Wilmington Trust Co.

INTERCREDITOR AGREEMENT

        This COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT (this "Intercreditor Agreement") dated as of December 15, 1999 among: (i) MIDWEST GENERATION EME LLC, a Delaware limited liability company (together with its successors and assigns, "MGE"); (ii) EDISON MISSION MIDWEST HOLDINGS CO., a Delaware corporation (together with its successors and assigns, "Holdings"); (iii) EDISON MISSION OVERSEAS CO., a Delaware limited liability company (together with its successors and assigns, "EMOC"); (iv) MIDWEST GENERATION, LLC, a Delaware limited liability company (together with its successors and assigns, "Midwest"); (v) COLLINS HOLDINGS EME, LLC, a Delaware limited liability company (together with its successors and assigns, "Collins Holdings"); (vi) COLLINS TRUST I, a Delaware business trust (together with its successor and assigns, "Owner Lessor I"); (vii) COLLINS TRUST II, a Delaware business trust (together with its successor and assigns, "Owner Lessor II"); (viii) COLLINS TRUST III, a Delaware business trust (together with its successor and assigns, "Owner Lessor III"); (ix) COLLINS TRUST IV, a Delaware business trust (together with its successor and assigns, "Owner Lessor IV", and, together with Owner Lessor I, Owner Lessor II and Owner Lessor III, the "Owner Lessors"); (x) MIDWEST FUNDING LLC, a Delaware limited liability company (together with its successors and assigns, "Funding LLC"); (xi) Citibank, N.A., a national banking association, as the holder representative under the Lessor Loan Agreement with Owner Lessor I referred to below (together with its successors and assigns in such capacity, the "Trust I Holder Representative"), acting in such capacity for and on behalf of Holders under the Lessor Loan Agreement with Owner Lessor I (the "Trust I Holders"); (xii) Citibank, N.A., a national banking association, as the holder representative under the Lessor Loan Agreement with Owner Lessor II referred to below (together with its successors and assigns in such capacity, the "Trust II Holder Representative"), acting in such capacity for and on behalf of Holders under the Lessor Loan Agreement with Owner Lessor II (the "Trust II Holders"); (xiii) Citibank, N.A., a national banking association, as the holder representative under the Lessor Loan Agreement with Owner Lessor III referred to below (together with its successors and assigns in such capacity, the "Trust III Holder Representative"), acting in such capacity for and on behalf of Holders under the Lessor Loan Agreement with Owner Lessor III (the "Trust III Holders"); (xiv) Citibank, N.A., a national banking association, as the holder representative under the Lessor Loan Agreement with Owner Lessor IV referred to below (together with its successors and assigns in such capacity, the "Trust IV Holder Representative", and together with the Trust I Holder Representative, the Trust II Holder Representative and the Trust III Holder Representative, the "Holder Representatives"), acting in such capacity for and on behalf of Holders under the Lessor Loan Agreement with Owner Lessor IV (the "Trust IV Holders", and together with the Trust I Holders, the Trust II Holders and the Trust III Holders, the "Holders"); (xv) The Chase Manhattan Bank, a banking institution organized under the laws of the State of New York, as the administrative agent under the Holdings Credit Agreement referred to below (together with its successors and assigns in such capacity, the "Holdings Administrative Agent"), acting in such capacity for and on behalf of the Lenders referred to in the Holdings Credit Agreement (the "Holdings Lenders"); (xvi) any trustees or agents under any Permitted Secured Indebtedness Documents, acting in such capacity for and on behalf of the holders of the indebtedness or obligations evidenced by Permitted Secured Indebtedness Documents (together with their respective successors and assigns in such capacity, the "Other Representatives"); (xvii) Bayerische Landesbank International, S.A., a banking institution organized under the laws of Luxembourg, as the Midwest LC Issuer hereunder (together with its successors and assigns in such capacity, the "Midwest LC Issuer"); (xviii) Citibank, N.A., a national banking association, as depositary agent hereunder (together with its successors and assigns in such capacity, the "Depositary Agent"); (xix) Citibank, N.A., a national banking association, as the depositary bank hereunder (together with its successors and assigns in such capacity, the "Depositary Bank"); and (xx) Citibank, N.A., a national banking association, as the collateral agent appointed hereunder for the Secured Parties (together with its successors and assigns in such capacity, the "Holdings Collateral Agent").

W I T N E S S E T H:

        WHEREAS, Midwest intends to acquire certain electric generation facilities and other related assets associated therewith and ancillary thereto located in the State of Illinois (collectively, the "ComEd Assets") pursuant to the Asset Sale Agreement dated as of March 22, 1999 (as from time to time amended, supplemented, amended and restated, or otherwise modified and in effect from time to time, the "Asset Sale Agreement") with Commonwealth Edison Company, as seller, and Edison Mission Energy, as purchaser;

        WHEREAS, Midwest intends to finance the acquisition of certain of the ComEd Assets pursuant to the Asset Sale Agreement with the proceeds of (i) equity contributions from Holdings to Midwest in the amount of $650,000,000 and (ii) intercompany loans from EMOC to Midwest in the aggregate principal amount of $3,679,000,000 funded by EMOC from equity contributions received by EMOC from Holdings in a like amount;

        WHEREAS, Holdings intends to finance its equity contributions to Midwest and EMOC from the proceeds of (i) the Tranche A Loans and the Tranche B Loans under the Holdings Credit Agreement and (ii) an equity contribution from Edison Mission Energy indirectly through MGE in the amount of $2,650,000,000;

        WHEREAS, Midwest intends to finance indirectly the acquisition of the Collins Facility under the Asset Sale Agreement through the lease financings under which each Owner Lessor shall acquire from ComEd an undivided interest in the Collins Facility and certain related assets as further described in the Facility Lease of such Owner Lessor (as to each such Facility Lease, the "Leased Assets") for the Applicable Purchase Price and lease the Leased Assets to Collins Holdings under the Facility Lease of such Owner Lessor and Collins Holdings shall sublease the Leased Assets subject to each such Facility Lease to Midwest under a Facility Sublease;

        WHEREAS, each Owner Lessor shall finance its Applicable Purchase Price through the Applicable Equity Investment provided by its respective Owner Participant and the purchase by Funding LLC of Lessor Notes issued by such Owner Lessor pursuant to the Lessor Loan Agreement of such Owner Lessor;

        WHEREAS, each Lessor Note is secured by the Lessor Collateral of such Owner Lessor including, without limitation, all right, title and interest of such Owner Lessor in, to and under, the Lease Obligations Guarantee with respect to the Facility Lease of such Owner Lessor and the related Facility Sublease;

        WHEREAS, Funding LLC shall procure funding for its purchase of the Initial Lessor Notes to be purchased by it under the Lessor Loan Agreements through administered commercial paper conduit companies supported by one or more credit facilities from banks and other financial institution;

        WHEREAS, Holdings intends to finance certain working capital requirements of the respective businesses of Holdings and its Subsidiaries (including, without limitation, Midwest) through the Tranche C Loans under the Holdings Credit Agreement;

        WHEREAS, Holdings may in the future incur Permitted Secured Indebtedness, as permitted under the Holdings Credit Agreement and the other Financing Documents;

        WHEREAS, certain of the parties hereto have entered into the Holdings Credit Agreement dated as of December 15, 1999 among Holdings, the Holdings Lenders and the Holdings Administrative Agent (as from time to time amended, supplemented, amended and restated, or otherwise modified and in effect from time to time, the "Holdings Credit Agreement");

        WHEREAS, with respect to each Facility Lease and each Facility Sublease, certain of the parties hereto have entered into a Lease Obligations Guarantee;

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        WHEREAS, Midwest and the Midwest LC Issuer have entered into the Midwest Reimbursement Agreements;

        WHEREAS, Holdings has entered into a Letter of Credit Guarantee with respect to each Midwest Reimbursement Agreement and the related Midwest Letters of Credit;

        WHEREAS, the obligations of Holdings under the Holdings Credit Agreement, the obligations of Holdings under each Lease Obligations Guarantee, the obligations of Holdings under the Letter of Credit Guarantee and the obligations of Holdings under the Permitted Secured Indebtedness Documents (in each case together with other related obligations constituting Secured Obligations) are intended to be secured by the Holdings Collateral;

        WHEREAS, the parties hereto desire to enter into this Intercreditor Agreement to set forth their mutual understanding with respect to (i) the exercise of certain rights, remedies and options by the respective parties hereto under the Financing Documents and the Security Documents, (ii) the priority of their respective Liens and Security Interests created by the Security Documents, (iii) the appointment of, and the rights and obligations of, the Holdings Collateral Agent and (iv) the appointment of the Depositary Agent and Depositary Bank to hold and administer the proceeds of certain revenues of the Obligors.

        NOW, THEREFORE, for and in consideration of the premises and mutual covenants herein contained, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto, intending to be legally bound, do hereby covenant and agree as follows:

        SECTION 1.    Definitions.    Capitalized terms not otherwise defined herein shall have the meanings set forth in, and the interpretations applicable thereto under, Annex A hereto.

        SECTION 2.    Priority of Security Interests.    Each of the Secured Parties hereby acknowledges and agrees that until the Intercreditor Agreement Termination Date:

        (a)  The Lien and Security Interest in the Holdings Collateral held by the Holdings Collateral Agent is held for the benefit of all of the Secured Parties. Pursuant to Section 4.04 of the Holdings Pledge Agreement and Section 4.04 of the EMOC Pledge Agreement, the Lien on and Security Interest in any amounts constituting Holdings Collateral or the proceeds thereof deposited into the Cashflow Recapture Fund shall, contemporaneously with such deposit, automatically terminate and be released and each Secured Party agrees that upon such deposit and at all times thereafter such amounts shall not constitute Holdings Collateral.




        (b)  The allocation of funds among the Secured Parties specified in this Intercreditor Agreement with respect to (i) the Holdings Collateral and (ii) all proceeds of the Holdings Collateral, in each case is applicable irrespective of any statement to the contrary in any Financing Document, any Security Document, or any other agreement, the time or order or method of attachment or perfection of Liens, the time or order of filing of financing statements, or the giving or failure to give notice of the acquisition or expected acquisition of purchase money or other security interests and to the extent not provided for in this Intercreditor Agreement, the rights and priorities of the Secured Parties shall be determined in accordance with Requirements of Law.




        (c)  Notwithstanding the designation of each Owner Lessor as a Secured Party in the definition thereof set out in Annex A hereto, each Owner Lessor has pledged, assigned, hypothecated and transferred to, and has granted a security interest in favor of, its respective Holder Representative for the benefit of the Holders represented by such Holder Representative in all of its rights, title and interest in the Holdings Collateral and the Cashflow Recapture Collateral as collateral security for each Lessor Note of such Owner Lessor and certain other obligations of such Owner Lessor in accordance with the Lessor Loan Agreement and the other