AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
OF
CINERGY RECEIVABLES COMPANY LLC
DATED AS OF MARCH 31, 2002
This Amended and Restated Limited Liability Company Agreement of Cinergy
Receivables Company LLC (this "Agreement") is entered into by Cinergy Corp., a
Delaware corporation, as the sole member and the sole holder of an equity
interest. Capitalized terms used and not otherwise defined herein have the
meanings set forth on Schedule A hereto.
The Member, by execution of this Agreement, (i) hereby forms the Company as
a limited liability company pursuant to and in accordance with the Delaware
Limited Liability Company Act (6 Del. C.ss.ss.18-101 et seq.), as amended from
time to time (the "Act"), and this Agreement, and (ii) hereby agrees as follows:
Section 1. Name.
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The name of the limited liability company formed hereby is Cinergy
Receivables Company LLC.
Section 2. Principal Business Office.
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The principal business office of the Company shall be located at ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
Section 3. Registered Office.
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The address of the registered office of the Company in the State of
Delaware is The Corporation Trust Company, Corporation Trust Center, ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 4. Registered Agent.
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The name and address of the registered agent of the Company for service of
process on the Company in the State of Delaware is The Corporation Trust
Company, Corporation Trust Center, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 5. Member.
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(a) The mailing address of the Member is set forth on Schedule B attached
hereto.
(b) Subject to Section 10(k), the Member may act by written consent.
(c) The Company shall be authorized to issue a single class of Limited
Liability Company Interest (as defined in the Act, the "Interest") that shall
not be certificated, and shall include any and all benefits to which the holder
of such Interest may be entitled in this Agreement, together with all
obligations of such person to comply with the terms and provisions of the
Agreement.
(d) In the event there is more than one member, each member's Interest in
the Company shall be expressed as a percentage equal to the ratio on any date of
such member's capital account (such capital accounts to be determined after
giving effect to all contributions of property or money, distributions or
allocations for all periods ending on or prior to such date) on such date to the
aggregate capital accounts of all members on such date ("Percentage Interest").
If there is only one member, its Percentage Interest shall be 100% for purposes
of this Agreement.
(e) At any time that there is more than one member, a capital account shall
be maintained for each member, to which contributions and profits shall be
credited, and against which distributions and losses shall be charged. Such
capital accounts shall be maintained in accordance with tax accounting
principles prescribed by the Treasury Regulations (the "Allocation Regulations")
promulgated under Section 704 of the Internal Revenue Code of 1986, as amended
(the "Code"), so that the tax allocations provided in this Agreement shall, to
the extent possible satisfy the "alternate economic effect test" within the
meaning of the Allocation Regulations.
(f) The profits and losses of the Company shall be allocated entirely to
the Member or, if additional members are admitted, to the members in proportion
to their respective Percentage Interests.
(g) The distributions of the Company shall be distributed entirely to the
Member, or if additional members are admitted, to the members in proportion to
their respective Percentage Interests.
(h) Meetings of the Member may be called at any time by any member. Except
as provided by law, if there shall be more than one member of the Company, a
majority of Percentage Interests of the Company, entitled to vote at a meeting
shall constitute a quorum at all meeting of the members, or if there is only one
member of the Company, such member shall constitute a quorum.
(i) Except as specifically set forth herein, any matter requiring the vote
of the Member shall require an affirmative vote by a majority of the Percentage
Interests of the members in order to constitute an act of the members.
Section 6. Certificates.
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇., is hereby designated as an "authorized person"
within the meaning of the Act, and has executed, delivered and filed the
Certificate of Formation of the Company with the Secretary of State of the State
of Delaware. Upon the filing of the Certificate of Formation with the Secretary
of State of the State of Delaware, his powers as an "authorized person" ceased,
and the Member thereupon became the designated "authorized person" and shall
continue as the designated "authorized person" within the meaning of the Act.
The Member or an Officer shall execute, deliver and file any other certificates
(and amendments and/or restatements thereof) necessary for the Company to
qualify to do business in Ohio and in any other jurisdiction in which the
Company may wish to conduct business.
Section 7. Purposes.
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Company is intended to and shall operate and function as a Qualified
Special Purpose Entity ("QSPE") as that term is defined in the Statement of
Financial Accounting Standards No. 140 ("FASB 140"). In order to satisfy the
requirements of FASB 140 for QSPEs, the nature of the business or purposes to be
conducted or promoted by the Company are limited solely to the following:
(a) to purchase or otherwise acquire from time to time any or all right,
title and interest in, to and under any obligation, whether now or hereafter
acquired, of any obligor to pay the Cincinnati Gas & Electric Company, an Ohio
corporation ("CG&E), PSI Energy, Inc. ("PSI"), an Indiana corporation, or The
Union Light, Heat and Power Company, a Kentucky corporation ("ULHP") for
merchandise sold or services rendered by CG&E, PSI, or UHLP in a retail
transaction, including the rights of CG&E, PSI or ULHP to payment of any
interest or finance charges, and in the contracts relating to such obligations,
all security interests, guaranties and property securing or supporting payment
of such obligations, all books and records relating to such obligations, and all
proceeds of the foregoing, but shall not include any obligation of any obligor
to pay for merchandise sold or services rendered on a wholesale basis by CG&E,
PSI or ULHP (collectively, "Receivables"), and to enter into any related
agreements with any Affiliates or any other Person or Persons;
A "retail transaction" is one (i) (a) in which the merchandise sold or the
services rendered are sold or rendered to a residential, commercial, industrial,
public street and highway lighting, or public authority customer or any
successor type of customer to the aforementioned customer, or (b) which arose
from a bona fide sale of merchandise or insurance or the rendering of services
accepted by the obligor of that receivable (including with respect to CG&E, a
receivable which arose from the joint ownership arrangements between and/or
among CG&E, Dayton Power & Light Co. and/or Columbus Southern Power Co. relating
to certain jointly owned generating stations), and (ii) which does not result in
the customer being obliged to pay for such merchandise or services under a
Percentage of Increase Payment Plan.
(b) pursuant to the Purchase and Sale Agreement or the Receivables Loan
Agreements identified in Section 7(d) hereof, to purchase, acquire, own, hold,
service, process, settle, collect, ▇▇▇▇▇ ▇ ▇▇▇▇ on, assign, pledge and otherwise
deal with the Receivables and any undivided interests in the Receivables,
collateral securing the Receivables and any proceeds or further rights
associated with any of the foregoing and to enter into any related agreements
with third parties or any other Person or Persons;
(c) to manage and service the Receivables pursuant to one or more
agreements to be entered into by and among, among others, the Company and any
Person or Persons acting as servicer or collection agent of the Receivables;
(d) to enter into the Amended and Restated Purchase and Sale Agreement
dated as of March 31, 2002 among the Company and the Originators ("Purchase and
Sale Agreement"), and the Receivables Loan Agreement dated as of February 14,
2002 among the Company, The Cincinnati Gas & Electric Company, as Collection
Agent, Windmill Funding Corporation and Jupiter Securitization Corporation, as
Lenders, ABN AMRO Bank N.V., as a Servicing Agent and as Administrative Agent,
and Bank One, NA, as a Servicing Agent, and the Receivables Loan Agreement dated
as of February 14, 2002 among The Cincinnati Gas & Electric Company, as
Collection Agent, Bank One, NA, as a Committed Lender and ABN AMRO Bank N.V., as
a Committed Lender and as Administrative Agent and each other agreement,
instrument, promissory note, certificate, Uniform Commercial Code financing
statement or document contemplated by such Purchase and Sale Agreement or such
Receivables Loan Agreement, and any amendment, amendment and restatement or
other modification of such Purchase and Sale Agreement, Receivables Loan
Agreement, other agreement, instrument, promissory note, certificate, Uniform
Commercial Code financing statement or document;
(e) to borrow funds pursuant to either such Receivables Loan Agreements and
issue evidences of indebtedness in respect thereof, and to grant security
interests in Receivables to secure its obligations under either of such
Receivables Loan Agreements, but only to pay the purchase price of Receivables
purchased under the Purchase and Sale Agreement or to reduce any outstanding
amounts owing under the Subordinated Notes payable by the Company to the
Originator under the Purchase and Sale Agreement and to secure such borrowings
and indebtedness, as well as obligations incurred by the Company in connection
therewith with (and pledge and grant liens on and security interests in) assets
acquired from time to time by the Company and by other assets and properties
which the Company owns from time to time or in which it otherwise has a right,
title or interest;
(f) to carry out all of its obligations and exercise all of its rights
under the agreements, instruments, promissory notes, certificates, financing
statements or documents set forth in Section 7(e);
(g) to engage in any lawful act or activity and to exercise any powers
permitted to limited liability companies organized under the laws of the State
of Delaware that, in either case, are incidental to and necessary or convenient
for the accomplishment of the above-mentioned purposes; and
(h) the purposes of the Company shall not be significantly changed without
the prior written consent of each person or entity that holds a beneficial
interest, as that term is defined in FASB 140 ("Beneficial Interests") or, in or
pledged by the Company.
Section 8. Powers.
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Subject to any limitations set forth in this Agreement, including but not
limited to those set forth in Section 10(k), the Company, and the Board of
Managers and the Officers of the Company on behalf of the Company, shall have
and exercise all powers necessary, convenient or incidental to accomplish its
purposes as set forth in Section 7.
Section 9. Limitation on Purpose and Powers.
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Notwithstanding the above enumerated purposes and powers, the Company is
intended to qualify and conduct business as a QSPE and any purposes or powers
stated above that are contrary to the following limited purposes and powers
shall be null and void and of no effect:
(a) The Company may hold only:
(i) financial assets transferred to it that are passive in nature;
(ii) passive derivative financial instruments pertaining to Beneficial
Interests as defined in FASB 140, other than another derivative financial
instrument, that is issued or sold to parties other than a transferor of
assets to the Company or such transferor's affiliates or agents;
(iii) financial assets, such as guarantees or rights to collateral,
that are intended to reimburse the Company if financial assets transferred
to the Company are not adequately serviced by third-parties or if such
third parties fail to timely pay obligations due to the Company and that
the Company entered into when it was established, when assets were
transferred to it, or when Beneficial Interests, other than derivative
financial instruments, were issued by the Company;
(iv) servicing rights related to the financial assets that it holds;
(v) temporarily, nonfinancial assets obtained in connection with the
collection of financial assets that the Company holds; and
(vi) cash that is collected from assets that it holds and investments
purchased with such cash pending distribution to the holders of the
Company's Beneficial Interests so long as such investments are appropriate
for such purpose such as money market or other relatively risk-free
instruments without options and with maturities no later than the expected
distribution date.
(b) The Company may only sell or otherwise dispose of noncash financial
assets in automatic response to one of the following conditions:
(i) the occurrence of an event or circumstance that (a) is specified
in this agreement or the agreements that create the Beneficial Interests in
the transferred assets that the Company holds; (b) is outside the control
of a transferor of assets to the Company or such transferor's affiliates or
agents; and (c) causes, or is expected at the date of transfer to cause,
the fair value of those financial assets to decline by a specified degree
below the fair value of such assets when the Company obtained them;
(ii) exercise by a holder of the Beneficial Interests of the Company,
that is an entity other than a transferor of assets to the Company or such
transferor's affiliates or agents, of its right to put its beneficial
interest back to the Company;
(iii) exercise by a transferor of assets to the Company of a call or
removal-of-accounts provision specified in this agreement, an agreement
transferring assets to the Company, or an agreement creating the Beneficial
Interests in the transferred assets that the Company holds; and
(iv) termination of the Company or maturity of the Beneficial
Interests in the financial assets of the Company on a fixed or determinable
date that is specified at the inception of the Company.
Section 10. Management.
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(a) Board of Managers. Subject to Section 10(k), the business and affairs
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of the Company shall be managed, by or under the direction of, a board of three
(3) Managers. Each Manager elected, designated or appointed shall hold office
until a successor is elected and qualified or until such Manager's earlier
death, resignation, expulsion, incapacity or removal. Managers need not be a
Member. The Managers shall be ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, of whom two (2) shall be the Independent Managers, as defined below.
(b) Independent Managers. At all times, at least two Managers (the
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"Independent Managers" and individually, an "Independent Manager") of the
Company shall be persons who meet the following criteria:
(i) Has at least five (5) years of business, legal, financial, or
other equivalent experience;
(ii) Is not, and during the three (3) years prior to being designated
as an Independent Manager has not been, any of the following:
(A) A customer or supplier of any member of the Parent Group as
defined in Section 10(k) below);
(B) A shareholder (whether direct, indirect, or beneficial)
holding more than one percent (1%) of the outstanding stock of any
member of the Parent Group;
(C) An officer or employee of any member of the Parent Group;
(D) Engaged in any business transaction or series of business
transactions for profit (including banking, legal, or consulting
services) involving more than Ten Thousand Dollars ($10,000) with any
member of the Parent Group; or
(E) An Affiliate, executive officer, general partner, or member
of the immediate family of any person that had the status or engaged
in a transaction described in any of the above subparagraphs; and
(iii) Does not propose to, and will not, while an Independent Manager
of the Company, enter into a relationship or transaction described in
subsection (ii) above.
If an Independent Manager dies, resigns, is expelled, becomes incapacitated or
is removed, or such position is otherwise vacant, no action requiring the
unanimous vote of the Board of Managers of the Company shall be taken
(including, without limitation, any action pursuant to Section 20) until a
successor Independent Manager is elected and qualified and approves of such
action. In the event of the death, resignation, expulsion, incapacity or removal
of an Independent Manager, or a vacancy for any other reason, a successor
Independent Manager shall be appointed by the remaining Managers. An Independent
Manager, in voting on matters subject to the approval of the Board of Managers
of the Company, shall at all times take into account the interests of creditors
of the Company, in addition to the interests of the Company itself. No
Independent Manager may be removed for any reason unless his or her successor
has been appointed.
(c) Powers. Subject to Section 10(k), the Board of Managers shall have the
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power to do any and all acts necessary, convenient or incidental to or for the
furtherance of the purposes described herein, except for those powers reserved
to the members by this Agreement or the Act. Subject to Section 7, the Board of
Managers has the authority to bind the Company.
(d) Meeting of the Board of Managers. The Board of Managers may hold
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meetings, both regular and special, within or outside the State of Delaware.
Regular meetings of the Board of Managers may be held without notice at such
time and at such place as shall from time to time be determined by the Board of
Managers. Special meetings of the Board of Managers may be called only by a
majority of the Managers or the President on not less than one day's notice to
each Manager by telephone, facsimile, mail, telegram, courier, personal delivery
or any other means of communication.
(e) Quorum; Acts of the Board of Managers. At all meetings of the Board of
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Managers, a majority of the Managers shall constitute a quorum for the
transaction of business and, except as otherwise provided in any other provision
of this Agreement, the act of a majority of the Managers present at any meeting
at which there is a quorum shall be the act of the Board of Managers. If a
quorum shall not be present at any meeting of the Board of Managers, the
Managers present at such meeting may adjourn the meeting from time to time,
without notice other than announcement at the meeting, until a quorum shall be
present. Any action required or permitted to be taken at any meeting of the
Board of Managers or of any committee thereof may be taken without a meeting if
all members of the Board of Managers or committee, as the case may be, consent
thereto in writing, and the writing or writings are filed with the minutes of
proceedings of the Board of Managers or committee, as the case may be.
(f) Electronic Communications. Members of the Board of Managers, or any
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committee designated by the Board of Managers, may participate in meetings of
the Board of Managers, or any committee, by means of telephone conference or
similar communications equipment that allows all persons participating in the
meeting to hear each other, and such participation in a meeting shall constitute
presence in person at the meeting. If all the participants are participating by
telephone conference or similar communications equipment, the meeting shall be
deemed to be held at the principal place of business of the Company.
(g) Committees of Managers.
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(i) The Board of Managers may, by resolution passed by a majority of
the whole Board of Managers, designate one or more committees, each
committee to consist of one or more of the Managers of the Company. The
Board of Managers may designate one or more Managers as alternate members
of any committee, who may replace any absent or disqualified member at any
meeting of the committee.
(ii) In the absence or disqualification of a member of a committee,
the member or members thereof present at any meeting and not disqualified
from voting, whether or not such members constitute a quorum, may
unanimously appoint another member of the Board of Managers to act at the
meeting in the place of any such absent or disqualified member.
(iii) Any such committee, to the extent provided in the resolution of
the Board of Managers, shall have and may exercise all the powers and
authority of the Board of Managers in the management of the business and
affairs of the Company. Such committee or committees shall have such name
or names as may be determined from time to time by resolution adopted by
the Board of Managers. Each committee shall keep regular minutes of its
meetings and report the same to the Board of Managers when required.
(h) Compensation of Managers; Expenses. The Board of Managers shall have
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the authority to fix the compensation of Managers. The Managers may be paid
their expenses, if any, of attendance at meetings of the Board of Managers,
which may be a fixed sum for attendance at each meeting of the Board of Managers
or a stated salary as Manager. No such payment shall preclude any Manager from
serving the Company in any other capacity and receiving compensation therefor.
Members of special or standing committees may be allowed like compensation for
attending committee meetings.
(i) Removal of Managers. Unless otherwise restricted by law and subject to
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Section 10(b) hereof, any Manager (including an Independent Manager) or the
entire Board of Managers may be removed or expelled, with or without cause, at
any time by the Member, and any vacancy caused by any such removal or expulsion
may be filled by action of the Member.
(j) Managers as Agents. To the extent of their powers set forth in this
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Agreement and subject to Section 10(k), the Managers are agents of the Company
for the purposes of the Company's business, and the actions of the Managers
taken in accordance with such powers set forth in this Agreement shall bind the
Company.
(k) Separateness Covenants. This Section 10(k) is being adopted in order to
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comply with certain provisions required in order to qualify the Company as a
QSPE.
The Company shall:
(i) ensure that at all times at least ten percent (10%) of the fair
value of its Beneficial Interests are held by parties other than a
transferor of assets to the Company or such transferor's affiliates or
agents;
(ii) not commingle its assets with those of any member of the Parent
Group or any Affiliate or subsidiary of any member of the Parent Group
(except for the temporary commingling of collections of the Receivables as
specifically provided in the agreements under which the Company effects the
transactions with respect to the Receivables contemplated by clauses (a)
through and including (d) of Section 7);
(iii) maintain (A) correct and complete books and records and minutes
of the meetings and the other proceedings of the Member and the Board of
Managers and (B) such records, books and minutes separate from those of any
member of the Parent Group;
(iv) have its own principal executive and administrative office
through which its business is conducted (which, however, may be within the
premises of and leased from any member of the Parent Group) separate from
those of any Originator;
(v) maintain books and records separate from any other Person;
(vi) conduct its own affairs in its own name;
(vii) maintain and periodically prepare separate financial statements;
(viii) pay its own liabilities out of its own funds;
(ix) observe all organizational formalities, including holding
appropriate meetings in connection with the activities of the Member as
required by the Act, the Certificate of Formation or this Agreement;
(x) maintain an "arm's-length relationship" with each member of the
Parent Group;
(xi) pay the salaries, if any, of its own Officers and employees, if
any;
(xii) comply at all times with the limitations and requirements of
Section 9.
(xiii) not guarantee or become obligated for the debts of any other
Person or hold out its credit as being available to satisfy the obligations
of others;
(xiv) maintain separate office space and allocate fairly and
reasonably any overhead for office space shared with any member of the
Parent Group;
(xv) use stationery, invoices and checks through which all business
correspondence and communication are conducted separate from those of any
member of the Parent Group;
(xvi) not pledge its assets for the benefit of any other Person except
pursuant to the purposes and activities contemplated by Section 7;
(xvii) hold itself out as a separate entity;
(viii) not engage, directly or indirectly, in any business or purposes
other than the actions required or permitted to be performed under Section
7 and Section 10(k);
(xix) not engage in any merger, consolidation or combination
transaction with any Person;
(xx) not take any action inconsistent with Section 20; and
(xxi) not incur debt except pursuant to the purposes and activities
contemplated by Section 7.
(xxii) not significantly change the purposes of the Company without
the prior written consent of each person or entity that holds Beneficial
Interests in, or pledged by, the Company.
This Section 10(k) shall not limit the obligations of the Company under
Section 19(b). The Member shall not amend, alter, change or repeal the
definition of "Independent Managers" or Sections 7, 8, 10(b), 10(k), 19(c), 20
or 29 or this paragraph of this Agreement without the unanimous written consent
of the Board of Managers (including both Independent Managers). Subject to this
Section 10(k), the Member reserves the right to amend, alter, change or repeal
any provisions contained in this Agreement in accordance with Section 29.
For purposes hereof, "Parent Group" shall mean (A) Cinergy Corp., (B) each
Person that, directly or indirectly, owns or Controls, whether beneficially, or
as a trustee, guardian or other fiduciary, stock having ten percent (10%) or
more of the voting power in the election of directors of Cinergy Corp., (C) each
Person that Controls, is Controlled by or is under common Control with Cinergy
Corp, including specifically the Originators and (D) each of such Person's
officers, directors, joint venturers and partners.
Section 11. Officers.
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(a) Officers. The initial Officers of the Company shall be chosen by the
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Member and shall consist of at least a President, a Secretary and a Treasurer.
The Officers of the Company may also include one or more Vice Presidents,
Assistant Secretaries and Assistant Treasurers. Any number of offices may be
held by the same person. Upon and after the establishment of the Board of
Managers, the Board of Managers may appoint such other Officers and agents as it
shall deem necessary or advisable who shall hold their offices for such terms
and shall exercise such powers and perform such duties as shall be determined
from time to time by the Board of Managers. The salaries of all Officers and
agents of the Company shall be fixed by or in the manner prescribed by the Board
of Managers. The Officers of the Company shall hold office until their
successors are chosen and qualified. Any Officer initially appointed by the
Member or at any time elected or appointed by the Board of Managers may be
removed at any time, with or without cause, by the affirmative vote of a
majority of the Board of Managers. Any vacancy occurring in any office of the
Company shall be filled by the Board of Managers.
(b) President. The President shall be the chief executive officer of the
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Company, shall preside at all meetings of the Board of Managers, shall be
responsible for the general and active management of the business of the Company
and shall see that all orders and resolutions of the Board of Managers are
carried into effect. The President or any other Officer authorized by the
President or the Board of Managers shall execute all bonds, mortgages and other
contracts, except: (i) where required or permitted by law or this Agreement to
be otherwise signed and executed; (ii) where signing and execution thereof shall
be expressly delegated by the Board of Managers to some other Officer or agent
of the Company; and (iii) as otherwise permitted in Section 11(c).
(c) Vice President. In the absence of the President or in the event of the
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President's inability to act, the Vice President, if any (or in the event there
be more than one Vice President, the Vice Presidents in the order designated by
the Managers, or in the absence of any designation, then in the order of their
election), shall perform the duties of the President, and when so acting, shall
have all the powers of and be subject to all the restrictions upon the
President. The Vice Presidents, if any, shall perform such other duties and have
such other powers as the Board of Managers may from time to time prescribe.
(d) Secretary and Assistant Secretary. The Secretary shall be responsible
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for filing legal documents and maintaining records for the Company. The
Secretary shall attend all meetings of the Board of Managers and record all the
proceedings of the meetings of the Company and of the Board of Managers in a
book to be kept for that purpose and shall perform like duties for the standing
committees when required. The Secretary shall give, or shall cause to be given,
notice of all meetings of the Member, if any, and special meetings of the Board
of Managers, and shall perform such other duties as may be prescribed by the
Board of Managers or the President, under whose supervision the Secretary shall
serve. The Assistant Secretary, or if there be more than one, the Assistant
Secretaries in the order determined by the Board of Managers (or if there be no
such determination, then in order of their election), shall, in the absence of
the Secretary or in the event of the Secretary's inability to act, perform the
duties and exercise the powers of the Secretary and shall perform such other
duties and have such other powers as the Board of Managers may from time to time
prescribe.
(e) Treasurer and Assistant Treasurer. The Treasurer shall have the custody
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of the Company funds and securities and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the Company and shall deposit
all moneys and other valuable effects in the name and to the credit of the
Company in such depositories as may be designated by the Board of Managers. The
Treasurer shall disburse the funds of the Company as may be ordered by the Board
of Managers, taking proper vouchers for such disbursements, and shall render to
the President and to the Board of Managers, at its regular meetings or when the
Board of Managers so requires, an account of all of the Treasurer's transactions
and of the financial condition of the Company. The Assistant Treasurer, or if
there shall be more than one, the Assistant Treasurers in the order determined
by the Board of Managers (or if there be no such determination, then in the
order of their election), shall, in the absence of the Treasurer or in the event
of the Treasurer's inability to act, perform the duties and exercise the powers
of the Treasurer and shall perform such other duties and have such other powers
as the Board of Managers may from time to time prescribe.
(f) Officers as Agent. The Officers, to the extent of their powers set
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forth in this Agreement or otherwise vested in them by action of the Board of
Managers not inconsistent with this Agreement, are agents of the Company for the
purpose of the Company's business and, subject to Section 10(k), the actions of
the Officers taken in accordance with such powers shall bind the Company.
(g) Duties of Board of Managers and Officers. Except to the extent
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otherwise specifically provided herein, each Manager and Officer shall have a
fiduciary duty of loyalty and care similar to that of directors and officers of
business corporations organized under the General Corporation Law of the State
of Delaware.
Section 12. Limited Liability.
------------------
No Member, Officer, Manager or employee of the Company shall be obligated
personally or liable for the debts, obligations and liabilities of the Company
whether arising in contract, tort or otherwise solely by reason of being a
member or acting as an Officer, Manager or employee of the Company. 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.
Section 13. Capital Contributions.
----------------------
The Member has contributed or will contribute, to the Company property of
an agreed value as listed on Schedule B attached hereto.
Section 14. Additional Contributions.
-------------------------
The Member is not required to make any additional capital contribution to
the Company. However, the Member may make additional capital contributions to
the Company at any time upon the written consent of the Member. To the extent
that the Member makes an additional capital contribution to the Company, the
Member shall revise Schedule B of this Agreement. The provisions of this
Agreement, including this Section 14, are intended solely to benefit the Member
and, to the fullest extent permitted by law, shall not be construed as
conferring any benefit upon any creditor of the Company (and no such creditor of
the Company shall be a third-party beneficiary of this Agreement) and the Member
shall not have any duty or obligation to any creditor of the Company to make any
contribution to the Company or to issue any call for capital pursuant to this
Agreement.
Section 15. Distributions.
--------------
Distributions shall be made to the Member at the times and in the aggregate
amounts determined by the Board of Managers. Notwithstanding any provision to
the contrary contained in this Agreement, the Company shall not be required to
make a distribution to the Member on account of its interest in the Company if
such distribution would violate any provision of the Act or any other applicable
law.
Section 16. Books and Records.
------------------
The Board of Managers shall keep or cause to be kept complete and accurate
books of account and records with respect to the Company's business. The books
of the Company shall at all times be maintained by the Board of Managers. The
Member and its duly authorized representatives shall have the right to examine
the Company books, records and documents during normal business hours. The
Company, and the Board of Managers on behalf of the Company, shall not have the
right to keep confidential from the Member any information that the Board of
Managers would otherwise be permitted to keep confidential from the Member
pursuant to the Act. The Company's books of account shall be kept using the
method of accounting determined by the Member. The Company's independent
auditor, if any, shall be an independent public accounting firm selected by the
Member.
Section 17. Reports.
--------
(a) The Board of Managers shall use diligent efforts to cause to be
prepared and delivered to the Member, within 90 days after the end of each
fiscal year, an audited or unaudited report setting forth as of the end of such
fiscal year:
(i) a balance sheet of the Company;
(ii) an income statement of the Company for such fiscal year; and
(iii) a statement of the Member's capital account.
(b) The Board of Managers shall, after the end of each fiscal year, use
reasonable efforts to cause the Company's independent accountants, if any, to
prepare and transmit to the Member as promptly as possible any such tax
information as may be reasonably necessary to enable the Member to prepare its
federal, state and local income tax returns relating to such fiscal year.
Section 18. Other Business.
---------------
The Member and any Affiliate of the Member may engage in or possess an
interest in other business ventures (unconnected with the Company) of every kind
and description, independently or with others. The Company shall not have any
rights in or to such independent ventures or the income or profits therefrom by
virtue of this Agreement.
Section 19. Exculpation and Indemnification.
--------------------------------
(a) None of the Member, any Officer, Manager or employee or agent of the
Company and no employee, representative, agent, member or Affiliate of the
Member (collectively, the "Covered Persons") shall be liable to the Company or
any other Person who has an interest in or claim against the Company for any
loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Covered Person in connection with any matter arising from, or
related to, or in connection with this Agreement or the Company's business or
affairs; provided, however, that the foregoing shall not eliminate or limit the
liability of any Covered Person if a judgment or other final adjudication
adverse to the Covered Person establishes that the Covered Person's acts or
omissions were in bad faith or involved intentional misconduct or a knowing
violation of law or that the Covered Person personally gained in fact a
financial profit or other advantage to which the Covered Person was not legally
entitled.
(b) The Company shall, to the fullest extent permitted by the Act,
indemnify and hold harmless, and advance expenses to, each Covered Person
against any losses, claims, damages or liabilities to which the Covered Person
may become subject in connection with any matter arising from, related to, or in
connection with, this Agreement or the Company's business or affairs; provided,
however, that no indemnification may be made to or on behalf of any Covered
Person if a judgment or other final adjudication adverse to the Covered Person
establishes (i) that acts of the Covered Person were committed in bad faith or
were the result of active and deliberate dishonesty and were material to the
cause of action so adjudicated or (ii) that the Covered Person personally gained
in fact a financial profit or other advantage to which the Covered Person was
not legally entitled.
(c) Notwithstanding anything else contained in this Agreement, the
indemnity obligations of the Company under paragraph (b) above shall:
(i) be in addition to any liability that the Company may otherwise
have;
(ii) inure to the benefit of the successors, assigns, heirs, and
personal representatives of each Covered Person; and
(iii) be limited to funds of the Company that would otherwise be
available for distribution to the Member.
Notwithstanding any other provision of this Agreement, the Company shall not,
and shall not be obligated to, pay any amount pursuant to this Section 19 unless
the Company has received funds or has funds on hand which may be used to make
such payment and which funds are not required to repay any other obligations of
the Company when due. Any amount which the Company does not pay pursuant to the
operation of the preceding sentence shall not constitute a claim (as defined
inss.101 of the Bankruptcy Code) against, or corporate obligation of, the
Company.
(d) The foregoing provisions of this Section 19 shall survive any
termination of this Agreement and the dissolution of the Company.
Section 20. Bankruptcy Proceedings.
-----------------------
Notwithstanding any other provision of this Agreement and any provision of
law that otherwise so empowers the Company, the Company shall not (i) at any
time while the Company is not Insolvent (as defined in the Bankruptcy Code), and
(ii) at any time while the Company is Insolvent, without the prior unanimous
consent of all of the members of the Board of Managers of the Company (including
both Independent Managers), voluntarily commence any proceeding or file any
petition under any bankruptcy, insolvency, reorganization, liquidation or
similar law (including the filing of a voluntary petition under Section 301 of
the Bankruptcy Code), make an assignment for the benefit of creditors or declare
or effect a moratorium on its debt. This Section 20 may not be amended without
the unanimous consent of all of the members of the Board of Managers of the
Company.
Section 21. Restrictions on Transferability.
--------------------------------
The membership interest in the Company of the Member shall be
non-assignable and non-transferrable and may not be pledged, hypothecated or
otherwise encumbered. Any purported assignment, transfer, pledge, hypothecation
or other encumbrance of the membership interest of the Member in the Company
shall be void. The Member shall not be expelled as the Member under any
circumstances. Notwithstanding anything in this Agreement to the contrary, any
successor to the Member by merger or consolidation shall, without further act,
be the
Member hereunder, and such merger or consolidation shall not constitute an
assignment or transfer for purposes of this Agreement.
Section 22. Admission of Additional Members.
--------------------------------
One or more additional members of the Company may be admitted to the
Company with the written consent of the Member.
Section 23. Dissolution.
------------
(a) Pursuant to Section 18-801 of the Act, and subject to Section 7 herein
and this Section 23, the Company shall dissolve, and its affairs shall be wound
up, only upon the earliest to occur of any of the following events (which, in
the case of the events described in paragraph (iii) of this Section 23(a), and
in all others cases unless the Member (or a successor member or members) agrees
to continue the business of the Company after the occurrence of such event,
shall constitute a "Dissolution Event"):
(i) one year and one day following the full and indefeasible
satisfaction of all the Company's indebtedness, liabilities and other
obligations pursuant to or in connection with any agreements or instruments
entered into pursuant to Section 7(d) herein;
(ii) at any time there are no members of the Company, unless the
business of the Company is continued without dissolution in the manner
described below;
(iii) the entry of a decree of judicial dissolution under the Act; and
(iv) the sale of all or substantially all of the assets of the
Company; other than by the operation of the agreements or instruments
entered into pursuant to Section 7(d) herein.
(b) Notwithstanding any other provision in this Agreement, the bankruptcy
(as defined in section 18-101(1) and 18-304 of the Act) of the Member shall not
cause the Member to cease to be a member of the Company, and upon the occurrence
of such an event, the business of the Company shall be continued without
dissolution. The dissolution of the Member or the occurrence of any other event
that terminates the continued membership of the Member of the Company shall not
cause the Company to be dissolved or its affairs to be wound up, and upon the
occurrence of any such event, the Company shall be continued without
dissolution. To the extent such action would lead to a result inconsistent with
the provisions of this Section 23, the Member agrees not to withdraw its
interest as a member in the Company. In the event there are no members of the
Company, to the fullest extent permitted by law, the personal representative of
the Member is hereby authorized to, and shall, within 90 days after the
occurrence of the event that terminated the continued membership of the last
remaining member in the Company, agree in writing (i) to continue the Company
and (ii) to the admission of the personal representative or its nominee or
designee, as the case may be, as a substitute member of the Company, effective
as of the occurrence of the event that terminated the continued membership of
the Member in the Company.
(c) Upon liquidation, amounts in respect of the proceeds of a sale of
Company assets shall first be applied to payment of all Company debts, fees,
costs and expenses and then shall be distributed to the Member.
(d) The Company shall not be dissolved for any other reason without the
prior written consent of each person or entity that provides financing to or
otherwise holds Beneficial Interests of, in or pledged by the Company.
Section 24. Waiver of Partition; Nature of Interest.
----------------------------------------
Except as otherwise expressly provided in this Agreement, to the fullest
extent permitted by law, the Member hereby irrevocably waives any right or power
that the Member might have to cause the Company or any of its assets to be
partitioned, to cause the appointment of a receiver for all or any portion of
the assets of the Company, to compel any sale of all or any portion of the
assets of the Company pursuant to any applicable law or to file a complaint or
to institute any proceeding at law or in equity to cause the dissolution,
liquidation, winding up or termination of the Company. The Member shall not have
any interest in any specific assets of the Company, and the Member shall not
have the status of a creditor with respect to any distribution pursuant to
Section 15 hereof. The interest of the Member in the Company is personal
property.
Section 25. Benefits of Agreement; No Third-Party Rights.
---------------------------------------------
None of the provisions of this Agreement shall be for the benefit of or
enforceable by any creditor of the Company or by any creditor of the Member.
Nothing in this Agreement shall be deemed to create any right in any Person
(other than Covered Persons) not a party hereto, and this Agreement shall not be
construed in any respect to be a contract in whole or in part for the benefit of
any third Person.
Section 26. Severability of Provisions.
---------------------------
Each provision of this Agreement shall be considered severable and if for
any reason any provision or provisions herein are determined to be invalid,
unenforceable or illegal under any existing or future law, such invalidity,
unenforceability or illegality shall not impair the operation of or affect those
portions of this Agreement which are valid, enforceable and legal.
Section 27. Entire Agreement.
-----------------
This Agreement constitutes the entire agreement of the parties with respect
to the subject matter hereof.
Section 28. Governing Law.
--------------
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED UNDER THE LAWS OF THE
STATE OF DELAWARE (WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES), ALL RIGHTS
AND REMEDIES BEING GOVERNED BY SAID LAWS.
Section 29. Amendments.
-----------
Subject to Section 10(k), this Agreement may not be modified, altered,
supplemented or amended, (i) except pursuant to a written agreement executed and
delivered by the Member, and (ii) in any material respect, except with the prior
written consent of each person or entity that provides financing to or otherwise
holds Beneficial Interests of, in or pledged by the Company.
Section 30. Counterparts.
-------------
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original of this Agreement and all of which together shall
constitute one and the same instrument.
Section 31. Notices.
--------
Any notices required to be delivered hereunder shall be in writing and
personally delivered, mailed or sent by facsimile, electronic mail or other
similar form of rapid transmission, and shall be deemed to have been duly given
upon receipt (a) in the case of the Company, to the Company at its address in
Section 2, (b) in the case of the Member, to the Member at its address as listed
on Schedule B attached hereto, and (c) in the case of either of the foregoing,
at such other address as may be designated by written notice to the Company or
the Member, as the case may be.
Section 32. Effectiveness.
--------------
Pursuant to Section 18-201(d) of the Act, this Agreement shall be effective
as of the date first above written.
[Signature Follows]
IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, has
duly executed this Limited Liability Company Agreement as of the date first
above written.
MEMBER:
CINERGY CORP.
By:__________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
SCHEDULE A
Definitions
-----------
A. Definitions
-----------
When used in this Agreement, the following terms not otherwise defined
herein have the following meanings:
"Act" has the meaning set forth in the preamble to this Agreement.
-----
"Affiliate" means, with respect to any Person, any other Person directly or
-----------
indirectly Controlling or Controlled by or under direct or indirect common
Control with such Person.
"Agreement" means this Limited Liability Company Agreement of the Company,
-----------
together with the schedules attached hereto, as amended, restated or
supplemented or otherwise modified from time to time.
"Bankruptcy Code" means the provisions of title 11 of the United States
------------------
Code, 11 U.S.C.ss.ss.101 et seq., as amended from time to time.
"Beneficial Interests" has the meaning set forth in section 7(h) of this
-----------------------
Agreement
"Board of Managers" means the Board of Managers of the Company established
-------------------
pursuant to Section 10.
"Certificate of Formation" means the Certificate of Formation of the
----------------------------
Company filed with the Secretary of State of the State of Delaware on January
10, 2002, as amended or amended and restated from time to time.
"Company" means Cinergy Receivables Company LLC, a Delaware limited
---------
liability company.
"Control" means the possession, directly or indirectly, or the power to
---------
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities or general partnership or managing
member interests, by contract or otherwise. "Controlling" and "Controlled" shall
have correlative meanings. Without limiting the generality of the foregoing, a
Person shall be deemed to Control any other Person in which it owns, directly or
indirectly, a majority of the ownership interests.
"Covered Persons" has the meaning set forth in Section 19(a).
-----------------
"Managers" means the Managers elected to the Board of Managers from time to
----------
time by the Member. A Manager is hereby designated as a "manager" of the Company
within the meaning of Section 18-101(10) of the Act.
"Independent Managers" and "Independent Managers" have the meaning set
----------------------- -----------------------
forth in Section 10(b).
"Member" means Cinergy Corp., as the initial member of the Company, and
--------
includes any Person admitted as an additional member of the Company or a
substitute member of the Company pursuant to the provisions of this Agreement.
"Officer" means an officer of the Company described in Section 11.
---------
"Originators" means The Cincinnati Gas & Electric Company, PSI Energy, Inc.
-------------
and The Union Light, Heat and Power Company, each a direct or indirect
wholly-owned subsidiary of the Member.
"Parent Group" has the meaning set forth in Section 10(k).
--------------
"Person" means any individual, corporation, partnership, joint venture,
--------
limited liability company, limited liability partnership, association, joint
stock company, trust, unincorporated organization, or other organization,
whether or not a legal entity, and any governmental authority.
"Receivable" is defined in Section 7.
------------
"Stock" means all shares, options, warrants, general or limited partnership
-------
interests, membership interests, units or other equivalents (regardless of how
designated) of or in a corporation, partnership, limited liability company or
equivalent entity whether voting or nonvoting, including common stock, preferred
stock, trust certificates, membership interests or any other "equity security"
(as such term is defined in Rule 3a11-1 of the General Rules and Regulations
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934).
"Stockholder" means, with respect to any Person, each holder of Stock of
-------------
such Person.
"Subordinated Note" has the meaning set forth in Section 2.3.(b) of the
--------------------
Purchase and Sale Agreement.
B. Rules of Construction
---------------------
Definitions in this Agreement apply equally to both the singular and plural
forms of the defined terms. The words "include" and "including" shall be deemed
to be followed by the phrase "without limitation." The terms "herein," "hereof"
and "hereunder" and other words of similar import refer to this Agreement as a
whole and not to any particular Section, paragraph or subdivision. The Section
titles appear as a matter of convenience only and shall not affect the
interpretation of this Agreement. All Section, paragraph, clause, Exhibit or
Schedule references not attributed to a particular document shall be references
to such parts of this Agreement.
SCHEDULE B
Member
------
Agreed Value of Membership
Name Mailing Address Capital Contribution Interest
---- --------------- -------------------- --------
Cinergy Corp. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ $5,000,000 100%
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇