EXHIBIT 4(e)
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TERM LOAN AGREEMENT
Dated as of October 17, 2002
among
CONSUMERS ENERGY COMPANY,
as the Borrower,
THE FINANCIAL INSTITUTIONS NAMED HEREIN, as the Banks,
BANK ONE, NA, as Administrative Agent,
and
BARCLAYS BANK PLC, as Syndication Agent
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BANC ONE CAPITAL MARKETS, INC. and BARCLAYS CAPITAL
as Lead Arrangers and Joint Book Runners
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Table of Contents
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ARTICLE I: DEFINITIONS .............................................................. 1
1.1 Definitions .............................................................. 1
1.2 Singular and Plural ...................................................... 11
1.3 Accounting Terms ......................................................... 11
ARTICLE II: THE TERM LOANS ........................................................... 11
2.1 Initial Term Loans ....................................................... 11
2.2 Deferred Draw Term Loans ................................................. 11
2.3 Making of Term Loans ..................................................... 12
2.4 Repayment of Term Loans .................................................. 12
2.5 Commitment Fee and Reductions of Commitment. ............................. 12
2.6 Optional Principal Payments .............................................. 13
2.7 Mandatory Prepayments. ................................................... 14
2.8 Conversion and Continuation of Outstanding Term Loans .................... 14
2.9 Interest Rates, Interest Payment Dates ................................... 14
2.10 Rate after Maturity ...................................................... 15
2.11 Method of Payment ........................................................ 15
2.12 Bonds; Record-keeping; Telephonic Notices. ............................... 15
2.13 Lending Installations .................................................... 16
2.14 Non-Receipt of Funds by the Agent ........................................ 16
ARTICLE III: [RESERVED] ............................................................... 17
ARTICLE IV: CHANGE IN CIRCUMSTANCES .................................................. 17
4.1 Yield Protection ......................................................... 17
4.2 Replacement Bank ......................................................... 18
4.3 Availability of Eurodollar Rate Loans .................................... 18
4.4 Funding Indemnification .................................................. 18
4.5 Taxes. ................................................................... 18
4.6 Bank Certificates, Survival of Indemnity ................................. 20
ARTICLE V: REPRESENTATIONS AND WARRANTIES ........................................... 21
5.1 Incorporation and Good Standing .......................................... 21
5.2 Corporate Power and Authority; No Conflicts .............................. 21
5.3 Governmental Approvals ................................................... 21
5.4 Legally Enforceable Agreements ........................................... 21
5.5 Financial Statements ..................................................... 21
5.6 Litigation ............................................................... 22
5.7 Margin Stock ............................................................. 22
5.8 ERISA .................................................................... 22
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5.9 Insurance ................................................................ 22
5.10 Taxes .................................................................... 22
5.11 Investment Company Act ................................................... 22
5.12 Public Utility Holding Company Act ....................................... 22
5.13 Bonds .................................................................... 22
ARTICLE VI: AFFIRMATIVE COVENANTS .................................................... 23
6.1 Payment of Taxes, Etc .................................................... 23
6.2 Maintenance of Insurance ................................................. 23
6.3 Preservation of Corporate Existence, Etc ................................. 23
6.4 Compliance with Laws, Etc ................................................ 23
6.5 Visitation Rights ........................................................ 23
6.6 Keeping of Books ......................................................... 23
6.7 Reporting Requirements ................................................... 24
6.8 Use of Proceeds .......................................................... 25
6.9 Maintenance of Properties, Etc ........................................... 25
6.10 Bonds .................................................................... 26
ARTICLE VII: NEGATIVE COVENANTS ....................................................... 26
7.1 Liens .................................................................... 26
7.2 Sale of Assets ........................................................... 27
7.3 Mergers, Etc ............................................................. 28
7.4 Compliance with ERISA .................................................... 28
7.5 Change in Nature of Business ............................................. 28
7.6 Restricted Payments ...................................................... 28
7.7 Off-Balance Sheet Liabilities ............................................ 28
ARTICLE VIII: FINANCIAL COVENANTS ...................................................... 28
8.1 Debt to Capital Ratio .................................................... 28
8.2 Interest Coverage Ratio .................................................. 28
ARTICLE IX: EVENTS OF DEFAULT ........................................................ 29
9.1 Events of Default ........................................................ 29
9.2 Remedies ................................................................. 30
ARTICLE X: WAIVERS, AMENDMENTS AND REMEDIES ......................................... 31
10.1 Amendments ............................................................... 31
10.2 Preservation of Rights ................................................... 31
ARTICLE XI: CONDITIONS PRECEDENT ..................................................... 32
11.1 Initial Term Loan ........................................................ 32
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11.2 Incremental Deferred Draw Commitment; Deferred Draw Term Loans ............ 33
11.3 Each Term Loan ............................................................ 33
ARTICLE XII: GENERAL PROVISIONS ........................................................ 34
12.1 Successors and Assigns .................................................... 34
12.2 Survival of Representations ............................................... 36
12.3 Governmental Regulation ................................................... 36
12.4 Taxes ..................................................................... 36
12.5 Choice of Law; Waiver of Jury Trial ....................................... 36
12.6 Headings .................................................................. 36
12.7 Entire Agreement .......................................................... 36
12.8 Expenses; Indemnification ................................................. 36
12.9 [Intentionally Omitted] ................................................... 37
12.10 Severability of Provisions ................................................ 37
12.11 Setoff .................................................................... 37
12.12 Ratable Payments .......................................................... 37
12.13 Nonliability of Banks ..................................................... 37
ARTICLE XIII: THE AGENT ................................................................. 38
13.1 Appointment ............................................................... 38
13.2 Powers .................................................................... 38
13.3 General Immunity .......................................................... 38
13.4 No Responsibility for Loans, Recitals, Etc ................................ 38
13.5 Action on Instructions of Banks ........................................... 38
13.6 Employment of Agents and Counsel .......................................... 39
13.7 Reliance on Documents; Counsel ............................................ 39
13.8 Agent's Reimbursement and Indemnification ................................. 39
13.9 Rights as a Bank .......................................................... 39
13.10 Bank Credit Decision ...................................................... 39
13.11 Successor Agent ........................................................... 40
13.12 Agent and Arrangers Fees .................................................. 40
ARTICLE XIV: NOTICES ................................................................... 40
14.1 Giving Notice ............................................................. 40
14.2 Change of Address ......................................................... 40
ARTICLE XV: COUNTERPARTS ................................................................. 41
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SCHEDULES
COMMITMENT SCHEDULE
EXHIBITS
Exhibit A-1 Form of Supplemental Indenture
Exhibit A-2 Form of Incremental Supplemental Indenture
Exhibit B-1 Required Opinions from Michael D. VanHemert, Esq.
Exhibit B-2 Required Opinions from Skadden, Arps, Slate, Meagher & Flom, LLP
Exhibit B-3 Required Opinions from Miller, Canfield, Paddock and Stone, P.L.C.
Exhibit C Form of Compliance Certificate
Exhibit D Form of Assignment and Assumption Agreement
Exhibit E Terms of Subordination (Junior Subordinated Debt)
Exhibit F Terms of Subordination (Guaranty of Hybrid Preferred Securities)
Exhibit G-1 Form of Bond Delivery Agreement (Supplemental Indenture)
Exhibit G-2 Form of Bond Delivery Agreement (Incremental Supplemental Indenture)
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TERM LOAN AGREEMENT
This Term Loan Agreement, dated as of October 17, 2002, is among
Consumers Energy Company, a Michigan corporation (the "Company"), the financial
institutions listed on the signature pages hereof (together with their
respective successors and assigns, the "Banks") and Bank One, NA, a national
banking association having its principal office in Chicago, Illinois, as Agent.
WITNESSETH:
WHEREAS, the Company has requested, and the Banks have agreed to enter
into, a credit facility providing for (i) an initial Term Loan in an aggregate
amount of $70,000,000 and (ii) subsequent Term Loans up to a maximum aggregate
amount of $5,000,000, or, subject to additional terms and conditions as set
forth herein, $85,000,000;
NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I: DEFINITIONS
1.1 Definitions. As used in this Agreement:
"Accounting Changes" - see Section 1.3.
"Agent" means Bank One in its capacity as administrative agent for the
Banks pursuant to Article XIII, and not in its individual capacity as a Bank,
and any successor Agent appointed pursuant to Article XIII.
"Agreement" means this Term Loan Agreement, as amended from time to
time.
"Alternate Base Rate" means, for any day, a rate 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.
"Applicable Margin" means, (i) with respect to Eurodollar Rate Loans at
any time, 3.00% per annum, and (ii) with respect to Floating Rate Loans at any
time, 2.00% per annum; provided, however, that for any period from and after
December 1, 2002 during which the Interest Rate Reduction Conditions shall
remain unsatisfied, the Applicable Margin with respect to Eurodollar Rate Loans
during such period shall be 4.00% per annum, and the Applicable Margin with
respect to Floating Rate Loans during such period shall be 3.00% per annum.
"Arrangers" - see Section 13.12.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Assignment Agreement" - see Section 12.1(E).
"Banks" - see the preamble.
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"Bank One" means Bank One, NA (Main Office - Chicago), in its
individual capacity, and its successors and assigns.
"Base Eurodollar Rate" means, with respect to a Eurodollar Rate Loan
for the relevant Interest Period, the per annum interest rate determined by the
offered rate per annum at which deposits in U.S. dollars, for a period equal or
comparable to such Interest Period, appears on Telerate page 3750 (or any
successor page) as of 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period, or in the event such offered rate is not
available from the Telerate page, the rate offered on deposits in U.S. dollars,
for a period equal or comparable to such Interest Period, by Bank One's London
Office to prime 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,
and in an amount substantially equal to the amount of Bank One's relevant
Eurodollar Rate Loan for such Interest Period.
"Bonds" means one or more series of First Mortgage Bonds created under
the Supplemental Indenture and the Incremental Supplemental Indenture issued in
favor of, and in form and substance satisfactory to, the Agent.
"Bond Delivery Agreement" means a bond delivery agreement whereby the
Agent (x) acknowledges delivery of the applicable Bonds and (y) agrees to hold
the applicable Bonds for the benefit of the Banks and to distribute all payments
made by the Company on account thereof to the Banks, substantially in the form
of Exhibit G-1 with respect to the Bonds issued under the Supplemental Indenture
and substantially in the form of Exhibit G-2 with respect to the Bonds issued
under the Incremental Supplemental Indenture.
"Borrowing Date" means a date on which a Term Loan is made hereunder.
"Borrowing Notice" - see Section 2.1.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Rate Loans, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago, Illinois and New York, 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, Illinois and New York, New York for the conduct
of substantially all of their commercial lending activities and interbank wire
transfers can be made on the Fedwire system.
"Capital Lease" means any lease which has been or would be capitalized
on the books of the lessee in accordance with GAAP.
"CMS" means CMS Energy Corporation, a Michigan corporation.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral" means all property and interests in property now owned or
hereafter acquired by the Company or any of its Subsidiaries in or upon which a
security interest, lien or mortgage is granted to the Agent, for the benefit of
the Banks, under the Inventory Security Agreement.
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"Commitments" the Initial Term Loan Commitments, the Deferred Draw Term
Loan Commitments and the Incremental Deferred Draw Commitments.
"Commitment Fee" - see Section 2.5.
"Commitment Schedule" means the Schedule identifying each Bank's
Initial Term Loan Commitment, Deferred Draw Term Loan Commitment and Incremental
Deferred Draw Commitment as of the date hereof attached hereto and identified as
such.
"Company" - see the preamble.
"Consolidated EBIT" means Consolidated Net Income plus, (i) to the
extent deducted from revenues in determining Consolidated Net Income (without
duplication), (a) Consolidated Interest Expense, (b) expense for taxes paid or
accrued, (c) any non-cash write-offs and write-downs contained in the Company's
Consolidated Net Income, including, without limitation, write-offs or
write-downs related to the sale of assets, impairment of assets and loss on
contracts, and (d) the pre-tax write-off for the fiscal period ending December
31, 2001 in an amount not to exceed $126,000,000 arising from the loss on Power
Purchase Agreement - MCV Partnership, minus, (ii) to the extent included in
Consolidated Net Income, extraordinary gains realized other than in the ordinary
course of business, all calculated for the Company and its Subsidiaries on a
consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means with respect to any period for
which the amount thereof is to be determined, an amount equal to interest
expense on Debt, including payments in the nature of interest under Capital
Leases, all calculated for the Company and its Subsidiaries on a consolidated
basis in accordance with GAAP.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Company and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Subsidiary" means any Subsidiary whose accounts are or
are required to be consolidated with the accounts of the Company in accordance
with GAAP.
"Conversion/Continuation Notice - see Section 2.8.
"Credit Documents" means this Agreement, the Inventory Security
Agreement, the Supplemental Indenture, the Incremental Supplemental Indenture
and the Bonds.
"Debt" means, with respect to any Person, and without duplication, (a)
all indebtedness of such Person for borrowed money, (b) all indebtedness of such
Person for the deferred purchase price of property or services (other than trade
accounts payable arising in the ordinary course of business which are not
overdue), (c) all Unfunded Vested Liabilities of such Person (if such Person is
not the Company, determined in a manner analogous to that of determining
Unfunded Vested Liabilities of the Company), (d) all obligations of such Person
arising under acceptance facilities, (e) all obligations of such Person as
lessee under Capital Leases, (f) all obligations of such Person arising under
any interest rate swap, "cap", "collar" or other hedging agreement; provided
that for purposes of the calculation of Debt for this clause (f) only, the
actual amount of Debt of such Person shall be determined on a net basis to the
extent such
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agreements permit such amounts to be calculated on a net basis, and (g) all
guaranties, endorsements (other than for collection in the ordinary course of
business) and other contingent obligations of such Person to assure a creditor
against loss (whether by the purchase of goods or services, the provision of
funds for payment, the supply of funds to invest in any Person or otherwise) in
respect of indebtedness or obligations of any other Person of the kinds referred
to in clauses (a) through (f) above.
"Default" means an event which but for the giving of notice or lapse of
time, or both, would constitute an Event of Default.
"Deferred Draw Date" means any Business Day on or prior to November 25,
2002, which date shall be the date the Company shall pay the initial installment
of the "Term Loan" under (and as defined in) the Inventory Term Loan Agreement.
"Deferred Draw Term Loan" - see Section 2.2.
"Deferred Draw Term Loan Commitment" means, for each Bank, the
obligation of such Bank to make a term loan to the Company on the Deferred Draw
Date in an amount not exceeding the amount set forth on the Commitment Schedule
as its Deferred Draw Term Loan Commitment or as set forth in any Assignment
Agreement that has become effective pursuant to Section 12.1, as such amount may
be modified from time to time.
"Designated Officer" means the Chief Financial Officer, the Treasurer,
an Assistant Treasurer, any Vice President in charge of financial or accounting
matters or the principal accounting officer of the Company.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means any corporation or trade or business which is a
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as the Company or is under common control (within
the meaning of Section 414(c) of the Code) with the Company.
"Eurodollar Rate" means, with respect to any Interest Period applicable
to a Eurodollar Rate Loan, an interest rate per annum equal to the sum of (i)
the quotient obtained by dividing (a) the Base Eurodollar Rate applicable to
such Interest Period by (b) one minus the Reserve Requirement (expressed as a
decimal) applicable to such Interest Period, plus (ii) the Applicable Margin.
"Eurodollar Rate Loan" means a Term Loan which bears interest by
reference to the Eurodollar Rate.
"Event of Default" means an event described in Article IX.
"Excluded Taxes" means, in the case of each Bank or applicable Lending
Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Bank or the Agent is incorporated or organized or (ii)
4
the jurisdiction in which the Agent's or such Bank's principal executive office
or such Bank's applicable Lending Installation is located.
"Face Amount" means, with respect to any Bond, the face amount of such
Bond.
"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 Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"First Mortgage Bonds" means bonds issued by the Company pursuant to
the Indenture.
"Fitch" means Fitch, Inc. or any successor thereto.
"Floating Rate" means a rate per annum equal to (i) the Alternate Base
Rate plus (ii) the Applicable Margin, changing when and as the Alternate Base
Rate or the Applicable Margin changes.
"Floating Rate Loan" means a Term Loan which bears interest at the
Floating Rate.
"FRB" means the Board of Governors of the Federal Reserve System or any
successor thereto.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the date hereof, applied on a basis consistent
with those used in the preparation of the financial statements referred to in
Section 5.5 (except, for purposes of the financial statements required to be
delivered pursuant to Sections 6.7(B) and (C), for changes concurred in by the
Company's independent public accountants).
"Hybrid Preferred Securities" means any preferred securities issued by
a Hybrid Preferred Securities Subsidiary, where such preferred securities have
the following characteristics:
(i) such Hybrid Preferred Securities Subsidiary lends
substantially all of the proceeds from the issuance of such preferred
securities to the Company or a wholly-owned direct or indirect
Subsidiary of the Company in exchange for Junior Subordinated Debt
issued by the Company or such wholly-owned direct or indirect
Subsidiary, respectively;
(ii) such preferred securities contain terms providing for the
deferral of interest payments corresponding to provisions providing for
the deferral of interest payments on the Junior Subordinated Debt; and
5
(iii) the Company or a wholly-owned direct or indirect
Subsidiary of the Company (as the case may be) makes periodic interest
payments on the Junior Subordinated Debt, which interest payments are
in turn used by the Hybrid Preferred Securities Subsidiary to make
corresponding payments to the holders of the preferred securities.
"Hybrid Preferred Securities Subsidiary" means any Delaware business
trust (or similar entity) (i) all of the common equity interest of which is
owned (either directly or indirectly through one or more wholly-owned
Subsidiaries of the Company) at all times by the Company or a wholly-owned
direct or indirect Subsidiary of the Company, (ii) that has been formed for the
purpose of issuing Hybrid Preferred Securities and (iii) substantially all of
the assets of which consist at all times solely of Junior Subordinated Debt
issued by the Company or a wholly-owned direct or indirect Subsidiary of the
Company (as the case may be) and payments made from time to time on such Junior
Subordinated Debt.
"Incremental Deferred Draw Commitment" means, for each Bank, the
obligation of such Bank to make a term loan to the Company on the Deferred Draw
Date, which commitment shall not be effective until, and shall be subject to,
the full satisfaction of the conditions set forth in Section 11.2, in an amount
not exceeding the amount set forth on the Commitment Schedule as its Incremental
Deferred Draw Commitment or as set forth in any Assignment Agreement that has
become effective pursuant to Section 12.1, as such amount may be modified from
time to time.
"Incremental Supplemental Indenture" means a supplemental indenture
substantially in the form of Exhibit A-2.
"Indenture" means the Indenture, dated as of September 1, 1945, as
supplemented and amended from time to time, from the Company to JPMorgan Chase
Bank (formerly known as The Chase Manhattan Bank), as successor Trustee.
"Initial Borrowing Date" means October 17, 2002.
"Initial Term Loan Commitment" means, for each Bank, the obligation of
such Bank to make a term loan to the Company on the Initial Borrowing Date in an
amount not exceeding the amount set forth on the Commitment Schedule as its
Initial Term Loan Commitment.
"Interest Period" means, with respect to a Eurodollar Rate Loan, a
period of one, two, three or six months, or such shorter period agreed to by the
Company and the Banks, commencing on a Business Day selected by the Company
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
(or such shorter period agreed to by the Company and the Banks; provided such
shorter period shall not exceed ten periods at any time), provided, however,
that if there is no such numerically corresponding day in such next, second,
third or sixth succeeding month (or such shorter period, as applicable), such
Interest Period shall end on the last Business Day of such next, second, third
or sixth succeeding month (or such shorter period, as applicable). If an
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
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succeeding Business Day falls in a new calendar month, such Interest Period
shall end on the immediately preceding Business Day. The Company may not select
any Interest Period that ends after the Maturity Date.
"Interest Rate Reduction Conditions" means the delivery by the Company
to the Agent and the Banks of (i) restated audited financial statements for CMS
Energy Corporation for the 2000 and 2001 fiscal years, certified by independent
certified public accountants acceptable to the Banks, together with copies of
the certifications thereof executed by the chief executive officer and chief
financial officer of CMS Energy Corporation and delivered to the SEC, and (ii) a
certificate from the chief financial officer of the Company stating that upon
the Agent's request the Company shall promptly deliver a bring-down letter from
independent certified public accountants acceptable to the Agent with respect to
the Company's financial statements for the period since the date of the most
recently delivered and reviewed financial statements of the Company as set forth
in the Company's most recent quarterly report on Form 10-Q filed with the SEC.
"Inventory Security Agreement" means that certain Security Agreement,
dated as of October 17, 2002, by and between the Company and the Agent, as the
same may be amended, restated, supplemented or otherwise modified from time to
time.
"Inventory Term Loan Agreement" means the Inventory Term Loan
Agreement, dated as of October 17, 2002, by and among the Company, the various
financial institutions from time to time parties thereto, and Bank One, NA, as
Administrative Agent, as the same may be amended, restated, supplemented or
otherwise modified from time to time.
"Junior Subordinated Debt" means any unsecured Debt of the Company or a
Subsidiary of the Company (i) issued in exchange for the proceeds of Hybrid
Preferred Securities and (ii) subordinated to the rights of the Banks hereunder
and under the other Credit Documents pursuant to terms of subordination
substantially similar to those set forth in Exhibit E, or pursuant to other
terms and conditions satisfactory to the Majority Banks.
"Lending Installation" means any office, branch, subsidiary or
affiliate of a Bank.
"Lien" means any lien (statutory or otherwise), security interest,
mortgage, deed of trust, priority, pledge, charge, conditional sale, title
retention agreement, financing lease or other encumbrance or similar right of
others, or any agreement to give any of the foregoing.
"Loan" means a Floating Rate Loan or a Eurodollar Rate Loan, as
applicable.
"Majority Banks" means, as of any date of determination, Banks whose
Pro Rata Shares, in the aggregate, are 66 2/3% or more of the sum of the
aggregate amount of all of the Deferred Draw Term Loan Commitments and
Incremental Deferred Draw Commitments, if any, plus the outstanding principal
balance of all Term Loans as of such date.
"Material Adverse Change" means any event, development or circumstance
that has had or could reasonably be expected to have a material adverse effect
on (a) the business, assets, property, financial condition, results of
operations or prospects of the Company and its Subsidiaries, considered as a
whole, (b) the Company's ability to perform its obligations under
7
this Agreement and the other Credit Documents, (c) the validity or
enforceability of any Credit Document or the rights or remedies of the Agent or
the Banks thereunder, or (d) the perfection or priority of the Agent's Liens
with respect to the Collateral.
"Maturity Date" means April 15, 2003.
"Moody's" means Moody's Investors Service, Inc. or any successor
thereto.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA.
"Net Proceeds" means, with respect to any sale or issuance of
securities or incurrence of Debt by any Person, the excess of (i) the gross cash
proceeds received by or on behalf of such Person in respect of such sale,
issuance or incurrence (as the case may be) over (ii) customary underwriting
commissions, auditing and legal fees, printing costs, rating agency fees and
other customary and reasonable fees and expenses incurred by such Person in
connection therewith.
"Net Worth" means, with respect to any Person, the excess of such
Person's total assets over its total liabilities, total assets and total
liabilities each to be determined in accordance with GAAP consistently applied,
excluding, however, from the determination of total assets (i) goodwill,
organizational expenses, research and development expenses, trademarks, trade
names, copyrights, patents, patent applications, licenses and rights in any
thereof, and other similar intangibles, (ii) cash held in a sinking or other
analogous fund established for the purpose of redemption, retirement or
prepayment of capital stock or Debt, and (iii) any items not included in clauses
(i) or (ii) above, that are treated as intangibles in conformity with GAAP.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Term Loans, all accrued and unpaid Commitment Fees and all other
obligations of the Company to the Banks or to any Bank, any Arranger or the
Agent arising under the Credit Documents.
"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 Capital 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.
"Operating Lease" of a Person means any lease of Property (other than a
Capital Lease) by such Person as lessee.
"Other Taxes" - see Section 4.5(B).
"Payment Date" means the second Business Day of each calendar quarter
occurring after the Initial Borrowing Date.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
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"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, governmental authority or other entity of whatever
nature.
"Plan" means any employee benefit plan (other than a Multiemployer
Plan) maintained for employees of the Company or any ERISA Affiliate and covered
by Title IV of ERISA.
"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.
"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.
"Pro Rata Share" means, with respect to any Bank, at any time, the
percentage obtained by dividing (i) the sum of such Bank's Deferred Draw Term
Loan Commitment and Incremental Deferred Draw Commitment, if any, at such time
plus the outstanding principal balance of such Bank's Term Loans at such time by
(ii) the sum of the aggregate amount of all of the Deferred Draw Term Loan
Commitments and Incremental Deferred Draw Commitments, if any, plus the
outstanding principal balance of all Term Loans.
"Regulation D" means Regulation D of the FRB from time to time in
effect and shall include any successor or other regulation or official
interpretation of said FRB relating to reserve requirements applicable to member
banks of the Federal Reserve System.
"Regulation U" means Regulation U of the FRB from time to time in
effect and shall include any successor or other regulation or official
interpretation of said FRB relating to the extension of credit by banks,
non-banks and non-broker-dealers for the purpose of purchasing or carrying
margin stocks.
"Reportable Event" has the meaning assigned to that term in Title IV of
ERISA.
"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.
"S&P" means Standard and Poor's Rating Services, a division of The
McGraw Hill Companies, Inc. or any successor thereto.
"SEC" means the Securities and Exchange Commission or any governmental
authority which may be substituted therefor.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Securitized Bonds" shall mean any nonrecourse bonds or similar
asset-backed securities issued by a special-purpose Subsidiary of the Company
which are payable solely from
9
specialized charges authorized by the utility commission of the relevant state
in connection with the recovery of regulatory assets or other stranded costs.
"Senior Debt" means the First Mortgage Bonds.
"Single Employer Plan" means a Plan maintained by the Company or any
ERISA Affiliate for employees of the Company or any ERISA Affiliate.
"Subsidiary" means, as to any Person, any corporation or other entity
of which at least a majority of the securities or other ownership interests
having ordinary voting power (absolutely or contingently) for the election of
directors or other Persons performing similar functions are at the time owned
directly or indirectly by such Person.
"Supplemental Indenture" means a supplemental indenture substantially
in the form of Exhibit A-1.
"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.
"Term Loans" means the Initial Term Loans and the Deferred Draw Term
Loans.
"Termination Event" means (a) a Reportable Event described in Section
4043 of ERISA and the regulations issued thereunder (other than a Reportable
Event not subject to the provision for 30-day notice to the PBGC under such
regulations), or (b) the withdrawal of the Company or any of its ERISA
Affiliates from a Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001 (a) (2) of ERISA, or (c) the filing of a
notice of intent to terminate a Plan or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA, or (d) the institution of proceedings
to terminate a Plan by the PBGC or to appoint a trustee to administer any Plan.
"Total Consolidated Capitalization" means, at any date of
determination, the sum of (a) Total Consolidated Debt, (b) equity of the common
stockholders of the Company, (c) equity of the preference stockholders of the
Company and (d) equity of the preferred stockholders of the Company, in each
case determined at such date.
"Total Consolidated Debt" means, at any date of determination, the
aggregate Debt of the Company and its Consolidated Subsidiaries; provided, that
Total Consolidated Debt shall exclude (i) the principal amount of any
Securitized Bonds, (ii) any Junior Subordinated Debt owned by any Hybrid
Preferred Securities Subsidiary, (iii) any guaranty by the Company of payments
with respect to any Hybrid Preferred Securities, provided that such guaranty is
subordinated to the rights of the Banks hereunder and under the other Credit
Documents pursuant to terms of subordination substantially similar to those set
forth in Exhibit F, or pursuant to other terms and conditions satisfactory to
the Majority Banks, (iv) such percentage of the Net Proceeds from any issuance
of hybrid debt/equity securities (other than Junior Subordinated Debt and Hybrid
Preferred Securities) by the Company or any Consolidated Subsidiary as shall be
agreed to be deemed equity by the Agent and the Company prior to the issuance
thereof (which
10
determination shall be based on, among other things, the treatment (if any)
given to such securities by the applicable rating agencies).
"Type" means, with respect to any Loan, the character of such Loan as a
Eurodollar Rate Loan or a Floating Rate Loan.
"Unfunded Vested Liabilities" means, (i) in the case of Single Employer
Plans, the amount (if any) by which the present value of all vested
nonforfeitable benefits under such Plan exceeds the fair market value of all
Plan assets allocable to such benefits, all determined as of the then most
recent valuation date for such Plan, and (ii) in the case of Multiemployer
Plans, the withdrawal liability of the Company and its ERISA Affiliates.
1.2 Singular and Plural. The foregoing definitions shall be
equally applicable to both the singular and plural forms of the defined terms.
1.3 Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP. If any changes in
generally accepted accounting principles are hereafter required or permitted and
are adopted by the Company or any of its Subsidiaries, or the Company or any of
its Subsidiaries shall change its application of generally accepted accounting
principles with respect to any Off-Balance Sheet Liabilities, in each case with
the agreement of its independent certified public accountants, and such changes
result in a change in the method of calculation of any of the financial
covenants, tests, restrictions or standards herein or in the related definitions
or terms used therein ("Accounting Changes"), the parties hereto agree, at the
Company's request, to enter into negotiations, in good faith, in order to amend
such provisions in a credit neutral manner so as to reflect equitably such
changes with the desired result that the criteria for evaluating the Company's
and its Subsidiaries' financial condition shall be the same after such changes
as if such changes had not been made; provided, however, until such provisions
are amended in a manner reasonably satisfactory to the Agent, the Arrangers and
the Majority Banks, no Accounting Change shall be given effect in such
calculations. In the event such amendment is entered into, all references in
this Agreement to GAAP shall mean generally accepted accounting principles as of
the date of such amendment.
ARTICLE II: THE TERM LOANS
2.1 Initial Term Loans. Each Bank severally agrees, on the
terms and conditions set forth in this Agreement, to make a term loan to the
Company on the Initial Borrowing Date in an amount equal to such Bank's Initial
Term Loan Commitment (each individually, an "Initial Term Loan" and,
collectively, the "Initial Term Loans"). The Company shall give the Agent
irrevocable notice (a "Borrowing Notice") not later than 10:00 a.m.
(Chicago time) on the Initial Borrowing Date, specifying (i) the Borrowing Date,
which shall be the Initial Borrowing Date, and (ii) the aggregate amount of the
Initial Term Loans. The Initial Term Loans shall initially be Floating Rate
Loans and thereafter may be continued as Floating Rate Loans or converted into
Eurodollar Rate Loans in the manner provided in Section 2.8.
2.2 Deferred Draw Term Loans. Each Bank severally agrees, on
the terms and conditions set forth in this Agreement, to make a term loan to the
Company on the Deferred Draw Date in an amount equal to such Bank's Deferred
Draw Term Loan Commitment plus its
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then effective Incremental Deferred Draw Commitment, if any (each individually,
a "Deferred Draw Term Loan" and, collectively, the "Deferred Draw Term Loans").
The Company shall give the Agent an irrevocable Borrowing Notice not later than
10:00 a.m. (Chicago time) on the third Business Day prior to the proposed
Borrowing Date, specifying (i) the Borrowing Date, which shall be a Business
Day, (ii) the aggregate amount of the Deferred Draw Term Loans, (iii) whether
the Deferred Draw Term Loans initially will be Floating Rate Loans or Eurodollar
Rate Loans and (iv) in the case of Eurodollar Rate Loans, the initial Interest
Period applicable thereto. If the Deferred Draw Term Loans are not borrowed by
the Company on the Deferred Draw Date, the Deferred Draw Term Loan Commitments
and the Incremental Deferred Draw Commitments, if any, shall terminate on
November 25, 2002 unless earlier terminated by the Company pursuant to Section
2.5(B). The Deferred Draw Term Loans, if requested, shall be drawn in a single
borrowing, and the excess, if any, of the aggregate Deferred Draw Term Loan
Commitments and the Incremental Deferred Draw Commitments on the Borrowing Date
over the aggregate amount of the Deferred Draw Term Loans requested by the
Company on such Borrowing Date shall terminate on such Borrowing Date.
2.3 Making of Term Loans. Promptly after receipt thereof, the
Agent will notify each Bank of the contents of each Borrowing Notice. Not later
than 12:00 noon (Chicago time) on each Borrowing Date, each Bank shall make
available its applicable Term Loan in funds immediately available in Chicago to
the Agent at its address specified pursuant to Article XIV. To the extent funds
are received from the Banks, the Agent will make such funds available to the
Company at the Agent's aforesaid address. No Bank's obligation to make any Term
Loan shall be affected by any other Bank's failure to make any Term Loan.
2.4 Repayment of Term Loans. The Term Loans shall be repaid in
four (4) installments, payable on the dates set forth below, commencing on
January 31, 2003 and continuing thereafter until the Maturity Date, and the Term
Loans shall be permanently reduced by the amount of each installment on the date
payment thereof is made hereunder. The installments shall be in the aggregate
amounts set forth below:
<Table>
<Caption>
Installment Date Term Loan Installment Amount
- ---------------- ----------------------------
January 31, 2003 $ 29,000,000
February 28, 2003 $ 45,000,000
March 31, 2003 $ 36,000,000
April 15, 2003 $ 45,000,000 (or, if less, the then
outstanding principal balance of the Term Loans)
</Table>
Notwithstanding the foregoing, the final installment shall be in the amount of
the then outstanding principal balance of the Term Loans. No installment of any
Term Loan may be reborrowed once repaid.
2.5 Commitment Fee and Reductions of Commitment.
(A) The Company agrees to pay to the Agent for the account of
each Bank according to its Pro Rata Share a commitment fee (the
"Commitment Fee") at the rate of 0.50% per annum on the aggregate
Deferred Draw Term Loan Commitments from the
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Initial Borrowing Date to but not including the earlier of (i) the
Borrowing Date of the Deferred Draw Term Loans and (ii) the date on
which the Deferred Draw Term Loan Commitments are terminated in full
(the earlier of such dates being the "Termination Date"). The
Commitment Fee shall be payable quarterly in arrears on each Payment
Date (for the quarter then most recently ended) and on the Termination
Date (for the period then ended for which such fee has not previously
been paid). The Commitment Fee shall be calculated for actual days
elapsed on the basis of a 360 day year.
(B) The Company may permanently reduce the aggregate Deferred
Draw Term Loan Commitments and the Incremental Deferred Draw
Commitments in whole, or in part ratably among the Banks in the minimum
amount of $5,000,000 (and in multiples of $1,000,000 if in excess
thereof), upon at least five Business Days' written notice to the
Agent, which shall specify the amount of any such reduction. All
accrued Commitment Fees shall be payable on the effective date of any
termination of the obligation of the Banks to make Deferred Draw Term
Loans hereunder. Upon any permanent reduction in the aggregate Deferred
Draw Term Loan Commitments pursuant to the terms of this Section
2.5(B), the Agent shall, upon request of the Company, promptly
surrender to or upon the order of the Company one or more Bonds
specified by the Company; provided that the Company remains in
compliance with Section 6.10.
2.6 Optional Principal Payments. From and after the date that
all of the obligations under the Inventory Term Loan Agreement shall have been
paid in full and the Inventory Term Loan Agreement shall have been terminated,
the Company may, upon at least one (1) Business Days' prior written notice to
the Agent (which the Agent shall promptly transmit to each Bank), without
penalty or premium, prepay the Term Loans which are Floating Rate Loans, in
whole or in part. Term Loans which are Eurodollar Rate Loans may be prepaid in
whole or in part upon at least three (3) Business Days' prior written notice to
the Agent (which the Agent shall promptly transmit to each Bank), (A) on the
expiration date of the then applicable Interest Period therefor, and (B) subject
to the payment of the amounts required by Section 4.4, but otherwise without
penalty or premium, on any other date. Any notice of prepayment given to the
Agent under this Section 2.6 shall specify the date (which shall be a Business
Day) of prepayment, the aggregate principal amount of the prepayment and any
allocation of such amount among the then remaining installments of the Term
Loans and among the Floating Rate Loans and Eurodollar Rate Loans. When notice
of prepayment is delivered as provided herein, the principal amount of the Term
Loans specified in the notice shall become due and payable on the prepayment
date specified in such notice. Unless the aggregate outstanding principal
balance of the Term Loans is to be prepaid in full, voluntary prepayments of the
Term Loans shall be in an aggregate minimum amount of $10,000,000 and integral
multiples of $1,000,000 in excess of that amount. Each voluntary prepayment of
the Term Loans shall be allocated first to Term Loans which are Floating Rate
Loans until paid in full and then to Term Loans which are Eurodollar Rate Loans.
Amounts prepaid hereunder may not be reborrowed. Upon any prepayment of the Term
Loans pursuant to the terms of this Section 2.6, the Agent shall, upon request
of the Company, promptly surrender to or upon the order of the Company one or
more Bonds specified by the Company; provided that the Company remains in
compliance with Section 6.10.
13
2.7 Mandatory Prepayments. Within three Business Days after
the Company's or any of its Subsidiaries' receipt of any Net Proceeds with
respect to any sale or issuance of debt securities by the Company or any of its
Subsidiaries in the capital markets (other than Net Proceeds up to $100,000,000
in the aggregate in respect of debt securities with a maturity date one year or
more from the date of issuance thereof provided that such securities shall not
contain representations, warranties, covenants, events of default and remedies
more restrictive than the terms and conditions set forth in this Agreement), the
Company shall make a mandatory prepayment of the Term Loans and the "Term Loans"
under (and as defined in) the Inventory Term Loan Agreement, ratably, in an
amount equal to 100% of such Net Proceeds. Amounts prepaid hereunder shall be
applied to outstanding accrued interest and then ratably to each of the then
remaining installments payable under the Term Loans and may not be reborrowed.
Upon any prepayment of the Term Loans pursuant to the terms of this Section 2.7,
the Agent shall, upon request of the Company, promptly surrender to or upon the
order of the Company one or more Bonds specified by the Company; provided that
the Company remains in compliance with Section 6.10.
2.8 Conversion and Continuation of Outstanding Term Loans.
Floating Rate Loans shall continue as Floating Rate Loans unless and until such
Floating Rate Loans are converted into Eurodollar Rate Loans pursuant to this
Section 2.8 or are repaid in accordance with Sections 2.4 or 2.6. Each
Eurodollar Rate Loan shall continue as a Eurodollar Rate Loan until the end of
the then applicable Interest Period therefor, at which time such Eurodollar Rate
Loan shall be automatically converted into a Floating Rate Loan unless (x) such
Eurodollar Rate Loan is or was repaid in accordance with Sections 2.4 or 2.6 or
(y) the Company shall have given the Agent a Conversion/Continuation Notice (as
defined below) requesting that, at the end of such Interest Period, such
Eurodollar Rate Loan continue as a Eurodollar Rate Loan for the same or another
Interest Period. The Company may elect from time to time to convert all or any
part (in the minimum amount of $10,000,000 and in integral multiples of
$1,000,000 in excess thereof) of a Floating Rate Loan into a Eurodollar Rate
Loan. There shall be no more than ten (10) Interest Periods in effect at any
time. The Company shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of a Floating Rate Loan
into a Eurodollar Rate Loan or continuation of a Eurodollar Rate Loan not later
than 11:00 a.m. (Chicago time) at least three Business Days prior to the date of
the requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount and Type of the Loan which is to be
converted or continued; and
(iii) the amount of the Loan which is to be converted into or
continued as a Eurodollar Rate Loan and the duration of the
Interest Period applicable thereto.
2.9 Interest Rates, Interest Payment Dates. (A) Subject to
Section 2.10, each Loan shall bear interest as follows:
14
(i) at any time such Loan is a Floating Rate Loan, at a rate
per annum equal to the Floating Rate from time to time in effect; and
(ii) at any time such Loan is a Eurodollar Rate Loan, at a
rate per annum equal to the Eurodollar Rate for each applicable
Interest Period therein.
Changes in the rate of interest on that portion of any Term Loan maintained as a
Floating Rate Loan will take effect simultaneously with each change in the
Floating Rate.
(B) Interest accrued on each Floating Rate Loan shall be
payable on each Payment Date and at maturity. Interest accrued on each
Eurodollar Rate Loan shall be payable on the last day of its applicable
Interest Period, on any date on which such Eurodollar Rate Loan is
prepaid and at maturity. Interest accrued on each Eurodollar Rate Loan
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. All fees hereunder and all interest on all Term Loans
shall be calculated for actual days elapsed on the basis of a 360-day
year. Interest on each Term Loan shall accrue from and including the
date such Term Loan is made to but excluding the date payment thereof
is received in accordance with Section 2.11. If any payment of
principal of or interest on an Term Loan 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.
2.10 Rate after Maturity. Any Term Loan not paid by the
Company at maturity, whether by acceleration or otherwise, shall bear interest
until paid in full at a rate per annum equal to the higher of the rate otherwise
applicable thereto plus 1% or the Floating Rate plus 1%.
2.11 Method of Payment. All payments of principal, interest
and fees hereunder shall be made in immediately available funds to the Agent at
its address specified on its signature page to this Agreement (or at any other
Lending Installation of the Agent specified in writing by the Agent to the
Company) not later than noon (Chicago time) on the date when due and shall be
applied ratably by the Agent among the Banks. Funds received after such time
shall be deemed received on the following Business Day unless the Agent shall
have received from, or on behalf of, the Company a Federal Reserve reference
number with respect to such payment before 3:00 p.m. (Chicago time) on the date
of such payment. Each payment delivered to the Agent for the account of any Bank
shall be delivered promptly by the Agent in the same type of funds received by
the Agent to such Bank at the address specified for such Bank on its signature
page to this Agreement or at any Lending Installation specified in a notice
received by the Agent from such Bank. The Agent is hereby authorized to charge
the account of the Company maintained with Bank One, if any, for each payment of
principal, interest, and fees as such payment becomes due hereunder.
2.12 Bonds; Record-keeping; Telephonic Notices.
(A) The obligation of the Company to repay the Obligations
shall be evidenced by one or more Bonds.
15
(B) Each Bank shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the
Company to such Bank resulting from each Term Loan made by such Bank
from time to time, including the amounts of principal and interest
payable and paid to such Bank from time to time hereunder.
(C) The Agent shall also maintain accounts in which it will
record (i) the amount of each Term Loan made hereunder, the Type
thereof and the Interest Period with respect thereto, (ii) the amount
of any principal or interest due and payable or to become due and
payable from the Company to each Bank hereunder, and (iii) the amount
of any sum received by the Agent hereunder from the Company and each
Bank's share thereof.
(D) The entries maintained in the accounts maintained pursuant
to paragraphs (B) and (C) above shall be prima facie evidence of the
existence and amounts of the Obligations therein recorded; provided,
however, that the failure of the Agent or any Bank to maintain such
accounts or any error therein shall not in any manner affect the
obligation of the Company to repay the Obligations in accordance with
their terms.
(E) The Company hereby authorizes the Banks and the Agent to
make, convert or continue Term Loans based on telephonic notices made
by any person or persons the Agent or any Bank in good faith believes
to be acting on behalf of the Company. The Company agrees to deliver
promptly to the Agent a written confirmation of each telephonic notice
signed by a Designated Officer. If the written confirmation differs in
any material respect from the action taken by the Agent and the Banks,
the records of the Agent and the Banks shall govern absent manifest
error.
2.13 Lending Installations. Subject to the provisions of
Section 4.6, each Bank may book its Term Loans at any Lending Installation
selected by such Bank, and may change its Lending Installation from time to
time. All terms of this Agreement shall apply to any such Lending Installation
and the Term Loans shall be deemed held by the applicable Bank for the benefit
of such Lending Installation. Each Bank may, by written or facsimile notice to
the Company, designate a Lending Installation through which Term Loans will be
made by it and for whose account payments on the Term Loans are to be made.
2.14 Non-Receipt of Funds by the Agent. Unless a Bank or the
Company, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Bank, the
proceeds of a Term Loan or (ii) in the case of the Company, a payment of
principal, interest or fees to the Agent for the account of the Banks, that it
does not intend to make such payment, the Agent may assume that such payment has
been made. The 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 Bank or the Company, as the case may be, has not in fact made such payment
to the Agent, the recipient of such payment shall, on demand by the Agent, repay
to the 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 Agent until the date the Agent recovers such amount at a
rate per annum equal to (i) in the case of payment by a Bank, the Federal Funds
Rate for such day or (ii) in the case of payment by the Company, the interest
rate applicable to the relevant Term Loan.
16
ARTICLE III: [RESERVED]
ARTICLE IV: CHANGE IN CIRCUMSTANCES
4.1 Yield Protection. (A) If any change in law or any
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law), or any interpretation thereof by any agency or
authority having jurisdiction over any Bank,
(i) subjects any Bank or any applicable Lending Installation
to any increased tax, duty, charge or withholding on or from payments
due from the Company (excluding taxation measured by or attributable to
the overall net income of such Bank or applicable Lending Installation,
whether overall or in any geographic area), or changes the rate of
taxation of payments to any Bank in respect of its Term Loans or other
amounts due it hereunder, or
(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 Bank or any applicable Lending Installation (including,
without limitation, any reserve costs under Regulation D with respect
to Eurocurrency liabilities (as defined in Regulation D)), or
(iii) imposes any other condition the result of which is to
increase the cost to any Bank or any applicable Lending Installation of
making, funding or maintaining Term Loans, or reduces any amount
receivable by any Bank or any applicable Lending Installation in
connection with Term Loans or requires any Bank or any applicable
Lending Installation to make any payment calculated by reference to its
outstanding Term Loans or interest received by it, by an amount deemed
material by such Bank, or
(iv) affects the amount of capital required or expected to be
maintained by any Bank or Lending Installation or any corporation
controlling any Bank and such Bank determines the amount of capital
required is increased by or based upon the existence of this Agreement
or its obligation to make Term Loans hereunder or of commitments of
this type,
then, upon presentation by such Bank to the Company of a certificate (as
referred to in the immediately succeeding sentence of this Section 4.1) setting
forth the basis for such determination and the additional amounts reasonably
determined by such Bank for the period of up to 90 days prior to the date on
which such certificate is delivered to the Company and the Agent, to be
sufficient to compensate such Bank in light of such circumstances, the Company
shall within 30 days of such delivery of such certificate pay to the Agent for
the account of such Bank the specified amounts set forth on such certificate.
The affected Bank shall deliver to the Company and the Agent a certificate
setting forth the basis of the claim and specifying in reasonable detail the
calculation of such increased expense, which certificate shall be prima facie
evidence as to such increase and such amounts. An affected Bank may deliver more
than one certificate to the Company during the term of this Agreement. In making
the determinations contemplated by the above-referenced certificate, any Bank
may make such reasonable estimates, assumptions, allocations and the like that
such Bank in good faith determines to be
17
appropriate, and such Bank's selection thereof in accordance with this Section
4.1 shall be conclusive and binding on the Company, absent manifest error.
(B) No Bank shall be entitled to demand compensation or be
compensated hereunder to the extent that such compensation relates to
any period of time more than 90 days prior to the date upon which such
Bank first notified the Company of the occurrence of the event
entitling such Bank to such compensation (unless, and to the extent,
that any such compensation so demanded shall relate to the retroactive
application of any event so notified to the Company).
4.2 Replacement Bank. If any Bank shall make a demand for
payment under Section 4.1, then within 30 days after such demand, the Company
may, with the approval of the Agent (which approval shall not be unreasonably
withheld) and provided that no Default or Event of Default shall then have
occurred and be continuing, demand that such Bank assign to one or more
financial institutions designated by the Company and approved by the Agent all
(but not less than all) of such Bank's Deferred Draw Term Loan Commitment and
Incremental Deferred Draw Commitment, if any, and outstanding Term Loans within
the period ending on the later of such 30th day and the last day of the longest
of the then current Interest Periods or maturity dates for such outstanding Term
Loans. It is understood that such assignment shall be consummated on terms
satisfactory to the Company, the Agent and the assigning Bank, provided that
such assigning Bank's consent to such an assignment shall not be unreasonably
withheld.
4.3 Availability of Eurodollar Rate Loans. If
(A) any Bank determines that maintenance of a Eurodollar Rate
Loan at a suitable Lending Installation would violate any applicable
law, rule, regulation or directive, whether or not having the force of
law, or
(B) the Majority Banks determine that (i) deposits of a type
and maturity appropriate to match fund Eurodollar Rate Loans are not
available or (ii) the Base Eurodollar Rate does not accurately reflect
the cost of making or maintaining a Eurodollar Rate Loan,
then the Agent shall suspend the availability of Eurodollar Rate Loans and, in
the case of clause (A), require any Eurodollar Rate Loans to be converted to
Floating Rate Loans on such date as is required by the applicable law, rule,
regulation or directive.
4.4 Funding Indemnification. If any payment of a Eurodollar
Rate Loan occurs on a date which is not the last day of an applicable Interest
Period, whether because of prepayment or otherwise, or a Eurodollar Rate Loan is
not made on the date specified by the Company for any reason other than default
by the Banks, the Company will indemnify each Bank for any loss or cost (but not
lost profits) incurred by it resulting therefrom, including, without limitation,
any loss or cost in liquidating or employing deposits acquired to fund or
maintain such Eurodollar Rate Loan; provided that the Company shall not be
liable for any of the foregoing to the extent they arise because of acceleration
by any Bank.
4.5 Taxes.
18
(A) All payments by the Company to or for the account of any
Bank or the Agent hereunder or under any Bond shall be made free and
clear of and without deduction for any and all Taxes. If the Company
shall be required by law to deduct any Taxes from or in respect of any
sum payable hereunder to any Bank or the Agent, (i) 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 4.5) such Bank or the Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Company shall make such deductions,
(iii) the Company shall pay the full amount deducted to the relevant
authority in accordance with applicable law and (iv) the Company shall
furnish to the Agent the original copy of a receipt evidencing payment
thereof within 30 days after such payment is made.
(B) In addition, the Company 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 Bond or from the execution or delivery of, or
otherwise with respect to, this Agreement or any Bond ("Other Taxes").
(C) The Company hereby agrees to indemnify the Agent and each
Bank 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 Agent or such Bank 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 Agent or such Bank makes demand therefor
pursuant to Section 4.6.
(D) Each Bank that is not incorporated under the laws of the
United States of America or a state thereof (each a "Non-U.S. Bank ")
agrees that it will, not more than ten Business Days after the date
hereof, or, if later, not more than ten Business Days after becoming a
Bank hereunder, (i) deliver to each of the Company and the Agent two
(2) duly completed copies of United States Internal Revenue Service
Form W8BEN or W8ECI, certifying in either case that such Bank 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 Company and the 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.
Bank further undertakes to deliver to each of the Company and the 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 Company or the Agent. All
forms or amendments described in the preceding sentence shall certify
that such Bank 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 Bank from duly completing and
delivering any such form or amendment with respect to it and such Bank
19
advises the Company and the Agent that it is not capable of receiving
payments without any deduction or withholding of United States federal
income tax.
(E) For any period during which a Non-U.S. Bank has failed to
provide the Company with an appropriate form pursuant to clause (D),
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.
Bank shall not be entitled to indemnification under this Section 4.5
with respect to Taxes imposed by the United States; provided that,
should a Non-U.S. Bank 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 (D) above, the Company
shall take such steps as such Non-U.S. Bank shall reasonably request to
assist such Non-U.S. Bank to recover such Taxes.
(F) Any Bank that is entitled to an exemption from or
reduction of withholding tax with respect to payments under this
Agreement or any Bond pursuant to the law of any relevant jurisdiction
or any treaty shall deliver to the Company (with a copy to the 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.
(G) 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 Agent did not
properly withhold tax from amounts paid to or for the account of any
Bank (because the appropriate form was not delivered or properly
completed, because such Bank failed to notify the Agent of a change in
circumstances which rendered its exemption from withholding
ineffective, or for any other reason), such Bank shall indemnify the
Agent fully for all amounts paid, directly or indirectly, by the Agent
as tax, withholding therefor, or otherwise, including penalties and
interest, and including taxes imposed by any jurisdiction on amounts
payable to the Agent under this subsection, together with all costs and
expenses related thereto (including attorneys fees and time charges of
attorneys for the Agent, which attorneys may be employees of the
Agent). The obligations of the Banks under this Section 4.5(G) shall
survive the payment of the Obligations and termination of this
Agreement.
4.6 Bank Certificates, Survival of Indemnity. To the extent
reasonably possible, each Bank shall designate an alternate Lending Installation
with respect to Eurodollar Rate Loans to reduce any liability of the Company to
such Bank under Section 4.1 or to avoid the unavailability of Eurodollar Rate
Loan under Section 4.3, so long as such designation is not disadvantageous to
such Bank. A certificate of such Bank as to the amount due under Section 4.1,
4.4 or 4.5 shall be final, conclusive and binding on the Company in the absence
of manifest error. Determination of amounts payable under such Sections in
connection with a Eurodollar Rate Loan shall be calculated as though each Bank
funded each Eurodollar Rate Loan through the purchase of a deposit of the type
and maturity corresponding to the deposit used as a reference in determining the
Base Eurodollar Rate applicable to such Eurodollar Rate Loan whether in fact
that is the case or not. Unless otherwise provided herein, the amount specified
in
20
any certificate shall be payable on demand after receipt by the Company of such
certificate. The obligations of the Company under Sections 4.1, 4.4 and 4.5
shall survive payment of the Obligations and termination of this Agreement,
provided, that no Bank shall be entitled to compensation to the extent that such
compensation relates to any period of time more than 90 days after the
termination of this Agreement.
ARTICLE V: REPRESENTATIONS AND WARRANTIES
The Company hereby represents and warrants that:
5.1 Incorporation and Good Standing. The Company is duly
incorporated, validly existing and in good standing under the laws of the State
of Michigan.
5.2 Corporate Power and Authority; No Conflicts. The
execution, delivery and performance by the Company of the Credit Documents are
within the Company's corporate powers, have been duly authorized by all
necessary corporate action and do not (i) violate the Company's charter, bylaws
or any applicable law, or (ii) breach or result in an event of default under any
indenture or material agreement, and do not result in or require the creation of
any Lien upon or with respect to any of its properties (except the lien in favor
of the Agent pursuant to the Inventory Security Agreement and the lien of the
Indenture securing the Bonds).
5.3 Governmental Approvals. No authorization or approval or
other action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution, delivery and performance by
the Company of any Credit Document, except for the authorization to issue, sell
or guarantee secured and/or unsecured short-term debt granted by the Federal
Energy Regulatory Commission, which authorization has been obtained and is in
full force and effect.
5.4 Legally Enforceable Agreements. Each Credit Document
constitutes a legal, valid and binding obligation of the Company, enforceable in
accordance with its terms, subject to (a) the effect of applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and (b) the application of general
principles of equity (regardless of whether considered in a proceeding in equity
or at law).
5.5 Financial Statements. The audited balance sheet of the
Company and its Consolidated Subsidiaries as at December 31, 2001, and the
related statements of income and cash flows of the Company and its Consolidated
Subsidiaries for the fiscal year then ended, as set forth in the Company's
Annual Report on Form 10-K (copies of which have been furnished to each Bank),
and the unaudited balance sheet of the Company and its Consolidated Subsidiaries
as at June 30, 2002 (copies of which have been furnished to each Bank), fairly
present the financial condition of the Company and its Consolidated Subsidiaries
as at such dates and the results of operations of the Company and its
Consolidated Subsidiaries for the periods ended on such dates, all in accordance
with GAAP (except to the extent that the Company may restate its financial
statements for the years ended December 30, 2000 and December 31, 2001, in
connection with its new auditor's review of such statements in support of the
re-audit of CMS Energy Corporation's financial statements), and since December
31, 2001, there has been
21
no Material Adverse Change (except to the extent described in the Company's
Quarterly Report on Form 10-Q for the quarter ended June 30, 2002 as filed with
the SEC, copies of which have been furnished to each Bank).
5.6 Litigation. Except (i) to the extent described in the
Company's Annual Report on Form 10-K for the year ended December 31, 2001,
Quarterly Report on Form 10-Q for the quarter ended June 30, 2002, and Current
Reports on Form 8-K filed by the Company on July 30, 2002 and September 8, 2002,
in each case as filed with the SEC, copies of which have been furnished to each
Bank, and (ii) such other similar actions, suits and proceedings predicated on
the occurrence of the same events giving rise to any actions, suits and
proceedings described in the Reports filed with the SEC set forth in clause (i)
hereof, there is no pending or threatened action or proceeding against the
Company or any of its Consolidated Subsidiaries before any court, governmental
agency or arbitrator, which, if adversely determined, might reasonably be
expected to materially adversely affect the financial condition, results of
operations, business, Property or prospects of the Company and its Consolidated
Subsidiaries, taken as a whole, or that would materially adversely affect the
Company's ability to perform its obligations under any Credit Document. As of
the Initial Borrowing Date, there is no litigation challenging the validity or
the enforceability of any of the Credit Documents.
5.7 Margin Stock. The Company is not engaged in the business
of extending credit for the purpose of buying or carrying margin stock (within
the meaning of Regulation U), and no proceeds of any Term Loan will be used to
buy or carry any margin stock or to extend credit to others for the purpose of
buying or carrying any margin stock.
5.8 ERISA. No Termination Event has occurred or is reasonably
expected to occur with respect to any Plan. Neither the Company nor any of its
ERISA Affiliates is an employer under a Multiemployer Plan.
5.9 Insurance. All insurance required by Section 6.2 is in
full force and effect.
5.10 Taxes. The Company and its Subsidiaries have filed all
tax returns (Federal, state and local) required to be filed and paid all taxes
shown thereon to be due, including interest and penalties, or, to the extent the
Company or any of its Subsidiaries is contesting in good faith an assertion of
liability based on such returns, has provided adequate reserves for payment
thereof in accordance with GAAP.
5.11 Investment Company Act. The Company is not an investment
company (within the meaning of the Investment Company Act of 1940, as amended).
5.12 Public Utility Holding Company Act. The Company is exempt
from the registration requirements of the Public Utility Holding Company Act of
1935, as amended, 15 USC 79, et seq.
5.13 Bonds. The issuance to the Agent of Bonds as evidence of
the Obligations (i) will not violate any provision of the Indenture or any
other agreement or instrument, or any law or regulation, or judicial or
regulatory order, judgment or decree, to which the Company or any of its
Subsidiaries is a party or by which any of the foregoing is bound and (ii) will
provide
22
the Banks, as beneficial holders of the Bonds through the Agent, the benefit of
the Lien of the Indenture equally and ratably with the holders of other First
Mortgage Bonds.
ARTICLE VI: AFFIRMATIVE COVENANTS
So long as any Obligations shall remain unpaid or any Bank shall have
any Commitment under this Agreement, the Company shall:
6.1 Payment of Taxes, Etc. Pay and discharge before the same
shall become delinquent, (a) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property, and (b) all lawful claims which, if
unpaid, might by law become a Lien upon its property, provided that the Company
shall not be required to pay or discharge any such tax, assessment, charge or
claim (i) which is being contested by it in good faith and by proper procedures
or (ii) the non-payment of which will not materially adversely affect the
financial condition or results of operations of the Company and its Consolidated
Subsidiaries, taken as a whole.
6.2 Maintenance of Insurance. Maintain insurance in such
amounts and covering such risks with respect to its business and properties as
is usually carried by companies engaged in similar businesses and owning similar
properties, either with reputable insurance companies or, in whole or in part,
by establishing reserves or one or more insurance funds, either alone or with
other corporations or associations.
6.3 Preservation of Corporate Existence, Etc. Preserve and
maintain its corporate existence, rights and franchises, and qualify and remain
qualified as a foreign corporation in each jurisdiction in which such
qualification is necessary in view of its business and operations or the
ownership of its properties, provided that the Company shall not be required to
preserve any such right or franchise or to remain so qualified unless the
failure to do so would have a material adverse effect on the financial condition
or results of operations of the Company and its Consolidated Subsidiaries, taken
as a whole, or the ability of the Company to enter into, or to perform its
obligations under, any Credit Document.
6.4 Compliance with Laws, Etc. Comply with the requirements of
all applicable laws, rules, regulations and orders of any governmental
authority, the non-compliance with which would materially adversely affect the
financial condition or results of operations of the Company and its Consolidated
Subsidiaries, taken as a whole, or the ability of the Company to perform its
obligations under any Credit Document.
6.5 Visitation Rights. Subject to any necessary approval from
the Nuclear Regulatory Commission, at any reasonable time and from time to time,
permit the Agent, any of the Banks or any agents or representatives thereof to
examine and make copies of and abstracts from its records and books of account,
visit its properties and discuss its affairs, finances and accounts with any of
its officers.
6.6 Keeping of Books. Keep, and cause each Consolidated
Subsidiary to keep, adequate records and books of account, in which full and
correct entries shall be made of all of its financial transactions and its
assets and business so as to permit the Company and its Consolidated
Subsidiaries to present financial statements in accordance with GAAP.
23
6.7 Reporting Requirements. Furnish to the Agent, with
sufficient copies for each of the Banks:
(A) as soon as practicable and in any event within five
Business Days after becoming aware of the occurrence of any Default or
Event of Default, a statement of a Designated Officer as to the nature
thereof, and as soon as practicable and in any event within five
Business Days thereafter, a statement of a Designated Officer as to the
action which the Company has taken, is taking or proposes to take with
respect thereto;
(B) as soon as available and in any event within 60 days after
the end of each of the first three quarters of each fiscal year of the
Company, a consolidated balance sheet of the Company and its
Consolidated Subsidiaries as at the end of such quarter, and the
related consolidated statements of income, cash flows and common
stockholder's equity of the Company and its Consolidated Subsidiaries
as at the end of and for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter, setting
forth in each case in comparative form the corresponding figures for
the corresponding date or period of the preceding fiscal year, or
statements providing substantially similar information (which
requirement shall be deemed satisfied by the delivery of the Company's
quarterly report on Form 10-Q for such quarter), all in reasonable
detail and duly certified (subject to the absence of footnotes and to
year-end audit adjustments) by a Designated Officer as having been
prepared in accordance with GAAP, together with (i) a certificate of a
Designated Officer (which certificate shall also accompany the
financial statements delivered pursuant to clause (C) below) stating
that such officer has no knowledge (having made due inquiry with
respect thereto) that a Default or Event of Default has occurred and is
continuing, or, if a Default or Event of Default has occurred and is
continuing, a statement as to the nature thereof and the actions which
the Company has taken, is taking or proposes to take with respect
thereto, and (ii) a certificate of a Designated Officer, in
substantially the form of Exhibit C hereto, setting forth the Company's
computation of the financial ratios specified in Sections 8.1 and 8.2
as of the end of the immediately preceding fiscal quarter or year, as
the case may be, of the Company;
(C) as soon as available and in any event within 120 days
after the end of each fiscal year of the Company, a copy of the Annual
Report on Form 10-K (or any successor form) for the Company for such
year, including therein the consolidated balance sheet of the Company
and its Consolidated Subsidiaries as at the end of such year and the
consolidated statements of income, cash flows and common stockholder's
equity of the Company and its Consolidated Subsidiaries as at the end
of and for such year, or statements providing substantially similar
information, in each case certified by independent public accountants
of recognized national standing selected by the Company (and not
objected to by the Majority Banks), together with a certificate of such
accounting firm addressed to the Banks stating that, in the course of
its examination of the consolidated financial statements of the Company
and its Consolidated Subsidiaries, which examination was conducted by
such accounting firm in accordance with GAAP, (1) such accounting firm
has obtained no knowledge that an Event of Default, insofar as such
Event of Default related to accounting or financial matters, has
occurred and is continuing, or if, in the opinion of such accounting
firm, such an Event of Default has
24
occurred and is continuing, a statement as to the nature thereof, and
(2) such accounting firm has examined a certificate prepared by the
Company setting forth the computations made by the Company in
determining, as of the end of such fiscal year, the ratios specified in
Sections 8.1 and 8.2, which certificate shall be attached to the
certificate of such accounting firm, and such accounting firm confirms
that such computations accurately reflect such ratios;
(D) promptly after the sending or filing thereof, copies of
all proxy statements which the Company sends to its stockholders,
copies of all regular, periodic and special reports (other than those
which relate solely to employee benefit plans) which the Company files
with the SEC and notice of the sending or filing of (and, upon the
request of the Agent or any Bank, a copy of) any final prospectus filed
with the SEC;
(E) as soon as possible and in any event (i) within 30 days
after the Company or any of its ERISA Affiliates knows or has reason to
know that any Termination Event described in clause (a) of the
definition of Termination Event with respect to any Plan has occurred
and (ii) within ten days after the Company or any of its ERISA
Affiliates knows or has reason to know that any other Termination Event
with respect to any Plan has occurred, a statement of the Chief
Financial Officer of the Company describing such Termination Event and
the action, if any, which the Company or such ERISA Affiliate, as the
case may be, proposes to take with respect thereto;
(F) promptly upon becoming aware thereof, notice of any
upgrading or downgrading of the rating of the Senior Debt by Fitch,
Moody's or S&P;
(G) as soon as possible and in any event within five (5) days
after the occurrence of any material default under any material
agreement to which the Company or any of its Subsidiaries is a party,
which default would materially adversely affect the financial
condition, business, results of operations, Property or prospects of
the Company and its Subsidiaries, considered as a whole, any of which
is continuing on the date of such certificate, a certificate of the
president or chief financial officer of the Company setting forth the
details of such material default and the action which the Company or
any such Subsidiary proposes to take with respect thereto; and
(H) such other information respecting the Collateral or the
business, properties or financial condition of the Company as the Agent
or any Bank through the Agent may from time to time reasonably request.
6.8 Use of Proceeds. The Company will use the proceeds of the
Term Loans for general corporate purposes and working capital. The Company will
not, nor will it permit any Subsidiary to, use any of the proceeds of the Term
Loans to purchase or carry any "margin stock" (as defined in Regulation U).
6.9 Maintenance of Properties, Etc. The Company shall, and
shall cause each of its Subsidiaries to, maintain in all material respects all
of its respective owned and leased Property in good and safe condition and
repair to the same degree as other companies engaged in similar businesses and
owning similar properties, and not permit, commit or suffer any waste or
25
abandonment of any such Property, and from time to time make or cause to be made
all material repairs, renewals and replacements thereof, including, without
limitation, any capital improvements which may be required; provided, however,
that such Property may be altered or renovated in the ordinary course of the
Company's or its Subsidiaries' business; and provided, further, that the
foregoing shall not restrict the sale of any asset of the Company or any
Subsidiary to the extent not prohibited by Section 7.2.
6.10 Bonds. Beginning on the Initial Borrowing Date and
continuing until the Commitments have terminated and all Obligations have been
paid in full, cause the aggregate amount of all Bonds outstanding to at all
times be equal to or greater than the aggregate outstanding Term Loans and
interest hereunder.
6.11 First Mortgage Bonds. The Company shall not issue, or
cause to be issued, any First Mortgage Bonds on or before the Deferred Draw Date
other than to provide the Banks, as beneficial holders of the Bonds through the
Agent, the benefit of the Lien of the Indenture equally and ratably with the
holders of other First Mortgage Bonds to secure the Term Loans made pursuant to
the Deferred Draw Term Loan Commitments and the then effective Incremental Term
Loan Commitments.
ARTICLE VII: NEGATIVE COVENANTS
So long as any Obligations shall remain unpaid or any Bank shall have
any Commitment under this Agreement, the Company shall not:
7.1 Liens. Create, incur, assume or suffer to exist any Lien
upon or with respect to any of its properties, now owned or hereafter acquired,
except:
(A) Liens created pursuant to the Indenture securing the First
Mortgage Bonds;
(B) Liens securing pollution control bonds, or bonds issued to
refund or refinance pollution control bonds (including Liens securing
obligations (contingent or otherwise) of the Company under letter of
credit agreements or other reimbursement or similar credit enhancement
agreements with respect to pollution control bonds), provided that the
aggregate face amount of any such bonds so issued shall not exceed the
aggregate face amount of such pollution control bonds, as the case may
be, so refunded or refinanced;
(C) Liens in (and only in) assets acquired to secure Debt
incurred to finance the acquisition of such assets;
(D) Statutory and common law banker's Liens on bank deposits;
(E) Liens in respect of accounts receivable sold, transferred
or assigned by the Company;
(F) Liens for taxes, assessments or other governmental charges
or levies not at the time delinquent or thereafter payable without
penalty or being contested in good faith
26
by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books;
(G) Liens of carriers, warehousemen, mechanics, materialmen
and landlords incurred in the ordinary course of business for sums not
overdue or being contested in good faith by appropriate proceedings and
for which adequate reserves shall have been set aside on its books;
(H) Liens incurred in the ordinary course of business in
connection with workers' compensation, unemployment insurance or other
forms of governmental insurance or benefits, or to secure performance
of tenders, statutory obligations, leases and contracts (other than for
borrowed money) entered into in the ordinary course of business or to
secure obligations on surety or appeal bonds;
(I) Judgment Liens in existence less than 30 days after the
entry thereof or with respect to which execution has been stayed or the
payment of which is covered (subject to a customary deductible) by
insurance;
(J) Zoning restrictions, easements, licenses, covenants,
reservations, utility company rights, restrictions on the use of real
property or minor irregularities of title incident thereto which do not
in the aggregate materially detract from the value of the property or
assets of the Company or materially impair the operation of its
business;
(K) Liens arising in connection with the financing of the
Company's fuel resources, including, but not limited to, nuclear fuel;
(L) Liens arising pursuant to MCL 324.20138; provided that the
aggregate amount of all obligations secured by such Liens (excluding
any such Liens of which the Company has no knowledge or which are
permitted by subsection (F) above) shall not exceed $20,000,000;
(M) Liens arising in connection with Securitized Bonds;
(N) Liens on the "Facility LC Collateral Account" under (and
as defined in) that certain 364-Day Credit Agreement, dated as of July
12, 2002, by and among the Company, the banks from time to time parties
thereto, and Bank One, NA, as agent thereunder, as amended, restated,
supplemented or otherwise modified from time to time;
(O) Liens on the Collateral in favor of the Agent under the
Inventory Term Loan Agreement pursuant to the Inventory Security
Agreement; and
(P) Other Liens securing obligations in an aggregate amount
not in excess of $150,000,000.
7.2 Sale of Assets. Sell, lease, assign, transfer or otherwise
dispose of 15% or more of its assets.
27
7.3 Mergers, Etc. Merge with or into or consolidate with or
into any other Person, except that the Company may merge with any other Person,
provided that, in each case, immediately after giving effect thereto, (a) no
event shall occur and be continuing which constitutes a Default or Event of
Default, (b) the Company is the surviving corporation, (c) the Company shall not
be liable with respect to any Debt or allow its property to be subject to any
Lien which it could not become liable with respect to or allow its property to
become subject to under this Agreement on the date of such transaction and (d)
the Company's Net Worth shall be equal to or greater than its Net Worth
immediately prior to such merger.
7.4 Compliance with ERISA. Permit to exist any occurrence of
any Reportable Event, or any other event or condition which presents a material
(in the reasonable opinion of the Majority Banks) risk of a termination by the
PBGC of any Plan of the Company or any ERISA Affiliate, which termination will
result in any material (in the reasonable opinion of the Majority Banks)
liability of the Company or such ERISA Affiliate to the PBGC.
7.5 Change in Nature of Business. Make any material change in
the nature of its business as carried on as of the date hereof.
7.6 Restricted Payments. The Company: (a) will not declare or
pay any dividends or make any other distributions on its capital stock (other
than dividends payable solely in such capital stock) or redeem any such capital
stock; and (b) will not, and will not permit any Subsidiary to, purchase or
otherwise acquire or retire any of the Company's capital stock or make any loans
or advances to CMS or any Subsidiary thereof (other than the Company or any
Subsidiary thereof); provided that, so long as no Default or Event of Default
exists, the Company may pay dividends in an aggregate amount not to exceed
$300,000,000 during any calendar year.
7.7 Off-Balance Sheet Liabilities. Create, incur, assume or
suffer to exist, or permit any Subsidiary to create, incur, assume or suffer to
exist, Off-Balance Sheet Liabilities (exclusive of obligations arising in
connection with (a) the Amended and Restated Receivables Sale Agreement among
the Company, Asset Securitization Cooperative Corporation and Canadian Imperial
Bank of Commerce dated as of April 1, 2002 and (b) the Master Lease and Lease
Supplement, each dated as of April 23, 2001, between Consumers Campus Holding,
LLC (a wholly-owned Subsidiary of the Company), as lessee, and Wilmington Trust
Company, not in its individual capacity but solely as Owner Trustee of CEC Trust
2001-A, as lessor, along with various other related agreements) in the aggregate
in excess of $150,000,000 at any time.
ARTICLE VIII: FINANCIAL COVENANTS
So long as any of the Obligations shall remain unpaid or any Bank shall
have any Commitment under this Agreement, the Company shall:
8.1 Debt to Capital Ratio. At all times, maintain a ratio of
Total Consolidated Debt to Total Consolidated Capitalization of not greater than
0.65 to 1.0.
8.2 Interest Coverage Ratio. Not permit the ratio, determined
as of the end of each of its fiscal quarters for the then most-recently ended
four fiscal quarters, of (i) Consolidated EBIT to (ii) Consolidated Interest
Expense to be less than 2.0 to 1.0.
28
ARTICLE IX: EVENTS OF DEFAULT
9.1 Events of Default. The occurrence of any of the following
events shall constitute an "Event of Default":
(A) The Company shall fail to pay (i) any principal of any
Term Loan when due and payable, or (ii) any interest on any Term Loan
or any fee or other Obligation payable hereunder within five (5) days
after such interest or fee or other Obligation becomes due and payable;
(B) Any representation or warranty made by the Company (or any
of its officers) in this Agreement or any other Credit Document or in
any certificate, document, report, financial or other written statement
furnished at any time pursuant to any Credit Document shall prove to
have been incorrect in any material respect on or as of the date made;
(C) The Company shall fail to perform or observe any term,
covenant or agreement contained in Section 6.10, Section 6.11, Article
VII or Article VIII; or the Company shall fail to perform or observe
any other term, covenant or agreement on its part to be performed or
observed in this Agreement or in any other Credit Document and such
failure shall continue for 30 consecutive days after notice thereof by
means of facsimile, regular mail or written notice delivered in person
(or telephonic notice thereof confirmed in writing) shall have been
given to the Company by the Agent or the Majority Banks;
(D) The Company shall: (i) fail to pay any Debt (other than
the payment obligations described in subsection (A) above) in excess of
$25,000,000, or any interest or premium thereon, when due (whether by
scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace
period, if any, specified in the instrument or agreement relating to
such Debt; or (ii) fail to perform or observe any term, covenant or
condition on its part to be performed or observed under any agreement
or instrument relating to any such Debt, when required to be performed
or observed, if the effect of such failure to perform or observe is to
accelerate, or to permit the acceleration of, the maturity of such
Debt, unless the obligee under or holder of such Debt shall have waived
in writing such circumstance, or such circumstance has been cured, so
that such circumstance is no longer continuing; or (iii) any such Debt
shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment), in each case
in accordance with the terms of such agreement or instrument, prior to
the stated maturity thereof; or (iv) generally not, or shall admit in
writing its inability to, pay its debts as such debts become due;
(E) The Company: (i) shall make an assignment for the benefit
of creditors, or petition or apply to any tribunal for the appointment
of a custodian, receiver or trustee for it or a substantial part of its
assets; or (ii) shall commence any proceeding under any bankruptcy,
reorganization, arrangement, readjustment of debt, dissolution or
liquidation law or statute of any jurisdiction, whether now or
hereafter in effect; or (iii) shall have
29
had any such petition or application filed or any such proceeding shall
have been commenced, against it, in which an adjudication or
appointment is made or order for relief is entered, or which petition,
application or proceeding remains undismissed for a period of 30
consecutive days or more; or (iv) by any act or omission shall indicate
its consent to, approval of or acquiescence in any such petition,
application or proceeding or order for relief or the appointment of a
custodian, receiver or trustee for all or any substantial part of its
property; or (v) shall suffer any such custodianship, receivership or
trusteeship to continue undischarged for a period of 30 days or more;
or (vi) shall take any corporate action to authorize any of the actions
set forth above in this subsection (E);
(F) One or more judgments, decrees or orders for the payment
of money in excess of $25,000,000 in the aggregate shall be rendered
against the Company and either (i) enforcement proceedings shall have
been commenced by any creditor upon any such judgment or order or (ii)
there shall be any period of more than 30 consecutive days during which
a stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect;
(G) Any Termination Event with respect to a Plan shall have
occurred, and 30 days after notice thereof shall have been given to the
Company by the Agent, (i) such Termination Event (if correctable) shall
not have been corrected and (ii) the then present value of such Plan's
vested benefits exceeds the then current value of the assets
accumulated in such Plan by more than the amount of $25,000,000 (or in
the case of a Termination Event involving the withdrawal of a
"substantial employer" (as defined in Section 4001(A)(2) of ERISA), the
withdrawing employer's proportionate share of such excess shall exceed
such amount).
(H) Any Bond shall cease to be in full force and effect
(except for Bonds surrendered by the Agent pursuant to Section 2.5(B),
2.6 or 2.7); or the Company shall deny that it has any liability or
obligation under any Bond or purport to revoke, terminate, rescind or
redeem any Bond (other than in accordance with the terms of the Bonds
and the Indenture).
(I) Any of the following shall occur and shall continue for
ten (10) consecutive days after the Company has knowledge thereof: (i)
on any date after the attachment of the Lien thereunder, the Inventory
Security Agreement shall for any reason fail to create a valid and
perfected first priority security interest in the Collateral purported
to be covered thereby, (ii) the Inventory Security Agreement shall fail
to remain in full force or effect, except with respect to any
Collateral released pursuant to the express terms of thereof, or (iii)
any action shall be taken to discontinue or to assert the invalidity or
unenforceability of the Inventory Security Agreement.
9.2 Remedies. If any Event of Default shall occur and be
continuing, the Agent shall upon the request, or may with the consent, of the
Majority Banks, by notice to the Company, (i) declare the Commitments to be
terminated or suspended, whereupon the same shall forthwith terminate, and/or
(ii) declare the Obligations to be forthwith due and payable, whereupon the
aggregate outstanding Term Loans and all other Obligations shall become and be
forthwith due and payable, in each case without presentment, demand, protest or
further notice of
30
any kind, all of which are hereby expressly waived by the Company, provided that
in the case of an Event of Default referred to in subsection 9.1(E) above, the
Commitments shall automatically terminate and the Obligations shall
automatically become due and payable without notice, presentment, demand,
protest or other formalities of any kind, all of which are hereby expressly
waived by the Company.
ARTICLE X: WAIVERS, AMENDMENTS AND REMEDIES
10.1 Amendments. Subject to the provisions of this Article X,
the Majority Banks (or the Agent with the consent in writing of the Majority
Banks) and the Company may enter into written agreements supplemental hereto for
the purpose of adding or modifying any provisions to the Credit Documents or
changing in any manner the rights of the Banks or the Company hereunder or
waiving any Event of Default hereunder, provided that no such supplemental
agreement shall, without the consent of all of the Banks:
(a) Extend the maturity of any Term Loan or reduce the
principal amount thereof to a date after the Maturity Date, or reduce
the rate or extend the time of payment of interest thereon or fees
thereon.
(b) Modify the percentage specified in the definition of
Majority Banks.
(c) Extend the Deferred Draw Date or increase the amount of
the Commitments of any Bank hereunder, or permit the Company to assign
its rights under this Agreement.
(d) Amend Section 6.10 or this Section 10.1.
(e) Make any change in an express right in this Agreement of a
single Bank to give its consent, make a request or give a notice.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent.
10.2 Preservation of Rights. No delay or omission of the Banks
or the Agent to exercise any right under the Credit Documents shall impair such
right or be construed to be a waiver of any Default or Event of Default or an
acquiescence therein, and the making of a Term Loan notwithstanding the
existence of a Default or Event of Default or the inability of the Company to
satisfy the conditions precedent to such Term 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 Credit Documents whatsoever shall be valid unless in writing
signed by the Banks required pursuant to Section 10.1, and then only to the
extent in such writing specifically set forth. All remedies contained in the
Credit Documents or by law afforded shall be cumulative and all shall be
available to the Agent and the Banks until the Obligations have been paid in
full.
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ARTICLE XI: CONDITIONS PRECEDENT
11.1 Initial Term Loan. The Banks shall not be required to
make the Initial Term Loan hereunder unless the Company has furnished to the
Agent with sufficient copies for the Banks:
(A) Copies of the Restated Articles of Incorporation of the
Company, together with all amendments, certified by the Secretary or an
Assistant Secretary of the Company, and a certificate of good standing,
certified by the appropriate governmental officer in its jurisdiction
of incorporation.
(B) Copies, certified by the Secretary or an Assistant
Secretary of the Company, of its bylaws and of its Board of Directors'
resolutions (and resolutions of other bodies, if any are deemed
necessary by counsel for any Bank) authorizing the execution of the
Credit Documents.
(C) An incumbency certificate, executed by the Secretary or an
Assistant Secretary of the Company, which shall identify by name and
title and bear the original or facsimile signature of the officers of
the Company authorized to sign the Credit Documents and the officers or
other employees authorized to make borrowings hereunder, upon which
certificate the Banks shall be entitled to rely until informed of any
change in writing by the Company.
(D) A certificate, signed by a Designated Officer of the
Company, stating that on the date hereof no Default or Event of Default
has occurred and is continuing.
(E) Evidence satisfactory to the Agent of the issuance of
Bonds in the form set forth in the Supplemental Indenture and in an
aggregate principal amount of $70,000,000 pursuant to the applicable
Bond Delivery Agreement.
(F) Favorable opinions of: (i) Michael D. VanHemert, Esq.,
Deputy General Counsel of the Company, as to the matters set forth in
Exhibit B-1 and as to such other matters as the Agent may reasonably
request; and (ii) Skadden, Arps, Slate, Meagher & Flom LLP, special
counsel to the Company, as to the matters set forth in Exhibit B-2 and
as to such other matters as the Agent may reasonably request; and (iii)
Miller, Canfield, Paddock and Stone, P.L.C., special counsel to the
Company, as to the matters set forth in Exhibit B-3 and as to such
other matters as the Agent may reasonably request. Such opinions shall
be addressed to the Agent and the Banks and shall be satisfactory in
form and substance to the Agent.
(G) Evidence satisfactory to the Agent that the initial "Term
Loan" under and as defined in the Inventory Term Loan Agreement shall
have been made or shall be made simultaneously with the Initial Term
Loan hereunder.
(H) Evidence, in form and substance satisfactory to the Agent,
that the Company has obtained all governmental approvals, if any,
necessary for it to enter into the Credit Documents.
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(I) Such other documents as any Bank or its counsel may have
reasonably requested.
It shall be a further condition precedent to the making of the Initial Term Loan
hereunder that the Company shall have paid (i) to the Agent for the account of
the Banks the fees required to be paid on the Initial Borrowing Date and (ii) to
the Agent and the Arrangers the fees required to be paid to them pursuant to the
fee letter described in Section 13.12.
11.2 Incremental Deferred Draw Commitment; Deferred Draw Term
Loans. No Bank's Incremental Deferred Draw Commitment shall be effective and
binding on such Bank, and no Bank shall be required to make any Deferred Draw
Term Loan hereunder, unless and until the Company has furnished to the Agent
with sufficient copies for the Banks:
(A) Evidence satisfactory to the Agent of the issuance of
Bonds in the form set forth in the Incremental Supplemental Indenture
and in an aggregate principal amount equal to the aggregate principal
amount of the Term Loans requested pursuant to Section 2.2 with respect
to the Deferred Draw Term Loan Commitment plus the aggregate principal
amount of the Term Loans requested pursuant to Section 2.2 with respect
to the then effective aggregate Incremental Deferred Draw Commitment
pursuant to the applicable Bond Delivery Agreement.
(B) Favorable opinions of: (i) Michael D. VanHemert, Esq.,
Deputy General Counsel of the Company, as to the matters set forth in
Exhibit B-1 and as to such other matters as the Agent may reasonably
request; and (ii) Miller, Canfield, Paddock and Stone, P.L.C., special
counsel to the Company, as to the matters set forth in Exhibit B-3 and
as to such other matters as the Agent may reasonably request. Such
opinions shall be addressed to the Agent and the Banks and shall be
satisfactory in form and substance to the Agent.
(C) A certificate, signed by a Designated Officer of the
Company, stating that on the date hereof no Default or Event of Default
has occurred and is continuing.
(D) Evidence satisfactory to the Agent that the "Term Loans"
under (and as defined in) the Inventory Term Loan Agreement shall
simultaneously with any Deferred Draw Term Loan hereunder pursuant to
any Incremental Deferred Draw Commitment be permanently prepaid in an
amount equal to $55,000,000.
11.3 Each Term Loan. The Banks shall not be required to make
any Term Loan unless on the applicable Borrowing Date, (i) no Default or Event
of Default exists, (ii) the representations and warranties contained in Article
V (but (i) excluding, with respect to any Term Loan made pursuant to an
Incremental Deferred Draw Commitment, those contained in the second sentence of
Section 5.5 and in Section 5.6 and (ii) solely with respect to any Term Loan
made pursuant to a Deferred Draw Term Loan Commitment, without giving effect to
any restatement described in the third parenthetical of the first sentence of
Section 5.5 reflecting a financial condition of the Borrower and its
Subsidiaries that is not acceptable to the Agent and the Banks) are true and
correct as of such Borrowing Date, (iii) after giving effect to such Term Loan
the aggregate outstanding Term Loans, plus all accrued and unpaid Commitment
Fees and
33
interest hereunder, will not exceed the face amount of all Bonds and (iv) all
legal matters incident to the making of such Term Loan are satisfactory to the
Banks and their counsel. Each Borrowing Notice shall constitute a representation
and warranty by the Company that the conditions contained in subsections (i),
(ii) and (iii) above will be satisfied on the relevant Borrowing Date. For the
avoidance of doubt, the conversion or continuation of an Term Loan shall not be
considered the making of a Term Loan.
7 ARTICLE XII: GENERAL PROVISIONS
12.1 Successors and Assigns. (A) The terms and provisions of
the Credit Documents shall be binding upon and inure to the benefit of the
Company and the Banks and their respective successors and assigns, except that
the Company shall not have the right to assign its rights under the Credit
Documents. Any Bank may sell participations in all or a portion of its rights
and obligations under this Agreement pursuant to subsection (B) below and any
Bank may assign all or any part of its rights and obligations under this
Agreement pursuant to subsection (C) below.
(B) Any Bank may sell participations to one or more banks or
other entities (each a "Participant ") in all or a portion of its
rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitments and its outstanding
Term Loans), provided that (i) such Bank's obligations under this
Agreement (including, without limitation, its Commitments to the
Company hereunder) shall remain unchanged, (ii) such Bank shall remain
solely responsible to the other parties hereto for the performance of
such obligations, (iii) such Bank shall remain the holder of the
outstanding Term Loans of such Bank for all purposes of this Agreement
and (iv) the Company shall continue to deal solely and directly with
such Bank in connection with such Bank's rights and obligations under
this Agreement. Each Bank shall retain the sole right to approve,
without the consent of any Participant, any amendment, modification or
waiver of any provision of the Credit Documents other than any
amendment, modification or waiver with respect to any Term Loan or
Commitments in which such Participant has an interest which would
require consent of all of the Banks pursuant to the terms of Section
10.1 or of any other Credit Document. The Company agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 12.11 in respect of its participating interest in amounts owing
under the Credit Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Bank under the
Credit Documents, provided that each Bank shall retain the right of
setoff provided in Section 12.11 with respect to the amount of
participating interests sold to each Participant. The Banks agree to
share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 12.11, agrees to share with each
Bank, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 12.11 as
if each Participant were a Bank. The Company further agrees that each
Participant shall be entitled to the benefits of Sections 4.1, 4.3, 4.4
and 4.5 to the same extent as if it were a Bank and had acquired its
interest by assignment pursuant to Section 12.1(C), provided that (i) a
Participant shall not be entitled to receive any greater payment under
Section 4.1, 4.3, 4.4 or 4.5 than the Bank who sold the participating
interest to such Participant would have received had it retained such
interest for its own account, unless the sale of such interest to such
Participant is
34
made with the prior written consent of the Company, and (ii) any
Participant not incorporated under the laws of the United States of
America or any State thereof agrees to comply with the provisions of
Section 4.5 to the same extent as if it were a Bank.
(C) Any Bank may, in the ordinary course of its business and
in accordance with applicable law, at any time assign to one or more
financial institutions all or any part of its rights and obligations
under this Agreement, provided that (i) such Bank has received the
Agent's prior written consent to such assignment, which consent shall
not be unreasonably withheld, and (ii) the minimum principal amount of
any such assignment (other than assignments to a Federal Reserve Bank,
or to any other Bank or affiliate of such assigning Bank, or to any
direct or indirect contractual counterparties in swap agreements
relating to the Term Loans to the extent required in connection with
the physical settlement of any Bank's obligations pursuant thereto)
shall be $1,000,000 (or such lesser amount consented to by the Agent);
provided, that after giving effect to such assignment the assigning
Bank shall have Commitments and Term Loans in the aggregate of not less
than $1,000,000 (unless otherwise consented to by the Agent).
Notwithstanding the foregoing sentence, any Bank may at any time,
without the consent of the Company or the Agent, assign all or any
portion of its rights under this Agreement to (i) a Federal Reserve
Bank, provided that no such assignment shall release the transferor
Bank from its obligations hereunder; and (ii) any Bank or any affiliate
of such assigning Bank, provided that the creditworthiness of such
affiliate (as determined in accordance with customary standards of the
banking industry) is no less than that of the assigning Bank; and (iii)
any direct or indirect contractual counterparties in swap agreements
relating to the Term Loans to the extent required in connection with
the physical settlement of any Bank's obligations pursuant thereto.
(D) Any Bank may, in connection with any sale or participation
or proposed sale or participation pursuant to this Section 12.1,
disclose to the purchaser or participant or proposed purchaser or
participant any information relating to the Company furnished to such
Bank by or on behalf of the Company, provided that prior to any such
disclosure of non-public information, the purchaser or participant or
proposed purchaser or participant (which purchaser or participant is
not an affiliate of a Bank) shall agree to preserve the confidentiality
of any confidential information (except any such disclosure as may be
required by law or regulatory process) relating to the Company received
by it from such Bank.
(E) Assignments under this Section 12.1 shall be made pursuant
to an agreement ("Assignment Agreement") substantially in the form of
Exhibit D hereto or in such other form as may be agreed to by the
parties thereto and shall not be effective until a $3,500 fee has been
paid to the Agent by the assignee, which fee shall cover the cost of
processing such assignment, provided that such fee shall not be
incurred in the event of an assignment by any Bank of all or a portion
of its rights under this Agreement to (i) a Federal Reserve Bank or
(ii) a Bank or an affiliate of the assigning Bank or (iii) to any
direct or indirect contractual counterparties in swap agreements
relating to the Term Loans to the extent required in connection with
the physical settlement of any Bank's obligations pursuant thereto.
35
12.2 Survival of Representations. All representations and
warranties of the Company contained in this Agreement shall survive the making
of the Term Loans herein contemplated.
12.3 Governmental Regulation. Anything contained in this
Agreement to the contrary notwithstanding, no Bank shall be obligated to extend
credit to the Company in violation of any limitation or prohibition provided by
any applicable statute or regulation.
12.4 Taxes. Any taxes (excluding income taxes) payable or
ruled payable by any Federal or State authority in respect of the execution of
the Credit Documents shall be paid by the Company, together with interest and
penalties, if any.
12.5 Choice of Law; Waiver of Jury Trial. THE CREDIT DOCUMENTS
SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING, WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF NEW YORK, BUT
OTHERWISE WITHOUT REGARD TO THE LAW OF CONFLICTS) OF THE STATE OF NEW YORK, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS. THE COMPANY HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES
FEDERAL OR NEW YORK STATE COURT SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO ANY CREDIT DOCUMENT AND THE COMPANY
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT. THE COMPANY HEREBY
WAIVES ANY RIGHT TO A JURY TRIAL IN ANY ACTION OR ARISING HEREUNDER OR UNDER ANY
CREDIT DOCUMENT.
12.6 Headings. Section headings in the Credit Documents are
for convenience of reference only, and shall not govern the interpretation of
any of the provisions of the Credit Documents.
12.7 Entire Agreement. The Credit Documents embody the entire
agreement and understanding between the Company, the Agent and the Banks and
supersede all prior agreements and understandings between the Company, the Agent
and the Banks relating to the subject matter thereof (other than those contained
in the fee letter described in Section 13.12 which shall survive and remain in
full force and effect during the term of this Agreement).
12.8 Expenses; Indemnification. The Company shall reimburse
the Agent and the Arrangers for (a) any reasonable costs, internal charges and
out-of-pocket expenses (including reasonable attorneys' fees and time charges of
attorneys for the Agent) paid or incurred by the Agent or the Arrangers in
connection with the preparation, review, execution, delivery, syndication,
distribution (including, without limitation, via the internet), amendment and
modification of the Credit Documents and (b) any reasonable costs, internal
charges and out-of-pocket expenses (including reasonable attorneys' fees and
time charges of attorneys for the Agent) paid or incurred by the Agent or the
Arrangers on its own behalf or on behalf of any Bank in connection with the
collection and enforcement of the Credit Documents. The Company further agrees
to indemnify the Agent, the Arrangers and each Bank and their respective
36
directors, officers and employees against all losses, claims, damages,
penalties, judgments, liabilities and reasonable expenses (including, without
limitation, all material expenses of litigation or preparation therefor whether
or not the Agent, the Arrangers or any Bank is a party thereto) which any of
them may pay or incur arising out of or relating to this Agreement, the other
Credit Documents, the transactions contemplated hereby or the direct or indirect
application or proposed application of the proceeds of any Term Loan hereunder,
provided that the Company shall not be liable for any of the foregoing to the
extent they arise from the gross negligence or willful misconduct of the Agent,
the Arrangers or any Bank. The obligations of the Company under this Section
shall survive the termination of this Agreement.
12.9 [Intentionally Omitted]
12.10 Severability of Provisions. Any provision in any Credit
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 Credit Documents are
declared to be severable.
12.11 Setoff. In addition to, and without limitation of, any
rights of the Banks under applicable law, if the Company becomes insolvent,
however evidenced, or any Default or Event of Default occurs, any indebtedness
from any Bank to the Company (including all account balances, whether
provisional or final and whether or not collected or available) may be offset
and applied toward the payment of the Obligations owing to such Bank, whether or
not the Obligations, or any part hereof, shall then be due. The Company agrees
that any purchaser or participant under Section 12.1 may, to the fullest extent
permitted by law, exercise all its rights of payment with respect to such
purchase or participation as if it were the direct creditor of the Company in
the amount of such purchase or participation.
12.12 Ratable Payments. If any Bank, whether by setoff or
otherwise, has payment made to it upon its outstanding Term Loans in a greater
proportion than that received by any other Bank, such Bank agrees, promptly upon
demand, to purchase a portion of the aggregate outstanding Term Loans held by
the other Banks so that after such purchase each Bank will hold its Pro Rata
Share of the aggregate outstanding Term Loans. If any Bank, 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 Bank agrees, promptly upon demand, to take
such action necessary such that all Banks share in the benefits of such
collateral ratably in proportion to their respective Pro Rata Share of the
aggregate outstanding Term Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made.
12.13 Nonliability of Banks. The relationship between the
Company, on the one hand, and the Banks and the Agent, on the other hand, shall
be solely that of borrower and lender. Neither the Agent, the Arrangers nor any
Bank shall have any fiduciary responsibilities to the Company. Neither the
Agent, the Arrangers nor any Bank undertakes any responsibility to the Company
to review or inform the Company of any matter in connection with any phase of
the Company's business or operations. The Company shall rely entirely upon its
own judgment with respect to its business, and any review, inspection,
supervision or information supplied to
37
the Company by the Banks is for the protection of the Banks and neither the
Company nor any third party is entitled to rely thereon. The Company agrees that
neither the Agent, the Arrangers nor any Bank shall have liability to the
Company (whether sounding in tort, contract or otherwise) for losses suffered by
the Company in connection with, arising out of, or in any way related to, the
transactions contemplated and the relationship established by the Credit
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
Agent, the Arrangers nor any Bank shall have any liability with respect to, and
the Company hereby waives, releases and agrees not to sue for, any special,
indirect, consequential or punitive damages suffered by the Company in
connection with, arising out of, or in any way related to the Credit Documents
or the transactions contemplated thereby.
ARTICLE XIII: THE AGENT
13.1 Appointment. Bank One, NA (Main Office - Chicago) is
hereby appointed Agent hereunder, and each of the Banks irrevocably authorizes
the Agent to act as the contractual representative on behalf of such Bank. The
Agent agrees to act as such upon the express conditions contained in this
Article XIII. The Agent shall not have a fiduciary relationship in respect of
any Bank by reason of this Agreement.
13.2 Powers. The Agent shall have and may exercise such powers
hereunder as are specifically delegated to the Agent by the terms hereof,
together with such powers as are reasonably incidental thereto. The Agent shall
not have any implied duties to the Banks or any obligation to the Banks to take
any action hereunder except any action specifically provided by this Agreement
to be taken by the Agent.
13.3 General Immunity. Neither the Agent nor any of its
directors, officers, agents or employees shall be liable to the Banks or any
Bank for any action taken or omitted to be taken by it or them hereunder or in
connection herewith except for its or their own gross negligence or willful
misconduct.
13.4 No Responsibility for Loans, Recitals, Etc. The Agent
shall not be responsible to the Banks for any recitals, reports, statements,
warranties or representations herein or in any Credit Document or be bound to
ascertain or inquire as to the performance or observance of any of the terms of
this Agreement.
13.5 Action on Instructions of Banks. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder and
under any other Credit Document in accordance with written instructions signed
by the Majority Banks (or all of the Banks if required by Section 10.1), and
such instructions and any action taken or failure to act pursuant thereto shall
be binding on all of the Banks. The Banks hereby acknowledge that the 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 Credit Document
unless it shall be requested in writing to do so by the Majority Banks. The
Agent shall be fully justified in failing or refusing to take any action
hereunder and under any other Credit Document unless it shall first be
38
indemnified to its satisfaction by the Banks 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.
13.6 Employment of Agents and Counsel. The Agent may execute
any of its duties as Agent hereunder by or through employees, agents and
attorneys-in-fact and shall not be answerable to the Banks, 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 Agent shall be entitled to advice of counsel concerning all
matters pertaining to the agency hereby created and its duties hereunder.
13.7 Reliance on Documents; Counsel. The Agent shall be
entitled to rely upon any 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 Agent, which
counsel may be employees of the Agent.
13.8 Agent's Reimbursement and Indemnification. The Banks
agree to reimburse and indemnify the Agent ratably in proportion to their
respective Pro Rata Shares (i) for any amounts not reimbursed by the Company for
which the Agent is entitled to reimbursement by the Company under the Credit
Documents, (ii) for any other expenses reasonably incurred by the Agent on
behalf of the Banks, in connection with the preparation, execution, delivery,
administration and enforcement of the Credit Documents, and for which the Agent
is not entitled to reimbursement by the Company under the Credit Documents, 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 Agent in
any way relating to or arising out of this Agreement or any other document
delivered in connection with this Agreement or the transactions contemplated
hereby or the enforcement of any of the terms hereof or of any such other
documents, and for which the Agent is not entitled to reimbursement by the
Company under the Credit Documents, provided that no Bank shall be liable for
any of the foregoing to the extent they arise from the gross negligence or
willful misconduct of the Agent.
13.9 Rights as a Bank. With respect to its Commitments and any
Term Loan made by it, the Agent shall have the same rights and powers hereunder
as any Bank and may exercise the same as though it were not the Agent, and the
term "Bank" or "Banks" shall, unless the context otherwise indicates, include
Bank One in its individual capacity. The Agent may accept deposits from, lend
money to, and generally engage in any kind of banking or trust business with the
Company or any Subsidiary as if it were not the Agent.
13.10 Bank Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Agent or any other Bank and
based on the financial statements prepared by the Company and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Bank also acknowledges
that it will, independently and without reliance upon the Agent or any other
Bank 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.
39
13.11 Successor Agent. The Agent may resign at any time by
giving written notice thereof to the Banks and the Company, and the Agent may be
removed at any time with or without cause by written notice received by the
Agent from the Majority Banks. Upon any such resignation or removal, the
Majority Banks shall have the right to appoint, on behalf of the Banks, a
successor Agent. If no successor Agent shall have been so appointed by the
Majority Banks and shall have accepted such appointment within thirty days after
the retiring Agent's giving notice of resignation, then the retiring Agent may
appoint, on behalf of the Banks, a successor Agent. Such successor Agent shall
be a commercial bank having capital and retained earnings of at least
$500,000,000. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article XIII shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
the Agent hereunder.
13.12 Agent and Arrangers Fees. The Company agrees to pay to
the Agent and Banc One Capital Markets, Inc. and Barclays Capital (together, the
"Arrangers"), for their respective accounts, the fees agreed to by the Company,
the Agent and the Arrangers pursuant to that certain letter agreement dated
October 17, 2002, or as otherwise agreed from time to time.
ARTICLE XIV: NOTICES
14.1 Giving Notice. Except as otherwise permitted by Section
2.1 and 2.2 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 Company or the Agent, at its address or
facsimile number set forth on the signature pages hereof, (y) in the case of any
Bank, at its address or facsimile number set forth below its signature hereto 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 Agent and the
Company in accordance with the provisions of this Section 14.1. 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 Agent under
Article II shall not be effective until received.
14.2 Change of Address. The Company, the Agent and any Bank
may each change the address for service of notice upon it by a notice in writing
to the other parties hereto.
[Remainder of Page Intentionally Left Blank ]
40
ARTICLE XV: COUNTERPARTS
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 be effective when it has been executed by the Company, the Agent
and the Banks and each party has notified the Agent by facsimile or telephone
that it has taken such action.
IN WITNESS WHEREOF, the Company, the Banks and the Agent have executed
this Agreement as of the date first above written.
CONSUMERS ENERGY COMPANY
By: /s/ LAURA L. MOUNTCASTLE
---------------------------------------
Name: Laura L. Mountcastle
Title: Vice President and Treasurer
212 West Michigan Avenue
Jackson, MI 49201
Attention: James L. Loewen
Facsimile No.: (517) 788-7080
Confirmation (Phone) No: (517) 788-2286
E-Mail Address: jlloewen@cmsenergy.com
41
BANK ONE, NA (MAIN OFFICE -
CHICAGO), Individually and as Agent
By: /s/ JANE A. BEK
---------------------------------------
Name: Jane. A. Bek
Title: Director
ADDRESS:
Bank One Plaza
Chicago, Illinois 60670
Attention: Jane A. Bek
Facsimile No.: (312) 732-5435
Confirmation (Phone) No: (312) 732-3422
E-Mail Address: Jane_Bek@bankone.com
42
BARCLAYS BANK PLC
By: /s/ SYDNEY DENNIS
---------------------------------------
Name: Sydney Dennis
Title: Director
ADDRESS:
222 Broadway
New York, NY 10038
Attention: Sydney Dennis
Facsimile No.: (212) 412-7511
Confirmation (Phone) No: (212) 412-2470
E-Mail Address: sydney.dennis@barcap.com
43
EXHIBIT A-1
[FORM OF SUPPLEMENTAL INDENTURE]
================================================================================
EIGHTY-FIFTH SUPPLEMENTAL INDENTURE
Providing among other things for
FIRST MORTGAGE BONDS,
Collateral Series due 2003
--------------------------------
Dated as of October 17, 2002
--------------------------------
CONSUMERS ENERGY COMPANY
TO
JPMORGAN CHASE BANK,
TRUSTEE
================================================================================
Counterpart ____ of 85
EIGHTY-FIFTH SUPPLEMENTAL INDENTURE
PROVIDING AMONG OTHER THINGS FOR
FIRST MORTGAGE BONDS,
COLLATERAL SERIES DUE 2003
--------------
DATED AS OF OCTOBER 17, 2002
--------------
CONSUMERS ENERGY COMPANY
TO
JPMORGAN CHASE BANK,
TRUSTEE
Counterpart _____ of 85
THIS EIGHTY-FIFTH SUPPLEMENTAL INDENTURE, dated as of October 17, 2002
(herein sometimes referred to as "this Supplemental Indenture"), made and
entered into by and between CONSUMERS ENERGY COMPANY, a corporation organized
and existing under the laws of the State of Michigan, with its principal
executive office and place of business at 212 West Michigan Avenue, in Jackson,
Jackson County, Michigan 49201, formerly known as Consumers Power Company
(hereinafter sometimes referred to as the "Company"), and JPMORGAN CHASE BANK, a
corporation organized and existing under the laws of the State of New York, with
its corporate trust offices at 450 W. 33rd Street, in the Borough of Manhattan,
The City of New York, New York 10001 (hereinafter sometimes referred to as the
"Trustee"), as Trustee under the Indenture dated as of September 1, 1945 between
Consumers Power Company, a Maine corporation (hereinafter sometimes referred to
as the "Maine corporation"), and City Bank Farmers Trust Company (Citibank,
N.A., successor, hereinafter sometimes referred to as the "Predecessor
Trustee"), securing bonds issued and to be issued as provided therein
(hereinafter sometimes referred to as the "Indenture"),
WHEREAS at the close of business on January 30, 1959, City Bank Farmers
Trust Company was converted into a national banking association under the title
"First National City Trust Company"; and
WHEREAS at the close of business on January 15, 1963, First National
City Trust Company was merged into First National City Bank; and
WHEREAS at the close of business on October 31, 1968, First National
City Bank was merged into The City Bank of New York, National Association, the
name of which was thereupon changed to First National City Bank; and
WHEREAS effective March 1, 1976, the name of First National City Bank
was changed to Citibank, N.A.; and
WHEREAS effective July 16, 1984, Manufacturers Hanover Trust Company
succeeded Citibank, N.A. as Trustee under the Indenture; and
WHEREAS effective June 19, 1992, Chemical Bank succeeded by merger to
Manufacturers Hanover Trust Company as Trustee under the Indenture; and
WHEREAS effective July 15, 1996, The Chase Manhattan Bank (National
Association), merged with and into Chemical Bank which thereafter was renamed
The Chase Manhattan Bank; and
WHEREAS effective November 11, 2001, The Chase Manhattan Bank merged
with Morgan Guaranty Trust Company of New York and the surviving corporation was
renamed JPMorgan Chase Bank; and
WHEREAS the Indenture was executed and delivered for the purpose of
securing such bonds as may from time to time be issued under and in accordance
with the terms of the Indenture, the aggregate principal amount of bonds to be
secured thereby being limited to $5,000,000,000 at any one time outstanding
(except as provided in Section 2.01 of the Indenture), and the Indenture
describes and sets forth the property conveyed thereby and is filed in the
Office of the Secretary of State of the State of Michigan and is of record in
the Office of
-1-
the Register of Deeds of each county in the State of Michigan in which this
Supplemental Indenture is to be recorded; and
WHEREAS the Indenture has been supplemented and amended by various
indentures supplemental thereto, each of which is filed in the Office of the
Secretary of State of the State of Michigan and is of record in the Office of
the Register of Deeds of each county in the State of Michigan in which this
Supplemental Indenture is to be recorded; and
WHEREAS the Company and the Maine corporation entered into an Agreement
of Merger and Consolidation, dated as of February 14, 1968, which provided for
the Maine corporation to merge into the Company; and
WHEREAS the effective date of such Agreement of Merger and
Consolidation was June 6, 1968, upon which date the Maine corporation was merged
into the Company and the name of the Company was changed from "Consumers Power
Company of Michigan" to "Consumers Power Company"; and
WHEREAS the Company and the Predecessor Trustee entered into a
Sixteenth Supplemental Indenture, dated as of June 4, 1968, which provided,
among other things, for the assumption of the Indenture by the Company; and
WHEREAS said Sixteenth Supplemental Indenture became effective on the
effective date of such Agreement of Merger and Consolidation; and
WHEREAS the Company has succeeded to and has been substituted for the
Maine corporation under the Indenture with the same effect as if it had been
named therein as the mortgagor corporation; and
WHEREAS effective March 11, 1997, the name of Consumers Power Company
was changed to Consumers Energy Company; and
WHEREAS, the Company has entered into a Term Loan Agreement dated as of
October 17, 2002 (as amended or otherwise modified from time to time, the "Term
Loan Agreement") among the Company, various financial institutions and Bank One,
NA (Main Office - Chicago), as administrative agent (in such capacity, the
"Agent") for the Banks (as such term is defined in the Term Loan Agreement)
providing for the making of certain financial accommodations thereunder, and
pursuant to such Term Loan Agreement the Company has agreed to issue to the
Agent, as evidence of and security for the Obligations (as such term is defined
in the Term Loan Agreement), a new series of bonds under the Indenture; and
WHEREAS, for such purposes the Company desires to issue a new series of
bonds, to be designated First Mortgage Bonds, Collateral Series due 2003, each
of which bonds shall also bear the descriptive title "First Mortgage Bond"
(hereinafter provided for and hereinafter sometimes referred to as the "2003
Collateral Series Bonds"), the bonds of which series are to be issued as
registered bonds without coupons and are to bear interest at the rate per annum
specified herein and are to mature April 15, 2003; and
WHEREAS, each of the registered bonds without coupons of the 2003
Collateral Series Bonds and the Trustee's Authentication Certificate thereon are
to be substantially in the following form, to wit:
-2-
[FORM OF REGISTERED BOND OF THE 2003 COLLATERAL SERIES BONDS]
[FACE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND
COLLATERAL SERIES DUE 2003
No. 1 $70,000,000
CONSUMERS ENERGY COMPANY, a Michigan corporation (hereinafter called
the "Company"), for value received, hereby promises to pay to Bank One, NA, as
agent (in such capacity, the "Agent") for the Banks under and as defined in the
Term Loan Agreement dated as of October 17, 2002 among the Company, the Banks
and the Agent (as amended or otherwise modified from time to time, the "Term
Loan Agreement"), or registered assigns, the principal sum of Seventy Million
Dollars ($70,000,000) or such lesser principal amount as shall be equal to the
aggregate principal amount of the Term Loans (as defined in the Term Loan
Agreement) included in the Obligations (as defined in the Term Loan Agreement)
outstanding on April 15, 2003 (the "Maturity Date"), but not in excess, however,
of the principal amount of this bond, and to pay interest thereon at the
Interest Rate (as defined below) until the principal hereof is paid or duly made
available for payment on the Maturity Date, or, in the event of redemption of
this bond, until the redemption date, or, in the event of default in the payment
of the principal hereof, until the Company's obligations with respect to the
payment of such principal shall be discharged as provided in the Indenture (as
defined on the reverse hereof). Interest on this bond shall be payable on each
Interest Payment Date (as defined below), commencing on the first Interest
Payment Date next succeeding October 17, 2002. If the Maturity Date falls on a
day which is not a Business Day, as defined below, principal and any interest
and/or fees payable with respect to the Maturity Date will be paid on the
immediately preceding Business Day. The interest payable, and punctually paid or
duly provided for, on any Interest Payment Date will, subject to certain
exceptions, be paid to the person in whose name this bond (or one or more
predecessor bonds) is registered at the close of business on the Record Date (as
defined below); provided, however, that interest payable on the Maturity Date
will be payable to the person to whom the principal hereof shall be payable.
Should the Company default in the payment of interest ("Defaulted Interest"),
the Defaulted Interest shall be paid to the person in whose name this bond (or
one or more predecessor bonds) is registered on a subsequent record date fixed
by the Company, which subsequent record date shall be fifteen (15) days prior to
the payment of such Defaulted Interest. As used herein, (A) "Business Day" shall
mean any day, other than a Saturday or Sunday, on which banks generally are open
in Chicago, Illinois and New York, New York for the conduct of substantially all
of their commercial lending activities and on which interbank wire transfers can
be made on the Fedwire system; (B) "Interest Payment Date" shall mean each date
on which interest and/or fees under the Term Loan Agreement are due and payable
from time to time pursuant to the Term Loan Agreement; (C) "Interest Rate" shall
mean a rate of interest per annum, adjusted as necessary, to result in an
interest payment equal to the aggregate amount of interest and fees due under
the Term Loan Agreement on the applicable Interest Payment Date; and (D) "Record
Date" with respect to any Interest Payment Date shall
-3-
mean the day (whether or not a Business Day) immediately next preceding such
Interest Payment Date.
Payment of the principal of and interest on this bond will be made in
immediately available funds at the office or agency of the Company maintained
for that purpose in the City of Jackson, Michigan, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.
The provisions of this bond are continued on the reverse hereof and
such continued provisions shall for all purposes have the same effect as though
fully set forth at this place.
This bond shall not be valid or become obligatory for any purpose
unless and until it shall have been authenticated by the execution by the
Trustee or its successor in trust under the Indenture of the certificate hereon.
IN WITNESS WHEREOF, Consumers Energy Company has caused this bond to be
executed in its name by its Chairman of the Board, its President or one of its
Vice Presidents by his or her signature or a facsimile thereof, and its
corporate seal or a facsimile thereof to be affixed hereto or imprinted hereon
and attested by its Secretary or one of its Assistant Secretaries by his or her
signature or a facsimile thereof.
CONSUMERS ENERGY COMPANY
Dated:
By: _________________________
Printed: ____________________
Title: ______________________
Attest: _________________________
TRUSTEE'S AUTHENTICATION CERTIFICATE
This is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.
JPMORGAN CHASE BANK, Trustee
By _________________________________
Authorized Officer
-4-
[REVERSE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND
COLLATERAL SERIES DUE 2003
This bond is one of the bonds of a series designated as First Mortgage
Bonds, Collateral Series due 2003 (sometimes herein referred to as the "2003
Collateral Series Bonds") issued under and in accordance with and secured by an
Indenture dated as of September 1, 1945, given by the Company (or its
predecessor, Consumers Power Company, a Maine corporation) to City Bank Farmers
Trust Company (JPMorgan Chase Bank, successor) (hereinafter sometimes referred
to as the "Trustee"), together with indentures supplemental thereto, heretofore
or hereafter executed, to which indenture and indentures supplemental thereto
(hereinafter referred to collectively as the "Indenture") reference is hereby
made for a description of the property mortgaged and pledged, the nature and
extent of the security and the rights, duties and immunities thereunder of the
Trustee and the rights of the holders of said bonds and of the Trustee and of
the Company in respect of such security, and the limitations on such rights. By
the terms of the Indenture, the bonds to be secured thereby are issuable in
series which may vary as to date, amount, date of maturity, rate of interest and
in other respects as provided in the Indenture.
The 2003 Collateral Series Bonds are to be issued and delivered to the
Agent in order to evidence and secure the obligation of the Company under the
Term Loan Agreement to make payments to the Banks under the Term Loan Agreement
and to provide the Banks the benefit of the lien of the Indenture with respect
to the 2003 Collateral Series Bonds.
The obligation of the Company to make payments with respect to the
principal of 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with respect to the principal of the 2003
Collateral Series Bonds shall be deemed discharged in the same amount as the
payment with respect to the Term Loans discharges the outstanding obligation
with respect to such Term Loans.
The obligation of the Company to make payments with respect to the
interest on 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2003 Collateral Series
-5-
Bonds shall be deemed discharged in the same amount as the payment with respect
to the Term Loans discharges the outstanding obligation with respect to such
Term Loans.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on this bond, so far as such payments at the time have become due, has
been fully satisfied and discharged unless and until the Trustee shall have
received a written notice from the Agent stating (i) that timely payment of
principal and interest on the 2003 Collateral Series Bonds has not been made,
(ii) that the Company is in arrears as to the payments required to be made by it
to the Agent in connection with the Obligations pursuant to the Term Loan
Agreement, and (iii) the amount of the arrearage.
If an Event of Default (as defined in the Term Loan Agreement) with
respect to the payment of the principal of any Term Loans shall have occurred,
it shall be deemed to be a default for purposes of Section 11.01 of the
Indenture in the payment of the principal of the 2003 Collateral Series Bonds
equal to the amount of such unpaid principal (but in no event in excess of the
principal amount of the 2003 Collateral Series Bonds). If an Event of Default
(as defined in the Term Loan Agreement) with respect to the payment of interest
on any Term Loans or fees shall have occurred, it shall be deemed to be a
default for purposes of Section 11.01 of the Indenture in the payment of the
interest on the 2003 Collateral Series Bonds equal to the amount of such unpaid
interest or fees.
This bond is not redeemable except upon written demand of the Agent
following the occurrence of an Event of Default under the Term Loan Agreement
and the acceleration of the Obligations, as provided in Section 9.2 of the Term
Loan Agreement. This bond is not redeemable by the operation of the improvement
fund or the maintenance and replacement provisions of the Indenture or with the
proceeds of released property.
In case of certain defaults as specified in the Indenture, the
principal of this bond may be declared or may become due and payable on the
conditions, at the time, in the manner and with the effect provided in the
Indenture. The holders of certain specified percentages of the bonds at the time
outstanding, including in certain cases specified percentages of bonds of
particular series, may in certain cases, to the extent and as provided in the
Indenture, waive certain defaults thereunder and the consequences of such
defaults.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than seventy-five per
centum in principal amount of the bonds (exclusive of bonds disqualified by
reason of the Company's interest therein) at the time outstanding, including, if
more than one series of bonds shall be at the time outstanding, not less than
sixty per centum in principal amount of each series affected, to effect, by an
indenture supplemental to the Indenture, modifications or alterations of the
Indenture and of the rights and obligations of the Company and the rights of the
holders of the bonds and coupons; provided, however, that no such modification
or alteration shall be made without the written approval or consent of the
holder hereof which will (a) extend the maturity of this bond or reduce the rate
or extend the time of payment of interest hereon or reduce the amount of the
principal hereof, or (b) permit the creation of any lien, not otherwise
permitted, prior to or on a parity with the lien of the
-6-
Indenture, or (c) reduce the percentage of the principal amount of the bonds the
holders of which are required to approve any such supplemental indenture.
The Company reserves the right, without any consent, vote or other
action by holders of the 2003 Collateral Series Bonds or any other series
created after the Sixty-eighth Supplemental Indenture to amend the Indenture to
reduce the percentage of the principal amount of bonds the holders of which are
required to approve any supplemental indenture (other than any supplemental
indenture which is subject to the proviso contained in the immediately preceding
sentence) (a) from not less than seventy-five per centum (including sixty per
centum of each series affected) to not less than a majority in principal amount
of the bonds at the time outstanding or (b) in case fewer than all series are
affected, not less than a majority in principal amount of the bonds of all
affected series, voting together.
No recourse shall be had for the payment of the principal of or
interest on this bond, or for any claim based hereon, or otherwise in respect
hereof or of the Indenture, to or against any incorporator, stockholder,
director or officer, past, present or future, as such, of the Company, or of any
predecessor or successor company, either directly or through the Company, or
such predecessor or successor company, or otherwise, under any constitution or
statute or rule of law, or by the enforcement of any assessment or penalty, or
otherwise, all such liability of incorporators, stockholders, directors and
officers, as such, being waived and released by the holder and owner hereof by
the acceptance of this bond and being likewise waived and released by the terms
of the Indenture.
This bond shall be exchangeable for other registered bonds of the same
series, in the manner and upon the conditions prescribed in the Indenture, upon
the surrender of such bonds at the Investor Services Department of the Company,
as transfer agent. However, notwithstanding the provisions of Section 2.05 of
the Indenture, no charge shall be made upon any registration of transfer or
exchange of bonds of said series other than for any tax or taxes or other
governmental charge required to be paid by the Company.
The Agent shall surrender this bond to the Trustee when all of the
principal of and interest on the Term Loans arising under the Term Loan
Agreement, and all of the fees payable pursuant to the Term Loan Agreement,
shall have been duly paid, and the Term Loan Agreement shall have been
terminated.
[END OF FORM OF REGISTERED BOND OF THE 2003 COLLATERAL SERIES BONDS]
- - - - - - - - - - - - -
-7-
AND WHEREAS all acts and things necessary to make the 2003 Collateral
Series Bonds, when duly executed by the Company and authenticated by the Trustee
or its agent and issued as prescribed in the Indenture, as heretofore
supplemented and amended, and this Supplemental Indenture provided, the valid,
binding and legal obligations of the Company, and to constitute the Indenture,
as supplemented and amended as aforesaid, as well as by this Supplemental
Indenture, a valid, binding and legal instrument for the security thereof, have
been done and performed, and the creation, execution and delivery of this
Supplemental Indenture and the creation, execution and issuance of bonds subject
to the terms hereof and of the Indenture, as so supplemented and amended, have
in all respects been duly authorized;
NOW, THEREFORE, in consideration of the premises, of the acceptance and
purchase by the holders thereof of the bonds issued and to be issued under the
Indenture, as supplemented and amended as above set forth, and of the sum of One
Dollar duly paid by the Trustee to the Company, and of other good and valuable
considerations, the receipt whereof is hereby acknowledged, and for the purpose
of securing the due and punctual payment of the principal of and premium, if
any, and interest on all bonds now outstanding under the Indenture and the
$70,000,000 principal amount of the 2003 Collateral Series Bonds proposed to be
issued initially and all other bonds which shall be issued under the Indenture,
as supplemented and amended from time to time, and for the purpose of securing
the faithful performance and observance of all covenants and conditions therein,
and in any indenture supplemental thereto, set forth, the Company has given,
granted, bargained, sold, released, transferred, assigned, hypothecated,
pledged, mortgaged, confirmed, set over, warranted, alienated and conveyed and
by these presents does give, grant, bargain, sell, release, transfer, assign,
hypothecate, pledge, mortgage, confirm, set over, warrant, alien and convey unto
JPMorgan Chase Bank, as Trustee, as provided in the Indenture, and its successor
or successors in the trust thereby and hereby created and to its or their
assigns forever, all the right, title and interest of the Company in and to all
the property, described in Section 11 hereof, together (subject to the
provisions of Article X of the Indenture) with the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, excepting, however, the
property, interests and rights specifically excepted from the lien of the
Indenture as set forth in the Indenture.
TOGETHER WITH all and singular the tenements, hereditaments and
appurtenances belonging or in any wise appertaining to the premises, property,
franchises and rights, or any thereof, referred to in the foregoing granting
clause, with the reversion and reversions, remainder and remainders and (subject
to the provisions of Article X of the Indenture) the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, and all the estate,
right, title and interest and claim whatsoever, at law as well as in equity,
which the Company now has or may hereafter acquire in and to the aforesaid
premises, property, franchises and rights and every part and parcel thereof.
SUBJECT, HOWEVER, with respect to such premises, property, franchises
and rights, to excepted encumbrances as said term is defined in Section 1.02 of
the Indenture, and subject also to all defects and limitations of title and to
all encumbrances existing at the time of acquisition. TO HAVE AND TO HOLD all
said premises, property, franchises and rights hereby conveyed, assigned,
pledged or mortgaged, or intended so to be, unto the Trustee, its successor or
successors in trust and their assigns forever;
-8-
BUT IN TRUST, NEVERTHELESS, with power of sale for the equal and
proportionate benefit and security of the holders of all bonds now or hereafter
authenticated and delivered under and secured by the Indenture and interest
coupons appurtenant thereto, pursuant to the provisions of the Indenture and of
any supplemental indenture, and for the enforcement of the payment of said bonds
and coupons when payable and the performance of and compliance with the
covenants and conditions of the Indenture and of any supplemental indenture,
without any preference, distinction or priority as to lien or otherwise of any
bond or bonds over others by reason of the difference in time of the actual
authentication, delivery, issue, sale or negotiation thereof or for any other
reason whatsoever, except as otherwise expressly provided in the Indenture; and
so that each and every bond now or hereafter authenticated and delivered
thereunder shall have the same lien, and so that the principal of and premium,
if any, and interest on every such bond shall, subject to the terms thereof, be
equally and proportionately secured, as if it had been made, executed,
authenticated, delivered, sold and negotiated simultaneously with the execution
and delivery thereof.
AND IT IS EXPRESSLY DECLARED by the Company that all bonds
authenticated and delivered under and secured by the Indenture, as supplemented
and amended as above set forth, are to be issued, authenticated and delivered,
and all said premises, property, franchises and rights hereby and by the
Indenture and indentures supplemental thereto conveyed, assigned, pledged or
mortgaged, or intended so to be, are to be dealt with and disposed of under,
upon and subject to the terms, conditions, stipulations, covenants, agreements,
trusts, uses and purposes expressed in the Indenture, as supplemented and
amended as above set forth, and the parties hereto mutually agree as follows:
SECTION 1. There is hereby created one series of bonds (the "2003
Collateral Series Bonds") designated as hereinabove provided, which shall also
bear the descriptive title "First Mortgage Bond", and the form thereof shall be
substantially as hereinbefore set forth (the "Sample Bond"). The 2003 Collateral
Series Bonds shall be issued in the aggregate principal amount of $70,000,000,
shall mature on April 15, 2003 and shall be issued only as registered bonds
without coupons in denominations of $1,000 and any multiple thereof. The serial
numbers of the 2003 Collateral Series Bonds shall be such as may be approved by
any officer of the Company, the execution thereof by any such officer either
manually or by facsimile signature to be conclusive evidence of such approval.
The 2003 Collateral Series Bonds are to be issued to and registered in the name
of the Agent under the Term Loan Agreement (as such terms are defined in the
Sample Bond) to evidence and secure any and all Obligations (as such term is
defined in the Term Loan Agreement) of the Company under the Term Loan
Agreement.
The 2003 Collateral Series Bonds shall bear interest as set forth in
the Sample Bond. The principal of and the interest on said bonds shall be
payable as set forth in the Sample Bond.
The obligation of the Company to make payments with respect to the
principal of 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with respect to the principal of the 2003
Collateral Series Bonds shall be deemed discharged in the
-9-
same amount as the payment with respect to the Term Loans discharges the
outstanding obligation with respect to such Term Loans.
The obligation of the Company to make payments with respect to the
interest on 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2003 Collateral Series Bonds shall be deemed discharged in the
same amount as the payment with respect to the Term Loans discharges the
outstanding obligation with respect to such Term Loans.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on the 2003 Collateral Series Bonds, so far as such payments at the
time have become due, has been fully satisfied and discharged unless and until
the Trustee shall have received a written notice from the Agent stating (i) that
timely payment of principal and interest on the 2003 Collateral Series Bonds has
not been made, (ii) that the Company is in arrears as to the payments required
to be made by it to the Agent pursuant to the Term Loan Agreement, and (iii) the
amount of the arrearage.
The 2003 Collateral Series Bonds shall be exchangeable for other
registered bonds of the same series, in the manner and upon the conditions
prescribed in the Indenture, upon the surrender of such bonds at the Investor
Services Department of the Company, as transfer agent. However, notwithstanding
the provisions of Section 2.05 of the Indenture, no charge shall be made upon
any registration of transfer or exchange of bonds of said series other than for
any tax or taxes or other governmental charge required to be paid by the
Company.
SECTION 2. The 2003 Collateral Series Bonds are not redeemable by the
operation of the maintenance and replacement provisions of this Indenture or
with the proceeds of released property.
SECTION 3. Upon the occurrence of an Event of Default under the Term
Loan Agreement and the acceleration of the Obligations, the 2003 Collateral
Series Bonds shall be redeemable in whole upon receipt by the Trustee of a
written demand from the Agent stating that there has occurred under the Term
Loan Agreement both an Event of Default and a declaration of acceleration of the
Obligations and demanding redemption of the 2003 Collateral Series Bonds
(including a description of the amount of principal, interest and fees which
comprise such Obligations). The Company waives any right it may have to prior
notice of such redemption under the Indenture. Upon surrender of the 2003
Collateral Series Bonds by the Agent to the Trustee, the 2003 Collateral Series
Bonds shall be redeemed at a redemption price equal to the aggregate amount of
the Obligations.
SECTION 4. The Company reserves the right, without any consent, vote or
other action by the holder of the 2003 Collateral Series Bonds or of any
subsequent series of bonds issued under the Indenture, to make such amendments
to the Indenture, as supplemented, as shall be necessary in order to amend
Section 17.02 to read as follows:
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SECTION 17.02. With the consent of the holders of not less
than a majority in principal amount of the bonds at the time
outstanding or their attorneys-in-fact duly authorized, or, if fewer
than all series are affected, not less than a majority in principal
amount of the bonds at the time outstanding of each series the rights
of the holders of which are affected, voting together, the Company,
when authorized by a resolution, and the Trustee may from time to time
and at any time enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or modifying the rights and obligations of the
Company and the rights of the holders of any of the bonds and coupons;
provided, however, that no such supplemental indenture shall (1) extend
the maturity of any of the bonds or reduce the rate or extend the time
of payment of interest thereon, or reduce the amount of the principal
thereof, or reduce any premium payable on the redemption thereof,
without the consent of the holder of each bond so affected, or (2)
permit the creation of any lien, not otherwise permitted, prior to or
on a parity with the lien of this Indenture, without the consent of the
holders of all the bonds then outstanding, or (3) reduce the aforesaid
percentage of the principal amount of bonds the holders of which are
required to approve any such supplemental indenture, without the
consent of the holders of all the bonds then outstanding. For the
purposes of this Section, bonds shall be deemed to be affected by a
supplemental indenture if such supplemental indenture adversely affects
or diminishes the rights of holders thereof against the Company or
against its property. The Trustee may in its discretion determine
whether or not, in accordance with the foregoing, bonds of any
particular series would be affected by any supplemental indenture and
any such determination shall be conclusive upon the holders of bonds of
such series and all other series. Subject to the provisions of Sections
16.02 and 16.03 hereof, the Trustee shall not be liable for any
determination made in good faith in connection herewith.
Upon the written request of the Company, accompanied by a
resolution authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the
consent of bondholders as aforesaid (the instrument or instruments
evidencing such consent to be dated within one year of such request),
the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion but shall
not be obligated to enter into such supplemental indenture.
It shall not be necessary for the consent of the bondholders
under this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such consent
shall approve the substance thereof.
The Company and the Trustee, if they so elect, and either
before or after such consent has been obtained, may require the holder
of any bond consenting to the execution of any such supplemental
indenture to submit his bond to the Trustee or to ask such bank, banker
or trust company as may be designated by the Trustee
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for the purpose, for the notation thereon of the fact that the holder
of such bond has consented to the execution of such supplemental
indenture, and in such case such notation, in form satisfactory to the
Trustee, shall be made upon all bonds so submitted, and such bonds
bearing such notation shall forthwith be returned to the persons
entitled thereto.
Prior to the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the
Company shall publish a notice, setting forth in general terms the
substance of such supplemental indenture, at least once in one daily
newspaper of general circulation in each city in which the principal of
any of the bonds shall be payable, or, if all bonds outstanding shall
be registered bonds without coupons or coupon bonds registered as to
principal, such notice shall be sufficiently given if mailed, first
class, postage prepaid, and registered if the Company so elects, to
each registered holder of bonds at the last address of such holder
appearing on the registry books, such publication or mailing, as the
case may be, to be made not less than thirty days prior to such
execution. Any failure of the Company to give such notice, or any
defect therein, shall not, however, in any way impair or affect the
validity of any such supplemental indenture.
SECTION 5. As supplemented and amended as above set forth, the
Indenture is in all respects ratified and confirmed, and the Indenture and all
indentures supplemental thereto shall be read, taken and construed as one and
the same instrument.
SECTION 6. Nothing contained in this Supplemental Indenture shall, or
shall be construed to, confer upon any person other than a holder of bonds
issued under the Indenture, as supplemented and amended as above set forth, the
Company, the Trustee and the Agent, for the benefit of the Banks (as such term
is defined in the Term Loan Agreement), any right or interest to avail himself
of any benefit under any provision of the Indenture, as so supplemented and
amended.
SECTION 7. The Trustee assumes no responsibility for or in respect of
the validity or sufficiency of this Supplemental Indenture or of the Indenture
as hereby supplemented or the due execution hereof by the Company or for or in
respect of the recitals and statements contained herein (other than those
contained in the sixth, seventh and eighth recitals hereof), all of which
recitals and statements are made solely by the Company.
SECTION 8. This Supplemental Indenture may be simultaneously executed
in several counterparts and all such counterparts executed and delivered, each
as an original, shall constitute but one and the same instrument.
SECTION 9. In the event the date of any notice required or permitted
hereunder shall not be a Business Day, then (notwithstanding any other provision
of the Indenture or of any supplemental indenture thereto) such notice need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the date fixed for such notice.
"Business Day" means, with respect to this Section 9, any day, other than a
Saturday or Sunday, on which banks generally are open in Chicago, Illinois and
New York, New
-12-
York for the conduct of substantially all of their commercial lending activities
and on which interbank wire transfers can be made on the Fedwire system.
SECTION 10. This Supplemental Indenture and the 2003 Collateral Series
Bonds shall be governed by and deemed to be a contract under, and construed in
accordance with, the laws of the State of Michigan, and for all purposes shall
be construed in accordance with the laws of such state, except as may otherwise
be required by mandatory provisions of law.
SECTION 11. Detailed Description of Property Mortgaged:
I.
ELECTRIC GENERATING PLANTS AND DAMS
All the electric generating plants and stations of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, including all powerhouses, buildings, reservoirs, dams,
pipelines, flumes, structures and works and the land on which the same are
situated and all water rights and all other lands and easements, rights of way,
permits, privileges, towers, poles, wires, machinery, equipment, appliances,
appurtenances and supplies and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with such
plants and stations or any of them, or adjacent thereto.
II.
ELECTRIC TRANSMISSION LINES
All the electric transmission lines of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including towers, poles, pole lines, wires, switches, switch racks,
switchboards, insulators and other appliances and equipment, and all other
property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such transmission lines or any of them or
adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises and rights for or relating to the construction,
maintenance or operation thereof, through, over, under or upon any private
property or any public streets or highways, within as well as without the
corporate limits of any municipal corporation. Also all the real property,
rights of way, easements, permits, privileges and rights for or relating to the
construction, maintenance or operation of certain transmission lines, the land
and rights for which are owned by the Company, which are either not built or now
being constructed.
III.
ELECTRIC DISTRIBUTION SYSTEMS
All the electric distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including substations, transformers, switchboards,
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towers, poles, wires, insulators, subways, trenches, conduits, manholes, cables,
meters and other appliances and equipment, and all other property, real or
personal, forming a part of or appertaining to or used, occupied or enjoyed in
connection with such distribution systems or any of them or adjacent thereto;
together with all real property, rights of way, easements, permits, privileges,
franchises, grants and rights, for or relating to the construction, maintenance
or operation thereof, through, over, under or upon any private property or any
public streets or highways within as well as without the corporate limits of any
municipal corporation.
IV.
ELECTRIC SUBSTATIONS, SWITCHING STATIONS AND SITES
All the substations, switching stations and sites of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, for transforming, regulating, converting or distributing or
otherwise controlling electric current at any of its plants and elsewhere,
together with all buildings, transformers, wires, insulators and other
appliances and equipment, and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with any
of such substations and switching stations, or adjacent thereto, with sites to
be used for such purposes.
V.
GAS COMPRESSOR STATIONS, GAS PROCESSING PLANTS, DESULPHURIZATION
STATIONS, METERING STATIONS, ODORIZING STATIONS, REGULATORS AND
SITES
All the compressor stations, processing plants, desulphurization
stations, metering stations, odorizing stations, regulators and sites of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
lien of the Indenture, for compressing, processing, desulphurizing, metering,
odorizing and regulating manufactured or natural gas at any of its plants and
elsewhere, together with all buildings, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with any of such
purposes, with sites to be used for such purposes.
VI.
GAS STORAGE FIELDS
The natural gas rights and interests of the Company, including wells
and well lines (but not including natural gas, oil and minerals), the gas
gathering system, the underground gas storage rights, the underground gas
storage wells and injection and withdrawal system used in connection therewith,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture: In the Overisel Gas Storage Field, located in the Township of
Overisel, Allegan County, and in the Township of Zeeland, Ottawa County,
Michigan; in the Northville Gas Storage Field located
-14-
in the Township of Salem, Washtenaw County, Township of Lyon, Oakland County,
and the Townships of Northville and Plymouth and City of Plymouth, Wayne County,
Michigan; in the Salem Gas Storage Field, located in the Township of Salem,
Allegan County, and in the Township of Jamestown, Ottawa County, Michigan; in
the Ray Gas Storage Field, located in the Townships of Ray and Armada, Macomb
County, Michigan; in the Lenox Gas Storage Field, located in the Townships of
Lenox and Chesterfield, Macomb County, Michigan; in the Ira Gas Storage Field,
located in the Township of Ira, St. Clair County, Michigan; in the Puttygut Gas
Storage Field, located in the Township of Casco, St. Clair County, Michigan; in
the Four Corners Gas Storage Field, located in the Townships of Casco, China,
Cottrellville and Ira, St. Clair County, Michigan; in the Swan Creek Gas Storage
Field, located in the Township of Casco and Ira, St. Clair County, Michigan; and
in the Hessen Gas Storage Field, located in the Townships of Casco and Columbus,
St. Clair, Michigan.
VII.
GAS TRANSMISSION LINES
All the gas transmission lines of the Company, constructed or otherwise
acquired by it and not heretofore described in the Indenture or any supplement
thereto and not heretofore released from the lien of the Indenture, including
gas mains, pipes, pipelines, gates, valves, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such
transmission lines or any of them or adjacent thereto; together with all real
property, right of way, easements, permits, privileges, franchises and rights
for or relating to the construction, maintenance or operation thereof, through,
over, under or upon any private property or any public streets or highways,
within as well as without the corporate limits of any municipal corporation.
VIII.
GAS DISTRIBUTION SYSTEMS
All the gas distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including tunnels, conduits, gas mains and pipes, service pipes, fittings,
gates, valves, connections, meters and other appliances and equipment, and all
other property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such distribution systems or any of them
or adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises, grants and rights, for or relating to the
construction, maintenance or operation thereof, through, over, under or upon any
private property or any public streets or highways within as well as without the
corporate limits of any municipal corporation.
-15-
IX.
OFFICE BUILDINGS, SERVICE BUILDINGS, GARAGES, ETC.
All office, garage, service and other buildings of the Company,
wherever located, in the State of Michigan, constructed or otherwise acquired by
it and not heretofore described in the Indenture or any supplement thereto and
not heretofore released from the lien of the Indenture, together with the land
on which the same are situated and all easements, rights of way and
appurtenances to said lands, together with all furniture and fixtures located in
said buildings.
X.
TELEPHONE PROPERTIES AND
RADIO COMMUNICATION EQUIPMENT
All telephone lines, switchboards, systems and equipment of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
line of the Indenture, used or available for use in the operation of its
properties, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such telephone
properties or any of them or adjacent thereto; together with all real estate,
rights of way, easements, permits, privileges, franchises, property, devices or
rights related to the dispatch, transmission, reception or reproduction of
messages, communications, intelligence, signals, light, vision or sound by
electricity, wire or otherwise, including all telephone equipment installed in
buildings used as general and regional offices, substations and generating
stations and all telephone lines erected on towers and poles; and all radio
communication equipment of the Company, together with all property, real or
personal (except any in the Indenture expressly excepted), fixed stations,
towers, auxiliary radio buildings and equipment, and all appurtenances used in
connection therewith, wherever located, in the State of Michigan.
XI.
OTHER REAL PROPERTY
All other real property of the Company and all interests therein, of
every nature and description (except any in the Indenture expressly excepted)
wherever located, in the State of Michigan, acquired by it and not heretofore
described in the Indenture or any supplement thereto and not heretofore released
from the lien of the Indenture. Such real property includes but is not limited
to the following described property, such property is subject to any interests
that were excepted or reserved in the conveyance to the Company:
ALCONA COUNTY
Certain land in Caledonia Township, Alcona County, Michigan described
as:
The East 330 feet of the South 660 feet of the SW 1/4 of the
SW 1/4 of Section 8, T28N, R8E, except the West 264 feet of the South
330 feet thereof; said land being more particularly described as
follows: To find the place of
-16-
beginning of this description, commence at the Southwest corner of said
section, run thence East along the South line of said section 1243 feet
to the place of beginning of this description, thence continuing East
along said South line of said section 66 feet to the West 1/8 line of
said section, thence N 02 degrees 09' 30" E along the said West 1/8
line of said section 660 feet, thence West 330 feet, thence S 02
degrees 09' 30" W, 330 feet, thence East 264 feet, thence S 02 degrees
09' 30" W, 330 feet to the place of beginning.
ALLEGAN COUNTY
Certain land in Lee Township, Allegan County, Michigan described as:
The NE 1/4 of the NW 1/4 of Section 16, T1N, R15W.
ALPENA COUNTY
Certain land in Wilson and Green Townships, Alpena County, Michigan
described as:
All that part of the S'ly 1/2 of the former Boyne City-Gaylord
and Alpena Railroad right of way, being the Southerly 50 feet of a 100
foot strip of land formerly occupied by said Railroad, running from the
East line of Section 31, T31N, R7E, Southwesterly across said Section
31 and Sections 5 and 6 of T30N, R7E and Sections 10, 11 and the E 1/2
of Section 9, except the West 1646 feet thereof, all in T30N, R6E.
ANTRIM COUNTY
Certain land in Mancelona Township, Antrim County, Michigan described
as:
The S 1/2 of the NE 1/4 of Section 33, T29N, R6W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the State of Michigan to August W. Schack and Emma H. Schack, his wife,
dated April 15, 1946 and recorded May 20, 1946 in Liber 97 of Deeds on
page 682 of Antrim County Records.
ARENAC COUNTY
Certain land in Standish Township, Arenac County, Michigan described
as:
A parcel of land in the SW 1/4 of the NW 1/4 of Section 12,
T18N, R4E, described as follows: To find the place of beginning of said
parcel of land, commence at the Northwest corner of Section 12, T18N,
R4E; run thence South along the West line of said section, said West
line of said section being also the center line of East City Limits
Road 2642.15 feet to the W 1/4 post of said section and the place of
beginning of said parcel of land; running thence N 88 degrees 26' 00" E
along the East and West 1/4 line of said section, 660.0 feet; thence
North parallel with the West line of said section, 310.0 feet; thence S
88 degrees 26' 00"
-17-
W, 330.0 feet; thence South parallel with the West line of said
section, 260.0 feet; thence S 88 degrees 26' 00" W, 330.0 feet to the
West line of said section and the center line of East City Limits Road;
thence South along the said West line of said section, 50.0 feet to the
place of beginning.
BARRY COUNTY
Certain land in Johnstown Township, Barry County, Michigan described
as:
A strip of land 311 feet in width across the SW 1/4 of the NE
1/4 of Section 31, T1N, R8W, described as follows: To find the place of
beginning of this description, commence at the E 1/4 post of said
section; run thence N 00 degrees 55' 00" E along the East line of said
section, 555.84 feet; thence N 59 degrees 36' 20" W, 1375.64 feet;
thence N 88 degrees 30' 00" W, 130 feet to a point on the East 1/8 line
of said section and the place of beginning of this description; thence
continuing N 88 degrees 30' 00" W, 1327.46 feet to the North and South
1/4 line of said section; thence S 00 degrees 39'35" W along said North
and South 1/4 line of said section, 311.03 feet to a point, which said
point is 952.72 feet distant N'ly from the East and West 1/4 line of
said section as measured along said North and South 1/4 line of said
section; thence S 88 degrees 30' 00" E, 1326.76 feet to the East 1/8
line of said section; thence N 00 degrees 47' 20" E along said East 1/8
line of said section, 311.02 feet to the place of beginning.
BAY COUNTY
Certain land in Frankenlust Township, Bay County, Michigan described
as:
The South 250 feet of the N 1/2 of the W 1/2 of the W 1/2 of
the SE 1/4 of Section 9, T13N, R4E.
BENZIE COUNTY
Certain land in Benzonia Township, Benzie County, Michigan described
as:
A parcel of land in the Northeast 1/4 of Section 7, Township
26 North, Range 14 West, described as beginning at a point on the East
line of said Section 7, said point being 320 feet North measured along
the East line of said section from the East 1/4 post; running thence
West 165 feet; thence North parallel with the East line of said section
165 feet; thence East 165 feet to the East line of said section; thence
South 165 feet to the place of beginning.
BRANCH COUNTY
Certain land in Girard Township, Branch County, Michigan described as:
A parcel of land in the NE 1/4 of Section 23 T5S, R6W,
described as beginning at a point on the North and South quarter line
of said section at a point
-18-
1278.27 feet distant South of the North quarter post of said section,
said distance being measured along the North and South quarter line of
said section, running thence S89 degrees21'E 250 feet, thence North
along a line parallel with the said North and South quarter line of
said section 200 feet, thence N89 degrees21'W 250 feet to the North and
South quarter line of said section, thence South along said North and
South quarter line of said section 200 feet to the place of beginning.
CALHOUN COUNTY
Certain land in Convis Township, Calhoun County, Michigan described as:
A parcel of land in the SE 1/4 of the SE 1/4 of Section 32,
T1S, R6W, described as follows: To find the place of beginning of this
description, commence at the Southeast corner of said section; run
thence North along the East line of said section 1034.32 feet to the
place of beginning of this description; running thence N 89 degrees 39'
52" W, 333.0 feet; thence North 290.0 feet to the South 1/8 line of
said section; thence S 89 degrees 39' 52" E along said South 1/8 line
of said section 333.0 feet to the East line of said section; thence
South along said East line of said section 290.0 feet to the place of
beginning. (Bearings are based on the East line of Section 32, T1S,
R6W, from the Southeast corner of said section to the Northeast corner
of said section assumed as North.)
CASS COUNTY
Certain easement rights located across land in Marcellus Township, Cass
County, Michigan described as:
The East 6 rods of the SW 1/4 of the SE 1/4 of Section 4, T5S,
R13W.
CHARLEVOIX COUNTY
Certain land in South Arm Township, Charlevoix County, Michigan
described as:
A parcel of land in the SW 1/4 of Section 29, T32N, R7W,
described as follows: Beginning at the Southwest corner of said section
and running thence North along the West line of said section 788.25
feet to a point which is 528 feet distant South of the South 1/8 line
of said section as measured along the said West line of said section;
thence N 89 degrees 30' 19" E, parallel with said South 1/8 line of
said section 442.1 feet; thence South 788.15 feet to the South line of
said section; thence S 89 degrees 29' 30" W, along said South line of
said section 442.1 feet to the place of beginning.
-19-
CHEBOYGAN COUNTY
Certain land in Inverness Township, Cheboygan County, Michigan
described as:
A parcel of land in the SW frl 1/4 of Section 31, T37N, R2W,
described as beginning at the Northwest corner of the SW frl 1/4,
running thence East on the East and West quarter line of said Section,
40 rods, thence South parallel to the West line of said Section 40
rods, thence West 40 rods to the West line of said Section, thence
North 40 rods to the place of beginning.
CLARE COUNTY
Certain land in Frost Township, Clare County, Michigan described as:
The East 150 feet of the North 225 feet of the NW 1/4 of the
NW 1/4 of Section 15, T20N, R4W.
CLINTON COUNTY
Certain land in Watertown Township, Clinton County, Michigan described
as:
The NE 1/4 of the NE 1/4 of the SE 1/4 of Section 22, and the
North 165 feet of the NW 1/4 of the NE 1/4 of the SE 1/4 of Section 22,
T5N, R3W.
CRAWFORD COUNTY
Certain land in Lovells Township, Crawford County, Michigan described
as:
A parcel of land in Section 1, T28N, R1W, described as:
Commencing at NW corner said section; thence South 89 degrees53'30"
East along North section line 105.78 feet to point of beginning; thence
South 89 degrees53'30" East along North section line 649.64 feet;
thence South 55 degrees 42'30" East 340.24 feet; thence South 55
degrees 44' 37" East 5,061.81 feet to the East section line; thence
South 00 degrees 00' 08" West along East section line 441.59 feet;
thence North 55 degrees 44' 37" West 5,310.48 feet; thence North 55
degrees 42'30" West 877.76 feet to point of beginning.
EATON COUNTY
Certain land in Eaton Township, Eaton County, Michigan described as:
A parcel of land in the SW 1/4 of Section 6, T2N, R4W,
described as follows: To find the place of beginning of this
description commence at the Southwest corner of said section; run
thence N 89 degrees 51' 30" E along the South line of said section 400
feet to the place of beginning of this description; thence continuing N
89 degrees 51' 30" E, 500 feet; thence N 00 degrees 50' 00" W, 600
feet; thence S 89 degrees 51' 30" W parallel with the South line of
said
-20-
section 500 feet; thence S 00 degrees 50' 00" E, 600 feet to the place
of beginning.
EMMET COUNTY
Certain land in Wawatam Township, Emmet County, Michigan described as:
The West 1/2 of the Northeast 1/4 of the Northeast 1/4 of
Section 23, T39N, R4W.
GENESEE COUNTY
Certain land in Argentine Township, Genesee County, Michigan described
as:
A parcel of land of part of the SW 1/4 of Section 8, T5N, R5E,
being more particularly described as follows:
Beginning at a point of the West line of Duffield Road, 100
feet wide, (as now established) distant 829.46 feet measured N01
degrees42'56"W and 50 feet measured S88 degrees14'04"W' from the South
quarter corner, Section 8, T5N, R5E; thence S88 degrees14'04"W a
distance of 550 feet; thence N01 degrees42'56"W a distance of 500 feet
to a point on the North line of the South half of the Southwest quarter
of said Section 8; thence N88 degrees14'04"E along the North line of
South half of the Southwest quarter of said Section 8 a distance 550
feet to a point on the West line of Duffield Road, 100 feet wide (as
now established); thence S01 degrees42'56"E along the West line of said
Duffield Road a distance of 500 feet to the point of beginning.
GLADWIN COUNTY
Certain land in Secord Township, Gladwin County, Michigan described as:
The East 400 feet of the South 450 feet of Section 2, T19N,
R1E.
GRAND TRAVERSE COUNTY
Certain land in Mayfield Township, Grand Traverse County, Michigan
described as:
A parcel of land in the Northwest 1/4 of Section 3, T25N,
R11W, described as follows: Commencing at the Northwest corner of said
section, running thence S 89 degrees19'15" E along the North line of
said section and the center line of Clouss Road 225 feet, thence South
400 feet, thence N 89 degrees19'15" W 225 feet to the West line of said
section and the center line of Hannah Road, thence North along the West
line of said section and the center line of Hannah Road 400 feet to the
place of beginning for this description.
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GRATIOT COUNTY
Certain land in Fulton Township, Gratiot County, Michigan described as:
A parcel of land in the NE 1/4 of Section 7, Township 9 North,
Range 3 West, described as beginning at a point on the North line of
George Street in the Village of Middleton, which is 542 feet East of
the North and South one-quarter (1/4) line of said Section 7; thence
North 100 feet; thence East 100 feet; thence South 100 feet to the
North line of George Street; thence West along the North line of George
Street 100 feet to place of beginning.
HILLSDALE COUNTY
Certain land in Litchfield Village, Hillsdale County, Michigan
described as:
Lot 238 of Block three (3) of Assessors Plat of the Village of
Litchfield.
HURON COUNTY
Certain easement rights located across land in Sebewaing Township,
Huron County, Michigan described as:
The North 1/2 of the Northwest 1/4 of Section 15, T15N, R9E.
INGHAM COUNTY
Certain land in Vevay Township, Ingham County, Michigan described as:
A parcel of land 660 feet wide in the Southwest 1/4 of Section
7 lying South of the centerline of Sitts Road as extended to the
North-South 1/4 line of said Section 7, T2N, R1W, more particularly
described as follows: Commence at the Southwest corner of said Section
7, thence North along the West line of said Section 2502.71 feet to the
centerline of Sitts Road; thence South 89 degrees54'45" East along said
centerline 2282.38 feet to the place of beginning of this description;
thence continuing South 89 degrees54'45" East along said centerline and
said centerline extended 660.00 feet to the North-South 1/4 line of
said section; thence South 00 degrees07'20" West 1461.71 feet; thence
North 89 degrees34'58" West 660.00 feet; thence North 00 degrees07'20"
East 1457.91 feet to the centerline of Sitts Road and the place of
beginning.
IONIA COUNTY
Certain land in Sebewa Township, Ionia County, Michigan described as:
A strip of land 280 feet wide across that part of the SW 1/4
of the NE 1/4 of Section 15, T5N, R6W, described as follows:
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To find the place of beginning of this description commence at
the E 1/4 corner of said section; run thence N 00 degrees 05' 38" W
along the East line of said section, 1218.43 feet; thence S 67 degrees
18' 24" W, 1424.45 feet to the East 1/8 line of said section and the
place of beginning of this description; thence continuing S 67 degrees
18' 24" W, 1426.28 feet to the North and South 1/4 line of said section
at a point which said point is 105.82 feet distant N'ly of the center
of said section as measured along said North and South 1/4 line of said
section; thence N 00 degrees 04' 47" E along said North and South 1/4
line of said section, 303.67 feet; thence N 67 degrees 18' 24" E,
1425.78 feet to the East 1/8 line of said section; thence S 00 degrees
00' 26" E along said East 1/8 line of said section, 303.48 feet to the
place of beginning. (Bearings are based on the East line of Section 15,
T5N, R6W, from the E 1/4 corner of said section to the Northeast corner
of said section assumed as N 00 degrees 05' 38" W.)
IOSCO COUNTY
Certain land in Alabaster Township, Iosco County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 34, T21N, R7E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence
South along the North and South 1/4 line of said section, 1354.40 feet
to the place of beginning of this description; thence continuing South
along the said North and South 1/4 line of said section, 165.00 feet to
a point on the said North and South 1/4 line of said section which said
point is 1089.00 feet distant North of the center of said section;
thence West 440.00 feet; thence North 165.00 feet; thence East 440.00
feet to the said North and South 1/4 line of said section and the place
of beginning.
ISABELLA COUNTY
Certain land in Chippewa Township, Isabella County, Michigan described
as:
The North 8 rods of the NE 1/4 of the SE 1/4 of Section 29,
T14N, R3W.
JACKSON COUNTY
Certain land in Waterloo Township, Jackson County, Michigan described
as:
A parcel of land in the North fractional part of the N
fractional 1/2 of Section 2, T1S, R2E, described as follows: To find
the place of beginning of this description commence at the E 1/4 post
of said section; run thence N 01 degrees 03' 40" E along the East line
of said section 1335.45 feet to the North 1/8 line of said section and
the place of beginning of this description; thence N 89 degrees 32' 00"
W, 2677.7 feet to the North and South 1/4 line of said section; thence
S 00 degrees 59' 25" W along the North and South 1/4 line of said
section 22.38 feet to the North 1/8 line of said section; thence S 89
degrees 59' 10" W along the North 1/8 line of said section 2339.4 feet
to the center line of State Trunkline Highway M-52; thence N 53 degrees
46' 00" W along the center line of said State
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Trunkline Highway 414.22 feet to the West line of said section; thence
N 00 degrees 55' 10" E along the West line of said section 74.35 feet;
thence S 89 degrees 32' 00" E, 5356.02 feet to the East line of said
section; thence S 01 degrees 03' 40" W along the East line of said
section 250 feet to the place of beginning.
KALAMAZOO COUNTY
Certain land in Alamo Township, Kalamazoo County, Michigan described
as:
The South 350 feet of the NW 1/4 of the NW 1/4 of Section 16,
T1S, R12W, being more particularly described as follows: To find the
place of beginning of this description, commence at the Northwest
corner of said section; run thence S 00 degrees 36' 55" W along the
West line of said section 971.02 feet to the place of beginning of this
description; thence continuing S 00 degrees 36' 55" W along said West
line of said section 350.18 feet to the North 1/8 line of said section;
thence S 87 degrees 33' 40" E along the said North 1/8 line of said
section 1325.1 feet to the West 1/8 line of said section; thence N 00
degrees 38' 25" E along the said West 1/8 line of said section 350.17
feet; thence N 87 degrees 33' 40" W, 1325.25 feet to the place of
beginning.
KALKASKA COUNTY
Certain land in Kalkaska Township, Kalkaska County, Michigan described
as:
The NW 1/4 of the SW 1/4 of Section 4, T27N, R7W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the Department of Conservation for the State of Michigan to George
Welker and Mary Welker, his wife, dated October 9, 1934 and recorded
December 28, 1934 in Liber 39 on page 291 of Kalkaska County Records,
and subject to easement for pipeline purposes as granted to Michigan
Consolidated Gas Company by first party herein on April 4, 1963 and
recorded June 21, 1963 in Liber 91 on page 631 of Kalkaska County
Records.
KENT COUNTY
Certain land in Caledonia Township, Kent County, Michigan described as:
A parcel of land in the Northwest fractional 1/4 of Section
15, T5N, R10W, described as follows: To find the place of beginning of
this description commence at the North 1/4 corner of said section, run
thence S 0 degrees 59' 26" E along the North and South 1/4 line of said
section 2046.25 feet to the place of beginning of this description,
thence continuing S 0 degrees 59' 26" E along said North and South 1/4
line of said section 332.88 feet, thence S 88 degrees 58' 30" W 2510.90
feet to a point herein designated "Point A" on the East bank of the
Thornapple River, thence continuing S 88 degrees 53' 30" W to the
center thread of the Thornapple River, thence NW'ly along the center
thread of said Thornapple
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River to a point which said point is S 88 degrees 58' 30" W of a point
on the East bank of the Thornapple River herein designated "Point B",
said "Point B" being N 23 degrees 41' 35" W 360.75 feet from said
above-described "Point A", thence N 88 degrees 58' 30" E to said "Point
B", thence continuing N 88 degrees 58' 30" E 2650.13 feet to the place
of beginning. (Bearings are based on the East line of Section 15, T5N,
R10W between the East 1/4 corner of said section and the Northeast
corner of said section assumed as N 0 degrees 59' 55" W.)
LAKE COUNTY
Certain land in Pinora and Cherry Valley Townships, Lake County,
Michigan described as:
A strip of land 50 feet wide East and West along and adjoining
the West line of highway on the East side of the North 1/2 of Section
13 T18N, R12W. Also a strip of land 100 feet wide East and West along
and adjoining the East line of the highway on the West side of
following described land: The South 1/2 of NW 1/4, and the South 1/2 of
the NW 1/4 of the SW 1/4, all in Section 6, T18N, R11W.
LAPEER COUNTY
Certain land in Hadley Township, Lapeer County, Michigan described as:
The South 825 feet of the W 1/2 of the SW 1/4 of Section 24,
T6N, R9E, except the West 1064 feet thereof.
LEELANAU COUNTY
Certain land in Cleveland Township, Leelanau County, Michigan described
as:
The North 200 feet of the West 180 feet of the SW 1/4 of the
SE 1/4 of Section 35, T29N, R13W.
LENAWEE COUNTY
Certain land in Madison Township, Lenawee County, Michigan described
as:
A strip of land 165 feet wide off the West side of the
following described premises: The E 1/2 of the SE 1/4 of Section 12.
The E 1/2 of the NE 1/4 and the NE 1/4 of the SE 1/4 of Section 13,
being all in T7S, R3E, excepting therefrom a parcel of land in the E
1/2 of the SE 1/4 of Section 12, T7S, R3E, beginning at the Northwest
corner of said E 1/2 of the SE 1/4 of Section 12, running thence East 4
rods, thence South 6 rods, thence West 4 rods, thence North 6 rods to
the place of beginning.
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LIVINGSTON COUNTY
Certain land in Cohoctah Township, Livingston County, Michigan
described as:
Parcel 1
The East 390 feet of the East 50 rods of the SW 1/4 of Section
30, T4N, R4E.
Parcel 2
A parcel of land in the NW 1/4 of Section 31, T4N, R4E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence N 89
degrees 13' 06" W along the North line of said section, 330 feet to the
place of beginning of this description; running thence S 00 degrees 52'
49" W, 2167.87 feet; thence N 88 degrees 59' 49" W, 60 feet; thence N
00 degrees 52' 49" E, 2167.66 feet to the North line of said section;
thence S 89 degrees 13' 06" E along said North line of said section, 60
feet to the place of beginning.
MACOMB COUNTY
Certain land in Macomb Township, Macomb County, Michigan described as:
A parcel of land commencing on the West line of the E 1/2 of
the NW 1/4 of fractional Section 6, 20 chains South of the NW corner of
said E 1/2 of the NW 1/4 of Section 6; thence South on said West line
and the East line of A. Henry Kotner's Hayes Road Subdivision #15,
according to the recorded plat thereof, as recorded in Liber 24 of
Plats, on page 7, 24.36 chains to the East and West 1/4 line of said
Section 6; thence East on said East and West 1/4 line 8.93 chains;
thence North parallel with the said West line of the E 1/2 of the NW
1/4 of Section 6, 24.36 chains; thence West 8.93 chains to the place of
beginning, all in T3N, R13E.
MANISTEE COUNTY
Certain land in Manistee Township, Manistee County, Michigan described
as:
A parcel of land in the SW 1/4 of Section 20, T22N, R16W,
described as follows: To find the place of beginning of this
description, commence at the Southwest corner of said section; run
thence East along the South line of said section 832.2 feet to the
place of beginning of this description; thence continuing East along
said South line of said section 132 feet; thence North 198 feet; thence
West 132 feet; thence South 198 feet to the place of beginning,
excepting therefrom the South 2 rods thereof which was conveyed to
Manistee Township for highway purposes by a Quitclaim Deed dated June
13, 1919 and recorded July 11, 1919 in Liber 88 of Deeds on page 638 of
Manistee County Records.
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MASON COUNTY
Certain land in Riverton Township, Mason County, Michigan described as:
Parcel 1
The South 10 acres of the West 20 acres of the S 1/2 of the NE
1/4 of Section 22, T17N, R17W.
Parcel 2
A parcel of land containing 4 acres of the West side of
highway, said parcel of land being described as commencing 16 rods
South of the Northwest corner of the NW 1/4 of the SW 1/4 of Section
22, T17N, R17W, running thence South 64 rods, thence NE'ly and N'ly and
NW'ly along the W'ly line of said highway to the place of beginning,
together with any and all right, title, and interest of Howard C.
Wicklund and Katherine E. Wicklund in and to that portion of the
hereinbefore mentioned highway lying adjacent to the E'ly line of said
above described land.
MECOSTA COUNTY
Certain land in Wheatland Township, Mecosta County, Michigan described
as:
A parcel of land in the SW 1/4 of the SW 1/4 of Section 16,
T14N, R7W, described as beginning at the Southwest corner of said
section; thence East along the South line of Section 133 feet; thence
North parallel to the West section line 133 feet; thence West 133 feet
to the West line of said Section; thence South 133 feet to the place of
beginning.
MIDLAND COUNTY
Certain land in Ingersoll Township, Midland County, Michigan described
as:
The West 200 feet of the W 1/2 of the NE 1/4 of Section 4,
T13N, R2E.
MISSAUKEE COUNTY
Certain land in Norwich Township, Missaukee County, Michigan described
as:
A parcel of land in the NW 1/4 of the NW 1/4 of Section 16,
T24N, R6W, described as follows: Commencing at the Northwest corner of
said section, running thence N 89 degrees 01' 45" E along the North
line of said section 233.00 feet; thence South 233.00 feet; thence S 89
degrees 01' 45" W, 233.00 feet to the West line of said section; thence
North along said West line of said section 233.00 feet to the place of
beginning. (Bearings are based on the West line of Section 16, T24N,
R6W, between the Southwest and Northwest corners of said section
assumed as North.)
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MONROE COUNTY
Certain land in Whiteford Township, Monroe County, Michigan described
as:
A parcel of land in the SW1/4 of Section 20, T8S, R6E,
described as follows: To find the place of beginning of this
description commence at the S 1/4 post of said section; run thence West
along the South line of said section 1269.89 feet to the place of
beginning of this description; thence continuing West along said South
line of said section 100 feet; thence N 00 degrees 50' 35" E, 250 feet;
thence East 100 feet; thence S 00 degrees 50' 35" W parallel with and
16.5 feet distant W'ly of as measured perpendicular to the West 1/8
line of said section, as occupied, a distance of 250 feet to the place
of beginning.
MONTCALM COUNTY
Certain land in Crystal Township, Montcalm County, Michigan described
as:
The N 1/2 of the S 1/2 of the SE 1/4 of Section 35, T10N, R5W.
MONTMORENCY COUNTY
Certain land in the Village of Hillman, Montmorency County, Michigan
described as:
Lot 14 of Hillman Industrial Park, being a subdivision in the
South 1/2 of the Northwest 1/4 of Section 24, T31N, R4E, according to
the plat thereof recorded in Liber 4 of Plats on Pages 32-34,
Montmorency County Records.
MUSKEGON COUNTY
Certain land in Casnovia Township, Muskegon County, Michigan described
as:
The West 433 feet of the North 180 feet of the South 425 feet
of the SW 1/4 of Section 3, T10N, R13W.
NEWAYGO COUNTY
Certain land in Ashland Township, Newaygo County, Michigan described
as:
The West 250 feet of the NE 1/4 of Section 23, T11N, R13W.
OAKLAND COUNTY
Certain land in Wixcom City, Oakland County, Michigan described as:
The E 75 feet of the N 160 feet of the N 330 feet of the W
526.84 feet of the NW 1/4 of the NW 1/4 of Section 8, T1N, R8E, more
particularly described as follows: Commence at the NW corner of said
Section 8, thence N 87 degrees 14' 29" E along the North line of said
Section 8 a distance of 451.84 feet to the place
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of beginning for this description; thence continuing N 87 degrees 14'
29" E along said North section line a distance of 75.0 feet to the East
line of the West 526.84 feet of the NW 1/4 of the NW 1/4 of said
Section 8; thence S 02 degrees 37' 09" E along said East line a
distance of 160.0 feet; thence S 87 degrees 14' 29" W a distance of
75.0 feet; thence N 02 degrees 37' 09" W a distance of 160.0 feet to
the place of beginning.
OCEANA COUNTY
Certain land in Crystal Township, Oceana County, Michigan described as:
The East 290 feet of the SE 1/4 of the NW 1/4 and the East 290
feet of the NE 1/4 of the SW 1/4, all in Section 20, T16N, R16W.
OGEMAW COUNTY
Certain land in West Branch Township, Ogemaw County, Michigan described
as:
The South 660 feet of the East 660 feet of the NE 1/4 of the
NE 1/4 of Section 33, T22N, R2E.
OSCEOLA COUNTY
Certain land in Hersey Township, Osceola County, Michigan described as:
A parcel of land in the North 1/2 of the Northeast 1/4 of
Section 13, T17N, R9W, described as commencing at the Northeast corner
of said Section; thence West along the North Section line 999 feet to
the point of beginning of this description; thence S 01 degrees 54' 20"
E 1327.12 feet to the North 1/8 line; thence S 89 degrees 17' 05" W
along the North 1/8 line 330.89 feet; thence N 01 degrees 54' 20" W
1331.26 feet to the North Section line; thence East along the North
Section line 331 feet to the point of beginning.
OSCODA COUNTY
Certain land in Comins Township, Oscoda County, Michigan described as:
The East 400 feet of the South 580 feet of the W 1/2 of the SW
1/4 of Section 15, T27N, R3E.
OTSEGO COUNTY
Certain land in Corwith Township, Otsego County, Michigan described as:
Part of the NW 1/4 of the NE 1/4 of Section 28, T32N, R3W,
described as: Beginning at the N 1/4 corner of said section; running
thence S 89 degrees 04' 06" E along the North line of said section,
330.00 feet; thence S 00 degrees 28' 43" E, 400.00 feet; thence N 89
degrees 04' 06" W, 330.00 feet to the North and
-29-
South 1/4 line of said section; thence N 00 degrees 28' 43" W along the
said North and South 1/4 line of said section, 400.00 feet to the point
of beginning; subject to the use of the N'ly 33.00 feet thereof for
highway purposes.
OTTAWA COUNTY
Certain land in Robinson Township, Ottawa County, Michigan described
as:
The North 660 feet of the West 660 feet of the NE 1/4 of the
NW 1/4 of Section 26, T7N, R15W.
PRESQUE ISLE COUNTY
Certain land in Belknap and Pulawski Townships, Presque Isle County,
Michigan described as:
Part of the South half of the Northeast quarter, Section 24,
T34N, R5E, and part of the Northwest quarter, Section 19, T34N, R6E,
more fully described as: Commencing at the East 1/4 corner of said
Section 24; thence N 00 degrees15'47" E, 507.42 feet, along the East
line of said Section 24 to the point of beginning; thence S 88
degrees15'36" W, 400.00 feet, parallel with the North 1/8 line of said
Section 24; thence N 00 degrees15'47" E, 800.00 feet, parallel with
said East line of Section 24; thence N 88 degrees15'36"E, 800.00 feet,
along said North 1/8 line of Section 24 and said line extended; thence
S 00 degrees15'47" W, 800.00 feet, parallel with said East line of
Section 24; thence S 88 degrees15'36" W, 400.00 feet, parallel with
said North 1/8 line of Section 24 to the point of beginning.
Together with a 33 foot easement along the West 33 feet of the
Northwest quarter lying North of the North 1/8 line of Section 24,
Belknap Township, extended, in Section 19, T34N, R6E.
ROSCOMMON COUNTY
Certain land in Gerrish Township, Roscommon County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 19, T24N, R3W,
described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section, run
thence East along the North line of said section 1,163.2 feet to the
place of beginning of this description (said point also being the place
of intersection of the West 1/8 line of said section with the North
line of said section), thence S 01 degrees 01' E along said West 1/8
line 132 feet, thence West parallel with the North line of said section
132 feet, thence N 01 degrees 01' W parallel with said West 1/8 line of
said section 132 feet to the North line of said section, thence East
along the North line of said section 132 feet to the place of
beginning.
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SAGINAW COUNTY
Certain land in Chapin Township, Saginaw County, Michigan described as:
A parcel of land in the SW 1/4 of Section 13, T9N, R1E,
described as follows: To find the place of beginning of this
description commence at the Southwest corner of said section; run
thence North along the West line of said section 1581.4 feet to the
place of beginning of this description; thence continuing North along
said West line of said section 230 feet to the center line of a creek;
thence S 70 degrees 07' 00" E along said center line of said creek
196.78 feet; thence South 163.13 feet; thence West 185 feet to the West
line of said section and the place of beginning.
SANILAC COUNTY
Certain easement rights located across land in Minden Township, Sanilac
County, Michigan described as:
The Southeast 1/4 of the Southeast 1/4 of Section 1, T14N,
R14E, excepting therefrom the South 83 feet of the East 83 feet
thereof.
SHIAWASSEE COUNTY
Certain land in Burns Township, Shiawassee County, Michigan described
as:
The South 330 feet of the E 1/2 of the NE 1/4 of Section 36,
T5N, R4E.
ST. CLAIR COUNTY
Certain land in Ira Township, St. Clair County, Michigan described as:
The N 1/2 of the NW 1/4 of the NE 1/4 of Section 6, T3N, R15E.
ST. JOSEPH COUNTY
Certain land in Mendon Township, St. Joseph County, Michigan described
as:
The North 660 feet of the West 660 feet of the NW 1/4 of SW
1/4, Section 35, T5S, R10W.
TUSCOLA COUNTY
Certain land in Millington Township, Tuscola County, Michigan described
as:
A strip of land 280 feet wide across the East 96 rods of the
South 20 rods of the N 1/2 of the SE 1/4 of Section 34, T10N, R8E, more
particularly described as commencing at the Northeast corner of Section
3, T9N, R8E, thence S 89 degrees 55' 35" W along the South line of said
Section 34 a distance of 329.65 feet, thence N 18 degrees 11' 50" W a
distance of 1398.67 feet to the South 1/8
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line of said Section 34 and the place of beginning for this
description; thence continuing N 18 degrees 11' 50" W a distance of
349.91 feet; thence N 89 degrees 57' 01" W a distance of 294.80 feet;
thence S 18 degrees 11' 50" E a distance of 350.04 feet to the South
1/8 line of said Section 34; thence S 89 degrees 58' 29" E along the
South 1/8 line of said section a distance of 294.76 feet to the place
of beginning.
VAN BUREN COUNTY
Certain land in Covert Township, Van Buren County, Michigan described
as:
All that part of the West 20 acres of the N 1/2 of the NE
fractional 1/4 of Section 1, T2S, R17W, except the West 17 rods of the
North 80 rods, being more particularly described as follows: To find
the place of beginning of this description commence at the N 1/4 post
of said section; run thence N 89 degrees 29' 20" E along the North line
of said section 280.5 feet to the place of beginning of this
description; thence continuing N 89 degrees 29' 20" E along said North
line of said section 288.29 feet; thence S 00 degrees 44' 00" E,
1531.92 feet; thence S 89 degrees 33' 30" W, 568.79 feet to the North
and South 1/4 line of said section; thence N 00 degrees 44' 00" W along
said North and South 1/4 line of said section 211.4 feet; thence N 89
degrees 29' 20" E, 280.5 feet; thence N 00 degrees 44' 00" W, 1320 feet
to the North line of said section and the place of beginning.
WASHTENAW COUNTY
Certain land in Manchester Township, Washtenaw County, Michigan
described as:
A parcel of land in the NE 1/4 of the NW 1/4 of Section 1,
T4S, R3E, described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section; run
thence East along the North line of said section 1355.07 feet to the
West 1/8 line of said section; thence S 00 degrees 22' 20" E along said
West 1/8 line of said section 927.66 feet to the place of beginning of
this description; thence continuing S 00 degrees 22' 20" E along said
West 1/8 line of said section 660 feet to the North 1/8 line of said
section; thence N 86 degrees 36' 57" E along said North 1/8 line of
said section 660.91 feet; thence N 00 degrees22' 20" W, 660 feet;
thence S 86 degrees 36' 57" W, 660.91 feet to the place of beginning.
WAYNE COUNTY
Certain land in Livonia City, Wayne County, Michigan described as:
Commencing at the Southeast corner of Section 6, T1S, R9E;
thence North along the East line of Section 6 a distance of 253 feet to
the point of beginning; thence continuing North along the East line of
Section 6 a distance of 50 feet; thence Westerly parallel to the South
line of Section 6, a distance of 215 feet; thence Southerly parallel to
the East line of Section 6 a distance of 50 feet;
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thence easterly parallel with the South line of Section 6 a distance of
215 feet to the point of beginning.
WEXFORD COUNTY
Certain land in Selma Township, Wexford County, Michigan described as:
A parcel of land in the NW 1/4 of Section 7, T22N, R10W,
described as beginning on the North line of said section at a point 200
feet East of the West line of said section, running thence East along
said North section line 450 feet, thence South parallel with said West
section line 350 feet, thence West parallel with said North section
line 450 feet, thence North parallel with said West section line 350
feet to the place of beginning.
SECTION 12. The Company is a transmitting utility under Section 9401(5)
of the Michigan Uniform Commercial Code (M.C.L. 440.9401(5)) as defined in
M.C.L. 440.9105(n).
IN WITNESS WHEREOF, said Consumers Energy Company has caused this
Supplemental Indenture to be executed in its corporate name by its Chairman of
the Board, President, a Vice President or its Treasurer and its corporate seal
to be hereunto affixed and to be attested by its Secretary or an Assistant
Secretary, and said JPMorgan Chase Bank, as Trustee as aforesaid, to evidence
its acceptance hereof, has caused this Supplemental Indenture to be executed in
its corporate name by a Vice President and its corporate seal to be hereunto
affixed and to be attested by a Trust Officer, in several counterparts, all as
of the day and year first above written.
-33-
JPMORGAN CHASE BANK, AS TRUSTEE
(SEAL) By ---------------------------
L. O'Brien
Vice President
Attest:
- ----------------------
VIRGINIA DOMINGUEZ
Trust Officer
Signed, sealed and delivered
by JPMORGAN CHASE BANK
in the presence of
- ----------------------
Natalia Rodriguez
Assistant Vice President
- ---------------------
Wanda Eiland
Assistant Vice President
STATE OF NEW YORK )
ss.
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me this day of
October, 2002, by L. O'Brien a Vice President of JPMORGAN CHASE BANK, a New York
corporation, on behalf of the corporation.
--------------------------------------------
Notary Public
[Seal] New York County, New York
My Commission Expires:
Emily Fayan
Notary Public, State of New York
No. 24-47305
Qualified in Kings County
Certificate Filed in New York Country
Commission Expires December 31, 2005
Prepared by: When recorded, return to:
Kimberly C. Wilson Consumers Energy Company
212 West Michigan Avenue General Services Real Estate Department
Jackson, MI 49201 Attn: Nancy P. Fisher, P-21-411
1945 W. Parnall Road
Jackson, MI 49201
S-2
[FORM OF REGISTERED BOND OF THE 2003 COLLATERAL SERIES BONDS]
[FACE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND
COLLATERAL SERIES DUE 2003
No. 1 $70,000,000
CONSUMERS ENERGY COMPANY, a Michigan corporation (hereinafter called
the "Company"), for value received, hereby promises to pay to Bank One, NA, as
agent (in such capacity, the "Agent") for the Banks under and as defined in the
Term Loan Agreement dated as of October 17, 2002 among the Company, the Banks
and the Agent (as amended or otherwise modified from time to time, the "Term
Loan Agreement"), or registered assigns, the principal sum of Seventy Million
Dollars ($70,000,000) or such lesser principal amount as shall be equal to the
aggregate principal amount of the Term Loans (as defined in the Term Loan
Agreement) included in the Obligations (as defined in the Term Loan Agreement)
outstanding on April 15, 2003 (the "Maturity Date"), but not in excess, however,
of the principal amount of this bond, and to pay interest thereon at the
Interest Rate (as defined below) until the principal hereof is paid or duly made
available for payment on the Maturity Date, or, in the event of redemption of
this bond, until the redemption date, or, in the event of default in the payment
of the principal hereof, until the Company's obligations with respect to the
payment of such principal shall be discharged as provided in the Indenture (as
defined on the reverse hereof). Interest on this bond shall be payable on each
Interest Payment Date (as defined below), commencing on the first Interest
Payment Date next succeeding October 17, 2002. If the Maturity Date falls on a
day which is not a Business Day, as defined below, principal and any interest
and/or fees payable with respect to the Maturity Date will be paid on the
immediately preceding Business Day. The interest payable, and punctually paid or
duly provided for, on any Interest Payment Date will, subject to certain
exceptions, be paid to the person in whose name this bond (or one or more
predecessor bonds) is registered at the close of business on the Record Date (as
defined below); provided, however, that interest payable on the Maturity Date
will be payable to the person to whom the principal hereof shall be payable.
Should the Company default in the payment of interest ("Defaulted Interest"),
the Defaulted Interest shall be paid to the person in whose name this bond (or
one or more predecessor bonds) is registered on a subsequent record date fixed
by the Company, which subsequent record date shall be fifteen (15) days prior to
the payment of such Defaulted Interest. As used herein, (A) "Business Day" shall
mean any day, other than a Saturday or Sunday, on which banks generally are open
in Chicago, Illinois and New York, New York for the conduct of substantially all
of their commercial lending activities and on which interbank wire transfers can
be made on the Fedwire system; (B) "Interest Payment Date" shall mean each date
on which interest and/or fees under the Term Loan Agreement are due and payable
from time to time pursuant to the Term Loan Agreement; (C) "Interest Rate" shall
mean a rate of interest per annum, adjusted as necessary, to result in an
interest payment equal to the aggregate amount of interest and fees due under
the Term Loan Agreement on the applicable
-48-
Interest Payment Date; and (D) "Record Date" with respect to any Interest
Payment Date shall mean the day (whether or not a Business Day) immediately next
preceding such Interest Payment Date.
Payment of the principal of and interest on this bond will be made in
immediately available funds at the office or agency of the Company maintained
for that purpose in the City of Jackson, Michigan, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.
The provisions of this bond are continued on the reverse hereof and
such continued provisions shall for all purposes have the same effect as though
fully set forth at this place.
This bond shall not be valid or become obligatory for any purpose
unless and until it shall have been authenticated by the execution by the
Trustee or its successor in trust under the Indenture of the certificate hereon.
IN WITNESS WHEREOF, Consumers Energy Company has caused this bond to be
executed in its name by its Chairman of the Board, its President or one of its
Vice Presidents by his or her signature or a facsimile thereof, and its
corporate seal or a facsimile thereof to be affixed hereto or imprinted hereon
and attested by its Secretary or one of its Assistant Secretaries by his or her
signature or a facsimile thereof.
CONSUMERS ENERGY COMPANY
Dated:
By
-------------------------------
Printed
--------------------------
Title
----------------------------
Attest:
------------------------
-49-
TRUSTEE'S AUTHENTICATION CERTIFICATE
This is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.
JPMORGAN CHASE BANK, Trustee
By
----------------------------
Authorized Officer
-50-
[REVERSE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND COLLATERAL SERIES DUE 2003
This bond is one of the bonds of a series designated as First Mortgage
Bonds, Collateral Series due 2003 (sometimes herein referred to as the "2003
Collateral Series Bonds") issued under and in accordance with and secured by an
Indenture dated as of September 1, 1945, given by the Company (or its
predecessor, Consumers Power Company, a Maine corporation) to City Bank Farmers
Trust Company (JPMorgan Chase Bank, successor) (hereinafter sometimes referred
to as the "Trustee"), together with indentures supplemental thereto, heretofore
or hereafter executed, to which indenture and indentures supplemental thereto
(hereinafter referred to collectively as the "Indenture") reference is hereby
made for a description of the property mortgaged and pledged, the nature and
extent of the security and the rights, duties and immunities thereunder of the
Trustee and the rights of the holders of said bonds and of the Trustee and of
the Company in respect of such security, and the limitations on such rights. By
the terms of the Indenture, the bonds to be secured thereby are issuable in
series which may vary as to date, amount, date of maturity, rate of interest and
in other respects as provided in the Indenture.
The 2003 Collateral Series Bonds are to be issued and delivered to the
Agent in order to evidence and secure the obligation of the Company under the
Term Loan Agreement to make payments to the Banks under the Term Loan Agreement
and to provide the Banks the benefit of the lien of the Indenture with respect
to the 2003 Collateral Series Bonds.
The obligation of the Company to make payments with respect to the
principal of 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with respect to the principal of the 2003
Collateral Series Bonds shall be deemed discharged in the same amount as the
payment with respect to the Term Loans discharges the outstanding obligation
with respect to such Term Loans.
The obligation of the Company to make payments with respect to the
interest on 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2003 Collateral Series
-51-
Bonds shall be deemed discharged in the same amount as the payment with respect
to the Term Loans discharges the outstanding obligation with respect to such
Term Loans.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on this bond, so far as such payments at the time have become due, has
been fully satisfied and discharged unless and until the Trustee shall have
received a written notice from the Agent stating (i) that timely payment of
principal and interest on the 2003 Collateral Series Bonds has not been made,
(ii) that the Company is in arrears as to the payments required to be made by it
to the Agent in connection with the Obligations pursuant to the Term Loan
Agreement, and (iii) the amount of the arrearage.
If an Event of Default (as defined in the Term Loan Agreement) with
respect to the payment of the principal of any Term Loans shall have occurred,
it shall be deemed to be a default for purposes of Section 11.01 of the
Indenture in the payment of the principal of the 2003 Collateral Series Bonds
equal to the amount of such unpaid principal (but in no event in excess of the
principal amount of the 2003 Collateral Series Bonds). If an Event of Default
(as defined in the Term Loan Agreement) with respect to the payment of interest
on any Term Loans or fees shall have occurred, it shall be deemed to be a
default for purposes of Section 11.01 of the Indenture in the payment of the
interest on the 2003 Collateral Series Bonds equal to the amount of such unpaid
interest or fees.
This bond is not redeemable except upon written demand of the Agent
following the occurrence of an Event of Default under the Term Loan Agreement
and the acceleration of the Obligations, as provided in Section 9.2 of the Term
Loan Agreement. This bond is not redeemable by the operation of the improvement
fund or the maintenance and replacement provisions of the Indenture or with the
proceeds of released property.
In case of certain defaults as specified in the Indenture, the
principal of this bond may be declared or may become due and payable on the
conditions, at the time, in the manner and with the effect provided in the
Indenture. The holders of certain specified percentages of the bonds at the time
outstanding, including in certain cases specified percentages of bonds of
particular series, may in certain cases, to the extent and as provided in the
Indenture, waive certain defaults thereunder and the consequences of such
defaults.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than seventy-five per
centum in principal amount of the bonds (exclusive of bonds disqualified by
reason of the Company's interest therein) at the time outstanding, including, if
more than one series of bonds shall be at the time outstanding, not less than
sixty per centum in principal amount of each series affected, to effect, by an
indenture supplemental to the Indenture, modifications or alterations of the
Indenture and of the rights and obligations of the Company and the rights of the
holders of the bonds and coupons; provided, however, that no such modification
or alteration shall be made without the written approval or consent of the
holder hereof which will (a) extend the maturity of this bond or reduce the rate
or extend the time of payment of interest hereon or reduce the amount of the
principal hereof, or (b) permit the creation of any lien, not otherwise
permitted, prior to or on a parity with the lien of the
-52-
Indenture, or (c) reduce the percentage of the principal amount of the bonds the
holders of which are required to approve any such supplemental indenture.
The Company reserves the right, without any consent, vote or other
action by holders of the 2003 Collateral Series Bonds or any other series
created after the Sixty-eighth Supplemental Indenture, to amend the Indenture to
reduce the percentage of the principal amount of bonds the holders of which are
required to approve any supplemental indenture (other than any supplemental
indenture which is subject to the proviso contained in the immediately preceding
sentence) (a) from not less than seventy-five per centum (including sixty per
centum of each series affected) to not less than a majority in principal amount
of the bonds at the time outstanding or (b) in case fewer than all series are
affected, not less than a majority in principal amount of the bonds of all
affected series, voting together.
No recourse shall be had for the payment of the principal of or
interest on this bond, or for any claim based hereon, or otherwise in respect
hereof or of the Indenture, to or against any incorporator, stockholder,
director or officer, past, present or future, as such, of the Company, or of any
predecessor or successor company, either directly or through the Company, or
such predecessor or successor company, or otherwise, under any constitution or
statute or rule of law, or by the enforcement of any assessment or penalty, or
otherwise, all such liability of incorporators, stockholders, directors and
officers, as such, being waived and released by the holder and owner hereof by
the acceptance of this bond and being likewise waived and released by the terms
of the Indenture.
This bond shall be exchangeable for other registered bonds of the same
series, in the manner and upon the conditions prescribed in the Indenture, upon
the surrender of such bonds at the Investor Services Department of the Company,
as transfer agent. However, notwithstanding the provisions of Section 2.05 of
the Indenture, no charge shall be made upon any registration of transfer or
exchange of bonds of said series other than for any tax or taxes or other
governmental charge required to be paid by the Company.
The Agent shall surrender this bond to the Trustee when all of the
principal of and interest on the Term Loans arising under the Term Loan
Agreement, and all of the fees payable pursuant to the Term Loan Agreement,
shall have been duly paid, and the Term Loan Agreement shall have been
terminated.
[END OF FORM OF REGISTERED BOND OF THE 2003 COLLATERAL SERIES BONDS]
----------------
-53-
AND WHEREAS all acts and things necessary to make the 2003 Collateral
Series Bonds, when duly executed by the Company and authenticated by the Trustee
or its agent and issued as prescribed in the Indenture, as heretofore
supplemented and amended, and this Supplemental Indenture provided, the valid,
binding and legal obligations of the Company, and to constitute the Indenture,
as supplemented and amended as aforesaid, as well as by this Supplemental
Indenture, a valid, binding and legal instrument for the security thereof, have
been done and performed, and the creation, execution and delivery of this
Supplemental Indenture and the creation, execution and issuance of bonds subject
to the terms hereof and of the Indenture, as so supplemented and amended, have
in all respects been duly authorized;
NOW, THEREFORE, in consideration of the premises, of the acceptance and
purchase by the holders thereof of the bonds issued and to be issued under the
Indenture, as supplemented and amended as above set forth, and of the sum of One
Dollar duly paid by the Trustee to the Company, and of other good and valuable
considerations, the receipt whereof is hereby acknowledged, and for the purpose
of securing the due and punctual payment of the principal of and premium, if
any, and interest on all bonds now outstanding under the Indenture and the
$70,000,000 principal amount of the 2003 Collateral Series Bonds proposed to be
issued initially and all other bonds which shall be issued under the Indenture,
as supplemented and amended from time to time, and for the purpose of securing
the faithful performance and observance of all covenants and conditions therein,
and in any indenture supplemental thereto, set forth, the Company has given,
granted, bargained, sold, released, transferred, assigned, hypothecated,
pledged, mortgaged, confirmed, set over, warranted, alienated and conveyed and
by these presents does give, grant, bargain, sell, release, transfer, assign,
hypothecate, pledge, mortgage, confirm, set over, warrant, alien and convey unto
JPMorgan Chase Bank, as Trustee, as provided in the Indenture, and its successor
or successors in the trust thereby and hereby created and to its or their
assigns forever, all the right, title and interest of the Company in and to all
the property, described in Section 11 hereof, together (subject to the
provisions of Article X of the Indenture) with the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, excepting, however, the
property, interests and rights specifically excepted from the lien of the
Indenture as set forth in the Indenture;
TOGETHER WITH all and singular the tenements, hereditaments and
appurtenances belonging or in any wise appertaining to the premises, property,
franchises and rights, or any thereof, referred to in the foregoing granting
clause, with the reversion and reversions, remainder and remainders and (subject
to the provisions of Article X of the Indenture) the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, and all the estate,
right, title and interest and claim whatsoever, at law as well as in equity,
which the Company now has or may hereafter acquire in and to the aforesaid
premises, property, franchises and rights and every part and parcel thereof;
SUBJECT, HOWEVER, with respect to such premises, property, franchises
and rights, to excepted encumbrances as said term is defined in Section 1.02 of
the Indenture, and subject also to all defects and limitations of title and to
all encumbrances existing at the time of acquisition. TO HAVE AND TO HOLD all
said premises, property, franchises and rights hereby conveyed, assigned,
pledged or mortgaged, or intended so to be, unto the Trustee, its successor or
successors in trust and their assigns forever;
-54-
BUT IN TRUST, NEVERTHELESS, with power of sale for the equal and
proportionate benefit and security of the holders of all bonds now or hereafter
authenticated and delivered under and secured by the Indenture and interest
coupons appurtenant thereto, pursuant to the provisions of the Indenture and of
any supplemental indenture, and for the enforcement of the payment of said bonds
and coupons when payable and the performance of and compliance with the
covenants and conditions of the Indenture and of any supplemental indenture,
without any preference, distinction or priority as to lien or otherwise of any
bond or bonds over others by reason of the difference in time of the actual
authentication, delivery, issue, sale or negotiation thereof or for any other
reason whatsoever, except as otherwise expressly provided in the Indenture; and
so that each and every bond now or hereafter authenticated and delivered
thereunder shall have the same lien, and so that the principal of and premium,
if any, and interest on every such bond shall, subject to the terms thereof, be
equally and proportionately secured, as if it had been made, executed,
authenticated, delivered, sold and negotiated simultaneously with the execution
and delivery thereof;
AND IT IS EXPRESSLY DECLARED by the Company that all bonds
authenticated and delivered under and secured by the Indenture, as supplemented
and amended as above set forth, are to be issued, authenticated and delivered,
and all said premises, property, franchises and rights hereby and by the
Indenture and indentures supplemental thereto conveyed, assigned, pledged or
mortgaged, or intended so to be, are to be dealt with and disposed of under,
upon and subject to the terms, conditions, stipulations, covenants, agreements,
trusts, uses and purposes expressed in the Indenture, as supplemented and
amended as above set forth, and the parties hereto mutually agree as follows:
SECTION 1. There is hereby created one series of bonds (the "2003
Collateral Series Bonds") designated as hereinabove provided, which shall also
bear the descriptive title "First Mortgage Bond", and the form thereof shall be
substantially as hereinbefore set forth (the "Sample Bond"). The 2003 Collateral
Series Bonds shall be issued in the aggregate principal amount of $70,000,000,
shall mature on April 15, 2003 and shall be issued only as registered bonds
without coupons in denominations of $1,000 and any multiple thereof. The serial
numbers of the 2003 Collateral Series Bonds shall be such as may be approved by
any officer of the Company, the execution thereof by any such officer either
manually or by facsimile signature to be conclusive evidence of such approval.
The 2003 Collateral Series Bonds are to be issued to and registered in the name
of the Agent under the Term Loan Agreement (as such terms are defined in the
Sample Bond) to evidence and secure any and all Obligations (as such term is
defined in the Term Loan Agreement) of the Company under the Term Loan
Agreement.
The 2003 Collateral Series Bonds shall bear interest as set forth in
the Sample Bond. The principal of and the interest on said bonds shall be
payable as set forth in the Sample Bond.
The obligation of the Company to make payments with respect to the
principal of 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with respect to the principal of the 2003
Collateral Series Bonds shall be deemed discharged in the
-55-
same amount as the payment with respect to the Term Loans discharges the
outstanding obligation with respect to such Term Loans.
The obligation of the Company to make payments with respect to the
interest on 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2003 Collateral Series Bonds shall be deemed discharged in the
same amount as the payment with respect to the Term Loans discharges the
outstanding obligation with respect to such Term Loans.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on the 2003 Collateral Series Bonds, so far as such payments at the
time have become due, has been fully satisfied and discharged unless and until
the Trustee shall have received a written notice from the Agent stating (i) that
timely payment of principal and interest on the 2003 Collateral Series Bonds has
not been made, (ii) that the Company is in arrears as to the payments required
to be made by it to the Agent pursuant to the Term Loan Agreement, and (iii) the
amount of the arrearage.
The 2003 Collateral Series Bonds shall be exchangeable for other
registered bonds of the same series, in the manner and upon the conditions
prescribed in the Indenture, upon the surrender of such bonds at the Investor
Services Department of the Company, as transfer agent. However, notwithstanding
the provisions of Section 2.05 of the Indenture, no charge shall be made upon
any registration of transfer or exchange of bonds of said series other than for
any tax or taxes or other governmental charge required to be paid by the
Company.
SECTION 2. The 2003 Collateral Series Bonds are not redeemable by the
operation of the maintenance and replacement provisions of this Indenture or
with the proceeds of released property.
SECTION 3. Upon the occurrence of an Event of Default under the Term
Loan Agreement and the acceleration of the Obligations, the 2003 Collateral
Series Bonds shall be redeemable in whole upon receipt by the Trustee of a
written demand from the Agent stating that there has occurred under the Term
Loan Agreement both an Event of Default and a declaration of acceleration of the
Obligations and demanding redemption of the 2003 Collateral Series Bonds
(including a description of the amount of principal, interest and fees which
comprise such Obligations). The Company waives any right it may have to prior
notice of such redemption under the Indenture. Upon surrender of the 2003
Collateral Series Bonds by the Agent to the Trustee, the 2003 Collateral Series
Bonds shall be redeemed at a redemption price equal to the aggregate amount of
the Obligations.
SECTION 4. The Company reserves the right, without any consent, vote or
other action by the holder of the 2003 Collateral Series Bonds or of any
subsequent series of bonds issued under the Indenture, to make such amendments
to the Indenture, as supplemented, as shall be necessary in order to amend
Section 17.02 to read as follows:
-56-
SECTION 17.02. With the consent of the holders of not less than a
majority in principal amount of the bonds at the time outstanding or their
attorneys-in-fact duly authorized, or, if fewer than all series are affected,
not less than a majority in principal amount of the bonds at the time
outstanding of each series the rights of the holders of which are affected,
voting together, the Company, when authorized by a resolution, and the Trustee
may from time to time and at any time enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or modifying the rights and obligations of the Company
and the rights of the holders of any of the bonds and coupons; provided,
however, that no such supplemental indenture shall (1) extend the maturity of
any of the bonds or reduce the rate or extend the time of payment of interest
thereon, or reduce the amount of the principal thereof, or reduce any premium
payable on the redemption thereof, without the consent of the holder of each
bond so affected, or (2) permit the creation of any lien, not otherwise
permitted, prior to or on a parity with the lien of this Indenture, without the
consent of the holders of all the bonds then outstanding, or (3) reduce the
aforesaid percentage of the principal amount of bonds the holders of which are
required to approve any such supplemental indenture, without the consent of the
holders of all the bonds then outstanding. For the purposes of this Section,
bonds shall be deemed to be affected by a supplemental indenture if such
supplemental indenture adversely affects or diminishes the rights of holders
thereof against the Company or against its property. The Trustee may in its
discretion determine whether or not, in accordance with the foregoing, bonds of
any particular series would be affected by any supplemental indenture and any
such determination shall be conclusive upon the holders of bonds of such series
and all other series. Subject to the provisions of Sections 16.02 and 16.03
hereof, the Trustee shall not be liable for any determination made in good faith
in connection herewith.
Upon the written request of the Company, accompanied by a resolution
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of bondholders as aforesaid
(the instrument or instruments evidencing such consent to be dated within one
year of such request), the Trustee shall join with the Company in the execution
of such supplemental indenture unless such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise, in
which case the Trustee may in its discretion but shall not be obligated to enter
into such supplemental indenture.
It shall not be necessary for the consent of the bondholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such consent shall approve the substance thereof.
The Company and the Trustee, if they so elect, and either before or
after such consent has been obtained, may require the holder of any bond
consenting to the execution of any such supplemental indenture to submit his
bond to the Trustee or to ask such bank, banker or trust company as may be
designated by the Trustee
-57-
for the purpose, for the notation thereon of the fact that the holder
of such bond has consented to the execution of such supplemental
indenture, and in such case such notation, in form satisfactory to the
Trustee, shall be made upon all bonds so submitted, and such bonds
bearing such notation shall forthwith be returned to the persons
entitled thereto.
Prior to the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the
Company shall publish a notice, setting forth in general terms the
substance of such supplemental indenture, at least once in one daily
newspaper of general circulation in each city in which the principal of
any of the bonds shall be payable, or, if all bonds outstanding shall
be registered bonds without coupons or coupon bonds registered as to
principal, such notice shall be sufficiently given if mailed, first
class, postage prepaid, and registered if the Company so elects, to
each registered holder of bonds at the last address of such holder
appearing on the registry books, such publication or mailing, as the
case may be, to be made not less than thirty days prior to such
execution. Any failure of the Company to give such notice, or any
defect therein, shall not, however, in any way impair or affect the
validity of any such supplemental indenture.
SECTION 5. As supplemented and amended as above set forth, the
Indenture is in all respects ratified and confirmed, and the Indenture and all
indentures supplemental thereto shall be read, taken and construed as one and
the same instrument.
SECTION 6. Nothing contained in this Supplemental Indenture shall, or
shall be construed to, confer upon any person other than a holder of bonds
issued under the Indenture, as supplemented and amended as above set forth, the
Company, the Trustee and the Agent, for the benefit of the Banks (as such term
is defined in the Term Loan Agreement), any right or interest to avail himself
of any benefit under any provision of the Indenture, as so supplemented and
amended.
SECTION 7. The Trustee assumes no responsibility for or in respect of
the validity or sufficiency of this Supplemental Indenture or of the Indenture
as hereby supplemented or the due execution hereof by the Company or for or in
respect of the recitals and statements contained herein (other than those
contained in the sixth, seventh and eighth recitals hereof), all of which
recitals and statements are made solely by the Company.
SECTION 8. This Supplemental Indenture may be simultaneously executed
in several counterparts and all such counterparts executed and delivered, each
as an original, shall constitute but one and the same instrument.
SECTION 9. In the event the date of any notice required or permitted
hereunder shall not be a Business Day, then (notwithstanding any other provision
of the Indenture or of any supplemental indenture thereto) such notice need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the date fixed for such notice.
"Business Day" means, with respect to this Section 9, any day, other than a
Saturday or Sunday, on which banks generally are open in Chicago, Illinois and
New York, New
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York for the conduct of substantially all of their commercial lending activities
and on which interbank wire transfers can be made on the Fedwire system.
SECTION 10. This Supplemental Indenture and the 2003 Collateral Series
Bonds shall be governed by and deemed to be a contract under, and construed in
accordance with, the laws of the State of Michigan, and for all purposes shall
be construed in accordance with the laws of such state, except as may otherwise
be required by mandatory provisions of law.
SECTION 11. Detailed Description of Property Mortgaged:
ARTICLE I:
ELECTRIC GENERATING PLANTS AND DAMS
All the electric generating plants and stations of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, including all powerhouses, buildings, reservoirs, dams,
pipelines, flumes, structures and works and the land on which the same are
situated and all water rights and all other lands and easements, rights of way,
permits, privileges, towers, poles, wires, machinery, equipment, appliances,
appurtenances and supplies and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with such
plants and stations or any of them, or adjacent thereto.
ARTICLE II:
ELECTRIC TRANSMISSION LINES
All the electric transmission lines of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including towers, poles, pole lines, wires, switches, switch racks,
switchboards, insulators and other appliances and equipment, and all other
property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such transmission lines or any of them or
adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises and rights for or relating to the construction,
maintenance or operation thereof, through, over, under or upon any private
property or any public streets or highways, within as well as without the
corporate limits of any municipal corporation. Also all the real property,
rights of way, easements, permits, privileges and rights for or relating to the
construction, maintenance or operation of certain transmission lines, the land
and rights for which are owned by the Company, which are either not built or now
being constructed.
ARTICLE III:
ELECTRIC DISTRIBUTION SYSTEMS
All the electric distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including substations, transformers, switchboards,
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towers, poles, wires, insulators, subways, trenches, conduits, manholes, cables,
meters and other appliances and equipment, and all other property, real or
personal, forming a part of or appertaining to or used, occupied or enjoyed in
connection with such distribution systems or any of them or adjacent thereto;
together with all real property, rights of way, easements, permits, privileges,
franchises, grants and rights, for or relating to the construction, maintenance
or operation thereof, through, over, under or upon any private property or any
public streets or highways within as well as without the corporate limits of any
municipal corporation.
ARTICLE IV:
ELECTRIC SUBSTATIONS, SWITCHING STATIONS AND SITES
All the substations, switching stations and sites of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, for transforming, regulating, converting or distributing or
otherwise controlling electric current at any of its plants and elsewhere,
together with all buildings, transformers, wires, insulators and other
appliances and equipment, and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with any
of such substations and switching stations, or adjacent thereto, with sites to
be used for such purposes.
ARTICLE V:
GAS COMPRESSOR STATIONS, GAS PROCESSING PLANTS,
DESULPHURIZATION STATIONS, METERING STATIONS, ODORIZING
STATIONS, REGULATORS AND SITES
All the compressor stations, processing plants, desulphurization
stations, metering stations, odorizing stations, regulators and sites of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
lien of the Indenture, for compressing, processing, desulphurizing, metering,
odorizing and regulating manufactured or natural gas at any of its plants and
elsewhere, together with all buildings, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with any of such
purposes, with sites to be used for such purposes.
ARTICLE VI:
GAS STORAGE FIELDS
The natural gas rights and interests of the Company, including wells
and well lines (but not including natural gas, oil and minerals), the gas
gathering system, the underground gas storage rights, the underground gas
storage wells and injection and withdrawal system used in connection therewith,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture: In the Overisel Gas Storage Field, located in the Township of
Overisel, Allegan County, and in the Township of Zeeland, Ottawa County,
Michigan; in the Northville Gas Storage Field located
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in the Township of Salem, Washtenaw County, Township of Lyon, Oakland County,
and the Townships of Northville and Plymouth and City of Plymouth, Wayne County,
Michigan; in the Salem Gas Storage Field, located in the Township of Salem,
Allegan County, and in the Township of Jamestown, Ottawa County, Michigan; in
the Ray Gas Storage Field, located in the Townships of Ray and Armada, Macomb
County, Michigan; in the Lenox Gas Storage Field, located in the Townships of
Lenox and Chesterfield, Macomb County, Michigan; in the Ira Gas Storage Field,
located in the Township of Ira, St. Clair County, Michigan; in the Puttygut Gas
Storage Field, located in the Township of Casco, St. Clair County, Michigan; in
the Four Corners Gas Storage Field, located in the Townships of Casco, China,
Cottrellville and Ira, St. Clair County, Michigan; in the Swan Creek Gas Storage
Field, located in the Township of Casco and Ira, St. Clair County, Michigan; and
in the Hessen Gas Storage Field, located in the Townships of Casco and Columbus,
St. Clair, Michigan.
ARTICLE VII:
GAS TRANSMISSION LINES
All the gas transmission lines of the Company, constructed or otherwise
acquired by it and not heretofore described in the Indenture or any supplement
thereto and not heretofore released from the lien of the Indenture, including
gas mains, pipes, pipelines, gates, valves, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such
transmission lines or any of them or adjacent thereto; together with all real
property, right of way, easements, permits, privileges, franchises and rights
for or relating to the construction, maintenance or operation thereof, through,
over, under or upon any private property or any public streets or highways,
within as well as without the corporate limits of any municipal corporation.
ARTICLE VIII:
GAS DISTRIBUTION SYSTEMS
All the gas distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including tunnels, conduits, gas mains and pipes, service pipes, fittings,
gates, valves, connections, meters and other appliances and equipment, and all
other property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such distribution systems or any of them
or adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises, grants and rights, for or relating to the
construction, maintenance or operation thereof, through, over, under or upon any
private property or any public streets or highways within as well as without the
corporate limits of any municipal corporation.
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ARTICLE IX:
OFFICE BUILDINGS, SERVICE BUILDINGS, GARAGES, ETC.
All office, garage, service and other buildings of the Company,
wherever located, in the State of Michigan, constructed or otherwise acquired by
it and not heretofore described in the Indenture or any supplement thereto and
not heretofore released from the lien of the Indenture, together with the land
on which the same are situated and all easements, rights of way and
appurtenances to said lands, together with all furniture and fixtures located in
said buildings.
ARTICLE X:
TELEPHONE PROPERTIES AND RADIO COMMUNICATION EQUIPMENT
All telephone lines, switchboards, systems and equipment of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
lien of the Indenture, used or available for use in the operation of its
properties, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such telephone
properties or any of them or adjacent thereto; together with all real estate,
rights of way, easements, permits, privileges, franchises, property, devices or
rights related to the dispatch, transmission, reception or reproduction of
messages, communications, intelligence, signals, light, vision or sound by
electricity, wire or otherwise, including all telephone equipment installed in
buildings used as general and regional offices, substations and generating
stations and all telephone lines erected on towers and poles; and all radio
communication equipment of the Company, together with all property, real or
personal (except any in the Indenture expressly excepted), fixed stations,
towers, auxiliary radio buildings and equipment, and all appurtenances used in
connection therewith, wherever located, in the State of Michigan.
ARTICLE XI:
OTHER REAL PROPERTY
All other real property of the Company and all interests therein, of
every nature and description (except any in the Indenture expressly excepted)
wherever located, in the State of Michigan, acquired by it and not heretofore
described in the Indenture or any supplement thereto and not heretofore released
from the line of the Indenture. Such real property includes but is not limited
to the following described property, such property is subject to any interests
that were excepted or reserved in the conveyance to the Company:
ALCONA COUNTY
Certain land in Caledonia Township, Alcona County, Michigan described
as:
The East 330 feet of the South 660 feet of the SW 1/4 of the
SW 1/4 of Section 8, T28N, R8E, except the West 264 feet of the South
330 feet thereof; said land being more particularly described as
follows: To find the place of
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beginning of this description, commence at the Southwest corner of said
section, run thence East along the South line of said section 1243 feet
to the place of beginning of this description, thence continuing East
along said South line of said section 66 feet to the West 1/8 line of
said section, thence N 02 degrees 09' 30" E along the said West 1/8
line of said section 660 feet, thence West 330 feet, thence S 02
degrees 09' 30" W, 330 feet, thence East 264 feet, thence S 02 degrees
09' 30" W, 330 feet to the place of beginning.
ALLEGAN COUNTY
Certain land in Lee Township, Allegan County, Michigan described as:
The NE 1/4 of the NW 1/4 of Section 16, T1N, R15W.
ALPENA COUNTY
Certain land in Wilson and Green Townships, Alpena County, Michigan
described as:
All that part of the S'ly 1/2 of the former Boyne City-Gaylord
and Alpena Railroad right of way, being the Southerly 50 feet of a 100
foot strip of land formerly occupied by said Railroad, running from the
East line of Section 31, T31N, R7E, Southwesterly across said Section
31 and Sections 5 and 6 of T30N, R7E and Sections 10, 11 and the E 1/2
of Section 9, except the West 1646 feet thereof, all in T30N, R6E.
ANTRIM COUNTY
Certain land in Mancelona Township, Antrim County, Michigan described
as:
The S 1/2 of the NE 1/4 of Section 33, T29N, R6W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the State of Michigan to August W. Schack and Emma H. Schack, his wife,
dated April 15, 1946 and recorded May 20, 1946 in Liber 97 of Deeds on
page 682 of Antrim County Records.
ARENAC COUNTY
Certain land in Standish Township, Arenac County, Michigan described
as:
A parcel of land in the SW 1/4 of the NW 1/4 of Section 12,
T18N, R4E, described as follows: To find the place of beginning of said
parcel of land, commence at the Northwest corner of Section 12, T18N,
R4E; run thence South along the West line of said section, said West
line of said section being also the center line of East City Limits
Road 2642.15 feet to the W 1/4 post of said section and the place of
beginning of said parcel of land; running thence N 88 degrees 26' 00" E
along the East and West 1/4 line of said section, 660.0 feet; thence
North parallel with the West line of said section, 310.0 feet; thence S
88 degrees 26' 00"
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W, 330.0 feet; thence South parallel with the West line of said
section, 260.0 feet; thence S 88 degrees 26' 00" W, 330.0 feet to the
West line of said section and the center line of East City Limits Road;
thence South along the said West line of said section, 50.0 feet to the
place of beginning.
BARRY COUNTY
Certain land in Johnstown Township, Barry County, Michigan described
as:
A strip of land 311 feet in width across the SW 1/4 of the NE
1/4 of Section 31, T1N, R8W, described as follows: To find the place of
beginning of this description, commence at the E 1/4 post of said
section; run thence N 00 degrees 55' 00" E along the East line of said
section, 555.84 feet; thence N 59 degrees 36' 20" W, 1375.64 feet;
thence N 88 degrees 30' 00" W, 130 feet to a point on the East 1/8 line
of said section and the place of beginning of this description; thence
continuing N 88 degrees 30' 00" W, 1327.46 feet to the North and South
1/4 line of said section; thence S 00 degrees 39'35" W along said North
and South 1/4 line of said section, 311.03 feet to a point, which said
point is 952.72 feet distant N'ly from the East and West 1/4 line of
said section as measured along said North and South 1/4 line of said
section; thence S 88 degrees 30' 00" E, 1326.76 feet to the East 1/8
line of said section; thence N 00 degrees 47' 20" E along said East 1/8
line of said section, 311.02 feet to the place of beginning.
BAY COUNTY
Certain land in Frankenlust Township, Bay County, Michigan described
as:
The South 250 feet of the N 1/2 of the W 1/2 of the W 1/2 of
the SE 1/4 of Section 9, T13N, R4E.
BENZIE COUNTY
Certain land in Benzonia Township, Benzie County, Michigan described
as:
A parcel of land in the Northeast 1/4 of Section 7, Township
26 North, Range 14 West, described as beginning at a point on the East
line of said Section 7, said point being 320 feet North measured along
the East line of said section from the East 1/4 post; running thence
West 165 feet; thence North parallel with the East line of said section
165 feet; thence East 165 feet to the East line of said section; thence
South 165 feet to the place of beginning.
BRANCH COUNTY
Certain land in Girard Township, Branch County, Michigan described as:
A parcel of land in the NE 1/4 of Section 23 T5S, R6W,
described as beginning at a point on the North and South quarter line
of said section at a point
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1278.27 feet distant South of the North quarter post of said section,
said distance being measured along the North and South quarter line of
said section, running thence S89 degrees21'E 250 feet, thence North
along a line parallel with the said North and South quarter line of
said section 200 feet, thence N89 degrees21'W 250 feet to the North and
South quarter line of said section, thence South along said North and
South quarter line of said section 200 feet to the place of beginning.
CALHOUN COUNTY
Certain land in Convis Township, Calhoun County, Michigan described as:
A parcel of land in the SE 1/4 of the SE 1/4 of Section 32,
T1S, R6W, described as follows: To find the place of beginning of this
description, commence at the Southeast corner of said section; run
thence North along the East line of said section 1034.32 feet to the
place of beginning of this description; running thence N 89 degrees 39'
52" W, 333.0 feet; thence North 290.0 feet to the South 1/8 line of
said section; thence S 89 degrees 39' 52" E along said South 1/8 line
of said section 333.0 feet to the East line of said section; thence
South along said East line of said section 290.0 feet to the place of
beginning. (Bearings are based on the East line of Section 32, T1S,
R6W, from the Southeast corner of said section to the Northeast corner
of said section assumed as North.)
CASS COUNTY
Certain easement rights located across land in Marcellus Township, Cass
County, Michigan described as:
The East 6 rods of the SW 1/4 of the SE 1/4 of Section 4, T5S,
R13W.
CHARLEVOIX COUNTY
Certain land in South Arm Township, Charlevoix County, Michigan
described as:
A parcel of land in the SW 1/4 of Section 29, T32N, R7W,
described as follows: Beginning at the Southwest corner of said section
and running thence North along the West line of said section 788.25
feet to a point which is 528 feet distant South of the South 1/8 line
of said section as measured along the said West line of said section;
thence N 89 degrees 30' 19" E, parallel with said South 1/8 line of
said section 442.1 feet; thence South 788.15 feet to the South line of
said section; thence S 89 degrees 29' 30" W, along said South line of
said section 442.1 feet to the place of beginning.
CHEBOYGAN COUNTY
Certain land in Inverness Township, Cheboygan County, Michigan
described as:
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A parcel of land in the SW frl 1/4 of Section 31, T37N, R2W,
described as beginning at the Northwest corner of the SW frl 1/4,
running thence East on the East and West quarter line of said Section,
40 rods, thence South parallel to the West line of said Section 40
rods, thence West 40 rods to the West line of said Section, thence
North 40 rods to the place of beginning.
CLARE COUNTY
Certain land in Frost Township, Clare County, Michigan described as:
The East 150 feet of the North 225 feet of the NW 1/4 of the
NW 1/4 of Section 15, T20N, R4W.
CLINTON COUNTY
Certain land in Watertown Township, Clinton County, Michigan described
as:
The NE 1/4 of the NE 1/4 of the SE 1/4 of Section 22, and the
North 165 feet of the NW 1/4 of the NE 1/4 of the SE 1/4 of Section 22,
T5N, R3W.
CRAWFORD COUNTY
Certain land in Lovells Township, Crawford County, Michigan described
as:
A parcel of land in Section 1, T28N, R1W, described as:
Commencing at NW corner said section; thence South 89 degrees53'30"
East along North section line 105.78 feet to point of beginning; thence
South 89 degrees53'30" East along North section line 649.64 feet;
thence South 55 degrees 42'30" East 340.24 feet; thence South 55
degrees 44' 37" East 5,061.81 feet to the East section line; thence
South 00 degrees 00' 08" West along East section line 441.59 feet;
thence North 55 degrees 44' 37" West 5,310.48 feet; thence North 55
degrees 42'30" West 877.76 feet to point of beginning.
EATON COUNTY
Certain land in Eaton Township, Eaton County, Michigan described as:
A parcel of land in the SW 1/4 of Section 6, T2N, R4W,
described as follows: To find the place of beginning of this
description commence at the Southwest corner of said section; run
thence N 89 degrees 51' 30" E along the South line of said section 400
feet to the place of beginning of this description; thence continuing N
89 degrees 51' 30" E, 500 feet; thence N 00 degrees 50' 00" W, 600
feet; thence S 89 degrees 51' 30" W parallel with the South line of
said section 500 feet; thence S 00 degrees 50' 00" E, 600 feet to the
place of beginning.
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EMMET COUNTY
Certain land in Wawatam Township, Emmet County, Michigan described as:
The West 1/2 of the Northeast 1/4 of the Northeast 1/4 of
Section 23, T39N, R4W.
GENESEE COUNTY
Certain land in Argentine Township, Genesee County, Michigan described
as:
A parcel of land of part of the SW 1/4 of Section 8, T5N, R5E,
being more particularly described as follows:
Beginning at a point of the West line of Duffield Road, 100
feet wide, (as now established) distant 829.46 feet measured N01
degrees42'56"W and 50 feet measured S88 degrees14'04"W from the South
quarter corner, Section 8, T5N, R5E; thence S88 degrees14'04"W a
distance of 550 feet; thence N01 degrees42'56"W a distance of 500 feet
to a point on the North line of the South half of the Southwest quarter
of said Section 8; thence N88 degrees14'04"E along the North line of
South half of the Southwest quarter of said Section 8 a distance 550
feet to a point on the West line of Duffield Road, 100 feet wide (as
now established); thence S01 degrees42'56"E along the West line of said
Duffield Road a distance of 500 feet to the point of beginning.
GLADWIN COUNTY
Certain land in Secord Township, Gladwin County, Michigan described as:
The East 400 feet of the South 450 feet of Section 2, T19N,
R1E.
GRAND TRAVERSE COUNTY
Certain land in Mayfield Township, Grand Traverse County, Michigan
described as:
A parcel of land in the Northwest 1/4 of Section 3, T25N,
R11W, described as follows: Commencing at the Northwest corner of said
section, running thence S 89 degrees19'15" E along the North line of
said section and the center line of Clouss Road 225 feet, thence South
400 feet, thence N 89 degrees19'15" W 225 feet to the West line of said
section and the center line of Hannah Road, thence North along the West
line of said section and the center line of Hannah Road 400 feet to the
place of beginning for this description.
GRATIOT COUNTY
Certain land in Fulton Township, Gratiot County, Michigan described as:
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A parcel of land in the NE 1/4 of Section 7, Township 9 North,
Range 3 West, described as beginning at a point on the North line of
George Street in the Village of Middleton, which is 542 feet East of
the North and South one-quarter (1/4) line of said Section 7; thence
North 100 feet; thence East 100 feet; thence South 100 feet to the
North line of George Street; thence West along the North line of George
Street 100 feet to place of beginning.
HILLSDALE COUNTY
Certain land in Litchfield Village, Hillsdale County, Michigan
described as:
Lot 238 of Block three (3) of Assessors Plat of the Village of
Litchfield.
HURON COUNTY
Certain easement rights located across land in Sebewaing Township,
Huron County, Michigan described as:
The North 1/2 of the Northwest 1/4 of Section 15, T15N, R9E.
INGHAM COUNTY
Certain land in Vevay Township, Ingham County, Michigan described as:
A parcel of land 660 feet wide in the Southwest 1/4 of Section
7 lying South of the centerline of Sitts Road as extended to the
North-South 1/4 line of said Section 7, T2N, R1W, more particularly
described as follows: Commence at the Southwest corner of said Section
7, thence North along the West line of said Section 2502.71 feet to the
centerline of Sitts Road; thence South 89 degrees54'45" East along said
centerline 2282.38 feet to the place of beginning of this description;
thence continuing South 89 degrees54'45" East along said centerline and
said centerline extended 660.00 feet to the North-South 1/4 line of
said section; thence South 00 degrees07'20" West 1461.71 feet; thence
North 89 degrees34'58" West 660.00 feet; thence North 00 degrees07'20"
East 1457.91 feet to the centerline of Sitts Road and the place of
beginning.
IONIA COUNTY
Certain land in Sebewa Township, Ionia County, Michigan described as:
A strip of land 280 feet wide across that part of the SW 1/4
of the NE 1/4 of Section 15, T5N, R6W, described as follows:
To find the place of beginning of this description commence at
the E 1/4 corner of said section; run thence N 00 degrees 05' 38" W
along the East line of said section, 1218.43 feet; thence S 67 degrees
18' 24" W, 1424.45 feet to the East 1/8 line of said section and the
place of beginning of this description; thence continuing S 67 degrees
18' 24" W, 1426.28 feet to the North and South 1/4 line
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of said section at a point which said point is 105.82 feet distant N'ly
of the center of said section as measured along said North and South
1/4 line of said section; thence N 00 degrees 04' 47" E along said
North and South 1/4 line of said section, 303.67 feet; thence N 67
degrees 18' 24" E, 1425.78 feet to the East 1/8 line of said section;
thence S 00 degrees 00' 26" E along said East 1/8 line of said section,
303.48 feet to the place of beginning. (Bearings are based on the East
line of Section 15, T5N, R6W, from the E 1/4 corner of said section to
the Northeast corner of said section assumed as N 00 degrees 05' 38"
W.)
IOSCO COUNTY
Certain land in Alabaster Township, Iosco County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 34, T21N, R7E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence
South along the North and South 1/4 line of said section, 1354.40 feet
to the place of beginning of this description; thence continuing South
along the said North and South 1/4 line of said section, 165.00 feet to
a point on the said North and South 1/4 line of said section which said
point is 1089.00 feet distant North of the center of said section;
thence West 440.00 feet; thence North 165.00 feet; thence East 440.00
feet to the said North and South 1/4 line of said section and the place
of beginning.
ISABELLA COUNTY
Certain land in Chippewa Township, Isabella County, Michigan described
as:
The North 8 rods of the NE 1/4 of the SE 1/4 of Section 29,
T14N, R3W.
JACKSON COUNTY
Certain land in Waterloo Township, Jackson County, Michigan described
as:
A parcel of land in the North fractional part of the N
fractional 1/2 of Section 2, T1S, R2E, described as follows: To find
the place of beginning of this description commence at the E 1/4 post
of said section; run thence N 01 degrees 03' 40" E along the East line
of said section 1335.45 feet to the North 1/8 line of said section and
the place of beginning of this description; thence N 89 degrees 32' 00"
W, 2677.7 feet to the North and South 1/4 line of said section; thence
S 00 degrees 59' 25" W along the North and South 1/4 line of said
section 22.38 feet to the North 1/8 line of said section; thence S 89
degrees 59' 10" W along the North 1/8 line of said section 2339.4 feet
to the center line of State Trunkline Highway M-52; thence N 53 degrees
46' 00" W along the center line of said State Trunkline Highway 414.22
feet to the West line of said section; thence N 00 degrees 55' 10" E
along the West line of said section 74.35 feet; thence S 89 degrees 32'
00" E, 5356.02 feet to the East line of said section; thence S 01
degrees 03' 40" W along the East line of said section 250 feet to the
place of beginning.
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KALAMAZOO COUNTY
Certain land in Alamo Township, Kalamazoo County, Michigan described
as:
The South 350 feet of the NW 1/4 of the NW 1/4 of Section 16,
T1S, R12W, being more particularly described as follows: To find the
place of beginning of this description, commence at the Northwest
corner of said section; run thence S 00 degrees 36' 55" W along the
West line of said section 971.02 feet to the place of beginning of this
description; thence continuing S 00 degrees 36' 55" W along said West
line of said section 350.18 feet to the North 1/8 line of said section;
thence S 87 degrees 33' 40" E along the said North 1/8 line of said
section 1325.1 feet to the West 1/8 line of said section; thence N 00
degrees 38' 25" E along the said West 1/8 line of said section 350.17
feet; thence N 87 degrees 33' 40" W, 1325.25 feet to the place of
beginning.
KALKASKA COUNTY
Certain land in Kalkaska Township, Kalkaska County, Michigan described
as:
The NW 1/4 of the SW 1/4 of Section 4, T27N, R7W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the Department of Conservation for the State of Michigan to George
Welker and Mary Welker, his wife, dated October 9, 1934 and recorded
December 28, 1934 in Liber 39 on page 291 of Kalkaska County Records,
and subject to easement for pipeline purposes as granted to Michigan
Consolidated Gas Company by first party herein on April 4, 1963 and
recorded June 21, 1963 in Liber 91 on page 631 of Kalkaska County
Records.
KENT COUNTY
Certain land in Caledonia Township, Kent County, Michigan described as:
A parcel of land in the Northwest fractional 1/4 of Section
15, T5N, R10W, described as follows: To find the place of beginning of
this description commence at the North 1/4 corner of said section, run
thence S 0 degrees 59' 26" E along the North and South 1/4 line of said
section 2046.25 feet to the place of beginning of this description,
thence continuing S 0 degrees 59' 26" E along said North and South 1/4
line of said section 332.88 feet, thence S 88 degrees 58' 30" W 2510.90
feet to a point herein designated "Point A" on the East bank of the
Thornapple River, thence continuing S 88 degrees 53' 30" W to the
center thread of the Thornapple River, thence NW'ly along the center
thread of said Thornapple River to a point which said point is S 88
degrees 58' 30" W of a point on the East bank of the Thornapple River
herein designated "Point B", said "Point B" being N 23 degrees 41' 35"
W 360.75 feet from said above-described "Point A", thence N 88 degrees
58' 30" E to said "Point B", thence continuing N 88 degrees 58' 30" E
2650.13 feet to the place of beginning. (Bearings are based on the East
line of
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Section 15, T5N, R10W between the East 1/4 corner of said section and
the Northeast corner of said section assumed as N 0 degrees 59' 55" W.)
LAKE COUNTY
Certain land in Pinora and Cherry Valley Townships, Lake County,
Michigan described as:
A strip of land 50 feet wide East and West along and adjoining
the West line of highway on the East side of the North 1/2 of Section
13 T18N, R12W. Also a strip of land 100 feet wide East and West along
and adjoining the East line of the highway on the West side of
following described land: The South 1/2 of NW 1/4, and the South 1/2 of
the NW 1/4 of the SW 1/4, all in Section 6, T18N, R11W.
LAPEER COUNTY
Certain land in Hadley Township, Lapeer County, Michigan described as:
The South 825 feet of the W 1/2 of the SW 1/4 of Section 24,
T6N, R9E, except the West 1064 feet thereof.
LEELANAU COUNTY
Certain land in Cleveland Township, Leelanau County, Michigan described
as:
The North 200 feet of the West 180 feet of the SW 1/4 of the
SE 1/4 of Section 35, T29N, R13W.
LENAWEE COUNTY
Certain land in Madison Township, Lenawee County, Michigan described
as:
A strip of land 165 feet wide off the West side of the
following described premises: The E 1/2 of the SE 1/4 of Section 12.
The E 1/2 of the NE 1/4 and the NE 1/4 of the SE 1/4 of Section 13,
being all in T7S, R3E, excepting therefrom a parcel of land in the E
1/2 of the SE 1/4 of Section 12, T7S, R3E, beginning at the Northwest
corner of said E 1/2 of the SE 1/4 of Section 12, running thence East 4
rods, thence South 6 rods, thence West 4 rods, thence North 6 rods to
the place of beginning.
LIVINGSTON COUNTY
Certain land in Cohoctah Township, Livingston County, Michigan
described as:
Parcel 1
The East 390 feet of the East 50 rods of the SW 1/4 of Section
30, T4N, R4E.
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Parcel 2
A parcel of land in the NW 1/4 of Section 31, T4N, R4E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence N 89
degrees 13' 06" W along the North line of said section, 330 feet to the
place of beginning of this description; running thence S 00 degrees 52'
49" W, 2167.87 feet; thence N 88 degrees 59' 49" W, 60 feet; thence N
00 degrees 52' 49" E, 2167.66 feet to the North line of said section;
thence S 89 degrees 13' 06" E along said North line of said section, 60
feet to the place of beginning.
MACOMB COUNTY
Certain land in Macomb Township, Macomb County, Michigan described as:
A parcel of land commencing on the West line of the E 1/2 of
the NW 1/4 of fractional Section 6, 20 chains South of the NW corner of
said E 1/2 of the NW 1/4 of Section 6; thence South on said West line
and the East line of A. Henry Kotner's Hayes Road Subdivision #15,
according to the recorded plat thereof, as recorded in Liber 24 of
Plats, on page 7, 24.36 chains to the East and West 1/4 line of said
Section 6; thence East on said East and West 1/4 line 8.93 chains;
thence North parallel with the said West line of the E 1/2 of the NW
1/4 of Section 6, 24.36 chains; thence West 8.93 chains to the place of
beginning, all in T3N, R13E.
MANISTEE COUNTY
Certain land in Manistee Township, Manistee County, Michigan described
as:
A parcel of land in the SW 1/4 of Section 20, T22N, R16W,
described as follows: To find the place of beginning of this
description, commence at the Southwest corner of said section; run
thence East along the South line of said section 832.2 feet to the
place of beginning of this description; thence continuing East along
said South line of said section 132 feet; thence North 198 feet; thence
West 132 feet; thence South 198 feet to the place of beginning,
excepting therefrom the South 2 rods thereof which was conveyed to
Manistee Township for highway purposes by a Quitclaim Deed dated June
13, 1919 and recorded July 11, 1919 in Liber 88 of Deeds on page 638 of
Manistee County Records.
MASON COUNTY
Certain land in Riverton Township, Mason County, Michigan described as:
Parcel 1
The South 10 acres of the West 20 acres of the S 1/2 of the NE
1/4 of Section 22, T17N, R17W.
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Parcel 2
A parcel of land containing 4 acres of the West side of
highway, said parcel of land being described as commencing 16 rods
South of the Northwest corner of the NW 1/4 of the SW 1/4 of Section
22, T17N, R17W, running thence South 64 rods, thence NE'ly and N'ly and
NW'ly along the W'ly line of said highway to the place of beginning,
together with any and all right, title, and interest of Howard C.
Wicklund and Katherine E. Wicklund in and to that portion of the
hereinbefore mentioned highway lying adjacent to the E'ly line of said
above described land.
MECOSTA COUNTY
Certain land in Wheatland Township, Mecosta County, Michigan described
as:
A parcel of land in the SW 1/4 of the SW 1/4 of Section 16,
T14N, R7W, described as beginning at the Southwest corner of said
section; thence East along the South line of Section 133 feet; thence
North parallel to the West section line 133 feet; thence West 133 feet
to the West line of said Section; thence South 133 feet to the place of
beginning.
MIDLAND COUNTY
Certain land in Ingersoll Township, Midland County, Michigan described
as:
The West 200 feet of the W 1/2 of the NE 1/4 of Section 4,
T13N, R2E.
MISSAUKEE COUNTY
Certain land in Norwich Township, Missaukee County, Michigan described
as:
A parcel of land in the NW 1/4 of the NW 1/4 of Section 16,
T24N, R6W, described as follows: Commencing at the Northwest corner of
said section, running thence N 89 degrees 01' 45" E along the North
line of said section 233.00 feet; thence South 233.00 feet; thence S 89
degrees 01' 45" W, 233.00 feet to the West line of said section; thence
North along said West line of said section 233.00 feet to the place of
beginning. (Bearings are based on the West line of Section 16, T24N,
R6W, between the Southwest and Northwest corners of said section
assumed as North.)
MONROE COUNTY
Certain land in Whiteford Township, Monroe County, Michigan described
as:
A parcel of land in the SW1/4 of Section 20, T8S, R6E,
described as follows: To find the place of beginning of this
description commence at the S 1/4 post of said section; run thence West
along the South line of said section 1269.89 feet to the place of
beginning of this description; thence continuing West along
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said South line of said section 100 feet; thence N 00 degrees 50' 35"
E, 250 feet; thence East 100 feet; thence S 00 degrees 50' 35" W
parallel with and 16.5 feet distant W'ly of as measured perpendicular
to the West 1/8 line of said section, as occupied, a distance of 250
feet to the place of beginning.
MONTCALM COUNTY
Certain land in Crystal Township, Montcalm County, Michigan described
as:
The N 1/2 of the S 1/2 of the SE 1/4 of Section 35, T10N, R5W.
MONTMORENCY COUNTY
Certain land in the Village of Hillman, Montmorency County, Michigan
described as:
Lot 14 of Hillman Industrial Park, being a subdivision in the
South 1/2 of the Northwest 1/4 of Section 24, T31N, R4E, according to
the plat thereof recorded in Liber 4 of Plats on Pages 32-34,
Montmorency County Records.
MUSKEGON COUNTY
Certain land in Casnovia Township, Muskegon County, Michigan described
as:
The West 433 feet of the North 180 feet of the South 425 feet
of the SW 1/4 of Section 3, T10N, R13W.
NEWAYGO COUNTY
Certain land in Ashland Township, Newaygo County, Michigan described
as:
The West 250 feet of the NE 1/4 of Section 23, T11N, R13W.
OAKLAND COUNTY
Certain land in Wixcom City, Oakland County, Michigan described as:
The E 75 feet of the N 160 feet of the N 330 feet of the W
526.84 feet of the NW 1/4 of the NW 1/4 of Section 8, T1N, R8E, more
particularly described as follows: Commence at the NW corner of said
Section 8, thence N 87 degrees 14' 29" E along the North line of said
Section 8 a distance of 451.84 feet to the place of beginning for this
description; thence continuing N 87 degrees 14' 29" E along said North
section line a distance of 75.0 feet to the East line of the West
526.84 feet of the NW 1/4 of the NW 1/4 of said Section 8; thence S 02
degrees 37' 09" E along said East line a distance of 160.0 feet; thence
S 87 degrees 14' 29" W a distance of 75.0 feet; thence N 02 degrees 37'
09" W a distance of 160.0 feet to the place of beginning.
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OCEANA COUNTY
Certain land in Crystal Township, Oceana County, Michigan described as:
The East 290 feet of the SE 1/4 of the NW 1/4 and the East 290
feet of the NE 1/4 of the SW 1/4, all in Section 20, T16N, R16W.
OGEMAW COUNTY
Certain land in West Branch Township, Ogemaw County, Michigan described
as:
The South 660 feet of the East 660 feet of the NE 1/4 of the
NE 1/4 of Section 33, T22N, R2E.
OSCEOLA COUNTY
Certain land in Hersey Township, Osceola County, Michigan described as:
A parcel of land in the North 1/2 of the Northeast 1/4 of
Section 13, T17N, R9W, described as commencing at the Northeast corner
of said Section; thence West along the North Section line 999 feet to
the point of beginning of this description; thence S 01 degrees 54' 20"
E 1327.12 feet to the North 1/8 line; thence S 89 degrees 17' 05" W
along the North 1/8 line 330.89 feet; thence N 01 degrees 54' 20" W
1331.26 feet to the North Section line; thence East along the North
Section line 331 feet to the point of beginning.
OSCODA COUNTY
Certain land in Comins Township, Oscoda County, Michigan described as:
The East 400 feet of the South 580 feet of the W 1/2 of the SW
1/4 of Section 15, T27N, R3E.
OTSEGO COUNTY
Certain land in Corwith Township, Otsego County, Michigan described as:
Part of the NW 1/4 of the NE 1/4 of Section 28, T32N, R3W,
described as: Beginning at the N 1/4 corner of said section; running
thence S 89 degrees 04' 06" E along the North line of said section,
330.00 feet; thence S 00 degrees 28' 43" E, 400.00 feet; thence N 89
degrees 04' 06" W, 330.00 feet to the North and South 1/4 line of said
section; thence N 00 degrees 28' 43" W along the said North and South
1/4 line of said section, 400.00 feet to the point of beginning;
subject to the use of the N'ly 33.00 feet thereof for highway purposes.
OTTAWA COUNTY
Certain land in Robinson Township, Ottawa County, Michigan described
as:
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The North 660 feet of the West 660 feet of the NE 1/4 of the
NW 1/4 of Section 26, T7N, R15W.
PRESQUE ISLE COUNTY
Certain land in Belknap and Pulawski Townships, Presque Isle County,
Michigan described as:
Part of the South half of the Northeast quarter, Section 24,
T34N, R5E, and part of the Northwest quarter, Section 19, T34N, R6E,
more fully described as: Commencing at the East 1/4 corner of said
Section 24; thence N 00 degrees15'47" E, 507.42 feet, along the East
line of said Section 24 to the point of beginning; thence S 88
degrees15'36" W, 400.00 feet, parallel with the North 1/8 line of said
Section 24; thence N 00 degrees15'47" E, 800.00 feet, parallel with
said East line of Section 24; thence N 88 degrees15'36"E, 800.00 feet,
along said North 1/8 line of Section 24 and said line extended; thence
S 00 degrees15'47" W, 800.00 feet, parallel with said East line of
Section 24; thence S 88 degrees15'36" W, 400.00 feet, parallel with
said North 1/8 line of Section 24 to the point of beginning.
Together with a 33 foot easement along the West 33 feet of the
Northwest quarter lying North of the North 1/8 line of Section 24,
Belknap Township, extended, in Section 19, T34N, R6E.
ROSCOMMON COUNTY
Certain land in Gerrish Township, Roscommon County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 19, T24N, R3W,
described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section, run
thence East along the North line of said section 1,163.2 feet to the
place of beginning of this description (said point also being the place
of intersection of the West 1/8 line of said section with the North
line of said section), thence S 01 degrees 01' E along said West 1/8
line 132 feet, thence West parallel with the North line of said section
132 feet, thence N 01 degrees 01' W parallel with said West 1/8 line of
said section 132 feet to the North line of said section, thence East
along the North line of said section 132 feet to the place of
beginning.
SAGINAW COUNTY
Certain land in Chapin Township, Saginaw County, Michigan described as:
A parcel of land in the SW 1/4 of Section 13, T9N, R1E,
described as follows: To find the place of beginning of this
description commence at the Southwest corner of said section; run
thence North along the West line of said section 1581.4 feet to the
place of beginning of this description; thence continuing North along
said West line of said section 230 feet to the center line of a creek;
-76-
thence S 70 degrees 07' 00" E along said center line of said creek
196.78 feet; thence South 163.13 feet; thence West 185 feet to the West
line of said section and the place of beginning.
SANILAC COUNTY
Certain easement rights located across land in Minden Township, Sanilac
County, Michigan described as:
The Southeast 1/4 of the Southeast 1/4 of Section 1, T14N,
R14E, excepting therefrom the South 83 feet of the East 83 feet
thereof.
SHIAWASSEE COUNTY
Certain land in Burns Township, Shiawassee County, Michigan described
as:
The South 330 feet of the E 1/2 of the NE 1/4 of Section 36,
T5N, R4E.
ST. CLAIR COUNTY
Certain land in Ira Township, St. Clair County, Michigan described as:
The N 1/2 of the NW 1/4 of the NE 1/4 of Section 6, T3N, R15E.
ST. JOSEPH COUNTY
Certain land in Mendon Township, St. Joseph County, Michigan described
as:
The North 660 feet of the West 660 feet of the NW 1/4 of SW
1/4, Section 35, T5S, R10W.
TUSCOLA COUNTY
Certain land in Millington Township, Tuscola County, Michigan described
as:
A strip of land 280 feet wide across the East 96 rods of the
South 20 rods of the N 1/2 of the SE 1/4 of Section 34, T10N, R8E, more
particularly described as commencing at the Northeast corner of Section
3, T9N, R8E, thence S 89 degrees 55' 35" W along the South line of said
Section 34 a distance of 329.65 feet, thence N 18 degrees 11' 50" W a
distance of 1398.67 feet to the South 1/8 line of said Section 34 and
the place of beginning for this description; thence continuing N 18
degrees 11' 50" W a distance of 349.91 feet; thence N 89 degrees 57'
01" W a distance of 294.80 feet; thence S 18 degrees 11' 50" E a
distance of 350.04 feet to the South 1/8 line of said Section 34;
thence S 89 degrees 58' 29" E along the South 1/8 line of said section
a distance of 294.76 feet to the place of beginning.
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VAN BUREN COUNTY
Certain land in Covert Township, Van Buren County, Michigan described
as:
All that part of the West 20 acres of the N 1/2 of the NE
fractional 1/4 of Section 1, T2S, R17W, except the West 17 rods of the
North 80 rods, being more particularly described as follows: To find
the place of beginning of this description commence at the N 1/4 post
of said section; run thence N 89 degrees 29' 20" E along the North line
of said section 280.5 feet to the place of beginning of this
description; thence continuing N 89 degrees 29' 20" E along said North
line of said section 288.29 feet; thence S 00 degrees 44' 00" E,
1531.92 feet; thence S 89 degrees 33' 30" W, 568.79 feet to the North
and South 1/4 line of said section; thence N 00 degrees 44' 00" W along
said North and South 1/4 line of said section 211.4 feet; thence N 89
degrees 29' 20" E, 280.5 feet; thence N 00 degrees 44' 00" W, 1320 feet
to the North line of said section and the place of beginning.
WASHTENAW COUNTY
Certain land in Manchester Township, Washtenaw County, Michigan
described as:
A parcel of land in the NE 1/4 of the NW 1/4 of Section 1,
T4S, R3E, described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section; run
thence East along the North line of said section 1355.07 feet to the
West 1/8 line of said section; thence S 00 degrees 22' 20" E along said
West 1/8 line of said section 927.66 feet to the place of beginning of
this description; thence continuing S 00 degrees 22' 20" E along said
West 1/8 line of said section 660 feet to the North 1/8 line of said
section; thence N 86 degrees 36' 57" E along said North 1/8 line of
said section 660.91 feet; thence N 00 degrees22' 20" W, 660 feet;
thence S 86 degrees 36' 57" W, 660.91 feet to the place of beginning.
WAYNE COUNTY
Certain land in Livonia City, Wayne County, Michigan described as:
Commencing at the Southeast corner of Section 6, T1S, R9E;
thence North along the East line of Section 6 a distance of 253 feet to
the point of beginning; thence continuing North along the East line of
Section 6 a distance of 50 feet; thence Westerly parallel to the South
line of Section 6, a distance of 215 feet; thence Southerly parallel to
the East line of Section 6 a distance of 50 feet; thence easterly
parallel with the South line of Section 6 a distance of 215 feet to the
point of beginning.
WEXFORD COUNTY
Certain land in Selma Township, Wexford County, Michigan described as:
A parcel of land in the NW 1/4 of Section 7, T22N, R10W,
described as beginning on the North line of said section at a point 200
feet East of the West line of said section, running thence East along
said North section line 450 feet,
-78-
thence South parallel with said West section line 350 feet, thence West
parallel with said North section line 450 feet, thence North parallel
with said West section line 350 feet to the place of beginning.
SECTION 12. The Company is a transmitting utility under Section 9401(5)
of the Michigan Uniform Commercial Code (M.C.L. 440.9401(5)) as defined in
M.C.L. 440.9105(n).
-79-
IN WITNESS WHEREOF, said Consumers Energy Company has caused this
Supplemental Indenture to be executed in its corporate name by its Chairman of
the Board, President, a Vice President or its Treasurer and its corporate seal
to be hereunto affixed and to be attested by its Secretary or an Assistant
Secretary, and said JPMorgan Chase Bank, as Trustee as aforesaid, to evidence
its acceptance hereof, has caused this Supplemental Indenture to be executed in
its corporate name by a Vice President and its corporate seal to be hereunto
affixed and to be attested by a Trust Officer, in several counterparts, all as
of the day and year first above written.
-80-
CONSUMERS ENERGY COMPANY
(SEAL) By
----------------------------
Laura L. Mountcastle
Attest: Vice President and Treasurer
- ----------------------------
Don A. Forsblom
Assistant Secretary
Signed, sealed and delivered
by CONSUMERS ENERGY COMPANY
in the presence of
- ----------------------------
Kimberly C. Wilson
- ----------------------------
Sammie B. Dalton
STATE OF MICHIGAN )
ss.
COUNTY OF JACKSON )
The foregoing instrument was acknowledged before me this ___
day of ____________, 2002, by Laura L. Mountcastle, Vice President and Treasurer
of CONSUMERS ENERGY COMPANY, a Michigan corporation, on behalf of the
corporation.
------------------------------------
Margaret Hillman, Notary Public
[Seal] Jackson County, Michigan
My Commission Expires: June 14, 2004
-81-
JPMORGAN CHASE BANK, AS TRUSTEE
(SEAL) By
----------------------------
L. O'Brien
Attest: Vice President
- ----------------------------
Trust Officer
Signed, sealed and delivered
by JPMORGAN CHASE BANK
in the presence of
- ----------------------------
- ----------------------------
STATE OF NEW YORK )
ss.
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me this ____
day of _____________, 2002, by L. O'Brien, a Vice President of JPMORGAN CHASE
BANK, a New York corporation, on behalf of the corporation.
--------------------------------------
Notary Public
[Seal] New York County, New York
My Commission Expires:
Prepared by:
Kimberly C. Wilson
212 West Michigan Avenue
Jackson, MI 49201
A-1
When recorded, return to:
Consumers Energy Company
General Services Real Estate Department
Attn: Nancy P. Fisher, P-21-411
1945 W. Parnall Road
Jackson, MI 49201
EXHIBIT A-2
[FORM OF INCREMENTAL SUPPLEMENTAL INDENTURE]
EIGHTY-SIXTH SUPPLEMENTAL INDENTURE
PROVIDING AMONG OTHER THINGS FOR
FIRST MORTGAGE BONDS,
COLLATERAL SERIES DUE 2003
--------------
DATED AS OF [ ] , 2002
---------- ---
--------------
CONSUMERS ENERGY COMPANY
TO
JPMORGAN CHASE BANK,
TRUSTEE
Counterpart _____ of 85
THIS EIGHTY-SIXTH SUPPLEMENTAL INDENTURE, dated as of [____________]
_____, 2002 (herein sometimes referred to as "this Supplemental Indenture"),
made and entered into by and between CONSUMERS ENERGY COMPANY, a corporation
organized and existing under the laws of the State of Michigan, with its
principal executive office and place of business at 212 West Michigan Avenue, in
Jackson, Jackson County, Michigan 49201, formerly known as Consumers Power
Company (hereinafter sometimes referred to as the "Company"), and JPMORGAN CHASE
BANK, a corporation organized and existing under the laws of the State of New
York, with its corporate trust offices at 450 W. 33rd Street, in the Borough of
Manhattan, The City of New York, New York 10001 (hereinafter sometimes referred
to as the "Trustee"), as Trustee under the Indenture dated as of September 1,
1945 between Consumers Power Company, a Maine corporation (hereinafter sometimes
referred to as the "Maine corporation"), and City Bank Farmers Trust Company
(Citibank, N.A., successor, hereinafter sometimes referred to as the
"Predecessor Trustee"), securing bonds issued and to be issued as provided
therein (hereinafter sometimes referred to as the "Indenture"),
WHEREAS at the close of business on January 30, 1959, City Bank Farmers
Trust Company was converted into a national banking association under the title
"First National City Trust Company"; and
WHEREAS at the close of business on January 15, 1963, First National
City Trust Company was merged into First National City Bank; and
WHEREAS at the close of business on October 31, 1968, First National
City Bank was merged into The City Bank of New York, National Association, the
name of which was thereupon changed to First National City Bank; and
WHEREAS effective March 1, 1976, the name of First National City Bank
was changed to Citibank, N.A.; and
WHEREAS effective July 16, 1984, Manufacturers Hanover Trust Company
succeeded Citibank, N.A. as Trustee under the Indenture; and
WHEREAS effective June 19, 1992, Chemical Bank succeeded by merger to
Manufacturers Hanover Trust Company as Trustee under the Indenture; and
WHEREAS effective July 15, 1996, The Chase Manhattan Bank (National
Association), merged with and into Chemical Bank which thereafter was renamed
The Chase Manhattan Bank; and
WHEREAS effective November 11, 2001, The Chase Manhattan Bank merged
with Morgan Guaranty Trust Company of New York and the surviving corporation was
renamed JPMorgan Chase Bank; and
WHEREAS the Indenture was executed and delivered for the purpose of
securing such bonds as may from time to time be issued under and in accordance
with the terms of the Indenture, the aggregate principal amount of bonds to be
secured thereby being limited to $5,000,000,000 at any one time outstanding
(except as provided in Section 2.01 of the Indenture), and the Indenture
describes and sets forth the property conveyed thereby and is filed in the
Office of the Secretary of State of the State of Michigan and is of record in
the Office of
-1-
the Register of Deeds of each county in the State of Michigan in which this
Supplemental Indenture is to be recorded; and
WHEREAS the Indenture has been supplemented and amended by various
indentures supplemental thereto, each of which is filed in the Office of the
Secretary of State of the State of Michigan and is of record in the Office of
the Register of Deeds of each county in the State of Michigan in which this
Supplemental Indenture is to be recorded; and
WHEREAS the Company and the Maine corporation entered into an Agreement
of Merger and Consolidation, dated as of February 14, 1968, which provided for
the Maine corporation to merge into the Company; and
WHEREAS the effective date of such Agreement of Merger and
Consolidation was June 6, 1968, upon which date the Maine corporation was merged
into the Company and the name of the Company was changed from "Consumers Power
Company of Michigan" to "Consumers Power Company"; and
WHEREAS the Company and the Predecessor Trustee entered into a
Sixteenth Supplemental Indenture, dated as of June 4, 1968, which provided,
among other things, for the assumption of the Indenture by the Company; and
WHEREAS said Sixteenth Supplemental Indenture became effective on the
effective date of such Agreement of Merger and Consolidation; and
WHEREAS the Company has succeeded to and has been substituted for the
Maine corporation under the Indenture with the same effect as if it had been
named therein as the mortgagor corporation; and
WHEREAS effective March 11, 1997, the name of Consumers Power Company
was changed to Consumers Energy Company; and
WHEREAS, the Company has entered into a Term Loan Agreement dated as of
October ___, 2002 (as amended or otherwise modified from time to time, the "Term
Loan Agreement") among the Company, various financial institutions and Bank One,
NA (Main Office - Chicago), as administrative agent (in such capacity, the
"Agent") for the Banks (as such term is defined in the Term Loan Agreement)
providing for the making of certain financial accommodations thereunder, and
pursuant to such Term Loan Agreement the Company has agreed to issue to the
Agent, as evidence of and security for the Obligations (as such term is defined
in the Term Loan Agreement), a new series of bonds under the Indenture; and
WHEREAS, for such purposes the Company desires to issue a new series of
bonds, to be designated First Mortgage Bonds, Collateral Series due 2003, each
of which bonds shall also bear the descriptive title "First Mortgage Bond"
(hereinafter provided for and hereinafter sometimes referred to as the "2003
Collateral Series Bonds"), the bonds of which series are to be issued as
registered bonds without coupons and are to bear interest at the rate per annum
specified herein and are to mature April 15, 2003; and
WHEREAS, each of the registered bonds without coupons of the 2003
Collateral Series Bonds and the Trustee's Authentication Certificate thereon are
to be substantially in the following form, to wit:
-2-
[FORM OF REGISTERED BOND OF THE 2003 COLLATERAL SERIES BONDS]
[FACE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND
COLLATERAL SERIES DUE 2003
No. 1 $[INSERT
AMOUNT OF
DEFERRED DRAW
TERM LOAN]
CONSUMERS ENERGY COMPANY, a Michigan corporation (hereinafter called
the "Company"), for value received, hereby promises to pay to Bank One, NA, as
agent (in such capacity, the "Agent") for the Banks under and as defined in the
Term Loan Agreement dated as of October _____, 2002 among the Company, the Banks
and the Agent (as amended or otherwise modified from time to time, the "Term
Loan Agreement"), or registered assigns, the principal sum of [INSERT AMOUNT OF
DEFERRED DRAW TERM LOAN] ($[_______]) or such lesser principal amount as shall
be equal to the aggregate principal amount of the Term Loans (as defined in the
Term Loan Agreement) included in the Obligations (as defined in the Term Loan
Agreement) outstanding on April 15, 2003 (the "Maturity Date"), but not in
excess, however, of the principal amount of this bond, and to pay interest
thereon at the Interest Rate (as defined below) until the principal hereof is
paid or duly made available for payment on the Maturity Date, or, in the event
of redemption of this bond, until the redemption date, or, in the event of
default in the payment of the principal hereof, until the Company's obligations
with respect to the payment of such principal shall be discharged as provided in
the Indenture (as defined on the reverse hereof). Interest on this bond shall be
payable on each Interest Payment Date (as defined below), commencing on the
first Interest Payment Date next succeeding [INSERT DATE OF THE SUPPLEMENTAL
INDENTURE], 2002. If the Maturity Date falls on a day which is not a Business
Day, as defined below, principal and any interest and/or fees payable with
respect to the Maturity Date will be paid on the immediately preceding Business
Day. The interest payable, and punctually paid or duly provided for, on any
Interest Payment Date will, subject to certain exceptions, be paid to the person
in whose name this bond (or one or more predecessor bonds) is registered at the
close of business on the Record Date (as defined below); provided, however, that
interest payable on the Maturity Date will be payable to the person to whom the
principal hereof shall be payable. Should the Company default in the payment of
interest ("Defaulted Interest"), the Defaulted Interest shall be paid to the
person in whose name this bond (or one or more predecessor bonds) is registered
on a subsequent record date fixed by the Company, which subsequent record date
shall be fifteen (15) days prior to the payment of such Defaulted Interest. As
used herein, (A) "Business Day" shall mean any day, other than a Saturday or
Sunday, on which banks generally are open in Chicago, Illinois and New York, New
York for the conduct of substantially all of their commercial lending activities
and on which interbank wire transfers can be made on the Fedwire system; (B)
"Interest Payment Date" shall mean each date on which interest and/or fees under
the Term Loan Agreement are due and payable from time to time pursuant to the
Term Loan Agreement; (C) "Interest Rate" shall mean
-3-
a rate of interest per annum, adjusted as necessary, to result in an interest
payment equal to the aggregate amount of interest and fees due under the Term
Loan Agreement on the applicable Interest Payment Date; and (D) "Record Date"
with respect to any Interest Payment Date shall mean the day (whether or not a
Business Day) immediately next preceding such Interest Payment Date.
Payment of the principal of and interest on this bond will be made in
immediately available funds at the office or agency of the Company maintained
for that purpose in the City of Jackson, Michigan, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.
The provisions of this bond are continued on the reverse hereof and
such continued provisions shall for all purposes have the same effect as though
fully set forth at this place.
This bond shall not be valid or become obligatory for any purpose
unless and until it shall have been authenticated by the execution by the
Trustee or its successor in trust under the Indenture of the certificate hereon.
IN WITNESS WHEREOF, Consumers Energy Company has caused this bond to be
executed in its name by its Chairman of the Board, its President or one of its
Vice Presidents by his or her signature or a facsimile thereof, and its
corporate seal or a facsimile thereof to be affixed hereto or imprinted hereon
and attested by its Secretary or one of its Assistant Secretaries by his or her
signature or a facsimile thereof.
CONSUMERS ENERGY COMPANY
Dated:
By:
----------------------------------
Printed:
-----------------------------
Title:
-------------------------------
Attest:
-------------------------
TRUSTEE'S AUTHENTICATION CERTIFICATE
This is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.
-4-
JPMORGAN CHASE BANK, Trustee
By
-------------------------
Authorized Officer
-5-
[REVERSE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND
COLLATERAL SERIES DUE 2003
This bond is one of the bonds of a series designated as First Mortgage
Bonds, Collateral Series due 2003 (sometimes herein referred to as the "2003
Collateral Series Bonds") issued under and in accordance with and secured by an
Indenture dated as of September 1, 1945, given by the Company (or its
predecessor, Consumers Power Company, a Maine corporation) to City Bank Farmers
Trust Company (JPMorgan Chase Bank, successor) (hereinafter sometimes referred
to as the "Trustee"), together with indentures supplemental thereto, heretofore
or hereafter executed, to which indenture and indentures supplemental thereto
(hereinafter referred to collectively as the "Indenture") reference is hereby
made for a description of the property mortgaged and pledged, the nature and
extent of the security and the rights, duties and immunities thereunder of the
Trustee and the rights of the holders of said bonds and of the Trustee and of
the Company in respect of such security, and the limitations on such rights. By
the terms of the Indenture, the bonds to be secured thereby are issuable in
series which may vary as to date, amount, date of maturity, rate of interest and
in other respects as provided in the Indenture.
The 2003 Collateral Series Bonds are to be issued and delivered to the
Agent in order evidence and secure the obligation of the Company under the Term
Loan Agreement to make payments to the Banks under the Term Loan Agreement and
to provide the Banks the benefit of the lien of the Indenture with respect to
the 2003 Collateral Series Bonds.
The obligation of the Company to make payments with respect to the
principal of 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with respect to the principal of the 2003
Collateral Series Bonds shall be deemed discharged in the same amount as the
payment with respect to the Term Loans discharges the outstanding obligation
with respect to such Term Loans.
The obligation of the Company to make payments with respect to the
interest on 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2003 Collateral Series
-6-
Bonds shall be deemed discharged in the same amount as the payment with respect
to the Term Loans discharges the outstanding obligation with respect to such
Term Loans.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on this bond, so far as such payments at the time have become due, has
been fully satisfied and discharged unless and until the Trustee shall have
received a written notice from the Agent stating (i) that timely payment of
principal and interest on the 2003 Collateral Series Bonds has not been made,
(ii) that the Company is in arrears as to the payments required to be made by it
to the Agent in connection with the Obligations pursuant to the Term Loan
Agreement, and (iii) the amount of the arrearage.
If an Event of Default (as defined in the Term Loan Agreement) with
respect to the payment of the principal of any Term Loans shall have occurred,
it shall be deemed to be a default for purposes of Section 11.01 of the
Indenture in the payment of the principal of the 2003 Collateral Series Bonds
equal to the amount of such unpaid principal (but in no event in excess of the
principal amount of the 2003 Collateral Series Bonds). If an Event of Default
(as defined in the Term Loan Agreement) with respect to the payment of interest
on any Term Loans or fees shall have occurred, it shall be deemed to be a
default for purposes of Section 11.01 of the Indenture in the payment of the
interest on the 2003 Collateral Series Bonds equal to the amount of such unpaid
interest or fees.
This bond is not redeemable except upon written demand of the Agent
following the occurrence of an Event of Default under the Term Loan Agreement
and the acceleration of the Obligations, as provided in Section 9.2 of the Term
Loan Agreement. This bond is not redeemable by the operation of the improvement
fund or the maintenance and replacement provisions of the Indenture or with the
proceeds of released property.
In case of certain defaults as specified in the Indenture, the
principal of this bond may be declared or may become due and payable on the
conditions, at the time, in the manner and with the effect provided in the
Indenture. The holders of certain specified percentages of the bonds at the time
outstanding, including in certain cases specified percentages of bonds of
particular series, may in certain cases, to the extent and as provided in the
Indenture, waive certain defaults thereunder and the consequences of such
defaults.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than seventy-five per
centum in principal amount of the bonds (exclusive of bonds disqualified by
reason of the Company's interest therein) at the time outstanding, including, if
more than one series of bonds shall be at the time outstanding, not less than
sixty per centum in principal amount of each series affected, to effect, by an
indenture supplemental to the Indenture, modifications or alterations of the
Indenture and of the rights and obligations of the Company and the rights of the
holders of the bonds and coupons; provided, however, that no such modification
or alteration shall be made without the written approval or consent of the
holder hereof which will (a) extend the maturity of this bond or reduce the rate
or extend the time of payment of interest hereon or reduce the amount of the
principal hereof, or (b) permit the creation of any lien, not otherwise
permitted, prior to or on a parity with the lien of the
-7-
Indenture, or (c) reduce the percentage of the principal amount of the bonds the
holders of which are required to approve any such supplemental indenture.
The Company reserves the right, without any consent, vote or other
action by holders of the 2003 Collateral Series Bonds or any other series
created after the Sixty-eighth Supplemental Indenture to amend the Indenture to
reduce the percentage of the principal amount of bonds the holders of which are
required to approve any supplemental indenture (other than any supplemental
indenture which is subject to the proviso contained in the immediately preceding
sentence) (a) from not less than seventy-five per centum (including sixty per
centum of each series affected) to not less than a majority in principal amount
of the bonds at the time outstanding or (b) in case fewer than all series are
affected, not less than a majority in principal amount of the bonds of all
affected series, voting together.
No recourse shall be had for the payment of the principal of or
interest on this bond, or for any claim based hereon, or otherwise in respect
hereof or of the Indenture, to or against any incorporator, stockholder,
director or officer, past, present or future, as such, of the Company, or of any
predecessor or successor company, either directly or through the Company, or
such predecessor or successor company, or otherwise, under any constitution or
statute or rule of law, or by the enforcement of any assessment or penalty, or
otherwise, all such liability of incorporators, stockholders, directors and
officers, as such, being waived and released by the holder and owner hereof by
the acceptance of this bond and being likewise waived and released by the terms
of the Indenture.
This bond shall be exchangeable for other registered bonds of the same
series, in the manner and upon the conditions prescribed in the Indenture, upon
the surrender of such bonds at the Investor Services Department of the Company,
as transfer agent. However, notwithstanding the provisions of Section 2.05 of
the Indenture, no charge shall be made upon any registration of transfer or
exchange of bonds of said series other than for any tax or taxes or other
governmental charge required to be paid by the Company.
The Agent shall surrender this bond to the Trustee when all of the
principal of and interest on the Term Loans arising under the Term Loan
Agreement, and all of the fees payable pursuant to the Term Loan Agreement,
shall have been duly paid, and the Term Loan Agreement shall have been
terminated.
[END OF FORM OF REGISTERED BOND OF THE 2003 COLLATERAL SERIES BONDS]
---------------
-8-
AND WHEREAS all acts and things necessary to make the 2003 Collateral
Series Bonds, when duly executed by the Company and authenticated by the Trustee
or its agent and issued as prescribed in the Indenture, as heretofore
supplemented and amended, and this Supplemental Indenture provided, the valid,
binding and legal obligations of the Company, and to constitute the Indenture,
as supplemented and amended as aforesaid, as well as by this Supplemental
Indenture, a valid, binding and legal instrument for the security thereof, have
been done and performed, and the creation, execution and delivery of this
Supplemental Indenture and the creation, execution and issuance of bonds subject
to the terms hereof and of the Indenture, as so supplemented and amended, have
in all respects been duly authorized;
NOW, THEREFORE, in consideration of the premises, of the acceptance and
purchase by the holders thereof of the bonds issued and to be issued under the
Indenture, as supplemented and amended as above set forth, and of the sum of One
Dollar duly paid by the Trustee to the Company, and of other good and valuable
considerations, the receipt whereof is hereby acknowledged, and for the purpose
of securing the due and punctual payment of the principal of and premium, if
any, and interest on all bonds now outstanding under the Indenture and the
$[INSERT AMOUNT OF DEFERRED DRAW TERM LOAN] principal amount of the 2003
Collateral Series Bonds proposed to be issued initially and all other bonds
which shall be issued under the Indenture, as supplemented and amended from time
to time, and for the purpose of securing the faithful performance and observance
of all covenants and conditions therein, and in any indenture supplemental
thereto, set forth, the Company has given, granted, bargained, sold, released,
transferred, assigned, hypothecated, pledged, mortgaged, confirmed, set over,
warranted, alienated and conveyed and by these presents does give, grant,
bargain, sell, release, transfer, assign, hypothecate, pledge, mortgage,
confirm, set over, warrant, alien and convey unto JPMorgan Chase Bank, as
Trustee, as provided in the Indenture, and its successor or successors in the
trust thereby and hereby created and to its or their assigns forever, all the
right, title and interest of the Company in and to all the property, described
in Section 11 hereof, together (subject to the provisions of Article X of the
Indenture) with the tolls, rents, revenues, issues, earnings, income, products
and profits thereof, excepting, however, the property, interests and rights
specifically excepted from the lien of the Indenture as set forth in the
Indenture;
TOGETHER WITH all and singular the tenements, hereditaments and
appurtenances belonging or in any wise appertaining to the premises, property,
franchises and rights, or any thereof, referred to in the foregoing granting
clause, with the reversion and reversions, remainder and remainders and (subject
to the provisions of Article X of the Indenture) the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, and all the estate,
right, title and interest and claim whatsoever, at law as well as in equity,
which the Company now has or may hereafter acquire in and to the aforesaid
premises, property, franchises and rights and every part and parcel thereof;
SUBJECT, HOWEVER, with respect to such premises, property, franchises
and rights, to excepted encumbrances as said term is defined in Section 1.02 of
the Indenture, and subject also to all defects and limitations of title and to
all encumbrances existing at the time of acquisition. TO HAVE AND TO HOLD all
said premises, property, franchises and rights hereby conveyed, assigned,
pledged or mortgaged, or intended so to be, unto the Trustee, its successor or
successors in trust and their assigns forever;
-9-
BUT IN TRUST, NEVERTHELESS, with power of sale for the equal and
proportionate benefit and security of the holders of all bonds now or hereafter
authenticated and delivered under and secured by the Indenture and interest
coupons appurtenant thereto, pursuant to the provisions of the Indenture and of
any supplemental indenture, and for the enforcement of the payment of said bonds
and coupons when payable and the performance of and compliance with the
covenants and conditions of the Indenture and of any supplemental indenture,
without any preference, distinction or priority as to lien or otherwise of any
bond or bonds over others by reason of the difference in time of the actual
authentication, delivery, issue, sale or negotiation thereof or for any other
reason whatsoever, except as otherwise expressly provided in the Indenture; and
so that each and every bond now or hereafter authenticated and delivered
thereunder shall have the same lien, and so that the principal of and premium,
if any, and interest on every such bond shall, subject to the terms thereof, be
equally and proportionately secured, as if it had been made, executed,
authenticated, delivered, sold and negotiated simultaneously with the execution
and delivery thereof;
AND IT IS EXPRESSLY DECLARED by the Company that all bonds
authenticated and delivered under and secured by the Indenture, as supplemented
and amended as above set forth, are to be issued, authenticated and delivered,
and all said premises, property, franchises and rights hereby and by the
Indenture and indentures supplemental thereto conveyed, assigned, pledged or
mortgaged, or intended so to be, are to be dealt with and disposed of under,
upon and subject to the terms, conditions, stipulations, covenants, agreements,
trusts, uses and purposes expressed in the Indenture, as supplemented and
amended as above set forth, and the parties hereto mutually agree as follows:
SECTION 1. There is hereby created one series of bonds (the "2003
Collateral Series Bonds") designated as hereinabove provided, which shall also
bear the descriptive title "First Mortgage Bond", and the form thereof shall be
substantially as hereinbefore set forth (the "Sample Bond"). The 2003 Collateral
Series Bonds shall be issued in the aggregate principal amount of $[INSERT
AMOUNT OF DEFERRED DRAW TERM LOAN], shall mature on April 15, 2003 and shall be
issued only as registered bonds without coupons in denominations of $1,000 and
any multiple thereof. The serial numbers of the 2003 Collateral Series Bonds
shall be such as may be approved by any officer of the Company, the execution
thereof by any such officer either manually or by facsimile signature to be
conclusive evidence of such approval. The 2003 Collateral Series Bonds are to be
issued to and registered in the name of the Agent under the Term Loan Agreement
(as such terms are defined in the Sample Bond) to evidence and secure any and
all Obligations (as such term is defined in the Term Loan Agreement) of the
Company under the Term Loan Agreement.
The 2003 Collateral Series Bonds shall bear interest as set forth in
the Sample Bond. The principal of and the interest on said bonds shall be
payable as set forth in the Sample Bond.
The obligation of the Company to make payments with respect to the
principal of 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with
-10-
respect to the principal of the 2003 Collateral Series Bonds shall be deemed
discharged in the same amount as the payment with respect to the Term Loans
discharges the outstanding obligation with respect to such Term Loans.
The obligation of the Company to make payments with respect to the
interest on 2003 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2003 Collateral Series Bonds shall be deemed discharged in the
same amount as the payment with respect to the Term Loans discharges the
outstanding obligation with respect to such Term Loans.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on the 2003 Collateral Series Bonds, so far as such payments at the
time have become due, has been fully satisfied and discharged unless and until
the Trustee shall have received a written notice from the Agent stating (i) that
timely payment of principal and interest on the 2003 Collateral Series Bonds has
not been made, (ii) that the Company is in arrears as to the payments required
to be made by it to the Agent pursuant to the Term Loan Agreement, and (iii) the
amount of the arrearage.
The 2003 Collateral Series Bonds shall be exchangeable for other
registered bonds of the same series, in the manner and upon the conditions
prescribed in the Indenture, upon the surrender of such bonds at the Investor
Services Department of the Company, as transfer agent. However, notwithstanding
the provisions of Section 2.05 of the Indenture, no charge shall be made upon
any registration of transfer or exchange of bonds of said series other than for
any tax or taxes or other governmental charge required to be paid by the
Company.
SECTION 2. The 2003 Collateral Series Bonds are not redeemable by the
operation of the maintenance and replacement provisions of this Indenture or
with the proceeds of released property.
SECTION 3. Upon the occurrence of an Event of Default under the Term
Loan Agreement and the acceleration of the Obligations, the 2003 Collateral
Series Bonds shall be redeemable in whole upon receipt by the Trustee of a
written demand from the Agent stating that there has occurred under the Term
Loan Agreement both an Event of Default and a declaration of acceleration of the
Obligations and demanding redemption of the 2003 Collateral Series Bonds
(including a description of the amount of principal, interest and fees which
comprise such Obligations). The Company waives any right it may have to prior
notice of such redemption under the Indenture. Upon surrender of the 2003
Collateral Series Bonds by the Agent to the Trustee, the 2003 Collateral Series
Bonds shall be redeemed at a redemption price equal to the aggregate amount of
the Obligations.
SECTION 4. The Company reserves the right, without any consent, vote or
other action by the holder of the 2003 Collateral Series Bonds or of any
subsequent series of bonds issued
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under the Indenture, to make such amendments to the Indenture, as supplemented,
as shall be necessary in order to amend Section 17.02 to read as follows:
SECTION 17.02. With the consent of the holders of not less
than a majority in principal amount of the bonds at the time
outstanding or their attorneys-in-fact duly authorized, or, if fewer
than all series are affected, not less than a majority in principal
amount of the bonds at the time outstanding of each series the rights
of the holders of which are affected, voting together, the Company,
when authorized by a resolution, and the Trustee may from time to time
and at any time enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or modifying the rights and obligations of the
Company and the rights of the holders of any of the bonds and coupons;
provided, however, that no such supplemental indenture shall (1) extend
the maturity of any of the bonds or reduce the rate or extend the time
of payment of interest thereon, or reduce the amount of the principal
thereof, or reduce any premium payable on the redemption thereof,
without the consent of the holder of each bond so affected, or (2)
permit the creation of any lien, not otherwise permitted, prior to or
on a parity with the lien of this Indenture, without the consent of the
holders of all the bonds then outstanding, or (3) reduce the aforesaid
percentage of the principal amount of bonds the holders of which are
required to approve any such supplemental indenture, without the
consent of the holders of all the bonds then outstanding. For the
purposes of this Section, bonds shall be deemed to be affected by a
supplemental indenture if such supplemental indenture adversely affects
or diminishes the rights of holders thereof against the Company or
against its property. The Trustee may in its discretion determine
whether or not, in accordance with the foregoing, bonds of any
particular series would be affected by any supplemental indenture and
any such determination shall be conclusive upon the holders of bonds of
such series and all other series. Subject to the provisions of Sections
16.02 and 16.03 hereof, the Trustee shall not be liable for any
determination made in good faith in connection herewith.
Upon the written request of the Company, accompanied by a
resolution authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the
consent of bondholders as aforesaid (the instrument or instruments
evidencing such consent to be dated within one year of such request),
the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion but shall
not be obligated to enter into such supplemental indenture.
It shall not be necessary for the consent of the bondholders
under this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such consent
shall approve the substance thereof.
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The Company and the Trustee, if they so elect, and either
before or after such consent has been obtained, may require the holder
of any bond consenting to the execution of any such supplemental
indenture to submit his bond to the Trustee or to ask such bank, banker
or trust company as may be designated by the Trustee for the purpose,
for the notation thereon of the fact that the holder of such bond has
consented to the execution of such supplemental indenture, and in such
case such notation, in form satisfactory to the Trustee, shall be made
upon all bonds so submitted, and such bonds bearing such notation shall
forthwith be returned to the persons entitled thereto.
Prior to the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the
Company shall publish a notice, setting forth in general terms the
substance of such supplemental indenture, at least once in one daily
newspaper of general circulation in each city in which the principal of
any of the bonds shall be payable, or, if all bonds outstanding shall
be registered bonds without coupons or coupon bonds registered as to
principal, such notice shall be sufficiently given if mailed, first
class, postage prepaid, and registered if the Company so elects, to
each registered holder of bonds at the last address of such holder
appearing on the registry books, such publication or mailing, as the
case may be, to be made not less than thirty days prior to such
execution. Any failure of the Company to give such notice, or any
defect therein, shall not, however, in any way impair or affect the
validity of any such supplemental indenture.
SECTION 5. As supplemented and amended as above set forth, the
Indenture is in all respects ratified and confirmed, and the Indenture and all
indentures supplemental thereto shall be read, taken and construed as one and
the same instrument.
SECTION 6. Nothing contained in this Supplemental Indenture shall, or
shall be construed to, confer upon any person other than a holder of bonds
issued under the Indenture, as supplemented and amended as above set forth, the
Company, the Trustee and the Agent, for the benefit of the Banks (as such term
is defined in the Term Loan Agreement), any right or interest to avail himself
of any benefit under any provision of the Indenture, as so supplemented and
amended.
SECTION 7. The Trustee assumes no responsibility for or in respect of
the validity or sufficiency of this Supplemental Indenture or of the Indenture
as hereby supplemented or the due execution hereof by the Company or for or in
respect of the recitals and statements contained herein (other than those
contained in the sixth, seventh and eighth recitals hereof), all of which
recitals and statements are made solely by the Company.
SECTION 8. This Supplemental Indenture may be simultaneously executed
in several counterparts and all such counterparts executed and delivered, each
as an original, shall constitute but one and the same instrument.
SECTION 9. In the event the date of any notice required or permitted
hereunder shall not be a Business Day, then (notwithstanding any other provision
of the Indenture or of any
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supplemental indenture thereto) such notice need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the date fixed for such notice. "Business Day" means, with respect
to this Section 9, any day, other than a Saturday or Sunday, on which banks
generally are open in Chicago, Illinois and New York, New York for the conduct
of substantially all of their commercial lending activities and on which
interbank wire transfers can be made on the Fedwire system.
SECTION 10. This Supplemental Indenture and the 2003 Collateral Series
Bonds shall be governed by and deemed to be a contract under, and construed in
accordance with, the laws of the State of Michigan, and for all purposes shall
be construed in accordance with the laws of such state, except as may otherwise
be required by mandatory provisions of law.
SECTION 11. Detailed Description of Property Mortgaged:
ARTICLE I:
ELECTRIC GENERATING PLANTS AND DAMS
All the electric generating plants and stations of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, including all powerhouses, buildings, reservoirs, dams,
pipelines, flumes, structures and works and the land on which the same are
situated and all water rights and all other lands and easements, rights of way,
permits, privileges, towers, poles, wires, machinery, equipment, appliances,
appurtenances and supplies and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with such
plants and stations or any of them, or adjacent thereto.
ARTICLE II:
ELECTRIC TRANSMISSION LINES
All the electric transmission lines of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including towers, poles, pole lines, wires, switches, switch racks,
switchboards, insulators and other appliances and equipment, and all other
property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such transmission lines or any of them or
adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises and rights for or relating to the construction,
maintenance or operation thereof, through, over, under or upon any private
property or any public streets or highways, within as well as without the
corporate limits of any municipal corporation. Also all the real property,
rights of way, easements, permits, privileges and rights for or relating to the
construction, maintenance or operation of certain transmission lines, the land
and rights for which are owned by the Company, which are either not built or now
being constructed.
-14-
ARTICLE III:
ELECTRIC DISTRIBUTION SYSTEMS
All the electric distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including substations, transformers, switchboards, towers, poles, wires,
insulators, subways, trenches, conduits, manholes, cables, meters and other
appliances and equipment, and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with such
distribution systems or any of them or adjacent thereto; together with all real
property, rights of way, easements, permits, privileges, franchises, grants and
rights, for or relating to the construction, maintenance or operation thereof,
through, over, under or upon any private property or any public streets or
highways within as well as without the corporate limits of any municipal
corporation.
ARTICLE IV:
ELECTRIC SUBSTATIONS, SWITCHING STATIONS AND SITES
All the substations, switching stations and sites of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, for transforming, regulating, converting or distributing or
otherwise controlling electric current at any of its plants and elsewhere,
together with all buildings, transformers, wires, insulators and other
appliances and equipment, and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with any
of such substations and switching stations, or adjacent thereto, with sites to
be used for such purposes.
ARTICLE V:
GAS COMPRESSOR STATIONS, GAS PROCESSING PLANTS,
DESULPHURIZATION STATIONS, METERING STATIONS, ODORIZING
STATIONS, REGULATORS AND SITES
All the compressor stations, processing plants, desulphurization
stations, metering stations, odorizing stations, regulators and sites of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
lien of the Indenture, for compressing, processing, desulphurizing, metering,
odorizing and regulating manufactured or natural gas at any of its plants and
elsewhere, together with all buildings, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with any of such
purposes, with sites to be used for such purposes.
-15-
ARTICLE VI:
GAS STORAGE FIELDS
The natural gas rights and interests of the Company, including wells
and well lines (but not including natural gas, oil and minerals), the gas
gathering system, the underground gas storage rights, the underground gas
storage wells and injection and withdrawal system used in connection therewith,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture: In the Overisel Gas Storage Field, located in the Township of
Overisel, Allegan County, and in the Township of Zeeland, Ottawa County,
Michigan; in the Northville Gas Storage Field located in the Township of Salem,
Washtenaw County, Township of Lyon, Oakland County, and the Townships of
Northville and Plymouth and City of Plymouth, Wayne County, Michigan; in the
Salem Gas Storage Field, located in the Township of Salem, Allegan County, and
in the Township of Jamestown, Ottawa County, Michigan; in the Ray Gas Storage
Field, located in the Townships of Ray and Armada, Macomb County, Michigan; in
the Lenox Gas Storage Field, located in the Townships of Lenox and Chesterfield,
Macomb County, Michigan; in the Ira Gas Storage Field, located in the Township
of Ira, St. Clair County, Michigan; in the Puttygut Gas Storage Field, located
in the Township of Casco, St. Clair County, Michigan; in the Four Corners Gas
Storage Field, located in the Townships of Casco, China, Cottrellville and Ira,
St. Clair County, Michigan; in the Swan Creek Gas Storage Field, located in the
Township of Casco and Ira, St. Clair County, Michigan; and in the Hessen Gas
Storage Field, located in the Townships of Casco and Columbus, St. Clair,
Michigan.
ARTICLE VII:
GAS TRANSMISSION LINES
All the gas transmission lines of the Company, constructed or otherwise
acquired by it and not heretofore described in the Indenture or any supplement
thereto and not heretofore released from the lien of the Indenture, including
gas mains, pipes, pipelines, gates, valves, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such
transmission lines or any of them or adjacent thereto; together with all real
property, right of way, easements, permits, privileges, franchises and rights
for or relating to the construction, maintenance or operation thereof, through,
over, under or upon any private property or any public streets or highways,
within as well as without the corporate limits of any municipal corporation.
ARTICLE VIII:
GAS DISTRIBUTION SYSTEMS
All the gas distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including tunnels, conduits, gas mains and pipes, service pipes, fittings,
gates, valves, connections, meters and other appliances and equipment, and all
other property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed
-16-
in connection with such distribution systems or any of them or adjacent thereto;
together with all real property, rights of way, easements, permits, privileges,
franchises, grants and rights, for or relating to the construction, maintenance
or operation thereof, through, over, under or upon any private property or any
public streets or highways within as well as without the corporate limits of any
municipal corporation.
ARTICLE IX:
OFFICE BUILDINGS, SERVICE BUILDINGS, GARAGES, ETC.
All office, garage, service and other buildings of the Company,
wherever located, in the State of Michigan, constructed or otherwise acquired by
it and not heretofore described in the Indenture or any supplement thereto and
not heretofore released from the lien of the Indenture, together with the land
on which the same are situated and all easements, rights of way and
appurtenances to said lands, together with all furniture and fixtures located in
said buildings.
ARTICLE X:
TELEPHONE PROPERTIES AND
RADIO COMMUNICATION EQUIPMENT
All telephone lines, switchboards, systems and equipment of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
lien of the Indenture, used or available for use in the operation of its
properties, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such telephone
properties or any of them or adjacent thereto; together with all real estate,
rights of way, easements, permits, privileges, franchises, property, devices or
rights related to the dispatch, transmission, reception or reproduction of
messages, communications, intelligence, signals, light, vision or sound by
electricity, wire or otherwise, including all telephone equipment installed in
buildings used as general and regional offices, substations and generating
stations and all telephone lines erected on towers and poles; and all radio
communication equipment of the Company, together with all property, real or
personal (except any in the Indenture expressly excepted), fixed stations,
towers, auxiliary radio buildings and equipment, and all appurtenances used in
connection therewith, wherever located, in the State of Michigan.
ARTICLE XI:
OTHER REAL PROPERTY
All other real property of the Company and all interests therein, of
every nature and description (except any in the Indenture expressly excepted)
wherever located, in the State of Michigan, acquired by it and not heretofore
described in the Indenture or any supplement thereto and not heretofore released
from the lien of the Indenture. Such real property includes but is not limited
to the following described property, such property is subject to any interests
that were excepted or reserved in the conveyance to the Company:
-17-
ALCONA COUNTY
Certain land in Caledonia Township, Alcona County, Michigan described
as:
The East 330 feet of the South 660 feet of the SW 1/4 of the
SW 1/4 of Section 8, T28N, R8E, except the West 264 feet of the South
330 feet thereof; said land being more particularly described as
follows: To find the place of beginning of this description, commence
at the Southwest corner of said section, run thence East along the
South line of said section 1243 feet to the place of beginning of this
description, thence continuing East along said South line of said
section 66 feet to the West 1/8 line of said section, thence N 02
degrees 09' 30" E along the said West 1/8 line of said section 660
feet, thence West 330 feet, thence S 02 degrees 09' 30" W, 330 feet,
thence East 264 feet, thence S 02 degrees 09' 30" W, 330 feet to the
place of beginning.
ALLEGAN COUNTY
Certain land in Lee Township, Allegan County, Michigan described as:
The NE 1/4 of the NW 1/4 of Section 16, T1N, R15W.
ALPENA COUNTY
Certain land in Wilson and Green Townships, Alpena County, Michigan
described as:
All that part of the S'ly 1/2 of the former Boyne City-Gaylord
and Alpena Railroad right of way, being the Southerly 50 feet of a 100
foot strip of land formerly occupied by said Railroad, running from the
East line of Section 31, T31N, R7E, Southwesterly across said Section
31 and Sections 5 and 6 of T30N, R7E and Sections 10, 11 and the E 1/2
of Section 9, except the West 1646 feet thereof, all in T30N, R6E.
ANTRIM COUNTY
Certain land in Mancelona Township, Antrim County, Michigan described
as:
The S 1/2 of the NE 1/4 of Section 33, T29N, R6W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the State of Michigan to August W. Schack and Emma H. Schack, his wife,
dated April 15, 1946 and recorded May 20, 1946 in Liber 97 of Deeds on
page 682 of Antrim County Records.
ARENAC COUNTY
Certain land in Standish Township, Arenac County, Michigan described
as:
-18-
A parcel of land in the SW 1/4 of the NW 1/4 of Section 12,
T18N, R4E, described as follows: To find the place of beginning of said
parcel of land, commence at the Northwest corner of Section 12, T18N,
R4E; run thence South along the West line of said section, said West
line of said section being also the center line of East City Limits
Road 2642.15 feet to the W 1/4 post of said section and the place of
beginning of said parcel of land; running thence N 88 degrees 26' 00" E
along the East and West 1/4 line of said section, 660.0 feet; thence
North parallel with the West line of said section, 310.0 feet; thence S
88 degrees 26' 00" W, 330.0 feet; thence South parallel with the West
line of said section, 260.0 feet; thence S 88 degrees 26' 00" W, 330.0
feet to the West line of said section and the center line of East City
Limits Road; thence South along the said West line of said section,
50.0 feet to the place of beginning.
BARRY COUNTY
Certain land in Johnstown Township, Barry County, Michigan described
as:
A strip of land 311 feet in width across the SW 1/4 of the NE
1/4 of Section 31, T1N, R8W, described as follows: To find the place of
beginning of this description, commence at the E 1/4 post of said
section; run thence N 00 degrees 55' 00" E along the East line of said
section, 555.84 feet; thence N 59 degrees 36' 20" W, 1375.64 feet;
thence N 88 degrees 30' 00" W, 130 feet to a point on the East 1/8 line
of said section and the place of beginning of this description; thence
continuing N 88 degrees 30' 00" W, 1327.46 feet to the North and South
1/4 line of said section; thence S 00 degrees 39'35" W along said North
and South 1/4 line of said section, 311.03 feet to a point, which said
point is 952.72 feet distant N'ly from the East and West 1/4 line of
said section as measured along said North and South 1/4 line of said
section; thence S 88 degrees 30' 00" E, 1326.76 feet to the East 1/8
line of said section; thence N 00 degrees 47' 20" E along said East 1/8
line of said section, 311.02 feet to the place of beginning.
BAY COUNTY
Certain land in Frankenlust Township, Bay County, Michigan described
as:
The South 250 feet of the N 1/2 of the W 1/2 of the W 1/2 of
the SE 1/4 of Section 9, T13N, R4E.
BENZIE COUNTY
Certain land in Benzonia Township, Benzie County, Michigan described
as:
A parcel of land in the Northeast 1/4 of Section 7, Township
26 North, Range 14 West, described as beginning at a point on the East
line of said Section 7, said point being 320 feet North measured along
the East line of said section from the East 1/4 post; running thence
West 165 feet; thence North parallel with
-19-
the East line of said section 165 feet; thence East 165 feet to the
East line of said section; thence South 165 feet to the place of
beginning.
BRANCH COUNTY
Certain land in Girard Township, Branch County, Michigan described as:
A parcel of land in the NE 1/4 of Section 23 T5S, R6W,
described as beginning at a point on the North and South quarter line
of said section at a point 1278.27 feet distant South of the North
quarter post of said section, said distance being measured along the
North and South quarter line of said section, running thence S89
degrees21'E 250 feet, thence North along a line parallel with the said
North and South quarter line of said section 200 feet, thence N89
degrees21'W 250 feet to the North and South quarter line of said
section, thence South along said North and South quarter line of said
section 200 feet to the place of beginning.
CALHOUN COUNTY
Certain land in Convis Township, Calhoun County, Michigan described as:
A parcel of land in the SE 1/4 of the SE 1/4 of Section 32,
T1S, R6W, described as follows: To find the place of beginning of this
description, commence at the Southeast corner of said section; run
thence North along the East line of said section 1034.32 feet to the
place of beginning of this description; running thence N 89 degrees 39'
52" W, 333.0 feet; thence North 290.0 feet to the South 1/8 line of
said section; thence S 89 degrees 39' 52" E along said South 1/8 line
of said section 333.0 feet to the East line of said section; thence
South along said East line of said section 290.0 feet to the place of
beginning. (Bearings are based on the East line of Section 32, T1S,
R6W, from the Southeast corner of said section to the Northeast corner
of said section assumed as North.)
CASS COUNTY
Certain easement rights located across land in Marcellus Township, Cass
County, Michigan described as:
The East 6 rods of the SW 1/4 of the SE 1/4 of Section 4, T5S,
R13W.
CHARLEVOIX COUNTY
Certain land in South Arm Township, Charlevoix County, Michigan
described as:
A parcel of land in the SW 1/4 of Section 29, T32N, R7W,
described as follows: Beginning at the Southwest corner of said section
and running thence North along the West line of said section 788.25
feet to a point which is 528 feet distant South of the South 1/8 line
of said section as measured along the said West
-20-
line of said section; thence N 89 degrees 30' 19" E, parallel with said
South 1/8 line of said section 442.1 feet; thence South 788.15 feet to
the South line of said section; thence S 89 degrees 29' 30" W, along
said South line of said section 442.1 feet to the place of beginning.
CHEBOYGAN COUNTY
Certain land in Inverness Township, Cheboygan County, Michigan
described as:
A parcel of land in the SW frl 1/4 of Section 31, T37N, R2W,
described as beginning at the Northwest corner of the SW frl 1/4,
running thence East on the East and West quarter line of said Section,
40 rods, thence South parallel to the West line of said Section 40
rods, thence West 40 rods to the West line of said Section, thence
North 40 rods to the place of beginning.
CLARE COUNTY
Certain land in Frost Township, Clare County, Michigan described as:
The East 150 feet of the North 225 feet of the NW 1/4 of the
NW 1/4 of Section 15, T20N, R4W.
CLINTON COUNTY
Certain land in Watertown Township, Clinton County, Michigan described
as:
The NE 1/4 of the NE 1/4 of the SE 1/4 of Section 22, and the
North 165 feet of the NW 1/4 of the NE 1/4 of the SE 1/4 of Section 22,
T5N, R3W.
CRAWFORD COUNTY
Certain land in Lovells Township, Crawford County, Michigan described
as:
A parcel of land in Section 1, T28N, R1W, described as:
Commencing at NW corner said section; thence South 89 degrees53'30"
East along North section line 105.78 feet to point of beginning; thence
South 89 degrees53'30" East along North section line 649.64 feet;
thence South 55 degrees 42'30" East 340.24 feet; thence South 55
degrees 44' 37" East 5,061.81 feet to the East section line; thence
South 00 degrees 00' 08" West along East section line 441.59 feet;
thence North 55 degrees 44' 37" West 5,310.48 feet; thence North 55
degrees 42'30" West 877.76 feet to point of beginning.
EATON COUNTY
Certain land in Eaton Township, Eaton County, Michigan described as:
A parcel of land in the SW 1/4 of Section 6, T2N, R4W,
described as follows: To find the place of beginning of this
description commence at the
-21-
Southwest corner of said section; run thence N 89 degrees 51' 30" E
along the South line of said section 400 feet to the place of beginning
of this description; thence continuing N 89 degrees 51' 30" E, 500
feet; thence N 00 degrees 50' 00" W, 600 feet; thence S 89 degrees 51'
30" W parallel with the South line of said section 500 feet; thence S
00 degrees 50' 00" E, 600 feet to the place of beginning.
EMMET COUNTY
Certain land in Wawatam Township, Emmet County, Michigan described as:
The West 1/2 of the Northeast 1/4 of the Northeast 1/4 of
Section 23, T39N, R4W.
GENESEE COUNTY
Certain land in Argentine Township, Genesee County, Michigan described
as:
A parcel of land of part of the SW 1/4 of Section 8, T5N, R5E,
being more particularly described as follows:
Beginning at a point of the West line of Duffield Road, 100
feet wide, (as now established) distant 829.46 feet measured N01
degrees42'56"W and 50 feet measured S88 degrees14'04"W` from the South
quarter corner, Section 8, T5N, R5E; thence S88 degrees14'04"W a
distance of 550 feet; thence N01 degrees42'56"W a distance of 500 feet
to a point on the North line of the South half of the Southwest quarter
of said Section 8; thence N88 degrees14'04"E along the North line of
South half of the Southwest quarter of said Section 8 a distance 550
feet to a point on the West line of Duffield Road, 100 feet wide (as
now established); thence S01 degrees42'56"E along the West line of said
Duffield Road a distance of 500 feet to the point of beginning.
GLADWIN COUNTY
Certain land in Secord Township, Gladwin County, Michigan described as:
The East 400 feet of the South 450 feet of Section 2, T19N,
R1E.
GRAND TRAVERSE COUNTY
Certain land in Mayfield Township, Grand Traverse County, Michigan
described as:
A parcel of land in the Northwest 1/4 of Section 3, T25N,
R11W, described as follows: Commencing at the Northwest corner of said
section, running thence S 89 degrees19'15" E along the North line of
said section and the center line of Clouss Road 225 feet, thence South
400 feet, thence N 89 degrees19'15" W 225 feet to the West line of said
section and the center line of
-22-
Hannah Road, thence North along the West line of said section and the
center line of Hannah Road 400 feet to the place of beginning for this
description.
GRATIOT COUNTY
Certain land in Fulton Township, Gratiot County, Michigan described as:
A parcel of land in the NE 1/4 of Section 7, Township 9 North,
Range 3 West, described as beginning at a point on the North line of
George Street in the Village of Middleton, which is 542 feet East of
the North and South one-quarter (1/4) line of said Section 7; thence
North 100 feet; thence East 100 feet; thence South 100 feet to the
North line of George Street; thence West along the North line of George
Street 100 feet to place of beginning.
HILLSDALE COUNTY
Certain land in Litchfield Village, Hillsdale County, Michigan
described as:
Lot 238 of Block three (3) of Assessors Plat of the Village of
Litchfield.
HURON COUNTY
Certain easement rights located across land in Sebewaing Township,
Huron County, Michigan described as:
The North 1/2 of the Northwest 1/4 of Section 15, T15N, R9E.
INGHAM COUNTY
Certain land in Vevay Township, Ingham County, Michigan described as:
A parcel of land 660 feet wide in the Southwest 1/4 of Section
7 lying South of the centerline of Sitts Road as extended to the
North-South 1/4 line of said Section 7, T2N, R1W, more particularly
described as follows: Commence at the Southwest corner of said Section
7, thence North along the West line of said Section 2502.71 feet to the
centerline of Sitts Road; thence South 89 degrees54'45" East along said
centerline 2282.38 feet to the place of beginning of this description;
thence continuing South 89 degrees54'45" East along said centerline and
said centerline extended 660.00 feet to the North-South 1/4 line of
said section; thence South 00 degrees07'20" West 1461.71 feet; thence
North 89 degrees34'58" West 660.00 feet; thence North 00 degrees07'20"
East 1457.91 feet to the centerline of Sitts Road and the place of
beginning.
IONIA COUNTY
Certain land in Sebewa Township, Ionia County, Michigan described as:
-23-
A strip of land 280 feet wide across that part of the SW 1/4
of the NE 1/4 of Section 15, T5N, R6W, described as follows:
To find the place of beginning of this description commence at
the E 1/4 corner of said section; run thence N 00 degrees 05' 38" W
along the East line of said section, 1218.43 feet; thence S 67 degrees
18' 24" W, 1424.45 feet to the East 1/8 line of said section and the
place of beginning of this description; thence continuing S 67 degrees
18' 24" W, 1426.28 feet to the North and South 1/4 line of said section
at a point which said point is 105.82 feet distant N'ly of the center
of said section as measured along said North and South 1/4 line of said
section; thence N 00 degrees 04' 47" E along said North and South 1/4
line of said section, 303.67 feet; thence N 67 degrees 18' 24" E,
1425.78 feet to the East 1/8 line of said section; thence S 00 degrees
00' 26" E along said East 1/8 line of said section, 303.48 feet to the
place of beginning. (Bearings are based on the East line of Section 15,
T5N, R6W, from the E 1/4 corner of said section to the Northeast corner
of said section assumed as N 00 degrees 05' 38" W.)
IOSCO COUNTY
Certain land in Alabaster Township, Iosco County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 34, T21N, R7E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence
South along the North and South 1/4 line of said section, 1354.40 feet
to the place of beginning of this description; thence continuing South
along the said North and South 1/4 line of said section, 165.00 feet to
a point on the said North and South 1/4 line of said section which said
point is 1089.00 feet distant North of the center of said section;
thence West 440.00 feet; thence North 165.00 feet; thence East 440.00
feet to the said North and South 1/4 line of said section and the place
of beginning.
ISABELLA COUNTY
Certain land in Chippewa Township, Isabella County, Michigan described
as:
The North 8 rods of the NE 1/4 of the SE 1/4 of Section 29,
T14N, R3W.
JACKSON COUNTY
Certain land in Waterloo Township, Jackson County, Michigan described
as:
A parcel of land in the North fractional part of the N
fractional 1/2 of Section 2, T1S, R2E, described as follows: To find
the place of beginning of this description commence at the E 1/4 post
of said section; run thence N 01 degrees 03' 40" E along the East line
of said section 1335.45 feet to the North 1/8 line of said section and
the place of beginning of this description; thence N 89 degrees 32' 00"
W, 2677.7 feet to the North and South 1/4 line of said section; thence
S 00 degrees 59' 25" W along the North and South 1/4 line of said
section 22.38
-24-
feet to the North 1/8 line of said section; thence S 89 degrees 59' 10"
W along the North 1/8 line of said section 2339.4 feet to the center
line of State Trunkline Highway M-52; thence N 53 degrees 46' 00" W
along the center line of said State Trunkline Highway 414.22 feet to
the West line of said section; thence N 00 degrees 55' 10" E along the
West line of said section 74.35 feet; thence S 89 degrees 32' 00" E,
5356.02 feet to the East line of said section; thence S 01 degrees 03'
40" W along the East line of said section 250 feet to the place of
beginning.
KALAMAZOO COUNTY
Certain land in Alamo Township, Kalamazoo County, Michigan described
as:
The South 350 feet of the NW 1/4 of the NW 1/4 of Section 16,
T1S, R12W, being more particularly described as follows: To find the
place of beginning of this description, commence at the Northwest
corner of said section; run thence S 00 degrees 36' 55" W along the
West line of said section 971.02 feet to the place of beginning of this
description; thence continuing S 00 degrees 36' 55" W along said West
line of said section 350.18 feet to the North 1/8 line of said section;
thence S 87 degrees 33' 40" E along the said North 1/8 line of said
section 1325.1 feet to the West 1/8 line of said section; thence N 00
degrees 38' 25" E along the said West 1/8 line of said section 350.17
feet; thence N 87 degrees 33' 40" W, 1325.25 feet to the place of
beginning.
KALKASKA COUNTY
Certain land in Kalkaska Township, Kalkaska County, Michigan described
as:
The NW 1/4 of the SW 1/4 of Section 4, T27N, R7W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the Department of Conservation for the State of Michigan to George
Welker and Mary Welker, his wife, dated October 9, 1934 and recorded
December 28, 1934 in Liber 39 on page 291 of Kalkaska County Records,
and subject to easement for pipeline purposes as granted to Michigan
Consolidated Gas Company by first party herein on April 4, 1963 and
recorded June 21, 1963 in Liber 91 on page 631 of Kalkaska County
Records.
KENT COUNTY
Certain land in Caledonia Township, Kent County, Michigan described as:
A parcel of land in the Northwest fractional 1/4 of Section
15, T5N, R10W, described as follows: To find the place of beginning of
this description commence at the North 1/4 corner of said section, run
thence S 0 degrees 59' 26" E along the North and South 1/4 line of said
section 2046.25 feet to the place of beginning of this description,
thence continuing S 0 degrees 59' 26" E along said North and South 1/4
line of said section 332.88 feet, thence S 88 degrees 58' 30"
-25-
W 2510.90 feet to a point herein designated "Point A" on the East bank
of the Thornapple River, thence continuing S 88 degrees 53' 30" W to
the center thread of the Thornapple River, thence NW'ly along the
center thread of said Thornapple River to a point which said point is S
88 degrees 58' 30" W of a point on the East bank of the Thornapple
River herein designated "Point B", said "Point B" being N 23 degrees
41' 35" W 360.75 feet from said above-described "Point A", thence N 88
degrees 58' 30" E to said "Point B", thence continuing N 88 degrees 58'
30" E 2650.13 feet to the place of beginning. (Bearings are based on
the East line of Section 15, T5N, R10W between the East 1/4 corner of
said section and the Northeast corner of said section assumed as N 0
degrees 59' 55" W.)
LAKE COUNTY
Certain land in Pinora and Cherry Valley Townships, Lake County,
Michigan described as:
A strip of land 50 feet wide East and West along and adjoining
the West line of highway on the East side of the North 1/2 of Section
13 T18N, R12W. Also a strip of land 100 feet wide East and West along
and adjoining the East line of the highway on the West side of
following described land: The South 1/2 of NW 1/4, and the South 1/2 of
the NW 1/4 of the SW 1/4, all in Section 6, T18N, R11W.
LAPEER COUNTY
Certain land in Hadley Township, Lapeer County, Michigan described as:
The South 825 feet of the W 1/2 of the SW 1/4 of Section 24,
T6N, R9E, except the West 1064 feet thereof.
LEELANAU COUNTY
Certain land in Cleveland Township, Leelanau County, Michigan described
as:
The North 200 feet of the West 180 feet of the SW 1/4 of the
SE 1/4 of Section 35, T29N, R13W.
LENAWEE COUNTY
Certain land in Madison Township, Lenawee County, Michigan described
as:
A strip of land 165 feet wide off the West side of the
following described premises: The E 1/2 of the SE 1/4 of Section 12.
The E 1/2 of the NE 1/4 and the NE 1/4 of the SE 1/4 of Section 13,
being all in T7S, R3E, excepting therefrom a parcel of land in the E
1/2 of the SE 1/4 of Section 12, T7S, R3E, beginning at the Northwest
corner of said E 1/2 of the SE 1/4 of Section 12, running thence East 4
rods, thence South 6 rods, thence West 4 rods, thence North 6 rods to
the place of beginning.
-26-
LIVINGSTON COUNTY
Certain land in Cohoctah Township, Livingston County, Michigan
described as:
Parcel 1
The East 390 feet of the East 50 rods of the SW 1/4 of Section
30, T4N, R4E.
Parcel 2
A parcel of land in the NW 1/4 of Section 31, T4N, R4E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence N 89
degrees 13' 06" W along the North line of said section, 330 feet to the
place of beginning of this description; running thence S 00 degrees 52'
49" W, 2167.87 feet; thence N 88 degrees 59' 49" W, 60 feet; thence N
00 degrees 52' 49" E, 2167.66 feet to the North line of said section;
thence S 89 degrees 13' 06" E along said North line of said section, 60
feet to the place of beginning.
MACOMB COUNTY
Certain land in Macomb Township, Macomb County, Michigan described as:
A parcel of land commencing on the West line of the E 1/2 of
the NW 1/4 of fractional Section 6, 20 chains South of the NW corner of
said E 1/2 of the NW 1/4 of Section 6; thence South on said West line
and the East line of A. Henry Kotner's Hayes Road Subdivision #15,
according to the recorded plat thereof, as recorded in Liber 24 of
Plats, on page 7, 24.36 chains to the East and West 1/4 line of said
Section 6; thence East on said East and West 1/4 line 8.93 chains;
thence North parallel with the said West line of the E 1/2 of the NW
1/4 of Section 6, 24.36 chains; thence West 8.93 chains to the place of
beginning, all in T3N, R13E.
MANISTEE COUNTY
Certain land in Manistee Township, Manistee County, Michigan described
as:
A parcel of land in the SW 1/4 of Section 20, T22N, R16W,
described as follows: To find the place of beginning of this
description, commence at the Southwest corner of said section; run
thence East along the South line of said section 832.2 feet to the
place of beginning of this description; thence continuing East along
said South line of said section 132 feet; thence North 198 feet; thence
West 132 feet; thence South 198 feet to the place of beginning,
excepting therefrom the South 2 rods thereof which was conveyed to
Manistee Township for highway purposes by a Quitclaim Deed dated June
13, 1919 and recorded July 11, 1919 in Liber 88 of Deeds on page 638 of
Manistee County Records.
-27-
MASON COUNTY
Certain land in Riverton Township, Mason County, Michigan described as:
Parcel 1
The South 10 acres of the West 20 acres of the S 1/2 of the NE
1/4 of Section 22, T17N, R17W.
Parcel 2
A parcel of land containing 4 acres of the West side of
highway, said parcel of land being described as commencing 16 rods
South of the Northwest corner of the NW 1/4 of the SW 1/4 of Section
22, T17N, R17W, running thence South 64 rods, thence NE'ly and N'ly and
NW'ly along the W'ly line of said highway to the place of beginning,
together with any and all right, title, and interest of Howard C.
Wicklund and Katherine E. Wicklund in and to that portion of the
hereinbefore mentioned highway lying adjacent to the E'ly line of said
above described land.
MECOSTA COUNTY
Certain land in Wheatland Township, Mecosta County, Michigan described
as:
A parcel of land in the SW 1/4 of the SW 1/4 of Section 16,
T14N, R7W, described as beginning at the Southwest corner of said
section; thence East along the South line of Section 133 feet; thence
North parallel to the West section line 133 feet; thence West 133 feet
to the West line of said Section; thence South 133 feet to the place of
beginning.
MIDLAND COUNTY
Certain land in Ingersoll Township, Midland County, Michigan described
as:
The West 200 feet of the W 1/2 of the NE 1/4 of Section 4,
T13N, R2E.
MISSAUKEE COUNTY
Certain land in Norwich Township, Missaukee County, Michigan described
as:
A parcel of land in the NW 1/4 of the NW 1/4 of Section 16,
T24N, R6W, described as follows: Commencing at the Northwest corner of
said section, running thence N 89 degrees 01' 45" E along the North
line of said section 233.00 feet; thence South 233.00 feet; thence S 89
degrees 01' 45" W, 233.00 feet to the West line of said section; thence
North along said West line of said section 233.00 feet to the place of
beginning. (Bearings are based on the West line of Section 16, T24N,
R6W, between the Southwest and Northwest corners of said section
assumed as North.)
-28-
MONROE COUNTY
Certain land in Whiteford Township, Monroe County, Michigan described
as:
A parcel of land in the SW1/4 of Section 20, T8S, R6E,
described as follows: To find the place of beginning of this
description commence at the S 1/4 post of said section; run thence West
along the South line of said section 1269.89 feet to the place of
beginning of this description; thence continuing West along said South
line of said section 100 feet; thence N 00 degrees 50' 35" E, 250 feet;
thence East 100 feet; thence S 00 degrees 50' 35" W parallel with and
16.5 feet distant W'ly of as measured perpendicular to the West 1/8
line of said section, as occupied, a distance of 250 feet to the place
of beginning.
MONTCALM COUNTY
Certain land in Crystal Township, Montcalm County, Michigan described
as:
The N 1/2 of the S 1/2 of the SE 1/4 of Section 35, T10N, R5W.
MONTMORENCY COUNTY
Certain land in the Village of Hillman, Montmorency County, Michigan
described as:
Lot 14 of Hillman Industrial Park, being a subdivision in the
South 1/2 of the Northwest 1/4 of Section 24, T31N, R4E, according to
the plat thereof recorded in Liber 4 of Plats on Pages 32-34,
Montmorency County Records.
MUSKEGON COUNTY
Certain land in Casnovia Township, Muskegon County, Michigan described
as:
The West 433 feet of the North 180 feet of the South 425 feet
of the SW 1/4 of Section 3, T10N, R13W.
NEWAYGO COUNTY
Certain land in Ashland Township, Newaygo County, Michigan described
as:
The West 250 feet of the NE 1/4 of Section 23, T11N, R13W.
OAKLAND COUNTY
Certain land in Wixcom City, Oakland County, Michigan described as:
The E 75 feet of the N 160 feet of the N 330 feet of the W
526.84 feet of the NW 1/4 of the NW 1/4 of Section 8, T1N, R8E, more
particularly described as follows: Commence at the NW corner of said
Section 8, thence N 87 degrees 14' 29" E along the North line of said
Section 8 a distance of 451.84 feet to the place
-29-
of beginning for this description; thence continuing N 87 degrees 14'
29" E along said North section line a distance of 75.0 feet to the East
line of the West 526.84 feet of the NW 1/4 of the NW 1/4 of said
Section 8; thence S 02 degrees 37' 09" E along said East line a
distance of 160.0 feet; thence S 87 degrees 14' 29" W a distance of
75.0 feet; thence N 02 degrees 37' 09" W a distance of 160.0 feet to
the place of beginning.
OCEANA COUNTY
Certain land in Crystal Township, Oceana County, Michigan described as:
The East 290 feet of the SE 1/4 of the NW 1/4 and the East 290
feet of the NE 1/4 of the SW 1/4, all in Section 20, T16N, R16W.
OGEMAW COUNTY
Certain land in West Branch Township, Ogemaw County, Michigan described
as:
The South 660 feet of the East 660 feet of the NE 1/4 of the
NE 1/4 of Section 33, T22N, R2E.
OSCEOLA COUNTY
Certain land in Hersey Township, Osceola County, Michigan described as:
A parcel of land in the North 1/2 of the Northeast 1/4 of
Section 13, T17N, R9W, described as commencing at the Northeast corner
of said Section; thence West along the North Section line 999 feet to
the point of beginning of this description; thence S 01 degrees 54' 20"
E 1327.12 feet to the North 1/8 line; thence S 89 degrees 17' 05" W
along the North 1/8 line 330.89 feet; thence N 01 degrees 54' 20" W
1331.26 feet to the North Section line; thence East along the North
Section line 331 feet to the point of beginning.
OSCODA COUNTY
Certain land in Comins Township, Oscoda County, Michigan described as:
The East 400 feet of the South 580 feet of the W 1/2 of the SW
1/4 of Section 15, T27N, R3E.
OTSEGO COUNTY
Certain land in Corwith Township, Otsego County, Michigan described as:
Part of the NW 1/4 of the NE 1/4 of Section 28, T32N, R3W,
described as: Beginning at the N 1/4 corner of said section; running
thence S 89 degrees 04' 06" E along the North line of said section,
330.00 feet; thence S 00 degrees 28' 43" E, 400.00 feet; thence N 89
degrees 04' 06" W, 330.00 feet to the North and
-30-
South 1/4 line of said section; thence N 00 degrees 28' 43" W along the
said North and South 1/4 line of said section, 400.00 feet to the point
of beginning; subject to the use of the N'ly 33.00 feet thereof for
highway purposes.
OTTAWA COUNTY
Certain land in Robinson Township, Ottawa County, Michigan described
as:
The North 660 feet of the West 660 feet of the NE 1/4 of the
NW 1/4 of Section 26, T7N, R15W.
PRESQUE ISLE COUNTY
Certain land in Belknap and Pulawski Townships, Presque Isle County,
Michigan described as:
Part of the South half of the Northeast quarter, Section 24,
T34N, R5E, and part of the Northwest quarter, Section 19, T34N, R6E,
more fully described as: Commencing at the East 1/4 corner of said
Section 24; thence N 00 degrees15'47" E, 507.42 feet, along the East
line of said Section 24 to the point of beginning; thence S 88
degrees15'36" W, 400.00 feet, parallel with the North 1/8 line of said
Section 24; thence N 00 degrees15'47" E, 800.00 feet, parallel with
said East line of Section 24; thence N 88 degrees15'36"E, 800.00 feet,
along said North 1/8 line of Section 24 and said line extended; thence
S 00 degrees15'47" W, 800.00 feet, parallel with said East line of
Section 24; thence S 88 degrees15'36" W, 400.00 feet, parallel with
said North 1/8 line of Section 24 to the point of beginning.
Together with a 33 foot easement along the West 33 feet of the
Northwest quarter lying North of the North 1/8 line of Section 24,
Belknap Township, extended, in Section 19, T34N, R6E.
ROSCOMMON COUNTY
Certain land in Gerrish Township, Roscommon County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 19, T24N, R3W,
described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section, run
thence East along the North line of said section 1,163.2 feet to the
place of beginning of this description (said point also being the place
of intersection of the West 1/8 line of said section with the North
line of said section), thence S 01 degrees 01' E along said West 1/8
line 132 feet, thence West parallel with the North line of said section
132 feet, thence N 01 degrees 01' W parallel with said West 1/8 line of
said section 132 feet to the North line of said section, thence East
along the North line of said section 132 feet to the place of
beginning.
-31-
SAGINAW COUNTY
Certain land in Chapin Township, Saginaw County, Michigan described as:
A parcel of land in the SW 1/4 of Section 13, T9N, R1E,
described as follows: To find the place of beginning of this
description commence at the Southwest corner of said section; run
thence North along the West line of said section 1581.4 feet to the
place of beginning of this description; thence continuing North along
said West line of said section 230 feet to the center line of a creek;
thence S 70 degrees 07' 00" E along said center line of said creek
196.78 feet; thence South 163.13 feet; thence West 185 feet to the West
line of said section and the place of beginning.
SANILAC COUNTY
Certain easement rights located across land in Minden Township, Sanilac
County, Michigan described as:
The Southeast 1/4 of the Southeast 1/4 of Section 1, T14N,
R14E, excepting therefrom the South 83 feet of the East 83 feet
thereof.
SHIAWASSEE COUNTY
Certain land in Burns Township, Shiawassee County, Michigan described
as:
The South 330 feet of the E 1/2 of the NE 1/4 of Section 36,
T5N, R4E.
ST. CLAIR COUNTY
Certain land in Ira Township, St. Clair County, Michigan described as:
The N 1/2 of the NW 1/4 of the NE 1/4 of Section 6, T3N, R15E.
ST. JOSEPH COUNTY
Certain land in Mendon Township, St. Joseph County, Michigan described
as:
The North 660 feet of the West 660 feet of the NW 1/4 of SW
1/4, Section 35, T5S, R10W.
TUSCOLA COUNTY
Certain land in Millington Township, Tuscola County, Michigan described
as:
A strip of land 280 feet wide across the East 96 rods of the
South 20 rods of the N 1/2 of the SE 1/4 of Section 34, T10N, R8E, more
particularly described as commencing at the Northeast corner of Section
3, T9N, R8E, thence S 89 degrees 55' 35" W along the South line of said
Section 34 a distance of 329.65 feet, thence N 18 degrees 11' 50" W a
distance of 1398.67 feet to the South 1/8
-32-
line of said Section 34 and the place of beginning for this
description; thence continuing N 18 degrees 11' 50" W a distance of
349.91 feet; thence N 89 degrees 57' 01" W a distance of 294.80 feet;
thence S 18 degrees 11' 50" E a distance of 350.04 feet to the South
1/8 line of said Section 34; thence S 89 degrees 58' 29" E along the
South 1/8 line of said section a distance of 294.76 feet to the place
of beginning.
VAN BUREN COUNTY
Certain land in Covert Township, Van Buren County, Michigan described
as:
All that part of the West 20 acres of the N 1/2 of the NE
fractional 1/4 of Section 1, T2S, R17W, except the West 17 rods of the
North 80 rods, being more particularly described as follows: To find
the place of beginning of this description commence at the N 1/4 post
of said section; run thence N 89 degrees 29' 20" E along the North line
of said section 280.5 feet to the place of beginning of this
description; thence continuing N 89 degrees 29' 20" E along said North
line of said section 288.29 feet; thence S 00 degrees 44' 00" E,
1531.92 feet; thence S 89 degrees 33' 30" W, 568.79 feet to the North
and South 1/4 line of said section; thence N 00 degrees 44' 00" W along
said North and South 1/4 line of said section 211.4 feet; thence N 89
degrees 29' 20" E, 280.5 feet; thence N 00 degrees 44' 00" W, 1320 feet
to the North line of said section and the place of beginning.
WASHTENAW COUNTY
Certain land in Manchester Township, Washtenaw County, Michigan
described as:
A parcel of land in the NE 1/4 of the NW 1/4 of Section 1,
T4S, R3E, described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section; run
thence East along the North line of said section 1355.07 feet to the
West 1/8 line of said section; thence S 00 degrees 22' 20" E along said
West 1/8 line of said section 927.66 feet to the place of beginning of
this description; thence continuing S 00 degrees 22' 20" E along said
West 1/8 line of said section 660 feet to the North 1/8 line of said
section; thence N 86 degrees 36' 57" E along said North 1/8 line of
said section 660.91 feet; thence N 00 degrees22' 20" W, 660 feet;
thence S 86 degrees 36' 57" W, 660.91 feet to the place of beginning.
WAYNE COUNTY
Certain land in Livonia City, Wayne County, Michigan described as:
Commencing at the Southeast corner of Section 6, T1S, R9E;
thence North along the East line of Section 6 a distance of 253 feet to
the point of beginning; thence continuing North along the East line of
Section 6 a distance of 50 feet; thence Westerly parallel to the South
line of Section 6, a distance of 215 feet; thence Southerly parallel to
the East line of Section 6 a distance of 50 feet;
-33-
thence easterly parallel with the South line of Section 6 a distance of
215 feet to the point of beginning.
WEXFORD COUNTY
Certain land in Selma Township, Wexford County, Michigan described as:
A parcel of land in the NW 1/4 of Section 7, T22N, R10W,
described as beginning on the North line of said section at a point 200
feet East of the West line of said section, running thence East along
said North section line 450 feet, thence South parallel with said West
section line 350 feet, thence West parallel with said North section
line 450 feet, thence North parallel with said West section line 350
feet to the place of beginning.
SECTION 12. The Company is a transmitting utility under Section 9401(5)
of the Michigan Uniform Commercial Code (M.C.L. 440.9401(5)) as defined in
M.C.L. 440.9105(n).
IN WITNESS WHEREOF, said Consumers Energy Company has caused this
Supplemental Indenture to be executed in its corporate name by its Chairman of
the Board, President, a Vice President or its Treasurer and its corporate seal
to be hereunto affixed and to be attested by its Secretary or an Assistant
Secretary, and said JPMorgan Chase Bank, as Trustee as aforesaid, to evidence
its acceptance hereof, has caused this Supplemental Indenture to be executed in
its corporate name by a Vice President and its corporate seal to be hereunto
affixed and to be attested by a Trust Officer, in several counterparts, all as
of the day and year first above written.
-34-
CONSUMERS ENERGY COMPANY
(SEAL) By
----------------------------
Laura L. Mountcastle
Attest: Vice President and Treasurer
- ----------------------------
Don A. Forsblom
Assistant Secretary
Signed, sealed and delivered
by CONSUMERS ENERGY COMPANY
in the presence of
- ----------------------------
Kimberly C. Wilson
- ----------------------------
Sammie B. Dalton
STATE OF MICHIGAN )
ss.
COUNTY OF JACKSON )
The foregoing instrument was acknowledged before me this ___
day of ____________, 2002, by Laura L. Mountcastle, Vice President and Treasurer
of CONSUMERS ENERGY COMPANY, a Michigan corporation, on behalf of the
corporation.
------------------------------------
Margaret Hillman, Notary Public
[Seal] Jackson County, Michigan
My Commission Expires: June 14, 2004
S-1
JPMORGAN CHASE BANK, AS TRUSTEE
(SEAL) By
----------------------------
L. O'Brien
Attest: Vice President
- ----------------------------
Trust Officer
Signed, sealed and delivered
by JPMORGAN CHASE BANK
in the presence of
- ----------------------------
- ----------------------------
STATE OF NEW YORK )
ss.
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me this ____
day of _____________, 2002, by L. O'Brien, a Vice President of JPMORGAN CHASE
BANK, a New York corporation, on behalf of the corporation.
--------------------------------------
Notary Public
[Seal] New York County, New York
My Commission Expires:
Prepared by:
Kimberly C. Wilson
212 West Michigan Avenue
Jackson, MI 49201
When recorded, return to:
Consumers Energy Company
General Services Real Estate Department
Attn: Nancy P. Fisher, P-21-411
1945 W. Parnall Road
Jackson, MI 49201
EXHIBIT B-1
REQUIRED OPINIONS FROM
MICHAEL D. VANHEMERT, ESQ.
1. The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Michigan.
2. The execution and delivery of the Credit Documents by the Company and
the performance by the Company of the Obligations have been duly
authorized by all necessary corporate action and proceedings on the
part of the Company and will not:
(a) contravene the Company's Restated Articles of Incorporation, as
amended, or bylaws;
(b) contravene any law or any contractual restriction imposed by any
indenture or any other agreement or instrument evidencing or governing
indebtedness for borrowed money of the Company; or
(c) result in or require the creation of any Lien upon or with respect
to any of the Company's properties (except the lien in favor of the
Agent pursuant to the Inventory Security Agreement and the lien of the
Indenture securing the Bonds).
3. The Credit Documents have been duly executed and delivered by the
Company.
4. To the best of my knowledge, there is no pending or threatened action
or proceeding against the Company or any of its Consolidated
Subsidiaries before any court, governmental agency or arbitrator
(except (i) to the extent described in the Company's annual report on
Form 10-K for the year ended December 31, 2001, quarterly report on
Form 10-Q for the quarter ended June 30, 2002, and current reports on
Form 8-K filed by the Company on July 30, 2002 and September 8, 2002,
in each case as filed with the SEC, and (ii) such other similar
actions, suits and proceedings predicated on the occurrence of the same
events giving rise to any actions, suits and proceedings described in
the reports filed with the SEC set forth in clause (i) of this
paragraph 4) which might reasonably be expected to materially adversely
affect the financial condition or results of operations of the Company
and its Consolidated Subsidiaries, taken as a whole, or that would
materially adversely affect the Company's ability to perform its
obligations under any Credit Document. To the best of my knowledge,
there is no litigation challenging the validity or the enforceability
of any of the Credit Documents.
5. No authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body is required
for the due execution, delivery and performance by the Company of any
Credit Document, except for the authorization to issue, sell or
guarantee secured and/or unsecured short-term debt granted by the
Federal Energy Regulatory Commission in Docket No. ES02-37-000
(hereinafter the "FERC Order"). The FERC Order is in full force and
effect as of the date hereof.
B-1
6. The Bonds, assuming due authentication in accordance with the terms of
the Indenture, are in due and proper form and, when delivered to the
Agent pursuant to the Bond Delivery Agreement, will evidence and secure
the Obligations owing under the Agreement and will be valid and
enforceable obligations of the Company in accordance with their terms,
secured by the lien of the Indenture on an equal and ratable basis with
all other bonds issued thereunder and otherwise entitled to the
benefits provided by the Indenture.
7. The Indenture has been qualified under the Trust Indenture Act of 1939,
as amended, and the execution and delivery of the Supplemental
Indenture will not cause the Indenture to not be so qualified.
8. The Company is not an "investment company" or a company "controlled" by
an "investment company" as such terms are defined in the Investment
Company Act of 1940, as amended.
9. The Company (i) is a "public utility" and a "subsidiary company" of a
"holding company", as such terms are defined in the Public Utility
Holding Company Act of 1935, as amended (the "Holding Company Act"),
and (ii) is currently exempt from all provisions of the Holding Company
Act, except Section 9(a)(2) thereof.
10. In a properly presented case, a Michigan court or a federal court
applying Michigan choice of law rules should give effect to the choice
of law provisions of the Agreement and should hold that the Agreement
is to be governed by the laws of the State of New York rather than the
laws of the State of Michigan, except in the case of those provisions
set forth in the Agreement the enforcement of which would contravene a
fundamental policy of the State of Michigan. In the course of our
review of the Agreement, nothing has come to my attention to indicate
that any of such provisions would do so. Notwithstanding the foregoing,
even if a Michigan court or a federal court holds that the Agreement is
to be governed by the laws of the State of Michigan, the Agreement
constitutes a legal, valid and binding obligation of the Company,
enforceable under Michigan law (including usury provisions) against the
Company in accordance with its terms, subject to (a) the effect of
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally
and (b) the application of general principles of equity (regardless of
whether considered in a proceeding in equity or at law).
B-2
EXHIBIT B-2
REQUIRED OPINIONS FROM
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
1. The execution and delivery of the Credit Documents by the Company and
the performance by the Company of the Obligations will not:
(a) contravene any contractual restriction imposed by the Company
Indentures; or
(b) result in or require the creation of any Lien upon or with respect
to any of the Company's properties pursuant to either of the Company
Indentures.
2. The Agreement constitutes a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms,
subject to (a) the effect of applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and (b) the application of
general principles of equity (regardless of whether considered in a
preceding in equity or at law).
"Company Indentures" means (i) the Indenture dated as of January 1,
1996, as supplemented and amended from time to time, between the Company
(formerly known as Consumers Power Company) and The Bank of New York, as
Trustee, and (ii) the Indenture dated as of February 1, 1998, as supplemented
and amended from time to time, between the Company and JP Morgan Chase Bank
(formerly known as The Chase Manhattan Bank), as Trustee.
B-3
EXHIBIT B-3
REQUIRED OPINIONS FROM
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
1. The Bonds, assuming due authentication in accordance with the terms
of the Indenture, are in due and proper form and, when delivered to the Agent
pursuant to the Bond Delivery Agreement, will evidence and secure the
Obligations owing under the Agreement and will be valid and enforceable
obligations of the Company in accordance with their terms, secured by the lien
of the Indenture on an equal and ratable basis with all other bonds issued
thereunder and otherwise entitled to the benefits provided by the Indenture.
2. The Inventory Security Agreement creates, in favor of the Agent, on
behalf of and for the ratable benefit of the Banks, a valid security interest in
all of the Company's right, title and interest in and to the Collateral (as
defined in the Inventory Security Agreement) to the extent a security interest
may be created therein under Article 9 of the Michigan Uniform Commercial Code.
The financing statement is in proper form for filing with the Secretary of State
of Michigan. Upon the filing of the financing statement in the office of the
Secretary of State of Michigan, such security interest in the Collateral will be
perfected.
B-4
EXHIBIT C
FORM OF COMPLIANCE CERTIFICATE
I, _________________, ______________ of Consumers Energy Company, a
Michigan corporation (the "Company"), DO HEREBY CERTIFY in connection with the
Term Loan Agreement dated as of October 17, 2002 (the "Credit Agreement"; the
terms defined therein being used herein as so defined) among the Company,
various financial institutions and Bank One, NA (Main Office - Chicago), as
Agent, that:
I. Section 8.1 of the Credit Agreement provides that the Company shall:
"At all times, maintain a ratio of Total Consolidated Debt to Total
Consolidated Capitalization of not greater than 0.65 to 1.0."
The following calculations are made in accordance with the definitions
of Total Consolidated Debt and Total Consolidated Capitalization in the
Credit Agreement and are correct and accurate as of _____________, ___:
A. Total Consolidated Debt
(a) Indebtedness for borrowed money $
plus (b) Indebtedness for deferred purchase price of
property/services
plus (c) Unfunded Vested Liabilities
plus (d) Obligations under acceptance facilities
plus (e) Obligations under Capital Leases
plus (f) Obligations under interest rate swap, "cap",
"collar" or other hedging agreement
plus (g) Guaranties, endorsements and
other contingent obligations
minus (h) Principal amount of any Securitized Bonds
minus (i) Junior Subordinated Debt owned by any
Hybrid Preferred Securities Subsidiary
minus (j) Subordinated guaranties by the Company of
payments with respect to Hybrid Preferred
Securities
minus (k) Agreed upon percentage of Net Proceeds
from issuance of hybrid debt/equity
C-1
securities (other than Junior Subordinated
Debt and Hybrid Preferred Securities)
TOTAL $
B. Total Consolidated Capitalization:
(a) Total Consolidated Debt $
(b) Equity of common stockholders
(c) Equity of preference stockholders
(d) Equity of preferred stockholders
TOTAL $
C. Debt to Capital Ratio _____ to 1.00
(total of A divided by total of B)
II. Section 8.2 of the Credit Agreement provides that the Company shall:
"Not permit the ratio, determined as of the end of each of its fiscal
quarters for the then most-recently ended four fiscal quarters, of (i)
Consolidated EBIT to (ii) cash Consolidated Interest Expense to be less
than 2.0 to 1.0"
The following calculations are made in accordance with the
definitions of Consolidated EBIT and Consolidated Interest Expense in the Credit
Agreement and are correct and accurate as of _____________, ___:
A. Consolidated EBIT
(a) Consolidated Net Income $
plus (b) Consolidated Interest Expense $
plus (c) Expense for taxes paid or accrued $
plus (d) Non-cash write-offs and write-downs $
contained in the Company's Consolidated
Net Income, including, without limitation,
write-offs or write-downs related to the sale
of assets, impairment of assets and loss on
contracts
plus (e) For any fiscal period ending prior to March $
31, 2003, pre-tax write-off for the fiscal
period ending December 31, 2001 in an
amount not to exceed $126,000,000 arising
from the loss on Power Purchase Agreement
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- MCV Partnership
minus (f) Extraordinary gains realized other than in $
the ordinary course of business
TOTAL $
B. Consolidated Interest Expense $
C. Interest Coverage Ratio _____ to 1.00
(total of A divided by total of B)
IN WITNESS WHEREOF, I have signed this Certificate this ___ day of
_________, ___.
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EXHIBIT D
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption (the "Assignment and Assumption") is
dated as of the Effective Date set forth below and is entered into by and
between [Insert name of AssignoR] (the "Assignor") and [Insert name of AssigneE]
(the "Assignee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
"Credit Agreement "), receipt of a copy of which is hereby acknowledged by the
Assignee. The Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Agent as contemplated below, the interest in and to all of the Assignor's
rights and obligations in its capacity as a Bank under the Credit Agreement and
any other documents or instruments delivered pursuant thereto that represents
the amount and percentage interest identified below of all of the Assignor's
outstanding rights and obligations under the respective facilities identified
below (including without limitation any letters of credit, guaranties and
swingline loans included in such facilities and, to the extent permitted to be
assigned under applicable law, all claims (including without limitation contract
claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity), suits, causes of action and any other right of the
Assignor against any Person whether known or unknown arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby) (the
"Assigned Interest"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.
1. Assignor:
2. Assignee: __________________________ [and is an affiliate of Assignor]
3. Borrower: CONSUMERS ENERGY COMPANY
4. Agent: Bank One, NA, as the Agent under the Credit Agreement.
5. Credit Agreement: The Term Loan Agreement dated as of October 17, 2002
among Consumers Energy Company, the Banks party thereto, and Bank One, NA, as
Agent.
D-1
6. Assigned Interest:
<Table>
<Caption>
Aggregate Amount
of Commitments/ Amount of Commitments/ Percentage Assigned of
outstanding Term outstanding Term Loans Commitments/
Facility Assigned Loans for all Banks* Assigned* outstanding Term Loans(2)
- ----------------- -------------------- ---------------------- ------------------------
$ $ %
- ----------------- ----------------- ----------------- ------
$ $ %
- ----------------- ----------------- ----------------- ------
$ $ %
- ----------------- ----------------- ----------------- ------
</Table>
7. Trade Date: (4)
--------------------------
Effective Date: ____________________, 20__ [TO BE INSERTED BY AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE
AGENT.]
The terms set forth in this Assignment and Assumption are hereby agreed
to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:
Title:
[Consented to and ](5) Accepted:
BANK ONE, NA, as Agent
By:
Title:
[Consented to:](6)
* Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.
2 Set forth, to at least 9 decimals, as a percentage of the Commitments/Term
Loans of all Banks thereunder.
4 Insert if satisfaction of minimum amounts is to be determined as of the Trade
Date.
5 To be added only if the consent of the Agent is required by the terms of the
Credit Agreement.
6 To be added only if the consent of the Company and/or other parties is
required by the terms of the Credit Agreement.
D-2
[NAME OF RELEVANT PARTY]
By:
Title:
D-3
ANNEX 1
TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor represents and warrants that (i) it
is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim and
(iii) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby. Neither the Assignor nor any of its officers,
directors, employees, agents or attorneys shall be responsible for (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Credit Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency, perfection, priority,
collectibility, or value of the Credit Documents or any collateral thereunder,
(iii) the financial condition of the Company, any of its Subsidiaries or
Affiliates or any other Person obligated in respect of any Credit Document, (iv)
the performance or observance by the Company, any of its Subsidiaries or
Affiliates or any other Person of any of their respective obligations under any
Credit Document, (v) inspecting any of the property, books or records of the
Company, or any guarantor, or (vi) any mistake, error of judgment, or action
taken or omitted to be taken in connection with the Term Loans or the Credit
Documents.
1.2. Assignee. The Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Bank under the Credit
Agreement, (ii) from and after the Effective Date, it shall be bound by the
provisions of the Credit Agreement as a Bank thereunder and, to the extent of
the Assigned Interest, shall have the obligations of a Bank thereunder, (iii)
agrees that its payment instructions and notice instructions are as set forth in
Schedule 1 to this Assignment and Assumption, (iv) 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 Credit Documents will not be
"plan assets" under ERISA, (v) 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 and Assumption, (vi) it has
received a copy of the Credit Agreement, together with copies of financial
statements and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the Agent
or any other Bank, and (vii) attached as Schedule 1 to this Assignment and
Assumption is any documentation required to be delivered by the Assignee with
respect to its tax status pursuant to the terms of the Credit Agreement, duly
completed and executed by the Assignee and (b) agrees that (i) it will,
independently and without reliance on the Agent, the Assignor or any other Bank,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Documents, and
D-4
(ii) it will perform in accordance with their terms all of the obligations which
by the terms of the Credit Documents are required to be performed by it as a
Bank.
2. Payments. The Assignee shall pay the Assignor, on the
Effective Date, the amount agreed to by the Assignor and the Assignee. From and
after the Effective Date, the Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignor for amounts which have accrued to but excluding the
Effective Date and to the Assignee for amounts which have accrued from and after
the Effective Date.
3. General Provisions. This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by, and construed in accordance with, the law
of the State of Illinois.
D-5
ADMINISTRATIVE QUESTIONNAIRE
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
(For Forms for Primary Syndication call Peterine Svoboda at 312-732-8844)
(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)
D-6
US AND NON-US TAX INFORMATION REPORTING REQUIREMENTS
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
(For Forms for Primary Syndication call Peterine Svoboda at 312-732-8844)
(For Forms after Primary Syndication call Jim Bartz at 312-732-1242)
D-7
EXHIBIT E
TERMS OF SUBORDINATION
[JUNIOR SUBORDINATED DEBT]
ARTICLE ____
SUBORDINATION
Section ___.1 Applicability of Article; Securities Subordinated to
Senior Indebtedness.
(a) This Article ____ shall apply only to the Securities of any series
which, pursuant to Section ___, are expressly made subject to this Article. Such
Securities are referred to in this Article ____ as "Subordinated Securities."
(b) The Issuer covenants and agrees, and each Holder of Subordinated
Securities by his acceptance thereof likewise covenants and agrees, that the
indebtedness represented by the Subordinated Securities and the payment of the
principal and interest, if any, on the Subordinated Securities is subordinated
and subject in right, to the extent and in the manner provided in this Article,
to the prior payment in full of all Senior Indebtedness.
"Senior Indebtedness" means the principal of and premium, if any, and
interest on the following, whether outstanding on the date hereof or thereafter
incurred, created or assumed: (i) indebtedness of the Issuer for money borrowed
by the Issuer (including purchase money obligations) or evidenced by debentures
(other than the Subordinated Securities), notes, bankers' acceptances or other
corporate debt securities, or similar instruments issued by the Issuer; (ii) all
capital lease obligations of the Issuer; (iii) all obligations of the Issuer
issued or assumed as the deferred purchase price of property, all conditional
sale obligations of the Issuer and all obligations of the Issuer under any title
retention agreement (but excluding trade accounts payable arising in the
ordinary course of business); (iv) obligations with respect to letters of
credit; (v) all indebtedness of others of the type referred to in the preceding
clauses (i) through (iv) assumed by or guaranteed in any manner by the Issuer or
in effect guaranteed by the Issuer; (vi) all obligations of the type referred to
in clauses (i) through (v) above of other persons secured by any lien on any
property or asset of the Issuer (whether or not such obligation is assumed by
the Issuer), except for (1) any such indebtedness that is by its terms
subordinated to or pari passu with the Subordinated Notes, as the case may be,
including all other debt securities and guaranties in respect of those debt
securities, issued to any other trusts, partnerships or other entities
affiliated with the Issuer which act as a financing vehicle of the Issuer in
connection with the issuance of preferred securities by such entity or other
securities which rank pari passu with, or junior to, the Preferred Securities,
and (2) any indebtedness between or among the Issuer and its affiliates; and/or
(vii) renewals, extensions or refundings of any of the indebtedness referred to
in the preceding clauses unless, in the case of any particular indebtedness,
renewal, extension or refunding, under the express provisions of the instrument
creating or evidencing the same or the assumption or guarantee of the same, or
pursuant to which the same is outstanding, such indebtedness or such renewal,
extension or refunding thereof is not superior in right of payment to the
Subordinated Securities.
E-1
This Article shall constitute a continuing obligation to all Persons
who, in reliance upon such provisions become holders of, or continue to hold,
Senior Indebtedness, and such provisions are made for the benefit of the holders
of Senior Indebtedness, and such holders are made obligees hereunder and they
and/or each of them may enforce such provisions.
Section ___.2 Issuer Not to Make Payments with Respect to Subordinated
Securities in Certain Circumstances.
(a) Upon the maturity of any Senior Indebtedness by lapse of time,
acceleration or otherwise, all principal thereof and premium and interest
thereon shall first be paid in full, or such payment duly provided for in cash
in a manner satisfactory to the holders of such Senior Indebtedness, before any
payment is made on account of the principal of, or interest on, Subordinated
Securities or to acquire any Subordinated Securities or on account of any
sinking fund provisions of any Subordinated Securities (except payments made in
capital stock of the Issuer or in warrants, rights or options to purchase or
acquire capital stock of the Issuer, sinking fund payments made in Subordinated
Securities acquired by the Issuer before the maturity of such Senior
Indebtedness, and payments made through the exchange of other debt obligations
of the Issuer for such Subordinated Securities in accordance with the terms of
such Subordinated Securities, provided that such debt obligations are
subordinated to Senior Indebtedness at least to the extent that the Subordinated
Securities for which they are exchanged are so subordinated pursuant to this
Article ____).
(b) Upon the happening and during the continuation of any default in
payment of the principal of, or interest on, any Senior Indebtedness when the
same becomes due and payable or in the event any judicial proceeding shall be
pending with respect to any such default, then, unless and until such default
shall have been cured or waived or shall have ceased to exist, no payment shall
be made by the Issuer with respect to the principal of, or interest on,
Subordinated Securities or to acquire any Subordinated Securities or on account
of any sinking fund provisions of Subordinated Securities (except payments made
in capital stock of the Issuer or in warrants, rights, or options to purchase or
acquire capital stock of the Issuer, sinking fund payments made in Subordinated
Securities acquired by the Issuer before such default and notice thereof, and
payments made through the exchange of other debt obligations of the Issuer for
such Subordinated Securities in accordance with the terms of such Subordinated
Securities, provided that such debt obligations are subordinated to Senior
Indebtedness at least to the extent that the Subordinated Securities for which
they are exchanged are so subordinated pursuant to this Article ____).
(c) In the event that, notwithstanding the provisions of this Section
___.2, the Issuer shall make any payment to the Trustee on account of the
principal of or interest on Subordinated Securities, or on account of any
sinking fund provisions of such Securities, after the maturity of any Senior
Indebtedness as described in Section ___.2(a) above or after the happening of a
default in payment of the principal of or interest on any Senior Indebtedness as
described in Section ___.2(b) above, then, unless and until all Senior
Indebtedness which shall have matured, and all premium and interest thereon,
shall have been paid in full (or the declaration of acceleration thereof shall
have been rescinded or annulled), or such default shall have been cured or
waived or shall have ceased to exist, such payment (subject to the provisions of
Sections ___.6 and ___.7) shall be held by the Trustee, in trust for the benefit
of, and shall be
E-2
paid forthwith over and delivered to, the holders of such Senior Indebtedness
(pro rata as to each of such holders on the basis of the respective amounts of
Senior Indebtedness held by them) or their representative or the trustee under
the indenture or other agreement (if any) pursuant to which such Senior
Indebtedness may have been issued, as their respective interests may appear, for
application to the payment of all such Senior Indebtedness remaining unpaid to
the extent necessary to pay the same in full in accordance with its terms, after
giving effect to any concurrent payment or distribution to or for the holders of
Senior Indebtedness. The Issuer shall give prompt written notice to the Trustee
of any default in the payment of principal of or interest on any Senior
Indebtedness.
Section ___.3 Subordinated Securities Subordinated to Prior Payment of
All Senior Indebtedness on Dissolution, Liquidation or Reorganization of Issuer.
Upon any distribution of assets of the Issuer in any dissolution, winding up,
liquidation or reorganization of the Issuer (whether voluntary or involuntary,
in bankruptcy, insolvency or receivership proceedings or upon an assignment for
the benefit of creditors or otherwise):
(a) the holders of all Senior Indebtedness shall first be entitled to
receive payments in full of the principal thereof and premium and interest due
thereon, or provision shall be made for such payment, before the Holders of
Subordinated Securities are entitled to receive any payment on account of the
principal of or interest on such Securities;
(b) any payment or distribution of assets of the Issuer of any kind or
character, whether in cash, property or securities (other than securities of the
Issuer as reorganized or readjusted or securities of the Issuer or any other
corporation provided for by a plan of reorganization or readjustment the payment
of which is subordinate, at least to the extent provided in this Article ____
with respect to Subordinated Securities, to the payment in full without
diminution or modification by such plan of all Senior Indebtedness), to which
the Holders of Subordinated Securities or the Trustee on behalf of the Holders
of Subordinated Securities would be entitled except for the provisions of this
Article ____ shall be paid or delivered by the liquidating trustee or agent or
other person making such payment or distribution directly to the holders of
Senior Indebtedness or their representative, or to the trustee under any
indenture under which Senior Indebtedness may have been issued (pro rata as to
each such holder, representative or trustee on the basis of the respective
amounts of unpaid Senior Indebtedness held or represented by each), to the
extent necessary to make payment in full of all Senior Indebtedness remaining
unpaid, after giving effect to any concurrent payment or distribution or
provision thereof to the holders of such Senior Indebtedness; and
(c) in the event that notwithstanding the foregoing provisions of this
Section ___.3, any payment or distribution of assets of the Issuer of any kind
or character, whether in cash, property or securities (other than securities of
the Issuer as reorganized or readjusted or securities of the Issuer or any other
corporation provided for by a plan of reorganization or readjustment the payment
of which is subordinate, at least to the extent provided in this Article ____
with respect to Subordinated Securities, to the payment in full without
diminution or modification by such plan of all Senior Indebtedness), shall be
received by the Trustee or the Holders of the Subordinated Securities on account
of principal of or interest on the Subordinated Securities before all Senior
Indebtedness is paid in full, or effective provision made for its payment, such
payment or distribution (subject to the provisions of Section ___.6 and ___.7)
E-3
shall be received and held in trust for and shall be paid over to the holders of
the Senior Indebtedness remaining unpaid or unprovided for or their
representative, or to the trustee under any indenture under which such Senior
Indebtedness may have been issued (pro rata as provided in subsection (b)
above), for application to the payment of such Senior Indebtedness until all
such Senior Indebtedness shall have been paid in full, after giving effect to
any concurrent payment or distribution or provision therefor to the holders of
such Senior Indebtedness.
The Issuer shall give prompt written notice to the Trustee of any
dissolution, winding up, liquidation or reorganization of the Issuer.
The consolidation of the Issuer with, or the merger of the Issuer into,
another corporation or the liquidation or dissolution of the Issuer following
the conveyance or transfer of its property as an entirety, or substantially as
an entirety, to another corporation upon the terms and conditions provided for
in Article ____ hereof shall not be deemed a dissolution, winding up,
liquidation or reorganization for the purposes of this Section ___.3 if such
other corporation shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions stated such in Article ____.
Section ___.4 Holders of Subordinated Securities to be Subrogated to
Right of Holders of Senior Indebtedness. Subject to the payment in full of all
Senior Indebtedness, the Holders of Subordinated Securities shall be subrogated
to the rights of the holders of Senior Indebtedness to receive payments or
distributions of assets of the Issuer applicable to the Senior Indebtedness
until all amounts owing on Subordinated Securities shall be paid in full, and
for the purposes of such subrogation no payments or distributions to the holders
of the Senior Indebtedness by or on behalf of the Issuer or by or on behalf of
the Holders of Subordinated Securities by virtue of this Article ____ which
otherwise would have been made to the Holders of Subordinated Securities shall,
as between the Issuer, its creditors other than holders of Senior Indebtedness
and the Holders of Subordinated Securities, be deemed to be payment by the
Issuer to or on account of the Senior Indebtedness, it being understood that the
provisions of this Article ____ are and are intended solely for the purpose of
defining the relative rights of the Holders of the Subordinated Securities, on
the one hand, and the holders of the Senior Indebtedness, on the other hand.
Section ___.5 Obligation of the Issuer Unconditional. Nothing contained
in this Article ____ or elsewhere in this Indenture or in any Subordinated
Security is intended to or shall impair, as among the Issuer, its creditors
other than holders of Senior Indebtedness and the Holders of Subordinated
Securities, the obligation of the Issuer, which is absolute and unconditional,
to pay to the Holders of Subordinated Securities the principal of, and interest
on, Subordinated Securities as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders of Subordinated Securities and creditors of the Issuer
other than the holders of the Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or the Holder of any Subordinated Security from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Article ____ of the
holders of Senior Indebtedness in respect of cash, property or securities of the
Issuer received upon the exercise of any such remedy. Upon any payment or
distribution of assets of the Issuer referred to in this Article ____, the
Trustee and Holders of Subordinated Securities shall be entitled to rely upon
any order or
E-4
decree made by any court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are pending, or, subject
to the provisions of Section ___ and ___, a certificate of the receiver, trustee
in bankruptcy, liquidating trustee or agent or other Person making such payment
or distribution to the Trustee or the Holders of Subordinated Securities, for
the purposes of ascertaining the Persons entitled to participate in such
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Issuer, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article
____.
Nothing contained in this Article ____ or elsewhere in this Indenture
or in any Subordinated Security is intended to or shall affect the obligation of
the Issuer to make, or prevent the Issuer from making, at any time except during
the pendency of any dissolution, winding up, liquidation or reorganization
proceeding, and, except as provided in subsections (a) and (b) of Section ___.2,
payments at any time of the principal of, or interest on, Subordinated
Securities.
Section ___.6 Trustee Entitled to Assume Payments Not Prohibited in
Absence of Notice. The Issuer shall give prompt written notice to the Trustee of
any fact known to the Issuer which would prohibit the making of any payment or
distribution to or by the Trustee in respect of the Subordinated Securities.
Notwithstanding the provisions of this Article ____ or any provision of this
Indenture, the Trustee shall not at any time be charged with knowledge of the
existence of any facts which would prohibit the making of any payment or
distribution to or by the Trustee, unless at least two Business Days prior to
the making of any such payment, the Trustee shall have received written notice
thereof from the Issuer or from one or more holders of Senior Indebtedness or
from any representative thereof or from any trustee therefor, together with
proof satisfactory to the Trustee of such holding of Senior Indebtedness or of
the authority of such representative or trustee; and, prior to the receipt of
any such written notice, the Trustee, subject to the provisions of Sections ___
and ___, shall be entitled to assume conclusively that no such facts exist. The
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness (or a
representative or trustee on behalf of the holder) to establish that such notice
has been given by a holder of Senior Indebtedness (or a representative of or
trustee on behalf of any such holder). In the event that the Trustee determines,
in good faith, that further evidence is required with respect to the right of
any Person as a holder of Senior Indebtedness to participate in any payments or
distribution pursuant of this Article ____, the Trustee may request such Person
to furnish evidence to the reasonable satisfaction of the Trustee as to the
amount of Senior Indebtedness held by such Person, as to the extent to which
such Person is entitled to participate in such payment or distribution, and as
to other facts pertinent to the rights of such Person under this Article ____,
and if such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment. The Trustee, however, shall not be deemed to owe any fiduciary
duty to the holders of Senior Indebtedness and nothing in this Article ____
shall apply to claims of, or payments to, the Trustee under or pursuant to
Section ___.
Section ___.7 Application by Trustee of Monies or Government
Obligations Deposited with It. Money or Government Obligations deposited in
trust with the Trustee pursuant to and in accordance with Section ____ shall be
for the sole benefit of Securityholders
E-5
and, to the extent allocated for the payment of Subordinated Securities, shall
not be subject to the subordination provisions of this Article ____, if the same
are deposited in trust prior to the happening of any event specified in Section
___.2. Otherwise, any deposit of monies or Government Obligations by the Issuer
with the Trustee or any paying agent (whether or not in trust) for the payment
of the principal of, or interest on, any Subordinated Securities shall be
subject to the provisions of Section ___.1, ___.2 and ___.3 except that, if
prior to the date on which by the terms of this Indenture any such monies may
become payable for any purposes (including, without limitation, the payment of
the principal of, or the interest, if any, on any Subordinated Security) the
Trustee shall not have received with respect to such monies the notice provided
for in Section ___.6, then the Trustee or the paying agent shall have full power
and authority to receive such monies and Government Obligations and to apply the
same to the purpose for which they were received, and shall not be affected by
any notice to the contrary which may be received by it on or after such date.
This Section ___.7 shall be construed solely for the benefit of the Trustee and
paying agent and, as to the first sentence hereof, the Securityholders, and
shall not otherwise effect the rights of holders of Senior Indebtedness.
Section ___.8 Subordination Rights Not Impaired by Acts or Omissions of
Issuer or Holders of Senior Indebtedness. No rights of any present or future
holders of any Senior Indebtedness to enforce subordination as provided herein
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Issuer or by any act or failure to act, in good faith, by
any such holders or by any noncompliance by the Issuer with the terms of this
Indenture, regardless of any knowledge thereof which any such holder may have or
be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness of the Issuer may, at any time and from time
to time, without the consent of or notice to the Trustee or the Holders of the
Subordinated Securities, without incurring responsibility to the Holders of the
Subordinated Securities and without impairing or releasing the subordination
provided in this Article ____ or the obligations hereunder of the Holders of the
Subordinated Securities to the holders of such Senior Indebtedness, do any one
or more of the following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, such Senior Indebtedness, or
otherwise amend or supplement in any manner such Senior Indebtedness or any
instrument evidencing the same or any agreement under which such Senior
Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing such Senior Indebtedness;
(iii) release any Person liable in any manner for the collection for such Senior
Indebtedness; and (iv) exercise or refrain from exercising any rights against
the Issuer, as the case may be, and any other Person.
Section ___.9 Securityholders Authorize Trustee to Effectuate
Subordination of Securities. Each Holder of Subordinated Securities by his
acceptance thereof authorizes and expressly directs the Trustee on his behalf to
take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article ____ and appoints the Trustee his
attorney-in-fact for such purpose, including in the event of any dissolution,
winding up, liquidation or reorganization of the Issuer (whether in bankruptcy,
insolvency or receivership proceedings or upon an assignment for the benefit of
creditors or otherwise) the immediate filing of a claim for the unpaid balance
of his Subordinated Securities in the form required in said proceedings and
causing said claim to be approved. If the Trustee does not file a proper claim
or
E-6
proof of debt in the form required in such proceeding prior to 30 days before
the expiration of the time to file such claim or claims, then the holders of
Senior Indebtedness have the right to file and are hereby authorized to file an
appropriate claim for and on behalf of the Holders of said Securities.
Section ___.10 Right of Trustee to Hold Senior Indebtedness. The
Trustee in its individual capacity shall be entitled to all of the rights set
forth in this Article ____ in respect of any Senior Indebtedness at any time
held by it to the same extent as any other holder of Senior Indebtedness, and
nothing in this Indenture shall be construed to deprive the Trustee of any of
its rights as such holder.
With respect to the holders of Senior Indebtedness of the Issuer, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article ____, and no implied
covenants or obligations with respect to the holders of such Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of such Senior Indebtedness and,
subject to the provisions of Sections ___.2 and ___.3, the Trustee shall not be
liable to any holder of such Senior Indebtedness if it shall pay over or deliver
to Holders of Subordinated Securities, the Issuer or any other Person money or
assets to which any holder of such Senior Indebtedness shall be entitled by
virtue of this Article ____ or otherwise.
Section ___.11 Article ____ Not to Prevent Events of Defaults. The
failure to make a payment on account of principal or interest by reason of any
provision in this Article ____ shall not be construed as preventing the
occurrence of an Event of Default under Section ----.
E-7
EXHIBIT F
TERMS OF SUBORDINATION
[GUARANTY OF HYBRID PREFERRED SECURITIES]
SECTION ___. This Guarantee will constitute an unsecured obligation of
the Guarantor and will rank subordinate and junior in right of payment to all
other liabilities of the Guarantor and pari passu with any guarantee now or
hereafter entered into by the Guarantor in respect of the securities
representing common beneficial interests in the assets of the Issuer or of any
preferred or preference stock of any affiliate of the Guarantor.
F-1
EXHIBIT G-1
FORM OF BOND DELIVERY AGREEMENT (SUPPLEMENTAL INDENTURE)
BOND DELIVERY AGREEMENT
CONSUMERS ENERGY COMPANY
TO
BANK ONE, NA, AS AGENT
Dated as of October 17, 2002
Relating to
First Mortgage Bonds, Collateral Series due April 15, 2003
------------------
G-1
THIS BOND DELIVERY AGREEMENT (this "Agreement"), dated as of October
17, 2002, is between Consumers Energy Company (the "Company"), and Bank One, NA,
as agent (the "Agent") under the Term Loan Agreement (as amended, supplemented
or otherwise modified from time to time, the "Loan Agreement") dated as of
October 17, 2002, among the Company, the financial institutions parties thereto
(the "Banks"), and the Agent. Capitalized terms used but not otherwise defined
herein have the respective meanings assigned to such terms in the Loan
Agreement.
Whereas, the Company entered into the Loan Agreement and has made
borrowings thereunder in accordance with the provisions thereof;
Whereas, the Company has established its First Mortgage Bonds,
Collateral Series due 2003, in the initial aggregate principal amount of
$70,000,000 (the "Bonds") to be issued under and in accordance with that certain
Eighty-Fifth Supplemental Indenture dated as of October 17, 2002 (the
"Supplemental Indenture"), to the Indenture of the Company to JPMorgan Chase
Bank (formerly known as The Chase Manhattan Bank) dated as of September 1, 1945
(as amended and supplemented, the "Indenture"); and
Whereas, the Company proposes to issue and deliver to the Agent, for
the benefit of the Banks, the Bonds in order to provide the Bonds as evidence of
(and the benefit of the lien of the Indenture with respect to the Bonds for) the
Obligations of the Company arising under the Loan Agreement;
Now, therefore, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the Company and the Agent hereby agree as follows:
ARTICLE I
THE BONDS
Section 1.1 Delivery of Bonds.
In order to provide the Bonds as evidence of (and through the Bonds the
benefit of the Lien of the Indenture for) the Obligations of the Company under
the Loan Agreement as aforesaid, the Company hereby delivers to the Agent the
Bonds in the aggregate principal amount of $70,000,000, maturing on April 15,
2003 and bearing interest as provided in the Supplemental Indenture. The
obligation of the Company to pay the principal of and interest on the Bonds
shall be deemed to have been satisfied and discharged in full or in part, as the
case may be, to the extent of payment by the Company of the Obligations, all as
set forth in the Bonds and in Section 1 of the Supplemental Indenture.
The Bonds are registered in the name of the Agent and shall be owned
and held by the Agent, subject to the provisions of this Agreement, for the
benefit of the Banks, and the Company shall have no interest therein. The Agent
shall be entitled to exercise all rights of bondholders under the Indenture with
respect to the Bonds.
The Agent hereby acknowledges receipt of the Bonds.
G-2
Section 1.2 Payments on the Bonds.
Any payments received by the Agent on account of the principal of or
interest on the Bonds shall be deemed to be and treated in all respects as
payments of the Obligations, and such payments shall be distributed by the Agent
to the Banks in accordance with the provisions of the Loan Agreement applicable
to payments received by the Agent in respect of the Obligations (and the Company
hereby consents to such distributions).
ARTICLE II
NO TRANSFER OF BONDS; SURRENDER OF BONDS
Section 2.1 No Transfer of the Bonds.
The Agent shall not sell, assign or otherwise transfer any Bonds
delivered to it under this Agreement except to a successor administrative agent
under the Loan Agreement. The Company may take such actions as it shall deem
necessary, desirable or appropriate to effect compliance with such restrictions
on transfer, including the issuance of stop-transfer instructions to the trustee
under the Indenture or any other transfer agent thereunder.
Section 2.2 Surrender of Bonds.
(A) The Agent shall forthwith surrender to or upon the order
of the Company all Bonds held by it at the first time at which the
Commitments shall have been terminated and all Obligations shall have
been paid in full.
(B) Upon any permanent reduction in the Commitments and/or
prepayments of Term Loans pursuant to the terms of the Loan Agreement,
the Agent shall forthwith surrender to or upon the order of the Company
Bonds in an aggregate principal amount equal to the excess of the
aggregate principal amount of Bonds held by the Agent over the sum of
the total Commitments and the aggregate outstanding Term Loans.
ARTICLE III
GOVERNING LAW
This Agreement shall construed in accordance with and governed by the
internal laws (without regard to the conflict of laws provisions) of the State
of New York, but giving effect to Federal laws applicable to national banks.
[SIGNATURE PAGE FOLLOWS]
G-3
IN WITNESS WHEREOF, the Company and the Agent have caused this Agreement to be
executed and delivered as of the date first above written.
CONSUMERS ENERGY COMPANY
By:
----------------------
Name:
Title:
BANK ONE, NA, as Agent
By:
----------------------
Name:
Title:
G-4
EXHIBIT G-2
FORM OF BOND DELIVERY AGREEMENT (INCREMENTAL SUPPLEMENTAL INDENTURE)
BOND DELIVERY AGREEMENT
CONSUMERS ENERGY COMPANY
TO
BANK ONE, NA, AS AGENT
Dated as of [______________], 2002
Relating to
First Mortgage Bonds, Collateral Series due April 15, 2003
------------------
G-5
THIS BOND DELIVERY AGREEMENT (this "Agreement"), dated as of
[________], 2002, is between Consumers Energy Company (the "Company"), and Bank
One, NA, as agent (the "Agent") under the Term Loan Agreement (as amended,
supplemented or otherwise modified from time to time, the "Loan Agreement")
dated as of October 17, 2002, among the Company, the financial institutions
parties thereto (the "Banks"), and the Agent. Capitalized terms used but not
otherwise defined herein have the respective meanings assigned to such terms in
the Loan Agreement.
Whereas, the Company entered into the Loan Agreement and has made
borrowings thereunder in accordance with the provisions thereof;
Whereas, the Company established certain First Mortgage Bonds,
Collateral Series due 2003, in the aggregate principal amount of $70,000,000
(the "Initial Bonds") to be issued under and in accordance with that certain
Eighty-Fifth Supplemental Indenture dated as of October 17, 2002 (the "Initial
Supplemental Indenture") to the Indenture of the Company to JPMorgan Chase Bank
(formerly known as The Chase Manhattan Bank) dated as of September 1, 1945 (as
amended and supplemented, the "Indenture");
Whereas, the Company has established its First Mortgage Bonds,
Collateral Series due 2003, in the aggregate principal amount of $[INSERT AMOUNT
OF DEFERRED DRAW TERM LOAN] (the "Bonds") to be issued under and in accordance
with that certain Eighty-Sixth Supplemental Indenture dated as of [________],
2002 (the "Supplemental Indenture"), to the Indenture; and
Whereas, the Company proposes to issue and deliver to the Agent, for
the benefit of the Banks, the Bonds in order to provide the Bonds as additional
evidence of (and the benefit of the lien of the Indenture with respect to the
Bonds for) the Obligations of the Company arising under the Loan Agreement;
Now, therefore, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the Company and the Agent hereby agree as follows:
ARTICLE I
THE BONDS
Section 1.1 Delivery of Bonds.
In order to provide the Bonds as evidence of (and through the Bonds the
benefit of the Lien of the Indenture for) the Obligations of the Company under
the Loan Agreement as aforesaid, the Company hereby delivers to the Agent the
Bonds in the aggregate principal amount of $[INSERT AMOUNT OF DEFERRED DRAW TERM
LOAN], maturing on April 15, 2003 and bearing interest as provided in the
Supplemental Indenture. Without duplication in respect of any payment in respect
of the Initial Bonds, the obligation of the Company to pay the principal of and
interest on the Bonds shall be deemed to have been satisfied and discharged in
full or in part, as the case may be, to the extent of payment by the Company of
the Obligations, all as set forth in the Bonds and in Section 1 of the
Supplemental Indenture.
G-6
The Bonds are registered in the name of the Agent and shall be owned
and held by the Agent, subject to the provisions of this Agreement, for the
benefit of the Banks, and the Company shall have no interest therein. The Agent
shall be entitled to exercise all rights of bondholders under the Indenture with
respect to the Bonds.
The Agent hereby acknowledges receipt of the Bonds.
Section 1.2 Payments on the Bonds.
Without duplication in respect of any payment in respect of the Initial
Bonds, any payments received by the Agent on account of the principal of or
interest on the Bonds shall be deemed to be and treated in all respects as
payments of the Obligations, and such payments shall be distributed by the Agent
to the Banks in accordance with the provisions of the Loan Agreement applicable
to payments received by the Agent in respect of the Obligations (and the Company
hereby consents to such distributions).
ARTICLE II
NO TRANSFER OF BONDS; SURRENDER OF BONDS
Section 2.1 No Transfer of the Bonds.
The Agent shall not sell, assign or otherwise transfer any Bonds
delivered to it under this Agreement except to a successor administrative agent
under the Loan Agreement. The Company may take such actions as it shall deem
necessary, desirable or appropriate to effect compliance with such restrictions
on transfer, including the issuance of stop-transfer instructions to the trustee
under the Indenture or any other transfer agent thereunder.
Section 2.2 Surrender of Bonds.
(C) The Agent shall forthwith surrender to or upon the order
of the Company all Bonds held by it at the first time at which the
Commitments shall have been terminated and all Obligations shall have
been paid in full.
(D) Without duplication in respect of the surrender of any
Initial Bonds, upon any permanent reduction in the Commitments and/or
prepayments of Term Loans pursuant to the terms of the Loan Agreement,
the Agent shall forthwith surrender to or upon the order of the Company
Bonds in an aggregate principal amount equal to the excess of the
aggregate principal amount of Bonds held by the Agent over the sum of
the total Commitments and the aggregate outstanding Term Loans.
ARTICLE III
GOVERNING LAW
This Agreement shall construed in accordance with and governed by the
internal laws (without regard to the conflict of laws provisions) of the State
of New York, but giving effect to Federal laws applicable to national banks.
[SIGNATURE PAGE FOLLOWS]
G-7
IN WITNESS WHEREOF, the Company and the Agent have caused this Agreement to be
executed and delivered as of the date first above written.
CONSUMERS ENERGY COMPANY
By:
----------------------
Name:
Title:
BANK ONE, NA, as Agent
By:
----------------------
Name:
Title:
G-8
COMMITMENT SCHEDULE
<Table>
<Caption>
INITIAL TERM DEFERRED DRAW INCREMENTAL
LOAN TERM LOAN DEFERRED DRAW
BANK COMMITMENT COMMITMENTS COMMITMENTS*
- ---- ------------ ------------- -------------
Bank One, NA $38,888,889 $2,777,778 $44,444,444
Barclays Bank PLC $31,111,111 $2,222,222 $35,555,556
AGGREGATE $70,000,000 $5,000,000 $80,000,000
COMMITMENTS
</Table>
*No Bank's Incremental Deferred Draw Commitment shall be
effective and binding on such Bank, and no Bank shall be required to make any
Deferred Draw Term Loan pursuant to any Incremental Deferred Draw Commitment
hereunder, unless and until the Company shall have satisfied the conditions set
forth in Section 11.2.