MGE ENERGY INC
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<TYPE>EX-10
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<FILENAME>fq_exh10-1.htm
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<P ALIGN="CENTER"><strong>Exhibit 10.1<br>
  <br>
</strong><strong>CREDIT AGREEMENT<br>
</strong><strong>DATED AS OF JULY 14, 2004<br>
</strong><strong>AMONG</strong></P>

<P ALIGN="CENTER"><strong>MADISON GAS AND ELECTRIC COMPANY,<br>
</strong><strong>THE LENDERS,</strong></P>

<P ALIGN="CENTER"><strong>BANK ONE, NA,<br>
</strong><strong>AS ADMINISTRATIVE AGENT,</strong></P>

<P ALIGN="CENTER"><strong>U.S. BANK NATIONAL ASSOCIATION,<br>
</strong><strong>AS SYNDICATION AGENT,</strong></P>

<P ALIGN="CENTER"><strong>MARSHALL &amp; ILSLEY BANK<br>
</strong><strong>AND<br>
</strong><strong>ASSOCIATED BANK, N.A.,<br>
</strong><strong>AS MANAGING AGENTS</strong></P>

<P ALIGN="CENTER"><strong>AND</strong></P>

<P ALIGN="CENTER"><strong>BANC ONE CAPITAL MARKETS, INC.<br>
</strong><strong>AS LEAD ARRANGER AND SOLE BOOK RUNNER</strong></P>

<P class="style18"><CENTER>
  <strong>ARTICLE I<br>
  </strong><strong>DEFINITIONS</strong>
</CENTER>
</P>

<P class="style20"><CENTER>
  <strong>ARTICLE II</strong>
  <br>
  <strong>THE CREDITS</strong>
</CENTER>
</P>

<P>2.1. The Facility 10<br>
2.2. Advances 11<br>
2.3. Method of Borrowing 12<br>
2.4. Upfront Fee; Facility Fee; Utilization Fee; Reductions in Aggregate Commitment 12<br>
2.5. Minimum Amount of Each Advance 12<br>
2.6. Optional Principal Payments 12<br>
2.7. Changes in Interest Rate, etc 13<br>
2.8. Rates Applicable After Default 13<br>
2.9. Method of Payment 13<br>
2.10. Noteless Agreement; Evidence of Indebtedness 13<br>
2.11. Telephonic Notices 14<br>
2.12. Interest Payment Dates; Interest and Fee Basis 14<br>
2.13. Notification of Advances, Interest Rates, Prepayments and Commitment Reductions 15<br>
2.14. Lending Installations 15<br>
2.15. Non-Receipt of Funds by the Administrative Agent 15<br>
2.16. Extension of Facility Termination Date 15</P>

<P ALIGN="CENTER"><strong>ARTICLE III<br>
</strong><strong>YIELD PROTECTION; TAXES</strong></P>

<P>3.1. Yield Protection 16<br>
3.2. Changes in Capital Adequacy Regulations 17<br>
3.3. Availability of Types of Advances 17<br>
3.4. Funding Indemnification 17<br>
3.5. Taxes 18<br>
3.6. Lender Statements; Survival of Indemnity 19</P>

<P align="center"><strong>ARTICLE IV<br>
</strong><strong>CONDITIONS PRECEDENT</strong></P>

<P>4.1. Initial Advance 20<br>
4.2. Each Advance 21</P>

<P ALIGN="CENTER"><strong>ARTICLE V<br>
</strong><strong>REPRESENTATIONS AND WARRANTIES</strong></P>

<P>5.1. Existence and Standing 22<br>
5.2. Authorization and Validity 22<br>
5.3. No Conflict; Government Consent 22<br>
5.4. Financial Statements 22<br>
5.5. Material Adverse Change 23<br>
5.6. Taxes 23<br>
5.7. Litigation and Contingent Obligations 23<br>
5.8. Subsidiaries 23<br>
5.9. ERISA 23<br>
5.10. Accuracy of Information 23<br>
5.11. Regulation U 24<br>
5.12. Material Agreements 24<br>
5.13. Compliance With Laws 24<br>
5.14. Ownership of Properties 24<br>
5.15. Plan Assets; Prohibited Transactions 24<br>
5.16. Environmental Matters 24<br>
5.17. Investment Company Act 25<br>
5.18. Public Utility Holding Company Act 25<br>
5.19. Insurance 25<br>
5.20. Regulatory Approval 25</P>

<P ALIGN="CENTER"><strong>ARTICLE VI</strong><strong><br>
COVENANTS</strong></P>

<P>6.1. Financial Reporting 25<br>
6.2. Litigation 26<br>
6.3. Use of Proceeds 26<br>
6.4. Notice of Default 27<br>
6.5. Conduct of Business 27<br>
6.6. Taxes 27<br>
6.7. Insurance 27<br>
6.8. Compliance with Laws 27<br>
6.9. Maintenance of Properties 27<br>
6.10. Inspection 27<br>
6.11. Merger 28<br>
6.12. Sale of Assets 28<br>
6.13. Liens 28<br>
6.14. Affiliates 30<br>
6.15. Financial Covenant 30</P>

<P ALIGN="CENTER"><strong>ARTICLE VII<br>
</strong><strong>DEFAULTS</strong></P>

<P ALIGN="CENTER"><strong>ARTICLE VIII<br>
</strong><strong>ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES</strong></P>

<P>8.1. Acceleration 32<br>
8.2. Amendments 32<br>
8.3. Preservation of Rights 33</P>

<P ALIGN="CENTER"><strong>ARTICLE IX<br>
</strong><strong>GENERAL PROVISIONS</strong></P>

<P>9.1. Survival of Representations 33<br>
9.2. Governmental Regulation 33<br>
9.3. Headings 33<br>
9.4. Entire Agreement 33<br>
9.5. Several Obligations; Benefits of this Agreement 34<br>
9.6. Expenses; Indemnification 34<br>
9.7. Numbers of Documents 34<br>
9.8. Accounting 35<br>
9.9. Severability of Provisions 35<br>
9.10. Nonliability of Lenders 35<br>
9.11. Confidentiality 35<br>
9.12. Nonreliance 36<br>
9.13. Disclosure 36</P>

<P ALIGN="CENTER"><strong>ARTICLE X<br>
</strong><strong>THE ADMINISTRATIVE AGENT</strong></P>

<P>10.1. Appointment; Nature of Relationship 36<br>
10.2. Powers 36<br>
10.3. General Immunity 36<br>
10.4. No Responsibility for Loans, Recitals, etc 37<br>
10.5. Action on Instructions of Lenders 37<br>
10.6. Employment of Administrative Agents and Counsel 37<br>
10.7. Reliance on Documents; Counsel 37<br>
10.8. Administrative Agent's Reimbursement and Indemnification 37<br>
10.9. Notice of Default 38<br>
10.10. Rights as a Lender 38<br>
10.11. Lender Credit Decision 38<br>
10.12. Successor Administrative Agent 39<br>
10.13. Administrative Agent and Arranger Fees 40<br>
10.14. Delegation to Affiliates 40</P>

<P ALIGN="CENTER"><strong>ARTICLE XI<br>
</strong><strong>SETOFF; RATABLE PAYMENTS</strong></P>

<P>11.1. Setoff 40<br>
11.2. Ratable Payments 40</P>

<P ALIGN="CENTER"><strong>ARTICLE XII<br>
</strong><strong>BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS</strong></P>

<P>12.1. Successors and Assigns 40<br>
12.2. Participations 41<br>
12.3. Assignments 42<br>
12.4. Dissemination of Information 43<br>
12.5. Tax Treatment 43</P>

<P ALIGN="CENTER"><strong>ARTICLE XIII<br>
</strong><strong>NOTICES</strong></P>

<P>13.1. Notices 43<br>
13.3. Change of Address 44</P>

<P ALIGN="CENTER"><strong>ARTICLE XIV<br>
</strong><strong>COUNTERPARTS; EFFECTIVENESS; TERMINATION OF EXISTING AGREEMENT</strong></P>

<P ALIGN="CENTER"><strong>ARTICLE XV<br>
</strong><strong>CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL</strong></P>

<P>15.1. CHOICE OF LAW 44<br>
15.2. WAIVER OF JURY TRIAL 44</P>

<P><strong>SCHEDULES</strong></P>

<P>Pricing Schedule<br>
Schedule I Existing Credit Agreements</P>

<P><strong>EXHIBITS</strong></P>

<P>EXHIBIT A Form of Opinion of Borrower's Counsel<br>
EXHIBIT B Form of Compliance Certificate<br>
EXHIBIT C Form of Assignment<br>
EXHIBIT D Form of Written Money Transfer Instructions<br>
EXHIBIT E Form of Note</P>

<P><strong>CREDIT AGREEMENT</strong></P>

<P>This Agreement, dated as of July 14, 2004, is among Madison Gas and Electric Company, the
Lenders, and Bank One, NA, a national banking association having its principal office in
Chicago, Illinois, as Administrative Agent, U.S. Bank National Association, as Syndication
Agent, and Marshall &amp; Ilsley Bank and Associated Bank, N.A., as Managing Agents. The parties
hereto agree as follows:</P>

<P ALIGN="CENTER"><strong>ARTICLE I<br>
</strong><strong>DEFINITIONS </strong></P>

<P>As used in this Agreement:</P>

<P>"Administrative Agent" means Bank One in its capacity as contractual representative of the
Lenders pursuant to Article X, and not in its individual capacity as a Lender, and any successor
Administrative Agent appointed pursuant to Article X.</P>

<P>"Advance" means a borrowing hereunder (i) made by the Lenders on the same Borrowing Date,
or (ii) converted or continued by the Lenders on the same date of conversion or continuation,
consisting, in either case, of the aggregate amount of the several Loans of the same Type and, in
the case of Eurodollar Loans, for the same Interest Period.</P>

<P>"Affiliate" of any Person means any other Person directly or indirectly controlling, controlled by
or under common control with such Person. </P>

<P>"Aggregate Commitment" means the aggregate of the Commitments of all the Lenders, in the
initial aggregate amount of $45,000,000 as reduced from time to time pursuant to the terms
hereof.</P>

<P>"Agreement" means this credit agreement, as it may be amended or modified and in effect from
time to time.</P>

<P>"Agreement Accounting Principles" means generally accepted accounting principles as in effect
from time to time, applied in a manner consistent with that used in preparing the financial
statements referred to in Section 5.4.</P>

<P>"Alternate Base Rate" means, for any day, a rate of interest per annum equal to the higher of (i)
the Prime Rate for such day and (ii) the sum of the Federal Funds Effective Rate for such day
plus 1/2% per annum.</P>

<P>"Applicable Fee Rate" means, at any time, the percentage rate per annum at which Facility Fees
are accruing on the Aggregate Commitment (without regard to usage) at such time as set forth in
the Pricing Schedule.</P>

<P>"Applicable Margin" means, with respect to Advances of any Type at any time, the percentage
rate per annum which is applicable at such time with respect to Advances of such Type as set
forth in the Pricing Schedule.</P>

<P>"Arranger" means Banc One Capital Markets, Inc., a Delaware corporation, and its successors, in
its capacity as Lead Arranger and Sole Book Runner.</P>

<P>"Article" means an article of this Agreement unless another document is specifically referenced.</P>

<P>"Authorized Officer" means any of the Chairman, President, Chief Financial Officer, Treasurer
or an Assistant Treasurer of the Borrower, acting singly.</P>

<P>"Bank One" means Bank One, NA, a national banking association having its principal office in
Chicago, Illinois, in its individual capacity, and its successors.</P>

<P>"Bankruptcy Code" means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C. &sect;101 et seq.).</P>

<P>"Borrower" means Madison Gas and Electric Company, a Wisconsin corporation, and its
successors and assigns.</P>

<P>"Borrowing Date" means a date on which an Advance is made hereunder.</P>

<P>"Borrowing Notice" is defined in Section 2.2.3.</P>

<P>"Business Day" means (i) with respect to any borrowing, payment or rate selection of Eurodollar
Advances, a day (other than a Saturday or Sunday) on which banks generally are open in Chicago
and New York for the conduct of substantially all of their commercial lending activities,
interbank wire transfers can be made on the Fedwire system and dealings in United States dollars
are carried on in the London interbank market and (ii) for all other purposes, a day (other than a
Saturday or Sunday) on which banks generally are open in Chicago for the conduct of
substantially all of their commercial lending activities and interbank wire transfers can be made
on the Fedwire system.</P>

<P>"Capitalized Lease" of a Person means any lease of Property by such Person as lessee which
would be capitalized on a balance sheet of such Person prepared in accordance with Agreement
Accounting Principles.</P>

<P>"Capitalized Lease Obligations" of a Person means the amount of the obligations of such Person
under Capitalized Leases which would be shown as a liability on a balance sheet of such Person
prepared in accordance with Agreement Accounting Principles.</P>

<P>"Cash Equivalent Investments" means (i) short-term obligations of, or fully guaranteed by, the
United States of America, (ii) commercial paper rated A-1 or better by S&amp;P or P-1 or better by
Moody's, (iii) demand deposit accounts maintained in the ordinary course of business, and (iv)
certificates of deposit issued by and time deposits with commercial banks (whether domestic or
foreign) having capital and surplus in excess of $100,000,000; provided in each case that the
same provides for payment of both principal and interest (and not principal alone or interest
alone) and is not subject to any contingency regarding the payment of principal or interest.</P>

<P>"CERCLA" means the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended from time to time.</P>

<P>"CERCLIS" means the Comprehensive Environmental Response Compensation Liability
Information System List, as amended from time to time.</P>

<P>"Change in Control" means the acquisition by any Person, or two or more Persons acting in
concert, of beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934) of 30% or more of the
outstanding shares of voting stock of the Borrower.</P>

<P>"Code" means the Internal Revenue Code of 1986, as amended, reformed or otherwise modified
from time to time.</P>

<P>"Commitment" means, for each Lender, the obligation of such Lender to make Loans not
exceeding the amount set forth opposite its signature below, as it may be modified as a result of
any assignment that has become effective pursuant to Section 12.3.2 or as otherwise modified
from time to time pursuant to the terms hereof.</P>

<P>"Consolidated Indebtedness" means at any time the Indebtedness of the Borrower and its
Subsidiaries calculated on a consolidated basis as of such time.</P>

<P>"Consolidated Net Worth" means at any time the consolidated stockholder's equity of the
Borrower and its Subsidiaries calculated on a consolidated basis as of such time.</P>

<P>"Consolidated Total Capitalization" means at any time the sum of Consolidated Indebtedness and
Consolidated Net Worth, each calculated at such time.</P>

<P>"Contingent Obligation" of a Person means any agreement, undertaking or arrangement by which
such Person assumes, guarantees, endorses, contingently agrees to purchase or provide funds for
the payment of, or otherwise becomes or is contingently liable upon, the Indebtedness of any
other Person, or agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person against loss,
including, without limitation, any comfort letter, operating agreement, take-or-pay contract or the
obligations of any such Person as general partner of a partnership with respect to the liabilities of
the partnership.</P>

<P>"Controlled Group" means all members of a controlled group of corporations or other business
entities and all members of a controlled group of trades or businesses (whether or not
incorporated) under common control which, together with the Borrower, are treated as a single
employer under Section 414 of the Code or Section 4001 of ERISA.</P>

<P>"Conversion/Continuation Notice" is defined in Section 2.2.4.</P>

<P>"Default" means an event described in Article VII.</P>

<P>"Environmental Laws" means any and all federal, state, local and foreign statutes, laws, judicial
decisions, regulations, ordinances, rules, judgments, orders, decrees, plans, injunctions, permits,
concessions, grants, franchises, licenses, agreements and other governmental restrictions relating
to (i) the protection of the environment, (ii) the effect of the environment on human health, (iii)
emissions, discharges or releases of pollutants, contaminants, hazardous substances or wastes
into surface water, ground water or land, or (iv) the manufacture, processing, distribution, use,
treatment, storage, disposal, transport or handling of pollutants, contaminants, hazardous
substances or wastes or the clean-up or other remediation thereof.</P>

<P>"ERISA" means the Employee Retirement Income Security Act of 1974, as amended from time
to time, and any rule or regulation issued thereunder.</P>

<P>"Eurodollar Advance" means an Advance which bears interest at a Eurodollar Rate requested by
the Borrower pursuant to Section 2.2.</P>

<P>"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for the relevant Interest
Period, the applicable British Bankers' Association Interest Settlement Rate for deposits in U.S.
dollars appearing on Reuters Screen FRBD as of 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period, and having a maturity equal to such Interest Period,
provided that, (i) if Reuters Screen FRBD is not available to the Administrative Agent for any
reason, the applicable Eurodollar Base Rate for the relevant Interest Period shall instead be the
applicable British Bankers' Association Interest Settlement Rate for deposits in U.S. dollars as
reported by any other 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, and having a
maturity equal to such Interest Period, and (ii) if no such British Bankers' Association Interest
Settlement Rate is available to the Administrative Agent, the applicable Eurodollar Base Rate for
the relevant Interest Period shall instead be the rate determined by the Administrative Agent to be
the rate at which Bank One 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
Bank One's relevant Eurodollar Loan and having a maturity equal to such Interest Period.</P>

<P>"Eurodollar Loan" means a Loan which bears interest at a Eurodollar Rate requested by the
Borrower pursuant to Section 2.2.</P>

<P>"Eurodollar Rate" means, with respect to a Eurodollar Advance for the relevant Interest Period,
the sum of (i) the quotient of (a) the Eurodollar Base Rate applicable to such Interest Period,
divided by (b) one minus the Reserve Requirement (expressed as a decimal) applicable to such
Interest Period, plus (ii) the Applicable Margin.</P>

<P>"Excluded Taxes" means, in the case of each Lender or applicable Lending Installation and the
Administrative Agent, taxes imposed on its overall net income, and franchise taxes imposed on
it, by (i) the jurisdiction under the laws of which such Lender or the Administrative Agent is
incorporated or organized or (ii) the jurisdiction in which the Administrative Agent's or such
Lender's principal executive office or such Lender's applicable Lending Installation is located.</P>

<P>"Exhibit" refers to an exhibit to this Agreement, unless another document is specifically
referenced.</P>

<P>"Existing Credit Agreements" means the existing bilateral credit agreements of the Borrower
listed on Schedule I attached hereto.</P>

<P>"Extension Request" is defined in Section 2.16.</P>

<P>"Facility Termination Date" means July 14, 2007 or any later date as may be specified as the
Facility Termination Date in accordance with Section 2.16 or any earlier date on which the
Aggregate Commitment is reduced to zero or otherwise terminated pursuant to the terms hereof.</P>

<P>"Federal Funds Effective Rate" means, for any day, an interest rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as published for such
day (or, if such day is not a Business Day, for the immediately 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 at approximately 10:00 a.m. (Chicago time) on such
day on such transactions received by the Administrative Agent from three Federal funds brokers
of recognized standing selected by the Administrative Agent in its sole discretion.</P>

<P>"Floating Rate" means, for any day, a rate per annum equal to the Alternate Base Rate for such
day, in each case changing when and as the Alternate Base Rate changes.</P>

<P>"Floating Rate Advance" means an Advance which, except as otherwise provided in Section 2.8,
bears interest at the Floating Rate.</P>

<P>"Floating Rate Loan" means a Loan which, except as otherwise provided in Section 2.8, bears
interest at the Floating Rate.</P>

<P>"Fund" means any Person (other than a natural person) that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar extensions of credit
in the ordinary course of its business.</P>

<P>"GAAP" means generally accepted accounting principles as in effect from time to time in the
United States, applied in a manner consistent with that used in preparing the financial statements
referred to in Section 5.4.</P>

<P>"Indebtedness" of a Person means, without duplication, such Person's (i) obligations for
borrowed money, (ii) obligations representing the deferred purchase price of Property or services
(other than accounts payable arising in the ordinary course of such Person's business payable on
terms customary in the trade), (iii) obligations for borrowed money or for the deferred purchase
price of Property or services, whether or not assumed, secured by Liens or payable out of the
proceeds or production from Property now or hereafter owned or acquired by such Person, (iv)
obligations which are evidenced by notes, acceptances, or other instruments, (v) obligations of
such Person to purchase securities or other Property arising out of or in connection with the sale
of the same or substantially similar securities or Property, (vi) Capitalized Lease Obligations,
(vii) any other obligation for borrowed money or other financial accommodation which in
accordance with Agreement Accounting Principles would be shown as a liability on the
consolidated balance sheet of such Person, (viii) Contingent Obligations in respect of any type of
obligation described in any of the other clauses of this definition, (ix) obligations in respect of
Letters of Credit (other than obligations in respect of Letters of Credit supporting timely
construction payments under a generation/transmission agreement with American Transmission
Company, LLC or under similar agreements with American Transmission Company, LLC or
other parties), (x) obligations in respect of Sale and Leaseback Transactions and (xi) Off-Balance
Sheet Liabilities.</P>

<P>"Interest Period" means, with respect to a Eurodollar Advance, a period of one, two, three or six
months commencing on a Business Day selected by the Borrower pursuant to this Agreement.
Such Interest Period shall end on the day which corresponds numerically to such date one, two,
three or six months thereafter, provided, however, that if there is no such numerically
corresponding day in such next, second, third or sixth succeeding month, such Interest Period
shall end on the last Business Day of such next, second, third or sixth succeeding month. If a
Interest Period would otherwise end on a day which is not a Business Day, such Interest Period
shall end on the next succeeding Business Day, provided, however, that if said next succeeding
Business Day falls in a new calendar month, such Interest Period shall end on the immediately
preceding Business Day.</P>

<P>"Lenders" means the lending institutions listed on the signature pages of this Agreement and their
respective successors and assigns.</P>

<P>"Lending Installation" means, with respect to a Lender or the Administrative Agent, the office,
branch, subsidiary or affiliate of such Lender or the Administrative Agent listed on the signature
pages hereof or on a Schedule or otherwise selected by such Lender or the Administrative Agent
pursuant to Section 2.14.</P>

<P>"Letter of Credit" of a Person means a letter of credit or similar instrument which is issued upon
the application of such Person or upon which such Person is an account party or for which such
Person is in any way liable.</P>

<P>"Lien" means any lien (statutory or other), mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, the interest of a
vendor or lessor under any conditional sale, Capitalized Lease or other title retention agreement).</P>

<P>"Loan" means, with respect to a Lender, such Lender's loan made pursuant to Article II (or, in the
case of a loan made pursuant to Section 2.2, any conversion or continuation thereof).</P>

<P>"Loan Documents" means this Agreement and any Notes issued pursuant to Section 2.10.</P>

<P>"Material Adverse Effect" means a material adverse effect on the business, condition (financial
or otherwise), operations, performance or properties of the Borrower and its Subsidiaries, taken
as a whole, on the ability of the Borrower to perform its obligations under this Agreement, or on
the validity or enforceability of this Agreement.</P>

<P>"Moody's" means Moody's Investors Service, Inc.</P>

<P>"Multiemployer Plan" means a Plan maintained pursuant to a collective bargaining agreement or
any other arrangement to which the Borrower or any member of the Controlled Group is a party
to which more than one employer is obligated to make contributions.</P>

<P>"Non-U.S. Lender" is defined in Section 3.5(iv).</P>

<P>"Note" means any promissory note issued at the request of a Lender pursuant to Section 2.10 to
evidence its Loans in the form of Exhibit E hereto.</P>

<P>"Obligations" means all unpaid principal of and accrued and unpaid interest on the Loans, all
accrued and unpaid fees and all expenses, reimbursements, indemnities and other obligations of
the Borrower to the Lenders or to any Lender, the Administrative Agent or any indemnified party
arising under the Loan Documents.</P>

<P>"Off-Balance Sheet Liability" of a Person means (i) any repurchase obligation or liability of such
Person with respect to accounts or notes receivable sold by such Person, (ii) any liability under
any Sale and Leaseback Transaction which is not a Capitalized Lease, (iii) any liability under any
so-called "synthetic lease" transaction entered into by such Person, or (iv) any obligation arising
with respect to any other transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheets of such Person, but
excluding from this clause (iv) Operating Leases.</P>

<P>"Operating Lease" of a Person means any lease of Property (other than a Capitalized Lease) by
such Person as lessee which has an original term (including any required renewals and any
renewals effective at the option of the lessor) of one year or more.</P>

<P>"Operating Lease Obligations" means, as at any date of determination, the amount obtained by
aggregating the present values, determined in the case of each particular Operating Lease by
applying a discount rate (which discount rate shall equal the discount rate which would be
applied under Agreement Accounting Principles if such Operating Lease were a Capitalized
Lease) from the date on which each fixed lease payment is due under such Operating Lease to
such date of determination, of all fixed lease payments due under all Operating Leases of the
Borrower and its Subsidiaries.</P>

<P>"Other Taxes" is defined in Section 3.5(ii).</P>

<P>"Participants" is defined in Section 12.2.1.</P>

<P>"Payment Date" means the last day of each month.</P>

<P>"PBGC" means the Pension Benefit Guaranty Corporation, or any successor thereto.</P>

<P>"Pension Plan" means a "pension plan", as such term is defined in section 3(2) of ERISA, which
is subject to Title IV of ERISA, and to which the Borrower or any corporation, trade or business
that is, along with the Borrower, a member of a Controlled Group, may have liability, including
any liability by reason of having been a substantial employer within the meaning of section 4063
of ERISA at any time during the preceding five years, or by reason of being deemed to be a
contributing sponsor under section 4069 of ERISA.</P>

<P>"Person" means any natural person, corporation, firm, joint venture, partnership, limited liability
company, association, enterprise, trust or other entity or organization, or any government or
political subdivision or any agency, department or instrumentality thereof.</P>

<P>"Pricing Schedule" means the Schedule attached hereto identified as such.</P>

<P>"Prime Rate" means a rate per annum equal to the prime rate of interest announced from time to
time by Bank One or its parent (which is not necessarily the lowest rate charged to any
customer), changing when and as said prime rate changes.</P>

<P>"Principal Subsidiary" means any Subsidiary (i) which together with its Subsidiaries has assets
having an aggregate book value exceeding 10% of the consolidated assets of the Borrower and its
Subsidiaries, or (ii) which together with its Subsidiaries had net income in excess of 10% of the
consolidated net income of the Borrower and its Subsidiaries for the most recently ended period
of four fiscal quarters.</P>

<P>"Property" of a Person means any and all property, whether real, personal, tangible, intangible, or
mixed, of such Person, or other assets owned, leased or operated by such Person.</P>

<P>"Purchasers" is defined in Section 12.3.1.</P>

<P>"Regulation D" means Regulation D of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor thereto or other regulation or official interpretation
of said Board of Governors relating to reserve requirements applicable to member banks of the
Federal Reserve System.</P>

<P>"Regulation U" means Regulation U of the Board of Governors of the Federal Reserve System as
from time to time in effect and any successor or other regulation or official interpretation of said
Board of Governors relating to the extension of credit by banks for the purpose of purchasing or
carrying margin stocks applicable to member banks of the Federal Reserve System.</P>

<P>"Reportable Event" means a reportable event as defined in Section 4043 of ERISA and the
regulations issued under such section, with respect to a Plan, excluding, however, such events as
to which the PBGC has 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, however, that a failure to
meet the minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the notice
requirement in accordance with either Section 4043(a) of ERISA or Section 412(d) of the Code.</P>

<P>"Reports" is defined in Section 9.6.</P>

<P>"Required Lenders" means Lenders in the aggregate having at least 66-2/3% of the Aggregate
Commitment or, if the Aggregate Commitment has been terminated, Lenders in the aggregate
holding at least 66-2/3% of the aggregate unpaid principal amount of the outstanding Advances.</P>

<P>"Reserve Requirement" means, with respect to an Interest Period, the maximum aggregate
reserve requirement (including all basic, supplemental, marginal and other reserves) which is
imposed under Regulation D on Eurocurrency liabilities.</P>

<P>"Resource Conservation and Recovery Act" means the Resource Conservation and Recovery Act,
42 U.S.C. Section 690, et seq., as amended from time to time.</P>

<P>"Response Date" is defined in Section 2.16.</P>

<P>"S&amp;P" means Standard and Poor's Ratings Services, a division of The McGraw Hill Companies,
Inc.</P>

<P>"Sale and Leaseback Transaction" means any sale or other transfer of Property by any Person
with the intent to lease such Property as lessee.</P>

<P>"Schedule" refers to a specific schedule to this Agreement, unless another document is
specifically referenced.</P>

<P>"SEC" means the Securities and Exchange Commission.</P>

<P>"Section" means a numbered section of this Agreement, unless another document is specifically
referenced.</P>

<P>"Single Employer Plan" means a Plan maintained by the Borrower or any member of the
Controlled Group for employees of the Borrower or any member of the Controlled Group.</P>

<P>"Subsidiary" of a Person means (i) any corporation more than 50% of the outstanding securities
having ordinary voting power of which shall at the time be owned or controlled, directly or
indirectly, by such Person or by one or more of its Subsidiaries or by such Person and one or
more of its Subsidiaries, or (ii) any partnership, limited liability company, association, joint
venture or similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled. Unless otherwise
expressly provided, all references herein to a "Subsidiary" shall mean a Subsidiary of the
Borrower.</P>

<P>"Substantial Portion" means, with respect to the Property of the Borrower and its Subsidiaries,
Property which represents more than 10% of the consolidated assets of the Borrower and its
Subsidiaries or property which is responsible for more than 10% of the consolidated net sales or
of the consolidated net income of the Borrower and its Subsidiaries, in each case, as would be
shown in the consolidated financial statements of the Borrower and its Subsidiaries as at the
beginning of the twelve-month period ending with the month in which such determination is
made (or if financial statements have not been delivered hereunder for that month which begins
the twelve-month period, then the financial statements delivered hereunder for the quarter ending
immediately prior to that month).</P>

<P>"Taxes" means any and all present or future taxes, duties, levies, imposts, deductions, charges or
withholdings, and any and all liabilities with respect to the foregoing, but excluding Excluded
Taxes and Other Taxes.</P>

<P>"Transferee" is defined in Section 12.4.</P>

<P>"Type" means, with respect to any Advance, its nature as a Floating Rate Advance or a
Eurodollar Advance.</P>

<P>"Unmatured Default" means an event which but for the lapse of time or the giving of notice, or
both, would constitute a Default.</P>

<P>"Welfare Plan" means a "welfare plan", as such term is defined in section 3(1) of ERISA.</P>

<P>"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the outstanding voting
securities of which shall at the time be owned or controlled, directly or indirectly, by such Person
or one or more Wholly-Owned Subsidiaries of such Person, or by such Person and one or more
Wholly-Owned Subsidiaries of such Person, or (ii) any partnership, limited liability company,
association, joint venture or similar business organization 100% of the ownership interests
having ordinary voting power of which shall at the time be so owned or controlled.</P>

<P>The foregoing definitions shall be equally applicable to both the singular and plural forms of the
defined terms.</P>

<P ALIGN="CENTER"><strong>ARTICLE II<br>
</strong><strong>THE CREDITS </strong></P>

<P>2.1 The Facility. </P>

<P>2.1.1. Description of Facility. The Lenders grant to the Borrower a revolving credit facility
pursuant to which, and upon the terms and subject to the conditions herein set forth, each Lender
severally agrees to make Loans to the Borrower in accordance with Section 2.2. </P>

<P>2.1.2. Amount of Facility. In no event may the aggregate principal amount of all outstanding
Advances exceed the Aggregate Commitment. </P>

<P>2.1.3. Availability of Facility. Subject to the terms of this Agreement, the facility is available
from the date hereof to the Facility Termination Date, and the Borrower may borrow, repay and
reborrow at any time prior to the Facility Termination Date. The Commitments to lend hereunder
shall expire on the Facility Termination Date. </P>

<P>2.1.4. Mandatory Prepayment. The Borrower shall pay or prepay for the ratable account of the
Lenders the aggregate principal amount outstanding hereunder such that, for a period of at least
one day during any 364-day period, the principal amount outstanding hereunder shall be zero. </P>

<P>2.1.5. Repayment of Facility. Any outstanding Advances and all other unpaid Obligations shall
be paid in full by the Borrower on the Facility Termination Date. </P>

<P>2.2 Advances. </P>

<P>2.2.1. Advances. Each Advance hereunder shall consist of Loans made from the several Lenders
ratably in proportion to the ratio that their respective Commitments bear to the Aggregate
Commitment. </P>

<P>2.2.2. Types of Advances. The Advances may be Floating Rate Advances or Eurodollar
Advances, or a combination thereof, selected by the Borrower in accordance with Section 2.2.3. </P>

<P>2.2.3. Method of Selecting Types and Interest Periods for Advances. The Borrower shall select
the Type of Advance and, in the case of each Eurodollar Advance, the Interest Period applicable
thereto, from time to time. The Borrower shall give the Administrative Agent irrevocable notice
(a "Borrowing Notice") not later than 10:00 a.m. (Chicago time) on the Borrowing Date of each
Floating Rate Advance and at least three Business Days before the Borrowing Date for each
Eurodollar Advance. A Borrowing Notice shall specify: </P>

<P>(i) the Borrowing Date, which shall be a Business Day, of such Advance, </P>

<P>(ii) the aggregate amount of such Advance, </P>

<P>(iii) the Type of Advance selected, and </P>

<P>(iv) in the case of each Eurodollar Advance, the Interest Period applicable thereto (which may not
end after the Facility Termination Date). </P>

<P>2.2.4. Conversion and Continuation of Outstanding Advances. Floating Rate Advances shall
continue as Floating Rate Advances unless and until such Floating Rate Advances are either
converted into Eurodollar Advances in accordance with this Section 2.2.4 or are repaid in
accordance with Section 2.7. Each Eurodollar Advance shall continue as a Eurodollar Advance
until the end of the then applicable Interest Period therefor, at which time such Eurodollar
Advance shall be automatically converted into a Floating Rate Advance unless (x) such
Eurodollar Advance is or was repaid in accordance with Section 2.6 or (y) the Borrower shall
have given the Administrative Agent a Conversion/Continuation Notice (as defined below)
requesting that, at the end of such Interest Period, such Eurodollar Advance continue as a
Eurodollar Advance for the same or another Interest Period. Subject to the terms of Section 2.5,
the Borrower may elect from time to time to convert all or any part of a Floating Rate Advance
into a Eurodollar Advance. The Borrower shall give the Administrative Agent irrevocable notice
(a "Conversion/Continuation Notice") of each conversion of a Floating Rate Advance into a
Eurodollar Advance, or continuation of a Eurodollar Advance, not later than 10:00 a.m. (Chicago
time) at least three Business Days prior to the date of the requested conversion or continuation,
specifying: </P>

<P>(i) the requested date, which shall be a Business Day, of such conversion or continuation, </P>

<P>(ii) the aggregate amount and Type of the Advance which is to be converted or continued, and </P>

<P>(iii) the amount of such Advance(s) which is to be converted or continued as a Eurodollar
Advance and the duration of the Interest Period applicable thereto. </P>

<P>2.3. Method of Borrowing. Not later than noon (Chicago time) on each Borrowing Date, each
Lender shall make available its Loan or Loans in funds immediately available in Chicago to the
Administrative Agent at its address specified pursuant to Article XIII. The Administrative Agent
will make the funds so received from the Lenders available to the Borrower at the Administrative
Agent's aforesaid address. </P>

<P>2.4. Upfront Fee; Facility Fee; Utilization Fee; Reductions in Aggregate Commitment. The
Borrower agrees to pay to the Administrative Agent for the account of each Lender on the date
hereof an upfront fee equal to 0.10% of such Lender's Commitment. The Borrower agrees to pay
to the Administrative Agent for the account of each Lender a facility fee at a per annum rate
equal to the Applicable Fee Rate on the average daily amount of such Lender's Commitment
(whether used or unused) from the date hereof to and including the Facility Termination Date,
payable on the last day of each calendar quarter hereafter and on the Facility Termination Date.
The Borrower agrees to pay to the Administrative Agent for the account of each Lender a
utilization fee of 0.15% per annum on the outstanding principal amount of such Lender's Loans
for each day on which the aggregate outstanding amount of the Loans of all Lenders exceeds
50% of the Aggregate Commitment, payable on the last day of each calendar quarter hereafter
and on the Facility Termination Date. The Borrower may permanently reduce the Aggregate
Commitment in whole, or in part ratably among the Lenders in an amount equal to $5,000,000 or
an integral multiple of $1,000,000 in excess of $5,000,000 upon at least three Business Days'
written notice to the Administrative Agent, which notice shall specify the amount of any such
reduction, provided, however, that the amount of the Aggregate Commitment may not be reduced
below the aggregate principal amount of the outstanding Advances. All accrued facility fees and
utilization fees shall be payable on the effective date of any termination of the obligations of the
Lenders to make Loans hereunder. </P>

<P>2.5. Minimum Amount of Each Advance. Each Eurodollar Advance shall be in the minimum
amount of $1,000,000 (and in multiples of $500,000 if in excess thereof), and each Floating Rate
Advance shall be in the minimum amount of (i) $1,000,000 (and in multiples of $500,000 if in
excess thereof) or (ii) the amount of then outstanding commercial paper being repaid with the
proceeds of such Floating Rate Advance, provided, however, that any Floating Rate Advance
may be in the amount of the unused Aggregate Commitment. The Borrower shall not request a
Eurodollar Advance if, after giving effect to the requested Eurodollar Advance, more than five
separate Eurodollar Advances would be outstanding. </P>

<P>2.6. Optional Principal Payments. The Borrower may from time to time pay on any Business
Day, without penalty or premium, all outstanding Floating Rate Advances, or, in a minimum
aggregate amount of $1,000,000 or any integral multiple of $500,000 in excess thereof, any
portion of the outstanding Floating Rate Advances upon notice to the Administrative Agent (not
later than 10:00 a.m. (Chicago time) on the proposed day of payment. The Borrower may from
time to time pay, subject to the payment of any funding indemnification amounts required by
Section 3.4 but without penalty or premium, all outstanding Eurodollar Advances or, in a
minimum aggregate amount of $1,000,000 or any integral multiple of $500,000 in excess thereof,
any portion of the outstanding Eurodollar Advances upon three Business Days' prior notice to the
Administrative Agent. </P>

<P>2.7. Changes in Interest Rate, etc. Each Floating Rate Advance shall bear interest on the
outstanding principal amount thereof, for each day from and including the date such Advance is
made or is converted from a Eurodollar Advance into a Floating Rate Advance pursuant to
Section 2.2.4 to but excluding the date it becomes due or is converted into a Eurodollar Advance
pursuant to Section 2.2.4 hereof, at a rate per annum equal to the Floating Rate for such day.
Changes in the rate of interest on that portion of any Advance maintained as a Floating Rate
Advance will take effect simultaneously with each change in the Alternate Base Rate. Each
Eurodollar Advance shall bear interest on the outstanding principal amount thereof from and
including the first day of the Interest Period applicable thereto to (but not including) the last day
of such Interest Period at the interest rate determined as applicable to such Eurodollar Advance.
No Interest Period may end after the Facility Termination Date. </P>

<P>2.8. Rates Applicable After Default. Notwithstanding anything to the contrary contained in
Section 2.2.3 or Section 2.2.4, during the continuance of a Default or Unmatured Default the
Required Lenders may, at their option, by notice to the Borrower (which notice may be revoked
at the option of the Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that no Advance may be
made as, converted into or continued as a Eurodollar Advance. During the continuance of a
Default the Required Lenders may, at their option, by notice to the Borrower (which notice may
be revoked at the option of the Required Lenders notwithstanding any provision of Section 8.2
requiring unanimous consent of the Lenders to changes in interest rates), declare that (i) each
Eurodollar Advance shall bear interest for the remainder of the applicable Interest Period at the
rate otherwise applicable to such Interest Period plus 2% per annum and (ii) each Floating Rate
Advance shall bear interest at a rate per annum equal to the Floating Rate otherwise applicable to
the Floating Rate Advance plus 2% per annum, provided that, during the continuance of a
Default under Section 7.7 or 7.8, the interest rates set forth in clauses (i) and (ii) above shall be
applicable to all Advances without any election or action on the part of the Administrative Agent
or any Lender. </P>

<P>2.9. Method of Payment. All payments of the Obligations hereunder shall be made, without
setoff, deduction, or counterclaim, in immediately available funds to the Administrative Agent at
the Administrative Agent's address specified pursuant to Article XIII, or at any other Lending
Installation of the Administrative Agent specified in writing by the Administrative Agent to the
Borrower, by noon (local time) on the date when due and shall be applied ratably by the
Administrative Agent among the Lenders. Each payment delivered to the Administrative Agent
for the account of any Lender shall be delivered promptly by the Administrative Agent to such
Lender in the same type of funds that the Administrative Agent received at its address specified
pursuant to Article XIII or at any Lending Installation specified in a notice received by the
Administrative Agent from such Lender. The Administrative Agent is hereby authorized to
charge the account of the Borrower maintained with Bank One for each payment of principal,
interest and fees as it becomes due hereunder. </P>

<P>2.10. Noteless Agreement; Evidence of Indebtedness. (i) Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the indebtedness of the
Borrower to such Lender resulting from each Loan made by such Lender from time to time,
including the amounts of principal and interest payable and paid to such Lender from time to
time hereunder. </P>

<P>(ii) The Administrative Agent shall also maintain accounts in which it will record (a) the amount
of each Loan made hereunder, the Type thereof and the Interest Period with respect thereto, (b)
the amount of any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (c) the amount of any sum received by the
Administrative Agent hereunder from the Borrower and each Lender's share thereof. </P>

<P>(iii) The entries maintained in the accounts maintained pursuant to paragraphs (i) and (ii) above
shall be prima facie evidence of the existence and amounts of the Obligations therein recorded;
provided, however, that the failure of the Administrative Agent or any Lender to maintain such
accounts or any error therein shall not in any manner affect the obligation of the Borrower to
repay the Obligations in accordance with their terms. </P>

<P>(iv) Any Lender may request that its Loans be evidenced by Notes. In such event, the Borrower
shall prepare, execute and deliver to such Lender a Note payable to the order of such Lender.
Thereafter, the Loans evidenced by such Note and interest thereon shall at all times (including
after any assignment pursuant to Section 12.3) be represented by a Note payable to the order of
the payee named therein or any assignee pursuant to Section 12.3, except to the extent that any
such Lender or assignee subsequently returns any such Note for cancellation and requests that
such Loans once again be evidenced as described in paragraphs (i) and (ii) above. </P>

<P>2.11. Telephonic Notices. The Borrower hereby authorizes the Lenders and the Administrative
Agent to extend, convert or continue Advances, effect selections of Types of Advances, and to
transfer funds based on telephonic notices made by any person or persons the Administrative
Agent or any Lender in good faith believes to be acting on behalf of the Borrower, it being
understood that the foregoing authorization is specifically intended to allow Borrowing Notices
and Conversion/Continuation Notices to be given telephonically. The Borrower agrees to deliver
promptly to the Administrative Agent a written confirmation, if such confirmation is requested
by the Administrative Agent or any Lender, of each telephonic notice signed by an Authorized
Officer. If the written confirmation differs in any material respect from the action taken by the
Administrative Agent and the Lenders, the records of the Administrative Agent and the Lenders
shall govern absent manifest error. </P>

<P>2.12. Interest Payment Dates; Interest and Fee Basis. Interest accrued on each Floating Rate
Advance shall be payable on each Payment Date, commencing with the first such date to occur
after the date hereof, on any date on which the Floating Rate Advance is prepaid, whether due to
acceleration or otherwise, and at maturity. Interest accrued on that portion of the outstanding
principal amount of any Floating Rate Advance converted into a Eurodollar Advance on a day
other than a Payment Date shall be payable on the date of conversion. Interest accrued on each
Eurodollar Advance shall be payable on the last day of its applicable Interest Period, on any date
on which the Eurodollar Advance is prepaid, whether by acceleration or otherwise, and at
maturity. Interest accrued on each Eurodollar Advance having an Interest Period longer than
three months shall also be payable on the last day of each three-month interval during such
Interest Period. Interest, facility fees and utilization fees shall be calculated for actual days
elapsed on the basis of a 360-day year, except that interest calculated based on the Prime Rate
shall be calculated for actual days elapsed on the basis of a 365, or when appropriate 366, day
year. Interest shall be payable for the day an Advance is made but not for the day of any payment
on the amount paid if payment is received prior to noon (local time) at the place of payment. If
any payment of principal of or interest on an Advance shall become due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day and, in the case
of a principal payment, such extension of time shall be included in computing interest in
connection with such payment. </P>

<P>2.13. Notification of Advances, Interest Rates, Prepayments and Commitment Reductions.
Promptly after receipt thereof, the Administrative Agent will notify each Lender of the contents
of each Aggregate Commitment reduction notice, Borrowing Notice, Conversion/Continuation
Notice, and repayment notice received by it hereunder. The Administrative Agent will notify
each Lender of the interest rate applicable to each Eurodollar Advance promptly upon
determination of such interest rate and will give each Lender prompt notice of each change in the
Alternate Base Rate. </P>

<P>2.14. Lending Installations. Each Lender may book its Loans at any Lending Installation selected
by such Lender and may change its Lending Installation from time to time. All terms of this
Agreement shall apply to any such Lending Installation and any Notes issued hereunder shall be
deemed held by each Lender for the benefit of any such Lending Installation. Each Lender may,
by written notice to the Administrative Agent and the Borrower in accordance with Article XIII,
designate replacement or additional Lending Installations through which Loans will be made by
it and for whose account Loan payments are to be made. </P>

<P>2.15. Non-Receipt of Funds by the Administrative Agent. Unless the Borrower or a Lender, as
the case may be, notifies the Administrative Agent prior to the date on which it is scheduled to
make payment to the Administrative Agent of (i) in the case of a Lender, the proceeds of a Loan
or (ii) in the case of the Borrower, a payment of principal, interest or fees to the Administrative
Agent for the account of the Lenders, that it does not intend to make such payment, the
Administrative Agent may assume that such payment has been made. The Administrative Agent
may, but shall not be obligated to, make the amount of such payment available to the intended
recipient in reliance upon such assumption. If such Lender or the Borrower, as the case may be,
has not in fact made such payment to the Administrative Agent, the recipient of such payment
shall, on demand by the Administrative Agent, repay to the Administrative Agent the amount so
made available together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the Administrative Agent until
the date the Administrative Agent recovers such amount at a rate per annum equal to (x) in the
case of payment by a Lender, the Federal Funds Effective Rate for such day for the first three
days and, thereafter, the interest rate applicable to the relevant Loan or (y) in the case of payment
by the Borrower, the interest rate applicable to the relevant Loan. </P>

<P>2.16. Extension of Facility Termination Date. The Borrower may request an extension of the
Facility Termination Date by submitting a request for an extension to the Administrative Agent
(an "Extension Request") no more than 60 days prior to the Facility Termination Date. The
Extension Request must specify the new Facility Termination Date requested by the Borrower
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 Facility Termination Date shall be the first anniversary of the Facility
Termination Date in effect at the time the Extension Request is received, including the Facility
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 the Extension Request. Each Lender approving
the Extension Request shall deliver its written consent no later than the Response Date. If the
consent of each of the Lenders is received by the Administrative Agent (excluding any Person
which ceases to be a Lender pursuant to Section 3.7), the Facility Termination Date specified in
the Extension Request shall become effective on the existing Facility Termination Date and the
Administrative Agent shall promptly notify the Borrower and each Lender of the new Facility
Termination Date. </P>

<P ALIGN="CENTER"><strong>ARTICLE III<br>
</strong><strong>YIELD PROTECTION; TAXES </strong></P>

<P>3.1. Yield Protection. If, on or after the date of this Agreement, the adoption of any law or any
governmental or quasi-governmental rule, regulation, policy, guideline or directive (whether or
not having the force of law), or any change in the interpretation or administration thereof by any
governmental or quasi-governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Lender or applicable Lending
Installation with any request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency: </P>

<P>(i) subjects any Lender or any applicable Lending Installation to any Taxes, or changes the basis of
taxation of payments (other than with respect to Excluded Taxes) to any Lender in respect of its
Eurodollar Loans, or </P>

<P>(ii) imposes or increases or deems applicable any reserve, assessment, insurance charge, special
deposit or similar requirement against assets of, deposits with or for the account of, or credit
extended by, any Lender or any applicable Lending Installation (other than reserves and
assessments taken into account in determining the interest rate applicable to Eurodollar
Advances), or </P>

<P>(iii) imposes any other condition the result of which is to increase the cost to any Lender or any
applicable Lending Installation of making, funding or maintaining its Eurodollar Loans or
reduces any amount receivable by any Lender or any applicable Lending Installation in
connection with its Eurodollar Loans, or requires any Lender or any applicable Lending
Installation to make any payment calculated by reference to the amount of Eurodollar Loans held
or interest received by it, by an amount deemed material by such Lender, and the result of any of the foregoing is to increase the cost to such Lender or applicable Lending
Installation of making or maintaining its Eurodollar Loans or Commitment or to reduce the
return received by such Lender or applicable Lending Installation in connection with such
Eurodollar Loans or Commitment, then, within 15 days of demand by such Lender, the Borrower
shall pay such Lender such additional amount or amounts as will compensate such Lender for
such increased cost or reduction in amount received; 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 provided further that the foregoing proviso shall in
no way limit the right of any Lender to demand or receive such compensation to the extent that
such compensation relates to the retroactive application of any law, regulation, guideline or
request described above if such demand is made within 90 days after the implementation of such
retroactive law, interpretation, guideline or request.</P>

<P>3.2. Changes in Capital Adequacy Regulations. If a Lender determines the amount of capital
required or expected to be maintained by such Lender, any Lending Installation of such Lender or
any corporation controlling such Lender is increased as a result of a Change, then, within 15 days
of demand by such Lender, the Borrower shall pay such Lender the amount necessary to
compensate for any shortfall in the rate of return on the portion of such increased capital which
such Lender determines is attributable to this Agreement, its Loans or its Commitment to make
Loans hereunder (after taking into account such Lender's policies as to capital adequacy).
"Change" means (i) any change after the date of this Agreement in the Risk-Based Capital
Guidelines or (ii) any adoption of or change in any other law, governmental or
quasi-governmental rule, regulation, policy, guideline, interpretation, or directive (whether or not
having the force of law) after the date of this Agreement which affects the amount of capital
required or expected to be maintained by any Lender or any Lending Installation or any
corporation controlling any Lender. "Risk-Based Capital Guidelines" means (i) the risk-based
capital guidelines in effect in the United States on the date of this Agreement, including
transition rules, and (ii) the corresponding capital regulations promulgated by regulatory
authorities outside the United States implementing the July 1988 report of the Basle Committee
on Banking Regulation and Supervisory Practices Entitled "International Convergence of Capital
Measurements and Capital Standards," including transition rules, and any amendments to such
regulations adopted prior to the date of this Agreement. </P>

<P>3.3. Availability of Types of Advances. If any Lender determines that maintenance of its
Eurodollar Loans at a suitable Lending Installation would violate any applicable law, rule,
regulation, or directive, whether or not having the force of law, or if the Required Lenders
determine that (i) deposits of a type and maturity appropriate to match fund Eurodollar Advances
are not available or (ii) the interest rate applicable to Eurodollar Advances does not accurately
reflect the cost of making or maintaining Eurodollar Advances, then the Administrative Agent
shall suspend the availability of Eurodollar Advances and require any affected Eurodollar
Advances to be repaid or converted to Floating Rate Advances, subject to the payment of any
funding indemnification amounts required by Section 3.4. </P>

<P>3.4. Funding Indemnification. If any payment of a Eurodollar Advance occurs on a date which is
not the last day of the applicable Interest Period, whether because of acceleration, prepayment or
otherwise, or a Eurodollar Advance is not made on the date specified by the Borrower for any
reason other than default by the Lenders, the Borrower will indemnify each Lender for any loss
or cost incurred by it resulting therefrom, including, without limitation, any loss or cost in
liquidating or employing deposits acquired to fund or maintain such Eurodollar Advance. </P>

<P>3.5. Taxes. (i) All payments by the Borrower to or for the account of any Lender or the
Administrative Agent hereunder or under any Note shall be made free and clear of and without
deduction for any and all Taxes. If the Borrower shall be required by law to deduct any Taxes
from or in respect of any sum payable hereunder to any Lender or the Administrative Agent, (a)
the sum payable shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section 3.5) such Lender
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, (b) the Borrower shall make such deductions,
(c) the Borrower shall pay the full amount deducted to the relevant authority in accordance with
applicable law and (d) the Borrower shall furnish to the Administrative Agent the original copy
of a receipt evidencing payment thereof within 30 days after such payment is made. </P>

<P>(ii) In addition, the Borrower hereby agrees to pay any present or future stamp or documentary
taxes and any other excise or property taxes, charges or similar levies which arise from any
payment made hereunder or under any Note or from the execution or delivery of, or otherwise
with respect to, this Agreement or any Note ("Other Taxes"). </P>

<P>(iii) The Borrower hereby agrees to indemnify the Administrative Agent and each Lender for the
full amount of Taxes or Other Taxes (including, without limitation, any Taxes or Other Taxes
imposed on amounts payable under this Section 3.5) paid by the Administrative Agent or such
Lender as a result of its Commitment, any Loans made by it hereunder, or otherwise in
connection with its participation in this Agreement and any liability (including penalties, interest
and expenses) arising therefrom or with respect thereto. Payments due under this indemnification
shall be made within 30 days of the date the Administrative Agent or such Lender makes demand
therefor pursuant to Section 3.6. </P>

<P>(iv) Each Lender that is not incorporated under the laws of the United States of America or a state
thereof (each a "Non-U.S. Lender") agrees that it will, not more than ten Business Days after the
date of this Agreement, (i) deliver to each of the Borrower and the Administrative Agent two
duly completed copies of United States Internal Revenue Service Form W-8BEN or W-8ECI,
certifying in either case that such Lender is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes, and (ii) deliver to
each of the Borrower and the Administrative Agent a United States Internal Revenue Form W-8
or W-9, as the case may be, and certify that it is entitled to an exemption from United States
backup withholding tax. Each Non-U.S. Lender further undertakes to deliver to each of the
Borrower and the Administrative Agent (x) renewals or additional copies of such form (or any
successor form) on or before the date that such form expires or becomes obsolete, and (y) after
the occurrence of any event requiring a change in the most recent forms so delivered by it, such
additional forms or amendments thereto as may be reasonably requested by the Borrower or the
Administrative Agent. All forms or amendments described in the preceding sentence shall certify
that such Lender is entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes, unless an event (including without
limitation any change in treaty, law or regulation) has occurred prior to the date on which any
such delivery would otherwise be required which renders all such forms inapplicable or which
would prevent such Lender from duly completing and delivering any such form or amendment
with respect to it and such Lender advises the Borrower and the Administrative Agent that it is
not capable of receiving payments without any deduction or withholding of United States federal
income tax. </P>

<P>(v) For any period during which a Non-U.S. Lender has failed to provide the Borrower with an
appropriate form pursuant to clause (iv), above (unless such failure is due to a change in treaty,
law or regulation, or any change in the interpretation or administration thereof by any
governmental authority, occurring subsequent to the date on which a form originally was
required to be provided), such Non-U.S. Lender shall not be entitled to indemnification under
this Section 3.5 with respect to Taxes imposed by the United States; provided that, should a
Non-U.S. Lender which is otherwise exempt from or subject to a reduced rate of withholding tax
become subject to Taxes because of its failure to deliver a form required under clause (iv), above,
the Borrower shall take such steps as such Non-U.S. Lender shall reasonably request to assist
such Non-U.S. Lender to recover such Taxes. </P>

<P>(vi) Any Lender that is entitled to an exemption from or reduction of withholding tax with respect
to payments under this Agreement or any Note pursuant to the law of any relevant jurisdiction or
any treaty shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or
times prescribed by applicable law, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without withholding or at
a reduced rate. </P>

<P>(vii) If the U.S. Internal Revenue Service or any other governmental authority of the United States
or any other country or any political subdivision thereof asserts a claim that the Administrative
Agent did not properly withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered or properly completed, because such Lender
failed to notify the Administrative Agent of a change in circumstances which rendered its
exemption from withholding ineffective, or for any other reason), such Lender shall indemnify
the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative
Agent as tax, withholding therefor, or otherwise, including penalties and interest, and including
taxes imposed by any jurisdiction on amounts payable to the Administrative Agent under this
subsection, together with all costs and expenses related thereto (including attorneys fees and time
charges of attorneys for the Administrative Agent, which attorneys may be employees of the
Administrative Agent). The obligations of the Lenders under this Section 3.5(vii) shall survive
the payment of the Obligations and termination of this Agreement. </P>

<P>3.6. Lender Statements; Survival of Indemnity. To the extent reasonably possible, each Lender
shall designate an alternate Lending Installation with respect to its Eurodollar Loans to reduce
any liability of the Borrower to such Lender under Sections 3.1, 3.2 and 3.5 or to avoid the
unavailability of Eurodollar Advances under Section 3.3, so long as such designation is not, in
the judgment of such Lender, disadvantageous to such Lender. Each Lender shall deliver a
written statement of such Lender to the Borrower (with a copy to the Administrative Agent) as to
the amount due, if any, under Section 3.1, 3.2, 3.4 or 3.5. Such written statement shall set forth in
reasonable detail the calculations upon which such Lender determined such amount and shall be
final, conclusive and binding on the Borrower in the absence of manifest error. Determination of
amounts payable under such Sections in connection with a Eurodollar Loan shall be calculated as
though each Lender funded its Eurodollar Loan through the purchase of a deposit of the type and
maturity corresponding to the deposit used as a reference in determining the Eurodollar Rate
applicable to such Loan, whether in fact that is the case or not. Unless otherwise provided herein,
the amount specified in the written statement of any Lender shall be payable on demand after
receipt by the Borrower of such written statement. The obligations of the Borrower under
Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of the Obligations and termination of this
Agreement. </P>

<P>3.7. Substitution of Affected Lender. If (i) the obligation of any Lender to make or to convert or
continue outstanding Loans as or into Eurodollar Loans has been suspended pursuant to Section
3.3 or (ii) any Lender has demanded compensation under Section 3.1, 3.2 or 3.5, then the
Borrower shall have the right to designate a substitute lender or lenders (which may be one or
more of the other Lenders) mutually satisfactory to the Borrower and the Administrative Agent
(whose consent shall not be unreasonably withheld or delayed) to purchase for cash, pursuant to
an Assignment Agreement in substantially the form of Exhibit C hereto, the outstanding Loans of
such Lender and to assume the Commitment of such Lender, without recourse to or warranty by,
or expense to, such Lender, for a purchase price equal to the principal amount of all of such
Lender's outstanding Loans plus any accrued and unpaid interest thereon and the accrued but
unpaid fees in respect of such Lender's Commitment hereunder plus such amount, if any, as
would be payable pursuant to Section 3.4 if the outstanding Loans of such Lender were prepaid
in their entirety on the date of consummation of such assignment. </P>

<P ALIGN="CENTER"><strong>ARTICLE IV<br>
</strong><strong>CONDITIONS PRECEDENT </strong></P>

<P>4.1. Initial Advance. The Lenders shall not be required to make the initial Advance hereunder
unless the Borrower has made payment to the Administrative Agent for the account of the
Lenders in immediately available funds the upfront fees payable under Section 2.4 and the
Borrower has furnished to the Administrative Agent with sufficient copies for the Lenders: </P>

<P>(i) Copies of the articles or certificate of incorporation of the Borrower, together with all
amendments, and a certificate of good standing, each certified by the appropriate governmental
officer in its jurisdiction of incorporation, as well as any other information required by Section
326 of the USA PATRIOT ACT or necessary for the Administrative Agent or any Lender to
verify the identity of Borrower as required by Section 326 of the USA PATRIOT Act. </P>

<P>(ii) Copies, certified by the Secretary or Assistant Secretary of the Borrower, of its by-laws and of
its Board of Directors' resolutions and of resolutions or actions of any other body authorizing the
execution of the Loan Documents to which the Borrower is a party. </P>

<P>(iii) An incumbency certificate, executed by the Secretary or Assistant Secretary of the Borrower,
which shall identify by name and title and bear the signatures of the Authorized Officers and any
other officers of the Borrower authorized to sign the Loan Documents to which the Borrower is a
party, upon which certificate the Administrative Agent and the Lenders shall be entitled to rely
until informed of any change in writing by the Borrower. </P>

<P>(iv) A certificate, signed by the chief financial officer of the Borrower, stating that on the initial
Borrowing Date no Default or Unmatured Default has occurred and is continuing. </P>

<P>(v) A written opinion of the Borrower's counsel, addressed to the Lenders in substantially the
form of Exhibit A. </P>

<P>(vi) Any Notes requested by a Lender pursuant to Section 2.10 payable to the order of each such
requesting Lender. </P>

<P>(vii) Written money transfer instructions, in substantially the form of Exhibit D, addressed to the
Administrative Agent and signed by an Authorized Officer, together with such other related
money transfer authorizations as the Administrative Agent may have reasonably requested. </P>

<P>(viii) Evidence satisfactory to the Administrative Agent of the termination of the Existing Credit
Agreements and repayment of all amounts owing thereunder. </P>

<P>(ix) Evidence satisfactory to the Administrative Agent of any required governmental approvals or
consents regarding this Agreement. </P>

<P>(x) Such other documents as any Lender or its counsel may have reasonably requested. </P>

<P>4.2. Each Advance. The Lenders shall not be required to make any Advance unless on the
applicable Borrowing Date: </P>

<P>(i) There exists no Default or Unmatured Default. </P>

<P>(ii) The representations and warranties contained in Article V (other than, in the case of an
Advance the proceeds of which are being used exclusively to repay commercial paper of the
Borrower, Sections 5.5, 5.7 and 5.12) are true and correct as of such Borrowing Date except to
the extent any such representation or warranty is stated to relate solely to an earlier date, in which
case such representation or warranty shall have been true and correct on and as of such earlier
date. </P>

<P>(iii) All legal matters incident to the making of such Advance shall be satisfactory to the Lenders
and their counsel (including, without limitation, evidence satisfactory to the Administrative
Agent of any required governmental approvals or consents regarding such Advance). </P>

<P>Each Borrowing Notice with respect to each such Advance shall constitute a representation and
warranty by the Borrower that the conditions contained in Sections 4.2(i) and (ii) have been
satisfied. Any Lender may require a duly completed compliance certificate in substantially the
form of Exhibit B as a condition to making an Advance.</P>

<P ALIGN="CENTER"><strong>ARTICLE V<br>
</strong><strong>REPRESENTATIONS AND WARRANTIES </strong></P>

<P>The Borrower represents and warrants to the Lenders that:</P>

<P>5.1. Existence and Standing. Each of the Borrower and its Subsidiaries is a corporation, partnership
(in the case of Subsidiaries only) or limited liability company duly and properly incorporated or
organized, as the case may be, validly existing and (to the extent such concept applies to such
entity) in good standing under the laws of its jurisdiction of incorporation or organization and has
all requisite authority to conduct its business in each jurisdiction in which its business is
conducted. </P>

<P>5.2. Authorization and Validity. The Borrower has the power and authority and legal right to
execute and deliver the Loan Documents and to perform its obligations thereunder. The
execution and delivery by the Borrower of the Loan Documents and the performance of its
obligations thereunder have been duly authorized by proper corporate proceedings, and the Loan
Documents constitute legal, valid and binding obligations of the Borrower enforceable against
the Borrower in accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors' rights generally. </P>

<P>5.3. No Conflict; Government Consent. Neither the execution and delivery by the Borrower of
the Loan Documents, nor the consummation of the transactions therein contemplated, nor
compliance with the provisions thereof will violate (i) any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on the Borrower or any of its Principal
Subsidiaries or (ii) the Borrower's or any Principal Subsidiary's articles or certificate of
incorporation, partnership agreement, certificate of partnership, articles or certificate of
organization, by-laws, or operating or other management agreement, as the case may be, or (iii)
the provisions of any indenture, instrument or agreement to which the Borrower or any of its
Principal Subsidiaries is a party or is subject, or by which it, or its Property, is bound, or conflict
with or constitute a default thereunder, or result in, or require, the creation or imposition of any
Lien in, of or on the Property of the Borrower or a Principal Subsidiary pursuant to the terms of
any such indenture, instrument or agreement. No order, consent, adjudication, approval, license,
authorization, or validation of, or filing, recording or registration with, or exemption by, or other
action in respect of any governmental or public body or authority, or any subdivision thereof,
which has not been obtained by the Borrower or any of its Principal Subsidiaries, is required to
be obtained by the Borrower or any of its Principal Subsidiaries in connection with the execution
and delivery of the Loan Documents, the borrowings under this Agreement, the payment and
performance by the Borrower of the Obligations or the legality, validity, binding effect or
enforceability of any of the Loan Documents. </P>

<P>5.4. Financial Statements. The December 31, 2003 consolidated financial statements of the
Borrower and its Subsidiaries heretofore delivered to the Lenders were prepared in accordance
with generally accepted accounting principles in effect on the date such statements were prepared
and fairly present in all material respects the consolidated financial condition and operations of
the Borrower and its Subsidiaries at such date and the consolidated results of their operations for
the period then ended. </P>

<P>5.5. Material Adverse Change. Since December 31, 2003, there has been no change in the
business, Property, condition (financial or otherwise) or results of operations of the Borrower and
its Subsidiaries, taken as a whole, which could reasonably be expected to have a Material
Adverse Effect. </P>

<P>5.6. Taxes. MGE Energy, Inc. the parent corporation for the Borrower, has, or the Borrower and
its Subsidiaries have, filed all United States federal tax returns and all other tax returns which are
required to be filed and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries, except such taxes, if any, as are
being contested in good faith and as to which adequate reserves have been provided in
accordance with GAAP and as to which no Lien exists. The United States income tax returns of
the Borrower and its Subsidiaries have been audited by the Internal Revenue Service through the
fiscal year ended December 31, 1996. No tax liens have been filed and no claims are being
asserted with respect to any such taxes, except such taxes, if any, as are being contested in good
faith and as to which adequate reserves have been provided in accordance with GAAP. The
charges, accruals and reserves on the books of the Borrower and its Subsidiaries in respect of any
taxes or other governmental charges are adequate. </P>

<P>5.7. Litigation and Contingent Obligations. There is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of their officers,
threatened against or affecting the Borrower or any of its Principal Subsidiaries which could
reasonably be expected to have a Material Adverse Effect or which seeks to prevent, enjoin or
delay the making of any Loans. Other than any liability incident to any litigation, arbitration or
proceeding which could not reasonably be expected to have a Material Adverse Effect, the
Borrower has no material contingent obligations not provided for or disclosed in the financial
statements referred to in Section 5.4. </P>

<P>5.8. Subsidiaries. Schedule 1 contains an accurate list of all Subsidiaries of the Borrower as of
the date of this Agreement, setting forth their respective jurisdictions of organization and the
percentage of their respective capital stock or other ownership interests owned by the Borrower
or other Subsidiaries. All of the issued and outstanding shares of capital stock or other ownership
interests of such Subsidiaries have been (to the extent such concepts are relevant with respect to
such ownership interests) duly authorized and issued and are fully paid and non-assessable. </P>

<P>5.9. ERISA. The Unfunded Liabilities of all Single Employer Plans do not in the aggregate
exceed $25,000,000. Neither the Borrower nor any other member of the Controlled Group has
incurred, or is reasonably expected to incur, any withdrawal liability to Multiemployer Plans in
excess of $25,000,000 in the aggregate. Each Plan complies in all material respects with all
applicable requirements of law and regulations, no Reportable Event for which the PBGC has not
waived the 30-day notice requirement has occurred with respect to any Plan, neither the
Borrower nor any other member of the Controlled Group has withdrawn from any Plan or
initiated steps to do so, and no steps have been taken to reorganize or terminate any Plan. </P>

<P>5.10. Accuracy of Information. No information, exhibit or report furnished by the Borrower or
any of its Subsidiaries to the Administrative Agent or to any Lender in connection with the
negotiation of, or compliance with, the Loan Documents contained any material misstatement of
fact or omitted to state a material fact or any fact necessary to make the statements contained
therein not misleading in any material respect. </P>

<P>5.11. Regulation. Margin stock (as defined in Regulation U) constitutes less than 25% of the
value of those assets of the Borrower and its Subsidiaries which are subject to any limitation on
sale, pledge, or other restriction hereunder. </P>

<P>5.12. Material Agreements. Neither the Borrower nor any Principal Subsidiary is a party to any
agreement or instrument or subject to any charter or other corporate restriction which could
reasonably be expected to have a Material Adverse Effect. Neither the Borrower nor any
Principal Subsidiary is in default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in (i) any agreement to which it is a party, which
default could reasonably be expected to have a Material Adverse Effect or (ii) any agreement or
instrument evidencing or governing Indebtedness, which default could reasonably be expect to
have a Material Adverse Effect. </P>

<P>5.13. Compliance With Laws. The Borrower and its Principal Subsidiaries have complied with
all applicable statutes, rules, regulations, orders and restrictions of any domestic or foreign
government or any instrumentality or agency thereof having jurisdiction over the conduct of their
respective businesses or the ownership of their respective Property except for any failure to
comply with any of the foregoing which could not reasonably be expected to have a Material
Adverse Effect. </P>

<P>5.14. Ownership of Properties. On the date of this Agreement, the Borrower and its Subsidiaries
have good title, free of all Liens other than those permitted by Section 6.13, to all of the Property
and assets reflected in the Borrower's most recent consolidated financial statements provided to
the Administrative Agent as owned by the Borrower and its Subsidiaries. </P>

<P>5.15. Plan Assets; Prohibited Transactions. The Borrower is not an entity deemed to hold "plan
assets" within the meaning of 29 C.F.R. &sect; 2510.3-101 of an employee benefit plan (as defined in
Section 3(3) of ERISA) which is subject to Title I of ERISA or any plan (within the meaning of
Section 4975 of the Code), and neither the execution of this Agreement nor the making of Loans
hereunder gives rise to a prohibited transaction within the meaning of Section 406 of ERISA or
Section 4975 of the Code. </P>

<P>5.16. Environmental Matters. In the ordinary course of its business, the officers of the Borrower
consider the effect of Environmental Laws on the business of the Borrower and its Subsidiaries,
in the course of which they identify and evaluate potential risks and liabilities accruing to the
Borrower due to Environmental Laws. On the basis of this consideration, the Borrower has
concluded that Environmental Laws cannot reasonably be expected to have a Material Adverse
Effect, except to the extent disclosed in the Borrower's Form 10-K and Form 10-Q reports filed
with the SEC prior to the date hereof. Neither the Borrower nor any Principal Subsidiary has
received any notice to the effect that its operations are not in material compliance with any of the
requirements of applicable Environmental Laws or are the subject of any federal or state
investigation evaluating whether any remedial action is needed to respond to a release of any
toxic or hazardous waste or substance into the environment, which non-compliance or remedial
action could reasonably be expected to have a Material Adverse Effect. </P>

<P>5.17. Investment Company Act. Neither the Borrower nor any Subsidiary is an "investment
company" or a company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended. </P>

<P>5.18. Public Utility Holding Company Act. The Borrower is a "subsidiary company" of a
"holding company" within the meaning of the Public Utility Holding Company Act of 1935, as
amended; however, that holding company is exempt from the provisions of that Act, except
Section 9(a)(2) thereof, by virtue of having filed with the SEC a Statement by Holding Company
Claiming Exemption Under Rule U-2 from the Provisions of the Public Utility Holding
Company Act of 1935 on Form U-3A-2. Such exemption is in full force and effect and the
Borrower is not aware of any existing or proposed proceedings contemplating the revocation or
modification of such exemption. </P>

<P>5.19. Insurance. The Borrower and its Principal Subsidiaries maintain with financially sound and
reputable insurance companies insurance on all their Property in such amounts and covering such
risks as is consistent with sound business practice. </P>

<P>5.20. Regulatory Approval. No consent, authorization or approval of, and/or filing or registration
with, any governmental body or regulatory authority is required in connection with the execution,
delivery or performance of this Agreement or the Notes or for the consummation of the
transactions herein contemplated, or for the validity or enforceability thereof (other than
authorization from the Public Service Commission of Wisconsin). </P>

<P ALIGN="CENTER"><strong>ARTICLE VI<br>
</strong><strong>COVENANTS </strong></P>

<P>During the term of this Agreement, unless the Required Lenders shall otherwise consent in
writing:</P>

<P>6.1. Financial Reporting. The Borrower will maintain, for itself and each Subsidiary, a system of
accounting established and administered in accordance with generally accepted accounting
principles, and furnish to the Lenders: </P>

<P>(i) Within 90 days after the close of each of its fiscal years, an unqualified (except for
qualifications relating to changes in accounting principles or practices reflecting changes in
generally accepted accounting principles and required or approved by the Borrower's independent
certified public accountants) audit report certified by independent certified public accountants
reasonably acceptable to the Lenders, prepared in accordance with GAAP on a consolidated for
itself and its Subsidiaries, including balance sheets as of the end of such period, related profit and
loss and reconciliation of surplus statements, and a statement of cash flows. </P>

<P>(ii) Within 45 days after the close of the first three quarterly periods of each of its fiscal years, for
itself and its Subsidiaries, consolidated unaudited balance sheets as at the close of each such
period and consolidated profit and loss and reconciliation of surplus statements and a statement
of cash flows for the period from the beginning of such fiscal year to the end of such quarter, all
certified by its chief financial officer. </P>

<P>(iii) Notwithstanding the preceding provisions of this Section 6.1, if and so long as the Borrower
shall file regular and periodic reports with the SEC pursuant to Sections 13 and 15 of the
Securities Exchange Act of 1934, delivery to the Administrative Agent of copies of the
Borrower's reports on Forms 10K and 10Q promptly following filing thereof with the SEC, but
in any event not later than within the periods set forth in subsections 6.1(i) and (ii), shall
constitute full compliance with those sections. </P>

<P>(iv) Together with the financial statements required under Sections 6.1(i) and (ii), a compliance
certificate in substantially the form of Exhibit B signed by its chief financial officer or treasurer
showing the calculations necessary to determine compliance with this Agreement and stating that
no Default or Unmatured Default exists, or if any Default or Unmatured Default exists, stating
the nature and status thereof. </P>

<P>(v) As soon as possible and in any event within 10 days after the Borrower knows that any
Reportable Event has occurred with respect to any Plan, a statement, signed by the chief financial
officer or treasurer of the Borrower, describing said Reportable Event and the action which the
Borrower proposes to take with respect thereto. </P>

<P>(vi) As soon as possible and in any event within 10 days after receipt by the Borrower, a copy of
(a) any notice or claim to the effect that the Borrower or any of its Principal Subsidiaries is or
may be liable to any Person as a result of the release by the Borrower, any of its Principal
Subsidiaries, or any other Person of any toxic or hazardous waste or substance into the
environment, and (b) any notice alleging any violation of any federal, state or local
environmental, health or safety law or regulation by the Borrower or any of its Principal
Subsidiaries, which, in either case, could reasonably be expected to have a Material Adverse
Effect. </P>

<P>(vii) Promptly upon the filing thereof, copies of all registration statements and annual, quarterly,
monthly or other regular reports which the Borrower or any of its Principal Subsidiaries files
with the SEC. </P>

<P>(viii) Such other information (including non-financial information) as the Administrative Agent or
any Lender may from time to time reasonably request. </P>

<P>6.2. Litigation. The Borrower shall promptly give to each Lender notice of all legal or arbitral
proceedings, and of all proceedings before any governmental or regulatory authority or agency, to
which the Borrower or its Principal Subsidiaries is a party, except proceedings as to which there
is no reasonable possibility of an adverse determination or which, if adversely determined, would
not have a Material Adverse Effect during the term of this Agreement. </P>

<P>6.3. Use of Proceeds. The Borrower will, and will cause each Subsidiary to, use the proceeds of
the Advances for general corporate purposes (in compliance with all applicable legal and
regulatory requirements). </P>

<P>6.4. Notice of Default. The Borrower will, and will cause each Principal Subsidiary to, give
prompt notice in writing to the Lenders of the occurrence of any Default or Unmatured Default of
which it becomes aware and of any other development, financial or otherwise, of which it
becomes aware which could reasonably be expected to have a Material Adverse Effect. </P>

<P>6.5. Conduct of Business. The Borrower will, and will cause each Principal Subsidiary to, carry
on and conduct its business in substantially the same manner and in substantially the same fields
of enterprise as it is presently conducted and do all things necessary to remain duly incorporated
or organized, validly existing and (to the extent such concept applies to such entity) in good
standing as a domestic corporation, partnership or limited liability company in its jurisdiction of
incorporation or organization, as the case may be, and maintain all requisite authority to conduct
its business in each jurisdiction in which its business is conducted, provided that this Section
shall not be deemed to prohibit any transaction permitted under Section 6.11 or 6.12. </P>

<P>6.6. Taxes. The Borrower will, and will cause each Principal Subsidiary to, timely file complete
and correct United States federal and applicable foreign, state and local tax returns required by
law and pay when due all taxes, assessments and governmental charges and levies upon it or its
income, profits or Property, except those which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves have been set aside in accordance with
GAAP or where nonpayment could not reasonably be expected to have a Material Adverse
Effect. </P>

<P>6.7. Insurance. The Borrower will, and will cause each Principal Subsidiary to, maintain with
financially sound and reputable insurance companies insurance on all their Property in such
amounts and covering such risks as is consistent with sound business practice, and the Borrower
will furnish to any Lender upon request full information as to the insurance carried. </P>

<P>6.8. Compliance with Laws. The Borrower will, and will cause each Principal Subsidiary to,
comply with all laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards
to which it may be subject including, without limitation, all Environmental Laws, except where
noncompliance would not have a Material Adverse Effect.. </P>

<P>6.9. Maintenance of Properties. The Borrower will, and will cause each Principal Subsidiary to,
do all things necessary to maintain, preserve, protect and keep its Property (except such Property
the failure of which to maintain or preserve would not have individually or in the aggregate, a
Material Adverse Effect) in good repair, working order and condition, ordinary wear and tear
excepted, and make all necessary and proper repairs, renewals and replacements so that its
business carried on in connection therewith may be properly conducted at all times. </P>

<P>6.10. Inspection. The Borrower will, and will cause each Principal Subsidiary to, permit the
Administrative Agent and the Lenders, by their respective representatives and Administrative
Agents, to inspect any of the Property, books and financial records of the Borrower and each
Principal Subsidiary, to examine and make copies of the books of accounts and other financial
records of the Borrower and each Principal Subsidiary, and to discuss the affairs, finances and
accounts of the Borrower and each Principal Subsidiary with, and to be advised as to the same
by, their respective officers at such reasonable times and intervals as the Administrative Agent or
any Lender may designate. </P>

<P>6.11. Merger. The Borrower will not, nor will it permit any Principal Subsidiary to, merge or
consolidate with or into any other Person, except that a Subsidiary may merge into the Borrower
or a Wholly-Owned Subsidiary. </P>

<P>6.12. Sale of Assets. The Borrower will not, nor will it permit any Principal Subsidiary to, lease,
sell or otherwise dispose of its Property to any other Person, except: </P>

<P>(i) Sales of inventory in the ordinary course of business. </P>

<P>(ii) Leases, sales or other dispositions of its Property that, together with all other Property of the
Borrower and its Principal Subsidiaries previously leased, sold or disposed of (other than
inventory in the ordinary course of business) as permitted by this Section during the
twelve-month period ending with the month in which any such lease, sale or other disposition
occurs, do not constitute a Substantial Portion of the Property of the Borrower and its
Subsidiaries. </P>

<P>(iii) Leases, sales or other dispositions of Property by a Subsidiary to the Borrower or another
Subsidiary. </P>

<P>6.13. Liens. The Borrower will not, nor will it permit any Principal Subsidiary to, create, incur,
or suffer to exist any Lien in, of or on the Property of the Borrower or any of its Principal
Subsidiaries, except: </P>

<P>(i) Liens for taxes, assessments or governmental charges or levies on its Property if the same shall
not at the time be delinquent or thereafter can be paid without penalty, or are being contested in
good faith and by appropriate proceedings. </P>

<P>(ii) Liens imposed by law, such as carriers', warehousemen's and mechanics' liens and other
similar liens arising in the ordinary course of business which secure payment of obligations not
more than 60 days past due. </P>

<P>(iii) Liens arising out of pledges or deposits under worker's compensation laws, unemployment
insurance, old age pensions, or other social security or retirement benefits, or similar legislation. </P>

<P>(iv) Lien incidental to the normal conduct of the business of the Borrower or any Subsidiary or the
ownership of its property or the conduct of the ordinary course of its business, including (A)
zoning restrictions, easements, rights of way, reservations, restrictions on the use of real property
and other minor irregularities of title, (B) rights of lessees under leases, (C) rights of collecting
banks having rights of setoff, revocation, refund or chargeback with respect to money or
instruments of the Borrower or any Subsidiary on deposit with or in the possession of such banks
(D) Liens to secure the performance of statutory obligations, tenders, bids, leases, progress
payments, performance or return-of-money bonds, performance or other similar bonds or other
obligations of a similar nature incurred in the ordinary course of business, and (E) Liens required
by any contract or statute in order to permit the Borrower or a Subsidiary of the Borrower to
perform any contract or subcontract made by it with or pursuant to the requirements of a
governmental entity, in each case which are not incurred in connection with the borrowing or
money, the obtaining of advances or credit or the payment of the deferred purchase price of
Property and which do not in the aggregate impair the use of property in the operation of the
business of the Borrower and its Subsidiaries taken as a whole. </P>

<P>(v) Liens on property existing at the time of acquisition thereof or Liens affecting property of a
Person existing at the time it becomes a Subsidiary of the Borrower or at the time it is merged
into or consolidated with the Borrower or a Subsidiary of the Borrower; provided, however, that,
in either case, such Liens were not granted in contemplation of such acquisition or in
contemplation of the transaction pursuant to which such Person became a Subsidiary; and
provided further that in either case, such Liens do not extend to or cover any property of the
Borrower or of any of its Subsidiaries other than the property that secured the acquired
Indebtedness prior to the time such Indebtedness became Indebtedness of the Borrower or a
Subsidiary. </P>

<P>(vi) Liens on property securing Indebtedness incurred prior to, at the time of, or within 12 months
after the acquisition thereof for the purpose of financing all or part of the purchase price thereof,
provided that such Liens do not extend to or cover any other property of the Borrower or any
Subsidiary and the Indebtedness secured thereby was incurred to pay, and does not exceed, the
purchase price thereof. </P>

<P>(vii) Liens on any improvements to property securing Indebtedness incurred to provide funds for
all or part of the cost of such improvements in a principal amount not exceeding the cost of
acquisition or construction of such improvements and incurred within 12 months after
completion of such improvements or construction, provided that such Liens do not extend to or
cover any property of the Borrower or any Subsidiary other than such improvements. </P>

<P>(viii) Liens to government entities granted to secure pollution control or industrial revenue bond
financings, which Liens in each financing transaction cover only the property the acquisition of
which, or the construction of which, was financed by such financing, and property related
thereto. </P>

<P>(ix) Any Lien incurred or deposits to secure the performance of surety bonds incurred in the
ordinary course of business consistent with past practice, provided that such Liens shall cover
only the Borrower's or its Subsidiary' interests in and relating to the contract underlying the
transaction for which such surety bonds were issued. </P>

<P>(x) Liens on cash or cash equivalents created or existing to secure stay or appeal bonds or
otherwise resulting from any litigation or legal proceeding which are being contested in good
faith by appropriate action promptly initiated and diligently conducted, including the Lien of any
judgment; provided, however, that the aggregate amount secured by all such Liens does not
exceed $25 million. </P>

<P>(xi) Liens securing any extension, renewal, replacement or refinancing of Indebtedness secured by
any Lien referred to in the foregoing clauses (v), (vi), (vii), (viii), and (xii); provided, however,
that </P>

<P>(A) such new Lien shall be limited to all or part of the same property that secured the original
Lien (plus improvements on such property) and</P>

<P>(B) the amount secured by such Lien at such time is not increased to any amount greater than the
amount outstanding at the time of such renewal, replacement or refinancing.</P>

<P>(xii). Liens existing on the date hereof and described in Schedule 6.13. </P>

<P>6.14. Affiliates. The Borrower will not, and will not permit any Principal Subsidiary to, enter into
any transaction (including, without limitation, the purchase or sale of any Property or service)
with, or make any payment or transfer to, any Affiliate (i) except in the ordinary course of
business and pursuant to the reasonable requirements of the Borrower's or such Principal
Subsidiary's business and upon fair and reasonable terms no less favorable to the Borrower or
such Principal Subsidiary than the Borrower or such Subsidiary would obtain in a comparable
arms-length transaction or (ii) pursuant to agreements or transactions authorized or approved by
the Public Service Commission of Wisconsin (provided that in the case of any agreement or
transaction having terms that are less favorable to the Borrower or such Principal Subsidiary than
the Borrower or such Subsidiary would obtain in a comparable arms-length transaction, such
authorization or approval acknowledges the non-arms-length nature of such terms). </P>

<P>6.15. Financial Covenant. The Borrower will not permit the ratio of (i) its Consolidated
Indebtedness to (ii) its Consolidated Total Capitalization to exceed 0.65 to 1.0 at any time. </P>

<P ALIGN="CENTER"><strong>ARTICLE VII<br>
</strong><strong>DEFAULTS </strong></P>

<P>The occurrence of any one or more of the following events shall constitute a Default:</P>

<P>7.1. The Borrower shall default in the payment of any principal of any Loan when due. </P>

<P>7.2. The Borrower shall default in the payment of interest on any Loan or any other amount
payable by it hereunder and such default shall continue for two Business Days after the same
becomes due and payable. </P>

<P>7.3. The Borrower or any of its Principal Subsidiaries shall default in the payment when due of
any principal of or interest on any of its other Indebtedness having a principal amount of
$25,000,000 or more; or any event specified in any note, agreement, indenture or other document
evidencing or relating to any such Indebtedness shall occur if the effect of such event is to cause,
or (with the giving of any notice or the lapse of time or both) to permit the holder or holders of
such Indebtedness (or a trustee or agent on behalf of such holder or holders) to cause, such
Indebtedness to become due prior to its stated maturity. </P>

<P>7.4. Any representation, warranty or certification made or deemed made herein by the Borrower,
or any certificate furnished to any Lender or the Administrative Agent pursuant to the provisions
hereof, shall prove to have been false or misleading as of the time made, deemed made, or
furnished in any material respect. </P>

<P>7.5. The Borrower shall default in the performance of its obligations under Section 6.3, 6.4, 6.10,
6.11, 6.12, 6.13, 6.14 or 6.15 hereof. </P>

<P>7.6. The Borrower shall default in the performance of any of its other obligations in this
Agreement and such default shall continue unremedied for a period of 30 days after the earlier of
(i) the date on which a senior officer of the Borrower becomes aware of such default, or (ii) the
date on which notice thereof is given to the Borrower by the Administrative Agent or any Lender
(through the Administrative Agent). </P>

<P>7.7. The Borrower shall admit in writing its inability to, or be generally unable to, pay its debts as
such debts become due. </P>

<P>7.8. The Borrower shall (i) apply for or consent to the appointment of, or the taking of possession
by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its
property, (ii) make a general assignment for the benefit of its creditors, (iii) commence a
voluntary case under the Bankruptcy Code (as now or hereafter in effect), (iv) file a petition
seeking to take advantage of any other law relating to bankruptcy, insolvency, reorganization,
winding-up, or composition or readjustment of debts, (v) fail to controvert in a timely and
appropriate manner, or acquiesce in writing to, any petition filed against it in an involuntary case
under the Bankruptcy Code, or (vi) take any corporate action for the purpose of effecting any of
the foregoing. </P>

<P>7.9. A proceeding or case shall be commenced, without the application or consent of the
Borrower, in any court of competent jurisdiction, seeking (i) its liquidation, reorganization,
dissolution or winding-up, or the composition or readjustment of its debts, (ii) the appointment of
a trustee, receiver, custodian, liquidator or the like of the Borrower or of all or any substantial
part of its assets, or (iii) similar relief in respect of the Borrower under any law relating to
bankruptcy, insolvency, reorganization, winding-up or composition or adjustment of debts, and
such proceeding or case shall continue undismissed, or an order, judgment or decree approving or
ordering any of the foregoing shall be entered and continue unstayed and in effect, for a period of
60 days; or an order for relief against the Borrower shall be entered in an involuntary case under
the Bankruptcy Code. </P>

<P>7.10. A final judgment or judgments for the payment of money in excess of $25,000,000 in the
aggregate that is not covered by insurance, performance bonds or the like shall be rendered by a
court or courts against the Borrower or any of its Principal Subsidiaries, and the same shall not
be discharged (or provision shall not be made for such discharge), or a stay of execution thereof
shall not be procured, within 90 days from the date of entry thereof and the Borrower or the
relevant Principal Subsidiary shall not, within said period of 90 days, or such longer period
during which execution of the same shall have been stayed, appeal therefrom and cause the
execution thereof to be stayed during such appeal. </P>

<P>7.11. Any of the following events shall occur with respect to any Pension Plan: </P>

<P>(i) the institution of any steps by the Borrower, any member of its Controlled Group or any other
Person to terminate a Pension Plan if, as a result of such termination, the Borrower or any such
member could be required to make a contribution to such Pension Plan, or could reasonably
expect to incur a liability or obligation to such Pension Plan, in excess of $25,000,000; or </P>

<P>(ii) the complete or partial withdrawal from any Pension Plan by the Borrower or any member of
its Controlled Group if, as a result of such withdrawal, the Borrower or any such member could
incur any liability by such Pension Plan in excess of $25,000,000; or </P>

<P>(iii) a contribution failure occurs with respect to any Pension Plan sufficient to give rise to a Lien
under Section 302(f) of ERISA. </P>

<P>7.12. Any license, consent, authorization or approval, filing or registration now or hereafter
necessary to enable the Borrower to comply with its obligations hereunder or under the Notes
shall be revoked, withdrawn, withheld or not effected or shall cease to be in full force and effect. </P>

<P>7.13. A Change in Control shall occur. </P>

<P ALIGN="CENTER"><strong>ARTICLE VIII<br>
</strong><strong>ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES </strong></P>

<P>8.1. Acceleration. If any Default described in Section 7.7 or 7.8 occurs with respect to the
Borrower, the obligations of the Lenders to make Loans hereunder shall automatically terminate
and the Obligations shall immediately become due and payable without any election or action on
the part of the Administrative Agent or any Lender. If any other Default occurs, the Required
Lenders (or the Administrative Agent with the consent of the Required Lenders) may terminate
or suspend the obligations of the Lenders to make Loans hereunder, or declare the Obligations to
be due and payable, or both, whereupon the Obligations shall become immediately due and
payable, without presentment, demand, protest or notice of any kind, all of which the Borrower
hereby expressly waives. </P>

<P>If, within 30 days after acceleration of the maturity of the Obligations or termination of the
obligations of the Lenders to make Loans hereunder as a result of any Default (other than any
Default as described in Section 7.7 or 7.8 with respect to the Borrower) and before any judgment
or decree for the payment of the Obligations due shall have been obtained or entered, the
Required Lenders (in their sole discretion) shall so direct, the Administrative Agent shall, by
notice to the Borrower, rescind and annul such acceleration and/or termination.</P>

<P>8.2. Amendments. Subject to the provisions of this Article VIII, the Required Lenders (or the
Administrative Agent with the consent in writing of the Required Lenders) and the Borrower
may enter into agreements supplemental hereto for the purpose of adding or modifying any
provisions to the Loan Documents or changing in any manner the rights of the Lenders or the
Borrower hereunder or waiving any Default hereunder; provided, however, that no such
supplemental agreement shall, without the consent of all of the Lenders: </P>

<P>(i) Extend the final maturity of any Loan or forgive all or any portion of the principal amount
thereof, or reduce the rate or extend the time of payment of interest or fees thereon. </P>

<P>(ii) Reduce the percentage specified in the definition of Required Lenders. </P>

<P>(iii) Extend the Facility Termination Date, or reduce the amount or extend the payment date for
the mandatory payments required under Section 2.1.4, or increase the amount of the Aggregate
Commitment or of the Commitment of any Lender hereunder, or permit the Borrower to assign
its rights under this Agreement. </P>

<P>(iv) Amend this Section 8.2. </P>

<P>No amendment of any provision of this Agreement relating to the Administrative Agent shall be
effective without the written consent of the Administrative Agent. The Administrative Agent
may waive payment of the fee required under Section 12.3.2 without obtaining the consent of any
other party to this Agreement.</P>

<P>8.3. Preservation of Rights. No delay or omission of the Lenders or the Administrative Agent to
exercise any right under the Loan Documents shall impair such right or be construed to be a
waiver of any Default or an acquiescence therein, and the making of a Loan notwithstanding the
existence of a Default or the inability of the Borrower to satisfy the conditions precedent to such
Loan shall not constitute any waiver or acquiescence. Any single or partial exercise of any such
right shall not preclude other or further exercise thereof or the exercise of any other right, and no
waiver, amendment or other variation of the terms, conditions or provisions of the Loan
Documents whatsoever shall be valid unless in writing signed by the Lenders required pursuant
to Section 8.2, and then only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative and all shall be
available to the Administrative Agent and the Lenders until the Obligations have been paid in
full. </P>

<P ALIGN="CENTER"><strong>ARTICLE IX<br>
</strong><strong>GENERAL PROVISIONS </strong></P>

<P>9.1. Survival of Representations. All representations and warranties of the Borrower contained in
this Agreement shall survive during the period that the Loans herein contemplated are
outstanding. </P>

<P>9.2. Governmental Regulation. Anything contained in this Agreement to the contrary
notwithstanding, no Lender shall be obligated to extend credit to the Borrower in violation of any
limitation or prohibition provided by any applicable statute or regulation. </P>

<P>9.3. Headings. Section headings in the Loan Documents are for convenience of reference only,
and shall not govern the interpretation of any of the provisions of the Loan Documents. </P>

<P>9.4. Entire Agreement. The Loan Documents embody the entire agreement and understanding
among the Borrower, the Administrative Agent and the Lenders and supersede all prior
agreements and understandings among the Borrower, the Administrative Agent and the Lenders
relating to the subject matter thereof other than the fee letter described in Section 10.13. </P>

<P>9.5. Several Obligations; Benefits of this Agreement. The respective obligations of the Lenders
hereunder are several and not joint and no Lender shall be the partner or Administrative Agent of
any other (except to the extent to which the Administrative Agent is authorized to act as such).
The failure of any Lender to perform any of its obligations hereunder shall not relieve any other
Lender from any of its obligations hereunder. This Agreement shall not be construed so as to
confer any right or benefit upon any Person other than the parties to this Agreement and their
respective successors and assigns, provided, however, that the parties hereto expressly agree that
the Arranger shall enjoy the benefits of the provisions of Sections 9.6, 9.10 and 10.11 to the
extent specifically set forth therein and shall have the right to enforce such provisions on its own
behalf and in its own name to the same extent as if it were a party to this Agreement. </P>

<P>9.6. Expenses; Indemnification. (i) The Borrower shall reimburse the Administrative Agent and
the Arranger for any reasonable costs, internal charges and out-of-pocket expenses (including
attorneys' fees and time charges of attorneys for the Administrative Agent, which attorneys may
be employees of the Administrative Agent) paid or incurred by the Administrative Agent or the
Arranger in connection with the preparation, negotiation, execution, delivery, syndication,
distribution (including, without limitation, via the internet, review, amendment, modification,
and administration of the Loan Documents. The Borrower also agrees to reimburse the
Administrative Agent, the Arranger and the Lenders for any costs, internal charges and
out-of-pocket expenses (including attorneys' fees and time charges of attorneys for the
Administrative Agent, the Arranger and the Lenders, which attorneys may be employees of the
Administrative Agent, the Arranger or the Lenders) paid or incurred by the Administrative
Agent, the Arranger or any Lender in connection with the collection and enforcement of the Loan
Documents. Expenses being reimbursed by the Borrower under this Section include, without
limitation, costs and expenses incurred in connection with the Reports described in the following
sentence. The Borrower acknowledges that from time to time Bank One may prepare and may
distribute to the Lenders (but shall have no obligation or duty to prepare or to distribute to the
Lenders) certain audit reports (the "Reports") pertaining to the Borrower's assets for internal use
by Bank One from information furnished to it by or on behalf of the Borrower, after Bank One
has exercised its rights of inspection pursuant to this Agreement. </P>

<P>(ii) The Borrower hereby further agrees to indemnify the Administrative Agent, the Arranger, each
Lender, their respective affiliates, and each of their directors, officers and employees against all
losses, claims, damages, penalties, judgments, liabilities and expenses (including, without
limitation, all expenses of litigation or preparation therefor whether or not the Administrative
Agent, the Arranger, any Lender or any affiliate is a party thereto) which any of them may pay or
incur arising out of or relating to this Agreement, the other Loan Documents, the transactions
contemplated hereby or the direct or indirect application or proposed application of the proceeds
of any Loan hereunder except to the extent that they are determined in a final non-appealable
judgment by a court of competent jurisdiction to have resulted from the gross negligence or
willful misconduct of the party seeking indemnification. The obligations of the Borrower under
this Section 9.6 shall survive the termination of this Agreement. </P>

<P>9.7. Numbers of Documents. All statements, notices, closing documents, and requests hereunder
shall be furnished to the Administrative Agent with sufficient counterparts so that the
Administrative Agent may furnish one to each of the Lenders. </P>

<P>9.8. Accounting. Except as provided to the contrary herein, all accounting terms used herein shall
be interpreted and all accounting determinations hereunder shall be made in accordance with
Agreement Accounting Principles, except that any calculation or determination which is to be
made on a consolidated basis (i) shall be made for the Borrower and all its Subsidiaries, and (ii)
shall exclude any assets, liabilities, revenues and expenses that are included in Borrower's
financial statements from other "variable interest entities" as a result of the application of FIN
No. 46, Consolidation of Variable Interest Entities - an Interpretation of ARB No. 51, as updated
through FIN No. 46-R. For the sake of clarity and the avoidance of doubt, it is understood that
MGE Power West Campus, LLC, which is a subsidiary of MGE Energy, Inc., is consolidated
into the financial statements of the Borrower as a "variable interest entity" under the provisions
of FIN No. 46-R. </P>

<P>9.9. Severability of Provisions. Any provision in any Loan Document that is held to be
inoperative, unenforceable, or invalid in any jurisdiction shall, as to that jurisdiction, be
inoperative, unenforceable, or invalid without affecting the remaining provisions in that
jurisdiction or the operation, enforceability, or validity of that provision in any other jurisdiction,
and to this end the provisions of all Loan Documents are declared to be severable. </P>

<P>9.10. Nonliability of Lenders. The relationship between the Borrower on the one hand and the
Lenders and the Administrative Agent on the other hand shall be solely that of borrower and
lender. Neither the Administrative Agent, the Arranger nor any Lender shall have any fiduciary
responsibilities to the Borrower. Neither the Administrative Agent, the Arranger nor any Lender
undertakes any responsibility to the Borrower to review or inform the Borrower of any matter in
connection with any phase of the Borrower's business or operations. The Borrower agrees that
neither the Administrative Agent, the Arranger nor any Lender shall have liability to the
Borrower (whether sounding in tort, contract or otherwise) for losses suffered by the Borrower in
connection with, arising out of, or in any way related to, the transactions contemplated and the
relationship established by the Loan Documents, or any act, omission or event occurring in
connection therewith, unless it is determined in a final non-appealable judgment by a court of
competent jurisdiction that such losses resulted from the gross negligence or willful misconduct
of the party from which recovery is sought. Neither the Administrative Agent, the Arranger nor
any Lender shall have any liability with respect to, and the Borrower hereby waives, releases and
agrees not to sue for, any special, indirect or consequential damages suffered by the Borrower in
connection with, arising out of, or in any way related to the Loan Documents or the transactions
contemplated thereby. </P>

<P>9.11. Confidentiality. Each Lender agrees to hold any confidential information which it may
receive from the Borrower pursuant to this Agreement or in connection with any inspection
conducted pursuant to Section 6.10 in confidence, except for disclosure (i) to its Affiliates and to
other Lenders and their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory officials, (iv) to any
Person as requested pursuant to or as required by law, regulation, or legal process, (v) to any
Person in connection with any legal proceeding to which such Lender is a party, (vi) to such
Lender's direct or indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, and (vii) permitted by Section
12.4. </P>

<P>9.12. Nonreliance. Each Lender hereby represents that it is not relying on or looking to any
margin stock (as defined in Regulation U of the Board of Governors of the Federal Reserve
System) for the repayment of the Loans provided for herein. </P>

<P>9.13. Disclosure. The Borrower and each Lender hereby acknowledge and agree that Bank One
and/or its Affiliates from time to time may hold investments in, make other loans to or have other
relationships with the Borrower and its Affiliates. </P>

<P ALIGN="CENTER"><strong>ARTICLE X<br>
</strong><strong>THE ADMINISTRATIVE AGENT </strong></P>

<P>10.1. Appointment; Nature of Relationship. Bank One, NA is hereby appointed by each of the
Lenders as its contractual representative (herein referred to as the "Administrative Agent")
hereunder and under each other Loan Document, and each of the Lenders irrevocably authorizes
the Administrative Agent to act as the contractual representative of such Lender with the rights
and duties expressly set forth herein and in the other Loan Documents. The Administrative Agent
agrees to act as such contractual representative upon the express conditions contained in this
Article X. Notwithstanding the use of the defined term "Administrative Agent," it is expressly
understood and agreed that the Administrative Agent shall not have any fiduciary responsibilities
to any Lender by reason of this Agreement or any other Loan Document and that the
Administrative Agent is merely acting as the contractual representative of the Lenders with only
those duties as are expressly set forth in this Agreement and the other Loan Documents. In its
capacity as the Lenders' contractual representative, the Administrative Agent (i) does not hereby
assume any fiduciary duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of the term "secured party" as defined in the Illinois Uniform Commercial Code and
(iii) is acting as an independent contractor, the rights and duties of which are limited to those
expressly set forth in this Agreement and the other Loan Documents. Each of the Lenders hereby
agrees to assert no claim against the Administrative Agent on any agency theory or any other
theory of liability for breach of fiduciary duty, all of which claims each Lender hereby waives. </P>

<P>10.2. Powers. The Administrative Agent shall have and may exercise such powers under the
Loan Documents as are specifically delegated to the Administrative Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The Administrative
Agent shall have no implied duties to the Lenders, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan Documents to be taken by
the Administrative Agent. </P>

<P>10.3. General Immunity. Neither the Administrative Agent nor any of its directors, officers,
agents or employees shall be liable to the Borrower, the Lenders or any Lender for any action
taken or omitted to be taken by it or them hereunder or under any other Loan Document or in
connection herewith or therewith except to the extent such action or inaction is determined in a
final non-appealable judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person. </P>

<P>10.4. No Responsibility for Loans, Recitals, etc. Neither the Administrative Agent nor any of its
directors, officers, agents or employees shall be responsible for or have any duty to ascertain,
inquire into, or verify (a) any statement, warranty or representation made in connection with any
Loan Document or any borrowing hereunder; (b) the performance or observance of any of the
covenants or agreements of any obligor under any Loan Document, including, without limitation,
any agreement by an obligor to furnish information directly to each Lender; (c) the satisfaction of
any condition specified in Article IV, except receipt of items required to be delivered solely to
the Administrative Agent; (d) the existence or possible existence of any Default or Unmatured
Default; (e) the validity, enforceability, effectiveness, sufficiency or genuineness of any Loan
Document or any other instrument or writing furnished in connection therewith; (f) the value,
sufficiency, creation, perfection or priority of any Lien in any collateral security; or (g) the
financial condition of the Borrower or any guarantor of any of the Obligations or of any of the
Borrower's or any such guarantor's respective Subsidiaries. The Administrative Agent shall have
no duty to disclose to the Lenders information that is not required to be furnished by the
Borrower to the Administrative Agent at such time, but is voluntarily furnished by the Borrower
to the Administrative Agent (either in its capacity as Administrative Agent or in its individual
capacity). </P>

<P>10.5. Action on Instructions of Lenders. The Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, hereunder and under any other Loan Document
in accordance with written instructions signed by the Required Lenders, and such instructions
and any action taken or failure to act pursuant thereto shall be binding on all of the Lenders. The
Lenders hereby acknowledge that the Administrative Agent shall be under no duty to take any
discretionary action permitted to be taken by it pursuant to the provisions of this Agreement or
any other Loan Document unless it shall be requested in writing to do so by the Required
Lenders. The Administrative Agent shall be fully justified in failing or refusing to take any action
hereunder and under any other Loan Document unless it shall first be indemnified to its
satisfaction by the Lenders pro rata against any and all liability, cost and expense that it may
incur by reason of taking or continuing to take any such action. </P>

<P>10.6. Employment of Administrative Agents and Counsel. The Administrative Agent may
execute any of its duties as Administrative Agent hereunder and under any other Loan Document
by or through employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized agents, for the default or
misconduct of any such agents or attorneys-in-fact selected by it with reasonable care. The
Administrative Agent shall be entitled to advice of counsel concerning the contractual
arrangement between the Administrative Agent and the Lenders and all matters pertaining to the
Administrative Agent's duties hereunder and under any other Loan Document. </P>

<P>10.7. Reliance on Documents; Counsel. The Administrative Agent shall be entitled to rely upon
any Note, notice, consent, certificate, affidavit, letter, telegram, statement, paper or document
believed by it to be genuine and correct and to have been signed or sent by the proper person or
persons, and, in respect to legal matters, upon the opinion of counsel selected by the
Administrative Agent, which counsel may be employees of the Administrative Agent. </P>

<P>10.8. Administrative Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Administrative Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (i) for any amounts not reimbursed by the
Borrower for which the Administrative Agent is entitled to reimbursement by the Borrower
under the Loan Documents, (ii) for any other expenses incurred by the Administrative Agent on
behalf of the Lenders, in connection with the preparation, execution, delivery, administration and
enforcement of the Loan Documents (including, without limitation, for any expenses incurred by
the Administrative Agent in connection with any dispute between the Administrative Agent and
any Lender or between two or more of the Lenders) and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind and nature whatsoever which may be imposed on, incurred by or asserted against the
Administrative Agent in any way relating to or arising out of the Loan Documents or any other
document delivered in connection therewith or the transactions contemplated thereby (including,
without limitation, for any such amounts incurred by or asserted against the Administrative
Agent in connection with any dispute between the Administrative Agent and any Lender or
between two or more of the Lenders), or the enforcement of any of the terms of the Loan
Documents or of any such other documents, provided that (i) no Lender shall be liable for any of
the foregoing to the extent any of the foregoing is found in a final non-appealable judgment by a
court of competent jurisdiction to have resulted from the gross negligence or willful misconduct
of the Administrative Agent and (ii) any indemnification required pursuant to Section 3.5(vii)
shall, notwithstanding the provisions of this Section 10.8, be paid by the relevant Lender in
accordance with the provisions thereof. The obligations of the Lenders under this Section 10.8
shall survive payment of the Obligations and termination of this Agreement. </P>

<P>10.9. Notice of Default. The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Unmatured Default hereunder unless the
Administrative Agent has received written notice from a Lender or the Borrower referring to this
Agreement describing such Default or Unmatured Default and stating that such notice is a
"notice of default". In the event that the Administrative Agent receives such a notice, the
Administrative Agent shall give prompt notice thereof to the Lenders. </P>

<P>10.10. Rights as a Lender. In the event the Administrative Agent is a Lender, the Administrative
Agent shall have the same rights and powers hereunder and under any other Loan Document with
respect to its Commitment and its Loans as any Lender and may exercise the same as though it
were not the Administrative Agent, and the term "Lender" or "Lenders" shall, at any time when
the Administrative Agent is a Lender, unless the context otherwise indicates, include the
Administrative Agent in its individual capacity. The Administrative Agent and its Affiliates may
accept deposits from, lend money to, and generally engage in any kind of trust, debt, equity or
other transaction, in addition to those contemplated by this Agreement or any other Loan
Document, with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. The Administrative
Agent, in its individual capacity, is not obligated to remain a Lender. </P>

<P>10.11. Lender Credit Decision. Each Lender acknowledges that it has, independently and without
reliance upon the Administrative Agent, the Arranger or any other Lender and based on the
financial statements prepared by the Borrower and such other documents and information as it
has deemed appropriate, made its own credit analysis and decision to enter into this Agreement
and the other Loan Documents. Each Lender also acknowledges that it will, independently and
without reliance upon the Administrative Agent, the Arranger 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 and the other Loan
Documents. Except for any notice, report, document or other information expressly required to
be furnished to the Lenders by the Administrative Agent or Arranger hereunder, neither the
Administrative Agent nor the Arranger shall have any duty or responsibility (either initially or on
a continuing basis) to provide any Lender with any notice, report, document, credit information
or other information concerning the affairs, financial condition or business of the Borrower or
any of its Affiliates that may come into the possession of the Administrative Agent or Arranger
(whether or not in their respective capacity as Administrative Agent or Arranger) or any of their
Affiliates. </P>

<P>10.12. Successor Administrative Agent. The Administrative Agent may resign at any time by
giving written notice thereof to the Lenders and the Borrower, such resignation to be effective
upon the appointment of a successor Administrative Agent or, if no successor Administrative
Agent has been appointed, forty-five days after the retiring Administrative Agent gives notice of
its intention to resign. The Administrative Agent may be removed at any time with or without
cause by written notice received by the Administrative Agent from the Required Lenders, such
removal to be effective on the date specified by the Required Lenders. Upon any such resignation
or removal, the Required Lenders shall have the right to appoint, on behalf of the Borrower and
the Lenders, a successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed by the Required Lenders within thirty days after the resigning Administrative
Agent's giving notice of its intention to resign, then the resigning Administrative Agent may
appoint, on behalf of the Borrower and the Lenders, a successor Administrative Agent.
Notwithstanding the previous sentence, the Administrative Agent may at any time without the
consent of the Borrower or any Lender, appoint any of its Affiliates which is a commercial bank
as a successor Administrative Agent hereunder. If the Administrative Agent has resigned or been
removed and no successor Administrative Agent has been appointed, the Lenders may perform
all the duties of the Administrative Agent hereunder and the Borrower shall make all payments in
respect of the Obligations to the applicable Lender and for all other purposes shall deal directly
with the Lenders. No successor Administrative Agent shall be deemed to be appointed hereunder
until such successor Administrative Agent has accepted the appointment. Any such successor
Administrative Agent shall be a commercial bank having capital and retained earnings of at least
$100,000,000. Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the resigning or removed
Administrative Agent. Upon the effectiveness of the resignation or removal of the Administrative
Agent, the resigning or removed Administrative Agent shall be discharged from its duties and
obligations hereunder and under the Loan Documents. After the effectiveness of the resignation
or removal of an Administrative Agent, the provisions of this Article X shall continue in effect
for the benefit of such Administrative Agent in respect of any actions taken or omitted to be
taken by it while it was acting as the Administrative Agent hereunder and under the other Loan
Documents. In the event that there is a successor to the Administrative Agent by merger, or the
Administrative Agent assigns its duties and obligations to an Affiliate pursuant to this Section
10.12, then the term "Prime Rate" as used in this Agreement shall mean the prime rate, base rate
or other analogous rate of the new Administrative Agent. </P>

<P>10.13. Administrative Agent and Arranger Fees. The Borrower agrees to pay to the
Administrative Agent and the Arranger, for their respective accounts, the fees agreed to by the
Borrower, the Administrative Agent and the Arranger from time to time. </P>

<P>10.14. Delegation to Affiliates. The Borrower and the Lenders agree that the Administrative
Agent may delegate any of its duties under this Agreement to any of its Affiliates. Any such
Affiliate (and such Affiliate's directors, officers, agents and employees) which performs duties in
connection with this Agreement shall be entitled to the same benefits of the indemnification,
waiver and other protective provisions to which the Administrative Agent is entitled under
Articles IX and X. </P>

<P>10.15. Other Agents. The Syndication Agent and the Managing Agents, in the respective
capacities as such, shall not have any duties or obligations of any kind under this Agreement. </P>

<P ALIGN="CENTER"><strong>ARTICLE XI<br>
</strong><strong>SETOFF; RATABLE PAYMENTS </strong></P>

<P>11.1. Setoff. In addition to, and without limitation of, any rights of the Lenders under applicable
law, if the Borrower becomes insolvent, however evidenced, or any Default occurs, any and all
deposits (including all account balances, whether provisional or final and whether or not
collected or available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may be offset and
applied toward the payment of the Obligations owing to such Lender, whether or not the
Obligations, or any part thereof, shall then be due. </P>

<P>11.2. Ratable Payments. If any Lender, whether by setoff or otherwise, has payment made to it
upon its Loans (other than payments received pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater
proportion than that received by any other Lender, such Lender agrees, promptly upon demand,
to purchase a portion of the Loans held by the other Lenders so that after such purchase each
Lender will hold its ratable proportion of Loans. If any Lender, whether in connection with setoff
or amounts which might be subject to setoff or otherwise, receives collateral or other protection
for its Obligations or such amounts which may be subject to setoff, such Lender agrees, promptly
upon demand, to take such action necessary such that all Lenders share in the benefits of such
collateral ratably in proportion to their Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made. </P>

<P ALIGN="CENTER"><strong>ARTICLE XII<br>
</strong><strong>BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS </strong></P>

<P>12.1. Successors and Assigns. The terms and provisions of the Loan Documents shall be binding
upon and inure to the benefit of the Borrower and the Lenders and their respective successors and
assigns, except that (i) the Borrower shall not have the right to assign its rights or obligations
under the Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. The parties to this Agreement acknowledge that clause (ii) of this Section 12.1
relates only to absolute assignments and does not prohibit assignments creating security interests,
including, without limitation, (x) any pledge or assignment by any Lender of all or any portion of
its rights under this Agreement and any Note to a Federal Reserve Bank or (y) in the case of a
Lender which is a Fund, any pledge or assignment of all or any portion of its rights under this
Agreement and any Note to its trustee in support of its obligation to its trustees; provided,
however, that no such pledge or assignment creating a security interest shall release the transferor
Lender from its obligations hereunder unless and until the parties thereto have complied with the
provisions of Section 12.3. The Administrative Agent may treat the Person which made any Loan
or which holds any Note as the owner thereof for all purposes hereof unless and until such Person
complies with Section 12.3; provided, however, that the Administrative Agent may in its
discretion (but shall not be required to) follow instructions from the Person which made any
Loan or which holds any Note to direct payments relating to such Loan or Note to another
Person. Any assignee of the rights to any Loan or any Note agrees by acceptance of such
assignment to be bound by all the terms and provisions of the Loan Documents. Any request,
authority or consent of any Person, who at the time of making such request or giving such
authority or consent is the owner of the rights to any Loan (whether or not a Note has been issued
in evidence thereof), shall be conclusive and binding on any subsequent holder or assignee of the
rights to such Loan. </P>

<P>12.2. Participations. </P>

<P>12.2.1. Permitted Participants; Effect. Any Lender may at any time sell to one or more banks or
other entities ("Participants") participating interests in any Loan owing to such Lender, any Note
held by such Lender, any Commitment of such Lender or any other interest of such Lender under
the Loan Documents. In the event of any such sale by a Lender of participating interests to a
Participant, such Lender's obligations under the Loan Documents shall remain unchanged, such
Lender shall remain solely responsible to the other parties hereto for the performance of such
obligations, such Lender shall remain the owner of its Loans and the holder of any Note issued to
it in evidence thereof for all purposes under the Loan Documents, all amounts payable by the
Borrower under this Agreement shall be determined as if such Lender had not sold such
participating interests, and the Borrower and the Administrative Agent shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and obligations
under the Loan Documents. </P>

<P>12.2.2. Voting Rights. Each Lender shall retain the sole right to approve, without the consent of
any Participant, any amendment, modification or waiver of any provision of the Loan Documents
other than any amendment, modification or waiver with respect to any Loan or Commitment in
which such Participant has an interest which would require consent of all of the Lenders pursuant
to the terms of Section 8.2 or of any other Loan Document. </P>

<P>12.2.3. Benefit of Setoff. The Borrower agrees that each Participant shall be deemed to have the
right of setoff provided in Section 11.1 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its participating interest were
owing directly to it as a Lender under the Loan Documents, provided that each Lender shall
retain the right of setoff provided in Section 11.1 with respect to the amount of participating
interests sold to each Participant. The Lenders agree to share with each Participant, and each
Participant, by exercising the right of setoff provided in Section 11.1, agrees to share with each
Lender, any amount received pursuant to the exercise of its right of setoff, such amounts to be
shared in accordance with Section 11.2 as if each Participant were a Lender. </P>

<P>12.3. Assignments. </P>

<P>12.3.1. Permitted Assignments. Any Lender may at any time assign to one or more banks or other
entities ("Purchasers") all or any part of its rights and obligations under the Loan Documents.
Such assignment shall be substantially in the form of Exhibit C or in such other form as may be
agreed to by the parties thereto. The consent of the Borrower and the Administrative Agent shall
be required prior to an assignment becoming effective with respect to a Purchaser which is not a
Lender or an Affiliate thereof; provided, however, that if a Default has occurred and is
continuing, the consent of the Borrower shall not be required. Such consent shall not be
unreasonably withheld or delayed. Each such assignment with respect to a Purchaser which is not
a Lender or an Affiliate thereof shall (unless each of the Borrower and the Administrative Agent
otherwise consents) be in an amount not less than the lesser of (i) $5,000,000 or (ii) the
remaining amount of the assigning Lender's Commitment (calculated as at the date of such
assignment) or outstanding Loans (if the applicable Commitment has been terminated). </P>

<P>12.3.2. Effect; Effective Date. Upon (i) delivery to the Administrative Agent of an assignment,
together with any consents required by Section 12.3.1, and (ii) payment of a $4,000 fee to the
Administrative Agent for processing such assignment (unless such fee is waived by the
Administrative Agent), such assignment shall become effective on the effective date specified in
such assignment. The assignment shall contain a representation by the Purchaser to the effect that
none of the consideration used to make the purchase of the Commitment and Loans under the
applicable assignment agreement constitutes "plan assets" as defined under ERISA and that the
rights and interests of the Purchaser in and under the Loan Documents will not be "plan assets"
under ERISA. On and after the effective date of such assignment, such Purchaser shall for all
purposes be a Lender party to this Agreement and any other Loan Document executed by or on
behalf of the Lenders and shall have all the rights and obligations of a Lender under the Loan
Documents, to the same extent as if it were an original party hereto, and no further consent or
action by the Borrower, the Lenders or the Administrative Agent shall be required to release the
transferor Lender with respect to the percentage of the Aggregate Commitment and Loans
assigned to such Purchaser. Upon the consummation of any assignment to a Purchaser pursuant
to this Section 12.3.2, the transferor Lender, the Administrative Agent and the Borrower shall, if
the transferor Lender or the Purchaser desires that its Loans be evidenced by Notes, make
appropriate arrangements so that new Notes or, as appropriate, replacement Notes are issued to
such transferor Lender and new Notes or, as appropriate, replacement Notes, are issued to such
Purchaser, in each case in principal amounts reflecting their respective Commitments, as adjusted
pursuant to such assignment. </P>

<P>12.3.3. Register. The Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at one of its offices in the United States a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and addresses of the
Lenders, and the Commitments of, and principal amounts of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall
be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower at any reasonable time and from time
to time upon reasonable prior notice. </P>

<P>12.4. Dissemination of Information. The Borrower authorizes each Lender to disclose to any
Participant or Purchaser or any other Person acquiring an interest in the Loan Documents by
operation of law (each a "Transferee") and any prospective Transferee any and all information in
such Lender's possession concerning the creditworthiness of the Borrower and its Subsidiaries,
including without limitation any information contained in any Reports; provided that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this Agreement. </P>

<P>12.5. Tax Treatment. If any interest in any Loan Document is transferred to any Transferee which
is organized under the laws of any jurisdiction other than the United States or any State thereof,
the transferor Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 3.5(iv). </P>

<P ALIGN="CENTER"><strong>ARTICLE XIII<br>
</strong><strong>NOTICES </strong></P>

<P>13.1. Notices. Except as otherwise permitted by Section 2.14 with respect to borrowing notices,
all notices, requests and other communications to any party hereunder shall be in writing
(including electronic transmission, facsimile transmission or similar writing) and shall be given
to such party: (x) in the case of the Borrower or the Administrative Agent, at its address or
facsimile number set forth on the signature pages hereof, (y) in the case of any Lender, at its
address or facsimile number set forth in its administrative questionnaire delivered to the
Administrative Agent or (z) in the case of any party, at such other address or facsimile number as
such party may hereafter specify for the purpose by notice to the Administrative Agent and the
Borrower in accordance with the provisions of this Section 13.1. Each such notice, request or
other communication shall be effective (i) if given by facsimile transmission, when transmitted to
the facsimile number specified in this Section and confirmation of receipt is received, (ii) if given
by mail, 72 hours after such communication is deposited in the mails with first class postage
prepaid, addressed as aforesaid, or (iii) if given by any other means, when delivered (or, in the
case of electronic transmission, received) at the address specified in this Section; provided that
notices to the Administrative Agent under Article II shall not be effective until received. </P>

<P>13.2. Electronic Communications. Notices and other communications to the Lenders may be
delivered or furnished by electronic communication (including e-mail and internet or intranet
websites) pursuant to procedures approved by the Administrative Agent or as otherwise
determined by the Administrative Agent, provided that the foregoing shall not apply to notices to
any Lender pursuant to Article II if such Lender has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic communication. The
Administrative Agent or the Borrower may, in its respective discretion, agree to accept notices
and other communications to it hereunder by electronic communications pursuant to procedures
approved by it or as it otherwise determines, provided that such determination or approval may
be limited to particular notices or communications. </P>

<P>Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent
to an e-mail address shall be deemed received upon the sender's receipt of an acknowledgement
from the intended recipient (such as by the "return receipt requested" function, as available,
return e-mail or other written acknowledgement), provided that if such notice or other
communication is not given during the normal business hours of the recipient, such notice or
communication shall be deemed to have been given at the opening of business on the next
Business Day for the recipient, and (ii) notices or communications posted to an Internet or
intranet website shall be deemed received upon the deemed receipt by the intended recipient at its
e-mail address as described in the foregoing clause (i) of notification that such notice or
communication is available and identifying the website address therefor.</P>

<P>13.3. Change of Address. The Borrower, the Administrative Agent and any Lender may each
change the address for service of notice upon it by a notice in writing to the other parties hereto. </P>

<P ALIGN="CENTER"><strong>ARTICLE XIV<br>
</strong><strong>COUNTERPARTS; EFFECTIVENESS; TERMINATION OF EXISTING AGREEMENT </strong></P>

<P>This Agreement may be executed in any number of counterparts, all of which taken together shall
constitute one agreement, and any of the parties hereto may execute this Agreement by signing
any such counterpart. This Agreement shall become effective when (a) it has been executed by
the Borrower, the Administrative Agent and the Lenders and each party has notified the
Administrative Agent by facsimile transmission or telephone that it has taken such action and (b)
the Borrower has paid all outstanding fees and other amounts payable by the Borrower under the
Existing Credit Agreements. </P>

<P ALIGN="CENTER"><strong>ARTICLE XV<br>
</strong><strong>CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL </strong></P>

<P>15.1. CHOICE OF LAW. <strong>THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING
A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF WISCONSIN, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS. </strong></P>

<P>15.2. WAIVER OF JURY TRIAL. <strong>THE BORROWER, THE ADMINISTRATIVE AGENT
AND EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER
SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY ARISING OUT OF,
RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER. </strong></P>

<P>IN WITNESS WHEREOF, the Borrower, the Lenders and the Administrative Agent have
executed this Agreement as of the date first above written.</P>

<P>MADISON GAS AND ELECTRIC COMPANY</P>

<P>By:<br>
Title: Vice President and Treasurer<br>
133 S. Blair St.<br>
Madison, WI 53701<br>
Attention: Vice President and Treasurer<br>
Telephone: 608-252-7149<br>
Fax: 608-252-7098</P>

<P>Commitment<br>
$15,000,000.00<br>
BANK ONE, NA, as Administrative Agent and a Lender<br>
By:<br>
Title:<br>
1 Bank One Plaza<br>
Chicago, Illinois 60670<br>
Attention: Bob Bussa<br>
Telephone: 312-325-3008<br>
Fax: 312-325-3030</P>

<P>Commitment<br>
$12,500,000.00<br>
U.S. BANK NATIONAL ASSOCIATION, as Syndication Agent and a Lender<br>
By:<br>
Title:<br>
<br>
Commitment<br>
$10,000,000.00<br>
MARSHALL &amp; ILSLEY BANK as a Managing Agent and a Lender<br>
By:<br>
Title:<br>
<br>
Commitment<br>
$7,500,000.00<br>
ASSOCIATED BANK, N.A., as a Managing Agent and a Lender<br>
By:<br>
Title: </P>
<P><strong>PRICING SCHEDULE</strong></P>

<TABLE BORDER CELLSPACING=1 BORDERCOLOR="#000000" CELLPADDING=8 WIDTH=727>
  <TR>
    <TD WIDTH="21%" VALIGN="TOP" BGCOLOR="#c0c0c0"><P ALIGN="JUSTIFY"><b>Applicable<br>
    </b><b>Margin</b></P>
    </TD>
    <TD WIDTH="19%" VALIGN="TOP" BGCOLOR="#c0c0c0"><P ALIGN="JUSTIFY"><b>Level I<br>
    </b><b>Status</b></P>
    </TD>
    <TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#c0c0c0"><P ALIGN="JUSTIFY"><b>Level II<br>
    </b><b>Status</b></P>
    </TD>
    <TD WIDTH="14%" VALIGN="TOP" BGCOLOR="#c0c0c0"><P ALIGN="JUSTIFY"><b>Level III<br>
    </b><b>Status</b></P>
    </TD>
    <TD WIDTH="15%" VALIGN="TOP" BGCOLOR="#c0c0c0"><P ALIGN="JUSTIFY"><b>Level IV<br>
    </b><b>Status</b></P>
    </TD>
    <TD WIDTH="17%" VALIGN="TOP" BGCOLOR="#c0c0c0"><P ALIGN="JUSTIFY"><b>Level V<br>
    </b><b>Status</b></P>
    </TD>
  </TR>
  <TR>
    <TD WIDTH="21%" VALIGN="TOP"><P ALIGN="JUSTIFY">Eurodollar Rate</TD>
    <TD WIDTH="19%" VALIGN="TOP"><P ALIGN="JUSTIFY">0.42%</TD>
    <TD WIDTH="14%" VALIGN="TOP"><P ALIGN="JUSTIFY">0.46%</TD>
    <TD WIDTH="14%" VALIGN="TOP"><P ALIGN="JUSTIFY">0.49%</TD>
    <TD WIDTH="15%" VALIGN="TOP"><P ALIGN="JUSTIFY">0.595%</TD>
    <TD WIDTH="17%" VALIGN="TOP"><P ALIGN="JUSTIFY">0.80%</TD>
  </TR>
  <TR>
    <TD WIDTH="21%" VALIGN="TOP"><P ALIGN="JUSTIFY">Floating Rate</TD>
    <TD WIDTH="19%" VALIGN="TOP"><P ALIGN="JUSTIFY">0%</TD>
    <TD WIDTH="14%" VALIGN="TOP"><P ALIGN="JUSTIFY">0%</TD>
    <TD WIDTH="14%" VALIGN="TOP"><P ALIGN="JUSTIFY">0%</TD>
    <TD WIDTH="15%" VALIGN="TOP"><P ALIGN="JUSTIFY">0%</TD>
    <TD WIDTH="17%" VALIGN="TOP"><P ALIGN="JUSTIFY">0%</TD>
  </TR>
</TABLE>
<br>
<table border cellspacing=1 bordercolor="#000000" cellpadding=8 width=730>
  <tr>
    <td width="21%" valign="TOP" bgcolor="#c0c0c0"><p align="JUSTIFY"><b>Applicable Fee<br>
    </b><b>Rate</b></p></td>
    <td width="18%" valign="TOP" bgcolor="#c0c0c0"><p align="JUSTIFY"><b>Level I<br>
    </b><b>Status</b></p></td>
    <td width="15%" valign="TOP" bgcolor="#c0c0c0"><p align="JUSTIFY"><b>Level II<br>
    </b><b>Status</b></p></td>
    <td width="14%" valign="TOP" bgcolor="#c0c0c0"><p align="JUSTIFY"><b>Level III<br>
    </b><b>Status</b></p></td>
    <td width="14%" valign="TOP" bgcolor="#c0c0c0"><p align="JUSTIFY"><b>Level IV<br>
    </b><b>Status</b></p></td>
    <td width="17%" valign="TOP" bgcolor="#c0c0c0"><p align="JUSTIFY"><b>Level V<br>
    </b><b>Status</b></p></td>
  </tr>
  <tr>
    <td width="21%" valign="TOP"><p align="JUSTIFY">Facility Fee</td>
    <td width="18%" valign="TOP"><p align="JUSTIFY">0.08%</td>
    <td width="15%" valign="TOP"><p align="JUSTIFY">0.09%</td>
    <td width="14%" valign="TOP"><p align="JUSTIFY">0.11%</td>
    <td width="14%" valign="TOP"><p align="JUSTIFY">0.13%</td>
    <td width="17%" valign="TOP"><p align="JUSTIFY">0.175%</td>
  </tr>
</table>
<p>For the purposes of this Schedule, the following terms have the following meanings, subject to
the final paragraph of this Schedule:</p>
<P>"Level I Status" exists at any date if, on such date, the Borrower's Moody's Rating is Aa2 or
better or the Borrower's S&amp;P Rating is AA or better.</P>

<P>"Level II Status" exists at any date if, on such date, (i) the Borrower has not qualified for Level I
Status and (ii) the Borrower's Moody's Rating is Aa3 or better or the Borrower's S&amp;P Rating is
AA- or better.</P>

<P>"Level III Status" exists at any date if, on such date, (i) the Borrower has not qualified for Level I
Status or Level II Status and (ii) the Borrower's Moody's Rating is A1 or better or the
Borrower's S&amp;P Rating is A+ or better.</P>

<P>"Level IV Status" exists at any date if, on such date, (i) the Borrower has not qualified for Level I
Status, Level II Status or Level III Status and (ii) the Borrower's Moody's Rating is A2 or better
or the Borrower's S&amp;P Rating is A or better.</P>

<P>"Level V Status" exists at any date if, on such date, the Borrower has not qualified for Level I
Status, Level II Status, Level III Status or Level IV Status.</P>

<P>"Moody's Rating" means, at any time, the rating issued by Moody's and then in effect with
respect to the Borrower's senior unsecured long-term debt securities without third-party credit
enhancement.</P>

<P>"S&amp;P Rating" means, at any time, the rating issued by S&amp;P and then in effect with respect to the
Borrower's senior unsecured long-term debt securities without third-party credit enhancement.</P>

<P>"Status" means either Level I Status, Level II Status, Level III Status, Level IV Status or Level V
Status.</P>

<P>The Applicable Margin and Applicable Fee Rate shall be determined in accordance with the
foregoing table based on the Borrower's Status as determined from its then-current Moody's and
S&amp;P Ratings. The credit rating in effect on any date for the purposes of this Schedule is that in
effect at the close of business on such date. If at any time the Borrower has no Moody's Rating or
no S&amp;P Rating, Level V Status shall exist. If the Borrower is split-rated and the ratings
differential is one level, the higher rating will apply. If the Borrower is split-rated and the ratings
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.</P>

<P><strong>Schedule I</strong></P>

<P><strong>EXISTING CREDIT AGREEMENTS</strong><br>
Lender____________________ Dollar Amount<br>
Bank One, Wisconsin $23,000,000<br>
M&amp;I Bank 7,000,000<br>
U.S. Bank 10,000,000<br>
Total $40,000,000</P>

<P><strong>EXHIBIT A</strong><br>
FORM OF OPINION</P>

<P><strong>EXHIBIT B</strong><br>
COMPLIANCE CERTIFICATE</P>

<P>To: The Lenders parties to the Credit Agreement Described Below</P>

<P>This Compliance Certificate is furnished pursuant to that certain Credit Agreement dated as of
July 14, 2004 (as amended, modified, renewed or extended from time to time, the "Agreement")
among Madison Gas and Electric Company (the "Borrower"), the lenders party thereto and Bank
One, NA, as Administrative Agent for the Lenders. Unless otherwise defined herein, capitalized
terms used in this Compliance Certificate have the meanings ascribed thereto in the Agreement.</P>

<P>THE UNDERSIGNED HEREBY CERTIFIES THAT:</P>

<P>1. I am the duly elected __________ of the Borrower; </P>

<P>2. I have reviewed the terms of the Agreement and I have made, or have caused to be made under
my supervision, a detailed review of the transactions and conditions of the Borrower and its
Subsidiaries during the accounting period covered by the attached financial statements; </P>

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

<P>4. Schedule I attached hereto sets forth financial data and computations evidencing the
Borrower's compliance with certain covenants of the Agreement, all of which data and
computations are true, complete and correct. </P>

<P>**[5. Schedule II attached hereto sets forth the various reports and deliveries which are required
at this time under the Credit Agreement and the other Loan Documents and the status of
compliance.]**</P>

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

<P>The foregoing certifications, together with the computations set forth in Schedule I hereto and the
financial statements delivered with this Certificate in support hereof, are made and delivered this
   day _____ of _____.               </P>

<P>SCHEDULE I TO COMPLIANCE CERTIFICATE<br>
Compliance as of _________, ____ with Provisions of ____ and ______ of the Agreement.</P>

<P>SCHEDULE II TO COMPLIANCE CERTIFICATE<br>
Reports and Deliveries Currently Due</P>

<P><strong>EXHIBIT C</strong></P>

<P>ASSIGNMENT AGREEMENT</P>

<P>This Assignment Agreement (this "Assignment Agreement") between (the "Assignor") and (the
"Assignee") is dated as of , . The parties hereto agree as follows:</P>

<P>1. PRELIMINARY STATEMENT. The Assignor is a party to a Credit Agreement (which, as it
may be amended, modified, renewed or extended from time to time is herein called the "Credit
Agreement") described in Item 1 of Schedule 1 attached hereto ("Schedule 1"). Capitalized terms
used herein and not otherwise defined herein shall have the meanings attributed to them in the
Credit Agreement. </P>

<P>2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to the Assignee,
and the Assignee hereby purchases and assumes from the Assignor, an interest in and to the
Assignor's rights and obligations under the Credit Agreement and the other Loan Documents,
such that after giving effect to such assignment the Assignee shall have purchased pursuant to
this Assignment Agreement the percentage interest specified in Item 3 of Schedule 1 of all
outstanding rights and obligations under the Credit Agreement and the other Loan Documents
relating to the facilities listed in Item 3 of Schedule 1. The Aggregate Commitment (or Loans, if
the applicable Commitment has been terminated) purchased by the Assignee hereunder is set
forth in Item 4 of Schedule 1. </P>

<P>3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the "Effective Date")
shall be the later of the date specified in Item 5 of Schedule 1 or two Business Days (or such
shorter period agreed to by the Administrative Agent) after this Assignment Agreement, together
with any consents required under the Credit Agreement, are delivered to the Administrative
Agent. In no event will the Effective Date occur if the payments required to be made by the
Assignee to the Assignor on the Effective Date are not made on the proposed Effective Date. </P>

<P>4. PAYMENT OBLIGATIONS. In consideration for the sale and assignment of Loans hereunder,
the Assignee shall pay the Assignor, on the Effective Date, the amount agreed to by the Assignor
and the Assignee. On and after the Effective Date, the Assignee shall be entitled to receive from
the Administrative Agent all payments of principal, interest and fees with respect to the interest
assigned hereby. The Assignee will promptly remit to the Assignor any interest on Loans and
fees received from the Administrative Agent which relate to the portion of the Commitment or
Loans assigned to the Assignee hereunder for periods prior to the Effective Date and not
previously paid by the Assignee to the Assignor. In the event that either party hereto receives any
payment to which the other party hereto is entitled under this Assignment Agreement, then the
party receiving such amount shall promptly remit it to the other party hereto. </P>

<P>5. RECORDATION FEE. The Assignor and Assignee each agree to pay one-half of the
recordation fee required to be paid to the Administrative Agent in connection with this
Assignment Agreement unless otherwise specified in Item 6 of Schedule 1. </P>

<P>6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that (i) it is the legal and beneficial owner of
the interest being assigned by it hereunder, (ii) such interest is free and clear of any adverse claim
created by the Assignor and (iii) the execution and delivery of this Assignment Agreement by the
Assignor is duly authorized. It is understood and agreed that the assignment and assumption
hereunder are made without recourse to the Assignor and that the Assignor makes no other
representation or warranty of any kind to the Assignee. Neither the Assignor nor any of its
officers, directors, employees, agents or attorneys shall be responsible for (i) the due execution,
legality, validity, enforceability, genuineness, sufficiency or collectability of any Loan Document,
including without limitation, documents granting the Assignor and the other Lenders a security
interest in assets of the Borrower or any guarantor, (ii) any representation, warranty or statement
made in or in connection with any of the Loan Documents, (iii) the financial condition or
creditworthiness of the Borrower or any guarantor, (iv) the performance of or compliance with
any of the terms or provisions of any of the Loan Documents, (v) inspecting any of the property,
books or records of the Borrower, (vi) the validity, enforceability, perfection, priority, condition,
value or sufficiency of any collateral securing or purporting to secure the Loans or (vii) any
mistake, error of judgment, or action taken or omitted to be taken in connection with the Loans or
the Loan Documents. </P>

<P>7. REPRESENTATIONS AND UNDERTAKINGS OF THE ASSIGNEE. The Assignee (i)
confirms that it has received a copy of the Credit Agreement, together with copies of the
financial statements requested by the Assignee and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter into this
Assignment Agreement, (ii) agrees that it will, independently and without reliance upon the
Administrative Agent, the Assignor or any other Lender and based on such documents and
information at it shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, (iii) appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise such powers
under the Loan Documents as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are reasonably incidental thereto, (iv) confirms that the execution
and delivery of this Assignment Agreement by the Assignee is duly authorized, (v) agrees that it
will perform in accordance with their terms all of the obligations which by the terms of the Loan
Documents are required to be performed by it as a Lender, (vi) agrees that its payment
instructions and notice instructions are as set forth in the attachment to Schedule 1, (vii) confirms
that none of the funds, monies, assets or other consideration being used to make the purchase and
assumption hereunder are "plan assets" as defined under ERISA and that its rights, benefits and
interests in and under the Loan Documents will not be "plan assets" under ERISA, (viii) agrees to
indemnify and hold the Assignor harmless against all losses, costs and expenses (including,
without limitation, reasonable attorneys' fees) and liabilities incurred by the Assignor in
connection with or arising in any manner from the Assignee's non-performance of the
obligations assumed under this Assignment Agreement, and (ix) if applicable, attaches the forms
prescribed by the Internal Revenue Service of the United States certifying that the Assignee is
entitled to receive payments under the Loan Documents without deduction or withholding of any
United States federal income taxes. </P>

<P>8. GOVERNING LAW. This Assignment Agreement shall be governed by the internal law, and
not the law of conflicts, of the State of Wisconsin. </P>

<P>9. NOTICES. Notices shall be given under this Assignment Agreement in the manner set forth in
the Credit Agreement. For the purpose hereof, the addresses of the parties hereto (until notice of
a change is delivered) shall be the address set forth in the attachment to Schedule 1. </P>

<P>10. COUNTERPARTS; DELIVERY BY FACSIMILE. This Assignment Agreement may be
executed in counterparts. Transmission by facsimile of an executed counterpart of this
Assignment Agreement shall be deemed to constitute due and sufficient delivery of such
counterpart and such facsimile shall be deemed to be an original counterpart of this Assignment
Agreement. </P>

<P>IN WITNESS WHEREOF, the duly authorized officers of the parties hereto have executed this
Assignment Agreement by executing Schedule 1 hereto as of the date first above written.</P>

<P>SCHEDULE 1
to Assignment Agreement</P>

<P>1. Description and Date of Credit Agreement:
Credit Agreement dated as of July 14, 2004 among Madison Gas and Electric Company, the Lenders party thereto and Bank One, NA
as Administrative Agent </P>

<P>2. Date of Assignment Agreement: ______,__ </P>

<P>3. Amounts (As of Date of Item 2 above): </P>

<P>a. Assignee's percentage of the Facility purchased under the Assignment Agreement** ____%  <br>
  <br>
b. Amount of the Facility purchased under the Assignment Agreement*** $___ </P>

<P>4. Assignee's Commitment (or Loans with respect to terminated Commitments) purchased
hereunder: $_________ </P>

<P>5. Proposed Effective Date: _______________ </P>

<P>6. Non-standard Recordation Fee Arrangement<br>
  N/A***<br>
  [Assignor/Assignee to pay 100% of fee]<br>
[Fee waived by Administrative Agent] </P>

<P>Accepted and Agreed:</P>

<P>[NAME OF ASSIGNOR]<br>
  By:<br>
Title:</P>

<P> [NAME OF ASSIGNEE]<br>
By:<br>
Title:</P>
<P> ACCEPTED AND CONSENTED TO**** BY<br>
MADISON GAS AND ELECTRIC COMPANY <br>
By:<br>
Title:</P>
<P>
  ACCEPTED AND CONSENTED TO**BY<br>
BANK ONE, NA, as Administrative Agent<br>
By:<br>
Title:</P>
<P>** Percentage taken to 10 decimal places<br>
*** If fee is split 50-50, pick N/A as option<br>
**** Delete if not required by Credit Agreement</P>
<P>Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT</P>

<P>ADMINISTRATIVE INFORMATION SHEET<br>
  Attach Assignor's Administrative Information Sheet, which must include notice addresses for the Assignor and the Assignee<br>
(Sample form shown below)</P>

<P>ASSIGNOR INFORMATION<br>
  Contact:<br>
Name:<br>
Telephone No.:<br>
Fax No.:<br>
Telex No.:<br>
Answerback:</P>
<P>Payment Information:<br>
  Name &amp; ABA # of Destination Bank:<br>
  Account Name &amp; Number for Wire Transfer:<br>
  Other Instructions: </P>
<P>Address for Notices for Assignor: </P>

<P>ASSIGNEE INFORMATION<br>
  Credit Contact:<br>
Name:<br>
Telephone No.:<br>
Fax No.:<br>
Telex No.:<br>
Answerback: </P>

<P>Key Operations Contacts:<br>
Booking Installation:<br>
Name:<br>
Telephone No.:<br>
Fax No.:<br>
Telex No.:<br>
Answerback:</P>

<P>Payment Information:<br>
Name &amp; ABA # of Destination Bank:<br>
Account Name &amp; Number for Wire Transfer:<br>
Other Instructions: </P>

<P>Address for Notices for Assignee: </P>

<P>BANK ONE INFORMATION<br>
Assignee will be called promptly upon receipt of the signed agreement.</P>

<P>Initial Funding Contact:<br>
Name:<br>
Telephone No.: (312)<br>
Fax No.:  (312)</P>
<P> Subsequent Operations Contact:<br>
Name:<br>
Telephone No.: (312)<br>
Fax No.:  (312)<br>
Bank One Telex No.: 190201  (Answerback: FNBC UT)</P>
<P>Initial Funding Standards:<br>
Libor - Fund 2 days after rates are set.</P>

<P>Bank One Wire Instructions:<br>
Bank One, NA, ABA # ___________________ <br>
LS2 Incoming Account #_____________________<br>
Ref:________________</P>

<P>Address for Notices for Bank One:<br>
1 Bank One Plaza, Chicago, IL 60670<br>
Attn: Agency Compliance Division, Suite IL1-0353<br>
Fax No. (312) 732-2038 or (312) 732-4339</P>

<P><strong>EXHIBIT D</strong></P>

<P>LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION</P>

<P>To Bank One, NA,
as Administrative Agent (the "Administrative Agent") under the Credit Agreement
Described Below.</P>

<P>Re: Credit Agreement, dated as of July 14, 2004 (as the same may be amended or modified, the
"Credit Agreement"), among Madison Gas and Electric Company (the "Borrower"), the Lenders
named therein and the Administrative Agent. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned thereto in the Credit Agreement.</P>

<P>The Administrative Agent is specifically authorized and directed to act upon the following
standing money transfer instructions with respect to the proceeds of Advances or other
extensions of credit from time to time until receipt by the Administrative Agent of a specific
written revocation of such instructions by the Borrower, provided, however, that the
Administrative Agent may otherwise transfer funds as hereafter directed in writing by the
Borrower in accordance with Section 13.1 of the Credit Agreement or based on any telephonic
notice made in accordance with Section 2.11 of the Credit Agreement.</P>

<P>Facility Identification Number(s)<br>
Customer/Account Name<br>
Transfer Funds To<br>
For Account No.<br>
Reference/Attention To<br>
Authorized Officer (Customer Representative)<br>
Date<br>
(Please Print) Signature<br>
Bank Officer Name<br>
Date<br>
(Please Print) Signature</P>

<P>(Deliver Completed Form to Credit Support Staff For Immediate Processing)</P>

<P><strong>EXHIBIT E<br>
</strong>NOTE<br>
[Date]</P>

<P>Madison Gas and Electric Company, a Wisconsin corporation (the "Borrower"), promises to pay
to the order of ____________________________________ (the "Lender") the aggregate unpaid
principal amount of all Loans made by the Lender to the Borrower pursuant to Section 2.2 of the
Agreement (as hereinafter defined), in immediately available funds at the main office of Bank
One, NA in Chicago, Illinois, as Administrative Agent, together with interest on the unpaid
principal amount hereof at the rates and on the dates set forth in the Agreement. The Borrower
shall pay the principal of and accrued and unpaid interest on the Loans in full on the Facility
Termination Date.</P>

<P>The Lender shall, and is hereby authorized to, record on the schedule attached hereto, or to
otherwise record in accordance with its usual practice, the date and amount of each Loan and the
date and amount of each principal payment hereunder.</P>

<P>This Note is one of the Notes issued pursuant to, and is entitled to the benefits of, the Credit
Agreement dated as of July 14, 2004 (which, as it may be amended or modified and in effect
from time to time, is herein called the "Agreement"), among the Borrower, the lenders party
thereto, including the Lender, and Bank One, NA, as Administrative Agent, to which Agreement
reference is hereby made for a statement of the terms and conditions governing this Note,
including the terms and conditions under which this Note may be prepaid or its maturity date
accelerated. Capitalized terms used herein and not otherwise defined herein are used with the
meanings attributed to them in the Agreement.</P>

<P>MADISON GAS AND ELECTRIC COMPANY<strong><br>
</strong>By:<br>
Print Name:<br>
Title: </P>

<P>SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF MADISON GAS AND ELECTRIC COMPANY,
DATED _____________,</P>

<TABLE BORDER CELLSPACING=2 CELLPADDING=10 WIDTH=780>
  <TR>
    <TD WIDTH="20%" VALIGN="BOTTOM"><P ALIGN="CENTER">Date</TD>
    <TD WIDTH="20%" VALIGN="BOTTOM"><P ALIGN="CENTER">Principal<BR>
        Amount of<BR>
        Loan</TD>
    <TD WIDTH="20%" VALIGN="BOTTOM"><P ALIGN="CENTER">Maturity<BR>
        of Interest<BR>
        Period</TD>
    <TD WIDTH="20%" VALIGN="BOTTOM"><P ALIGN="CENTER">Principal<BR>
        Amount<BR>
        Paid</TD>
    <TD WIDTH="20%" VALIGN="BOTTOM"><P ALIGN="CENTER">Unpaid<BR>
        Balance</TD>
  </TR>
</TABLE>
<P>&nbsp;</P>

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