any action which exposes such Lender Group Agent to personal liability or which is contrary to this Agreement, any other Credit Document or
any Legal Requirement) and shall in all cases be fully protected in acting, or in refraining from acting, hereunder or under any other Credit Document in accordance with the instructions of its
respective Lender Group, and such Lender Group's instructions and any action taken or failure to act pursuant thereto shall be binding on all of the members of such Lender Group. 

        12.3    Non-Reliance.    Each Lender Group Member represents that it has, independently and without
reliance on its respective Lender Group Agent, and based on such documents and information as it has deemed appropriate, made its own appraisal of the financial condition and affairs of the Credit
Parties and decision to enter into this Agreement and agrees that it will, independently and without reliance upon its respective Lender Group Agent, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own appraisals and decisions in taking or not taking action under this Agreement. No Lender Group Agent shall be required to keep informed as
to the performance or observance by any Equity Party, Borrower, any other Credit Party or any of their Affiliates under this Agreement or any other document referred to or provided for herein or to
make inquiry of, or to inspect the properties or books of any Equity Party, Borrower, any other Credit Party or any of their Affiliates. 

99

 

        12.4    Defaults.    No Lender Group Agent shall be deemed to have knowledge or notice of the occurrence of any NEG
Trigger Event, Borrower Inchoate Default, Borrower Event of Default, Project Event of Default or Project Inchoate Default unless such Lender Group Agent has received a notice from the Administrative
Agent, a Lender Group Member of its respective Lender Group or Borrower, referring to this Agreement, describing such NEG Trigger Event, Borrower Inchoate Default, Borrower Event of Default, Project
Event of Default or Project Inchoate Default and indicating that such notice is a notice of default or notice of NEG Trigger Event. If a Lender Group Agent receives such a notice of the occurrence of
a NEG Trigger Event, Borrower Inchoate Default, Borrower Event of Default, Project Event of Default or Project Inchoate Default, such Lender Group Agent shall give notice thereof to the Lender Group
Members of its respective Lender Group, Administrative Agent and Borrower (except to the extent such Person sent notice of such occurrence to such Lender Group Agent. Each Lender Group Agent shall
take such action with respect to any NEG Trigger Event, Borrower Inchoate Default or Borrower Event of Default as is provided in Article 7 or if
not provided for in Article 7, as such Lender Group Agent shall be reasonably directed by its respective Lender Group;  provided, however, unless and until such Lender Group Agent shall have received such directions, such
Lender Group Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such NEG Trigger Event, Borrower Inchoate Default or Borrower Event of
Default as it shall deem advisable in the best interest of its Lender Group. 

        12.5    Indemnification.    Without limiting any Obligation of any of Credit Party hereunder, each Related Bank agrees
to indemnify its respective Lender Group Agent and its officers, directors, shareholders, controlling Persons, employees, agents and servants, for any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may at any time be imposed on, incurred by or asserted against its respective
Lender Group Agent or any such Person in any way relating to or arising out of this Agreement or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby
or thereby or the enforcement of any of the terms hereof or thereof or of any such other documents (to the extent Borrower has not paid any such amounts pursuant to  Section 5.8); provided, however, that no Related
Bank shall be liable for any of the foregoing to the extent they arise from a Lender Group Agent's or such Person's gross negligence or willful misconduct. Each Lender Group Agent shall be fully
justified in refusing to take or to continue to take any action hereunder unless it shall first be indemnified to its satisfaction by its respective Related Bank against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take any such action. Without limitation of the foregoing, each Related Bank agrees to reimburse its respective Lender Group
Agent and promptly upon demand for any out-of-pocket expenses (including counsel fees) incurred by its Lender Group Agent in connection with the preparation, execution,
administration or enforcement of, or legal advice in respect of rights or responsibilities under, the Operative Documents, to the extent that such Lender Group Agent is not reimbursed for such
expenses by Borrower. 

        12.6    Successor Lender Group Agent.    Each Lender Group Agent acknowledges that its current intention is to remain
the Lender Group Agent for its respective Lender Group hereunder. Nevertheless, each Lender Group Agent may resign at any time by giving 15 days written notice thereof to each of the members of
its Lender Group, Administrative Agent and Borrower. Each Lender Group Agent may be removed involuntarily only for a material breach of its duties and obligations hereunder or under the other Credit
Documents or for gross negligence or willful misconduct in connection with the performance of its duties hereunder or under the other Credit Documents and then only upon the affirmative vote of its
respective Lender Group. Upon any such resignation or removal, such Lender Group, with the consent of Administrative Agent, and Borrower if no Borrower Inchoate Default under  Section 7.1.1 or
Borrower Event of Default has occurred and is continuing (such consents not to be unreasonably withheld or delayed), shall have
the right to appoint a successor Lender Group Agent for such Lender Group. If no successor Lender Group Agent shall have been so appointed, and shall have accepted such appointment, within
30 days after the retiring Lender Group Agent's giving of notice of 

100

 

resignation or such Lender Group Agent's removal by its respective Lender Group, the retiring Lender Group Agent may, on behalf of its Lender Group, with the consent of Administrative Agent and
Borrower if no Borrower Inchoate Default under Section 7.1.1 or Borrower Event of Default has occurred as is continuing (such consent not to be
unreasonably withheld or delayed), appoint a successor Lender Group Agent, which shall be a commercial bank having a combined capital and surplus of at least $500,000,000. Upon the acceptance of any
appointment as a Lender Group Agent under the Operative Documents by a successor Lender Group Agent, such successor Lender Group Agent shall thereupon succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Lender Group Agent, and the retiring Lender Group Agent shall be discharged from its duties and obligations as a Lender Group Agent. After any retiring
Lender Group Agent's resignation or removal hereunder as a Lender Group Agent, the provisions of this Article 12 shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was a Lender Group Agent under the Operative Documents. 

        12.7    Authorization.    Each Lender Group Agent is hereby authorized by its respective Lender Group to execute and
deliver each of the documents and to perform each of the actions delegated to such Lender Group Agent under this Agreement and the Credit Documents. Each Lender Group Member of the applicable Lender
Group agrees to be bound by all of such agreements and duly authorized actions undertaken by its respective Lender Group Agent. 

        12.8    Lender Group Agent as a Bank or Related Bank.    With respect to its Commitments, the Loans made by it and any
Note issued to it, each financial institution acting as a Lender Group Agent shall have the same rights and powers under the Operative Documents as any other Bank or Related Bank and may exercise the
same as though it were not a Lender Group Agent. The terms "Bank", "Banks", "Related Bank" and "Related Banks" shall, unless otherwise expressly indicated, include each Lender Group Agent in its
individual capacity. Each financial institution acting as a Lender Group Agent and its Affiliates may accept deposits from, lend money to, act as trustee under indentures of, and generally engage in
any kind of business with Borrower or any other Person, without any duty to account therefor to the Banks, the Lender Groups or the Lender Group Members (including the Related Bank and the CP Conduit
that are members of its respective Lender Group). 

        12.9    Withholding Tax.    

        12.9.1    A
Lender Group Agent may withhold from any interest payment to any Related Bank or any CP Conduit that is a Lender Group Member of its Lender Group an amount
equivalent to any applicable withholding tax. If the forms or other documentation required by Section 2.5 are not delivered to the applicable Lender Group Agent, then such Lender Group Agent
may withhold from any interest payment to any Related Bank or any CP Conduit that is a Lender Group Member of its Lender Group not providing such forms or other documentation, an amount equivalent to
the applicable withholding tax. 

        12.9.2    If
the Internal Revenue Service or any authority of the United States or other jurisdiction asserts a claim that a Lender Group Agent did not properly withhold tax
from amounts paid to or for the account of any Related Bank or CP Conduit that is a Lender Group Member of its Lender Group (because the appropriate form was not delivered, was not properly executed,
or because such Related Bank or such CP Conduit failed to notify such Lender Group Agent of a change in circumstances which rendered the exemption from, or reduction of, withholding tax ineffective,
or for any other reason), such Related Bank shall indemnify such Lender Group Agent fully for all amounts paid, directly or indirectly, by Administrative Agent as tax or otherwise, including penalties
and interest, together with all expenses incurred, including legal expenses, allocated staff costs and any out of pocket expenses. 

        12.10    General Provisions as to Payments.    Each Lender Group Agent shall promptly distribute (i) to each
Related Bank each payment of Construction Loan Commitment Fees received by such 

101

 

Lender Group Agent, (ii) to each Related Bank and each CP Conduit that is a Lender Group Member of its respective Lender Group, its share of each payment of principal and interest payable to
such Lender Group on the Construction Loans of such Lender Group in accordance with the provisions of Section 2.6.3, and (iii) to each
Related Bank and each CP Conduit that is a Lender Group Member of its respective Lender Group, its share of each payment of any other amounts owing under this Agreement. 

        12.11    Action by Lender Group.    Any action to be taken by, or approval or consent to be granted by, or direction
or instruction to be given by, a Lender Group under this Agreement or any of the other Credit Documents shall be at the direction of the Related Bank that is a member of such Lender Group, and such
Related Bank's instructions and any action taken or failure to act pursuant thereto shall be binding the CP Conduit that is a member of such Lender Group. 

        12.12    No Petition.    Each Person party to this Agreement agrees that, prior to the date which is one year and one
day after the date upon which all Obligations of the Borrower and the other Credit Parties under this Agreement and the other Credit Documents to a CP Conduit are paid in full and all outstanding
commercial paper and other promissory notes and indebtedness of such CP Conduit, and of any Asset Securitization Company with respect to such CP Conduit, are paid in full, it will not institute
against, or join any other Person in instituting against, such CP Conduit or such Asset Securitization Company any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or
other similar proceeding under the Laws of the United States or any state of the United States. 

        12.13    No Recourse.    The obligations of any CP Conduit under this Agreement are solely the corporate, company or
partnership obligations, as the case may be, of such CP Conduit. No recourse to or against any employee, officer, director, shareholder, member, partner, Affiliate or agent of such CP Conduit shall be
had for the payment of any amount owing by such CP Conduit under this Agreement or any other Credit Document, or for the payment by such CP Conduit of any other obligation or claim of or against such
CP Conduit arising out of or based upon this Agreement or any other Credit Document. Notwithstanding any other provision of this Agreement or any other Credit Document to the contrary, each CP Conduit
shall be required to pay any amount owing to the applicable Lender Group Agent, the Administrative Agent or Borrower in respect of any obligation to make or maintain CP Conduit Construction Loans, and
any other amounts owed to any Person by such CP Conduit under the Credit Documents, only to the extent such CP Conduit has funds in excess of the amounts necessary to pay all amounts owing to holders
of its commercial paper or other promissory notes or indebtedness or to the applicable Asset Securitization Company, and interest thereon (such excess funds being referred to in this  Section 12.13
as "Excess Funds"). In the event any CP Conduit does not have Excess Funds in an
amount sufficient to pay in full such amounts due under this Agreement or any other Credit Document, (i) the excess of the amounts payable by such CP Conduit over the amount of Excess Funds
shall not constitute a claim (as defined in Section 101(5) of the Bankruptcy Law) against such CP Conduit until such time, if any, as such CP Conduit has Excess Funds in an amount equal to such
excess, and (ii) the applicable Related Bank shall make up any such excess not otherwise paid by such CP Conduit. 

[SIGNATURE
PAGES FOLLOW] 

102

   
        IN WITNESS WHEREOF, the parties hereto, by their officers duly authorized, intending to be legally bound, have caused this Amended and Restated Credit Agreement to be duly executed and
delivered as of the date first written above. 

	 	 	GENHOLDINGS I, LLC,

a Delaware limited liability company,

as Borrower

    
	

 	
 	

By:	

 
	 	 	 	

	 	 	Name:	 
	 	 	Title:

    	 
	

 	
 	

  

Additional signature pages omitted
	 	 	 	 
	 	 	 	 

S-1

[GenHoldings I, LLC - Amended and Restated Credit Agreement]

QuickLinks

Exhibit 10.9

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00047-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00047-of-00352.parquet"}]]