Document:

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                                                                    Exhibit 10.4

                               PLACEMENT AGREEMENT

                                      AMONG

                          BLUE RIVER BANCSHARES, INC.,

                          BLUE RIVER BANCSHARES TRUST I

                                       AND

                           J.P. MORGAN SECURITIES INC.

                                   ----------

                           Dated as of April 20, 2006

                                   ----------

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                           Blue River Bancshares, Inc.

                         $7,000,000 Preferred Securities

                       Floating Rate Preferred Securities
               (Liquidation Amount $1,000 per Preferred Security)

                               PLACEMENT AGREEMENT

                                   ----------

                                                                  April 20, 2006

J.P. Morgan Securities Inc.
270 Park Avenue
New York, New York 10017

Ladies and Gentlemen:

     Blue River Bancshares, Inc., an Indiana corporation (the "Company"), and
its financing subsidiary, Blue River Bancshares Trust I, a Delaware statutory
trust (the "Trust," and hereinafter together with the Company, the "Offerors"),
hereby confirm their agreement (this "Agreement") with you as placement agent
(the "Placement Agent"), as follows:

Section 1. Issuance and Sale of Securities.

     1.1 Introduction. The Offerors propose to issue and sell at the Closing (as
defined in Section 2.3.1 hereof) SEVEN MILLION AND 00/100 ($7,000,000) DOLLARS
of the Trust's Floating Rate Preferred Securities, with a liquidation amount of
$1,000 per preferred security, bearing a variable rate of interest per annum,
reset quarterly, equal to LIBOR (as defined in the Indenture (as defined below))
plus 1.55% (the "Preferred Securities"), directly or indirectly, to TWE, Ltd.,
an exempted company incorporated under the laws of the Cayman Islands (the
"Purchaser"), pursuant to the terms of the Preferred Securities Subscription
Agreement entered into, or to be entered into on or prior to the Closing Date
(as defined in Section 2.3.1 hereof), between the Offerors and the Purchaser
(the "Subscription Agreement"), the form of which is attached hereto as Exhibit
A and incorporated herein by this reference.

     1.2 Operative Agreements. The Preferred Securities shall be fully and
unconditionally guaranteed on a subordinated basis by the Company with respect
to distributions and amounts payable upon liquidation, redemption or repayment
(the "Guarantee") pursuant and subject to the Guarantee Agreement (the
"Guarantee Agreement"), to be dated as of the Closing Date and executed and
delivered by the Company and Wilmington Trust Company, as guarantee trustee (the
"Guarantee Trustee"), for the benefit from time to time of the holders of the
Preferred Securities. The entire proceeds from the sale by the Trust to the
holders of the Preferred Securities shall be combined with the entire proceeds
from the sale by the Trust to the Company of its common securities (the "Common
Securities"), and shall be used by the Trust to

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purchase SEVEN MILLION TWO HUNDRED SEVENTEEN THOUSAND AND 00/100 ($7,217,000)
DOLLARS in principal amount of the Floating Rate Junior Subordinated Notes (the
"Junior Subordinated Notes") of the Company. The Preferred Securities and the
Common Securities of the Trust shall be issued pursuant to an Amended and
Restated Trust Agreement among Wilmington Trust Company, as property trustee
(the "Property Trustee"), and as Delaware trustee (the "Delaware Trustee") the
Administrative Trustees named therein and the Company, to be dated as of the
Closing Date and in substantially the form heretofore delivered to the Placement
Agent (the "Trust Agreement"). The Junior Subordinated Notes shall be issued
pursuant to an Indenture (the "Indenture"), to be dated as of the Closing Date,
between the Company and Wilmington Trust Company, as indenture trustee (the
"Indenture Trustee"). The documents identified in this Section 1.2 and in
Section 1.1 are referred to herein as the "Operative Documents." The Preferred
Securities, the Common Securities and the Junior Subordinated Notes are
collectively referred to as the "Securities." All other capitalized terms used
but not defined in this Agreement shall have the meanings ascribed to them in
the Indenture.

     1.3 Rights of Purchaser. The Preferred Securities shall be offered and sold
by the Trust, directly or indirectly, to the Purchaser without registration of
any of the Preferred Securities, the Junior Subordinated Notes or the Guarantee
under the Securities Act of 1933, as amended (the "Securities Act"), or any
other applicable securities laws in reliance upon exemptions from the
registration requirements of the Securities Act and other applicable securities
laws. The Offerors agree that this Agreement shall be incorporated by reference
into the Subscription Agreement and the Purchaser shall be entitled to each of
the benefits of the Placement Agent and the Purchaser under this Agreement
(except for the rights of the Placement Agent under Sections 2.1 and 2.4.1 of
this Agreement) and shall be entitled to enforce obligations of the Offerors
under this Agreement as fully as if the Purchaser were a party to this
Agreement. The Offerors and the Placement Agent have entered into this Agreement
to set forth their understanding as to their relationship and their respective
rights, duties and obligations.

     1.4 Legends. Upon original issuance thereof, and until such time as the
same is no longer required under the applicable requirements of the Securities
Act, the Preferred Securities and Junior Subordinated Notes certificates shall
each contain a legend as required pursuant to any of the Operative Documents.

Section 2. Purchase of Preferred Securities.

     2.1 Exclusive Rights; Purchase Price. From the date hereof until the
Closing Date (which date may be extended by mutual agreement of the Offerors and
the Placement Agent), the Offerors hereby grant to the Placement Agent the
exclusive right to arrange for the sale to the Purchaser of the Preferred
Securities at a purchase price equal to $1,000 per Preferred Security. The
aggregate purchase price shall be SEVEN MILLION AND 00/100 ($7,000,000) DOLLARS
(the "Purchase Price"), which Purchase Price is equal to 100% of the stated
liquidation amount of the Preferred Securities.

     2.2 Subscription. The Offerors hereby agree to evidence their acceptance of
the subscription by countersigning a copy of the Subscription Agreement and
returning the same to the Placement Agent.

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     2.3 Closing and Delivery of Payment.

     2.3.1 Closing; Closing Date. The closing (the "Closing") for the sale and
purchase of the Preferred Securities by the Offerors to the Purchaser shall
occur at the offices of Thacher Proffitt & Wood LLP, Two World Financial Center,
New York, New York 10281, or such other place as the parties hereto shall agree
at 11:00 a.m. (New York time) on April 20, 2006, or such other later date (not
later than May 19, 2006) as the parties may designate (such date and time of
delivery and payment for the Preferred Securities being herein called the
"Closing Date"). The Preferred Securities shall be transferred and delivered to
the Purchaser or its designee against the payment of the Purchase Price to the
Offerors in immediately available funds on the Closing Date to a U.S. account
designated in writing by the Company at least two (2) business days prior to the
Closing Date.

     2.3.2 Delivery. Delivery of the Preferred Securities shall be made at such
location, and in such names and denominations, as the Purchaser shall designate
at least two (2) business days in advance of the Closing Date. The Company and
the Trust agree to have the Preferred Securities available for inspection and
checking by the Purchaser in New York, New York not later than 1:00 P.M., New
York time, on the business day prior to the Closing Date.

     2.4 Placement Agents' Fees and Expenses.

     2.4.1 Placement Agents' Compensation. The Trust shall use the proceeds from
the sale of the Preferred Securities, together with the proceeds from the sale
of the Common Securities, to purchase the Junior Subordinated Notes. The Company
shall pay no fees or commissions (the "Commission") to the Placement Agent. The
Placement Agent shall be responsible for the following expenses: (i) rating
agency costs and expenses and (ii) any fee payable to the Company's introducing
agent; provided, that such introducing agent has an agreement with the Placement
Agent, but excluding the fees and expenses set forth in Section 2.4.2 hereof.

     2.4.2 Costs and Expenses. The Company hereby covenants and agrees that it
shall pay or cause to be paid (directly or by reimbursement) all costs and
expenses incident to the performance of the obligations of the Offerors under
this Agreement, whether or not the transactions contemplated herein are
consummated or this Agreement is terminated, including (i) all costs and
expenses incident to the authorization, issuance, sale and delivery of the
Preferred Securities and any taxes payable in connection therewith; (ii) the
fees and expenses of qualifying the Preferred Securities under the securities
laws of the several jurisdictions as provided in Section 6.4; (iii) the fees and
expenses of the counsel, the accountants and any other experts or advisors
retained by the Company or the Trust, which counsel fees and expenses incurred
in connection with the closing of the transactions contemplated hereby, in an
amount up to $10,000, shall be reimbursed by the Purchaser on the Closing Date;
and (iv) the fees and all reasonable expenses of the Guarantee Trustee, the
Property Trustee, the Delaware Trustee, the Indenture Trustee and any other
trustee or paying agent appointed under the Operative Documents, except for any
acceptance fee and annual administrative fees of any such trustee and the fees
and disbursements of counsel to such trustees incurred in connection with the
closing of the transactions contemplated hereby, which shall be paid by the
Purchaser.

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     2.4.3 Reimbursement of Expenses. If the sale of the Preferred Securities
provided for in this Agreement is not consummated because any condition set
forth in Section 3 to be satisfied by either the Company or the Trust is not
satisfied, because this Agreement is terminated pursuant to Section 10 or
because of any failure, refusal or inability on the part of the Company or the
Trust to perform all obligations and satisfy all conditions on its part to be
performed or satisfied hereunder other than by a reason of a default by the
Placement Agent, the Company will reimburse the Placement Agent upon demand for
all reasonable out-of-pocket expenses (including the fees and expenses of each
of the Placement Agent's or Purchaser's counsel) that shall have been incurred
by the Placement Agent or Purchaser in connection with the proposed purchase and
sale of the Preferred Securities. The Company shall not in any event be liable
to the Placement Agent or Purchaser for the loss of anticipated profits from the
transactions contemplated by this Agreement.

     2.5 Failure to Close. If any of the conditions to the Closing specified in
this Agreement shall not have been fulfilled to the reasonable satisfaction of
the Placement Agent or if the Closing shall not have occurred on or before 11:00
a.m. (New York time) on May 19, 2006, then each party hereto, notwithstanding
anything to the contrary in this Agreement, shall be relieved of all further
obligations under this Agreement without thereby waiving any rights it may have
by reason of such nonfulfillment or failure; provided, however, that the
obligations of the parties under Sections 2.4 and 8 shall not be so relieved and
shall continue in full force and effect.

Section 3. Closing Conditions. The obligations of the parties under this
Agreement on the Closing Date are subject to the following conditions:

     3.1 Accuracy of Representations and Warranties. The representations and
warranties contained in this Agreement, and the statements of the Offerors made
in any certificates pursuant to this Agreement, shall be accurate as of the date
of delivery of the Preferred Securities.

     3.2 Opinions of Counsel. On the Closing Date, the Placement Agent shall
have received the following favorable opinions or certificate, as the case may
be, each dated as of the Closing Date: (a) from Thacher Proffitt & Wood LLP,
special counsel for the Placement Agent and Purchaser and addressed to the
Placement Agent and Purchaser in substantially the form set forth on Exhibit B-1
attached hereto and incorporated herein by this reference, (b) either (i) an
opinion from Krieg DeVault LLP, counsel for the Offerors, or (ii) an opinion
from the General Counsel or Chief Legal Officer of the Company, or (iii) if the
Company does not have a General Counsel or Chief Legal Officer, an Officers'
Certificate from the Chief Executive Officer, President or Executive Vice
President of the Company, and the Chief Financial Officer, Treasurer or
Assistant Treasurer of the Company, in each case addressed to the Purchaser and
the Placement Agent in substantially the form set forth on Exhibit B-2 attached
hereto and incorporated herein by this reference, (c) from Thacher Proffitt &
Wood LLP, special tax counsel for the Placement Agent and Purchaser and
addressed to the Placement Agent and Purchaser in substantially the form set
forth on Exhibit B-3 attached hereto and incorporated herein by this reference,
(d) from Morris, James, Hitchens & Williams LLP, special Delaware counsel to the
Trust and addressed to the Purchaser, the Placement Agent and the Offerors, in
substantially the form set forth on Exhibit B-4 attached hereto and incorporated
herein by this reference, and (e) from Morris, James, Hitchens & Williams LLP,
special counsel to the Indenture Trustee, the

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Property Trustee, the Delaware Trustee and the Guarantee Trustee and addressed
to the Purchaser, the Placement Agent and the Offerors, in substantially the
form set forth on Exhibit B-5 attached hereto and incorporated herein by this
reference. Each certificate or opinion addressed to the Purchaser shall state
that the first entity, if any, to which the Purchaser transfers any of the
Preferred Securities and, if such transferee is a warehouse lender, the next
subsequent transferee that is not a warehouse lender (each, a "Subsequent
Purchaser"), shall be entitled to rely on such opinion.

     3.3 Officer's Certificate. The Company shall have furnished to the
Placement Agent and the Purchaser a certificate of the Company, signed by the
Chief Executive Officer, President or an Executive Vice President and by the
Chief Financial Officer, Treasurer or Assistant Treasurer of the Company, and
the Trust shall have furnished to the Placement Agent and the Purchaser a
certificate of the Trust, signed by an Administrative Trustee of the Trust, in
each case dated the Closing Date, and, in the case of the Company, as to 3.3.1
and 3.3.2 below and, in the case of the Trust, as to 3.3.1 below:

     3.3.1 the representations and warranties in this Agreement are true and
correct on and as of the Closing Date with the same effect as if made on the
Closing Date, and the Company and the Trust have complied with all the
agreements and satisfied all the conditions on either of their part to be
performed or satisfied at or prior to the Closing Date; and

     3.3.2 since the date of the Interim Financial Statements (as defined
below), there has been no material adverse change in the condition (financial or
other), earnings, business, prospects or assets of the Company and its
subsidiaries, whether or not arising from transactions occurring in the ordinary
course of business.

     3.4 No Subsequent Change. Subsequent to the execution of this Agreement,
there shall not have been any change, or any development involving a prospective
change, in or affecting the condition (financial or other), earnings, business,
prospects or assets of the Company and its subsidiaries, whether or not
occurring in the ordinary course of business, the effect of which is, in the
Placement Agent's or Purchaser's judgment, so material and adverse as to make it
impractical or inadvisable to proceed with the purchase of the Preferred
Securities.

     3.5 Purchase Permitted by Applicable Laws; Legal Investment. The purchase
of and payment for the Preferred Securities as described in this Agreement and
pursuant to the Subscription Agreement shall (a) not be prohibited by any
applicable law or governmental regulation, (b) not subject the Purchaser or the
Placement Agent to any penalty or, in the reasonable judgment of the Purchaser
and the Placement Agent, other onerous conditions under or pursuant to any
applicable law or governmental regulation, and (c) be permitted by the laws and
regulations of the jurisdictions to which the Purchaser and the Placement Agent
are subject.

     3.6 Consents and Permits. The Company and the Trust shall have received all
consents, permits and other authorizations, and made all such filings and
declarations, as may be required from any person or entity pursuant to any law,
statute, regulation or rule (federal, state, local and foreign), or pursuant to
any agreement, order or decree to which the Company or the Trust is a party or
to which either is subject, in connection with the transactions contemplated by
this Agreement.

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     3.7 Information. Prior to or on the Closing Date, the Offerors shall have
furnished to the Placement Agent, the Purchaser and their respective counsel
such further information, certificates, opinions and documents as the Placement
Agent, Purchaser or their respective counsel may reasonably request.

     If any of the conditions specified in this Section 3 shall not have been
fulfilled when and as required in this Agreement, or if any of the opinions,
certificates and documents mentioned above or elsewhere in this Agreement shall
not be reasonably satisfactory in form and substance to the Placement Agent, the
Purchaser or their respective counsel, this Agreement and all the Placement
Agent's obligations hereunder may be canceled at, or any time prior to, the
Closing Date by the Placement Agent. Notice of such cancellation shall be given
to the Offerors in writing or by telephone or facsimile confirmed in writing.

     Each certificate signed by any trustee of the Trust or any officer of the
Company and delivered to the Placement Agent, Purchaser or their respective
counsel in connection with the Operative Documents and the transactions
contemplated hereby and thereby shall be deemed to be a representation and
warranty of the Trust and/or the Company, as the case may be, and not by such
trustee or officer in any individual capacity.

Section 4. Representations and Warranties of the Offerors. The Offerors jointly
and severally represent and warrant to the Placement Agent and the Purchaser as
of the date hereof and as of the Closing Date as follows:

     4.1 Securities Laws Matters:

               (i) Neither the Company nor the Trust, nor any of their
"Affiliates" (as defined in Rule 501 (b) of Regulation D under the Securities
Act ("Regulation D")), nor any person acting on any of their behalf (except for
the Placement Agent, as to which neither the Company nor the Trust make any
representation) has, directly or indirectly, made offers or sales of any
security, or solicited offers to buy any security, under circumstances that
would require the registration under the Securities Act of any of the
Securities.

               (ii) Neither the Company nor the Trust, nor any of their
Affiliates, nor any person acting on its or their behalf (except for the
Placement Agent, as to which neither the Company nor the Trust make any
representation) has (i) offered for sale or solicited offers to purchase the
Securities, (ii) engaged in any form of general solicitation or general
advertising (within the meaning of Regulation D) in connection with any offer or
sale of any of the Securities, or (iii) engaged in any "directed selling
efforts" within the meaning of Regulation S under the Securities Act
("Regulation S") with respect to the Securities.

               (iii) The Securities (i) are not and have not been listed on a
national securities exchange registered under Section 6 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or quoted on a U.S.
automated interdealer quotation system and (ii) are not of an open-end
investment company, unit investment trust or face-amount certificate company
that are, or are required to be, registered under Section 8 of the Investment
Company Act of 1940, as amended (the "Investment Company Act"), and the
Securities

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otherwise satisfy the eligibility requirements of Rule 144A(d)(3) promulgated
pursuant to the Securities Act ("Rule 144A(d)(3)").

               (iv) Neither the Company nor the Trust is, and, immediately
following consummation of the transactions contemplated hereby and the
application of the net proceeds therefrom, neither the Company nor the Trust
will be, an "investment company" or an entity "controlled" by an "investment
company," in each case within the meaning of Section 3 (a) of the Investment
Company Act.

               (v) Neither the Company nor the Trust has paid or agreed to pay
to any person or entity, directly or indirectly, any fees or other compensation
for soliciting another to purchase any of the Securities, except for the
Commission and/or any fee payable to the Company's introducing agent; provided,
that such introducing agent has an agreement with the Placement Agent.

     4.2 Standing and Qualification of the Trust. The Trust has been duly
created and is validly existing in good standing as a statutory trust under the
Delaware Statutory Trust Act, 12 Del. C. Section 3801, et seq. (the "Statutory
Trust Act") with all requisite power and authority to own property and to
conduct the business it transacts and proposes to transact and to enter into and
perform its obligations under the Operative Documents to which it is a party.
The Trust is duly qualified to transact business as a foreign entity and is in
good standing in each jurisdiction in which such qualification is necessary,
except where the failure to so qualify or be in good standing would not have a
material adverse effect on the condition (financial or otherwise), earnings,
business, prospects or assets of the Trust, whether or not occurring in the
ordinary course of business. The Trust is not a party to, or otherwise bound by,
any agreement other than the Operative Documents. The Trust is, and under
current law will continue to be, classified for federal income tax purposes as a
grantor trust and not as an association or publicly traded partnership taxable
as a corporation.

     4.3 Trust Agreement. The Trust Agreement has been duly authorized by the
Company and, on the Closing Date specified in Section 2.3.1, will have been duly
executed and delivered by the Company and the Administrative Trustees of the
Trust, and, assuming due authorization, execution and delivery by the Property
Trustee and the Delaware Trustee, will be a legal, valid and binding obligation
of the Company and the Administrative Trustees, enforceable against them in
accordance with its terms, subject to applicable bankruptcy, insolvency and
similar laws affecting creditors' rights generally and to general principles of
equity. Each of the Administrative Trustees of the Trust is an employee of the
Company or one of its subsidiary banks and has been duly authorized by the
Company to execute and deliver the Trust Agreement. To the knowledge of the
Administrative Trustees, the Trust is not in violation of any provision of the
Statutory Trust Act.

     4.4 Guarantee Agreement and the Indenture. Each of the Guarantee and the
Indenture has been duly authorized by the Company and, on the Closing Date, will
have been duly executed and delivered by the Company, and, assuming due
authorization, execution and delivery by the Guarantee Trustee, in the case of
the Guarantee, and by the Indenture Trustee, in the case of the Indenture, will
be a legal, valid and binding obligation of the Company enforceable against it
in accordance with its terms, subject to applicable bankruptcy, insolvency

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and similar laws affecting creditors' rights generally and to general principles
of equity.

     4.5 Preferred Securities and Common Securities. The Preferred Securities
and the Common Securities have been duly authorized by the Trust and, when
issued and delivered against payment therefor on the Closing Date to the
Purchaser in accordance with this Agreement and the Subscription Agreement, in
the case of the Preferred Securities, and to the Company in accordance with the
Common Securities Subscription Agreement between the Company and the Trust,
dated as of the Closing Date, in the case of the Common Securities, will be
validly issued, fully paid and nonassessable and will represent undivided
beneficial interests in the assets of the Trust entitled to the benefits of the
Trust Agreement, enforceable against the Trust in accordance with their terms,
subject to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general principles of equity. The issuance of
the Securities is not subject to preemptive or other similar rights. On the
Closing Date, all of the issued and outstanding Common Securities will be
directly owned by the Company free and clear of any pledge, security interest,
claim, lien or other encumbrance (each, a "Lien").

     4.6 Junior Subordinated Notes. The Junior Subordinated Notes have been duly
authorized by the Company and, on the Closing Date, will have been duly executed
and delivered to the Indenture Trustee for authentication in accordance with the
Indenture and, when authenticated in the manner provided for in the Indenture
and delivered to the Trust against payment therefor in accordance with the
Junior Subordinated Note Subscription Agreement between the Company and the
Trust, dated as of the Closing Date, will constitute legal, valid and binding
obligations of the Company entitled to the benefits of the Indenture enforceable
against the Company in accordance with their terms, subject to applicable
bankruptcy, insolvency and similar laws affecting creditors' rights generally
and to general principles of equity.

     4.7 Placement Agreement. This Agreement has been duly authorized, executed
and delivered by the Company and the Trust and constitutes the legal, valid and
binding obligation of the Company and the Trust, enforceable against the Company
and the Trust in accordance with its terms, subject to applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally and to general
principles of equity.

     4.8 Defaults. Neither the issue and sale of the Common Securities, the
Preferred Securities or the Junior Subordinated Notes, nor the purchase of the
Junior Subordinated Notes by the Trust, the execution and delivery of and
compliance with the Operative Documents by the Company or the Trust, the
consummation of the transactions contemplated herein or therein, or the use of
the proceeds therefrom, (i) will conflict with or constitute a breach of, or a
default under, the Trust Agreement or the charter or bylaws of the Company or
any subsidiary of the Company or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, governmental authority,
agency or instrumentality or court, domestic or foreign, having jurisdiction
over the Trust, or the Company or any of its subsidiaries, or their respective
properties or assets (collectively, "Governmental Entities"), (ii) will conflict
with or constitute a violation or breach of, or a default or Repayment Event (as
defined below) under, or result in the creation or imposition of any Lien upon
any property or assets of the Trust, the Company or any of the Company's
subsidiaries pursuant to any contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument to which (A) the Trust, the Company
or any of its subsidiaries is a party or by which it or any of them may be
bound, or (B) any of the property or

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assets of any of them is subject, or any judgment, order or decree of any court,
Governmental Entity or arbitrator, except, in the case of this clause (ii), for
such conflicts, breaches, violations, defaults, Repayment Events (as defined
below) or Liens which (X) would not, singly or in the aggregate, adversely
affect the consummation of the transactions contemplated by the Operative
Documents and (Y) would not, singly or in the aggregate, have a material adverse
effect on the condition (financial or otherwise), earnings, business,
liabilities, prospects and assets (taken as a whole) or business prospects of
the Company and its subsidiaries taken as a whole, whether or not occurring in
the ordinary course of business (a "Material Adverse Effect") or (iii) require
the consent, approval, authorization or order of any court or Governmental
Entity. As used herein, a "Repayment Event" means any event or condition which
gives the holder of any note, debenture or other evidence of indebtedness (or
any person acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the Trust or
the Company or any of its subsidiaries prior to its scheduled maturity.

     4.9 Organization, Standing and Qualification of the Company. The Company
has been duly incorporated and is validly existing as a corporation in good
standing under the laws of Indiana, with all requisite corporate power and
authority to own, lease and operate its properties and conduct the business it
transacts and proposes to transact, and is duly qualified to transact business
and is in good standing as a foreign corporation in each jurisdiction where the
nature of its activities requires such qualification, except where the failure
of the Company to be so qualified would not, singly or in the aggregate, have a
Material Adverse Effect.

     4.10 Subsidiaries of the Company. The Company has no subsidiaries that are
material to its business, financial condition or earnings other than those
subsidiaries listed in Schedule 1 attached hereto (the "Significant
Subsidiaries"). Each Significant Subsidiary has been duly organized and is
validly existing and in good standing under the laws of the jurisdiction in
which it is chartered or organized, with all requisite power and authority to
own its properties and conduct the business it transacts and proposes to
transact. Each Significant Subsidiary is duly qualified to transact business and
is in good standing as a foreign entity in each jurisdiction where the nature of
its activities requires such qualification, except where the failure of any such
Significant Subsidiary to be so qualified would not, singly or in the aggregate,
have a Material Adverse Effect.

     4.11 Government Licenses; Laws. Each of the Trust, the Company and each of
its subsidiaries hold all necessary approvals, authorizations, orders, licenses,
certificates and permits (collectively, "Government Licenses") of and from
Governmental Entities necessary to conduct its respective business as now being
conducted, and neither the Trust, the Company nor any of the Company's
subsidiaries has received any notice of proceedings relating to the revocation
or modification of any such Government License, except where the failure to be
so licensed or approved or the receipt of an unfavorable decision, ruling or
finding, would not, singly or in the aggregate, have a Material Adverse Effect;
all of the Government Licenses are valid and in full force and effect, except
where the invalidity or the failure of such Government Licenses to be in full
force and effect, would not, singly or in the aggregate, have a Material Adverse
Effect; and the Company and its subsidiaries are in compliance with all
applicable laws, rules, regulations, judgments, orders, decrees and consents,
except where the failure to be in compliance would not, singly or in the
aggregate, have a Material Adverse Effect.

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     4.12 Stock. All of the issued and outstanding shares of capital stock of
the Company and each of its subsidiaries are validly issued, fully paid and
nonassessable; except as set forth on Schedule 4.12, all of the issued and
outstanding capital stock of each subsidiary of the Company is owned by the
Company, directly or through subsidiaries, free and clear of any Lien, claim or
equitable right; and none of the issued and outstanding capital stock of the
Company or any subsidiary was issued in violation of any preemptive or similar
rights arising by operation of law, under the charter or by-laws of such entity
or under any agreement to which the Company or any of its subsidiaries is a
party.

     4.13 Property. Each of the Trust, the Company and each subsidiary of the
Company has good and marketable title to all of its respective real and personal
properties, in each case free and clear of all Liens and defects, except for
those that would not, singly or in the aggregate, have a Material Adverse
Effect; and all of the leases and subleases under which the Trust, the Company
or any subsidiary of the Company holds properties are in full force and effect,
except where the failure of such leases and subleases to be in full force and
effect would not, singly or in the aggregate, have a Material Adverse Effect and
none of the Trust, the Company or any subsidiary of the Company has any notice
of any claim of any sort that has been asserted by anyone adverse to the rights
of the Trust, the Company or any subsidiary of the Company under any such leases
or subleases, or affecting or questioning the rights of such entity to the
continued possession of the leased or subleased premises under any such lease or
sublease, except for such claims that would not, singly or in the aggregate,
have a Material Adverse Effect.

     4.14 Conflicts, Authorizations and Approvals. Neither the Company nor any
of its subsidiaries is (i) in violation of its respective charter, bylaws or
similar organizational documents or (ii) in default in the performance or
observance of any obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other agreement or
instrument to which either the Company or any such subsidiary is a party or by
which it or any of them may be bound or to which any of the property or assets
of any of them is subject, except, in the case of clause (ii), where such
default would not, singly or in the aggregate, have a Material Adverse Effect.
No filing with, or authorization, approval, consent, license, order,
registration, qualification or decree of, any Governmental Entity, other than
those that have been made or obtained, is necessary or required for the
performance by the Trust or the Company of their respective obligations under
the Operative Documents, as applicable, or the consummation by the Trust and the
Company of the transactions contemplated by the Operative Documents.

     4.15 Holding Company Registration and Deposit Insurance. The Company is
duly registered as a savings and loan holding company under the Home Owners'
Loan Act of 1933, as amended (the "HOLA"), and the regulations of the Office of
Thrift Supervision (the "OTS"), and the deposit accounts of the Company's
subsidiary depository institutions are insured by the Federal Deposit Insurance
Corporation ("FDIC") to the fullest extent permitted by law and the rules and
regulations of the FDIC, and no proceeding for the termination of such insurance
are pending or, to the knowledge of the Company or the Trust after due inquiry,
threatened.

     4.16 Financial Statements.

                                       11

<PAGE>

          (a) The audited consolidated financial statements (including the notes
thereto) and schedules of the Company and its consolidated subsidiaries at and
for the three fiscal years ended December 31, 2005 (the "Financial Statements")
and the interim unaudited consolidated financial statements of the Company and
its consolidated subsidiaries at and for the quarter ended March 31, 2006 (the
"Interim Financial Statements") provided to the Placement Agent are the most
recently available audited and unaudited consolidated financial statements of
the Company and its consolidated subsidiaries, respectively, and fairly present
in all material respects, in accordance with U.S. generally accepted accounting
principles ("GAAP"), the financial position of the Company and its consolidated
subsidiaries, and the results of operations and changes in financial condition
as of the dates and for the periods therein specified, subject, in the case of
Interim Financial Statements, to year-end adjustments (which are expected to
consist solely of normal recurring adjustments). Such consolidated financial
statements and schedules have been prepared in accordance with GAAP consistently
applied throughout the periods involved (except as otherwise noted therein).

          (b) The Company's report on Form H-(b)11, dated December 31, 2005 (the
"Form H-(b)11"), provided to the Placement Agent is the most recently available
such report, and the information therein fairly presents in all material
respects the financial position of the Company and its subsidiaries. None of the
Company or any of its subsidiaries has been requested by a Governmental Entity
to republish, restate or refile any regulatory or financial report.

          (c) Since the respective dates of the Financial Statements, Interim
Financial Statements and the Form H-(b)11, there has not been (A) any material
adverse change or development with respect to the condition (financial or
otherwise), earnings, business, assets or business prospects of the Company and
its subsidiaries, taken as a whole, whether or not occurring in the ordinary
course of business or (B) any dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital stock other than regular
quarterly dividends on the Company's common stock.

          (d) The accountants of the Company who certified the Financial
Statements are independent public accountants of the Company and its
subsidiaries within the meaning of the Securities Act and the rules and
regulations of the Securities and Exchange Commission ("SEC") thereunder.

     4.17 Regulatory Enforcement Matters. None of the Trust, the Company nor any
of its subsidiaries, nor any of their respective officers, directors, employees
or representatives, is subject or is party to, or has received any notice from
any Regulatory Agency (as defined below) that any of them will become subject or
party to any investigation with respect to, any cease-and-desist order,
agreement, civil monetary penalty, consent agreement, memorandum of
understanding or other regulatory enforcement action, proceeding or order with
or by, or is a party to any commitment letter or similar undertaking to, or is
subject to any directive by, or has been a recipient of any supervisory letter
from, or has adopted any board resolutions at the request or suggestion of, any
Regulatory Agency that, in any such case, currently restricts in any material
respect the conduct of their business or that in any material manner relates to
their capital adequacy, their credit policies, their management or their
business (each, a "Regulatory Action"), nor has the Trust, the Company or any of
its subsidiaries been advised by any

                                       12

<PAGE>

Regulatory Agency that it is considering issuing or requesting any such
Regulatory Action; and, there is no unresolved violation, criticism or exception
by any Regulatory Agency with respect to any report or statement relating to any
examinations of the Trust, the Company or any of its subsidiaries, except where
such unresolved violation, criticism or exception would not, singly or in the
aggregate, have a Material Adverse Effect. If the Company is a bank holding
company that is subject to the Bank Holding Company Act, it is a "well-run" bank
holding company that satisfies the criteria of the Federal Reserve's regulations
at 12 C.F.R. Section 225.14(c). Each of the Company's subsidiaries that is a
depository institution, the accounts of which are insured by the FDIC (i) is
"well-capitalized" within the meaning of 12 U.S.C. Section 1831o and applicable
implementing regulations thereunder; and (ii) is not, and has not been notified
by any Regulatory Agency that it is, in "troubled condition" within the meaning
of 12 U.S.C. Section 1831i and applicable implementing regulations thereunder.
As used herein, the term "Regulatory Agency" means any federal or state agency
charged with the supervision or regulation of depositary institutions or holding
companies of depositary institutions, or engaged in the insurance of depositary
institution deposits, or any court, administrative agency or commission or other
governmental agency, authority or instrumentality having supervisory or
regulatory authority with respect to the Trust, the Company or any of its
subsidiaries.

     4.18 No Undisclosed Liabilities. None of the Trust, the Company nor any of
its subsidiaries has any material liability, whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become due,
including any liability for taxes (and there is no past or present fact,
situation, circumstance, condition or other basis for any present or future
action, suit, proceeding, hearing, charge, complaint, claim or demand against
the Company or its subsidiaries that could give rise to any such liability),
except for (i) liabilities set forth in the Financial Statements or the Interim
Financial Statements and (ii) normal fluctuations in the amount of the
liabilities referred to in clause (i) above occurring in the ordinary course of
business of the Trust, the Company and all of its subsidiaries since the date of
the most recent balance sheet included in such Financial Statements.

     4.19 Litigation. There is no action, suit or proceeding before or by any
Governmental Entity, arbitrator or court, domestic or foreign, now pending or,
to the knowledge of the Company or the Trust after due inquiry, threatened
against or affecting the Trust or the Company or any of the Company's
subsidiaries, except for such actions, suits or proceedings that, if adversely
determined, would not, singly or in the aggregate, adversely affect the
consummation of the transactions contemplated by the Operative Documents or have
a Material Adverse Effect; and the aggregate of all pending legal or
governmental proceedings to which the Trust or the Company or any of its
subsidiaries is a party or of which any of their respective properties or assets
is subject, including ordinary routine litigation incidental to the business,
are not expected to result in a Material Adverse Effect.

     4.20 No Labor Disputes. No labor dispute with the employees of the Trust,
the Company or any of its subsidiaries exists or, to the knowledge of the
executive officers of the Trust or the Company, is imminent, except those which
would not, singly or in the aggregate, have a Material Adverse Effect.

     4.21 Filings with the SEC. The documents of the Company filed with the SEC
in

                                       13

<PAGE>

accordance with the Exchange Act, from and including the commencement of the
fiscal year covered by the Company's most recent Annual Report on Form 10-K or
Form 10-KSB, as applicable, at the time they were or hereafter are filed by the
Company with the SEC (collectively, the "1934 Act Reports"), complied and will
comply in all material respects with the requirements of the Exchange Act and
the rules and regulations of the SEC thereunder (the "1934 Act Regulations"),
and did not, and, at the date of this Agreement and on the Closing Date, do not
and will not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; and other than such instruments, agreements, contracts and other
documents as are filed as exhibits to the Company's Annual Report on Form 10-K
or Form 10-KSB, as applicable, Quarterly Reports on Form 10-Q or Form 10-QSB, as
applicable, or Current Reports on Form 8-K, there are no instruments,
agreements, contracts or documents of a character described in Item 601 of
Regulation S-K promulgated by the SEC to which the Company or any of its
subsidiaries is a party. The Company is in compliance with all currently
applicable requirements of the Exchange Act and the 1934 Act Regulations that
were added by the Sarbanes-Oxley Act of 2002.

     4.22 Deferral of Interest Payments on Junior Subordinated Notes. The
Company has no present intention to exercise its option to defer payments of
interest on the Junior Subordinated Notes as provided in the Indenture. The
Company believes that the likelihood that it would exercise its rights to defer
payments of interest on the Junior Subordinated Notes as provided in the
Indenture at any time during which the Junior Subordinated Notes are outstanding
is remote because of the restrictions that would be imposed on the Company's
ability to declare or pay dividends or distributions on, or to redeem, purchase,
acquire or make a liquidation payment with respect to, any of the Company's
capital stock and on the Company's ability to make any payments of principal,
interest or premium on, or repay, repurchase or redeem, any of its debt
securities that rank pari passu in all respects with or junior in interest to
the Junior Subordinated Notes.

     4.23 Tax Returns. The Company and each of the Significant Subsidiaries have
timely and duly filed all Tax Returns (defined below) required to be filed by
them, and all such Tax Returns are true, correct and complete in all material
respects. The Company and each of the Significant Subsidiaries have timely and
duly paid in full all material Taxes required to be paid by them (whether or not
such amounts are shown as due on any Tax Return). There are no federal, state,
or other Tax audits or deficiency assessments proposed or pending with respect
to the Company or any of the Significant Subsidiaries, and no such audits or
assessments are threatened. As used herein, the terms "Tax" or "Taxes" mean (i)
all federal, state, local, and foreign taxes, and other assessments of a similar
nature (whether imposed directly or through withholding), including any
interest, additions to tax, or penalties applicable thereto, imposed by any
Governmental Entity, and (ii) all liabilities in respect of such amounts arising
as a result of being a member of any affiliated, consolidated, combined, unitary
or similar group, as a successor to another person or by contract. As used
herein, the term "Tax Returns" means all federal, state, local, and foreign Tax
returns, declarations, statements, reports, schedules, forms, and information
returns and any amendments thereto filed or required to be filed with any
Governmental Entity.

     4.24 Taxes. The Trust is not subject to United States federal income tax
with respect to

                                       14

<PAGE>

income received or accrued on the Junior Subordinated Notes, interest payable by
the Company on the Junior Subordinated Notes is deductible by the Company, in
whole or in part, for United States federal income tax purposes, and the Trust
is not, or will not be within ninety (90) days of the date hereof, subject to
more than a de minimis amount of other taxes, duties or other governmental
charges. There are no rulemaking or similar proceedings before the United States
Internal Revenue Service or comparable federal, state, local or foreign
government bodies which involve or affect the Company or any subsidiary, which,
if the subject of an action unfavorable to the Company or any subsidiary, could
result in a Material Adverse Effect.

     4.25 Books and Records. The books, records and accounts of the Company and
its subsidiaries accurately and fairly reflect, in reasonable detail, the
transactions in, and dispositions of, the assets of, and the results of
operations of, the Company and its subsidiaries. The Company and each of its
subsidiaries maintains a system of internal accounting controls sufficient to
provide reasonable assurances that (i) transactions are executed in accordance
with management's general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
accordance with GAAP and to maintain asset accountability, (iii) access to
assets is permitted only in accordance with management's general or specific
authorization and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences

     4.26 Insurance. The Company and the Significant Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts in all material respects as are customary in the businesses
in which they are engaged or propose to engage after giving effect to the
transactions contemplated hereby, including, but not limited to, real or
personal property owned or leased against theft, damage, destruction, act of
vandalism and all other risks customarily insured against. All policies of
insurance and fidelity or surety bonds insuring the Company or any of the
Significant Subsidiaries or the Company's or Significant Subsidiaries'
respective businesses, assets, employees, officers and directors are in full
force and effect. The Company and each of the Significant Subsidiaries are in
compliance with the terms of such policies and instruments in all material
respects. Neither the Company nor any Significant Subsidiary has reason to
believe that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business at a cost that would not have a
Material Adverse Effect. Within the past twelve months, neither the Company nor
any Significant Subsidiary has been denied any insurance coverage which it has
sought or for which it has applied.

     4.27 Corporate Funds. The Company and its subsidiaries or any person acting
on behalf of the Company and its subsidiaries including, without limitation, any
director, officer, agent or employee of the Company or its subsidiaries has not,
directly or indirectly, while acting on behalf of the Company and its
subsidiaries (i) used any corporate funds for unlawful contributions, gifts,
entertainment or other unlawful expenses relating to political activity; (ii)
made any unlawful payment to foreign or domestic government officials or
employees or to foreign or domestic political parties or campaigns from
corporate funds; (iii) violated any provision of the Foreign Corrupt Practices
Act of 1977, as amended; or (iv) made any other unlawful payment.

                                       15

<PAGE>

     4.28 OSHA Compliance. Neither the Company nor any of its subsidiaries is in
violation of any federal or state law or regulation relating to occupational
safety and health and the Company and its subsidiaries have received all
permits, licenses or other approvals required of them under applicable federal
and state occupational safety and health and environmental laws and regulations
to conduct their respective businesses, and the Company and each of its
subsidiaries is in compliance with all terms and conditions of any such permit,
license or approval, except any such violation of law or regulation, failure to
receive required permits, licenses or other approvals or failure to comply with
the terms and conditions of such permits, licenses or approvals which would not,
singly or in the aggregate result in a Material Adverse Effect.

     4.29 Information. The information provided by the Company and the Trust
pursuant to this Agreement does not, as of the date hereof, and will not, as of
the Closing Date, contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading.

Section 5. Representations and Warranties of the Placement Agent. The Placement
Agent represents and warrants to, and agrees with, the Company and the Trust as
follows:

     5.1 General Solicitation. Neither the Placement Agent, nor any of the
Placement Agent's affiliates, nor any person acting on the Placement Agent's or
the Placement Agent's Affiliate's behalf has engaged, or will engage, in any
form of "general solicitation or general advertising" (within the meaning of
Regulation D under the Securities Act) in connection with any offer or sale of
the Preferred Securities.

     5.2 Purchaser. The Placement Agent has made such reasonable inquiry as is
necessary to determine that the Purchaser is acquiring the Preferred Securities
for its own account, the Purchaser does not intend to distribute the Preferred
Securities in contravention of the Securities Act or any other applicable
securities laws.

     5.3 Qualified Purchasers. The Placement Agent has not offered or sold, and
will not arrange for the offer or sale of, the Preferred Securities except (i)
to those the Placement Agent reasonably believes are institutional "accredited
investors" (within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule
501 of Regulation D), (ii) in an offshore transaction complying with Rule 903 of
Regulation S or (iii) in any other manner that does not require registration of
the Preferred Securities under the Securities Act. In connection with each such
sale, the Placement Agent has taken or will take reasonable steps to ensure that
the Purchaser is aware that (a) such sale is being made in reliance on an
exemption under the Securities Act and (b) future transfers of the Preferred
Securities may not be made except in compliance with applicable securities laws.

     5.4 Offering Circulars. Neither the Placement Agent nor its representatives
will include any nonpublic information about the Company, the Trust or any of
their affiliates in any registration statement, prospectus, offering circular or
private placement memorandum used in connection with any purchase of Preferred
Securities without the prior written consent of the Trust and the Company.

                                       16

<PAGE>

Section 6. Covenants of the Offerors. The Offerors covenant and agree with the
Placement Agent and the Purchaser as follows:

     6.1 Compliance with Representations and Warranties. During the period from
the date of this Agreement to the Closing Date, the Offerors shall use their
best efforts and take all action necessary or appropriate to cause their
representations and warranties contained in Section 4 hereof to be true as of
the Closing Date, after giving effect to the transactions contemplated by this
Agreement, as if made on and as of the Closing Date.

     6.2 Sale and Registration of Securities. Neither the Company nor the Trust
will, nor will either of them permit any of its Affiliates to, nor will either
of them permit any person acting on its or their behalf (other than the
Placement Agent and the Purchaser and their respective affiliates) to, directly
or indirectly, (i) resell any Preferred Securities that have been acquired by
any of them, (ii) sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any security (as defined in the Securities Act) that
would or could be integrated with the sale of the Preferred Securities in any
manner that would require the registration of the Securities under the
Securities Act or (iii) make offers or sales of any such Security, or solicit
offers to buy any such Security, under any circumstances that would require the
registration of any of such Securities under the Securities Act.

     6.3 Integration. Neither the Company nor the Trust will, until one hundred
eighty (180) days following the Closing Date, without the Purchaser's prior
written consent, offer, sell, contract to sell, grant any option to purchase or
otherwise dispose of, directly or indirectly, (i) any Preferred Securities or
other securities of the Trust other than as contemplated by this Agreement or
(ii) any other securities convertible into, or exercisable or exchangeable for,
any Preferred Securities or other securities of the Trust.

     6.4 Qualification of Securities. The Company and the Trust will arrange for
the qualification of the Preferred Securities for sale under the laws of such
jurisdictions as the Placement Agent may designate and will maintain such
qualifications in effect so long as required for the sale of the Preferred
Securities. The Company or the Trust, as the case may be, will promptly advise
the Placement Agent of the receipt by the Company or the Trust, as the case may
be, of any notification with respect to the suspension of the qualification of
the Preferred Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose.

     6.5 Use of Proceeds. The Trust shall use the proceeds from the sale of the
Preferred Securities and the Common Securities to purchase the Junior
Subordinated Notes from the Company.

     6.6 Investment Company. So long as any of the Securities are outstanding,
(i) the Securities shall not be listed on a national securities exchange
registered under Section 6 of the Exchange Act or quoted in a U.S. automated
interdealer quotation system, (ii) neither the Company nor the Trust shall be an
open-end investment company, unit investment trust or face- amount certificate
company that is, or is required to be, registered under Section 8 of the
Investment Company Act, and, the Securities shall otherwise satisfy the
eligibility requirements of Rule 144A(d)(3) and (iii) neither of the Offerors
shall engage, or permit any subsidiary to

                                       17

<PAGE>

engage, in any activity which would cause it or any subsidiary to be an
"investment company" under the provisions of the Investment Company Act.

     6.7 Solicitation and Advertising. Neither the Company nor the Trust will,
nor will either of them permit any of their Affiliates or any person acting on
their behalf to (other than the Placement Agent, the Purchaser or their
respective affiliates), (i) engage in any "directed selling efforts" within the
meaning of Regulation S under the Securities Act or (ii) engage in any form of
"general solicitation or general advertising" (within the meaning of Regulation
D) in connection with any offer or sale of any of the Securities.

     6.8 Compliance with Rule 144A(d)(4) under the Securities Act. So long as
any of the Securities are outstanding and are "restricted securities" within the
meaning of Rule 144(a)(3) under the Securities Act, the Offerors will, during
any period in which they are not subject to and in compliance with Section 13 or
15(d) of the Exchange Act, or the Offerors are not exempt from such reporting
requirements pursuant to and in compliance with Rule 12g3-2(b) under the
Exchange Act, provide to each holder of such restricted securities and to each
prospective purchaser (as designated by such holder) of such restricted
securities, upon the request of such holder or prospective purchaser in
connection with any proposed transfer, any information required to be provided
by Rule 144A(d)(4) under the Securities Act, if applicable. The information
provided by the Offerors pursuant to this Section 6.8 will not, at the date
thereof, contain any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. If the Company and the
Trust are required to register under the Exchange Act, such reports filed in
compliance with Rule 12g3-2(b) shall be sufficient information as required
above. This covenant is intended to be for the benefit of the Purchaser, the
holders of the Securities, and the prospective purchasers designated by such
holders, from time to time, of the Securities.

     6.9 Reports. Each of the Company and the Trust shall furnish to (i) the
Placement Agent, (ii) the Purchaser and any subsequent holder of the Securities,
and (iii) any beneficial owner of the Securities reasonably identified to the
Company and the Trust (which identification may be made by either such
beneficial owner or by the Purchaser), a duly completed and executed certificate
in the form attached hereto as Annex F, including the financial statements
referenced in such Annex, which certificate and financial statements shall be so
furnished by the Company and the Trust not later than forty-five (45) days after
the end of each of the first three fiscal quarters of each fiscal year of the
Company and not later than ninety (90) days after the end of each fiscal year of
the Company.

Section 7. Covenants of the Placement Agent. The Placement Agent covenants and
agrees with the Offerors that, during the period from the date of this Agreement
to the Closing Date, the Placement Agent shall use its best efforts and take all
action necessary or appropriate to cause its representations and warranties
contained in Section 5 to be true as of the Closing Date, after giving effect to
the transactions contemplated by this Agreement, as if made on and as of the
Closing Date. The Placement Agent further covenants and agrees not to engage in
hedging transactions with respect to the Preferred Securities unless such
transactions are conducted in compliance with the Securities Act.

                                       18

<PAGE>

Section 8. Indemnification & Contribution.

     8.1 Indemnification.

     8.1.1 The Company and the Trust agree jointly and severally to indemnify
and hold harmless the Placement Agent, the Purchaser, the Placement Agent's
affiliates, a Subsequent Purchaser (collectively, the "Indemnified Parties") and
the Indemnified Parties' respective directors, officers, employees and agents
and each person who "controls" the Indemnified Parties within the meaning of
either the Securities Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the Securities Act, the Exchange Act or other federal
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon (i) any untrue statement or alleged untrue
statement of a material fact contained in any information or documents furnished
or made available to the Purchaser or the Placement Agent by or on behalf of the
Company, (ii) the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading or (iii) the breach or alleged breach of any representation, warranty
or agreement of either Offeror contained herein, and agrees to reimburse each
such Indemnified Party, as incurred, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action. This indemnity agreement will be in addition
to any liability which the Company or the Trust may otherwise have.

     8.1.2 Promptly after receipt by an Indemnified Party under this Section 8
of notice of the commencement of any action, such Indemnified Party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, promptly notify the indemnifying party in writing of the commencement
thereof; but the failure so to notify the indemnifying party (i) will not
relieve the indemnifying party from liability under Section 8.1.1 above unless
and to the extent that such failure results in the forfeiture by the
indemnifying party of material rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any Indemnified
Party other than the indemnification obligation provided in Section 8.1.1 above.
The Placement Agent shall be entitled to appoint counsel to represent the
Indemnified Party in any action for which indemnification is sought. An
indemnifying party may participate at its own expense in the defense of any such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the Indemnified Party) also be counsel to the
Indemnified Party. In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local counsel)
separate from their own counsel for all Indemnified Parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. An
indemnifying party will not, without the prior written consent of the
Indemnified Parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification may be sought hereunder (whether
or not the Indemnified Parties are actual or potential parties to such claim,
action, suit or proceeding) unless such settlement, compromise or consent
includes an unconditional release of each Indemnified Party from all liability
arising out of such claim, action, suit or proceeding.

                                       19

<PAGE>

     8.2 Contribution.

     8.2.1 In order to provide for just and equitable contribution in
circumstances under which the indemnification provided for in Section 8.1 hereof
is for any reason held to be unenforceable for the benefit of an Indemnified
Party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such Indemnified Party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Offerors, on the
one hand, and the Placement Agent, on the other hand, from the offering of the
Securities or (ii) if the allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above, but also the relative fault
of the Offerors, on the one hand, and the Placement Agent, on the other hand, in
connection with the statements, omissions or breaches, which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.

     8.2.2 The relative benefits received by the Offerors, on the one hand, and
the Placement Agent, on the other hand, in connection with the offering of the
Securities shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the Securities (before deducting expenses)
received by the Offerors and the Commission received by the Placement Agent bear
to the aggregate of such net proceeds and Commission.

     8.2.3 The Offerors and the Placement Agent agree that it would not be just
and equitable if contribution pursuant to this Section 8.2 were determined by
pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to above in this Section 8.2.
The aggregate amount of losses, liabilities, claims, damages and expenses
incurred by an Indemnified Party and referred to above in this Section 8.2 shall
be deemed to include any legal or other expenses reasonably incurred by such
Indemnified Party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement, omission or alleged omission or breach or
alleged breach.

     8.2.4 Notwithstanding any provision of this Section 8 to the contrary, the
Placement Agent shall not be required to contribute any amount in excess of the
amount of the Commission.

     8.2.5 No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.

     8.2.6 For purposes of this Section 8.2, the Placement Agent, each person,
if any, who controls the Placement Agent within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act and the respective partners,
directors, officers, employees and agents of the Placement Agent or any such
controlling person shall have the same rights to contribution as the Placement
Agent, while each officer and director of the Company, each trustee of the Trust
and each person, if any, who controls the Company within the meaning of

                                       20

<PAGE>

Section 15 of the Securities Act or Section 20 of the Exchange Act shall have
the same rights to contribution as the Offerors.

     8.3 Additional Remedies. The indemnity and contribution agreements
contained in this Section 8 are in addition to any liability that the Offerors
may otherwise have to any Indemnified Party.

     8.4 Additional Indemnification. The Company shall indemnify and hold
harmless the Trust against all loss, liability, claim, damage and expense
whatsoever, as due from the Trust under Sections 8.1 through 8.3 hereof.

Section 9. Rights and Responsibilities of Placement Agent.

     9.1 Reliance. In performing its duties under this Agreement, the Placement
Agent shall be entitled to rely upon any notice, signature or writing which it
shall in good faith believe to be genuine and to be signed or presented by a
proper party or parties. The Placement Agent may rely upon any opinions or
certificates or other documents delivered by the Offerors or their counsel or
designees to either the Placement Agent or the Purchaser.

     9.2 Rights of Placement Agent. In connection with the performance of its
duties under this Agreement, the Placement Agent shall not be liable for any
error of judgment or any action taken or omitted to be taken unless the
Placement Agent was grossly negligent or engaged in willful misconduct in
connection with such performance or non-performance. No provision of this
Agreement shall require the Placement Agent to expend or risk its own funds or
otherwise incur any financial liability on behalf of the Purchaser in connection
with the performance of any of its duties hereunder. The Placement Agent shall
be under no obligation to exercise any of the rights or powers vested in it by
this Agreement.

Section 10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Placement Agent, by notice given to the Company and
the Trust prior to delivery of and payment for the Preferred Securities, if
prior to such time (i) a downgrading shall have occurred in the rating accorded
the Company's debt securities or preferred stock by any "nationally recognized
statistical rating organization," as that term is used by the SEC in Rule
15c3-1(c)(2)(vi)(F) under the Exchange Act, or such organization shall have
publicly announced that it has under surveillance or review, with possible
negative implications, its rating of the Company's debt securities or preferred
stock, (ii) the Trust shall be unable to sell and deliver to the Purchaser at
least $7,000,000 stated liquidation value of Preferred Securities, (iii) the
Company or any of its subsidiaries that is an insured depository institution
shall cease to be "adequately-capitalized" within the meaning of 12 U.S.C.
Section 1831 and applicable regulations adopted thereunder, or any formal
administrative or judicial action is taken by any appropriate federal banking
agency against the Company or any such insured subsidiary for unsafe and unsound
banking practices, or violations of law, (iv) a suspension or material
limitation in trading in securities generally shall have occurred on the New
York Stock Exchange, (v) a suspension or material limitation in trading in any
of the Company's securities shall have occurred on the exchange or quotation
system upon which the Company's securities are traded, if any, (vi) a general
moratorium on commercial banking activities shall have been declared either by
federal or Indiana authorities or (vii) there shall have occurred any outbreak
or

                                       21

<PAGE>

escalation of hostilities, or declaration by the United States of a national
emergency or war or other calamity or crisis the effect of which on financial
markets is such as to make it, in the Placement Agent's or Purchaser's judgment,
impracticable or inadvisable to proceed with the offering or delivery of the
Preferred Securities.

Section 11. Miscellaneous.

     11.1 Disclosure Schedule. The term "Disclosure Schedule," as used herein,
means the schedule, if any, attached to this Agreement that sets forth items the
disclosure of which is necessary or appropriate as an exception to one or more
representations or warranties contained in Section 4 hereof. The Disclosure
Schedule shall be arranged in paragraphs corresponding to the section numbers
contained in Section 4. Nothing in the Disclosure Schedule shall be deemed
adequate to disclose an exception to a representation or warranty made herein
unless the Disclosure Schedule identifies the exception with reasonable
particularity and describes the relevant facts in reasonable detail. Without
limiting the generality of the immediately preceding sentence, the mere listing
(or inclusion of a copy) of a document or other item in the Disclosure Schedule
shall not be deemed adequate to disclose an exception to a representation or
warranty made herein unless the representation or warranty has to do with the
existence of the document or other item itself. Information provided by the
Company in response to any due diligence questionnaire shall not be deemed part
of the Disclosure Schedule and shall not be deemed to be an exception to one or
more representations or warranties contained in Section 4 hereof unless such
information is specifically included on the Disclosure Schedule in accordance
with the provisions of this Section 11.1.

     11.2 Notices. All communications hereunder will be in writing and effective
only on receipt, and will be mailed, delivered by hand or courier or sent by
facsimile and confirmed:

If to the Placement Agent, to:

               J.P. Morgan Securities Inc.
               270 Park Avenue
               New York, New York 10017
               Facsimile: (212) 834-6027
               Attention: The CDO Group

with a copy to:

               Thacher Proffitt & Wood LLP
               Two World Financial Center
               New York, New York 10281
               Facsimile: (212)912-7751
               Telephone: (212) 912-7400
               Attention: Mark I. Sokolow, Esq.

if to the Offerors, to:

                                       22

<PAGE>

               Blue River Bancshares, Inc.
               29 East Washington Street
               Shelbyville, Indiana 46176
               Facsimile: (317) 392-6208
               Telephone: (317)398-9721
               Attention: Chief Financial Officer

with a copy to:

               Krieg De Vault LLP
               One Indiana Square
               Suite 2800
               Indianapolis, Indiana 46206
               Facsimile: (317)636-1507
               Telephone: (317)238-6249
               Attention: Michael J. Messaglia, Esq.

     All such notices and communications shall be deemed to have been duly given
(i) at the time delivered by hand, if personally delivered, (ii) five business
days after being deposited in the mail, postage prepaid, if mailed, (iii) when
answered back, if telexed, (iv) the next business day after being telecopied, or
(v) the next business day after timely delivery to a courier, if sent by
overnight air courier guaranteeing next-day delivery. From and after the
Closing, the foregoing notice provisions shall be superseded by any notice
provisions of the Operative Documents under which notice is given. The Placement
Agent, the Company, and their respective counsel, may change their respective
notice addresses, from time to time, by written notice to all of the foregoing
persons.

     11.3 Parties in Interest, Successors and Assigns. This Agreement will inure
to the benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person other than the
parties hereto and the affiliates, directors, officers, employees, agents and
controlling persons referred to in Section 8 hereof, their successors, assigns,
heirs and legal representatives, and any Subsequent Purchaser, any right or
obligation hereunder. None of the rights or obligations of the Company or the
Trust under this Agreement may be assigned, whether by operation of law or
otherwise, without the Placement Agent's prior written consent. The rights and
obligations of the Placement Agent and Purchaser under this Agreement may be
assigned by such party without the Company's or the Trust's consent; provided
that the assignee assumes the obligations of such party under this Agreement.

     11.4 Amendments. This Agreement may not be modified, amended, altered or
supplemented, except upon the execution and delivery of a written agreement by
each of the parties hereto.

     11.5 Counterparts and Facsimile. This Agreement may be executed by any one
or more of the parties hereto in any number of counterparts, each of which shall
be deemed to be an original, but all such counterparts shall together constitute
one and the same instrument. This Agreement may be executed by any one or more
of the parties hereto by facsimile which shall be

                                       23

<PAGE>

effective as delivery of a manually executed counterpart hereof.

     11.6 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

     11.7 Governing Law. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT REFERENCE
TO PRINCIPLES OF CONFLICTS OF LAW (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW).

     11.8 Submission to Jurisdiction. ANY LEGAL ACTION OR PROCEEDING BY OR
AGAINST ANY PARTY HERETO OR WITH RESPECT TO OR ARISING OUT OF THIS AGREEMENT 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 (IN EACH CASE SITTING IN THE BOROUGH OF MANHATTAN). BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH PARTY ACCEPTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID
COURTS (AND COURTS OF APPEALS THEREFROM) FOR LEGAL PROCEEDINGS ARISING OUT OF OR
IN CONNECTION WITH THIS AGREEMENT.

     11.9 Entire Agreement. This Agreement, together with the Operative
Documents and the other documents delivered in connection with the transactions
contemplated by this Agreement, is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein and therein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein and
therein. This Agreement, together with the Operative Documents and the other
documents delivered in connection with the transaction contemplated by this
Agreement, supersedes all prior agreements and understandings between the
parties with respect to such subject matter.

     11.10 Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstances, is held
invalid, illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision in every other respect and of
the remaining provisions hereof shall not be in any way impaired or affected, it
being intended that all of the Placement Agent's and the Purchaser's rights and
privileges shall be enforceable to the fullest extent permitted by law.

     11.11 Survival. The respective agreements, representations, warranties,
indemnities and other statements of the Company and the Trust and their
respective officers or trustees and of the Placement Agent set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation made by or on behalf of the Placement Agent, the Purchaser,
the Company or the Trust or any of their respective officers, directors,
trustees or controlling persons, and will survive delivery of and payment for
the Preferred Securities. The provisions of Sections 2.4 and 8 shall survive the
termination or cancellation of this Agreement.

                                       24

<PAGE>

                     Signatures appear on the following page

                                       25

<PAGE>

     If this Agreement is satisfactory to you, please so indicate by signing the
acceptance of this Agreement and deliver such counterpart to the Offerors
whereupon this Agreement will become binding between us in accordance with its
terms.

                                        Very truly yours,

                                        BLUE RIVER BANCSHARES, INC.

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

                                        BLUE RIVER BANCSHARES TRUST I

                                        By: Blue River Bancshares, Inc.,
                                        as Depositor

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

CONFIRMED AND ACCEPTED
as of the date first set forth above

J.P. MORGAN SECURITIES INC.,
as Placement Agent

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

                                       26

<PAGE>

                                                                      Schedule 1

                        List of Significant Subsidiaries

Shelby County Bank
Paramount Bank

                                       27

<PAGE>

                                                                   Schedule 4.12

     The Company has a loan in the amount of $6,000,000 from Union Federal Bank
of Indianapolis ("Union Federal") pursuant to a Credit Agreement, dated November
19, 2003, as amended, between the Company and Union Federal. The loan is secured
by 100% of the current and future shares of stock of Shelby County Bank and
Paramount Bank, wholly owned subsidiaries of the Company.

                                       28

<PAGE>

                                                                       EXHIBIT A

                         FORM OF SUBSCRIPTION AGREEMENT

                   PREFERRED SECURITIES SUBSCRIPTION AGREEMENT

                                 April 20, 2006

     THIS PREFERRED SECURITIES SUBSCRIPTION AGREEMENT (this "Agreement") made
among Blue River Bancshares Trust I (the "Trust"), a statutory trust created
under the Delaware Statutory Trust Act (12 Del. C. Section 3801, et seq.), Blue
River Bancshares, Inc., an Indiana corporation, with its principal offices
located at 29 East Washington Street, Shelbyville, Indiana 46176 (the "Company"
and, together with the Trust, the "Offerors"), TWE, Ltd., an exempted company
incorporated under the laws of the Cayman Islands (the "Purchaser"), and J.P.
Morgan Securities Inc. (as to Sections 1.2, 1.3 and Article III).

                                    RECITALS:

     A. The Trust desires to issue SEVEN MILLION AND 00/100 ($7,000,000) DOLLARS
of its Floating Rate Preferred Securities (the "Preferred Securities"),
liquidation amount $1,000 per Preferred Security, representing an undivided
beneficial interest in the assets of the Trust (the "Offering"), to be issued
pursuant to an Amended and Restated Trust Agreement (the "Trust Agreement") by
and among the Company, Wilmington Trust Company, as Property Trustee (the
"Property Trustee"), Wilmington Trust Company, as Delaware Trustee, the
administrative trustees named therein and the Holders (as defined therein),
which Preferred Securities are to be guaranteed by the Company with respect to
distributions and payments upon liquidation, redemption and otherwise pursuant
to the terms of a Guarantee Agreement between the Company and Wilmington Trust
Company, as Guarantee Trustee (the "Guarantee"); and

     B. The proceeds from the sale of the Preferred Securities will be combined
with the proceeds from the sale by the Trust to the Company of its Common
Securities, and will be used by the Trust to purchase an equivalent amount of
Floating Rate Junior Subordinated Notes of the Company (the "Notes") to be
issued by the Company pursuant to an indenture (the "Indenture") to be executed
by the Company and Wilmington Trust Company, as Indenture Trustee; and

     C. In consideration of the premises and the mutual representations and
covenants hereinafter set forth, the parties hereto agree as follows:

                                    Article I
                    PURCHASE AND SALE OF PREFERRED SECURITIES

     1.1 Upon the execution of this Agreement, the Purchaser hereby agrees to
purchase, directly or indirectly, from the Trust, Preferred Securities at a
price equal to $1,000 per Preferred Security for an aggregate purchase price
equal to SEVEN MILLION AND 00/100 ($7,000,000) DOLLARS (the "Purchase Price"),
and the Trust agrees to sell such Preferred Securities to the Purchaser for said
Purchase Price. The rights and preferences of the Preferred Securities are set
forth in the Trust Agreement. The closing of the sale and purchase of the
Preferred Securities by

                                       A-1

<PAGE>

the Offerors to the Purchaser shall occur on April 20, 2006, or such other later
date (not later than May 19, 2006) as the parties may designate (the "Closing
Date"). The Purchase Price is payable in immediately available funds on the
Closing Date. The Offerors shall provide the Purchaser payment instructions no
later than two (2) days prior to the Closing Date.

     1.2 The Placement Agreement, dated as of April 20, 2006 (the "Placement
Agreement"), among the Offerors and the Placement Agent identified therein (the
"Placement Agent") includes certain representations and warranties, covenants
and conditions to closing and certain other matters governing the Offering. The
Placement Agreement is hereby incorporated by reference into this Agreement, and
the Purchaser shall be entitled to each of the benefits of the Placement Agent
and the Purchaser under the Placement Agreement, subject to the limitations,
qualifications, acknowledgements and exceptions contained therein (except for
the rights of the Placement Agent under Sections 2.1 and 2.4 of the Placement
Agreement) and shall be entitled to enforce the obligations of the Offerors
under such Placement Agreement as fully as if the Purchaser were a party to such
Placement Agreement.

     1.3 The Purchaser is purchasing the Preferred Securities in its capacity as
a warehouse lender, and Purchaser may resell the Preferred Securities to a
subsequent purchaser (any such purchaser from the Purchaser and, if such
purchaser is a warehouse lender, the next subsequent purchaser that is not a
warehouse lender, being referred to hereinafter as a "Subsequent Purchaser").
Upon transfer of the Preferred Securities to a Subsequent Purchaser, the
Subsequent Purchaser shall be entitled to each of the benefits of the Placement
Agent and the Purchaser under the Placement Agreement, subject to the
limitations, qualifications, acknowledgments and exceptions contained therein
and herein (except for the rights of the Placement Agent under Sections 2.1 and
2.4 of the Placement Agreement) and this Agreement, and shall be entitled to
enforce the obligations of the Offerors under the Placement Agreement and this
Agreement, as fully as if the Subsequent Purchaser were a party to the Placement
Agreement and this Agreement.

                                   Article II
                   REPRESENTATIONS AND WARRANTIES OF PURCHASER

     2.1 The Purchaser understands and acknowledges that the Preferred
Securities, the Notes and the Guarantee (i) have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), or any other
applicable securities law, (ii) are being offered for sale by the Trust in
transactions not requiring registration under the Securities Act and (iii) may
not be offered, sold, pledged or otherwise transferred by the Purchaser except
in compliance with the registration requirements of the Securities Act or any
other applicable securities laws, pursuant to an exemption therefrom or in a
transaction not subject thereto.

     2.2 The Purchaser represents and warrants that it is purchasing the
Preferred Securities for its own account and not with a view to, or for offer or
sale in connection with, any distribution thereof in violation of the Securities
Act or other applicable securities laws, subject to any requirement of law that
the disposition of its property be at all times within its control and

                                       A-2

<PAGE>

subject to its ability to resell such Preferred Securities pursuant to an
effective registration statement under the Securities Act or under Rule 144A or
any other exemption from registration available under the Securities Act or any
other applicable securities law. The Purchaser understands that no public market
exists for any of the Preferred Securities, and that it is unlikely that a
public market will ever exist for the Preferred Securities.

     2.3 The Purchaser represents and warrants that (a) it has consulted with
its own legal, regulatory, tax, business, investment, financial and accounting
advisers in connection herewith to the extent it has deemed necessary; (b) it
has had a reasonable opportunity to ask questions of and receive answers from
officers and representatives of the Offerors concerning their respective
financial condition and results of operations and the purchase of the Preferred
Securities and any such questions have been answered to its satisfaction; (c) it
has had the opportunity to review all publicly available records and filings
concerning the Offerors and it has carefully reviewed such records and filings
that it considers relevant to making an investment decision; and (d) it has made
its own investment decisions based upon its own judgment, due diligence and
advice from such advisers as it has deemed necessary and not upon any view
expressed by the Offerors or the Placement Agent.

     2.4 The Purchaser represents and warrants that it is an institutional
"accredited investor" within the meaning of subparagraph (a)(1), (2), (3) or (7)
of Rule 501 of Regulation D under the Securities Act.

                                   Article III
                                  MISCELLANEOUS

     3.1 Any notice or other communication given hereunder shall be deemed
sufficient if in writing and sent by registered or certified mail, return
receipt requested, international courier or delivered by hand against written
receipt therefor, or by facsimile transmission and confirmed by telephone, to
the following addresses, or such other address as may be furnished to the other
parties as herein provided:

          To the Offerors:  Blue River Bancshares, Inc.
                            29 East Washington Street
                            Shelbyville, Indiana 46176
                            Fax: (317)392-6208
                            Attention: Chief Financial Officer

          To the Purchaser: TWE, Ltd.
                            c/o Maples Finance Limited
                            P.O. Box 1093 GT
                            Queensgate House
                            South Church Street
                            George Town
                            Grand Cayman, Cayman Islands
                            Fax: (345) 945-7100

                                       A-3

<PAGE>

                            Attention: The Directors

     Unless otherwise expressly provided herein, notices shall be deemed to have
been given on the date of mailing, except notice of change of address, which
shall be deemed to have been given when received.

     3.2 This Agreement shall not be changed, modified or amended except by a
writing signed by the parties to be charged, and this Agreement may not be
discharged except by performance in accordance with its terms or by a writing
signed by the party to be charged.

     3.3 Upon the execution and delivery of this Agreement by the Purchaser,
this Agreement shall become a binding obligation of the Purchaser with respect
to the purchase of Preferred Securities as herein provided.

     3.4 NOTWITHSTANDING THE PLACE WHERE THIS AGREEMENT MAY BE EXECUTED BY ANY
OF THE PARTIES HERETO, THE PARTIES EXPRESSLY AGREE THAT ALL THE TERMS AND
PROVISIONS HEREOF SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

     3.5 The parties agree to execute and deliver all such further documents,
agreements and instruments and take such other and further action as may be
necessary or appropriate to carry out the purposes and intent of this Agreement.

     3.6 This Agreement may be executed in one or more counterparts each of
which shall be deemed an original, but all of which shall together constitute
one and the same instrument. Delivery of an executed signature page of this
Agreement by facsimile transmission shall be effective as delivery of a manually
executed counterpart hereof.

     3.7 In the event that any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired or affected, it being
intended that all of the Offerors' and the Purchaser's rights and privileges
shall be enforceable to the fullest extent permitted by law.

     3.8 No recourse shall be had to any subscriber, officer, director,
employee, trustee, equity holder, certificate holder, incorporator or agent of
the Purchaser or their respective successors or assigns for any obligations
hereunder. The Offerors, severally and jointly, further agree (i) not to take
any action in respect of any claims hereunder against any subscriber, officer,
director, employee, trustee, equity holder, certificate holder, incorporator or
agent of the Purchaser or any of their successors or assigns that is an
investment vehicle issuing collateralized debt obligations and (ii) not to
institute against any successor or assign of the Purchaser that is an investment
vehicle issuing collateralized debt obligations any insolvency, bankruptcy,

                                       A-4

<PAGE>

reorganization, liquidation or similar proceedings in any jurisdiction until one
year and one day or, if longer, the applicable preference period then in effect,
as the case may be, shall have elapsed since the final payments to the holders
of the securities issued by such investment vehicle.

                     Signatures appear on the following page

                                       A-5

<PAGE>

          IN WITNESS WHEREOF, this Agreement is agreed to and accepted as of the
day and year first written above.

TWE, LTD., as Purchaser,
By: Trapeza Capital Management, LLC,
    as Portfolio Manager

By:
    ---------------------------------
Name:
      -------------------------------
Title: Managing Director

                                        BLUE RIVER BANCSHARES, INC.

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

                                        BLUE RIVER BANCSHARES TRUST I

                                        By: Blue River Bancshares, Inc.,
                                            as Depositor

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

                                        J.P. MORGAN SECURITIES INC.
                                        (for purposes of the rights and
                                        obligations in Sections 1.2, 1.3 and
                                        Article III only)

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

                                       A-6

<PAGE>

                                                                     EXHIBIT B-1

                   FORM OF THACHER PROFFITT & WOOD LLP OPINION

     Pursuant to Section 3.2(a) of the Placement Agreement, Thacher Proffitt &
Wood LLP, special counsel for the Placement Agent and Purchaser, shall deliver
an opinion to the effect that:

(i)  the Company and each Significant Subsidiary is validly existing as a
     corporation in good standing under the laws of the jurisdiction in which it
     is chartered or organized;

(ii) the Company has corporate power and authority to (a) execute and deliver,
     and to perform its obligations under, the Operative Documents to which it
     is a party and (b) issue and perform its obligations under the Notes;

(iii) neither the issue and sale of the Common Securities, the Preferred
     Securities or the Junior Subordinated Notes, nor the purchase by the Trust
     of the Junior Subordinated Notes, nor the execution and delivery of and
     compliance with the Operative Documents by the Company or the Trust nor the
     consummation of the transactions contemplated thereby will constitute a
     breach or violation of the Trust Agreement or the charter or by-laws of the
     Company;

(iv) the Amended and Restated Trust Agreement has been duly authorized, executed
     and delivered by the Company and duly executed and delivered by the
     Administrative Trustees;

(v)  each of the Guarantee and the Indenture has been duly authorized, executed
     and delivered by the Company and, assuming it has been duly authorized,
     executed and delivered by the Guarantee Trustee and the Indenture Trustee,
     respectively, constitutes a legal, valid and binding obligation of the
     Company enforceable against the Company in accordance with its terms,
     subject to applicable bankruptcy, insolvency and similar laws affecting
     creditors' rights generally and to general principles of equity;

(vi) the Junior Subordinated Notes have been duly authorized and executed by the
     Company and delivered to the Indenture Trustee for authentication in
     accordance with the Indenture and, when authenticated in accordance with
     the provisions of the Indenture and delivered to the Trust against payment
     therefor, will constitute legal, valid and binding obligations of the
     Company entitled to the benefits of the Indenture and enforceable against
     the Company in accordance with their terms, subject to applicable
     bankruptcy, insolvency and similar laws affecting creditors' rights
     generally and to general principles of equity;

(vii) the Trust is not, and, following the issuance of the Preferred Securities
     and the consummation of the transactions contemplated by the Operative
     Documents and the application of the proceeds therefrom, the Trust will not
     be, an "investment company" or an entity "controlled" by an "investment
     company," in each case within the meaning of Section 3 (a) of the
     Investment Company Act;

(viii) assuming (a) the accuracy of the representations and warranties, and
     compliance with the agreements contained in the Placement Agreement and (b)
     that the Preferred Securities are sold in a manner contemplated by, and in
     accordance with the Placement Agreement,

                                      B-1-1

<PAGE>

     Subscription Agreement and the Amended and Restated Trust Agreement, it is
     not necessary in connection with the offer, sale and delivery of the
     Preferred Securities by the Trust to the Purchaser, to register any of the
     Securities under the Securities Act or to require qualification of the
     Indenture under the Trust Indenture Act of 1939, as amended;

(ix) the Placement Agreement and Subscription Agreement have been duly
     authorized, executed and delivered by the Company and the Trust; and,

(x)  the Indenture constitutes a valid and binding instrument of the Indenture
     Trustee, enforceable against the Indenture Trustee in accordance with its
     terms, except as rights to indemnity and contribution thereunder may be
     limited under applicable law or public policy, and subject to the
     qualifications that (i) enforcement thereof may be limited by bankruptcy,
     insolvency, receivership, reorganization, liquidation, voidable preference,
     moratorium or other laws (including the laws of fraudulent conveyance and
     transfer) or judicial decisions affecting the enforcement of creditors'
     rights generally or the reorganization of financial institutions and (ii)
     the enforceability of the Indenture Trustee's obligations thereunder is
     subject to general principles of equity (regardless of whether such
     enforceability is considered in a proceeding in equity or at law) and to
     the effect of certain laws and judicial decisions upon the availability and
     enforceability of certain remedies, including the remedies of specific
     performance and self-help.

     In rendering such opinions, such counsel may (A) state that its opinion is
limited to the laws of the State of New York, the Delaware General Corporation
Law and the federal laws of the United States; (B) as to matters involving the
application of laws of any jurisdiction other than the State of New York and the
Delaware General Corporation Law or the federal laws of the United States, (i)
rely, to the extent deemed proper and specified in such opinion, upon the
opinion of other counsel of good standing believed to be reliable and who are
satisfactory to the Purchaser or (ii) assume such law is substantially similar
to the law of the State of New York and, (C) as to matters of fact, rely to the
extent deemed proper, on certificates of responsible officers of the Company and
public officials.

                                      B-1-2

<PAGE>

                                                                     EXHIBIT B-2

                         FORM OF COMPANY COUNSEL OPINION
                            OR OFFICERS' CERTIFICATE

     Pursuant to Section 3.2(b) of the Placement Agreement, either (i) counsel
for the Company shall deliver an opinion, or (ii) the [General Counsel/Chief
Legal Officer] of the Company shall deliver an opinion, or, (iii) if the Company
does not have a General Counsel or Chief Legal Officer, the [Chief Executive
Officer/President/Executive Vice President] and [Chief Financial
Officer/Treasurer/Assistant Treasurer] of the Company shall provide an Officers'
Certificate, to the effect that:

(i)  all of the issued and outstanding shares of capital stock of each
     Significant Subsidiary are owned of record by the Company, and the issuance
     of the Preferred Securities and the Common Securities is not subject to any
     contractual preemptive rights known to such [counsel/officer];

(ii) no consent, approval, authorization or order of any court or governmental
     authority is required for the issue and sale of the Common Securities, the
     Preferred Securities or the Junior Subordinated Notes, the purchase by the
     Trust of the Junior Subordinated Notes, the execution and delivery of and
     compliance with the Operative Documents by the Company or the Trust or the
     consummation of the transactions contemplated in the Operative Documents,
     except such approvals (specified in such [opinion/certificate]) as have
     been obtained;

(iii) to the knowledge of such [counsel/officer], there is no action, suit or
     proceeding before or by any government, governmental instrumentality,
     arbitrator or court, domestic or foreign, now pending or threatened against
     or affecting the Trust or the Company or any Significant Subsidiary that
     could adversely affect the consummation of the transactions contemplated by
     the Operative Documents or could have a Material Adverse Effect;

(iv) the Company is duly registered as a savings and loan holding company under
     the HOLA and the regulations thereunder of the Office of Thrift
     Supervision, and the deposit accounts of the Company's banking subsidiary
     are insured by the FDIC to the fullest extent permitted by law and the
     rules and regulations of the FDIC, and no proceeding for the termination of
     such insurance are pending or, to such person's knowledge, threatened;

(v)  The execution, delivery and performance of the Operative Documents, as
     applicable, by the Company and the Trust and the consummation by the
     Company and the Trust of the transactions contemplated by the Operative
     Documents, as applicable, (a) will not result in any violation of the
     charter or bylaws of the Company, the charter or bylaws of any Significant
     Subsidiary, the Amended and Restated Trust Agreement or the Certificate of
     Trust, and (b) will not conflict with, or result in a breach of any of the
     terms or provisions of, or constitute a default (or an event which, with
     notice or lapse of time or both, would constitute a default) under, or
     result in the creation or imposition of any lien, charge and encumbrance
     upon any assets or properties of the Company or any Significant Subsidiary
     under, (A) any agreement, indenture, mortgage or instrument that the
     Company or any

                                      B-2-1

<PAGE>

     Significant Subsidiary of the Company is a party to or by which it may be
     bound or to which any of its assets or properties may be subject, or (B)
     any existing applicable law, rule or administrative regulation [for General
     Counsel only: except that I express no opinion with respect to the
     securities laws of the State of Delaware] of any court or governmental
     agency or authority having jurisdiction over the Company or any Significant
     Subsidiary of the Company or any of their respective assets or properties,
     except in case of (b), where any such violation, conflict, breach, default,
     lien, charge or encumbrance, would not have a material adverse effect on
     the assets, properties, business, results of operations or financial
     condition of the Company and its subsidiaries, taken as whole.

     All terms used but not defined herein shall have the meanings assigned to
them in the Placement Agreement. A Subsequent Purchaser shall be entitled to
rely on this [opinion/certificate].

     [Applies only to in-house counsel opinion] [In rendering such opinions,
such counsel may (A) state that the above is limited to the laws of the States
of [Jurisdiction of bar admission], (B) rely as to matters of fact, to the
extent deemed proper, on certificates of responsible officers of the Company and
public officials.]

                                      B-2-2

<PAGE>

                                                                     EXHIBIT B-3

                           FORM OF TAX COUNSEL OPINION

     Pursuant to Section 3.2(c) of the Placement Agreement, Thacher Proffitt &
Wood LLP, special tax counsel for the Placement Agent and Purchaser, shall
deliver an opinion to the effect that:

(i)  the Trust will be classified for United States federal income tax purposes
     as a grantor trust and not as an association or a publicly traded
     partnership taxable as a corporation; and

(ii) for United States federal income tax purposes, the Junior Subordinated
     Notes will constitute indebtedness of the Company.

     In rendering such opinions, such counsel may (A) state that its opinion is
limited to the laws of the State of New York and the federal laws of the United
States and (B) rely as to matters of fact, to the extent deemed proper, on
certificates of responsible officers of the Company and public officials.

                                      B-3-1

<PAGE>

                                                                     EXHIBIT B-4

                     FORM OF DELAWARE COUNSEL TRUST OPINION

     Pursuant to Section 3.2(d) of the Placement Agreement, Morris, James,
Hitchens & Williams LLP, special Delaware counsel for the Trust, shall deliver
an opinion to the effect that:

(i)  The Trust has been duly created and is validly existing in good standing as
     a statutory trust under the Delaware Statutory Trust Act, and all filings
     required under the laws of the State of Delaware with respect to the
     creation and valid existence of the Trust as a statutory trust have been
     made.

(ii) Under the Delaware Statutory Trust Act and the Amended and Restated Trust
     Agreement, the Trust has the trust power and authority (i) to own property
     and conduct its business, all as described in the Amended and Restated
     Trust Agreement, (ii) to execute and deliver, and to perform its
     obligations under, each of the Placement Agreement, the Subscription
     Agreement, the Common Securities Subscription Agreement, the Junior
     Subordinated Note Subscription Agreement and the Preferred Securities and
     the Common Securities and (iii) to purchase and hold the Junior
     Subordinated Notes.

(iii) Under the Delaware Statutory Trust Act, the certificate attached to the
     Amended and Restated Trust Agreement as Exhibit C is an appropriate form of
     certificate to evidence ownership of the Preferred Securities. The
     Preferred Securities have been duly authorized by the Amended and Restated
     Trust Agreement and, when issued in accordance with the Amended and
     Restated Trust Agreement and delivered against payment therefor in
     accordance with the Amended and Restated Trust Agreement and the
     Subscription Agreement, the Preferred Securities will be validly issued and
     (subject to the qualifications set forth in this paragraph) fully paid and
     nonassessable and will represent undivided beneficial interests in the
     assets of the Trust, and the Preferred Security Holders will be entitled to
     the benefits of the Amended and Restated Trust Agreement. The Preferred
     Security Holders as beneficial owners of the Trust, will be entitled to the
     same limitation of personal liability extended to stockholders of private
     corporations for profit organized under the General Corporation Law of the
     State of Delaware. The Preferred Security Holders may be obligated to make
     payments or provide indemnity or security as set forth in the Amended and
     Restated Trust Agreement.

(iv) The Common Securities have been duly authorized by the Amended and Restated
     Trust Agreement and, when issued in accordance with the Amended and
     Restated Trust Agreement and delivered against payment therefor in
     accordance with the Amended and Restated Trust Agreement and the Common
     Securities Subscription Agreement, will be validly issued and will
     represent undivided beneficial interests in the assets of the Trust, and
     the Common Security Holder will be entitled to the benefits of the Amended
     and Restated Trust Agreement.

                                      B-4-1

<PAGE>

(v)  Under the Delaware Statutory Trust Act and the Amended and Restated Trust
     Agreement, the issuance of the Preferred Securities and the Common
     Securities is not subject to preemptive or other similar rights.

(vi) Under the Delaware Statutory Trust Act and the Amended and Restated Trust
     Agreement, the execution and delivery by the Trust of the Placement
     Agreement, the Subscription Agreement, the Common Securities Subscription
     Agreement and the Junior Subordinated Note Subscription Agreement, and the
     performance by the Trust of its obligations thereunder, have been duly
     authorized by all necessary trust action on the part of the Trust.

(vii) The Amended and Restated Trust Agreement constitutes a legal, valid and
     binding obligation of the Company and the Trustees, enforceable against the
     Company and the Trustees, in accordance with its terms.

(viii) The issuance and sale by the Trust of the Preferred Securities and the
     Common Securities, the purchase by the Trust of the Junior Subordinated
     Notes, the execution, delivery and performance by the Trust of the
     Placement Agreement, the Subscription Agreement, the Common Securities
     Subscription Agreement and the Junior Subordinated Note Subscription
     Agreement, the consummation by the Trust of the transactions contemplated
     by the Placement Agreement, the Subscription Agreement, the Common
     Securities Subscription Agreement and the Junior Subordinated Note
     Subscription Agreement and compliance by the Trust with its obligations
     thereunder are not prohibited by (i) the Certificate of Trust or the
     Amended and Restated Trust Agreement or (ii) any law or regulation of the
     State of Delaware applicable to the Trust.

(ix) No filing with, or authorization, approval, consent, license, order,
     registration, qualification or decree of, any Delaware court or Delaware
     governmental authority or Delaware agency is required solely in connection
     with the issuance and sale by the Trust of the Trust Securities, the
     purchase by the Trust of the Junior Subordinated Notes, the execution,
     delivery and performance by the Trust of the Placement Agreement, the
     Subscription Agreement, the Common Securities Subscription Agreement and
     the Junior Subordinated Note Subscription Agreement, the consummation by
     the Trust of the transactions contemplated by the Placement Agreement and
     the Subscription Agreement and compliance by the Trust with its obligations
     thereunder.

(x)  The Preferred Security Holders (other than those Preferred Security Holders
     who reside or are domiciled in the State of Delaware) will have no
     liability for income taxes imposed by the State of Delaware solely as a
     result of their participation in the Trust and the Trust will not be liable
     for any income tax imposed by the State of Delaware.

In rendering such opinions, such counsel may (A) state that its opinion is
limited to the laws of the State of Delaware and (B) rely as to matters of fact,
to the extent deemed proper, on certificates of responsible officers of the
Company and the Trust and public officials.

                                      B-4-2

<PAGE>

                                                                     EXHIBIT B-5

                         FORM OF TRUSTEE COUNSEL OPINION

     Pursuant to Section 3.2(e) of the Placement Agreement, Morris, James,
Hitchens & Williams LLP, special counsel for the Property Trustee, the Guarantee
Trustee, the Delaware Trustee and the Indenture Trustee, shall deliver an
opinion to the effect that:

(i)  Wilmington Trust Company is duly incorporated and validly existing as a
     Delaware banking corporation in good standing under the laws of the State
     of Delaware with trust powers and its principal place of business in the
     State of Delaware.

(ii) Wilmington Trust Company has requisite corporate power and authority to
     execute and deliver, and to perform its obligations under, the Amended and
     Restated Trust Agreement, the Guarantee Agreement and the Indenture.

(iii) The execution, delivery, and performance by Wilmington Trust Company of
     the Amended and Restated Trust Agreement, the Guarantee Agreement and the
     Indenture have been duly authorized by all necessary corporate action on
     the part of Wilmington Trust Company, and the Amended and Restated Trust
     Agreement, the Guarantee Agreement and the Indenture have been duly
     executed and delivered by Wilmington Trust Company.

(iv) The Amended and Restated Trust Agreement is a legal, valid and binding
     obligation of Wilmington Trust Company, enforceable against Wilmington
     Trust Company, in accordance with its terms.

(v)  No approval, authorization or other action by, or filing with, any
     governmental authority or agency under any law or regulation of the State
     of Delaware or the United States of America governing the trust powers of
     Wilmington Trust Company is required solely in connection with the
     execution, delivery and performance by Wilmington Trust Company of the
     Amended and Restated Trust Agreement, the Guarantee Agreement and the
     Indenture, except for the filing of the Certificate of Trust with the
     Secretary of State, which Certificate of Trust has been duly filed with the
     Secretary of State.

(vi) The execution, delivery and performance of the Amended and Restated Trust
     Agreement, the Guarantee Agreement and the Indenture by Wilmington Trust
     Company are not prohibited by (i) the Charter or Bylaws of Wilmington Trust
     Company, (ii) any law or regulation of the State of Delaware or the United
     States of America governing the trust powers of Wilmington Trust Company,
     or (iii) to our knowledge (based and relying solely on the Officer
     Certificates), any agreements or instruments to which Wilmington Trust
     Company is a party or by which Wilmington Trust Company is bound or any
     judgment or order applicable to Wilmington Trust Company.

                                      B-5-1

<PAGE>

(vii) The Junior Subordinated Notes delivered on the date hereof have been
     authenticated by due execution thereof and delivered by Wilmington Trust
     Company, as Indenture Trustee, in accordance with the Company Order. The
     Preferred Securities delivered on the date hereof have been authenticated
     by due execution thereof and delivered by Wilmington Trust Company, as
     Property Trustee, in accordance with the Trust Order.

     In rendering such opinions, such counsel may (A) state that its opinion is
limited to the laws of the State of Delaware and the federal laws of the United
States governing the trust powers of Wilmington Trust Company and (B) rely as to
matters of fact, to the extent deemed proper, on certificates of responsible
officers of Wilmington Trust Company and public officials.

                                      B-6-2

<PAGE>

                                                                         Annex F

                              OFFICER'S CERTIFICATE

     The undersigned, the [Chief Financial Officer] [Treasurer] [Executive Vice
President] hereby certifies, pursuant to Section 6.9 of the Placement Agreement,
dated as of April 20, 2006 among Blue River Bancshares, Inc. (the "Company"),
Blue River Bancshares Trust I (the "Trust") and J.P. Morgan Securities Inc.
that, as of_______, 20_____________________, the Company had the following
ratios and balances:

THRIFT HOLDING COMPANY
As of [Quarterly Financial Dates]

<TABLE>
<S>                                                         <C>
Tier 1 Risk Weighted Assets                                  __________%
Ratio of Double Leverage                                     __________%
Non-Performing Assets to Loans and OREO                      __________%
Tangible Common Equity as a Percentage of Tangible Assets    __________%
Ratio of Reserves to Non-Performing Loans                    __________%
Ratio of Net Charge-Offs to Loans                            __________%
Return on Average Assets (annualized)                        __________%
Net Interest Margin (annualized)                             __________%
Efficiency Ratio                                             __________%
Ratio of Loans to Assets                                     __________%
Ratio of Loans to Deposits                                   __________%
Double Leverage (exclude trust preferred as equity)          __________%
Total Assets                                                $__________
Year to Date Income                                         $__________
</TABLE>

*    A table describing the quarterly report calculation procedures is attached.

[FOR FISCAL YEAR END: Attached hereto are the audited consolidated financial
statements (including the balance sheet, income statement and statement of cash
flows, and notes thereto, together with the report of the independent
accountants thereon) of the Company and its consolidated subsidiaries for the
three years ended_______, 20_______________.]

[FOR FISCAL QUARTER END: Attached hereto are the unaudited consolidated and
consolidating financial statements (including the balance sheet and income
statement) of the Company and its consolidated subsidiaries for the fiscal
quarter and [six/nine] month period ended_______, 20__.]

                                       F-1

<PAGE>

                                                                         Annex F

The financial statements fairly present in all material respects, in accordance
with U.S. generally accepted accounting principles ("GAAP"), the financial
position of the Company and its consolidated subsidiaries, and the results of
operations and changes in financial condition as of the date, and for the
[________ quarter interim] [annual] period ended __________, 20__, and such
financial statements have been prepared in accordance with GAAP consistently
applied throughout the period involved (expect as otherwise noted therein).

     IN WITNESS WHEREOF, the undersigned has executed this Officer's Certificate
as of this _____ day of _____________, 20__

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

                                        Blue River Bancshares, Inc.
                                        29 East Washington Street
                                        Shelbyville, Indiana 46176
                                        (317)398-9721

                                       F-2

<PAGE>

                              FINANCIAL DEFINITIONS
                             THRIFT HOLDING COMPANY

<TABLE>
<CAPTION>
       Report Item                          Corresponding TFR                    Description of Calculation
------------------------   --------------------------------------------------   ---------------------------
<S>                        <C>                                                  <C>
Tier I Risk Weighted       Schedule CCR - Consolidated Capital Requirement      Tier 1 Risk Ratio:
Assets -                   CCR 830                                              Core Capital (Tier 1)/
                                                                                Risk-adjusted assets

Ratio of Double Leverage   Not applicable                                       Not applicable

Non-performing assets to   Schedule PD - Consolidated Past Due and Nonaccrual   Total Non-performing assets
loans and OREO             Schedule SC - Consolidated Statement of Condition    (NPLs + Foreclosed Real
                           PD30/(SC26+SC31+SC35+SC40)                           Estate + Other Non-accrual
                                                                                & Repossessed assets)/
                                                                                (Total Loans + Foreclosed
                                                                                Real Estate)

Tangible Common Equity     Schedule CCR                                         (Equity Capital - Goodwill)
as a Percentage of         CCR 840                                              /( Total assets - Goodwill)
Total Assets

Ratio of Reserves to       SC283/PD30                                           Total loan loss reserves /
Non-performing loans                                                            Total Non-performing loans

Ratio of Net               Schedule VA - Consolidated Valuation Allowances      Net charge offs for the
Charge-offs to Loans       and Related Data                                     period as a percentage
                           (VA155-VA135)/(SC26+SC31+SC35)                       of average loans

Return on Assets           Schedule SO - Consolidated Statements of             Net income as a percentage
(annualized)               Operations SO91/SC60                                 of assets

Net interest margin        SO312/((SC11-SC1 10)+SC22+SC26+SC31+SC35)            Net interest income /
(annualized)                                                                    Average earning assets

Efficiency Ratio           (SO51/(SO311+SO40))                                  (Non-interest expense)
                                                                                / (Net interest income
                                                                                + Non-interest income)

Ratio of Loans to          (SC26+SC3 1+SC35)/(SC60)                             Total Loan & Leases
Assets                                                                          / Total assets

Ratio of Loans to          (SC26+SC3 1+SC35)/(SC710)                            Total Loans & Leases
Deposits                                                                        / Total Deposits

Total Assets               Schedule SC                                          The sum of total assets.
                           SC60

Net Income                 Schedule SO                                          The sum of income (loss).
                           SO91
</TABLE>

                                        1exv10w2

 

Exhibit 10.2

FIRST
AMENDMENT TO CREDIT AGREEMENT

          THIS FIRST AMENDMENT (this “Amendment”), dated as of February 22, 2006, amends
the $50,000,000 Credit Agreement dated as of October 28, 2005 (the “Credit Agreement”)
among EXELON CORPORATION, COMMONWEALTH EDISON COMPANY, PECO ENERGY COMPANY, EXELON GENERATION
COMPANY, LLC (each, an “Initial Borrower” and collectively, the “Initial
Borrowers”), various financial institutions and JPMORGAN CHASE BANK, N.A., as administrative
agent (in such capacity, the “Administrative Agent”). Capitalized terms used but not defined
herein have the respective meanings given to them in the Credit Agreement.

          WHEREAS, Exelon Corporation, on behalf of itself and the other Initial Borrowers, has
requested certain amendments to the Credit Agreement, including the deletion of ComEd as a
Borrower thereunder;

          NOW, THEREFORE, in consideration of the premises and for other good and valuable
consideration (the receipt and sufficiency of which are hereby acknowledged), the parties hereto
agree as follows:

          SECTION 1 AMENDMENTS. Upon the effectiveness of this Amendment pursuant to
Section 2 below, the Credit Agreement shall be amended to read in its entirety as set
forth on the attached Annex I.

          SECTION 2 CONDITIONS PRECEDENT. This Amendment shall become effective when the
Administrative Agent has received (a) counterpart signature pages to this Amendment (by facsimile
or otherwise) signed by the Initial Borrowers and the Majority Lenders; and (b) payment in full by
ComEd of all of its obligations under the Credit Agreement, other than contingent indemnification
obligations arising under provisions of the Credit Agreement that by their terms survive
termination thereof (any such obligations, “Surviving
Obligations”).

          SECTION 3 REPRESENTATIONS AND WARRANTIES.

          3.1 Representations and Warranties of ComEd. ComEd represents and warrants to
the Administrative Agent and the Lenders that (a) no Event of Default or Unmatured Event of
Default exists with respect to ComEd, (b) the execution and delivery by ComEd of this
Amendment (i) are within the powers of ComEd, (ii) have been duly authorized by all necessary
action on the part of ComEd, (iii) have received all necessary governmental approval and (iv)
do
not and will not contravene or conflict with any provision of law or of the organizational
documents of ComEd; and (c) this Amendment is the legal, valid and binding obligation of
ComEd, enforceable against ComEd in accordance with its terms, except as enforceability may
be limited by bankruptcy, insolvency or other similar laws of general application affecting
the
enforcement of creditor’s rights or by general principles of equity limiting the availability
of
equitable remedies.

          3.2 Representations and Warranties of Continuing Borrowers. Each of Exelon, PECO
and Genco (each, a “Continuing Borrower” and collectively, the “Continuing
Borrowers”)
represents and warrants to the Administrative Agent and the Lenders that (a) each
representation
and warranty set forth in Article IV of the Credit Agreement is true and correct as if made on
the

 

 

date hereof; (b) the execution and delivery by such Continuing Borrower of this Amendment and the
performance by such Continuing Borrower of its obligations under the Credit Agreement as amended
hereby (as so amended, the “Amended Credit Agreement”) (i) are within the powers of such
Continuing Borrower, (ii) have been duly authorized by all necessary action on the part of such
Continuing Borrower, (iii) have received all necessary governmental approval and (iv) do not and
will not contravene or conflict with any provision of law or of the organizational documents of
such Continuing Borrower; and (c) this Amendment and the Amended Credit Agreement are legal, valid
and binding obligations of such Continuing Borrower, enforceable against such Continuing Borrower
in accordance with their respective terms, except as enforceability may be limited by bankruptcy,
insolvency or other similar laws of general application affecting the enforcement of creditor’s
rights or by general principles of equity limiting the availability of equitable remedies.

          SECTION
4 MISCELLANEOUS.

          4.1 Continuing Effectiveness, etc. Except as expressly set forth herein, the Credit
Agreement shall remain in full force and effect and is ratified, approved and confirmed in all
respects.

          4.2 Severability. Any provision of this Amendment which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and such jurisdiction, be
ineffective
to the extent of such prohibition or unenforceability without invalidating the remaining
provisions of this Amendment or affecting the validity or enforceability of such provision in
any
other jurisdiction.

          4.3 Headings. The various headings of this Amendment are inserted for convenience
only and shall not affect the meaning or interpretation of this Amendment.

          4.4 Execution in Counterparts. This Amendment may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and all of which
shall
constitute together but one and the same agreement.

          4.5 Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH
OF PENNSYLVANIA.

          4.6 Successors and Assigns. This Amendment shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and assigns.

          4.7 Deletion of ComEd as a Borrower. ComEd acknowledges that it shall not be a party
to the Amended Credit Agreement, shall have no right to request or obtain Credit Extensions
thereunder and shall have no other rights or obligations thereunder or in connection therewith
(other than Surviving Obligations).

[Signature Pages Follow]

2

 

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

	 	 	 	 	 	 	 
	 	 	EXELON CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas R. Miller	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Thomas R. Miller	 	 
	 

	 	 	 	Title: Assistant Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	COMMONWEALTH EDISON COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas R. Miller	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Thomas R. Miller	 	 
	 

	 	 	 	Title: Assistant Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	PECO ENERGY COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas R. Miller	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Thomas R. Miller	 	 
	 

	 	 	 	Title: Assistant Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	EXELON GENERATION
COMPANY, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas R. Miller	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Thomas R. Miller	 	 
	 

	 	 	 	Title: Assistant Treasurer	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 
	 

	 	THE LENDERS:

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., as	 	 
	 	 	Administrative Agent and as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Michael J. DeForge	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Michael J. DeForge	 	 
	 	 	Title: Vice President	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	SHOREBANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Riley L. Marshall, JR	 	 
	 

	 	 	 	 	 	 
	 	 	Name: RILEY L. MARSHALL, JR	 	 
	 	 	Title: VICE PRESIDENT	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	UNITED BANK OF PHILADELPHIA	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Evelyn F. Smalls	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Evelyn F. Smalls	 	 
	 	 	Title: President & CEO	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	BANCO POPULAR NORTH
AMERICA. as a	 	 
	 	 	Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Anthony R. Balthazor	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Anthony R. Balthazor	 	 
	 	 	Title: Commercial Banking Officer	 	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	ADAMS NATIONAL BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Susan M. Banks	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Susan M. Banks	 	 
	 	 	Title: Vice President	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	SEAWAY NATIONAL BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Arlene Williams	 	 
	 

	 	 	 	 	 	 
	 	 	Name: ARLENE WILLIAMS	 	 
	 	 	Title: SENIOR VICE PRESIDENT	 	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	HIGHLAND COMMUNITY BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Dennis J. Irvin	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Dennis J. Irvin	 	 
	 	 	Title: President	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	ILLINOIS SERVICE FEDERAL SAVINGS	 	 
	 	 	AND LOAN ASSOCIATION OF CHICAGO	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Norman J. Williams	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Norman J. Williams	 	 
	 	 	Title: Board Chairman and CEO	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	CITIZENS TRUST BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	BANK FINANCIAL	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	LEGACY BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	NORTH MILWAUKEE STATE BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	PACIFIC GLOBAL BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	ASIAN BANK	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

First Amendment to

$50,000,000 Credit Agreement

 

 

ANNEX I

COPY OF CREDIT AGREEMENT AS AMENDED

[ATTACHED]

Annex I-1

 

COMPOSITE COPY

$50,000,000

CREDIT AGREEMENT

dated
as of October 28, 2005

among

EXELON CORPORATION,

PECO ENERGY COMPANY

and

EXELON GENERATION COMPANY, LLC

as Borrowers

VARIOUS FINANCIAL INSTITUTIONS

as Lenders

JPMORGAN CHASE BANK, N.A.

as Administrative Agent

SHOREBANK and UNITED BANK OF PHILADELPHIA

Co-Arrangers

 

 

CONTENTS

			
	 	 	 
	Clause
	 	Page

	 	 	 	 	 
	ARTICLE I      DEFINITIONS AND ACCOUNTING TERMS
	 	 	1	 
	SECTION 1.01      Certain Defined Terms
	 	 	1	 
	SECTION 1.02      Other Interpretive Provisions
	 	 	13	 
	SECTION 1.03      Accounting Principles
	 	 	13	 
	ARTICLE II     AMOUNTS AND TERMS OF THE COMMITMENTS
	 	 	14	 
	SECTION 2.01      Commitments
	 	 	14	 
	SECTION 2.02      Procedures for Advances; Limitations on Borrowings
	 	 	14	 
	SECTION 2.03      Facility Fees
	 	 	15	 
	SECTION 2.04      Reduction of Commitment Amounts
	 	 	15	 
	SECTION 2.05      Repayment of Advances
	 	 	16	 
	SECTION 2.06      Interest on Advances
	 	 	16	 
	SECTION 2.07      Additional Interest on Eurodollar Advances
	 	 	16	 
	SECTION 2.08      Interest Rate Determination
	 	 	17	 
	SECTION 2.09      Continuation and Conversion of Advances
	 	 	17	 
	SECTION 2.10      Prepayments
	 	 	18	 
	SECTION 2.11      Increased Costs
	 	 	18	 
	SECTION 2.12      Illegality
	 	 	19	 
	SECTION 2.13      Payments and Computations
	 	 	20	 
	SECTION 2.14      Taxes
	 	 	21	 
	SECTION 2.15      Sharing of Payments, Etc
	 	 	23	 
	SECTION 2.16      Facility LCs
	 	 	24	 
	SECTION 2.17      Extension of Commitment Termination Date
	 	 	28	 
	ARTICLE III    CONDITIONS TO CREDIT EXTENSIONS
	 	 	28	 
	SECTION 3.01      Conditions Precedent to Initial Credit Extensions
	 	 	28	 
	SECTION 3.02      Conditions Precedent to All Credit Extensions
	 	 	29	 
	SECTION 3.03      Conditions Precedent with respect to ComEd
	 	 	30	 
	ARTICLE IV     REPRESENTATIONS AND WARRANTIES
	 	 	30	 
	SECTION 4.01      Representations and Warranties of the Borrowers
	 	 	30	 
	ARTICLE V      COVENANTS OF THE BORROWERS
	 	 	33	 
	SECTION 5.01      Affirmative Covenants
	 	 	33	 
	SECTION 5.02      Negative Covenants
	 	 	37	 
	ARTICLE VI     EVENTS OF DEFAULT
	 	 	39	 
	SECTION 6.01      Events of Default
	 	 	40	 
	ARTICLE VII    THE ADMINISTRATIVE AGENT
	 	 	42	 
	SECTION 7.01      Authorization and Action
	 	 	42	 

 

 

CONTENTS

			
	 	 	 
	Clause
	 	Page

	 	 	 	 	 
	SECTION 7.02      Agent’s Reliance, Etc
	 	 	42	 
	SECTION 7.03      Agent and Affiliates
	 	 	43	 
	SECTION 7.04      Lender Credit Decision
	 	 	43	 
	SECTION 7.05      Indemnification
	 	 	43	 
	SECTION 7.06      Successor Administrative Agent
	 	 	44	 
	SECTION 7.07      Arrangers
	 	 	44	 
	ARTICLE VIII    MISCELLANEOUS
	 	 	44	 
	SECTION 8.01      Amendments, Etc
	 	 	44	 
	SECTION 8.02      Notices, Etc
	 	 	45	 
	SECTION 8.03      No Waiver; Remedies
	 	 	45	 
	SECTION 8.04      Costs and Expenses; Indemnification
	 	 	45	 
	SECTION 8.05      Right of Set-off
	 	 	46	 
	SECTION 8.06      Binding Effect
	 	 	47	 
	SECTION 8.07      Assignments and Participations
	 	 	47	 
	SECTION 8.08      Governing Law
	 	 	51	 
	SECTION 8.09      Consent to Jurisdiction; Certain Waivers
	 	 	51	 
	SECTION 8.10      Execution in Counterparts; Integration
	 	 	51	 
	SECTION 8.11      Liability Several
	 	 	51	 
	SECTION 8.12      USA PATRIOT ACT NOTIFICATION
	 	 	51	 
	SECTION 8.13      Termination of Existing Agreement
	 	 	52	 

ii

 

	 	 	 
	Schedule I

	 	Pricing Schedule
	Schedule II

	 	Commitments and Pro Rata Shares
	Schedule III

	 	Existing Letters of Credit
	 
	 	 
	Exhibit A

	 	Form of Note
	Exhibit B

	 	Form of Notice of Borrowing
	Exhibit C

	 	Form of Assignment and Acceptance
	Exhibit D

	 	Form of Opinion of Counsel for Exelon and PECO
	Exhibit E

	 	Form of Annual and Quarterly Compliance Certificate
	Exhibit F

	 	Form of Consent to Borrowing

iii

 

CREDIT AGREEMENT

dated as of October 28, 2005

     EXELON CORPORATION, PECO ENERGY COMPANY, EXELON GENERATION COMPANY, LLC, the banks listed on the
signature pages hereof and JPMORGAN CHASE BANK, as Administrative Agent, hereby agree as follows:

ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

     SECTION 1.01 Certain Defined Terms. As used in this Agreement, each of the
following terms shall have the meaning set forth below (each such meaning to be equally applicable
to both the singular and plural forms of the term defined):

     “Adjusted Funds From Operations” means, for any Borrower for any period, such Borrower’s
Net Cash Flows From Operating Activities for such period minus such Borrower’s Transitional
Funding Instrument Revenue for such period plus such Borrower’s Net Interest Expense for
such period minus, in the case of Exelon, the portion (but, not less than zero) of Exelon’s
Net Cash Flows From Operating Activities for such period attributable to ComEd Entities and Energy
Holdings Entities.

     “Administrative Agent” means JPMorgan in its capacity as administrative agent for the
Lenders pursuant to Article VII, and not in its individual capacity as a Lender, and any
successor Administrative Agent appointed pursuant to Section 7.06.

     “Administrative Questionnaire” means an administrative questionnaire, substantially in the
form supplied by the Administrative Agent, completed by a Lender and furnished to the
Administrative Agent in connection with this Agreement.

     “Advance” means an advance by a Lender to a Borrower hereunder. An Advance may be a Base
Rate Advance or a Eurodollar Rate Advance, each of which shall be a “Type” of Advance.

     “Affiliate” means, as to any Person, any other Person that, directly or indirectly,
controls, is controlled by or is under common control with such Person or is a director or officer
of such Person.

     “Applicable Lending Office” means, with respect to each Lender, such Lender’s Domestic
Lending Office in the case of a Base Rate Advance and such Lender’s Eurodollar Lending Office in
the case of a Eurodollar Rate Advance.

     “Applicable Margin” — see Schedule I.

     “Aggregate Commitment Amount” means the total of all Commitment Amounts.

     “Arrangers” means each of ShoreBank and United Bank of Philadelphia.

1

 

     “Assignment and Acceptance” means an assignment and acceptance entered into by a Lender and
an Eligible Assignee, and accepted by the Administrative Agent, in substantially the form of
Exhibit C.

     “Base Rate” means, for any period, a fluctuating interest rate per annum which rate per annum shall
at all times be equal to the Prime Rate.

     “Base Rate Advance” means an Advance that bears interest as provided in Section
2.06(a).

     “Borrowers”
means Exelon, PECO and Genco; and “Borrower” means any one of the foregoing.

     “Borrowing” means a group of Advances to the same Borrower of the same Type made, continued or
converted on the same day by the Lenders ratably according to their Pro Rata Shares and, in the
case of a Borrowing of Eurodollar Rate Advances, having the same Interest Period.

     “Business Day” means a day on which banks are not required or authorized to close in Philadelphia,
Pennsylvania, Chicago, Illinois or New York, New York, and, if the applicable Business Day relates
to any Eurodollar Rate Advances, on which dealings are carried on in the London interbank market.

     “Closing Date” shall mean the date on which all conditions precedent to the initial Credit
Extension have been satisfied.

     “Code” means the Internal Revenue Code of 1986, and the regulations promulgated thereunder, in each
case as amended, reformed or otherwise modified from time to time.

     “ComEd” means Commonwealth Edison Company, an Illinois corporation, or any successor thereof.

     “ComEd Debt” means Debt of any ComEd Entity for which none of the Borrowers nor any of their
Subsidiaries (other than another ComEd Entity) has any liability, contingent or otherwise.

     “ComEd Entity” means ComEd and each of its Subsidiaries.

     “Commitment” means, for any Lender, such Lender’s commitment to make Advances and participate in
Facility LCs for the account of each Borrower hereunder.

     “Commitment Amount” means, for any Lender at any time, the amount set forth opposite such
Lender’s name on Schedule II hereto or, if such Lender has entered into any Assignment and
Acceptance, set forth for such Lender in the Register maintained by the Administrative Agent
pursuant to Section 8.07(c), as such amount may be reduced pursuant to Section
2.04.

     “Commitment Termination Date” means, with respect to any Borrower, the earlier of (i)
October 27, 2006 or such later date to which the scheduled Commitment Termination Date for

2

 

such Borrower may be extended pursuant to Section 2.17 (or, if any such date is not a
Business Day, the next preceding Business Day) or (ii) the date of termination in whole of the
Commitments to such Borrower pursuant to Section 2.04 or 6.01.

     “Commodity Trading Obligations” mean, with respect to any Person, the obligations of such
Person under (i) any commodity swap agreement, commodity future agreement, commodity option
agreement, commodity cap agreement, commodity floor agreement, commodity collar agreement,
commodity hedge agreement, commodity forward contract or derivative transaction and any put, call
or other agreement, arrangement or transaction, including natural gas, power and emissions forward
contracts, or any combination of any such arrangements, agreements and/or transactions, employed in
the ordinary course of such Person’s business, including any such Person’s energy marketing,
trading and asset optimization business, or (ii) any commodity swap agreement, commodity future
agreement, commodity option agreement, commodity hedge agreement, and any put, call or other
agreement or arrangement, or combination thereof (including an agreement or arrangement to hedge
foreign exchange risks) in respect of commodities entered into by such Person pursuant to asset
optimization and risk management policies and procedures adopted in good faith by the Board of
Directors of such Person. The term “commodities” shall include electric energy and/or capacity,
coal, petroleum, natural gas, emissions allowances, weather derivatives and related products and
by-products and ancillary services.

     “Controlled Group” means all members of a controlled group of corporations and all trades
or businesses (whether or not incorporated) under common control that, together with Exelon or any
Subsidiary, are treated as a single employer under Section 414(b) or 414(c) of the Code.

     “Credit Extension” means the making of an Advance or the issuance or modification of a Facility LC
hereunder.

     “Debt” means (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds, debentures,
notes or other similar instruments, (iii) obligations to pay the deferred purchase price of
property or services (other than trade payables incurred in the ordinary course of business), (iv)
obligations as lessee under leases that shall have been or are required to be, in accordance with
GAAP, recorded as capital leases, (v) obligations (contingent or otherwise) under reimbursement or
similar agreements with respect to the issuance of letters of credit (other than obligations in
respect of documentary letters of credit opened to provide for the payment of goods or services
purchased in the ordinary course of business) and (vi) obligations under direct or indirect
guaranties in respect of, and obligations (contingent or otherwise) to purchase or otherwise
acquire, or otherwise to assure a creditor against loss in respect of, indebtedness or obligations
of others of the kinds referred to in clauses (i) through (v) above.

     “Domestic Lending Office” means, with respect to any Lender, the office of such Lender
specified as its “Domestic Lending Office” in its Administrative Questionnaire or in the Assignment
and Acceptance pursuant to which it became a Lender, or such other office of such Lender as such
Lender may from time to time specify to the Borrowers and the Administrative Agent.

3

 

     “Eligible Assignee” means (i) a commercial bank organized under the laws of the United
States, or any State thereof; (ii) a commercial bank organized under the laws of any other country
that is a member of the OECD or has concluded special lending arrangements with the International
Monetary Fund associated with its General Arrangements to Borrow, or a political subdivision of any
such country, provided that such bank is acting through a branch or agency located in the
United States; (iii) a finance company, insurance company or other financial institution or fund
(whether a corporation, partnership or other entity) engaged generally in making, purchasing or
otherwise investing in commercial loans in the ordinary course of its business; (iv) the central
bank of any country that is a member of the OECD; (v) any Lender; or (v) any Affiliate of a Lender;
provided that, unless otherwise agreed by Exelon and the Administrative Agent in their sole
discretion, (A) any Person described in clause (i),
(ii) or (iii) above shall also
(x) have outstanding unsecured long-term debt that is rated BBB- or better by S&P and Baa3 or
better by Moody’s (or an equivalent rating by another nationally recognized credit rating agency of
similar standing if either such corporation is no longer in the business of rating unsecured
indebtedness of entities engaged in such businesses) and (y) have combined capital and surplus (as
established in its most recent report of condition to its primary regulator) of not less than
$100,000,000 (or its equivalent in foreign currency), and (B) any Person described in clause
(ii), (iii), (iv) or (v) above shall, on the date on which it is to become a Lender
hereunder, be entitled to receive payments hereunder without deduction or withholding of any United
States Federal income taxes (as contemplated by Section 2.14(e)).

     “Eligible Successor” means a Person which (i) is a corporation, limited liability company
or business trust duly incorporated or organized, validly existing and in good standing under the
laws of one of the states of the United States or the District of Columbia, (ii) as a result of a
contemplated acquisition, consolidation or merger, will succeed to all or substantially all of the
consolidated business and assets of a Borrower and its Subsidiaries, (iii) upon giving effect to
such contemplated acquisition, consolidation or merger, will have all or substantially all of its
consolidated business and assets conducted and located in the United States and (iv) is acceptable
to the Majority Lenders as a credit matter.

     “Energy Holdings” means PSEG Energy Holdings L.L.C., a New Jersey limited liability
company.

     “Energy Holdings Debt” means Debt of any Energy Holdings Entity for which none of the
Borrowers nor any of their Subsidiaries (other than another Energy Holdings Entity) has any
liability, contingent or otherwise.

     “Energy Holdings Entity” means Energy Holdings and each of its Subsidiaries.

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

     “Eurocurrency Liabilities” has the meaning assigned to that term in Regulation D of the
Board of Governors of the Federal Reserve System, as in effect from time to time.

4

 

     “Eurodollar Lending Office” means, with respect to any Lender, the office of such Lender
specified as its “Eurodollar Lending Office” in its Administrative Questionnaire or in the
Assignment and Acceptance pursuant to which it became a Lender (or, if no such office is specified,
its Domestic Lending Office), or such other office of such Lender as such Lender may from time to
time specify to the Borrowers and the Administrative Agent.

     “Eurodollar Rate” means, for each Interest Period for each Eurodollar Rate Advance made as part of
a Borrowing, the applicable British Bankers’ Association LIBOR rate for deposits in U.S. dollars
having a maturity equal to such Interest Period, as reported by any generally recognized financial
information service as of 11:00 A.M. (London time) two Business Days prior to the first day of such
Interest Period; provided that if no such British Bankers’ Association LIBOR rate is
available to the Administrative Agent, the Eurodollar Rate for such Interest Period shall instead
be the rate determined by the Administrative Agent to be the rate at which JPMorgan or one of its
Affiliate banks offers to place deposits in U.S. dollars with first-class banks in the London
interbank market at approximately 11:00 A.M. (London time) two Business Days prior to the first day
of such Interest Period, in the approximate amount of JPMorgan’s relevant Eurodollar Rate Advance
and having a maturity equal to such Interest Period.

     “Eurodollar Rate Advance” means any Advance that bears interest as provided in Section
2.06(b).

     “Eurodollar Rate Reserve Percentage” of any Lender for any Interest Period means the
reserve percentage applicable during such Interest Period (or if more than one such percentage
shall be so applicable, the daily average of such percentages for those days in such Interest
Period during which any such percentage shall be so applicable) under regulations issued from time
to time by the Board of Governors of the Federal Reserve System (or any successor) for determining
the maximum reserve requirement (including any emergency, supplemental or other marginal reserve
requirement) for such Lender with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities having a term equal to such Interest Period.

     “Event of Default” — see Section 6.01.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended and modified from time to
time.

     “Exelon” means Exelon Corporation, a Pennsylvania corporation, or any Eligible Successor thereof.

     “Existing Agreement” means the $45,500,000 Credit Agreement dated as of October 29, 2004
among the Borrowers, various financial institutions and JPMorgan Chase Bank, N.A., as
Administrative Agent.

     “Existing Letter of Credit” means each letter of credit listed on Schedule III.

     “Facility Fee Rate” — see Schedule I.

5

 

     “Facility LC” means any letter of credit issued pursuant to Section 2.16 and any Existing
Letter of Credit.

     “Facility LC Application” — see Section 2.16.3.

     “Federal Funds Rate” means, for any period, a fluctuating interest rate per annum equal for
each day during such period to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next preceding Business Day)
by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is
a Business Day, the average of the quotations for such day on such transactions received by the
Administrative Agent from three Federal funds brokers of recognized standing selected by it.

     “Final Termination Date” means, with respect to any Borrower, the earlier of (i) the date
on or after the Commitment Termination Date for such Borrower on which all of such Borrower’s
obligations hereunder have been paid in full and all Facility LC’s issued for the account of such
Borrower have expired or been terminated and (ii) the date on which all of such Borrower’s
obligations hereunder have become due and payable (pursuant to Section 6.01 or otherwise).

     “GAAP” — see Section 1.03.

     “Genco” means Exelon Generation Company, LLC, a Pennsylvania limited liability company, or any
Eligible Successor thereof.

     “Granting Bank” — see Section 8.07(h).

     “Hedging Obligations” mean, with respect to any Person, the obligations of such Person
under any interest rate or currency swap agreement, interest rate or currency future agreement,
interest rate collar agreement, interest rate or currency hedge agreement, and any put, call or
other agreement or arrangement designed to protect such Person against fluctuations in interest
rates or currency exchange rates.

     “Interest Coverage Ratio” means, with respect to any Borrower for any period of four
consecutive fiscal quarters, the ratio of such Borrower’s Adjusted Funds From Operations for such
period to such Borrower’s Net Interest Expense for such period.

     “Interest Expense” means, for any Borrower for any period, “interest expense” as shown on a
consolidated statement of income of such Borrower for such period prepared in accordance with GAAP.

     “Interest Expense to Affiliates” means, for any period, in the case of Exelon and PECO,
“Interest Expense to Affiliates” as shown on a consolidated statement of income of Exelon or PECO,
as applicable, for such period.

     “Interest Period” means, for each Eurodollar Rate Advance, the period commencing on the date of
such Eurodollar Rate Advance is made or is converted from a Base Rate Advance and

6

 

ending on the last day of the period selected by the applicable Borrower pursuant to the provisions
below and, thereafter, each subsequent period commencing on the last day of the immediately
preceding Interest Period and ending on the last day of the period selected by such Borrower
pursuant to the provisions below. The duration of each such Interest Period shall be 1, 2, 3 or 6
months, as the applicable Borrower may select in accordance with
Section 2.02 or 2.09;
provided that:

     (i) no Borrower may select any Interest Period that ends after the scheduled Commitment Termination Date for such Borrower;

     (ii) Interest Periods commencing on the same date for Advances made as part of the same Borrowing
shall be of the same duration;

     (iii) whenever the last day of any Interest Period would otherwise occur on a day other than a
Business Day, the last day of such Interest Period shall be extended to occur on the next
succeeding Business Day, unless such extension would cause the last day of such Interest Period to
occur in the next following calendar month, in which case the last day of such Interest Period
shall occur on the next preceding Business Day; and

     (iv) if there is no day in the appropriate calendar month at the end of such Interest Period
numerically corresponding to the first day of such Interest Period, then such Interest Period shall
end on the last Business Day of such appropriate calendar month.

     “JPMorgan” means JPMorgan Chase Bank, N.A. a national banking association, and any successor
thereto.

     “LC Fee Rate” — see Schedule I.

     “LC Issuer” means JPMorgan (or an Affiliate of JPMorgan) in its capacity as issuer of Facility LCs
hereunder.

     “LC Obligations” means, with respect to any Borrower at any time, the sum, without duplication, of
(i) the aggregate undrawn stated amount under all Facility LCs issued for the account of such
Borrower outstanding at such time plus (ii) the aggregate unpaid amount at such time of all
Reimbursement Obligations of such Borrower.

     “LC Payment Date” — see Section 2.16.5.

     “Lenders” means each of the financial institutions listed on the signature pages hereof and each
Eligible Assignee that shall become a party hereto pursuant to Section 8.07.

     “Lien” means any lien (statutory or other), mortgage, pledge, security interest or other charge or
encumbrance, or any other type of preferential arrangement (including the interest of a vendor or
lessor under any conditional sale, capitalized lease or other title retention agreement).

7

 

     “Majority
Lenders” means Lenders having Pro Rata Shares of more than
50% (provided that, for purposes of this definition, no Borrower nor any Affiliate of a Borrower, if a
Lender, shall be included in calculating the amount of any Lender’s Pro Rata Share or the amount of
the Commitment Amounts or Outstanding Credit Extensions, as applicable, required to constitute more
than 50% of the Pro Rata Shares).

     “Material Adverse Change” and “Material Adverse Effect” each means, relative to any
occurrence, fact or circumstances of whatsoever nature (including any determination in any
litigation, arbitration or governmental investigation or proceeding) with respect to any Borrower,
(i) any materially adverse change in, or materially adverse effect on, the financial condition,
operations, assets or business of such Borrower and its consolidated Subsidiaries (other than ComEd
Entities and Energy Holdings Entities), taken as a whole,
provided that, except as
otherwise expressly provided herein, neither (a) changes or effects relating to the
investment of such Borrower or any of its Subsidiaries in ComEd Entities or Energy Holdings
Entities nor (b) the assertion against such Borrower or any of its Subsidiaries of liability for
any obligation arising under ERISA for which such Borrower or any of its Subsidiaries bore joint
and several liability with any ComEd Entity, or the payment by such Borrower or any of its
Subsidiaries of any such obligation, shall be considered in determining whether a Material Adverse
Change or Material Adverse Effect has occurred); or (ii) any materially adverse effect on the
validity or enforceability against such Borrower of this Agreement or any applicable Note.

     “Material Subsidiary” means, with respect to Exelon, each of PECO, Genco and, on and after
the PSEG Merger Date, PSE&G, and any holding company for any of the foregoing.

     “Modify”
and “Modification” — see Section 2.16.1. 

     
“Moody’s” means Moody’s Investors
Service, Inc.

     “Moody’s Rating” means, at any time for any Borrower, the rating issued by Moody’s and then in
effect with respect to such Borrower’s senior unsecured long-term public debt securities without
third-party credit enhancement (it being understood that if such Borrower does not have any
outstanding debt securities of the type described above but has an indicative rating from Moody’s
for debt securities of such type, then such indicative rating shall be used for determining the
“Moody’s Rating”).

     “Multiemployer Plan” means a Plan maintained pursuant to a collective bargaining agreement
or any other arrangement to which Exelon or any other member of the Controlled Group is a party to
which more than one employer is obligated to make contributions.

     “Net Cash Flows From Operating Activities” means, for any Borrower for any period, “Net
Cash Flows provided by Operating Activities” as shown on a consolidated statement of cash flows of
such Borrower for such period prepared in accordance with GAAP, excluding any “working
capital changes” (as shown on such statement of cash flows) taken into account in determining such
Net Cash Flows provided by Operating Activities.

8

 

     “Net Interest Expense” means, for any Borrower for any period, the total of (a) such
Borrower’s Interest Expense for such period minus (b) to the extent that Interest Expense to
Affiliates is included in such Interest Expense and relates to (i) interest payments on debt
obligations that are subordinated to the obligations of such Borrower or its Subsidiaries under
this Agreement, (ii) such Borrower’s Interest Expense to Affiliates for such period or (iii) such
Borrower’s or such Borrower’s Subsidiaries’ Transitional Funding Instrument Interest for such
period minus (c) in the case of Exelon, interest on ComEd Debt and Energy Holdings Debt for such
period.

     “Nonrecourse Indebtedness” means any Debt that finances the acquisition, development,
ownership or operation of an asset in respect of which the Person to which such Debt is owed has no
recourse whatsoever to any Borrower or any of their respective Affiliates other than:

     (i) recourse to the named obligor with respect to such Debt (the “Debtor”) for
amounts limited to the cash flow or net cash flow (other than historic cash flow)
from the asset;

     (ii) recourse to the Debtor for the purpose only of enabling amounts to be
claimed in respect of such Debt in an enforcement of any security interest or lien
given by the Debtor over the asset or the income, cash flow or other proceeds
deriving from the asset (or given by any shareholder or the like in the Debtor over
its shares or like interest in the capital of the Debtor) to secure the Debt, but
only if the extent of the recourse to the Debtor is limited solely to the amount of
any recoveries made on any such enforcement; and

     (iii) recourse to the Debtor generally or indirectly to any Affiliate of the
Debtor, under any form of assurance, undertaking or support, which recourse is
limited to a claim for damages (other than liquidated damages and damages required
to be calculated in a specified way) for a breach of an obligation (other than a
payment obligation or an obligation to comply or to procure compliance by another
with any financial ratios or other tests of financial condition) by the Person
against which such recourse is available.

     “Note” means a promissory note of a Borrower payable to the order of a Lender, in
substantially the form of Exhibit A, evidencing the aggregate indebtedness of such Borrower to such
Lender resulting from the Advances made by such Lender to such Borrower.

     “Notice of Borrowing” — see Section 2.02(a).

     “OECD” means the Organization for Economic Cooperation and Development.

     “Outstanding Credit Extensions” means, with respect to any Borrower, the sum of the aggregate
principal amount of all outstanding Advances to such Borrower plus all LC Obligations of such
Borrower.

     “PBGC” means the Pension Benefit Guaranty Corporation and any entity succeeding to any or all
of its functions under ERISA.

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     “PECO” means PECO Energy Company, a Pennsylvania corporation, or any Eligible Successor
thereof.

     “PECO Mortgage” means the First and Refunding Mortgage, dated as of May 1, 1923, between The
Counties Gas & Electric Company (to which PECO is successor) and Fidelity Trust Company, Trustee
(to which First Union National Bank is successor), as amended, supplemented or refinanced from time
to time, provided that no effect shall be given to any amendment, supplement or refinancing after
the date of this Agreement that would broaden the definition of “excepted encumbrances” as defined
in the PECO Mortgage as constituted on the date of this Agreement.

     “Permitted Obligations” mean, with respect to Genco or any of its Subsidiaries, (1) Hedging
Obligations arising in the ordinary course of business and in accordance with such Person’s
established risk management policies that are designed to protect such Person against, among other
things, fluctuations in interest rates or currency exchange rates and which in the case of
agreements relating to interest rates shall have a notional amount no greater than the payments due
with respect to the Obligations being hedged thereby and (2) Commodity Trading Obligations.

     “Person” means an individual, partnership, corporation (including a business trust), joint
stock company, trust, unincorporated association, joint venture, limited liability company or other
entity, or a government or any political subdivision or agency thereof.

     “Plan” means an employee pension benefit plan that is covered by Title IV of ERISA or subject
to the minimum funding standards under Section 412 of the Code as to which Exelon or any other
member of the Controlled Group may have any liability.

     “Power” means PSEG Power LLC, a Delaware limited liability company.

     “Power Merger” means the proposed merger of Power into Genco subsequent to the PSEG Merger.

     “Power Merger Date” means the date that the Power Merger is consummated.

     “Prime Rate” means a rate per annum equal to the prime rate of interest announced by JPMorgan
(which is not necessarily the lowest rate charged to any customer), changing when and as said prime
rate changes.

     “Principal Subsidiary” means, with respect to a Borrower, (a) each Utility Subsidiary of such
Borrower and (b) each other Subsidiary of such Borrower (i) the consolidated assets of which, as of
the date of any determination thereof, constitute at least 10% of the consolidated assets of such
Borrower or (ii) the consolidated earnings before taxes of which constitute at least 10% of the
consolidated earnings before taxes of such Borrower for the most recently completed fiscal year;
provided that (x) no ComEd Entity shall be considered a Principal Subsidiary of Exelon; and (y) on
or after the PSEG Merger Date, no Energy Holdings Entity shall be considered a Principal Subsidiary
of Exelon.

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     “Pro Rata Share” means, with respect to a Lender, a portion equal to a fraction the numerator
of which is such Lender’s Commitment Amount (plus, after the Commitments have terminated with
respect to any Borrower, the principal amount of such Lender’s outstanding Advances to such
Borrower plus the amount of such Lender’s participation in all of such Borrower’s LC Obligations)
and the denominator of which is the aggregate amount of the Commitment Amounts (plus, after the
Commitments have terminated with respect to any Borrower, the principal amount of all outstanding
Advances to such Borrower plus all LC Obligations of such Borrower).

     “PSE&G” means Public Service Electric and Gas Company, a New Jersey corporation.

     “PSEG” means Public Service Enterprise Group Incorporated, a New Jersey corporation.

     “PSEG Merger” means the merger of PSEG into Exelon substantially as contemplated by the
Agreement and Plan of Merger dated as of December 20, 2004 between PSEG and Exelon.

     “PSEG Merger Date” means the date that the PSEG Merger is consummated.

     “PSE&G Mortgage” means the Mortgage Indenture dated August 1, 1924, between PSE&G and Wachovia
Bank, National Association (formerly Fidelity Union Trust Company), as trustee, as amended,
supplemented or refinanced from time to time, provided that no effect shall be given to any
amendment, supplement or refinancing after the date of this Agreement that would broaden the scope
of Liens permitted under the PSE&G Mortgage as constituted on the date of this Agreement.

     “Register” — see Section 8.07(c).

     “Reimbursement Obligations” means, with respect to any Borrower at any time, the aggregate of
all obligations of such Borrower then outstanding under Section 2.16 to reimburse the LC Issuer for
amounts paid by the LC Issuer in respect of any one or more drawings under Facility LCs.

     “Reportable Event” means a reportable event as defined in Section 4043 of ERISA and
regulations issued under such section with respect to a Plan, excluding, however, such events as to
which the PBGC by regulation waived the requirement of Section 4043(a) of ERISA that it be notified
within 30 days of the occurrence of such event, provided that a failure to meet the minimum funding
standard of Section 412 of the Code and Section 302 of ERISA shall be a Reportable Event regardless
of the issuance of any such waivers in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.

     “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

     “S&P Rating” means, at any time for any Borrower, the rating issued by S&P and then in effect
with respect to such Borrower’s senior unsecured long-term public debt securities without
third-party credit enhancement (it being understood that if such Borrower does not have any
outstanding debt securities of the type described above but has an indicative rating from S&P for

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debt securities of such type, then such indicative rating shall be used for determining the “S&P
Rating”).

     “Single Employer Plan” means a Plan maintained by Exelon or any other member of the Controlled
Group for employees of Exelon or any other member of the Controlled Group.

     “SPC” — see Section 8.07(h).

     “Special Purpose Subsidiary” means a direct or indirect wholly owned corporate Subsidiary of
PECO or, on and after the PSEG Merger Date, PSE&G, substantially all of the assets of which are
“intangible transition property” (as defined in 66 Pa. Cons. Stat. Ann. ss.2812(g), as amended, or
any successor provision of similar import) or “bondable transition property” (as defined in
N.J.S.A. 48:3-51, as amended, or any successor provision of similar import), and proceeds thereof,
formed solely for the purpose of holding such assets and issuing such Transitional Funding
Instruments, and which complies with the requirements customarily imposed on bankruptcy-remote
corporations in receivables securitizations.

     “Subsidiary” means, with respect to any Person, any corporation or unincorporated entity of
which more than 50% of the outstanding capital stock (or comparable interest) having ordinary
voting power (irrespective of whether or not at the time capital stock, or comparable interests, of
any other class or classes of such corporation or entity shall or might have voting power upon the
occurrence of any contingency) is at the time directly or indirectly owned by such Person (whether
directly or through one or more other Subsidiaries).

     “Taxes” — see Section 2.14.

     “Transitional Funding Instrument” means any instruments, pass-through certificates, notes,
debentures, certificates of participation, bonds, certificates of beneficial interest or other
evidences of indebtedness or instruments evidencing a beneficial interest which (i) in the case of
PECO, are “transition bonds” (as defined in 66 Pa. Cons. Stat. Ann. ss.2812(g), as amended),
representing a securitization of “intangible transition property” (as defined in the foregoing
statute), (ii) on and after the PSEG Merger Date, in the case of PSE&G are “transition bonds” (as
defined in N.J.S.A. 48:3-51, as amended), representing a securitization of “bondable transition
property” (as defined in the foregoing statute) and (iii) in the case of each of PECO and, after
the PSEG Merger Date, PSE&G, (A) are issued pursuant to a financing order of a public utilities
commission at the request of an electric utility pursuant to state legislation which is enacted to
facilitate the recovery of certain specified costs by electric utilities through non-bypassable
cent per kilowatt hour charges and/or demand charges authorized pursuant to such order to be
applied and invoiced to customers of such utility and (B) are secured by or otherwise payable
solely from such non-bypassable charges.

     “Transitional Funding Instrument Interest” means, for any Borrower for any period, the portion
of such Borrower’s Interest Expense for such period which was payable in respect of Transitional
Funding Instruments.

     “Transitional Funding Instrument Revenue” means, for any Borrower for any period, the portion
of such Borrower’s (or, in the case of Exelon, its Subsidiaries’) consolidated revenue for

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such period attributable to charges invoiced to customers in respect of Transitional Funding
Instruments.

     “Type” — see the definition of Advance.

     “Unfunded Liabilities” means, (i) in the case of any Single Employer Plan, the amount (if any)
by which the present value of all vested nonforfeitable benefits under such Plan exceeds the fair
market value of all Plan assets allocable to such benefits, all determined as of the then most
recent evaluation date for such Plan, and (ii) in the case of any Multiemployer Plan, the
withdrawal liability that would be incurred by the Controlled Group if all members of the
Controlled Group completely withdrew from such Multiemployer Plan.

     “Unmatured Event of Default” means any event which (if it continues uncured) will, with lapse
of time or notice or both, become an Event of Default.

     “Utility Subsidiary” means, with respect to a Borrower, each Subsidiary of such Borrower that
is engaged principally in the transmission, or distribution of electricity or gas and is subject to
rate regulation as a public utility by federal or state regulatory
authorities; provided that, (i)
no ComEd Entity shall be considered a Utility Subsidiary of Exelon and (ii) on or after the PSEG
Merger Date, no Energy Holdings Entity shall be considered a Utility Subsidiary of Exelon.

     SECTION 1.02 Other Interpretive Provisions. In this Agreement, (a) in the computation of
periods of time from a specified date to a later specified date, the word “from” means “from and
including” and the words “to” and “until” each means “to but excluding”; (b) unless otherwise
indicated, any reference to an Article, Section,
Exhibit or Schedule means an Article or Section
hereof or an Exhibit or Schedule hereto; and (c) the term “including” means “including without
limitation”.

     SECTION 1.03 Accounting Principles. (a) As used in this Agreement, “GAAP” shall mean generally
accepted accounting principles in the United States, applied on a basis consistent with the
principles used in preparing Exelon’s audited consolidated financial statements as of December 31,
2004 and for the fiscal year then ended, as such principles may be revised as a result of changes
in GAAP implemented by a Borrower subsequent to such date. In this Agreement, except to the extent,
if any, otherwise provided herein, all accounting and financial terms shall have the meanings
ascribed to such terms by GAAP, and all computations and determinations as to accounting and
financial matters shall be made in accordance with GAAP. In the event that the financial
statements generally prepared by any Borrower apply accounting principles other than GAAP
(including as a result of any event described in Section 1.03(b)), the compliance certificate
delivered pursuant to Section 5.01(b)(iv) accompanying such financial statements shall include
information in reasonable detail reconciling such financial statements to GAAP to the extent
relevant to the calculations set forth in such compliance certificate.

          (b) If at any time any change in GAAP would affect the computation of any financial ratio or
requirement set forth herein and the applicable Borrower or the Majority Lenders shall so request,
the Administrative Agent, the Lenders and such Borrower shall

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negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof
in light of such change in GAAP (subject to the approval of the
Majority Lenders); provided that,
until so amended, such ratio or requirement shall continue to be computed in accordance with GAAP
prior to such change therein.

ARTICLE II

AMOUNTS AND TERMS OF THE COMMITMENTS

     SECTION 2.01 Commitments. Each Lender severally agrees, on the terms and conditions
hereinafter set forth, (a) to make Advances to any Borrower and (b) to participate in Facility LCs
issued upon the request of any Borrower, in each case from time to time during the period from the
date hereof to the Commitment Termination Date for such Borrower, in an aggregate amount not to
exceed such Lender’s Commitment Amount as in effect from time to time; provided that (i) no Advance
may be made unless all Lenders have consented thereto as more fully provided in Section 3.02; (ii)
no Advance may be made as a Eurodollar Rate Advance unless all Lenders have consented thereto as
more fully provided in Section 3.02; (iii) the aggregate principal amount of all Advances by such
Lender to any Borrower shall not exceed such Lender’s Pro Rata Share of the aggregate principal
amount of all Advances to such Borrower; (iv) such Lender’s participation in Facility LCs issued
for the account of any Borrower shall not exceed such Lender’s Pro Rata Share of all LC Obligations
of such Borrower; and (v) the Outstanding Credit Extensions to all Borrowers shall not at any time
exceed the Aggregate Commitment Amount. Subject to the foregoing, each Borrower may from time to
time borrow, prepay pursuant to Section 2.10 and reborrow hereunder prior to the Commitment
Termination Date for such Borrower.

     SECTION 2.02 Procedures for Advances; Limitations on Borrowings.

          (a) Any Borrower may request Advances hereunder by giving notice (a “Notice of Borrowing”) to
the Administrative Agent (which shall promptly advise each Lender of its receipt thereof) not later
than 10:00 A.M. (Chicago time) on the third Business Day prior to the date of any proposed
borrowing of Eurodollar Rate Advances and on the date of any proposed borrowing of Base Rate
Advances. Each Notice of Borrowing shall be sent by telecopier, confirmed immediately in writing,
and shall be in substantially the form of Exhibit B, specifying therein the Borrower which is
requesting Advances and the requested (i) date of borrowing (which shall be a Business Day), (ii)
Type of Advances to be borrowed, (iii) the aggregate amount of such Advances, and (iv) in the case
of a borrowing of Eurodollar Rate Advances, the initial Interest Period therefor. Each Lender
shall, before 12:00 noon (Chicago time) on the date of such borrowing, make available for the
account of its Applicable Lending Office to the Administrative Agent at its address referred to in
Section 8.02, in same day funds, such Lender’s ratable portion of the requested borrowing. After
the Administrative Agent’s receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article III, the Administrative Agent will make such funds available to the applicable
Borrower at the Administrative Agent’s aforesaid address.

          (b) Each Notice of Borrowing shall be irrevocable and binding on the applicable Borrower. If
a Notice of Borrowing requests Eurodollar Rate Advances, the

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applicable Borrower shall indemnify each Lender against any loss, cost or expense incurred by such
Lender as a result of any failure to fulfill on or before the requested borrowing date the
applicable conditions set forth in Article III, including any loss, cost or expense incurred by
reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to
fund the requested Advance to be made by such Lender.

          (c) Unless the Administrative Agent shall have received notice from a Lender prior to the date
of any requested borrowing (or, in the case of a borrowing of Base Rate Advances to be made on the
same Business Day as the Administrative Agent’s receipt of the relevant Notice of Borrowing, prior
to 10:30 A.M., Chicago time, on such Business Day) that such Lender will not make available to the
Administrative Agent such Lender’s ratable portion of such borrowing, the Administrative Agent may
assume that such Lender has made such portion available to the Administrative Agent on the
requested borrowing date in accordance with Section 2.02(a) and the Administrative Agent may, in
reliance upon such assumption, make available to the applicable Borrower on such date a
corresponding amount. If and to the extent that such Lender shall not have so made such ratable
portion available to the Administrative Agent, such Lender and such Borrower severally agree to
repay to the Administrative Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available to such Borrower until
the date such amount is repaid to the Administrative Agent, at (i) in the case of such Borrower,
the interest rate applicable at the time to Advances made in connection with such borrowing and
(ii) in the case of such Lender, the Federal Funds Rate. If such Lender shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall constitute such
Lender’s Advance as part of such Borrowing for purposes of this Agreement.

          (d) The failure of any Lender to make the Advance to be made by it on any borrowing date shall
not relieve any other Lender of its obligation, if any, hereunder to make its Advance on such date,
but no Lender shall be responsible for the failure of any other Lender to make any Advance to be
made by such other Lender.

          (e) Each Borrowing of Base Rate Advances shall at all times be in an aggregate amount of
$1,000,000 or a higher integral multiple of $1,000,000; and each Borrowing of Eurodollar Rate
Advances shall at all times be in an aggregate amount of $1,000,000 or a higher integral multiple
of $1,000,000. Notwithstanding anything to the contrary contained herein, the Borrowers
collectively may not have more than 25 Borrowings of Eurodollar Rate Advances outstanding at any
time.

     SECTION 2.03 Facility Fees. Exelon agrees to pay to the Administrative Agent, for the account
of the Lenders according to their Pro Rata Shares, a facility fee for the period from the Closing
Date to the Commitment Termination Date (or, if later, the date on which all Outstanding Credit
Extensions have been paid in full) in an amount equal to the Facility Fee Rate multiplied by the
Aggregate Commitment Amount (or, after the Commitment Termination Date, the principal amount of all
Outstanding Credit Extensions), payable on the last day of each March, June, September and December
and on the Final Termination Date (and, if applicable, thereafter on demand).

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     SECTION 2.04 Reduction of Commitment Amounts. (a) Exelon shall have the right, upon at least
two Business Days’ notice to the Administrative Agent, to ratably reduce the respective Commitment
Amounts of the Lenders in accordance with their Pro Rata Shares;
provided that the Aggregate
Commitment Amount may not be reduced to an amount that is less than the Outstanding Credit
Extensions; and provided, further, that each partial reduction of the Commitment Amounts shall be
in the aggregate amount of $5,000,000 or an integral multiple thereof. Once reduced pursuant to
this Section 2.04, the Commitment Amounts may not be increased.

          (b) Any Borrower shall have the right at any time, upon at least two Business Days’ notice to
the Administrative Agent, to terminate the Commitment of each Lender with respect to such Borrower
in its entirety (but only if such Borrower concurrently pays all of its obligations hereunder).
Upon any such termination, such Borrower shall cease to be a party hereto and shall no longer have
any rights or obligations hereunder (except under provisions hereof which by their terms would
survive any termination hereof).

     SECTION 2.05 Repayment of Advances. Each Borrower shall repay the principal amount of all
Advances made to it on or before the Commitment Termination Date for such Borrower.

     SECTION 2.06 Interest on Advances. Each Borrower shall pay interest on the unpaid principal
amount of each Advance made to it from the date of such Advance until such principal amount shall
be paid in full, at the following rates per annum:

          (a) At all times such Advance is a Base Rate Advance, a rate per annum equal to the Base Rate
in effect from time to time, payable quarterly on the last day of each March, June, September and
December and on the date such Base Rate Advance is converted to a Eurodollar Rate Advance or paid
in full.

          (b) Subject to Section 2.07, at all times such Advance is a Eurodollar Rate Advance, a rate
per annum equal to the sum of the Eurodollar Rate for each applicable
Interest Period plus the
Applicable Margin in effect from time to time for such Borrower, payable on the last day of each
Interest Period for such Eurodollar Rate Advance (and, if any Interest Period for such Advance is
six months, on the day that is three months after the first day of such Interest Period) or, if
earlier, on the date such Eurodollar Rate Advance is converted to a Base Rate Advance or paid in
full.

     SECTION 2.07 Additional Interest on Eurodollar Advances. Each Borrower shall pay to each
Lender, so long as such Lender shall be required under regulations of the Board of Governors of the
Federal Reserve System to maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities, additional interest on the unpaid principal amount of each
Eurodollar Rate Advance of such Lender made to such Borrower, from the date of such Advance until
such principal amount is paid in full or converted to a Base Rate Advance, at an interest rate per
annum equal to the remainder obtained by subtracting (i) the Eurodollar Rate for each Interest
Period for such Advance from (ii) the rate obtained by dividing such Eurodollar Rate by a
percentage equal to 100% minus the Eurodollar Rate Reserve Percentage of such Lender for such
Interest Period, payable on each date on which interest is payable on such

16

 

Advance;
provided that no Lender shall be entitled to demand such additional interest more than 90
days following the last day of the Interest Period in respect of which such demand is made;
provided, further, that the foregoing proviso shall in no way limit the right of any Lender to
demand or receive such additional interest to the extent that such additional interest relates to
the retroactive application of the reserve requirements described above if such demand is made
within 90 days after the implementation of such retroactive reserve requirements. Such additional
interest shall be determined by the applicable Lender and notified to the applicable Borrower
through the Administrative Agent, and such determination shall be conclusive and binding for all
purposes, absent manifest error.

     SECTION 2.08 Interest Rate Determination. (a) The Administrative Agent shall give prompt
notice to the applicable Borrower and the Lenders of each applicable interest rate determined by
the Administrative Agent for purposes of Section 2.06(a)
or (b).

          (b) If, with respect to any Eurodollar Rate Advances, the Majority Lenders notify the
Administrative Agent that the Eurodollar Rate for any Interest Period for such Advances will not
adequately reflect the cost to such Majority Lenders of making, funding or maintaining their
respective Eurodollar Rate Advances for such Interest Period, the Administrative Agent shall
forthwith so notify the applicable Borrower and the Lenders, whereupon

     (i) each Eurodollar Rate Advance will automatically, on the last day of the
then existing Interest Period therefor (unless prepaid or converted to a Base Rate
Advance prior to such day), convert into a Base Rate Advance, and

     (ii) the obligation of the Lenders to make, continue or convert into
Eurodollar Rate Advances shall be suspended until the Administrative Agent shall
notify the applicable Borrower and the Lenders that the circumstances causing such
suspension no longer exist.

     SECTION 2.09 Continuation and Conversion of Advances. (a) Any Borrower may on any Business
Day, upon notice given to the Administrative Agent not later than 10:00 A.M. (Chicago time) on the
third Business Day prior to the date of any proposed continuation of or conversion into Eurodollar
Rate Advances, and on the date of any proposed conversion into Base Rate Advances, and subject to
the provisions of Sections 2.08 and 2.12, continue Eurodollar Rate Advances for a new Interest
Period or convert a Borrowing of Advances of one Type into Advances of the other Type; provided
that any continuation of Eurodollar Rate Advances or conversion of Eurodollar Rate Advances into
Base Rate Advances shall be made on, and only on, the last day of an Interest Period for such
Eurodollar Rate Advances, unless, in the case of such a conversion, such Borrower shall also
reimburse the Lenders pursuant to Section 8.04(b) on the date of such conversion; and provided,
further, that Base Rate Advances may not be converted into Eurodollar Rate Advances unless all
Lenders have consented in writing to such conversion. Each such notice of a continuation or
conversion shall, within the restrictions specified above, specify (i) the date of such
continuation or conversion, (ii) the Advances to be continued or converted, and (iii) in the case
of continuation of or conversion into Eurodollar Rate Advances, the duration of the Interest Period
for such Advances.

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          (b) If a Borrower shall fail to select the Type of any Advance or the duration of any Interest
Period for any Borrowing of Eurodollar Rate Advances in accordance with the provisions contained in
the definition of “Interest Period” in Section 1.01 and Section 2.09(a), the Administrative Agent
will forthwith so notify such Borrower and the Lenders and such Advances will automatically, on the
last day of the then existing Interest Period therefor, convert into Base Rate Advances.

     SECTION 2.10 Prepayments. Any Borrower may, upon notice to the Administrative Agent at least
three Business Days prior to any prepayment of Eurodollar Rate Advances, or one Business Day’s
notice prior to any prepayment of Base Rate Advances, in each case stating the proposed date and
aggregate principal amount of the prepayment, and if such notice is given that Borrower shall,
prepay the outstanding principal amounts of the Advances made as part of the same Borrowing in
whole or ratably in part, together with accrued interest to the date of such prepayment on the
principal amount prepaid; provided that (i) each partial prepayment shall be in an aggregate
principal amount not less than $10,000,000 or a higher integral multiple of $1,000,000 in the case
of any prepayment of Eurodollar Rate Advances and $5,000,000 or a higher integral multiple of
$1,000,000 in the case of any prepayment of Base Rate Advances, and (ii) in the case of any such
prepayment of a Eurodollar Rate Advance, such Borrower shall be obligated to reimburse the Lenders
pursuant to Section 8.04(b) on the date of such prepayment. After the Commitment Termination Date,
amounts prepaid under this Section 2.10 may not be reborrowed.

     SECTION 2.11 Increased Costs. (a) If on or after the date of this Agreement, any Lender or the
LC Issuer determines that (i) the introduction of or any change (other than, in the case of
Eurodollar Rate Advances, any change by way of imposition or increase of reserve requirements,
included in the Eurodollar Rate Reserve Percentage) in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) shall increase the cost to such
Lender or the LC Issuer, as the case may be, of agreeing to make or making, funding or maintaining
Eurodollar Rate Advances or of issuing or participating in any Facility LC, then the applicable
Borrower shall from time to time, upon demand by such Lender (with a copy of such demand to the
Administrative Agent) or the LC Issuer, as applicable, pay to the Administrative Agent for the
account of such Lender or the LC Issuer, as the case may be, the additional amounts (without
duplication of any amount payable pursuant to Section 2.14) sufficient to compensate such Lender or
the LC Issuer, as applicable, for such increased cost; provided that no Lender shall be entitled to
demand such compensation more than 90 days following the last day of the Interest Period in respect
of which such demand is made and the LC Issuer shall not be entitled to demand such compensation
more than 90 days following the expiration or termination (by a drawing or otherwise) of the
Facility LC in respect of which such demand is made; provided,
further, that the foregoing proviso
shall in no way limit the right of any Lender or the LC Issuer to demand or receive such
compensation to the extent that such compensation relates to the retroactive application of any
law, regulation, guideline or request described in clause
(i) or (ii) above if such demand is made
within 90 days after the implementation of such retroactive law, interpretation, guideline or
request. A certificate as to the amount of such increased
cost, submitted to the applicable Borrower and the Administrative Agent by a Lender or the LC
Issuer, shall be conclusive and binding for all purposes, absent manifest error.

18

 

          (b) If any Lender or the LC Issuer determines that, after the date of this Agreement,
compliance with any law or regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) regarding capital adequacy
requirements affects or would affect the amount of capital required or expected to be maintained by
such Lender or the LC Issuer or any Person controlling such Lender or the LC Issuer (including, in
any event, any determination after the date of this Agreement by any such governmental authority or
central bank that, for purposes of capital adequacy requirements, any Lender’s Commitment to a
Borrower or the LC Issuer’s commitment to issue Facility LCs for the account of such Borrower as
the case may be does not constitute a commitment with an original maturity of less than one year)
and that the amount of such capital is increased by or based upon the existence of such Lender’s
Commitment to such Borrower or the LC Issuer’s commitment to issue Facility LCs for the account of
such Borrower, as applicable, or the Advances made by such Lender to such Borrower or Reimbursement
Obligations owed to the LC Issuer by such Borrower, as the case may be, then, upon demand by such
Lender (with a copy of such demand to the Administrative Agent) or the LC Issuer, as applicable,
such Borrower shall immediately pay to the Administrative Agent for the account of such Lender or
LC Issuer, as applicable, from time to time as specified by such Lender or the LC Issuer, as
applicable, additional amounts sufficient to compensate such Lender, the LC Issuer or such
controlling Person, as applicable, in the light of such circumstances, to the extent that such
Lender determines such increase in capital to be allocable to the existence of such Lender’s
Commitment to such Borrower or the Advances made by such Lender to such Borrower or the LC Issuer
determines such increase in capital to be allocable to the LC Issuer’s commitment to issue Facility
LCs for the account of such Borrower or the Reimbursement Obligations owed by such Borrower to the
LC Issuer; provided that no Lender or the LC Issuer shall be entitled to demand such compensation
more than one year following the payment to or for the account of such Lender of all other amounts
payable hereunder by such Borrower and under any Note of such Borrower held by such Lender and the
termination of such Lender’s Commitment to such Borrower and the LC Issuer shall not be entitled to
demand such compensation more than one year after the expiration or termination (by drawing or
otherwise) of all Facility LCs issued for the account of such Borrower and the termination of the
LC Issuer’s commitment to issue Facility LCs for the account of
such Borrower; provided, further,
that the foregoing proviso shall in no way limit the right of any Lender or the LC Issuer to demand
or receive such compensation to the extent that such compensation relates to the retroactive
application of any law, regulation, guideline or request described above if such demand is made
within one year after the implementation of such retroactive law, interpretation, guideline or
request. A certificate as to such amounts submitted to the applicable Borrower and the
Administrative Agent by the applicable Lender or the LC Issuer shall be conclusive and binding, for
all purposes, absent manifest error.

          (c) Any
Lender claiming compensation pursuant to this Section 2.11 shall use its best efforts
(consistent with its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its Applicable Lending Office if the making of such a change would avoid the need
for, or reduce the amount of, any such compensation that may thereafter accrue and would not, in
the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender.

     SECTION 2.12 Illegality. Notwithstanding any other provision of this Agreement, if any Lender
shall notify the Administrative Agent that the introduction of or any change in or

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in the interpretation of any law or regulation makes it unlawful, or any central bank or other
governmental authority asserts that it is unlawful, for such Lender or its Eurodollar Lending
Office to perform its obligations hereunder to make Eurodollar Rate Advances or to fund or maintain
Eurodollar Rate Advances hereunder, (i) the obligation of such Lender to make, continue or convert
Advances into Eurodollar Rate Advances shall be suspended (subject to the following paragraph of
this Section 2.12) until the Administrative Agent shall notify the applicable Borrower and the
Lenders that the circumstances causing such suspension no longer exist and (ii) all Eurodollar Rate
Advances of such Lender then outstanding shall, on the last day of the then applicable Interest
Period (or such earlier date as such Lender shall designate upon not less than five Business Days’
prior written notice to the Administrative Agent), be automatically converted into Base Rate
Advances.

     If the obligation of any Lender to make, continue or convert into Eurodollar Rate Advances has
been suspended pursuant to the preceding paragraph, then, unless and until the Administrative Agent
shall notify the applicable Borrower and the Lenders that the circumstances causing such suspension
no longer exist, (i) all Advances that would otherwise be made by such Lender as Eurodollar Rate
Advances shall instead be made as Base Rate Advances and (ii) to the extent that Eurodollar Rate
Advances of such Lender have been converted into Base Rate Advances pursuant to the preceding
paragraph or made instead as Base Rate Advances pursuant to the preceding clause (i), all payments
and prepayments of principal that would have otherwise been applied to such Eurodollar Rate
Advances of such Lender shall be applied instead to such Base Rate Advances of such Lender.

     SECTION 2.13 Payments and Computations. (a) Each Borrower shall make each payment hereunder
and under any Note issued by such Borrower not later than 10:00 A.M. (Chicago time) on the day when
due in U.S. dollars to the Administrative Agent at its address referred to in Section 8.02 in same
day funds without setoff, counterclaim or other deduction. The Administrative Agent will promptly
thereafter cause to be distributed like funds relating to the payment of principal, interest,
facility fees and letter of credit fees ratably (other than amounts payable pursuant to Section
2.02(b), 2.07, 2.11, 2.14 or 8.04(b)) to the Lenders for the account of their respective Applicable
Lending Offices, and like funds relating to the payment of any other amount payable to any Lender
to such Lender for the account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance of an Assignment and Acceptance
and recording of the information contained therein in the Register pursuant to Section 8.07(d),
from and after the effective date specified in such Assignment and Acceptance, the Administrative
Agent shall make all payments hereunder and under the Notes in respect of the interest assigned
thereby to the Lender assignee thereunder, and the parties to such Assignment and Acceptance shall
make all appropriate adjustments in such payments for periods prior to such effective date directly
between themselves.

          (b) Each Borrower hereby authorizes each Lender, if and to the extent any payment owed to such
Lender by such Borrower is not made when due hereunder, to charge from time to time against any or
all of such Borrower’s accounts with such Lender any amount so due.

20

 

          (c) All computations of interest based on the Prime Rate shall be made by the Administrative
Agent on the basis of a year of 365 or 366 days, as the case may be, and all computations of
interest based on the Eurodollar Rate or the Federal Funds Rate and of fees shall be made by the
Administrative Agent, and all computations of interest pursuant to Section 2.07 shall be made by a
Lender, on the basis of a year of 360 days, in each case for the actual number of days (including
the first day but excluding the last day) occurring in the period for which such interest or fees
are payable. Each determination by the Administrative Agent (or, in
the case of Section 2.07, by a
Lender) of an interest rate hereunder shall be conclusive and binding for all purposes, absent
manifest error.

          (d) Whenever any payment hereunder or under the Notes shall be stated to be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of any interest or fees, as the
case may be; provided that if such extension would cause payment of interest on or principal of a
Eurodollar Rate Advance to be made in the next following calendar month, such payment shall be made
on the next preceding Business Day.

          (e) Unless the Administrative Agent shall have received notice from a Borrower prior to the
date on which any payment is due by such Borrower to the Lenders hereunder that such Borrower will
not make such payment in full, the Administrative Agent may assume that such Borrower has made such
payment in full to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Lender on such due date an amount
equal to the amount then due such Lender. If and to the extent that such Borrower shall not have so
made such payment in full to the Administrative Agent, each Lender shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Lender together with
interest thereon, for each day from the date such amount is distributed to such Lender until the
date such Lender repays such amount to the Administrative Agent, at the Federal Funds Rate.

          (f) Notwithstanding anything to the contrary contained herein, any amount payable by a
Borrower hereunder that is not paid when due (whether at stated maturity, by acceleration or
otherwise) shall (to the fullest extent permitted by law) bear interest from the date when due
until paid in full at a rate per annum equal at all times to the Base Rate plus 2%, payable upon
demand.

     SECTION 2.14 Taxes. (a) Any and all payments by any Borrower hereunder or under any Note
issued by such Borrower shall be made, in accordance with Section 2.13, free and clear of and
without deduction for any and all present or future taxes, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case of each Lender, the
LC Issuer and the Administrative Agent, taxes imposed on its income, and franchise taxes imposed on
it, by the jurisdiction under the laws of which such Lender, the LC Issuer or the Administrative
Agent (as the case may be) is organized or any political subdivision thereof and, in the case of
each Lender, taxes imposed on its income, and franchise taxes imposed on it, by the jurisdiction of
such Lender’s Applicable Lending Office or any political subdivision thereof (all such non-excluded
taxes, levies, imposts, deductions, charges, withholdings
and liabilities being hereinafter referred to as “Taxes”). If a Borrower shall be required by
law to deduct any Taxes from or in respect of any sum payable hereunder or under

21

 

any Note issued by such Borrower to any Lender, the LC Issuer or the Administrative Agent, (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 2.14) such Lender,
the LC Issuer or the Administrative Agent (as the case may be) receives an amount equal to the sum
it would have received had no such deductions been made, (ii) such Borrower shall make such
deductions and (iii) such Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with applicable law.

          (b) In addition, each Borrower severally agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar levies to the extent
arising from the execution, delivery or registration of this Agreement or the Notes (hereinafter
referred to as “Other Taxes”), in each case to the extent attributable to such Borrower; it being
understood that to the extent any Other Taxes so payable are not attributable to any particular
Borrower, each Borrower shall pay its proportionate share thereof (according to the number of
Borrowers at the time such Other Taxes arose).

          (c) No Lender may claim or demand payment or reimbursement in respect of any Taxes or Other
Taxes pursuant to this Section 2.14 if such Taxes or Other Taxes, as the case may be, were imposed
solely as the result of a voluntary change in the location of the jurisdiction of such Lender’s
Applicable Lending Office.

          (d) Each Borrower will indemnify each Lender, the LC Issuer and the Administrative Agent for
the full amount of Taxes or Other Taxes (including any Taxes or Other Taxes imposed by any
jurisdiction on amounts payable under this Section 2.14) paid by such Lender, the LC Issuer or the
Administrative Agent (as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were
correctly or legally asserted, in each case to the extent attributable to such Borrower; it being
understood that to the extent any Taxes, Other Taxes or other liabilities described above are not
attributable to a particular Borrower, each Borrower shall pay its proportionate share thereof
(according to the number of Borrowers at the time such Taxes, Other Taxes or other liability
arose). This indemnification shall be made within 30 days from the date such Lender, the LC Issuer
or the Administrative Agent (as the case may be) makes written demand therefor.

          (e) Prior to the date of an initial borrowing hereunder in the case of each Lender listed on
the signature pages hereof, and on the date of the Assignment and Acceptance pursuant to which it
became a Lender in the case of each other Lender, and from time to time thereafter within 30 days
from the date of request if requested by any Borrower or the Administrative Agent, each Lender
organized under the laws of a jurisdiction outside the United States shall provide the
Administrative Agent and each Borrower with the forms prescribed by the Internal Revenue Service of
the United States certifying that such Lender is exempt from United States withholding taxes with
respect to all payments to be made to such Lender hereunder and under the Notes. If for any reason
during the term of this Agreement, any Lender becomes unable to submit the forms referred to above
or the information or representations contained therein are no longer accurate in any material
respect, such Lender shall notify the Administrative Agent and the Borrowers in writing to that
effect. Unless the Borrowers and the
Administrative Agent have received forms or other documents satisfactory to them indicating

22

 

that payments hereunder or under any Note are not subject to United States withholding tax, the
Borrowers or the Administrative Agent shall withhold taxes from such payments at the applicable
statutory rate in the case of payments to or for any Lender organized under the laws of a
jurisdiction outside the United States and no Lender may claim or demand payment or reimbursement
for such withheld taxes pursuant to this Section 2.14.

          (f) Any
Lender claiming any additional amounts payable pursuant to this
Section 2.14 shall use
its best efforts (consistent with its internal policy and legal and regulatory restrictions) to
change the jurisdiction of its Applicable Lending Office if the making of such a change would avoid
the need for, or reduce the amount of, any such additional amounts which may thereafter accrue and
would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender.

          (g) If a Borrower makes any additional payment to any Lender pursuant to this Section 2.14 in
respect of any Taxes or Other Taxes, and such Lender determines that it has received (i) a refund
of such Taxes or Other Taxes or (ii) a credit against or relief or remission for, or a reduction in
the amount of, any tax or other governmental charge attributable solely to any deduction or credit
for any Taxes or Other Taxes with respect to which it has received payments under this Section
2.14, such Lender shall, to the extent that it can do so without prejudice to the retention of such
refund, credit, relief, remission or reduction, pay to such Borrower such amount as such Lender
shall have determined to be attributable to the deduction or withholding of such Taxes or Other
Taxes. If, within one year after the payment of any such amount to such Borrower, such Lender
determines that it was not entitled to such refund, credit, relief, remission or reduction to the
full extent of any payment made pursuant to the first sentence of
this Section 2.14(g), such
Borrower shall upon notice and demand of such Lender promptly repay the amount of such overpayment.
Any determination made by a Lender pursuant to this Section 2.14(g) shall in the absence of bad
faith or manifest error be conclusive, and nothing in this Section 2.14(g) shall be construed as
requiring any Lender to conduct its business or to arrange or alter in any respect its tax or
financial affairs (except as required by Section 2.14(f)) so that it is entitled to receive such a
refund, credit or reduction or as allowing any Person to inspect any records, including tax
returns, of such Lender.

          (h) Without prejudice to the survival of any other agreement of any Borrower or any Lender
hereunder, the agreements and obligations of the Borrowers and the Lenders contained in this
Section 2.14 shall survive the payment in full of principal and interest hereunder and under the
Notes; provided that no Lender shall be entitled to demand any payment from a Borrower under this
Section 2.14 more than one year following the payment to or for the account of such Lender of all
other amounts payable by such Borrower hereunder and under any Note issued by such Borrower to such
Lender and the termination of such Lender’s Commitment to such
Borrower; provided, further, that
the foregoing proviso shall in no way limit the right of any Lender to demand or receive any
payment under this Section 2.14 to the extent that such payment relates to the retroactive
application of any Taxes or Other Taxes if such demand is made within one year after the
implementation of such Taxes or Other Taxes.

     SECTION 2.15 Sharing of Payments, Etc. If any Lender shall obtain any payment (whether
voluntary, involuntary, through the exercise of any right of set-off, or
otherwise) on account of the Advances made by it to any Borrower or its participation interest
in any Facility

23

 

LC issued for the account of any Borrower (other than pursuant to Section 2.02(b), 2.07, 2.11, 2.14
or 8.04(b)) in excess of its ratable share of payments on account of the Advances to such Borrower
and Facility LCs issued for the account of such Borrower obtained by all Lenders, such Lender shall
forthwith purchase from the other Lenders such participations in the Advances made by them to such
Borrower and/or LC Obligations of such Borrower as shall be necessary to cause such purchasing
Lender to share the excess payment ratably with each of them,
provided that if all or any portion
of such excess payment is thereafter recovered from such purchasing Lender, such purchase from each
Lender shall be rescinded and such Lender shall repay to the purchasing Lender the purchase price
to the extent of such recovery together with an amount equal to such Lender’s ratable share
(according to the proportion of (i) the amount of such Lender’s required repayment to (ii) the
total amount so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered. The Borrowers agree
that any Lender so purchasing a participation from another Lender pursuant to this Section 2.15
may, to the fullest extent permitted by law, exercise all its rights of payment (including the
right of set-off) with respect to such participation as fully as if such Lender were the direct
creditor of the applicable Borrower in the amount of such participation.

     SECTION 2.16 Facility LCs

     SECTION 2.16.1 Issuance. The LC Issuer hereby agrees, on the terms and conditions set
forth in this Agreement (including the limitations set forth in Section 2.01), upon the
request of any Borrower, to issue standby letters of credit and to renew, extend, increase
or otherwise modify Facility LCs (“Modify,” and each
such action a “Modification”) for such
Borrower, from time to time from and including the date of this Agreement and prior to the
Commitment Termination Date for such Borrower. No Facility LC shall have an expiry date
later than the earlier of (a) 364 days after the date of issuance, or of extension or
renewal, thereof or (b) 360 days after the scheduled Commitment Termination Date. No
Facility LC may be renewed or extended, or increased in amount, after the Commitment
Termination Date (but a Facility LC may be decreased in amount or, subject to the foregoing
provisions of this sentence, otherwise amended after such date). By their execution of this
Agreement, the parties hereto agree that on the Closing Date (without any further action by
any Person), each Existing Letter of Credit shall be deemed to have been issued under this
Agreement and the rights and obligations of the issuer and the account party thereunder
shall be subject to the terms hereof.

     SECTION 2.16.2 Participations. Upon the issuance or Modification by the LC Issuer of
a Facility LC in accordance with this Section 2.16 (or, in this case of the Existing
Letters of Credit, on the Closing Date), the LC Issuer shall be deemed, without further
action by any party hereto, to have unconditionally and irrevocably sold to each Lender,
and each Lender shall be deemed, without further action by any party hereto, to have
unconditionally and irrevocably purchased from the LC Issuer, a participation in such
Facility LC (and each Modification thereof) and the related LC Obligations in proportion to
its Pro Rata Share.

24

 

     SECTION 2.16.3 Notice. Subject to Section 2.16.1, the applicable Borrower shall give the LC
Issuer notice prior to 10:00 A.M. (Chicago time) at least five Business Days prior to the proposed
date of issuance or Modification of each Facility LC, specifying the beneficiary, the proposed date
of issuance (or Modification) and the expiry date of such Facility LC, and describing the proposed
terms of such Facility LC and the nature of the transactions proposed to be supported thereby. Upon
receipt of such notice, the LC Issuer shall promptly notify the Administrative Agent, and the
Administrative Agent shall promptly notify each Lender, of the contents thereof and of the amount
of such Lender’s participation in such proposed Facility LC. The issuance or Modification by the LC
Issuer of any Facility LC shall, in addition to the applicable conditions precedent set forth in
Article III (the satisfaction of which the LC Issuer
shall have no duty to ascertain; provided that
the LC Issuer shall not issue any Facility LC if the LC Issuer shall have received written notice
(which has not been rescinded) from the Administrative Agent or any Lender that any applicable
condition precedent to the issuance or modification of such Facility LC has not been satisfied and,
in fact, such condition precedent is not satisfied at the requested time of issuance), be subject
to the conditions precedent that such Facility LC shall be satisfactory to the LC Issuer and that
the applicable Borrower shall have executed and delivered such application agreement and/or such
other instruments and agreements relating to such Facility LC as the LC Issuer shall have
reasonably requested (each a “Facility LC Application”). In the event of any conflict between the
terms of this Agreement and the terms of any Facility LC Application, the terms of this Agreement
shall control.

     SECTION 2.16.4 LC Fees. Each Borrower shall pay to the Administrative Agent, for the account
of the Lenders ratably in accordance with their respective Pro Rata Shares, with respect to each
Facility LC issued for the account of such Borrower, a letter of credit fee at a per annum rate
equal to the LC Fee Rate to such Borrower in effect from time to time on the average daily undrawn
stated amount under such Facility LC, such fee to be payable in arrears on the last day of each
March, June, September and December and on the Final Termination Date for such Borrower (and
thereafter on demand). Each Borrower shall also pay to the LC Issuer for its own account (x) a
fronting fee in an amount and at the times agreed upon between the LC Issuer and such Borrower and
(y) documentary and processing charges in connection with the issuance or Modification of and draws
under Facility LCs in accordance with the LC Issuer’s standard schedule for such charges as in
effect from time to time.

     SECTION 2.16.5 Administration; Reimbursement by Lenders. Upon receipt from the beneficiary of
any Facility LC of any demand for payment under such Facility LC, the LC Issuer shall notify the
Administrative Agent and the Administrative Agent shall promptly notify the applicable Borrower and
each Lender as to the amount to be paid by the LC Issuer as a result of such demand and the
proposed payment date (the “LC Payment Date”). The responsibility of the LC Issuer to the
applicable Borrower and each Lender shall be only to determine that the documents (including each
demand for payment) delivered under each Facility LC in connection with such presentment shall be
in conformity in all material respects with such Facility LC. The LC Issuer shall endeavor to
exercise the same care in the issuance and administration of the Facility LCs as it does with
respect to letters of credit in which no participations are granted, it being

25

 

understood that in the absence of any gross negligence or willful misconduct by the LC Issuer, each
Lender shall be unconditionally and irrevocably liable, without regard to the occurrence of the
Commitment Termination Date or the Final Termination Date for the applicable Borrower, the
occurrence of any Event of Default or Unmatured Event of Default or any condition precedent
whatsoever, to reimburse the LC Issuer on demand for (i) such Lender’s Pro Rata Share of the amount
of each payment made by the LC Issuer under each Facility LC to the extent such amount is not
reimbursed by the applicable Borrower pursuant to Section 2.16.6, plus (ii) interest on the
foregoing amount to be reimbursed by such Lender, for each day from the date of the LC Issuer’s
demand for such reimbursement (or, if such demand is made after 11:00 A.M. (Chicago time) on such
day, from the next succeeding Business Day) to the date on which such Lender pays the amount to be
reimbursed by it, at a rate of interest per annum equal to the Federal Funds Rate for the first
three days and, thereafter, at the Base Rate.

     SECTION 2.16.6 Reimbursement by Borrowers. Each Borrower shall be irrevocably and
unconditionally obligated to reimburse the LC Issuer on or before the applicable LC Payment Date
for any amount to be paid by the LC Issuer upon any drawing under any Facility LC issued for the
account of such Borrower, without presentment, demand, protest or other formalities of any kind;
provided that neither the applicable Borrower nor any Lender shall hereby be precluded from
asserting any claim for direct (but not consequential) damages suffered by such Borrower or such
Lender to the extent, but only to the extent, caused by (i) the willful misconduct or gross
negligence of the LC Issuer in determining whether a request presented under any Facility LC
complied with the terms of such Facility LC or (ii) the LC Issuer’s failure to pay under any
Facility LC after the presentation to it of a request strictly complying with the terms and
conditions of such Facility LC. All such amounts paid by the LC Issuer and remaining unpaid by the
applicable Borrower shall bear interest, payable on demand, for each day until paid at a rate per
annum equal to the Base Rate plus 2%. The LC Issuer will pay to each Lender ratably in accordance
with its Pro Rata Share all amounts received by it from any Borrower for application in payment, in
whole or in part, of the Reimbursement Obligation in respect of any Facility LC issued by the LC
Issuer, but only to the extent such Lender has made payment to the LC Issuer in respect of such
Facility LC pursuant to Section 2.16.5. So long as the Commitment Termination Date has not occurred
with respect to a Borrower, but subject to the terms and conditions of this Agreement (including
the submission of a Notice of Borrowing in compliance with Section 2.02 and the satisfaction of the
applicable conditions precedent set forth in Article III), such Borrower may request Advances
hereunder for the purpose of satisfying any Reimbursement Obligation.

     SECTION
2.16.7 Obligations Absolute. Each Borrower’s obligations
under this Section 2.16 shall
be absolute and unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment which such Borrower may have against the LC Issuer, any Lender
or any beneficiary of a Facility LC. Each Borrower agrees with the LC Issuer and the Lenders that
the LC Issuer and the Lenders shall not be responsible for, and such Borrower’s Reimbursement
Obligation in respect of any Facility LC issued for its account shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements thereon, even if such

26

 

documents should in fact prove to be in any or all respects invalid, fraudulent or forged, or any
dispute between or among such Borrower, any of its Affiliates, the beneficiary of any Facility LC
or any financing institution or other party to whom any Facility LC may be transferred or any
claims or defenses whatsoever of such Borrower or of any of its Affiliates against the beneficiary
of any Facility LC or any such transferee. The LC Issuer shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of any message or advice,
however transmitted, in connection with any Facility LC. Each Borrower agrees that any action taken
or omitted by the LC Issuer or any Lender under or in connection with any Facility LC issued for
the account of such Borrower and the related drafts and documents, if done without gross negligence
or willful misconduct, shall be binding upon such Borrower and shall not put the LC Issuer or any
Lender under any liability to such Borrower. Nothing in this Section 2.16.7 is intended to limit
the right of any Borrower to make a claim against the LC Issuer for damages as contemplated by the
proviso to the first sentence of Section 2.16.6.

     SECTION 2.16.8 Actions of LC Issuer. The LC Issuer shall be entitled to rely, and shall be
fully protected in relying, upon any Facility LC, draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message,
statement, order or other document believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons, and upon advice and statements of legal
counsel, independent accountants and other experts selected by the LC Issuer. The LC Issuer shall
be fully justified in failing or refusing to take any action under this Agreement unless it shall
first have received such advice or concurrence of the Majority Lenders as it reasonably deems
appropriate or it shall first be indemnified to its reasonable satisfaction by the Lenders against
any and all liability and expense which may be incurred by it by reason of taking or continuing to
take any such action. Notwithstanding any other provision of this Section 2.16, the LC Issuer shall
in all cases be fully protected in acting, or in refraining from acting, under this Agreement in
accordance with a request of the Majority Lenders, and such request and any action taken or failure
to act pursuant thereto shall be binding upon the Lenders and any future holder of a participation
in any Facility LC.

     SECTION 2.16.9 Indemnification. Each Borrower hereby agrees to indemnify and hold harmless
each Lender, the LC Issuer and the Administrative Agent, and their respective directors, officers,
agents and employees, from and against any and all claims and damages, losses, liabilities, costs
or expenses which such Lender, the LC Issuer or the Administrative Agent may incur (or which may be
claimed against such Lender, the LC Issuer or the Administrative Agent by any Person whatsoever) by
reason of or in connection with the issuance, execution and delivery or transfer of or payment or
failure to pay under any Facility LC issued for the account of such Borrower or any actual or
proposed use of any such Facility LC, including any claims, damages, losses, liabilities, costs or
expenses which the LC Issuer may incur by reason of or in connection with (i) the failure of any
other Lender to fulfill or comply with its obligations to the LC Issuer hereunder (but nothing
herein contained shall affect any right such Borrower may have against any defaulting Lender) or
(ii) by reason of or on account of the LC Issuer issuing any such Facility LC which specifies that
the term “Beneficiary” included therein includes any successor by operation of law of the named
Beneficiary, but which Facility

27

 

LC does not require that any drawing by any such successor Beneficiary be accompanied by a
copy of a legal document, satisfactory to the LC Issuer, evidencing the appointment of such
successor Beneficiary; provided that no Borrower shall be required to indemnify any Lender,
the LC Issuer or the Administrative Agent for any claims, damages, losses, liabilities,
costs or expenses to the extent, but only to the extent, caused by (x) the willful
misconduct or gross negligence of the LC Issuer in determining whether a request presented
under any Facility LC complied with the terms of such Facility LC or (y) the LC Issuer’s
failure to pay under any Facility LC after the presentation to it of a request strictly
complying with the terms and conditions of such Facility LC. Nothing in this Section
2.16.9 is intended to limit the obligations of any Borrower under any other provision of
this Agreement.

     SECTION 2.16.10 Lenders’ Indemnification. Each Lender shall, ratably in accordance
with its Pro Rata Share, indemnify the LC Issuer, its affiliates and their respective
directors, officers, agents and employees (to the extent not reimbursed by the Borrower)
against any cost, expense (including reasonable counsel fees and disbursements), claim,
demand, action, loss or liability (except such as result from such indemnitees’ gross
negligence or willful misconduct or the LC Issuer’s failure to pay under any Facility LC
after the presentation to it of a request strictly complying with the terms and conditions
of the Facility LC) that such indemnitees may suffer or incur in connection with this
Section 2.16 or any action taken or omitted by such indemnitees hereunder.

     SECTION 2.16.11 Rights as a Lender. In its capacity as a Lender, the LC Issuer shall
have the same rights and obligations as any other Lender.

     SECTION 2.17 Extension of Commitment Termination Date. Exelon may request an extension of the
scheduled Commitment Termination Date for any or all Borrowers by submitting a request for an
extension to the Administrative Agent (an “Extension Request”) no more than 60 days prior to the
scheduled Commitment Termination Date then in effect. The Extension Request must specify the new
scheduled Commitment Termination Date requested by Exelon and the date (which must be at least 30
days after the Extension Request is delivered to the Administrative Agent) as of which the Lenders
must respond to the Extension Request (the “Response Date”). The new scheduled Commitment
Termination Date shall be 364 days after the scheduled Commitment Termination Date in effect at the
time an Extension Request is received, including the scheduled Commitment Termination Date as one
of the days in the calculation of the days elapsed. Promptly upon receipt of an Extension Request,
the Administrative Agent shall notify each Lender of the contents thereof and shall request each
Lender to approve such Extension Request, which approval shall be at the sole discretion of each
Lender. Each Lender approving such Extension Request shall deliver its written consent no later
than the Response Date. If the written consent of each of the Lenders (excluding any Person which
ceases to be a Lender pursuant to Section 8.07(g)(iii)) is received by the Administrative Agent,
the new scheduled Commitment Termination Date specified in the Extension Request shall become
effective on the existing scheduled Commitment Termination Date and the Administrative Agent shall
promptly notify each Borrower and each Lender of the new scheduled Commitment Termination Date. If
all Lenders (including any Person which becomes

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a Lender pursuant to Section 8.07(g)) do not consent to an Extension Request, the scheduled
Commitment Termination Date shall not be extended pursuant to such Extension Request.

ARTICLE III

CONDITIONS TO CREDIT EXTENSIONS

     SECTION 3.01 Conditions Precedent to Initial Credit Extensions. No Lender shall be obligated
to make any Advance, and the LC Issuer shall not be obligated to issue any Facility LC, unless the
Administrative Agent shall have received (a) evidence, satisfactory to the Administrative Agent,
that the Borrowers have paid (or will pay with the proceeds of the initial Credit Extensions) all
amounts then payable under the Existing Agreement (after giving effect to the last sentence of
Section 2.16.1) and (b) subject to Section 3.03, each of the following documents, each dated the
date of the initial Credit Extension (or an earlier date satisfactory to the Administrative Agent,
in form and substance satisfactory to the Administrative Agent and each (except for the Notes) in
sufficient copies to provide one for each Lender:

     (i) The Notes payable to the order of each of the Lenders, respectively;

     (ii) Certified copies of resolutions of the Board of Directors or equivalent
managing body of each Borrower approving the transactions contemplated by this
Agreement and the Notes and of all documents evidencing other necessary
organizational action of such Borrower with respect to this Agreement and the
documents contemplated hereby;

     (iii) A certificate of the Secretary or an Assistant Secretary of each
Borrower certifying (A) the names and true signatures of the officers of such
Borrower authorized to sign this Agreement and the other documents to be delivered
hereunder; (B) that attached thereto are true and correct copies of the articles or
certificate of incorporation and by-laws, or equivalent organizational documents,
of such Borrower, in each case in effect on such date; and (C) that attached
thereto are true and correct copies of all governmental and regulatory
authorizations and approvals required for the due execution, delivery and
performance by such Borrower of this Agreement and the documents contemplated
hereby;

     (iv) A certificate signed by either the chief financial officer, principal
accounting officer or treasurer of each Borrower stating that (A) the
representations and warranties contained in Section 4.01 are correct on and as of
the date of such certificate as though made on and as of such date and (B) no Event
of Default or Unmatured Event of Default has occurred and is continuing on the date
of such certificate; and

     (v) A favorable opinion of Ballard Spahr Andrews & Ingersoll LLC, counsel for
the Borrowers, substantially in the form of Exhibit D.

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     SECTION 3.02 Conditions Precedent to All Credit Extensions. The obligation of each Lender to
make any Advance to any Borrower and of the LC Issuer to issue or modify any Facility LC for the
account of any Borrower shall be subject to the further conditions precedent that (a) in the case
of a Borrowing, the Administrative Agent shall have received consents to such Borrowing (and, if
such requested Borrowing is to be comprised of Eurodollar Rate Advances, to the making of such Type
of Advances), substantially in the form of Exhibit F, from all Lenders, (b) in the case of all
Credit Extensions, on the date of such Credit Extension the following statements shall be true (and
(i) the giving of the applicable Notice of Borrowing and the acceptance by the applicable Borrower
of the proceeds of Advances pursuant thereto and (ii) the request by a Borrower for the issuance or
Modification of a Facility LC shall, in each case, constitute a representation and warranty by such
Borrower that on the date of the making of the applicable Advances or the issuance or Modification
of the applicable Facility LC such statements are true):

          (A) The representations and warranties of such Borrower contained in Section 4.01
(other than the representations and warranties contained in Sections 4.01(e)(i)(B),
4.01(e)(ii)(B) and 4.01(e)(iii)(B) and the first sentence of Section 4.01(f)) are correct
on and as of the date of such Credit Extension, before and after giving effect to such
Credit Extension and, in the case of the making of Advances, the application of the
proceeds therefrom, as though made on and as of such date; and

          (B) No event has occurred and is continuing, or would result from such Credit
Extension or, in the case of the making of Advances, from the application of the proceeds
therefrom, that constitutes an Event of Default or Unmatured Event of Default with respect
to such Borrower.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

     SECTION 4.01 Representations and Warranties of the Borrowers. Each Borrower represents and
warrants as follows:

          (a) Such Borrower is a corporation or limited liability company duly organized, validly
existing and in good standing under the laws of the jurisdiction of its incorporation or
organization.

          (b) The execution, delivery and performance by such Borrower of this Agreement and the Notes
issued by such Borrower are within such Borrower’s powers, have been duly authorized by all
necessary organizational action on the part of such Borrower, and do not and will not contravene
(i) the articles or certificate of incorporation, by-laws or the organizational documents of such
Borrower, (ii) applicable law or (iii) any contractual or legal restriction binding on or affecting
the properties of such Borrower or any of its Subsidiaries.

          (c) No authorization or approval or other action by, and no notice to or filing with, any
governmental authority or regulatory body is required for the due execution, delivery and
performance by such Borrower of this Agreement or the applicable Notes, except an

30

 

appropriate order or orders of (i) the Securities and Exchange Commission under the Public Utility
Holding Company Act of 1935, if applicable, and (ii) the Federal Energy Regulatory Commission, if
applicable, which order or orders have been duly obtained and are (x) in full force and effect and
(y) sufficient for the purposes hereof.

          (d) This Agreement is, and the applicable Notes when delivered hereunder will be, legal, valid
and binding obligations of such Borrowers, enforceable against such Borrower in accordance with
their respective terms, except as the enforceability thereof may be limited by equitable principles
or bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally.

          (e) (i) In the case of PECO, (A) the consolidated balance sheet of PECO and its Subsidiaries
as at December 31, 2004, and the related statements of income and retained earnings and of cash
flows of PECO and its Subsidiaries for the fiscal year then ended, certified by Pricewaterhouse
Coopers LLP, and the unaudited consolidated balance sheet of PECO and its Subsidiaries as at
September 30, 2005, and the related unaudited statements of income for the nine-month period then
ended, copies of which have been furnished to each Lender, fairly present in all material respects
(subject, in the case of such balance sheet and statement of income for the period ended September
30, 2005, to year-end adjustments) the consolidated financial condition of PECO and its
Subsidiaries as at such dates and the consolidated results of the operations of PECO and its
Subsidiaries for the periods ended on such dates, all in accordance with GAAP; and (B) since
December 31, 2004 there has been no Material Adverse Change with respect to PECO.

     (ii) In the case of Exelon, (A) the consolidated balance sheet of Exelon and
its Subsidiaries as at December 31, 2004 and the related consolidated statements of
income, retained earnings and cash flows of Exelon for the fiscal year then ended,
certified by Pricewaterhouse Coopers LLP, and the unaudited consolidated balance
sheet of Exelon and its Subsidiaries as of September 30, 2005 and the related
unaudited statement of income for the nine-month period then ended, copies of which
have been furnished to each Lender, fairly present in all material respects
(subject, in the case of such balance sheet and statement of income for the period
ended September 30, 2005, to year-end adjustments) the consolidated financial
condition of Exelon and its Subsidiaries as at such dates and the consolidated
results of the operations of Exelon and its Subsidiaries for the periods ended on
such dates in accordance with GAAP; and (B) since December 31, 2004 there has been
no Material Adverse Change with respect to Exelon.

     (iii) In the case of Genco, (A) the consolidated balance sheet of Genco and
its Subsidiaries as at December 31, 2004 and the related consolidated statements of
income, retained earnings and cash flows of Genco for the fiscal year then ended,
certified by Pricewaterhouse Coopers LLP, and the unaudited consolidated balance
sheet of Genco and its Subsidiaries as of September 30, 2005 and the related
unaudited statement of income for the nine-month period then ended, copies of
which have been furnished to each Lender, fairly present in all material
respects (subject, in the case of such balance sheet and statement of

31

 

income for the period ended September 30, 2005, to year-end adjustments) the
consolidated financial condition of Genco and its Subsidiaries as at such dates and
the consolidated results of the operations of Genco and its Subsidiaries for the
periods ended on such dates in accordance with GAAP; and (B) since December 31,
2004 there has been no Material Adverse Change with respect to Genco.

          (f) Except as disclosed in such Borrower’s Annual, Quarterly or Current Reports, each as filed
with the Securities and Exchange Commission and delivered to the Lenders prior to the later of the
date of execution and delivery of this Agreement or the date of the most recent extension of the
Commitment Termination Date pursuant to Section 2.17, and, in the case of Exelon, on and after the
PSEG Merger Date, as disclosed in any Annual, Quarterly or Current Report of PSEG or any Subsidiary
thereof filed with the Securities and Exchange Commission prior to October 25, 2005, and, in the
case of Genco, on and after the Power Merger Date, as disclosed in any Annual, Quarterly or Current
Report of Power filed with the Securities and Exchange Commission prior to October 25, 2005, there
is no pending or threatened action, investigation or proceeding affecting such Borrower or any of
its Subsidiaries before any court, governmental agency or arbitrator that may reasonably be
anticipated to have a Material Adverse Effect with respect to such Borrower. There is no pending or
threatened action or proceeding against such Borrower or any of its Subsidiaries that purports to
affect the legality, validity, binding effect or enforceability against such Borrower of this
Agreement or any Note issued by such Borrower.

          (g) No proceeds of any Advance to such Borrower have been or will be used directly or
indirectly in connection with the acquisition of in excess of 5% of any class of equity securities
that is registered pursuant to Section 12 of the Exchange Act or any transaction subject to the
requirements of Section 13 or 14 of the Exchange Act.

          (h) Such Borrower is not engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of Regulation U issued by the Board of
Governors of the Federal Reserve System), and no proceeds of any Advance to such Borrower will be
used to purchase or carry any margin stock or to extend credit to others for the purpose of
purchasing or carrying any margin stock. Not more than 25% of the value of the assets of such
Borrower and its Subsidiaries is represented by margin stock.

          (i) Such Borrower is not an “investment company” or a company “controlled” by an “investment
company” within the meaning of the Investment Company Act of 1940, as amended.

          (j) During the twelve consecutive month period prior to the date of the execution and delivery
of this Agreement and prior to the date of any borrowing of Advances by such Borrower or the
issuance or modification of any Facility LC for the account of such Borrower, no steps have been
taken to terminate any Plan (excluding any termination arising out of the institution by or against
any ComEd Entity of any bankruptcy, insolvency or similar proceeding so long as such termination
will not constitute an Event of Default or Unmatured Event of Default under Section 6.01(g))., and
there is no “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302
of ERISA) with respect to any Plan. No condition exists or event or transaction has occurred with
respect to any Plan (including any

32

 

Multiemployer Plan) which might result in the incurrence by such Borrower or any other member of
the Controlled Group of any material liability (other than to make contributions, pay annual PBGC
premiums or pay out benefits in the ordinary course of business), fine or penalty (excluding any
condition, event or transaction arising out of the institution by or against any ComEd Entity of
any bankruptcy, insolvency or similar proceeding so long as such condition, event or transaction
does not constitute an Event of Default or Unmatured Event of Default under Section 6.01(g)).

ARTICLE V

COVENANTS OF THE BORROWERS

     SECTION 5.01 Affirmative Covenants. Each Borrower agrees that so long as any amount payable by
such Borrower hereunder remains unpaid, any Facility LC issued for the account of such Borrower
remains outstanding or the Commitments to such Borrower have not been irrevocably terminated, such
Borrower will, and, in the case of Section 5.01(a), will cause its Principal Subsidiaries to,
unless the Majority Lenders shall otherwise consent in writing:

          (a) Keep Books; Existence; Maintenance of Properties; Compliance with Laws; Insurance; Taxes.

     (i) keep proper books of record and account, all in accordance with generally
accepted accounting principles in the United States, consistently applied;

     (ii) subject to Section 5.02(b) preserve and keep in full force and effect its
existence;

     (iii) maintain and preserve all of its properties (except such properties the
failure of which to maintain or preserve would not have, individually or in the
aggregate, a Material Adverse Effect on such Borrower) which are used or useful in
the conduct of its business in good working order and condition, ordinary wear and
tear excepted;

     (iv) comply in all material respects with the requirements of all applicable
laws, rules, regulations and orders (including those of any governmental authority
and including with respect to environmental matters) to the extent the failure to
so comply, individually or in the aggregate, would have a Material Adverse Effect
on such Borrower;

     (v) maintain insurance with responsible and reputable insurance companies or
associations, or self-insure, as the case may be, in each case in such amounts and
covering such contingencies, casualties and risks as is customarily carried by or
self-insured against by companies engaged in similar businesses and owning similar
properties in the same general areas in which such Borrower and its Principal
Subsidiaries operate;

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     (vi) at any reasonable time and from time to time, pursuant to prior notice delivered
to such Borrower, permit any Lender, or any agent or representative of any thereof, to
examine and, at such Lender’s expense, make copies of, and abstracts from the records and
books of account of, and visit the properties of, such Borrower and any of its Principal
Subsidiaries and to discuss the affairs, finances and accounts of such Borrower and any of
its Principal Subsidiaries with any of their respective officers;
provided that any
non-public information (which has been identified as such by such Borrower or the
applicable Principal Subsidiary) obtained by any Lender or any of its agents or
representatives pursuant to this clause (vi) shall be treated confidentially by such
Person; provided, further, that such Person may disclose such information to any other
party to this Agreement, its examiners, affiliates, outside auditors, counsel or other
professional advisors in connection with the Agreement or if otherwise required to do so by
law or regulatory process;

     (vii) use the proceeds of the Advances to it for general corporate or limited
liability company purposes, as the case may be (including primarily for the issuance of
standby letters of credit for the account of any Borrower (or jointly for the account of a
Borrower and any of its Subsidiaries)) but in no event for any purpose which would be
contrary to Section 4.01(g) or 4.01(h); and

     (viii) pay, prior to delinquency, all of its federal income taxes and other material
taxes and governmental charges, except to the extent that (a) such taxes or charges are
being contested in good faith and by proper proceedings and against which adequate reserves
are being maintained or (b) failure to pay such taxes or charges would not reasonably be
expected to have a Material Adverse Effect.

             (b) Reporting Requirements. Furnish to the Lenders:

     (i) as soon as possible, and in any event within five Business Days after the
occurrence of any Event of Default or Unmatured Event of Default with respect to such
Borrower continuing on the date of such statement, a statement of an authorized officer of
such Borrower setting forth details of such Event of Default or Unmatured Event of Default
and the action which such Borrower proposes to take with respect thereto;

     (ii) as soon as available and in any event within 60 days after the end of each of the
first three quarters of each fiscal year of such Borrower (commencing with the quarter
ending September 30, 2005), a copy of such Borrower’s Quarterly Report on Form 10-Q filed
with the Securities and Exchange Commission with respect to such quarter (or, if such
Borrower is not required to file a Quarterly Report on Form 10-Q, copies of an unaudited
consolidated balance sheet of such Borrower as of the end of such quarter and the related
consolidated statement of income of such Borrower for the portion of such Borrower’s fiscal
year ending on the last day of such quarter, in each case prepared in accordance with GAAP,
subject to the absence of footnotes and to

34

 

year-end adjustments), together with a certificate of an authorized officer of such
Borrower stating that no Event of Default or Unmatured Event of Default with respect to
such Borrower has occurred and is continuing or, if any such Event of Default or Unmatured
Event of Default has occurred and is continuing, a statement as to the nature thereof and
the action which such Borrower proposes to take with respect thereto;

     (iii) as soon as available and in any event within 105 days after the end of each
fiscal year of such Borrower, a copy of such Borrower’s Annual Report on Form 10-K filed
with the Securities and Exchange Commission with respect to such fiscal year (or, if such
Borrower is not required to file an Annual Report on Form 10-K, the consolidated balance
sheet of such Borrower and its subsidiaries as of the last day of such fiscal year and the
related consolidated statements of income, retained earnings (if applicable) and cash flows
of such Borrower for such fiscal year, certified by Pricewaterhouse Coopers LLP or other
certified public accountants of recognized national standing), together with a certificate
of an authorized officer of such Borrower stating that no Event of Default or Unmatured
Event of Default with respect to such Borrower has occurred and is continuing or, if any
such Event of Default or Unmatured Event of Default has occurred and is continuing, a
statement as to the nature thereof and the action which such Borrower proposes to take with
respect thereto;

     (iv) concurrently with the delivery of the annual and quarterly reports referred to in
Sections 5.01(b)(ii) and 5.01(b)(iii), a compliance certificate in substantially the form
set forth in Exhibit E, duly completed and signed by the Chief Financial Officer, Treasurer
or an Assistant Treasurer of such Borrower;

     (v)
except as otherwise provided in clause (ii) or (iii) above, promptly after the
sending or filing thereof, copies of all reports that such Borrower sends to any of its
security holders, and copies of all Reports on Form 10-K, 10-Q or 8-K, and registration
statements and prospectuses that such Borrower or any of its Subsidiaries files with the
Securities and Exchange Commission or any national securities exchange (except to the
extent that any such registration statement or prospectus relates solely to the issuance of
securities pursuant to employee purchase, benefit or dividend reinvestment plans of such
Borrower or such Subsidiary);

     (vi) promptly upon becoming aware of the institution of any steps by such Borrower or
any other Person to terminate any Plan, or the failure to make a required contribution to
any Plan if such failure is sufficient to give rise to a lien under section 302(f) of
ERISA, or the taking of any action with respect to a Plan which could result in the
requirement that such Borrower furnish a bond or other security to the PBGC or such Plan,
or the occurrence of any event with respect to any Plan which could result in the
incurrence by such Borrower or any other member of the Controlled Group of any material
liability, fine or penalty, notice thereof and a statement as to the action such Borrower
proposes to take with respect thereto;

35

 

     (vii) promptly upon becoming aware thereof, notice of any change in the
Moody’s Rating or the S&P Rating for such Borrower; and

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

Each Borrower may provide information, documents and other materials that it is obligated to
furnish to the Administrative Agent pursuant to this Section 5.01(b) and all other notices,
requests, financial statements, financial and other reports, certificates and other information
materials, but excluding any communication that (i) relates to a request for a Credit Extension,
(ii) relates to the payment of any amount due under this Agreement prior to the scheduled date
therefor or any reduction of the Commitments, (iii) provides notice of any Event of Default or
Unmatured Event of Default or (iv) is required to be delivered to satisfy any condition precedent
to the effectiveness of this Agreement or any Credit Extension hereunder (any non-excluded
communication described above, a “Communication”), electronically (including by posting such
documents, or providing a link thereto, on Exelon’s Internet website). Notwithstanding the
foregoing, each Borrower agrees that, to the extent requested by the Administrative Agent, it will
continue to provide “hard copies” of Communications to the Administrative Agent.

Each Borrower further agrees that the Administrative Agent may make Communications available to the
Lenders by posting such Communications on Intralinks or a substantially similar electronic
transmission system (the “Platform”).

THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE”. THE ADMINISTRATIVE AGENT DOES NOT WARRANT THE
ACCURACY OR COMPLETENESS OF ANY COMMUNICATION OR THE ADEQUACY OF THE PLATFORM AND EXPRESSLY
DISCLAIMS LIABILITY FOR ERRORS OR OMISSIONS IN ANY COMMUNICATION. NO WARRANTY OF ANY KIND, EXPRESS,
IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY
THE ADMINISTRATIVE AGENT IN CONNECTION WITH ANY COMMUNICATION OR THE PLATFORM. IN NO EVENT SHALL
THE ADMINISTRATIVE AGENT HAVE ANY LIABILITY TO ANY BORROWER, ANY LENDER OR ANY OTHER PERSON FOR
DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT, CONTRACT OR OTHERWISE) ARISING OUT OF ANY BORROWER’S
OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET, EXCEPT TO THE
EXTENT SUCH DAMAGES ARE FOUND IN A FINAL NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT
JURISDICTION TO HAVE RESULTED FROM SUCH PERSON’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. WITHOUT
LIMITING THE FOREGOING, UNDER NO CIRCUMSTANCES SHALL THE ADMINISTRATIVE AGENT BE LIABLE FOR ANY
INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OF THE PLATFORM OR
ANY BORROWER’S OR THE ADMINISTRATIVE AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET.

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Each Lender agrees that notice to it (as provided in the next sentence) specifying that a
Communication has been posted to the Platform shall constitute effective delivery of such
Communication to such Lender for purposes of this Agreement. Each Lender agrees (i) to notify the
Administrative Agent from time to time of the e-mail address to which the foregoing notice may be
sent and (ii) that such notice may be sent to such e-mail address.

     SECTION 5.02 Negative Covenants. Each Borrower agrees that so long as any amount payable by
such Borrower hereunder remains unpaid, any Facility LC issued for the account of such Borrower
remains outstanding or the Commitments to such Borrower have not been irrevocably terminated
(except with respect to Section 5.02(a), which shall be applicable only as of the date hereof and
at any time any Advance to such Borrower or Facility LC issued for the account of such Borrower is
outstanding or is to be made or issued, as applicable), such Borrower will not, without the written
consent of the Majority Lenders:

          (a) Limitation on Liens. Create, incur, assume or suffer to exist, or, in the case of Exelon,
permit any of its Material Subsidiaries to create, incur, assume or suffer to exist, any Lien on
its respective property, revenues or assets, whether now owned or hereafter acquired except (i)
Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens and other similar
Liens arising in the ordinary course of business; (ii) Liens on the capital stock of or any other
equity interest in any of its Subsidiaries (excluding, in the case of Exelon, the stock of PECO,
Genco and, on and after the PSEG Merger Date, PSE&G, and any holding company for any of the
foregoing) or any such Subsidiary’s assets to secure Nonrecourse Indebtedness; (iii) Liens upon or
in any property acquired in the ordinary course of business to secure the purchase price of such
property or to secure any obligation incurred solely for the purpose of financing the acquisition
of such property; (iv) Liens existing on such property at the time of its acquisition (other than
any such Lien created in contemplation of such acquisition unless
permitted by the preceding clause
(iii); (v) Liens on the property, revenues and/or assets of any Person that exist at the time such
Person becomes a Subsidiary and the continuation of such Liens in connection with any refinancing
or restructuring of the obligations secured by such Liens; (vi) Liens granted in connection with
any financing arrangement for the purchase of nuclear fuel or the financing of pollution control
facilities, limited to the fuel or facilities so purchased or acquired; (vii) Liens arising in
connection with sales or transfers of, or financing secured by, accounts receivable or related
contracts; provided that any such sale, transfer or financing shall be on arms’ length terms;
(viii) Liens granted by a Special Purpose Subsidiary to secure Transitional Funding Instruments of
such Special Purpose Subsidiary; (ix) in the case of PECO, (A) Liens granted under the PECO
Mortgage and “excepted encumbrances” as defined in the PECO Mortgage, and (B) Liens securing PECO’s
notes collateralized solely by mortgage bonds of PECO issued under the terms of the PECO Mortgage;
(x) in the case of Exelon (on and after the PSEG Merger Date), (A) Liens granted under the PSE&G
Mortgage and Liens permitted under the PSE&G Mortgage, and (B) Liens securing PSE&G’s notes
collateralized solely by mortgage bonds of PSE&G issued under the terms of the PSE&G Mortgage, (xi)
in the case of PECO and Genco, Liens arising in connection with sale and leaseback transactions
entered into by such Borrower or a Subsidiary thereof, but only to the extent (I) in the case of
PECO or any Subsidiary thereof, the proceeds received from such sale shall immediately be applied
to retire mortgage bonds of PECO issued under the terms of the PECO Mortgage, or (II) the aggregate
purchase price of assets sold pursuant to such sale and leaseback transactions where such proceeds
are not applied as provided in clause (I) shall not exceed, in the aggregate for PECO, Genco and
their Subsidiaries,

37

 

$1,000,000,000; (xii) in the case of Exelon (on and after the PSEG Merger Date), Liens arising in
connection with sale and leaseback transactions entered into by PSE&G or a Subsidiary thereof, but
only to the extent (I) the proceeds received from such sale shall immediately be applied to retire
mortgage bonds of PSE&G issued under the terms of the PSE&G Mortgage, or (II) the aggregate
purchase price of assets sold pursuant to such sale and leaseback transactions where such proceeds
are not applied as provided in clause (I) shall not exceed, in the aggregate for PSE&G and its
Subsidiaries, $50,000,000, (xiii) Liens securing Permitted Obligations; and (xiv) Liens, other than
those described in clauses (i) through (xiii) of this Section 5.02(a), granted by such Borrower or,
in the case of Exelon, any of its Material Subsidiaries in the ordinary course of business securing
Debt of such Borrower and, if applicable, such Material Subsidiaries; provided that the aggregate
amount of all Debt secured by Liens permitted by clause (xiv) of
this Section 5.02(a) shall not
exceed in the aggregate at any one time outstanding (I) in the case of Exelon and its Material
Subsidiaries, $100,000,000, (II) in the case of Genco, $50,000,000 (prior to the Power Merger Date)
and $75,000,000 (on and after the Power Merger Date), and (III) in the case of PECO, $50,000,000.

          (b) Mergers and Consolidations; Disposition of Assets. Merge with or into or consolidate with
or into, or sell, assign, lease or otherwise dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether now owned or hereafter acquired)
to any Person or permit any Principal Subsidiary to do so, except that (i) any of its Principal
Subsidiaries may merge with or into or consolidate with or transfer assets to any other Principal
Subsidiary of such Borrower, (ii) any of its Principal Subsidiaries may merge with or into or
consolidate with or transfer assets to such Borrower and (iii) such Borrower or any of its
Principal Subsidiaries may merge with or into or consolidate with or transfer assets to any other
Person; provided that, in each case, immediately before and after giving effect thereto, no Event
of Default or Unmatured Event of Default with respect to such Borrower shall have occurred and be
continuing and (A) in the case of any such merger, consolidation or transfer of assets to which a
Borrower is a party, either (x) such Borrower shall be the surviving entity or (y) the surviving
entity shall be an Eligible Successor and shall have assumed all of the obligations of such
Borrower under this Agreement and the Notes issued by such Borrower and the Facility LCs issued for
the account of such Borrower pursuant to a written instrument in form and substance satisfactory to
the Administrative Agent, (B) subject to clause (A) above, in the case of any such merger,
consolidation or transfer of assets to which any of its Principal Subsidiaries is a party, a
Principal Subsidiary of such Borrower shall be the surviving entity
and (C) subject to clause (A)
above, in the case of any such merger, consolidation or transfer of assets to which a Material
Subsidiary of Exelon is a party, a Material Subsidiary of Exelon shall be the surviving entity.

          (c) Interest Coverage Ratio. Permit its Interest Coverage Ratio as of the last day of any
fiscal quarter to be less than (i) in the case of Exelon, 2.65 to 1.0; (ii) in the case of PECO,
2.25 to 1.0; and (iii) in the case of Genco, 3.25 to 1.0.

          (d) Continuation of Businesses. Engage in, or permit any of its Subsidiaries (other than any
ComEd Entity or, on or after the PSEG Merger Date, Energy Holdings Entity) to engage in, any line
of business which is material to Exelon and its Subsidiaries, taken as a whole, other than
businesses engaged in by such Borrower and its Subsidiaries as of the date hereof and reasonable
extensions thereof.

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          (e) Capital Structure. In the case of Exelon, fail at any time to own, free and clear of all
Liens, 100% of the issued and outstanding common shares or other common ownership interests of each
of PECO and, on and after the PSEG Merger Date, PSE&G and 100% of the issued and outstanding
membership interests of Genco (or, in any such case, 100% of a holding company which owns, free and
clear of all Liens, at least 100% of the issued and outstanding common shares or other common
ownership interests of PECO or, on and after the PSEG Merger Date, PSE&G, as applicable, or 100% of
the issued and outstanding membership interests of Genco).

          (f) Restrictive Agreements. In the case of Exelon, permit Genco, PECO or, on and after the
PSEG Merger Date, PSE&G, or any holding company for any of the foregoing described in the
parenthetical clause at the end of Section 5.02(e), to, directly or indirectly, enter into, incur
or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any
condition upon the ability of such entity to declare or pay dividends to Exelon (or, if applicable,
to its holding company), except for existing restrictions on (i) PECO relating to (A) the priority
of payments on its subordinated debentures contained in the Indenture dated as of July 1, 1994
between PECO and Wachovia Bank, National Association (f/k/a First Union National Bank), as trustee,
as amended and supplemented to the date hereof, or any other indenture that has terms substantially
similar to such Indenture and that relates to the issuance of trust preferred securities, and (B)
the priority payment of quarterly dividends on its preferred stock contained in its Amended and
Restated Articles of Incorporation as in effect on the date hereof; and (ii) PSE&G relating to the
priority payment of dividends on any outstanding shares of its prior preferred stock and preference
stock as set forth in its Restated Certificate of Incorporation, as is in effect on the date
hereof.

ARTICLE VI

EVENTS OF DEFAULT

     SECTION 6.01 Events of Default. If any of the following events shall occur and be continuing
with respect to a Borrower (any such event an “Event of Default” with respect to such Borrower):

          (a) Such Borrower shall fail to pay (i) any principal of any Advance to such Borrower when the
same becomes due and payable, (ii) any Reimbursement Obligation of such Borrower within one
Business Day after the same becomes due and payable or (iii) any interest on any Advance to such
Borrower or any other amount payable by such Borrower under this Agreement or any Note issued by
such Borrower within three Business Days after the same becomes due and payable; or

          (b) Any representation or warranty made by such Borrower herein or by such Borrower (or any of
its officers) pursuant to the terms of this Agreement shall prove to have been incorrect or
misleading in any material respect when made; or

          (c) Such Borrower shall fail to perform or observe (i) any term, covenant or agreement
contained in Section 5.01(a)(vii), Section 5.01(b)(i) or Section 5.02, in each case to the extent
applicable to such Borrower, or (ii) any other term, covenant or agreement contained

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in this Agreement on its part to be performed or observed if the failure to perform or observe such
other term, covenant or agreement shall remain unremedied for 30 days after written notice thereof
shall have been given to such Borrower by the Administrative Agent (which notice shall be given by
the Administrative Agent at the written request of any Lender); or

          (d) Such Borrower or any Principal Subsidiary thereof shall fail to pay any principal of or
premium or interest on any Debt that is outstanding in a principal amount in excess of $50,000,000
in the aggregate (but excluding Debt hereunder, Nonrecourse Indebtedness and Transitional Funding
Instruments) of such Borrower or such Principal Subsidiary (as the case may be) when the same
becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand
or otherwise), and such failure shall continue after the applicable grace period, if any, specified
in the agreement or instrument relating to such Debt; or any other event shall occur or condition
shall exist under any agreement or instrument relating to any such Debt and shall continue after
the applicable grace period, if any, specified in such agreement or instrument, if the effect of
such event or condition is to accelerate, or to permit the acceleration of, the maturity of such
Debt; or any such Debt shall be declared to be due and payable, or required to be prepaid (other
than by a regularly scheduled required prepayment), prior to the stated maturity thereof, other
than any acceleration of any Debt secured by equipment leases or fuel leases of such Borrower or a
Principal Subsidiary thereof as a result of the occurrence of any event requiring a prepayment
(whether or not characterized as such) thereunder, which prepayment will not result in a Material
Adverse Change with respect to such Borrower; or

          (e) Such Borrower or any Principal Subsidiary thereof (other than a Special Purpose
Subsidiary) shall generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against such Borrower or any Principal
Subsidiary thereof (other than a Special Purpose Subsidiary) seeking to adjudicate it as bankrupt
or insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry of an order for relief or
the appointment of a receiver, trustee, custodian or other similar official for it or for any
substantial part of its property and, in the case of any such proceeding instituted against it (but
not instituted by it), either such proceeding shall remain undismissed or unstayed for a period of
60 days, or any of the actions sought in such proceeding (including the entry of an order for
relief against, or the appointment of a receiver, trustee, custodian or other similar official for,
it or for any substantial part of its property,) shall occur; or such Borrower or any Principal
Subsidiary thereof (other than a Special Purpose Subsidiary) shall take any action to authorize or
to consent to any of the actions set forth above in this Section 6.01(e); or

          (f) One or more judgments or orders for the payment of money in an aggregate amount exceeding
$50,000,000 (excluding any such judgments or orders which are fully covered by insurance, subject
to any customary deductible, and under which the applicable insurance carrier has acknowledged such
full coverage in writing) shall be rendered against such Borrower or any Principal Subsidiary
thereof and either (i)
enforcement proceedings shall have been commenced by any creditor upon such judgment or order
or (ii) there shall be any period of

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

          (g) (i) Any Reportable Event that the Majority Lenders determine in good faith is reasonably
likely to result in the termination of any Plan or in the appointment by the appropriate United
States District Court of a trustee to administer a Plan shall have occurred and be continuing 60
days after written notice to such effect shall have been given to such Borrower by the
Administrative Agent; (ii) any Plan shall be terminated; (iii) a Trustee shall be appointed by an
appropriate United States District Court to administer any Plan; (iv) the PBGC shall institute
proceedings to terminate any Plan or to appoint a trustee to administer any Plan; or (v) any
Borrower or any member of the Controlled Group withdraws from any
Multiemployer Plan; provided that
on the date of any event described in clauses (i) through
(v) above, the Unfunded Liabilities of
the applicable Plan exceed $100,000,000; and provided,further, that no event described in this
Section 6.01(g) that arises out of the institution by or against any ComEd Entity of any
bankruptcy, insolvency or similar proceeding shall constitute an Event of Default with respect to
any Borrower unless 15 days shall have elapsed after the Majority Lenders have reasonably
determined, and notified the Borrower in writing, that such event has had or is reasonably likely
to have a Material Adverse Effect (disregarding, solely for purposes of this Section 6.01(g),
subclause (b) of the proviso to clause (i) of the definition of Material Adverse Effect) on such
Borrower; or

          (h) In the case of PECO, Exelon (or a wholly owned Subsidiary of Exelon) shall fail to own,
free and clear of all Liens, 100% of its issued and outstanding common shares or other common
ownership interests; or

          (i) In the case of Genco, Exelon (or a wholly owned Subsidiary of Exelon) shall fail to own,
free and clear of all Liens, 100% of the membership interests of Genco;

then, and in any such event, the Administrative Agent shall at the request, or may with the
consent, of the Majority Lenders, by notice to such Borrower, (i) declare the respective
Commitments of the Lenders to such Borrower and the commitment of the LC Issuer to issue Facility
LCs for the account of such Borrower to be terminated, whereupon the same shall forthwith
terminate, and/or (ii) declare the principal amount outstanding under the Notes issued by such
Borrower, all interest thereon and all other amounts payable under this Agreement by such Borrower
(including all contingent LC Obligations) to be forthwith due and payable, whereupon the principal
amount outstanding under such Notes, all such interest and all such other amounts shall become and
be forthwith due and payable, without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived by such Borrower;
provided that in the event of an Event
of Default under Section 6.01(e), (A) the obligation of each Lender to make any Advance to such
Borrower and the obligation of the LC Issuer to issue Facility LCs for the account of such Borrower
shall automatically be terminated and (B) the principal amount outstanding under the Notes issued
by such Borrower, all interest thereon and all other amounts payable by such Borrower hereunder
(including all contingent LC Obligations of such Borrower) shall automatically and immediately
become due and payable, without presentment, demand, protest or any notice of any kind, all of
which are hereby expressly waived by such Borrower.

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ARTICLE VII

THE ADMINISTRATIVE AGENT

     SECTION 7.01 Authorization and Action.

     SECTION 7.01.1 Each Lender hereby appoints and authorizes the Administrative Agent to take such
action as administrative agent on its behalf and to exercise such powers under this Agreement as
are delegated to the Administrative Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. As to any matters not expressly provided for by this Agreement
(including enforcement or collection of the Notes), the Administrative Agent shall not be required
to exercise any discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting) upon the instructions
of the Majority Lenders, and such instructions shall be binding upon all Lenders and all holders of
Notes; provided that the Administrative Agent shall not be required to take any action
which exposes the Administrative Agent to personal liability or which is contrary to this Agreement
or applicable law. The Administrative Agent agrees to give to each Lender prompt notice of each
notice given to it by a Borrower pursuant to the terms of this Agreement.

     SECTION 7.01.2 The Administrative Agent may perform any and all of its duties and exercise its
rights hereunder by or through any one or more sub-agents appointed by the Administrative Agent.
The Administrative Agent and any such sub- agent may perform any and all of its duties and exercise
its rights hereunder through its respective Affiliates, directors, officers, employees, agents and
advisors (collectively, the “Related Parties”). The provisions of this Article VII shall
apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such
sub-agent.

     SECTION 7.02 Agent’s Reliance, Etc. Neither the Administrative Agent nor any
of its directors, officers, agents or employees shall be liable for any action taken or omitted to
be taken by it or them under or in connection with this Agreement, except for its or their
respective own gross negligence or willful misconduct. Without limiting the generality of the
foregoing: (i) the Administrative Agent may treat the payee of any Note as the holder thereof until
the Administrative Agent receives and accepts an Assignment and Acceptance entered into by the
Lender which is the payee of such Note, as assignor, and an Eligible Assignee, as assignee, as
provided in Section 8.07: (ii) the Administrative Agent may consult with legal counsel
(including counsel for a Borrower), 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; (iii) the Administrative Agent
makes no warranty or representation to any Lender and shall not be responsible to any Lender for
any statements, warranties or representations (whether written or oral) made in or in connection
with this Agreement; (iv) the Administrative Agent 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 this
Agreement on the part of any Borrower or to inspect the property (including the books and records)
of any Borrower; (v) the Administrative Agent shall not be responsible to any Lender for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value of this

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Agreement or any other instrument or document furnished pursuant hereto; and (vi) the
Administrative Agent shall not incur any liability under or in respect of this Agreement by acting
upon any notice, consent, certificate or other instrument or writing (which may be by telecopier,
telegram, cable or telex) believed by it to be genuine and signed or sent by the proper party or
parties.

     SECTION 7.03 Agent and Affiliates. With respect to its Commitment, Advances
and Notes (if any), JPMorgan shall have the same rights and powers under this Agreement as any
other Lender and may exercise the same as though it were not the
Administrative Agent; and the term “Lender” or “Lenders” shall, unless otherwise expressly
indicated, include JPMorgan in its individual capacity (to the extent applicable). JPMorgan 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, any Borrower, any subsidiary of any Borrower and any
Person who may do business with or own securities of any Borrower or any such subsidiary, all as if
it were not the Administrative Agent and without any duty to account therefor to the Lenders.

     SECTION 7.04 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other Lender and based on
the financial statements referred to in Section 4.0 l(e) and such other documents and
information as it has deemed appropriate, made its own credit analysis and decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in taking or not
taking action under this Agreement.

     SECTION
7.05 Indemnification. The Lenders agree to indemnify
the
Administrative Agent (to the extent not reimbursed by a Borrower), ratably according to their
respective Pro Rata Shares, from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against the Administrative Agent in
any way relating to or arising out of this Agreement or any action taken or omitted by the
Administrative Agent under this Agreement, provided that no Lender shall be liable for any
portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Administrative Agent’s gross negligence or
willful misconduct. Without limiting the foregoing, each Lender agrees to reimburse the
Administrative Agent promptly upon demand for its Pro Rata Share of any out-of-pocket expenses
(including reasonable counsel fees) incurred by the Administrative Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or enforcement (whether
through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, to the extent that such expenses are reimbursable by a
Borrower but for which the Administrative Agent is not reimbursed by such Borrower.

     SECTION 7.06 Successor Administrative Agent. The Administrative Agent may
resign at any time by giving written notice thereof to the Lenders and the Borrowers and may be
removed at any time with or without cause by the Majority Lenders. Upon any such resignation or
removal, the Majority Lenders shall have the right to appoint a successor Administrative Agent. If
no successor Administrative Agent shall have been so appointed by the Majority

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Lenders, and shall have accepted such appointment, within 30 days after the retiring Administrative
Agent’s giving of notice of resignation or the Majority Lenders’ removal of the retiring
Administrative Agent, then the retiring Administrative Agent may, on behalf of the Lenders, appoint
a successor Administrative Agent, which shall be a commercial bank described in clause (i)
or (ii) of the definition of “Eligible Assignee” and having a combined capital and surplus of at
least $150,000,000. Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations
under this Agreement. After any retiring Administrative Agent’s resignation or removal hereunder as
Administrative Agent, the provisions of this Article VII shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Administrative Agent under this
Agreement. Notwithstanding the foregoing, if no Event of Default or Unmatured Event of Default
shall have occurred and be continuing, then no successor Administrative Agent shall be appointed
under
this Section 7.06 without the prior written consent of the Borrowers, which consent shall
not be unreasonably withheld or delayed.

     SECTION 7.07 Arrangers. The title “Arranger” is purely honorific, and no Person
designated as an “Arranger” shall have any duties or responsibilities in such capacity.

ARTICLE VIII

MISCELLANEOUS

     SECTION 8.01 Amendments, Etc. No amendment or waiver of any provision of
this Agreement or the Notes, nor consent to any departure by any Borrower therefrom, shall in any
event be effective unless the same shall be in writing and signed by the Majority Lenders and, in
the case of an amendment, the Borrowers, and then such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given; provided that no
amendment, waiver or consent shall, unless in writing and signed by all the Lenders (other than any
Lender that is a Borrower or an Affiliate of a Borrower), do any of the following: (a) waive any of
the conditions specified in Section 3.01 or 3.02, (b) increase or extend the
Commitments of the Lenders or subject the Lenders to any additional obligations, (c) reduce the
principal of, or interest on, the Notes or any fees or other amounts payable hereunder, (d)
postpone any date fixed for any payment of principal of, or interest on, the Notes or any fees or
other amounts payable hereunder, (e) change the percentage of the Commitments or of the aggregate
unpaid principal amount of the Notes, or the number of Lenders, that shall be required for the
Lenders or any of them to take any action hereunder, or
(f) amend this Section 8.01; provided,
further, that (i) no amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent, in addition to the Lenders required above to take such action, affect the
rights or duties of the Administrative Agent under this Agreement or any Note; and (ii) no
amendment, waiver or consent shall, unless in writing and signed by the LC Issuer, in addition to
the Lenders required above to take such action, affect the rights or duties of the LC Issuer under
this Agreement.

     SECTION 8.02 Notices, Etc. All notices and other communications provided for
hereunder shall be in writing (including telecopier, telegraphic, telex or cable communication)

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and mailed, telecopied, telegraphed, telexed, cabled or delivered, if to any Borrower, at 10 S.
Dearborn, 37th Floor, Chicago, IL 60603, Attention: Michael R. Metzner, Telecopy: (312) 394- 5215;
if to any Lender, at its Domestic Lending Office specified in its Administrative Questionnaire or
in the Assignment and Acceptance pursuant to which it became a Lender; and if to the Administrative
Agent, at its address at 1 Chase Plaza, Mail Suite IL1-0010, Chicago, Illinois 60670, Attention:
Mr. Ron Cromey, Telecopy: (312) 385-7096 with a copy to JPMorgan Chase Bank, 1111 Fannin, 10th
Floor, Houston, TX 77002, Attn: Jaime Garcia, Telecopy: (713) 750-6307 or, as to each party, at
such other address as shall be designated by such party in a written notice to the other parties.
All such notices and communications shall, when mailed, telecopied, telegraphed, telexed or cabled,
be effective when deposited in the mails, telecopied, delivered to the telegraph company, confirmed
by telex answerback or delivered to the cable company, respectively, except that notices and
communications to the Administrative Agent pursuant to Article II or VII shall not
be effective until received by the Administrative Agent.

     SECTION
8.03 No Waiver; Remedies. No failure on the part of any Lender, the
LC Issuer or the Administrative Agent to exercise, and no delay in exercising, any right hereunder
or under any Note shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise of any other right.
The remedies herein provided are cumulative and not exclusive of any remedies provided by law.

     SECTION
8.04 Costs and Expenses; Indemnification. (a) Each Borrower severally
agrees to pay on demand all costs and expenses incurred by the Administrative Agent, the LC Issuer
and the Arrangers in connection with the preparation, execution, delivery, administration,
syndication, modification and amendment of this
Agreement, the Notes and the other documents to be delivered hereunder, including the reasonable
fees, internal charges and out-of-pocket expenses of counsel (including in-house counsel) for the
Administrative Agent, the LC issuer and the Arrangers with respect thereto and with respect to
advising the Administrative Agent, the LC Issuer and the Arrangers as to their respective rights
and responsibilities under this Agreement, in each case to the extent attributable to such
Borrower; it being understood that to the extent any such costs and expenses are not
attributable to a particular Borrower, each Borrower shall pay its proportionate share thereof
(according to the number of Borrowers at the time such costs and expenses were incurred). Each
Borrower further severally agrees to pay on demand all costs and expenses, if any (including
counsel fees and expenses of outside counsel and of internal counsel), incurred by the
Administrative Agent, the LC Issuer or any Lender in connection with the collection and enforcement
(whether through negotiations, legal proceedings or otherwise) of such Borrower’s obligations this
Agreement, the Notes issued by such Borrower and the other documents to be delivered by such
Borrower hereunder, including reasonable counsel fees and expenses in connection with the
enforcement of rights under this Section 8.04(a), in each case to the extent attributable
to such Borrower; it being understood that to the extent any such costs and expenses are
not attributable to a particular Borrower, each Borrower shall pay its proportionate share thereof
(according to the number of Borrowers at the time such costs and expenses were incurred).

          (b) If any payment of principal of, or any conversion of, any Eurodollar Rate Advance is made other
than on the last day of the Interest Period for such Advance, as a result of a payment or
conversion pursuant to Section 2.09 or 2.12 or acceleration of the maturity of the

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Notes pursuant to Section 6.01 or for any other reason, the applicable Borrower shall, upon
demand by any Lender (with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Lender any amount required to compensate such Lender
for any additional losses, costs or expenses which it may reasonably incur as a result of such
payment or conversion, including any loss, cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender to fund or maintain such Advance.

          (c) Each Borrower hereby severally agrees to indemnify and hold each Lender, the LC Issuer, the
Administrative Agent and each of their respective Affiliates, officers, directors and employees
(each, an “Indemnified Person”) harmless from and against any and all claims, damages, losses,
liabilities, costs or expenses (including reasonable attorney’s fees and expenses, whether or not
such Indemnified Person is named as a party to any proceeding or is otherwise subjected to judicial
or legal process arising from any such proceeding) that any of them may pay or incur arising out of
or relating to this Agreement, the Notes or the transactions contemplated thereby, or the use by
such Borrowers or any of its Subsidiaries of the proceeds of any Advance to such Borrower, in each
case to the extent such claims damages, losses, liabilities, costs or expenses are attributable to
such Borrower, it being understood that to the extent any such claims, damages, losses,
liabilities, costs or expenses are not attributable to a particular Borrower, each Borrower shall
pay its proportionate share thereof (according to the number of Borrowers at the time such claims,
damages, losses, liabilities, costs or expenses arose); provided that no Borrower shall be
liable for any portion of such claims, damages, losses, liabilities, costs or expenses resulting
from such Indemnified Person’s gross negligence or willful misconduct. Each Borrower’s obligations
under this Section 8.04(c) shall survive the repayment of all amounts owing by such
Borrower to the Lenders and the Administrative Agent under this Agreement and the Notes issued by
such Borrower and the termination of the Commitments to such Borrower. If and to the extent that
the obligations of a Borrower under this Section 8.04(c) are unenforceable for any reason,
such Borrower agrees to make the maximum contribution to the payment and satisfaction thereof which
is permissible under applicable law.

     SECTION 8.05 Right of Set-off. Upon (i) the occurrence and during the
continuance of any Event of Default with respect to a Borrower and (ii) the making of the request
or the granting of the consent specified by Section 6.01 to authorize the Administrative
Agent to declare the Notes issued by such Borrower due and payable
pursuant to the provisions of Section 6.01, each Lender is hereby authorized at any time
and from time to time, to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by such Lender to or for the credit or the account of such Borrower
against any and all of the obligations of such Borrower now or hereafter existing under this
Agreement and any Note of such Borrower held by such Lender, whether or not such Lender shall have
made any demand under this Agreement or such Note and although such obligations may be unmatured.
Each Lender agrees promptly to notify the applicable Borrower after any such set-off and
application made by such Lender, provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of each Lender under this
Section 8.05 are in addition to other rights and remedies (including other rights of
set-off) that such Lender may have.

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     SECTION 8.06 Binding Effect. This Agreement shall become effective when
counterparts hereof shall have been executed by the Borrowers and the Administrative Agent and when
the Administrative Agent shall have been notified by each Lender that such Lender has executed a
counterpart hereof and thereafter shall be binding upon and inure to the benefit of the Borrowers,
the Administrative Agent and each Lender and their respective successors and assigns,
provided that (except as permitted by Section 5.02(b)(iii)) no Borrower
shall have the right to assign rights hereunder or any interest herein without the prior written
consent of all Lenders.

     SECTION 8.07 Assignments and Participations. (a) Each Lender may, with the
prior written consent of Exelon, the LC Issuer and the Administrative Agent (which consents shall
not be unreasonably withheld or delayed), and if demanded by a
Borrower pursuant to Section
8.07(g) shall to the extent required by such Section, assign to one or more banks or other
entities all or a portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment, the Advances owing to it, its participation in Facility LCs and the Note
or Notes held by it); provided that (i) each such assignment shall be of a constant, and
not a varying, percentage of all of the assigning Lender’s rights and obligations under this
Agreement, (ii) the Commitment Amount of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with respect to such
assignment) shall in no event be less than $500,000 or, if less, the entire amount of such Lender’s
Commitment, and shall be an integral multiple of $500,000 or such Lender’s entire Commitment, (iii)
each such assignment shall be to an Eligible Assignee, (iv) the parties to each such assignment
shall execute and deliver to the Administrative Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with any Note or Notes subject to such assignment
and a processing and recordation fee of $3,500 (which shall be payable by one or more of the
parties to the Assignment and Acceptance, and not by any Borrower, and shall not be payable if the
assignee is a Federal Reserve Bank), and (v) the consent of Exelon shall not be required after the
occurrence and during the continuance of any Event of Default. Upon such execution, delivery,
acceptance and recording, from and after the effective date specified in each Assignment and
Acceptance, (x) the assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, have the
rights and obligations of a Lender hereunder and (y) the Lender assignor thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment
and Acceptance, relinquish its rights and be released from its obligations under this Agreement
and, in the case of an Assignment and Acceptance covering all or the remaining portion of an
assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a
party hereto (although an assigning Lender shall continue to be entitled to indemnification
pursuant to Section 8.04(c)). Notwithstanding anything contained in this Section
8.07(a) to the contrary,
(A) the consent of Exelon, the LC Issuer and the Administrative Agent shall not be required with
respect to any assignment by any Lender to an Affiliate of such Lender or to another Lender and
(B) any Lender may at any time, without the consent of Exelon, the LC Issuer or the
Administrative Agent, and without any requirement to have an Assignment and Acceptance executed,
assign all or any part of its rights under this Agreement and its Notes to a Federal Reserve Bank,
provided that no such assignment shall release the transferor Lender from any of its
obligations hereunder.

47

 

          (b) By executing and delivering an Assignment and Acceptance, the Lender assignor thereunder
and the assignee thereunder confirm to and agree with each other and the other parties hereto as
follows: (i) other than as provided in such Assignment and Acceptance, such assigning Lender makes
no representation or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any
other instrument or document furnished pursuant hereto; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the financial condition of
any Borrower or the performance or observance by any Borrower of any of its obligations under this
Agreement or any other instrument or document furnished pursuant hereto; (iii) such assignee
confirms that it has received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01 (e) and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter into such Assignment
and Acceptance; (iv) such assignee will, independently and without reliance upon the Administrative
Agent, such assigning Lender or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in taking or not
taking action under this Agreement; (v) such assignee confirms that it is an Eligible Assignee;
(vi) such assignee appoints and authorizes the Administrative Agent to take such action as agent on
its behalf and to exercise such powers under this Agreement as are delegated to the Administrative
Agent by the terms hereof, together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by it as a Lender.

          (c) The Administrative Agent shall maintain at its address referred to in Section
8.02 a copy of each Assignment and Acceptance delivered to and accepted by it and a register
for the recordation of the names and addresses of the Lenders and the Commitment Amount of, and
principal amount of the Advances owing by each Borrower to, each Lender from time to time (the
“Register”). The entries in the Register shall be conclusive and binding for all purposes, absent
manifest error, and each Borrower, the Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement.
The Register shall be available for inspection by any Borrower or any Lender at any reasonable time
and from time to time upon reasonable prior notice.

          (d) Upon its receipt of an Assignment and Acceptance executed by an assigning Lender and an
assignee representing that it is an Eligible Assignee, together with all Notes subject to such
assignment, the Administrative Agent shall, if such Assignment and Acceptance has been completed
and is in substantially the form of Exhibit C, (i) accept such Assignment and Acceptance,
(ii) record the information contained therein in the Register and (iii) give prompt notice thereof
to the Borrowers. Within five Business Days after its receipt of such notice, each Borrower, at its
own expense, shall execute and deliver to the Administrative Agent, in exchange for the surrendered
Note issued by such Borrower a new Note to the order of such Eligible Assignee in an amount equal
to the Commitment Amount assumed by such Eligible Assignee pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Commitment hereunder, a new Note to the
order of the assigning Lender in an amount equal to the Commitment Amount of such assigning Lender
after giving effect to such

48

 

assignment. Each such new Note or Notes shall be dated the effective date of such Assignment and
Acceptance and shall otherwise be in substantially the form of
Exhibit A.

          (e) Each Lender may sell participations to one or more banks or other entities (each, a
“Participant”) in or to all or a portion of its rights and/or obligations under this Agreement
(including all or a portion of its Commitment, the Advances owing to
it, its participation in Facility LCs and the Note or Notes held by it); provided that (i)
such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender shall remain the holder of any such Note for all purposes of this Agreement, (iv)
the Borrowers, the Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and obligations under this
Agreement and (v) such Lender shall retain the sole right to approve, without the consent of any
Participant, any amendment, modification or waiver of any provision of this Agreement or the Note
or Notes held by such Lender, other than any such amendment, modification or waiver with respect to
any Advance or Commitment in which such Participant has an interest that forgives principal,
interest or fees or reduces the interest rate or fees payable with respect to any such Advance or
Commitment, postpones any date fixed for any regularly scheduled payment of principal of, or
interest or fees on, any such Advance or Commitment, extends any Commitment, releases any guarantor
of any such Advance or releases any substantial portion of collateral, if any, securing any such
Advance.

          (f) Any Lender may, in connection with any assignment or participation or proposed
assignment or participation pursuant to this Section 8.07, disclose to the assignee or
participant or proposed assignee or participant, any information relating to the Borrowers
furnished to such Lender by or on behalf of the Borrowers; provided that, prior to any such
disclosure, the assignee or participant or proposed assignee or participant shall agree to preserve
the confidentiality of any confidential information relating to the Borrowers received by it from
such Lender (subject to customary exceptions regarding regulatory requirements, compliance with
legal process and other requirements of law).

          (g) If
any Lender shall (i) make demand for payment under
Section 2.11 (a), 2.11(b)
or 2.14, (ii) shall deliver any notice to the Administrative Agent pursuant to Section
2.12 resulting in the suspension of certain obligations of the Lenders with respect to
Eurodollar Rate Advances or (iii) shall fail to consent to, or shall revoke its consent to, an
extension of the scheduled Commitment Termination Date pursuant to Section 2.17, then (in
the case of clause (i)) within 60 days after such demand (if, but only if, such payment
demanded under Section 2.11 (a), 2.11(b) or
2.14 has been made by the applicable Borrower)
or (in the case of clause (ii)) within 60 days after such notice (if such suspension is still in
effect), or (in the case of clause (iii)) no later than five days prior to the then
effective scheduled Commitment Termination Date, as the case may be, the Borrowers may demand that
such Lender assign in accordance with this Section 8.07 to one or more Eligible Assignees
designated by the Borrowers and reasonably acceptable to the Administrative Agent all (but not less
than all) of such Lender’s Commitment, the Advances owing to it and its participation in the
Facility LCs within the next succeeding 30 days (in the case of
clause (i) or clause (ii)),
or within the next succeeding five days (in the case of clause
(iii)). If any such
Eligible Assignee designated by the Borrowers shall fail to consummate such assignment on terms
acceptable to such Lender, or if the Borrowers shall fail

49

 

to designate any such Eligible Assignee for all of such Lender’s Commitment, Advances and
participation in Facility LCs, then such Lender may (but shall not be required to) assign such
Commitment and Advances to any other Eligible Assignee in accordance with this Section 8.07
during such period.

          (h) Notwithstanding
anything to the contrary contained herein, any Lender (a
“Granting Bank”) may
grant to a special purpose funding vehicle (an “SPC”), identified as such in writing from time to
time by the Granting Bank to the Administrative Agent and the Borrowers, the option to provide to
any Borrower all or any part of any Advance that such Granting Bank would otherwise be obligated to
make to such Borrower pursuant to this Agreement; provided that (i) nothing herein shall
constitute a commitment by any SPC to make any Advance, (ii) if an SPC elects not to exercise such
option or otherwise fails to provide all or any part of such Advance, the Granting Bank shall be
obligated to make such Advance pursuant to the terms hereof. The making of an Advance by an SPC
hereunder shall utilize the Commitment of the Granting Bank to the same extent, and as if, such
Advance 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 8.07, any SPC may (i)
with notice to, but without the prior written consent of, the Borrower and the Administrative Agent
and without paying any processing fee therefor, assign all or a portion of its interests in any
Advances to the Granting Bank or to any financial institutions (consented to by such Borrower and
Administrative Agent, neither of which consents shall be unreasonably withheld or delayed)
providing liquidity and/or credit support to or for the account of such SPC to support the funding
or maintenance of Advances and (ii) disclose on a confidential basis any non-public information
relating to its Advances to any rating agency, commercial paper dealer or provider of any surety,
guarantee or credit or liquidity enhancement to such SPC. This Section 8.07(h) may not be
amended in any manner which adversely affects a Granting Bank or an SPC without the written consent
of such Granting Bank or SPC.

     SECTION 8.08 Governing Law. THIS AGREEMENT AND THE NOTES
SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF
PENNSYLVANIA.

     SECTION
8.09 Consent to Jurisdiction; Certain Waivers. (a)
THE
BORROWERS HEREBY IRREVOCABLY SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE
COMMONWEALTH OF PENNSYLVANIA AND ANY UNITED STATES DISTRICT COURT SITTING IN THE COMMONWEALTH OF
PENNSYLVANIA IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE NOTES
AND THE BORROWERS HEREBY IRREVOCABLY AGREE THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING
MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND

50

 

IRREVOCABLY WAIVE ANY OBJECTION THEY MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE ADMINISTRATIVE AGENT OR ANY LENDER TO BRING PROCEEDINGS
AGAINST ANY BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.

          (b) EXCEPT AS PROHIBITED BY LAW, EACH PARTY HERETO HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR
RECOVER IN ANY LITIGATION ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE NOTES ANY SPECIAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES.

     SECTION 8.10 Execution in Counterparts; Integration. This Agreement may be
executed in any number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of which taken together
shall constitute one and the same agreement. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes all prior and contemporaneous agreements and
understandings, oral or written, relating to the subject matter hereof.

     SECTION 8.11 Liability Several. No Borrower shall be liable for the obligations
of any other Borrower hereunder.

     SECTION 8.12 USA PATRIOT ACT NOTIFICATION. The following
notification is provided to the Borrowers pursuant to Section 326 of the USA Patriot Act of 2001,
31 U.S.C. Section 5318:

IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the government fight the
funding of terrorism and money laundering activities, Federal law requires all financial
institutions to obtain, verify, and record information that identifies each person or entity that
opens an account, including
any deposit account, treasury management account, loan, other extension of credit, or other
financial services product. What this means for a Borrower: When any Borrower opens an account, if
such Borrower is an individual, the Administrative Agent and the Lenders will ask for such
Borrower’s name, residential address, tax identification number, date of birth, and other
information that will allow the Administrative Agent and the Lenders to identify such Borrower,
and, if such Borrower is not an individual, the Administrative Agent and the Lenders will ask for
such Borrower’s name, tax identification number, business address, and other information that will
allow the Administrative Agent and the Lenders to identify such Borrower. The Administrative Agent
and the Lenders may also ask, if such Borrower is an individual, to see such Borrower’s driver’s
license or other identifying documents, and, if such Borrower is not an individual, to see such
Borrower’s legal organizational documents or other identifying documents.

51

 

     SECTION 8.13 Termination of Existing Agreement. The Borrowers, the Lenders
which are parties to the Existing Agreement (which Lenders constitute the “Majority Lenders” as
defined in the Existing Agreement) and JPMorgan Chase Bank, N.A., as Administrative Agent under the
Existing Agreement, agree that, on the Closing Date, the commitments under the Existing Agreement
shall terminate and be of no further force or effect (without regard to any requirement in
Section 2.04 of the Existing Agreement for prior notice of termination of the commitments
thereunder).

[Signatures To Follow]

52

 

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

	 	 	 	 	 	 	 
	 	 	EXELON CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	PECO ENERGY COMPANY	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	EXELON GENERATION COMPANY, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	JPMORGAN CHASE BANK, N.A., as

Administrative Agent, as LC Issuer and as

a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	SHOREBANK, as an Arranger and as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	UNITED BANK OF PHILADELPHIA, as an

Arranger and as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	BANCO POPULAR NORTH AMERICA, as a

Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	ADAMS NATIONAL BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	SEAWAY NATIONAL BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	CITIZENS TRUST BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	HIGHLAND COMMUNITY BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	ILLINOIS SERVICE FEDERAL SAVINGS

AND LOAN ASSOCIATION OF CHICAGO, as

a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	BANK FINANCIAL, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	LEGACY BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	NORTH MILWAUKEE STATE BANK,

as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	PACIFIC GLOBAL BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

	 	 	 	 	 	 	 
	 	 	ASIAN BANK, as a Lender	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

Credit Agreement

 

 

SCHEDULE I

PRICING SCHEDULE

	 	 	 	 	 	 	 	 	 
	Status	 	LC Fee Rate	 	Facility Fee Rate
	Level I Status
	 	 	0.50	%	 	 	0.200	%
	Level II Status
	 	 	0.65	%	 	 	0.225	%
	Level III Status
	 	 	0.75	%	 	 	0.250	%
	Level IV Status
	 	 	1.00	%	 	 	0.300	%
	Level V Status
	 	 	1.15	%	 	 	0.350	%

     The LC Fee Rate shall be determined separately for each Borrower in accordance with the
foregoing table based on the Status for such Borrower. The Facility Fee Rate shall be determined in
accordance with the foregoing table based on the Status for Exelon. The applicable Status in effect
on any date for the purposes of this Schedule is based on the applicable Moody’s Rating and S&P
Rating in effect at the close of business on such date.

     For the purposes of the foregoing (but subject to the final paragraph of this Schedule):

     “Level I Status” exists at any date for a Borrower if, on such date, such Borrower’s Moody’s Rating
is A3 or better or such Borrower’s S&P Rating is A- or better.

     “Level II Status” exists at any date for a Borrower if, on such date, (i) Level I Status does not
exist for such Borrower and (ii) such Borrower’s Moody’s Rating is Baal or better or such
Borrower’s S&P Rating is BBB+ or better.

     “Level III Status” exists at any date for a Borrower if, on such date, (i) neither Level I Status
nor Level II Status exists for such Borrower and (ii) such Borrower’s Moody’s Rating is Baa2 or
better or such Borrower’s S&P Rating is BBB or better.

     “Level IV Status” exists at any date for a Borrower if, on such date, (i) none of Level I Status,
Level II Status or Level III Status exists for such Borrower and (ii) such Borrower’s Moody’s
Rating is Baa3 or better or such Borrower’s S&P Rating is BBB- or better.

     “Level V Status” exists at any date for a Borrower if, on such date, none of Level I Status, Level
II Status, Level III Status or Level IV Status exists for such Borrower.

     “Status” means Level I Status, Level II Status, Level III Status, Level IV Status or Level V
Status.

     If the S&P Rating and the Moody’s Rating for a Borrower create a split-rated situation and the
ratings differential is one level, the higher rating will apply. If the differential is two levels
or more, the intermediate rating at the midpoint will apply. If there is no midpoint, the higher of
the two intermediate ratings will apply. If a Borrower has no Moody’s Rating or no S&P Rating,
Level V Status shall exist for such Borrower.

I-1

 

SCHEDULE II

COMMITMENTS AND PRO RATA SHARES

	 	 	 	 	 
	Lender	 	Commitment	 
	ShoreBank, Co-Arranger
	 	$	15,000,000	 
	United Bank of Philadelphia, Co-Arranger
	 	$	1,000,000	 
	JPMorgan Chase Bank, Administrative Agent
	 	$	3,500,000	 
	Banco Popular North America
	 	$	14,000,000	 
	Adams National Bank
	 	$	4,000,000	 
	Seaway National Bank
	 	$	3,000,000	 
	Citizens Bank
	 	$	2,000,000	 
	Highland Community Bank
	 	$	2,000,000	 
	Illinois Service Federal Savings and Loan Association
	 	$	1,000,000	 
	Bank Financial
	 	$	1,000,000	 
	Legacy Bank
	 	$	2,000,000	 
	North Milwaukee State Bank
	 	$	500,000	 
	Pacific Global Bank
	 	$	500,000	 
	Asian Bank
	 	$	500,000	 
	Total
	 	$	50.000.000	 
	 
	 	 	 

II-1

 

SCHEDULE III

EXISTING LETTERS OF CREDIT

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	Outstanding	 	 	 	 
	     Number	 	Type	 	 	Borrower	 	 	Amount	 	 	Expiration	 
	SLT325419
	 	Standby Letter of Credit	 	Exelon	 	$	1,001,725	 	 	 	12/19/2005	 
	SLT325420
	 	Standby Letter of Credit	 	Exelon	 	$	87,669	 	 	 	7/31/2006	 
	SLT325611
	 	Standby Letter of Credit	 	Exelon	 	$	3,400,000	 	 	 	12/19/2005	 
	SLT325715
	 	Standby Letter of Credit	 	Exelon	 	$	20,000	 	 	 	10/10/2006	 
	SLT326947
	 	Standby Letter of Credit	 	Exelon	 	$	1,700,000	 	 	 	8/12/2006	 
	SLT330190
	 	Standby Letter of Credit	 	Exelon	 	$	2,000,000	 	 	 	9/30/2006	 
	SLT330949
	 	Standby Letter of Credit	 	Exelon	 	$	185,000	 	 	 	2/9/2006	 
	SLT332085
	 	Standby Letter of Credit	 	PECO	 	$	1,895,154	 	 	 	12/31/2005	 
	SLT326103
	 	Standby Letter of Credit	 	Exelon	 	$	2,884,188	 	 	 	12/31/2005	 
	SLT329840
	 	Standby Letter of Credit	 	Genco	 	$	335,000	 	 	 	3/31/2006	 
	SLT644088
	 	Standby Letter of Credit	 	Genco	 	$	100,000	 	 	 	7/11/2006	 
	SLT324436
	 	Standby Letter of Credit	 	Genco	 	$	9,329,635	 	 	 	6/17/2006	 
	SLT328320
	 	Standby Letter of Credit	 	Genco	 	$	19,600,000	 	 	 	8/30/2006	 

III-1

 

EXHIBIT A

FORM OF NOTE

Dated: [ ], 20_

          FOR
VALUE RECEIVED, the undersigned,                                          , a
                                        
 (the “Borrower”), HEREBY PROMISES TO PAY to the order of                    
 (the “Lender”), for the account of its Applicable Lending Office (such term and other capitalized
terms herein being used as defined in the Credit Agreement referred to below) on the Commitment
Termination Date, the aggregate principal amount of all outstanding Advances made by the Lender to
the Borrower pursuant to the Credit Agreement.

          The Borrower further promises to pay interest on the unpaid principal amount of each Advance from
the date of such Advance until such principal amount is paid in full, at such interest rates, and
payable at such times, as are specified in the Credit Agreement.

          Both principal and interest are payable in lawful money of the United States of America to JPMorgan
Chase Bank, N.A., as Administrative Agent, at 1 Chase Plaza, Chicago, Illinois 60670 (or such other
address as the Administrative Agent shall notify the Borrower), in immediately available funds.
Each Advance made by the Lender to the Borrower pursuant to the Credit Agreement, and all payments
made on account of principal thereof, shall be recorded by the Lender and, at the Lender’s option,
endorsed on the grid attached hereto which is part of this Promissory Note.

          This Promissory Note is one of the Notes referred to in, and is entitled to the benefits of, the
Credit Agreement dated as of October 28, 2005 among the Borrower, [Exelon Corporation, PECO Energy
Company, Exelon Generation Company, LLC], various financial institutions and JPMorgan Chase Bank,
as Administrative Agent (as
amended, modified or supplemented from time to time, the “Credit Agreement”). The Credit Agreement,
among other things, (i) provides for the making of Advances by the Lender to the Borrower from time
to time in an aggregate amount not to exceed at any time outstanding the Lender’s Pro Rata Share of
the aggregate principal amount of all Advances to such Borrower at such time and (ii) contains
provisions for acceleration of the maturity hereof upon the happening of certain stated events and
also for prepayments on account of principal hereof prior to the maturity hereof upon the terms and
conditions therein specified.

          The Borrower hereby waives presentment, demand, protest and notice of any kind. No failure to
exercise, and no delay in exercising, any rights hereunder on the part of the holder hereof shall
operate as a waiver of such rights.

A-1

 

     THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
COMMONWEALTH OF PENNSYLVANIA.

	 	 	 	 	 	 	 
	 	 	[EXELON CORPORATION]

[PECO ENERGY COMPANY]

[EXELON GENERATION COMPANY, LLC]	 	 
	 
	 	 	 	 	 	 
	 

	 	[By
	 	]	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	[Name:]	 	 
	 

	 	 	 	[Title:]	 	 

A-2

 

ADVANCES AND PAYMENTS OF PRINCIPAL

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Amount of	 	 
	 

	 	 	 	Principal
	 	Unpaid	 	 
	 

	 	Amount of
	 	Paid or
	 	Principal
	 	Notation
	Date

	 	Advance
	 	Prepaid
	 	Balance
	 	Made By

A-3

 

EXHIBIT B

FORM OF NOTICE OF BORROWING

JPMorgan Chase Bank,N.A., as Administrative Agent

for the Lenders parties to the Credit Agreement referred to below

1 Chase Plaza

Chicago, Illinois 60670

with a copy to:

1111 Fannin, 10th Floor,

Houston, TX 77002

[Date]

Attention: Utilities Department

North American Finance Group

Ladies and Gentlemen:

          The undersigned, [Exelon Corporation] [PECO Energy Company] [Exelon Generation Company, LLC],
refers to the Credit Agreement, dated as of October 28, 2005, among Exelon Corporation, PECO Energy
Company, Exelon Generation Company, LLC, various financial institutions and JPMorgan Chase Bank,
N.A., as Administrative Agent (as amended, modified or supplemented from time to time, the “Credit
Agreement”), and hereby gives you notice, irrevocably, pursuant to Section 2.02(a) of the Credit
Agreement that the undersigned requests a Borrowing under the Credit Agreement, and in that
connection sets forth below the information relating to such Borrowing (the “Proposed Borrowing”)
as required by Section 2.02(a) of the Credit Agreement:

     (i) The Business Day of the Proposed Borrowing is                 , 20            .

     (ii) The Type of Advances to be made in connection with the Proposed Borrowing
is [Base Rate Advances] [Eurodollar Rate Advances].

     (iii) The aggregate amount of the Proposed Borrowing is $                     .

     (iv) The Interest Period for each Advance made as part of the Proposed
Borrowing is [       month[s]].

          The undersigned hereby certifies that the following statements are true on the date
hereof, and will be true on the date of the Proposed Borrowing:

     (A) the representations and warranties of the undersigned contained in Section
4.01 of the Credit Agreement are correct, before and after giving effect to the
Proposed Borrowing and to the application of the proceeds therefrom, as though made
on and as of such date;

B-1

 

     (B) no event has occurred and is continuing, or would result from such Proposed
Borrowing or from the application of the proceeds therefrom, that constitutes an Event of
Default or Unmatured Event of Default; and

     (C) after giving effect to the Proposed Borrowing, the undersigned will not have
exceeded any limitation on its ability to incur indebtedness (including any limitation
imposed by any governmental or regulatory authority).

	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	[EXELON CORPORATION]
	 	 	[PECO ENERGY COMPANY]
	 	 	[EXELON GENERATION COMPANY, LLC]
	 
	 	 	 	 
	 

	 	[By
	 	 ]
	 

	 	 	 	 
	 

	 	 	 	[Name:]
	 

	 	 	 	[Title:]

B-2

 

EXHIBIT C

FORM OF ASSIGNMENT AND ACCEPTANCE

Dated                     ,
20               

          Reference is made to the Credit Agreement dated as of October 28, 2005 among Exelon
Corporation, PECO Energy Company, Exelon Generation Company, LLC (together the “Borrowers”),
various financial institutions and JPMorgan Chase Bank N.A., as Administrative Agent (as amended,
modified or supplemented from time to time, the “Credit Agreement”). Terms defined in the Credit
Agreement are used herein with the same meaning.

                              (the “Assignor”) and                     (the “Assignee”) agree as follows:

          1. The Assignor hereby sells and assigns to the Assignee, and the Assignee hereby purchases
and assumes from the Assignor, that interest in and to all of the Assignor’s rights and obligations
under the Credit Agreement as of the date hereof which represents the Pro Rata Share specified on
Schedule 1 of all outstanding rights and obligations under the Credit Agreement, including, without
limitation, a corresponding interest in the Assignor’s Commitment, the Advances owing to the
Assignor, the Assignor’s interest in Facility LCs and the Notes held by the Assignor. After giving
effect to such sale and assignment, the Assignee’s Commitment Amount will be as set forth in
Section 2 of Schedule 1.

          2. The Assignor (i) represents and warrants that it is the legal and beneficial owner of the
interest being assigned by it hereunder and that such interest is free and clear of any adverse
claim; (ii) makes no representation or warranty and assumes no responsibility with respect to any
statement, warranty or representation made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement or any instrument or document furnished pursuant thereto; and (iii) makes no
representation or warranty and assumes no responsibility with respect to the financial condition of
any Borrower or the performance or observance by any Borrower of any of its obligations under the
Credit Agreement or any other instrument or document furnished pursuant thereto.

          3. The Assignee (i) confirms that it has received a copy of the Credit Agreement, together
with such other documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent, the Lead Arranger, the LC Issuer,
the Assignor or any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is an Eligible Assignee; (iv) appoints and
authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such
powers under the Credit Agreement as are delegated to the Administrative Agent by the terms
thereof, together with such powers as are reasonably incidental thereto; (v) agrees that it will
perform in accordance with their terms all of the obligations which by the terms of the Credit
Agreement are required to be performed by it as a Lender; (vi) confirms that none of the
consideration used to make the purchase being made by the Assignee hereunder are “plan assets” as defined under ERISA; and the rights and
interests of

C-1

 

the Assignee in and under the Credit Agreement will not be “plan assets” under ERISA; [and] (vii)
specifies as its Domestic Lending Office (and address for notices) and Eurodollar Lending Office
the offices set forth beneath its name on the signature pages hereof [;and (viii) attaches the
forms prescribed by the Internal Revenue Service of the United States certifying that it is exempt
from United States withholding taxes with respect to all payments to be made to the Assignee under
the Credit Agreement and the Notes]. 1

          4. Following the execution of this Assignment and Acceptance by the Assignor and the Assignee,
it will be delivered to the Administrative Agent for acceptance by Exelon (if required), the LC
Issuer and the Administrative Agent and recording by the Administrative Agent. The effective date
of this Assignment and Acceptance shall be the date of recording thereof by the Administrative
Agent, unless otherwise specified on Schedule 1 hereto (the “Effective Date”).

          5. Upon such recording by the Administrative Agent, as of the Effective Date, (i) the Assignee
shall be a party to the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder and (ii) the Assignor shall, to
the extent provided in this Assignment and Acceptance, relinquish its rights and be released from
its obligations under the Credit Agreement.

          6. Upon such recording by the Administrative Agent, from and after the Effective Date, the
Administrative Agent shall make all payments under the Credit Agreement and the Notes in respect of
the interest assigned hereby (including, without limitation, all payments of principal, interest
and fees with respect thereto) to the Assignee. The Assignor and Assignee shall make all
appropriate adjustments in payments under the Credit Agreement and the Notes for periods prior to
the Effective Date directly between themselves.

          7. THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE COMMONWEALTH OF PENNSYLVANIA.

 

			
	1	 	If the Assignee is organized under the laws of a jurisdiction outside the United
States.

C-2

 

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

	 	 	 	 	 	 	 
	 

	 	[NAME OF ASSIGNOR]
	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 

	 	[NAME OF ASSIGNOR]
	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	Domestic Lending Office (and
	 	 	address for notices):
	 

	 	 	 	[Address]	 	 
	 
	 	 	 	 	 	 
	 	 	Eurodollar Lending Office:
	 

	 	 	 	[Address]	 	 

C-3

 

[Consented
to
this
            day

of                     , 20___]

EXELON CORPORATION

	 	 	 	 	 
	By
	 	 	 	 
	 

	 	 

  Name:
	 	 
	 

	 	  Title:	 	 

Consented
to and Accepted this
           day

of                     ,
20___

JPMORGAN CHASE BANK, N.A., as Administrative Agent and LC Issuer

By

      Name:

      Title:

C-4

 

Schedule 1

to

Assignment and Acceptance

Dated           ,
20        

	 	 	 	 	 	 	 	 	 
	Section 1.
	 	 	 	 	 	 	 	 
	 	 	          Pro Rata Share:	 	                    %

	Section 2.
	 	 	 	 	 	 	 	 
	 	 	          Assignee’s Commitment Amount after giving effect hereto:	 	 	$	 
	Section 3.
	 	 	 	 	 	 	 	 
	          Effective Date2:	 	           ,
20      	 	 	 	 

 

			
	2	 	This date should be no earlier than the date of recording by the Administrative Agent.

C-5

 

EXHIBIT D — 1

FORM OF OPINION OF BALLARD SPAHR ANDREWS & INGERSOLL

[to be attached]

D-1-1

 

 

EXHIBIT D-2

FORM OF OPINION OF SIDLEY AUSTIN BROWN & WOOD LLP

[to be attached]

D-2-1

 

 

EXHIBIT E

FORM OF ANNUAL AND QUARTERLY COMPLIANCE CERTIFICATE

                                         ,
20____

          Pursuant to the Credit Agreement, dated as of October 28, 2005, among Exelon Corporation
(“Exelon”), PECO Energy Company (“PECO”), Exelon Generation Company, LLC (“Genco”), various
financial institutions and JPMorgan Chase Bank, N.A., as Administrative Agent (as amended, modified
or supplemented from time to time, the “Credit Agreement”), the undersigned, being                     
of [Exelon] [PECO] [Genco] (the “Borrower”), hereby certifies on behalf of
the Borrower as follows:

          1. Delivered herewith are the financial statements prepared pursuant to Section
5.01(b)[(ii)/(iii)] of the Credit Agreement for the
fiscal                     
ended                     ,
20      . All
such financial statements comply with the applicable requirements of the Credit Agreement.

          2. Schedule I hereto sets forth in reasonable detail the information and calculations
necessary to establish the Borrower’s compliance with the provisions of Section 5.02(c) of the
Credit Agreement as of the end of the fiscal period referred to in paragraph 1 above.

          3. (Check one and only one:)

                              
No Event of Default or Unmatured Event of Default has occurred and is continuing.

                              
An Event of Default or Unmatured Event of Default has occurred and is continuing, and
the document(s) attached hereto as Schedule II specify in detail the nature and period of existence
of such Event of Default or Unmatured Event of Default as well as any and all actions with respect
thereto taken or contemplated to be taken by the Borrower.

          4. The undersigned has personally reviewed the Credit Agreement, and this certificate was
based on an examination made by or under the supervision of the undersigned sufficient to assure
that this certificate is accurate.

E-1

 

          5. Capitalized terms used in this certificate and not otherwise defined shall have the
meanings given in the Credit Agreement.

	 	 	 	 	 
	 	 	[EXELON CORPORATION]
	 	 	[PECO ENERGY COMPANY]
	 	 	[EXELON GENERATION COMPANY, LLC]
	 
	 	 	 	 
	 

	 	By	 	 
	 

	 	 	 	 
	 	 	Name:
	 	 	Title:
	 
	 	 	 	 
	Date:
	 	 	 	 

E-2

 

 

EXHIBIT F

FORM OF CONSENT TO BORROWING

                                        ,
20____

          Please refer to the Credit Agreement, dated as of October 28, 2005, among Exelon Corporation,
PECO Energy Company, Exelon Generation Company, LLC, various financial institutions and JPMorgan
Chase Bank, N.A., as Administrative Agent (as amended, modified or supplemented from time to time,
the “Credit Agreement”). Capitalized terms used but not defined herein have the respective
meanings given thereto in the Credit Agreement.

          Pursuant to Section 3.02 of the Credit Agreement, the undersigned [(a)] consents to a
Borrowing in the aggregate amount of $[ ] by [Exelon] [PECO] [Genco] on [date] [and (b) agrees that
such Borrowing may consist of Eurodollar Rate Advances].

          The forgoing consent and agreement shall become effective when the Administrative Agent has
received counterparts hereof signed by all Lenders.

	 	 	 	 	 
	 	 	[Lender]
	 
	 	 	 	 
	 

	 	By 	 	 
	 

	 	 	 
	 	 	Name:
	 	 	Title:

F-1

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