EXHIBIT 3.2
LIMITED
LIABILITY COMPANY
AGREEMENT
LIMITED LIABILITY COMPANY AGREEMENT
OF
COMED FUNDING, LLC
A DELAWARE LIMITED LIABILITY COMPANY
THIS LIMITED LIABILITY COMPANY AGREEMENT (this "Agreement") of ComEd
Funding, LLC, a Delaware limited liability company (the "Company"), is made and
entered into as of July 21, 1998, by and between the Company and Commonwealth
Edison Company, an Illinois corporation, as the sole member of the Company (the
"Sole Member"). Pursuant to Section 18-201(d) of the Act (as defined herein)
this Agreement shall be effective as of July 21, 1998.
WHEREAS, the Sole Member has caused to be filed a Certificate of
Formation with the Secretary of State of the State of Delaware (the "Secretary")
to organize the Company under and pursuant to the Act (as herein defined);
WHEREAS, upon the terms and subject to the conditions set forth
herein, the Sole Member is concurrently with the execution of this Agreement
acquiring a Membership Interest (as herein defined) in the Company; and
WHEREAS, in accordance with the Act, each of the Company and the Sole
Member desires to enter into this Agreement to set forth the respective rights,
powers and interests of the Sole Member with respect to the Company and its
Membership Interest therein and to provide for the management of the business
and operations of the Company.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained and other good and valuable consideration, the
receipt, adequacy and sufficiency of which are hereby acknowledged, the Sole
Member and the Company, intending to be legally bound, hereby agree as follows:
ARTICLE 1
DEFINITIONS
1.1 DEFINITIONS. Except as otherwise herein expressly provided,
the following terms and phrases shall have the meanings as set forth below:
"ACT" shall mean the Delaware Limited Liability Act, 6 Del. C.
Sections 18-101 ET SEQ., as the same may hereafter be amended from time to time.
"AFFILIATE" shall mean, when used with reference to a specific
Person, any other Person that, directly or indirectly, through one or more
intermediaries, Controls, is Controlled by or is under common Control with such
specific Person.
"AGREEMENT" shall mean this instrument comprising the Limited
Liability Company Agreement of the Company, as amended, modified, supplemented
or restated from time to time in accordance with this Agreement.
"BASIC DOCUMENTS" shall mean all agreements, instruments and
other documents entered into from time to time by the Company in connection with
the acquisition and sale of intangible transition property under the Funding
Law, and the issuance of transitional funding instruments by the Company or by
any assign of such intangible transition property including, but not limited to,
any Agreement Relating to Grant of Intangible Transition Property, any
Intangible Transition Property Sale Agreement, the Intangible Transition
Property Servicing Agreement, any Declaration of Trust, the Administration
Agreement and all other documents and certificates delivered in connection
therewith.
"BUSINESS DAY" shall mean any day that is not a Saturday,
Sunday or a day on which banking institutions in the State of Illinois, the
State of New York or the Depository Trust Company are authorized or obligated by
law or executive order to close.
"CAPITAL CONTRIBUTION" shall mean, with respect to the Sole
Member, the amount of cash and the initial value of any Contributed Property
(net of liabilities to which such property is subject).
"CERTIFICATE" shall mean the Certificate of Formation of the
Company originally filed with the Secretary on July 21, 1998 as described in
Section 2.1, and as further amended, modified, supplemented, or restated from
time to time.
"COMPANY" shall have the meaning assigned to such term in the
preamble hereto.
"COMED AFFILIATED GROUP" shall mean the Sole Member, Unicom
Corporation, an Illinois corporation and any Affiliate of such companies (other
than the Company).
"CONTRIBUTED PROPERTY" shall mean any property or other
assets, in such form as may be permitted by the Act, but excluding cash,
contributed or deemed contributed to the Company with respect to the Membership
Interest held by the Sole Member.
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"CONTROL" shall mean any of the following: (a) in the case of
a corporation, ownership, directly or through ownership of other Entities, of at
least ten percent (10%) of all the voting stock (exclusive of stock which is
voting only as required by applicable law or in the event of nonpayment of
dividends and pays dividends only on a nonparticipating basis at a fixed or
floating rate); (b) in the case of any other Entity, ownership, directly or
through ownership of other Entities, of at least ten percent (10%) of all of the
beneficial equity interests therein, (calculated by a method that excludes from
equity interests, ownership interests that are nonvoting (except as required by
applicable law or in the event of nonpayment of dividends or distributions) and
pay dividends or distributions only on a non-participating basis at a fixed or
floating rate); (c) in any case, the ability, whether by the direct or indirect
ownership of shares or other equity interests, by contract or otherwise, to
elect a majority of the directors of a corporation, to select the managing
partner of a partnership, to select a manager of a limited liability company, or
otherwise to select, or have the power to remove and then select, a majority of
those Persons exercising governing authority over an Entity or to exercise
governing authority over an Entity; (d) in the case of a limited partnership,
being the sole general partner, any of the general partners to the extent each
has equal management control and authority, or the managing general partner or
managing general partners thereof; (e) in the case of a limited liability
company that has one or more managers, being a manager; or (f) in the case of a
trust, being trustee thereof or any Person having the right to select any such
trustee.
"ENTITY" shall mean any general partnership, limited
partnership, limited liability company, corporation, joint venture, foundation,
trust, business trust, real estate investment trust or association.
"EVENT OF BANKRUPTCY" shall mean, with respect to any Person,
that such Person shall (A) institute proceedings to be adjudicated bankrupt or
insolvent, (B) consent to the institution of bankruptcy or insolvency
proceedings against it, (C) file a petition seeking or consent to reorganization
or relief under any applicable federal or state law relating to bankruptcy, (D)
consent to the appointment of a receiver, liquidator, assignee, trustee,
sequestrator (or other similar official) of such Person or a substantial part of
its property, (E) make a general assignment for the benefit of creditors or (F)
admit in writing its inability to pay its debts generally as they become due.
"FUNDING LAW" shall mean the Electric Utility Transitional
Funding Law of 1997, 220 ILCS 5/18-101 ET SEQ.
"GAAP" shall mean generally accepted accounting principles in
effect in the United States from time to time.
"INDEPENDENT MANAGER" shall mean a natural person who is
familiar with and has experience with asset securitization and is not at the
time of appointment, has not been at any time preceding such appointment and is
not during the term of such appointment (other than as incidental to such
person's role as Independent Manager): (i) a member, stockholder, partner,
director, manager, officer or employee of any member of the ComEd Affiliated
Group; (ii) a customer, supplier or other person who derives more than ten
percent (10%) of its purchases or revenues from its activities with
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the Company or any member of the ComEd Affiliated Group; or (iii) a member of
the family of any such member, stockholder, partner, director, manager, officer,
employee, customer or supplier.
"INTANGIBLE TRANSITION PROPERTY" shall have the meaning
specified in Section 2.3.
"MANAGEMENT AGREEMENT" shall mean the agreement of the members
of the Management Committee in the form attached hereto as Exhibit B. The
Management Agreement shall be deemed incorporated into, and part of, this
Agreement.
"MANAGEMENT COMMITTEE" shall mean a committee formed upon or
prior to the acquisition by the Company of Intangible Transition Property and
composed of not less than three nor more than five individuals, at least one of
whom at all times must qualify as an Independent Manager. The Company shall be
without authority to take the actions specified herein as requiring the vote or
consent of the Management Committee absent the currently effective appointment
of an Independent Manager to the Management Committee.
"MANAGER" shall mean a member of the Management Committee.
"MEMBER" shall mean a member of the Company.
"MEMBERSHIP INTEREST" shall mean, with respect to the Sole
Member, the limited liability company interest of the Sole Member in the
Company.
"NET CASH FLOWS" shall mean the excess of revenue over
expenses less any reserves the Management Committee considers appropriate or
necessary for the conduct of business.
"PERSON" shall mean any natural person or Entity.
"SALE AGREEMENTS" shall have the meaning specified in
Section 2.3.
"SECRETARY" shall have the meaning assigned to such term in
the first recital of this Agreement.
"SOLE MEMBER" shall have the meaning assigned to such term in
the preamble hereto.
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ARTICLE 2
FORMATION AND BUSINESS OF THE COMPANY
2.1 FORMATION. The Company has been organized as a Delaware
limited liability company under and pursuant to the Act by filing on July 21,
1998 a Certificate of Formation with the Secretary as required by the Act by
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, as an authorized person under the Act. To the extent that the
rights or obligations of the Sole Member are different by reason of any
provision of this Agreement than they would be in the absence of such provision,
this Agreement shall, to the extent permitted by the Act, control.
2.2 NAME. The name of the Company shall be "ComEd Funding, LLC."
The business of the Company may be conducted under that name or, upon compliance
with applicable laws, any other name that the Sole Member deems appropriate or
advisable. The Sole Member shall cause to be filed any fictitious name
certificates and similar filings, and any amendments thereto that the Management
Committee considers appropriate or advisable.
2.3 PURPOSE. The purpose for which the Company is formed is
limited solely to:
(a) acquire, own, hold, administer, service or enter into
agreements regarding the receipt and servicing of "intangible transition
property" as such term is defined in the Funding Law as of the date hereof
("INTANGIBLE TRANSITION PROPERTY"), which Article is also known as the
Electric Utility Transitional Funding Law of 1997, along with certain other
related assets;
(b) manage, sell, assign, pledge, collect amounts due on or
otherwise deal with the intangible transition property and related assets
to be so acquired in accordance with the terms of the "Sale Agreements" as
defined below;
(c) enter into, perform and comply with one or more sale
agreements, assignment agreements, or other agreements providing for the
sale of the aforementioned intangible transition property and related
assets (collectively, the "SALE AGREEMENTS") and to enter into, perform and
comply with such servicing agreements, interest rate swap agreements,
administration agreements, collection account agreements and other similar
agreements as may be necessary or desirable in connection with such Sale
Agreements;
(d) enter into, perform and comply with one or more declarations
of trust related to the creation of one or more Delaware business trusts to
be formed in connection with the transactions contemplated by the Sale
Agreements; and
(e) engage in any lawful act or activity and to exercise any
powers permitted to limited liability companies formed under the laws of
the State of Delaware that, in either case, are incidental to and
necessary, suitable or convenient for the accomplishment of the
above-mentioned purposes.
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The Company shall not engage in any activity other than in connection with
the foregoing or other than as required or authorized by the terms of any Sale
Agreements or other agreement referenced above. The Company shall have all
powers reasonably necessary or convenient to effect the foregoing purposes,
including all powers granted under the Act. The Company, and the Sole Member or
any Manager, including the Independent Manager, on behalf of the Company, may
enter into and perform the Basic Documents and all documents, agreements,
certificates or financing statements contemplated thereby or related thereto,
all without any further act, vote or approval of any Member, Manager or other
person or entity, notwithstanding any other provision of this Agreement, the
Act, or other applicable law, rule or regulation. The authorization set forth
in the preceding sentence shall not be deemed a restriction on the power and
authority of the Sole Member or any Manager, including the Independent Manager,
to enter into other agreements or documents on behalf of the Company.
2.4 PRINCIPAL OFFICE. The location of the principal place of
business of the Company shall be at such location as shall be selected from time
to time by the Sole Member.
2.5 REGISTERED AGENT AND REGISTERED OFFICE. The registered agent
of the Company shall be the initial registered agent named in the Certificate or
such other Person or Persons as the Sole Member may designate from time to time
in the manner provided by the Act. The registered office of the Company
required by the Act to be maintained in the State of Delaware shall be the
initial registered office named in the Certificate or such other office (which
need not be a place of business of the Company) as the Sole Member may designate
from time to time in the manner provided by the Act.
2.6 SEPARATE EXISTENCE. The Company shall:
(i) Maintain in full effect its existence, rights and franchises
as a limited liability company under the laws of the State of Delaware and
obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the
validity and enforceability of this Agreement and each other instrument or
agreement necessary or appropriate to the proper administration hereof and
to permit and effectuate the undertakings contemplated hereby.
(ii) Maintain with commercial banking institutions its own deposit
account or accounts separate from those of any Affiliate of the ComEd
Affiliated Group.
(iii) Ensure that, to the extent that it shares the same officers or
other employees with its Sole Member or any Affiliate of the ComEd
Affiliated Group, the salaries of and the expenses related to providing
benefits to such officers and other employees shall be fairly allocated
among such entities, and each such entity shall bear its fair share of the
salary and benefit costs associated with all such common officers and
employees.
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(iv) Pay all of its operating expenses incurred by it from the
assets of the Company, and ensure that, to the extent that it jointly
contracts with its Sole Member or any Affiliate of the ComEd Affiliated
Group to do business with vendors or service providers or to share overhead
expenses, the costs incurred in so doing shall be allocated fairly among
such entities, and each such entity shall bear its fair share of such
costs.
(v) Maintain a principal executive and administrative office
through which its business is conducted separate from those of its Sole
Member and any Affiliate of the ComEd Affiliated Group. To the extent that
the Company and its Sole Member or any Affiliate of the ComEd Affiliated
Group have offices in contiguous space, there shall be fair and appropriate
allocation of overhead costs among them, and each such entity shall bear
its fair share of such expenses.
(vi) Observe all necessary, appropriate and customary formalities,
including, but not limited to, holding all regular and special Members'
meetings, and meetings of the Company's Management Committee, appropriate
to authorize all action on behalf of the Company, keeping all resolutions
or consents necessary to authorize actions taken or to be taken, and
maintaining accurate and separate books, records and accounts, including,
but not limited to, payroll and intercompany transaction accounts.
(vii) At all times from and after the entry into any Sale Agreement
and the acquisition of any Intangible Transition Property, vest the
management of the Company in the Management Committee and ensure that its
Management Committee shall at all times include at least one Independent
Manager.
(viii) Refrain from commingling its assets with those of the Sole
Member or any member of the ComEd Affiliated Group (except as contemplated
by any Sale Agreement and any servicing or administration agreements
entered into in connection therewith).
(ix) Act solely in its own name and through its own authorized
managers and agents, and no Affiliate of the ComEd Affiliated Group shall
be appointed to act as agent of the Company, except as expressly
contemplated by the Basic Documents.
(x) Ensure that no Affiliate of the ComEd Affiliated Group shall
advance funds to the Company, or otherwise guaranty debts of, the Company,
except as provided in the Basic Documents; PROVIDED, HOWEVER, that any
Affiliate of the ComEd Affiliated Group may provide funds to the Company in
connection with the initial capitalization of the Company or as thereafter
permitted by the Basic Documents with any subsequent capitalization.
(xi) Not enter into any guaranty, or otherwise become liable, with
respect to any obligation of any Affiliate of the ComEd Affiliated Group
and not hold itself out, or permit itself to be held out, as having agreed
to pay or as being liable for the debts of ComEd or any other member of the
ComEd Affiliated Group.
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(xii) Comply with all restrictions on its business and operations as
set forth in the Section 2.3.
2.7 LIMITATION ON CERTAIN ACTIVITIES. Notwithstanding any other
provisions of this Agreement or the Certificate, the Company, and the Sole
Member or Management Committee on behalf of the Company, shall not:
(i) engage in any business or activity other than as set forth in
Article II hereof;
(ii) without the affirmative vote of its Sole Member and (at any
time after the formation of the Management Committee) the affirmative vote
of all of the Managers , initiate any Event of Bankruptcy with respect to
the Company or take any company action in furtherance of any such Event of
Bankruptcy;
(iii) merge or consolidate with any other corporation, company, or
entity or, except to the extent permitted by each Sale Agreement, sell all
or substantially all of its assets or acquire all or substantially all of
the assets or capital stock or other ownership interest of any other
corporation, company or entity;
(iv) incur any indebtedness or assume or guarantee any indebtedness
of any person (other than the indebtedness incurred under the Sale
Agreements); or
(v) to the fullest extent permitted by law, without the
affirmative vote of its Member and (at any time after the formation of the
Management Committee) the affirmative vote of all Managers, execute any
dissolution, liquidation, or winding up of the Company.
To the fullest extent permitted by applicable law, including without limitation
Section 18-1101(c) of the Act, the fiduciary duty of each Manager, including the
Independent Manager, in respect of any decision on any matter referred to in
this Section 2.7 shall be owed solely to the Company (including its creditors)
and not to the Sole Member or any other holders of equity interest in the
Company as may exist at such time.
2.8 NO STATE LAW PARTNERSHIP. No provisions of this Agreement
(including, without limitation, the provisions of Article 6) shall be deemed or
construed to constitute a partnership (including, without limitation, a limited
partnership) or joint venture, or the Sole Member a partner or joint venturer of
or with any Manager or the Company, for any purposes.
2.9 ADDRESS OF THE SOLE MEMBER. The address of the Sole Member is
set forth on EXHIBIT A, as amended from time to time, attached hereto and made a
part hereof.
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ARTICLE 3
TERM
3.1 COMMENCEMENT. The Company's term commenced upon the filing of
the Certificate with the Secretary on July 21, 1998.
3.2 CONTINUATION. Notwithstanding any provision of this Agreement,
the bankruptcy (as defined in Section 18-101(1) of the Act and including any
event described in Section 18-304 (a) of the Act) of the Sole Member will not
cause the Sole Member to cease to be a Member of the Company, and upon the
occurrence of such an event, the business of the Company shall continue without
dissolution. Notwithstanding any other provision of this Agreement, the Sole
Member waives any right it might have under Section 18-801 of the Act to agree
in writing to dissolve the Company upon the occurrence of the bankruptcy (as
defined in Section 18-101(1) of the Act and including any event described in
Section 18-304(a) of the Act) of the Member or the occurrence of any other event
which under the Act would otherwise cause the Sole Member to cease to be a
Member of the Company.
ARTICLE 4
CAPITAL CONTRIBUTIONS
4.1 CAPITAL CONTRIBUTION. The Sole Member has made an initial
capital contribution of $1,000. The Sole Member may be required or shall be
permitted to contribute additional Capital Contributions in cash or property to
the Company on such terms and conditions as may be agreed to by the Sole Member
from time to time. The amounts so contributed by the Sole Member shall be
credited to the Sole Member's capital account, as provided in Section 4.2 below.
The Sole Member shall have a Membership Interest of one hundred percent (100%)
of the Company.
4.2 CAPITAL ACCOUNT. The Company shall establish an individual
Capital Account for the Sole Member.
4.3 NO INTEREST ON OR RETURN OF CAPITAL CONTRIBUTION. The Sole
Member shall not be entitled to interest on its Capital Contribution or Capital
Account. Except as provided herein or by law, the Sole Member shall have no
right to demand or receive the return of its Capital Contribution.
ARTICLE 5
ALLOCATIONS; BOOKS
5.1 ALLOCATIONS OF INCOME AND LOSS.
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(a) BOOK ALLOCATIONS. The net income and net loss of the
Company shall be allocated entirely to the Sole Member.
(b) TAX ALLOCATIONS. Because the Company is not making (and
will not make) an election to be treated as an association taxable as a
corporation under Section 301.7701-3(a) of the U.S. Treasury Regulations, and
because the Company is a business entity that has a single owner and is not a
corporation, it shall be disregarded as an entity separate from its owner for
federal income tax purposes under Section 301.7701-3(b)(1) of the U.S. Treasury
Regulations. Accordingly, all items of income, gain, loss, deduction and credit
of the Company for all taxable periods will be treated for federal income tax
purposes, and for state and local income and other tax purposes to the extent
permitted by applicable law, as realized or incurred directly by the Sole
Member. To the extent not so permitted, all items of income, gain, loss,
deduction and credit of the Company shall be allocated entirely to the Sole
Member.
5.2 BOOKS OF ACCOUNT. At all times during the continuance of the
Company, the Company shall maintain or cause to be maintained full, true,
complete and correct books of account in accordance with GAAP, using the fiscal
year and taxable year of the Sole Member. In addition, the Company shall keep
all records required to be kept pursuant to the Act.
5.3 DISTRIBUTIONS. The Company may distribute all or any portion
of Net Cash Flows to the Sole Member upon the unanimous vote of the Management
Committee; provided that the Management Committee shall not authorize such
distributions more frequently than monthly. Notwithstanding any provision to
the contrary contained in this Agreement, the Company shall not be required to
make a distribution to any Member on account of its interest in the Company if
such distribution would violate Section 18-607 of the Act or any other
applicable law or any Basic Documents.
ARTICLE 6
MANAGEMENT OF THE COMPANY
6.1 MANAGEMENT OF COMPANY. At all times from and after the
Company's entry into any Sale Agreement or acquisition of any Intangible
Transition Property, the property and business of the Company shall be
controlled and managed by the Management Committee; PROVIDED, however, that
except as otherwise provided in this Agreement, the Sole Member acting alone can
bind or execute any instrument on behalf of the Company, and may sign all
checks, drafts, and other instruments obligating the Company to pay money.
Prior to the entry into any Sale Agreement and the acquisition of any Intangible
Transition Property, the Sole Member shall appoint an Independent Manager . In
the event that the Independent Manager withdraws, resigns or is removed as
Independent Manager, the Sole Member shall appoint, as soon as reasonably
practicable, a successor Independent Manager. The Company shall pay the
Independent Manager an annual fee of not less than $3,500 per year. Each
Manager, including the Independent Manager, is hereby deemed to be a "manager"
within the meaning of Section 18-101(10) of the Act.
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6.2 WITHDRAWAL OF MANAGER. Notwithstanding anything herein to the
contrary, the Independent Manager may not withdraw or resign as a Manager of the
Company without the consent of the Sole Member.
6.3 DUTIES OF MANAGERS. To the fullest extent permitted by
applicable law, including without limitation Section 18-1101(c) of the Act, the
fiduciary duty of each Manager, including the Independent Manager, in respect of
any decision on any matter referred to in Section 2.7 shall be owed solely to
the Company (including its creditors) and not to the Member or any other holders
of equity interest in the Company as may exist at such time. Each Manager
shall execute and deliver the Management Agreement.
6.4 REMOVAL OF MANAGERS. A Manager (including the Independent
Manager) may be removed at any time, with or without cause, upon the written
election of the Sole Member.
ARTICLE 7
DISSOLUTION, LIQUIDATION AND WINDING-UP
7.1 DISSOLUTION. The Company shall continue until dissolved and
terminated upon the occurrence of the earliest of the following events:
(a) the election to dissolve the Company made in writing by
the Sole Member and each Manager, including without limitation the Independent
Manager, as permitted by the Basic Documents;
(b) the sale or other disposition of all or substantially
all of the assets of the Company in accordance with the Basic Documents;
(c) the occurrence of any event that causes the last
remaining Member of the Company to cease to be a Member of the Company unless
the business of the Company is continued without dissolution in a manner
permitted by the Act; or
(d) the entry of a decree of judicial dissolution of the
Company pursuant to Section 18-802 of the Act.
7.2 ACCOUNTING. In the event of the dissolution, liquidation and
winding-up of the Company, a proper accounting shall be made of the Capital
Account of the Sole Member and of the net income or net loss of the Company from
the date of the last previous accounting to the date of dissolution.
7.3 CERTIFICATE OF CANCELLATION. As soon as possible following
the occurrence of any of the events specified in Section 7.1 and the completion
of the winding up of the Company, the person or entity winding up the business
and affairs of the Company shall cause to be executed
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a Certificate of Cancellation of the Certificate in such form as shall be
prescribed by the Secretary and file the Certificate of Cancellation of the
Certificate as required by the Act.
7.4 WINDING UP. Upon the occurrence of any event specified in
Section 7.1, the Company shall continue solely for the purpose of winding up its
affairs in an orderly manner, liquidating its assets, and satisfying the claims
of its creditors. The Sole Member shall be responsible for overseeing the
winding up and liquidation of the Company, shall take full account of the
liabilities of the Company and its assets, shall either cause its assets to be
sold or distributed, and if sold as promptly as is consistent with obtaining the
fair market value thereof, shall cause the proceeds therefrom, to the extent
sufficient therefor, to be applied and distributed as provided in Section 7.5.
7.4 ORDER OF PAYMENT OF LIABILITIES UPON DISSOLUTION. After
determining that all known debts and liabilities of the Company, including all
contingent, conditional or unmatured liabilities of the Company, in the process
of winding-up, including, without limitation, debts and liabilities to the Sole
Member in the event it is a creditor of the Company to the extent otherwise
permitted by law, have been paid or adequately provided for, the remaining
assets shall be distributed in cash or in kind to the Sole Member.
7.5 LIMITATIONS ON PAYMENTS MADE IN DISSOLUTION. Except as
otherwise specifically provided in this Agreement, the Sole Member shall only be
entitled to look solely to the assets of Company for the return of its positive
Capital Account balance and shall have no recourse for its Capital Contribution
and/or share of net income (upon dissolution or otherwise) against any of the
Independent Manager or the Management Committee.
7.6 LIMITATION ON LIABILITY. Except as otherwise provided by the
Act, the debts, obligations and liabilities of the Company, whether arising in
contract, tort or otherwise, shall be solely the debts, obligations and
liabilities of the Company, and no Member or Manager shall be obligated
personally for any such debt, obligation or liability of the Company solely by
reason of being a Member or a Manager.
ARTICLE 8
TRANSFER AND ASSIGNMENT
8.1. TRANSFER OF MEMBERSHIP INTERESTS.
(a) The Sole Member may transfer its Membership Interest, but the
transferee shall not be admitted as a Member except in accordance with SECTION
8.2. Until the transferee is admitted as a Member, the Sole Member shall
continue to be the sole member of the Company and to be entitled to exercise any
rights or powers of a Member of the Company with respect to the Membership
Interest transferred.
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(b) Any purported transfer of any Membership Interest in violation of
the provisions of this Agreement shall be wholly void and shall not effectuate
the transfer contemplated thereby. Notwithstanding anything contained herein to
the contrary, the Sole Member may not transfer any Membership Interest in
violation of any provision of this Agreement or in violation of any applicable
Federal or state securities laws.
8.2. ADMISSION OF TRANSFEREE AS MEMBER. A transferee of a Membership
Interest desiring to be admitted as a Member must execute a counterpart of, or
an agreement adopting, this Agreement and shall not be admitted without the
unanimous affirmative vote of the Management Committee, which vote must include
the affirmative vote of the Independent Manager. Upon admission of the
transferee as a Member, the transferee shall have, to the extent of the
Membership Interest transferred, the rights and powers and shall be subject to
the restrictions and liabilities of the Sole Member under this Agreement and the
Act. The transferee shall also be liable, to the extent of the Membership
Interest transferred, for the unfulfilled obligations, if any, of the transferor
Member to make Capital Contributions, but shall not be obligated for liabilities
unknown to the transferee at the time such transferee was admitted as a Member
and that could not be ascertained from this Agreement. Whether or not the
transferee of a Membership Interest becomes a Member, the Sole Member is not
released from any liability to the Company under this Agreement or the Act.
ARTICLE 9
GENERAL PROVISIONS
9.1 NOTICES. All notices, offers or other communications required
or permitted to be given pursuant to this Agreement shall be in writing and may
be personally served or sent by United States mail and shall be deemed to have
been given when delivered in person or three business days after deposit in
United States mail, registered or certified, postage prepaid, and properly
addressed, by or to the appropriate party. For purposes of this Section 9.1,
the addresses of the parties hereto shall be as set forth on EXHIBIT A hereto.
The address of any party hereto may be changed by a notice in writing given in
accordance with the provisions of this Section 9.1.
9.2 CONTROLLING LAW. This Agreement and all questions relating to
its validity, interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be governed by
and construed in accordance with the laws of the State of Delaware,
notwithstanding any conflict-of-laws doctrines of such state or other
jurisdiction to the contrary.
9.3 EXECUTION OF COUNTERPARTS. This Agreement may be executed in
any number of counterparts, each of which shall be deemed to be an original as
against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signatures of all of the parties reflected hereon as the
signatories.
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9.4 SEVERABILITY. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.
9.5 ENTIRE AGREEMENT. This Agreement contains the entire
understanding among the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements and
understandings, inducements or conditions, express or implied, oral or written,
except as herein contained.
9.6 AMENDMENTS TO ORGANIZATIONAL DOCUMENTS.
(a) The power to alter, amend or repeal this Agreement shall be only
on the consent of the Sole Member, PROVIDED, that the Company shall not adopt a
new Limited Liability Company Agreement or alter, amend or repeal any provision
of Sections 2.3, 2.6, 2.7, 3.2, 6.2, 7.1, 8.2 , 9.6 and 9.11 of this Agreement
without the unanimous affirmative vote of the Management Committee, which vote
must include the affirmative vote of the Independent Manager.
(b) The Company's power to alter, amend or repeal the Certificate
shall be vested in the Sole Member; PROVIDED, that the Company shall not amend,
alter, change or repeal any provision of the Restricted Articles (as defined in
the Certificate) without the unanimous affirmative vote of the Management
Committee, which vote must include the affirmative vote of the Independent
Manager; and PROVIDED, FURTHER, that the Company shall not amend or change any
provision of any article of the Certificate other than the Restricted Articles
so as to be inconsistent with the Restricted Articles. Upon obtaining the
approval of any amendment, supplement or restatement as to the Certificate, the
Company shall cause a Certificate of Amendment or Amended and Restated
Certificate to be prepared, executed and filed in accordance with the Act.
9.7 PARAGRAPH HEADINGS. The paragraph headings in this Agreement
are for convenience and they form no part of this Agreement and shall not affect
its interpretation.
9.8 GENDER, ETC. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context indicates is appropriate. The term "including" shall mean
"including, but not limited to."
9.9 NUMBER OF DAYS. In computing the number of days (other than
Business Days) for purposes of this Agreement, all days shall be counted,
including Saturdays, Sundays and holidays; PROVIDED, HOWEVER, that if the final
day of any time period falls on a Saturday, Sunday or holiday on which national
banks are or may elect to be closed, then the final day shall be deemed to be
the next day which is not a Saturday, Sunday or such holiday.
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9.10 ASSURANCES. The Sole Member shall hereafter execute and
deliver such further instruments and do such further acts and things as may be
reasonably required or useful to carry out the intent and purpose of this
Agreement and as are not inconsistent with the terms hereof.
9.11 ENFORCEMENT BY INDEPENDENT MANAGER. Notwithstanding any other
provision of this Agreement, the Sole Member agrees that this Agreement,
(including without limitation, Sections 2.3, 2.6, 2.7, 3.2, 6.2, 7.1, 8.2, 9.6
and 9.11) constitutes a legal, valid and binding agreement of the Sole Member,
and is enforceable against the Sole Member by the Independent Manager in
accordance with its terms. The Independent Manager is an intended beneficiary
of this Agreement.
ARTICLE 10
INDEMNIFICATION
10.1 INDEMNIFICATION. Subject to Section 10.3 of this Article, the
Company shall indemnify any person who was or is a party or is threatened to be
made a party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the Company) by reason of the fact that he is or was a
manager, officer, employee or agent of the Company, or is or was serving at the
request of the Company as a manager, director, officer, employee or agent of
another company, partnership, joint venture, trust or other enterprise, against
expenses (including attorneys' fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a
plea of NOLO CONTENDERE or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
10.2 INDEMNIFICATION FOR SUITS BY OR IN RIGHT OF COMPANY. Subject to
Section 10.3 of this Article, the Company shall indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the Company to procure a judgment
in its favor by reason of the fact that he is or was a manager, officer,
employee or agent of the Company, or is or was serving at the request of the
Company as a manager, director, officer, employee or agent of another company,
partnership, joint venture, trust or other enterprise against expenses
(including attorneys' fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Company; except that no indemnification shall be made in
respect of any claim, issue or matter as to which such person shall have been
adjudged to be liable to the Company unless and only to the extent that the
Court of
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Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
10.3 AUTHORIZATION. Any indemnification under this Article (unless
ordered by a court) shall be made by the Company only as authorized in the
specific case upon a determination that indemnification of the manager, officer,
employee or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in Section 10.1 or Section 10.2, of
this Article, as the case may be. Such determination shall be made (i) by
independent legal counsel in a written opinion or (ii) by the Sole Member. To
the extent, however, that a manager, officer, employee or agent of the Company
has been successful on the merits or otherwise in defense of any action, suit or
proceeding described above, or in defense of any claim, issue or matter therein,
he shall be indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection therewith, without the necessity of
authorization in the specific case.
10.4 GOOD FAITH. For purposes of any determination under Section
10.3 of this Article, a person shall be deemed to have acted in good faith and
in a manner he/she reasonably believed to be in or not opposed to the best
interests of the Company, or, with respect to any criminal action or proceeding,
to have had no reasonable cause to believe his/her conduct was unlawful, if the
action is based on the records or books of account of the Company or another
enterprise, or on information supplied to him by the officers of the Company or
another enterprise in the course of their duties, or on the advice of legal
counsel for the Company or another enterprise or on information or records given
or reports made to the Company or another enterprise by an independent certified
public accountant or by an appraiser or other expert selected with reasonable
care by the Company or another enterprise. The term "another enterprise" as
used in this Section 10.4 shall mean any other Company or any partnership, joint
venture, trust or other enterprise of which such person is or was serving at the
request of the Company as a manager, director, officer, employee or agent. The
provisions of this Section 10.4 shall not be deemed to be exclusive or to limit
in any way the circumstances in which a person may be deemed to have met the
applicable standard of conduct set forth in Sections 10.1 or 10.2 of this
Article, as the case may be.
10.5 COURT ACTION. Notwithstanding any contrary determination in the
specific case under Section 10.3 of this Article, and notwithstanding the
absence of any determination thereunder, any manager, officer, employee or agent
may apply to any court of competent jurisdiction in the State of Delaware for
indemnification to the extent otherwise permissible under Sections 10.1 and 10.2
of this Article. The basis of such indemnification by a court shall be a
determination by such court that indemnification of the manager, officer,
employee or agent is proper in the circumstances because he has met the
applicable standards of conduct set forth in Section 10.1 and 10.2 of this
Article, as the case may be. Notice of any application for indemnification
pursuant to this Section 10.5 shall be given to the Company promptly upon the
filing of such application.
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10.6 EXPENSES. Expenses incurred in defending or investigating a
threatened or pending action, suit or proceeding may be paid by the Company in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of the manager, officer, employee or agent to
repay such amount if it shall ultimately be determined that he is not entitled
to be indemnified by the Company as authorized in this Article.
10.7 NON-EXCLUSIVITY. The indemnification and advancement of
expenses provided by or granted pursuant to this Article shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be entitled under any by-law, agreement, contract,
vote or pursuant to the direction (howsoever embodied) of any court of competent
jurisdiction or otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, it being the policy of the
Company that indemnification of the persons specified in Sections 10.1 and 10.2
of this Article shall be made to the fullest extent permitted by law. The
provisions of this Article shall not be deemed to preclude the indemnification
of any person who is not specified in Section 10.1 or 10.2 of this Article but
who the Company has the power of obligation to indemnify under the provisions of
the Act, or otherwise.
10.8 INSURANCE. The Company may purchase and maintain insurance on
behalf of any person who is or was a manager, officer, employee or agent of the
Company, or is or was serving at the request of the Company as a manager,
director, officer, employee or agent of another company, partnership, joint
venture, trust or other enterprise against any liability asserted against
him/her and incurred by him/her in any such capacity, or arising out of his/her
status as such, whether or not the Company would have the power or the
obligation to indemnify him/her against such liability under the provisions of
this Article.
10.9 CONSOLIDATION/MERGER. For purposes of this Article, references
to "the Company" shall include, in addition to the resulting Company, any
constituent Company (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had the power and authority to indemnify its managers, directors, officers,
and employees or agents, so that any person who is or was a manager, director,
officer, employee or agent of such constituent Company, or is or was serving at
the request of such constituent Company as a manager, director, officer,
employee or agent of another Company, partnership, joint venture, trust or other
enterprise, shall stand in the same position under the provisions of this
Article with respect to the resulting or surviving Company as he would have with
respect to such constituent Company if its separate existence had continued.
10.10 HEIRS, EXECUTORS, AND ADMINISTRATORS. The indemnification and
advancement of expenses provided by, or granted pursuant to, this section shall,
unless otherwise provided when authorized or ratified, continue as to a person
who has ceased to be a manager, director, office, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person.
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IN WITNESS WHEREOF, the Sole Member hereto have executed this
Agreement or caused this Agreement to be executed on its behalf as of the date
first above written.
COMMONWEALTH EDISON COMPANY
By: /s/ ▇▇▇▇ ▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇ ▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice-President and Treasurer
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EXHIBIT A
NOTICE ADDRESS OF SOLE MEMBER
Name of Member Notice Address
-------------- --------------
Commonwealth Edison Company ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Treasury Department
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EXHIBIT B
MANAGEMENT AGREEMENT
August ___, 1998
ComEd Funding, LLC
c/o Commonwealth Edison Company
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Management Agreement --
ComEd Funding, LLC
-----------------------
Ladies and Gentlemen:
For good and valuable consideration, each of the undersigned persons,
who have been designated as members of the management committee of ComEd
Funding, LLC, a Delaware limited liability company (the "Company"), in
accordance with the Limited Liability Company Agreement of the Company, dated as
of July 21, 1998, as it may be amended or restated from time to time (the "LLC
Agreement"), hereby agree:
1. To accept such person's rights and authority as a member of
the Management Committee (as defined in the LLC Agreement) under the LLC
Agreement and to perform and discharge such person's duties and obligations as a
member of the Management Committee under the LLC Agreement and agrees that such
rights, authority, duties and obligations under the LLC Agreement shall continue
until such person's successor as a member of the Management Committee is
designated or until such person's resignation or removal as a member of the
Management Committee in accordance with the LLC Agreement. A member of the
Management Committee is designated as a "manager" of the Company within the
meaning of the Delaware Limited Liability Company Act.
2. THIS MANAGEMENT AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, AND ALL RIGHTS AND
REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAWS.
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IN WITNESS WHEREOF, the undersigned have executed this Management
Agreement as of the day and year first above written.
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Name:
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Name:
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Name:
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Name:
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Name:
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