EXHIBIT 4(g)
EXECUTION VERSION
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AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of September 19, 2003
among
CONSUMERS ENERGY COMPANY,
as the Borrower,
THE FINANCIAL INSTITUTIONS NAMED HEREIN,
as the Banks,
BANK ONE, NA,
as Agent,
BARCLAYS BANK PLC,
as Syndication Agent
and
CITICORP NORTH AMERICA, INC.,
JPMORGAN CHASE BANK,
UNION BANK OF CALIFORNIA, N.A.,
as Co-Documentation Agents
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BANC ONE CAPITAL MARKETS, INC.
as Co-Lead Arranger and Book Runner
and
BARCLAYS CAPITAL
as Co-Lead Arranger
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS..................................................... 1
1.1 Definitions......................................................... 1
1.2 Singular and Plural................................................. 11
1.3 Accounting Terms.................................................... 12
ARTICLE II THE ADVANCES.................................................... 12
2.1 Commitment.......................................................... 12
2.2 Required Payments; Termination; Extension of Termination Date....... 12
2.3 Ratable Loans....................................................... 13
2.4 Types of Advances................................................... 13
2.5 Commitment Fee and Reductions of Commitment......................... 13
2.6 Minimum Amount of Advances.......................................... 13
2.7 Optional Principal Payments......................................... 13
2.8 Method of Selecting Types and Interest Periods for New Advances..... 14
2.9 Conversion and Continuation of Outstanding Advances................. 14
2.10 Interest Rates, Interest Payment Dates.............................. 15
2.11 Rate after Maturity................................................. 15
2.12 Method of Payment................................................... 15
2.13 Bonds; Record-keeping; Telephonic Notices........................... 16
2.14 Lending Installations............................................... 16
2.15 Non-Receipt of Funds by the Agent................................... 17
ARTICLE III LETTER OF CREDIT FACILITY....................................... 17
3.1 Issuance............................................................ 17
3.2 Participations...................................................... 17
3.3 Notice.............................................................. 17
3.4 LC Fees............................................................. 18
3.5 Administration; Reimbursement by Banks.............................. 18
3.6 Reimbursement by Company............................................ 19
3.7 Obligations Absolute................................................ 19
3.8 Actions of LC Issuer................................................ 20
3.9 Indemnification..................................................... 20
3.10 Banks' Indemnification.............................................. 20
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EXISTING FACILITY LC SCHEDULE
L/C EFFECTIVE EXPIRATION UNDRAWN STATED
ACCOUNT PARTY NUMBER ISSUER BENEFICIARY DATE DATE AMOUNT
---------------- --------- -------- -------------------------------------- --------- ---------- --------------
CONSUMERS ENERGY ▇▇▇▇▇▇▇▇ Bank One Michigan Dept of Environmental Quality 05/19/03 05/19/04 $ 500,000.00
▇▇▇▇▇▇▇▇ Bank One Michigan Dept of Environmental Quality 05/19/03 05/19/04 $1,000,000.00
▇▇▇▇▇▇▇▇ Bank One Michigan Dept of Environmental Quality 05/19/03 05/19/04 $1,000,000.00
▇▇▇▇▇▇▇▇ Bank One Michigan Dept of Environmental Quality 05/19/03 05/19/04 $1,000,000.00
▇▇▇▇▇▇▇▇ Bank One Michigan Dept of Environmental Quality 05/19/03 05/19/04 $1,000,000.00
▇▇▇▇▇▇▇▇ Bank ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 05/19/03 05/19/04 $ 10,000.00
▇▇▇▇▇▇▇▇ Bank One Charter Township of Oakland 05/19/03 05/19/04 $ 25,463.00
▇▇▇▇▇▇▇▇ Bank One Michigan Dept of Environmental Quality 05/19/03 05/19/04 $2,000,000.00
TABLE OF CONTENTS
(continued)
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3.11 Rights as a Bank.................................................... 21
ARTICLE IV CHANGE IN CIRCUMSTANCES......................................... 21
4.1 Yield Protection.................................................... 21
4.2 Replacement Bank.................................................... 22
4.3 Availability of Eurodollar Rate Loans............................... 22
4.4 Funding Indemnification............................................. 23
4.5 Taxes............................................................... 23
4.6 Bank Certificates, Survival of Indemnity............................ 25
ARTICLE V REPRESENTATIONS AND WARRANTIES.................................. 25
5.1 Incorporation and Good Standing..................................... 25
5.2 Corporate Power and Authority: No Conflicts......................... 25
5.3 Governmental Approvals.............................................. 26
5.4 Legally Enforceable Agreements...................................... 26
5.5 Financial Statements................................................ 26
5.6 Litigation.......................................................... 26
5.7 Margin Stock........................................................ 26
5.8 ERISA............................................................... 27
5.9 Insurance........................................................... 27
5.10 Taxes............................................................... 27
5.11 Investment Company Act.............................................. 27
5.12 Public Utility Holding Company Act.................................. 27
5.13 Bonds............................................................... 27
5.14 Disclosure.......................................................... 27
ARTICLE VI AFFIRMATIVE COVENANTS........................................... 27
6.1 Payment of Taxes, Etc............................................... 27
6.2 Maintenance of Insurance............................................ 28
6.3 Preservation of Corporate Existence, Etc............................ 28
6.4 Compliance with Laws, Etc........................................... 28
6.5 Visitation Rights................................................... 28
6.6 Keeping of Books.................................................... 28
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TABLE OF CONTENTS
(continued)
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6.7 Reporting Requirements.............................................. 28
6.8 Use of Proceeds..................................................... 30
6.9 Maintenance of Properties, Etc...................................... 30
6.10 Bonds............................................................... 30
ARTICLE VII NEGATIVE COVENANTS.............................................. 31
7.1 Liens............................................................... 31
7.2 Sale of Assets...................................................... 32
7.3 Mergers, Etc........................................................ 32
7.4 Compliance with ERISA............................................... 32
7.5 Change in Nature of Business........................................ 32
7.6 Restricted Payments................................................. 32
7.7 Off-Balance Sheet Liabilities....................................... 33
7.8 Transactions with Affiliates........................................ 33
ARTICLE VIII FINANCIAL COVENANTS............................................. 33
8.1 Debt to Capital Ratio............................................... 33
8.2 Interest Coverage Ratio............................................. 33
ARTICLE IX EVENTS OF DEFAULT............................................... 33
9.1 Events of Default................................................... 33
9.2 Remedies............................................................ 35
ARTICLE X WAIVERS, AMENDMENTS AND REMEDIES................................ 36
10.1 Amendments.......................................................... 36
10.2 Preservation of Rights.............................................. 37
ARTICLE XI CONDITIONS PRECEDENT............................................ 37
11.1 Initial Credit Extension............................................ 37
11.2 Each Credit Extension............................................... 38
ARTICLE XII GENERAL PROVISIONS.............................................. 38
12.1 Successors and Assigns.............................................. 38
12.2 Survival of Representations......................................... 40
12.3 Governmental Regulation............................................. 40
12.4 Taxes............................................................... 40
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TABLE OF CONTENTS
(continued)
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12.5 Choice of Law....................................................... 40
12.6 Headings............................................................ 41
12.7 Entire Agreement.................................................... 41
12.8 Expenses; Indemnification........................................... 41
12.9 Severability of Provisions.......................................... 41
12.10 Setoff.............................................................. 42
12.11 Ratable Payments.................................................... 42
12.12 Nonliability of Bank................................................ 42
12.13 Other Agents........................................................ 42
ARTICLE XIII THE AGENT....................................................... 43
13.1 Appointment......................................................... 43
13.2 Powers.............................................................. 43
13.3 General Immunity.................................................... 43
13.4 No Responsibility for Loans, Recitals, Etc.......................... 43
13.5 Action on Instructions of Banks..................................... 43
13.6 Employment of Agents and Counsel.................................... 43
13.7 Reliance on Documents; Counsel...................................... 44
13.8 Agent's Reimbursement and Indemnification........................... 44
13.9 Rights as a Lender.................................................. 44
13.10 Bank Credit Decision................................................ 44
13.11 Successor Agent..................................................... 44
13.12 Agent and Arranger Fees............................................. 45
ARTICLE XIV NOTICES......................................................... 45
14.1 Giving Notice....................................................... 45
14.2 Change of Address................................................... 45
ARTICLE XV TERMINATION OF PRIOR AGREEMENT.................................. 45
ARTICLE XVI COUNTERPARTS.................................................... 46
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TABLE OF CONTENTS
(continued)
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SCHEDULES
PRICING SCHEDULE
COMMITMENT SCHEDULE
EXISTING FACILITY LC SCHEDULE
EXHIBITS
Exhibit A Form of Supplemental Indenture
Exhibit B-1 Required Opinions from ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Exhibit B-2 Required Opinions from Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇, LLP
Exhibit B-3 Required Opinions from Miller, Canfield, Paddock and Stone, P.L.C.
Exhibit C Form of Compliance Certificate
Exhibit D Form of Assignment and Assumption Agreement
Exhibit E Terms of Subordination (Junior Subordinated Debt)
Exhibit F Terms of Subordination (Guaranty of Hybrid Preferred Securities)
Exhibit G Form of Bond Delivery Agreement
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AMENDED AND RESTATED CREDIT AGREEMENT
This Agreement, dated as of September 19, 2003, is among Consumers
Energy Company, a Michigan corporation (the "Company"), the financial
institutions listed on the signature pages hereof (together with their
respective successors and assigns, the "Banks") and Bank One, NA, a national
banking association having its principal office in Chicago, Illinois, as Agent
and as LC Issuer.
W I T N E S S E T H:
WHEREAS, the Company has requested, and the Banks have agreed to enter
into, a credit facility in an aggregate amount of $400,000,000;
NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions. As used in this Agreement:
"Accounting Changes" - see Section 1.3.
"Administrative Questionnaire" means an administrative questionnaire,
substantially in the form supplied by the Agent, completed by a Lender and
furnished to the Agent in connection with this Agreement.
"Advance" means a group of Loans made by the Banks hereunder of the
same Type, made, converted or continued on the same day and, in the case of
Eurodollar Rate Loans, having the same Interest Period.
"Affiliate" means, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all directors
and officers of such Person), controlled by, or under direct or indirect common
control with such Person. A Person shall be deemed to control another entity if
such Person possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of such entity, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means Bank One in its capacity as administrative agent for the
Banks pursuant to Article XIII, and not in its individual capacity as a Bank,
and any successor Agent appointed pursuant to Article XIII.
"Aggregate Commitment" means the aggregate amount of the Commitments of
all Banks.
"Aggregate Outstanding Credit Exposure" means, at any time, the
aggregate of the Outstanding Credit Exposure of all the Banks.
"Agreement" means this Amended and Restated Credit Agreement, as
amended from time to time.
"Alternate Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day and (ii) the sum of the Federal Funds
Effective Rate for such day plus 1/2% per annum.
"Applicable Margin" means, with respect to Advances of any Type at any
time, the percentage rate per annum which is applicable at such time with
respect to Advances of such Type as set forth in the Pricing Schedule.
"Arranger" - see Section 13.12.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Assignment Agreement" - see Section 12.1(e).
"Available Aggregate Commitment" means, at any time, the Available
Commitment then in effect minus the Aggregate Outstanding Credit Exposure at
such time.
"Available Commitment" means, at any time, the lesser of (i) the
Aggregate Commitment and (ii) the face amount of the Bonds.
"Banks" - see the preamble.
"Bank One" means Bank One, NA (Main Office - Chicago), in its
individual capacity, and its successors and assigns.
"Base Eurodollar Rate" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the per annum interest rate determined by the
offered rate per annum at which deposits in U.S. dollars, for a period equal or
comparable to such Interest Period, appears on Telerate page 3750 (or any
successor page) as of 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period, or in the event such offered rate is not
available from the Telerate page, the rate offered on deposits in U.S. dollars,
for a period equal or comparable to such Interest Period, by Bank One's London
Office to prime banks in the London interbank market at approximately 11:00 a.m.
(London time), two Business Days prior to the first day of such Interest Period,
and in an amount substantially equal to the amount of Bank One's relevant
Eurodollar Rate Loan for such Interest Period.
"Bonds" means a series of interest-bearing First Mortgage Bonds created
under the Supplemental Indenture issued in favor of, and in form and substance
satisfactory to, the Agent.
"Bond Delivery Agreement" means a bond delivery agreement whereby the
Agent (x) acknowledges delivery of the Bonds and (y) agrees to hold the Bonds
for the benefit of the Banks and to distribute all payments made by the Company
on account thereof to the Banks, substantially in the form of Exhibit G.
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"Borrowing Date" means a date on which a Credit Extension is made
hereunder.
"Borrowing Notice" - see Section 2.8.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago, Illinois and New York, New York for
the conduct of substantially all of their commercial lending activities,
interbank wire transfers can be made on the Fedwire system and dealings in
United States dollars are carried on in the London interbank market and (ii) for
all other purposes, a day (other than a Saturday or Sunday) on which banks
generally are open in Chicago, Illinois and New York, New York for the conduct
of substantially all of their commercial lending activities and interbank wire
transfers can be made on the Fedwire system.
"Capital Lease" means any lease which has been or would be capitalized
on the books of the lessee in accordance with GAAP.
"CMS" means CMS Energy Corporation, a Michigan corporation.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Collateral Shortfall Amount" - see Section 9.2.
"Commitment" means, for each Bank, the obligation of such Bank to make
Loans to, and participate in Facility LCs issued upon the application of, the
Company in an aggregate amount not exceeding the amount set forth on the
Commitment Schedule or as set forth in any Assignment Agreement that has become
effective pursuant to Section 12.1, as such amount may be modified from time to
time.
"Commitment Fee" - see Section 2.5.
"Commitment Fee Rate" means, at any time, the percentage rate per annum
at which Commitment Fees are accruing on the Unused Commitment as set forth in
the Pricing Schedule.
"Commitment Schedule" means the Schedule identifying each Bank's
Commitment as of the date hereof attached hereto and identified as such.
"Company" - see the preamble.
"Consolidated EBIT" means, for any period, Consolidated Net Income for
such period plus (i) to the extent deducted from revenues in determining such
Consolidated Net Income (without duplication), (a) Consolidated Interest Expense
plus interest and dividends on Hybrid Preferred Securities and on securities of
the type described in clause (iv) of the definition of Total Consolidated Debt
(but only, in the case of securities of the type described in such clause (iv),
to the extent such securities have been deemed to be equity), (b) expense for
taxes paid or accrued, and (c) any non-cash write-offs and write-downs contained
in the Company's Consolidated Net Income, including, without limitation,
write-offs or write-downs related to the sale of assets, impairment of assets
and loss on contracts minus (ii) to the extent included in such
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Consolidated Net Income, extraordinary gains realized other than in the ordinary
course of business, all calculated for the Company and its Subsidiaries on a
consolidated basis in accordance with GAAP.
"Consolidated Interest Expense" means with respect to any period for
which the amount thereof is to be determined, an amount equal to interest
expense on Debt, including payments in the nature of interest under Capital
Leases but excluding (a) interest and dividends paid on Hybrid Preferred
Securities and on securities of the type described in clause (iv) of the
definition of Total Consolidated Debt (but only, in the case of securities of
the type described in such clause (iv), to the extent such securities have been
deemed to be equity), all calculated for the Company and its Subsidiaries on a
consolidated basis in accordance with GAAP (except as otherwise provided above).
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Company and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Subsidiary" means any Subsidiary whose accounts are or
are required to be consolidated with the accounts of the Company in accordance
with GAAP.
"Credit Documents" means this Agreement, the Facility LC Applications,
the Supplemental Indenture and the Bonds.
"Credit Extension" means the making of an Advance or the issuance of a
Facility LC hereunder.
"Debt" means, with respect to any Person, and without duplication, (a)
all indebtedness of such Person for borrowed money, (b) all indebtedness of such
Person for the deferred purchase price of property or services (other than trade
accounts payable arising in the ordinary course of business which are not
overdue), (c) all Unfunded Vested Liabilities of such Person (if such Person is
not the Company, determined in a manner analogous to that of determining
Unfunded Vested Liabilities of the Company), (d) all obligations of such Person
arising under acceptance facilities, (e) all obligations of such Person as
lessee under Capital Leases, (f) all obligations of such Person arising under
any interest rate swap, "cap", "collar" or other hedging agreement; provided
that for purposes of the calculation of Debt for this clause (f) only, the
actual amount of Debt of such Person shall be determined on a net basis to the
extent such agreements permit such amounts to be calculated on a net basis, and
(g) all guaranties, endorsements (other than for collection in the ordinary
course of business) and other contingent obligations of such Person to assure a
creditor against loss (whether by the purchase of goods or services, the
provision of funds for payment, the supply of funds to invest in any Person or
otherwise) in respect of indebtedness or obligations of any other Person of the
kinds referred to in clauses (a) through (f) above.
"Default" means an event which but for the giving of notice or lapse of
time, or both, would constitute an Event of Default.
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"Designated Officer" means the Chief Financial Officer, the Treasurer,
an Assistant Treasurer, any Vice President in charge of financial or accounting
matters or the principal accounting officer of the Company.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Affiliate" means any corporation or trade or business which is a
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as the Company or is under common control (within
the meaning of Section 414(c) of the Code) with the Company.
"Eurodollar Advance" means an Advance consisting of Eurodollar Rate
Loans.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, an interest rate per annum equal to the sum of (i) the
quotient obtained by dividing (a) the Base Eurodollar Rate applicable to such
Interest Period by (b) one minus the Reserve Requirement (expressed as a
decimal) applicable to such Interest Period, plus (ii) the Applicable Margin.
"Eurodollar Rate Loan" means a Loan which bears interest by reference
to the Eurodollar Rate.
"Event of Default" means an event described in Article IX.
"Excluded Taxes" means, in the case of each Bank, the LC Issuer or
applicable Lending Installation and the Agent, taxes imposed on its overall net
income, and franchise taxes imposed on it, by (i) the jurisdiction under the
laws of which such Bank, the LC Issuer or the Agent is incorporated or organized
or (ii) the jurisdiction in which the Agent's, the LC Issuer's or such Bank's
principal executive office or such Bank's or the LC Issuer's applicable Lending
Installation is located.
"Existing Facility LC" means each Facility LC issued under the Prior
Agreement that is listed on the Existing Facility LC Schedule attached hereto.
"Facility LC" - see Section 3.1. The term "Facility LC" includes each
Existing Facility LC.
"Facility LC Application" - see Section 3.3.
"Facility LC Collateral Account" means a special, interest-bearing
account maintained (pursuant to arrangements satisfactory to the Agent) at the
Agent's office at the address specified pursuant to Article XII, which account
shall be in the name of the Company but under the sole dominium and control of
the Agent, for the benefit of the Banks.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the
-5-
Federal Reserve System arranged by Federal funds brokers on such day, as
published for such day (or, if such day is not a Business Day, for the
immediately preceding Business Day) by the Federal Reserve Bank of New York, or,
if such rate is not so published for any day which is a Business Day, the
average of the quotations at approximately 10:00 a.m. (Chicago time) on such day
on such transactions received by the Agent from three Federal funds brokers of
recognized standing selected by the Agent in its sole discretion.
"First Mortgage Bonds" means bonds issued by the Company pursuant to
the Indenture.
"Fitch" means Fitch, Inc. or any successor thereto.
"Floating Rate" means a rate per annum equal to (i) the Alternate Base
Rate plus (ii) the Applicable Margin, changing when and as the Alternate Base
Rate or the Applicable Margin changes.
"Floating Rate Advance" means an Advance consisting of Floating Rate
Loans.
"Floating Rate Loan" means a Loan which bears interest at the Floating
Rate.
"FRB" means the Board of Governors of the Federal Reserve System or any
successor thereto.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the date hereof, applied on a basis consistent
with those used in the preparation of the financial statements referred to in
Section 5.5 (except, for purposes of the financial statements required to be
delivered pursuant to Sections 6.7(b) and (c), for changes concurred in by the
Company's independent public accountants).
"Hybrid Preferred Securities" means any preferred securities issued by
a Hybrid Preferred Securities Subsidiary, where such preferred securities have
the following characteristics:
(i) such Hybrid Preferred Securities Subsidiary lends
substantially all of the proceeds from the issuance of such preferred
securities to the Company or a wholly-owned direct or indirect
Subsidiary of the Company in exchange for Junior Subordinated Debt
issued by the Company or such wholly-owned direct or indirect
Subsidiary, respectively;
(ii) such preferred securities contain terms providing for
the deferral of interest payments corresponding to provisions providing
for the deferral of interest payments on the Junior Subordinated Debt;
and
(iii) the Company or a wholly-owned direct or indirect
Subsidiary of the Company (as the case may be) makes periodic interest
payments on the Junior Subordinated Debt, which interest payments are
in turn used by the Hybrid Preferred Securities Subsidiary to make
corresponding payments to the holders of the preferred securities.
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"Hybrid Preferred Securities Subsidiary" means any Delaware business
trust (or similar entity) (i) all of the common equity interest of which is
owned (either directly or indirectly through one or more wholly-owned
Subsidiaries of the Company) at all times by the Company or a wholly-owned
direct or indirect Subsidiary of the Company, (ii) that has been formed for the
purpose of issuing Hybrid Preferred Securities and (iii) substantially all of
the assets of which consist at all times solely of Junior Subordinated Debt
issued by the Company or a wholly-owned direct or indirect Subsidiary of the
Company (as the case may be) and payments made from time to time on such Junior
Subordinated Debt.
"Indenture" means the Indenture, dated as of September 1, 1945, as
supplemented and amended from time to time, from the Company to JPMorgan Chase
Bank (formerly known as The Chase Manhattan Bank), as successor Trustee.
"Initial Borrowing Date" means September 19, 2003.
"Interest Period" means, with respect to a Eurodollar Advance, a period
of one, two, three or six months, or such shorter period agreed to by the
Company and the Banks, commencing on a Business Day selected by the Company
pursuant to this Agreement. Such Interest Period shall end on the day which
corresponds numerically to such date one, two, three or six months thereafter
(or such shorter period agreed to by the Company and the Banks), provided,
however, that if there is no such numerically corresponding day in such next,
second, third or sixth succeeding month (or such shorter period, as applicable),
such Interest Period shall end on the last Business Day of such next, second,
third or sixth succeeding month (or such shorter period, as applicable). If an
Interest Period would otherwise end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, provided,
however, that if said next succeeding Business Day falls in a new calendar
month, such Interest Period shall end on the immediately preceding Business Day.
The Company may not select any Interest Period that ends after the scheduled
Termination Date.
"Junior Subordinated Debt" means any unsecured Debt of the Company or a
Subsidiary of the Company (i) issued in exchange for the proceeds of Hybrid
Preferred Securities and (ii) subordinated to the rights of the Banks hereunder
and under the other Credit Documents pursuant to terms of subordination
substantially similar to those set forth in Exhibit E, or pursuant to other
terms and conditions satisfactory to the Majority Banks.
"LC Fee" - see Section 3.4.
"LC Issuer" means Bank One (or any subsidiary or affiliate of Bank One
designated by Bank One) in its capacity as issuer of Facility LCs hereunder.
"LC Obligations" means, at any time, the sum, without duplication, of
(i) the aggregate undrawn stated amount under all Facility LCs outstanding at
such time plus (ii) the aggregate unpaid amount at such time of all
Reimbursement Obligations.
"LC Payment Date" - see Section 3.5.
"Lending Installation" means any office, branch, subsidiary or
affiliate of a Bank.
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"Lien" means any lien (statutory or otherwise), security interest,
mortgage, deed of trust, priority, pledge, charge, conditional sale, title
retention agreement, financing lease or other encumbrance or similar right of
others, or any agreement to give any of the foregoing.
"Loan" - see Section 2.1.
"Majority Banks" means, as of any date of determination, Banks in the
aggregate having more than 50% of the Aggregate Commitment as of such date or,
if the Aggregate Commitment has been terminated, Banks in the aggregate holding
more than 50% of the aggregate unpaid principal amount of the Aggregate
Outstanding Credit Exposure as of such date.
"Modify" and "Modification" - see Section 3.1.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. or any successor
thereto.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA.
"Net Proceeds" means, with respect to any sale or issuance of
securities or incurrence of Debt by any Person, the excess of (i) the gross cash
proceeds received by or on behalf of such Person in respect of such sale,
issuance or incurrence (as the case may be) over (ii) customary underwriting
commissions, auditing and legal fees, printing costs, rating agency fees and
other customary and reasonable fees and expenses incurred by such Person in
connection therewith.
"Net Worth" means, with respect to any Person, the excess of such
Person's total assets over its total liabilities, total assets and total
liabilities each to be determined in accordance with GAAP consistently applied,
excluding, however, from the determination of total assets (i) goodwill,
organizational expenses, research and development expenses, trademarks, trade
names, copyrights, patents, patent applications, licenses and rights in any
thereof, and other similar intangibles, (ii) cash held in a sinking or other
analogous fund established for the purpose of redemption, retirement or
prepayment of capital stock or Debt, and (iii) any items not included in clauses
(i) or (ii) above, that are treated as intangibles in conformity with GAAP.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, all Reimbursement Obligations, all accrued and unpaid
commitment fees and all other obligations of the Company to the Banks or to any
Bank, the LC Issuer or the Agent arising under the Credit Documents.
"Off-Balance Sheet Liability" of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any sale and leaseback
transaction which is not a Capital Lease, (iii) any liability under any
so-called "synthetic lease" transaction entered into by such Person, or (iv) any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the balance sheets of such Person, but excluding from this clause
(iv) Operating Leases.
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"Operating Lease" of a Person means any lease of Property (other than a
Capital Lease) by such Person as lessee.
"Other Taxes" - see Section 4.5(b).
"Outstanding Credit Exposure" means, as to any Bank at any time, the
sum of (i) the aggregate principal amount of its Loans outstanding at such time,
plus (ii) an amount equal to its Pro Rata Share of the LC Obligations at such
time.
"Payment Date" means the second Business Day of each calendar quarter
occurring after the Initial Borrowing Date.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, governmental authority or other entity of whatever
nature.
"Plan" means any employee benefit plan (other than a Multiemployer
Plan) maintained for employees of the Company or any ERISA Affiliate and covered
by Title IV of ERISA.
"Pricing Schedule" means the Schedule attached hereto identified as
such.
"Prime Rate" means a rate per annum equal to the prime rate of interest
announced from time to time by Bank One or its parent (which is not necessarily
the lowest rate charged to any customer), changing when and as said prime rate
changes.
"Prior Agreement" means the 364-Day Credit Agreement dated as of March
27, 2003 among the Company, various financial institutions and Bank One, as
Agent, as amended by the First Amendment dated as of August 29, 2003.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.
"Pro Rata Share" means, with respect to a Bank, a portion equal to a
fraction the numerator of which is such Bank's Commitment and the denominator of
which is the Aggregate Commitment.
"Regulation D" means Regulation D of the FRB from time to time in
effect and shall include any successor or other regulation or official
interpretation of said FRB relating to reserve requirements applicable to member
banks of the Federal Reserve System.
"Regulation U" means Regulation U of the FRB from time to time in
effect and shall include any successor or other regulation or official
interpretation of said FRB relating to the extension of credit by banks,
non-banks and non-broker-dealers for the purpose of purchasing or carrying
margin stocks.
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"Reimbursement Obligations" means, at any time, the aggregate of all
obligations of the Company then outstanding under Article III to reimburse the
LC Issuer for amounts paid by the LC Issuer in respect of any one or more
drawings under Facility LCs.
"Reportable Event" has the meaning assigned to that term in Title IV of
ERISA.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"S&P" means Standard and Poor's Rating Services, a division of The
McGraw Hill Companies, Inc. or any successor thereto.
"SEC" means the Securities and Exchange Commission or any governmental
authority which may be substituted therefor.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Securitized Bonds" shall mean any nonrecourse bonds or similar
asset-backed securities issued by a special-purpose Subsidiary of the Company
which are payable solely from specialized charges authorized by the utility
commission of the relevant state in connection with the recovery of (x) stranded
regulatory costs, (y) stranded clean air and pension costs and (z) other
"Qualified Costs" (as defined in M.C.L. Section 460.10h(g)) authorized to be
securitized by the Michigan Public Service Commission.
"Senior Debt" means the First Mortgage Bonds.
"Single Employer Plan" means a Plan maintained by the Company or any
ERISA Affiliate for employees of the Company or any ERISA Affiliate.
"Subsidiary" means, as to any Person, any corporation or other entity
of which at least a majority of the securities or other ownership interests
having ordinary voting power (absolutely or contingently) for the election of
directors or other Persons performing similar functions are at the time owned
directly or indirectly by such Person.
"Supplemental Indenture" means a supplemental indenture substantially
in the form of Exhibit A.
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes and Other Taxes.
"Termination Date" means the earlier of (i) March 26, 2004, or such
later date to which the Termination Date may be extended pursuant to Section
2.2(b), or (ii) the date on which the Commitments are terminated.
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"Termination Event" means (a) a Reportable Event described in Section
4043 of ERISA and the regulations issued thereunder (other than a Reportable
Event not subject to the provision for 30-day notice to the PBGC under such
regulations), or (b) the withdrawal of the Company or any of its ERISA
Affiliates from a Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001 (a) (2) of ERISA, or (c) the filing of a
notice of intent to terminate a Plan or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA, or (d) the institution of proceedings
to terminate a Plan by the PBGC or to appoint a trustee to administer any Plan.
"Total Consolidated Capitalization" means, at any date of
determination, without duplication, the sum of (a) Total Consolidated Debt plus
all amounts excluded from Total Consolidated Debt pursuant to clauses (ii),
(iii) and (iv) of the proviso to such term (but only, in the case of securities
of the type described in such clause (iv), to the extent such securities have
been deemed to be equity), (b) equity of the common stockholders of the Company,
(c) equity of the preference stockholders of the Company and (d) equity of the
preferred stockholders of the Company, in each case determined at such date.
"Total Consolidated Debt" means, at any date of determination, the
aggregate Debt of the Company and its Consolidated Subsidiaries; provided that
Total Consolidated Debt shall exclude (i) the principal amount of any
Securitized Bonds, (ii) any Junior Subordinated Debt owned by any Hybrid
Preferred Securities Subsidiary, (iii) any guaranty by the Company of payments
with respect to any Hybrid Preferred Securities, provided that such guaranty is
subordinated to the rights of the Banks hereunder and under the other Credit
Documents pursuant to terms of subordination substantially similar to those set
forth in Exhibit F, or pursuant to other terms and conditions satisfactory to
the Majority Banks, (iv) such percentage of the Net Proceeds from any issuance
of hybrid debt/equity securities (other than Junior Subordinated Debt and Hybrid
Preferred Securities) by the Company or any Consolidated Subsidiary as shall be
agreed to be deemed equity by the Agent and the Company prior to the issuance
thereof (which determination shall be based on, among other things, the
treatment (if any) given to such securities by the applicable rating agencies).
"Type" - see Section 2.4.
"Unfunded Vested Liabilities" means, (i) in the case of Single Employer
Plans, the amount (if any) by which the present value of all vested
nonforfeitable benefits under such Plan exceeds the fair market value of all
Plan assets allocable to such benefits, all determined as of the then most
recent valuation date for such Plan, and (ii) in the case of Multiemployer
Plans, the withdrawal liability of the Company and its ERISA Affiliates.
"Unused Commitment" means, at any time, the Aggregate Commitment then
in effect minus the Aggregate Outstanding Credit Exposure at such time.
1.2 Singular and Plural. The foregoing definitions shall be
equally applicable to both the singular and plural forms of the defined terms.
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1.3 Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP. If any changes in
generally accepted accounting principles are hereafter required or permitted and
are adopted by the Company or any of its Subsidiaries, or the Company or any of
its Subsidiaries shall change its application of generally accepted accounting
principles with respect to any Off-Balance Sheet Liabilities, including, but not
limited to, the application of Financial Accounting Standards Board
Interpretation Nos. 45 and 46 and Financial Accounting Standards Board Statement
No. 150, in each case with the agreement of its independent certified public
accountants, and such changes result in a change in the method of calculation of
any of the financial covenants, tests, restrictions or standards herein or in
the related definitions or terms used therein ("Accounting Changes"), the
parties hereto agree, at the Company's request, to enter into negotiations, in
good faith, in order to amend such provisions in a credit neutral manner so as
to reflect equitably such changes with the desired result that the criteria for
evaluating the Company's and its Subsidiaries' financial condition shall be the
same after such changes as if such changes had not been made; provided, however,
until such provisions are amended in a manner reasonably satisfactory to the
Agent, the Arranger and the Majority Banks, no Accounting Change shall be given
effect in such calculations. In the event such amendment is entered into, all
references in this Agreement to GAAP shall mean generally accepted accounting
principles as of the date of such amendment.
ARTICLE II
THE ADVANCES
2.1 Commitment. From and including the Initial Borrowing Date and
prior to the Termination Date, each Bank severally agrees, on the terms and
conditions set forth in this Agreement, (a) to make loans to the Company from
time to time (the "Loans"), and (b) to participate in Facility LCs issued upon
the request of the Company from time to time, provided, that, after giving
effect to the making of each such Loan and the issuance of each such Facility
LC, such Bank's Outstanding Credit Exposure shall not exceed its Commitment. In
no event may the Aggregate Outstanding Credit Exposure exceed the Available
Commitment. Subject to the terms and conditions of this Agreement, the Company
may borrow, repay and reborrow at any time prior to the Termination Date. The
Commitments shall expire on the Termination Date.
2.2 Required Payments; Termination; Extension of Termination Date.
(a) The Aggregate Outstanding Credit Exposure and all other unpaid
obligations of the Company hereunder shall be paid in full on the Termination
Date.
(b) Unless the Company gives notice to the Agent (which shall
promptly notify each Bank) not more than 30 nor less than 15 days prior to the
then-scheduled Termination Date that the Company does not want an extension of
the Termination Date pursuant to this Section 2.2, the scheduled Termination
Date shall be automatically extended to (i) in the case of an extension during
2004, March 25, 2005 and (ii) in the case of an extension during 2005, March 24,
2006. The scheduled Termination Date may not be extended past March 24, 2006
(pursuant to this Section 2.2 or any other provision of this Agreement) without
the prior written consent of all Banks.
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2.3 Ratable Loans. Each Advance shall consist of Loans made by the
several Banks ratably according to their Pro Rata Shares.
2.4 Types of Advances. The Advances may be Floating Rate Advances
or Eurodollar Advances (each a "Type" of Advance), or a combination thereof, as
selected by the Company in accordance with Sections 2.8 and 2.9.
2.5 Commitment Fee and Reductions of Commitment.
(a) The Company agrees to pay to the Agent for the account of each
Bank according to its Pro Rata Share a commitment fee (the "Commitment Fee") at
the Commitment Fee Rate on the daily Unused Commitment from the Initial
Borrowing Date to but not including the date on which this Agreement is
terminated in full and all of the Obligations hereunder have been paid in full.
The Commitment Fee shall be payable quarterly in arrears on each Payment Date
(for the quarter then most recently ended) and on the Termination Date (for the
period then ended for which such fee has not previously been paid). The
Commitment Fee shall be calculated for actual days elapsed on the basis of a 360
day year.
(b) The Company may permanently reduce the Aggregate Commitment in
whole, or in part ratably among the Banks in the minimum amount of $10,000,000
(and in multiples of $1,000,000 if in excess thereof), upon at least five
Business Days' written notice to the Agent, which shall specify the amount of
any such reduction, provided that the Aggregate Commitment may not be reduced
below the Aggregate Outstanding Credit Exposure. All accrued Commitment Fees
shall be payable on the effective date of any termination of the obligation of
the Banks to make Credit Extensions hereunder. Upon any permanent reduction in
the Aggregate Commitment pursuant to the terms of this Section 2.5(b), the Agent
shall, upon request of the Company, promptly surrender to or upon the order of
the Company one or more Bonds specified by the Company; provided that the
Company remains in compliance with Section 6.10.
2.6 Minimum Amount of Advances. Each Advance shall be in the
minimum amount of $10,000,000 (and in integral multiples of $1,000,000 if in
excess thereof), provided that any Floating Rate Advance may be in the amount of
the Available Aggregate Commitment (rounded down, if necessary, to an integral
multiple of $1,000,000).
2.7 Optional Principal Payments. The Company may from time to time
prepay, without penalty or premium, all outstanding Floating Rate Advances or,
in a minimum aggregate amount of $10,000,000 or a higher integral multiple of
$1,000,000, any portion of the outstanding Floating Rate Advances upon one
Business Day's prior notice to the Agent. The Company may from time to time pay,
subject to the payment of any funding indemnification amounts required by
Section 4.4 but without penalty or premium, all outstanding Eurodollar Advances
or, in a minimum aggregate amount of $10,000,000 or a higher integral multiple
of $1,000,000, any portion of any outstanding Eurodollar Advance upon three
Business Days' prior notice to the Agent; provided that if after giving effect
to any such prepayment the principal amount of any Eurodollar Advance is less
than $10,000,000, such Eurodollar Advance shall automatically convert into a
Floating Rate Advance.
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2.8 Method of Selecting Types and Interest Periods for New
Advances. The Company shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable thereto from time to time.
The Company shall give the Agent irrevocable notice (a "Borrowing Notice") not
later than 11:00 a.m. (Chicago time) on the Borrowing Date of each Floating Rate
Advance and not later than 11:00 a.m. (Chicago time) three Business Days before
the Borrowing Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the initial
Interest Period applicable thereto.
Promptly after receipt thereof, the Agent will notify each Bank of the contents
of each Borrowing Notice. Not later than noon (Chicago time) on each Borrowing
Date, each Bank shall make available its Loan in funds immediately available in
Chicago to the Agent at its address specified pursuant to Section 14. To the
extent funds are received from the Banks, the Agent will make such funds
available to the Company at the Agent's aforesaid address. No Bank's obligation
to make any Loan shall be affected by any other Bank's failure to make any Loan.
2.9 Conversion and Continuation of Outstanding Advances. Floating
Rate Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into Eurodollar Advances pursuant to this
Section 2.9 or are repaid in accordance with Section 2.2 or 2.7. Each Eurodollar
Advance shall continue as a Eurodollar Advance until the end of the then
applicable Interest Period therefor, at which time such Eurodollar Advance shall
be automatically converted into a Floating Rate Advance unless (x) such
Eurodollar Advance is or was repaid in accordance with Section 2.2 or 2.7 or (y)
the Company shall have given the Agent a Conversion/Continuation Notice (as
defined below) requesting that, at the end of such Interest Period, such
Eurodollar Advance continue as a Eurodollar Advance for the same or another
Interest Period. Subject to the terms of Section 2.6, the Company may elect from
time to time to convert all or any part of a Floating Rate Advance into a
Eurodollar Advance. The Company shall give the Agent irrevocable notice (a
"Conversion/Continuation Notice") of each conversion of a Floating Rate Advance
into a Eurodollar Advance or continuation of a Eurodollar Advance not later than
11:00 a.m. (Chicago time) at least three Business Days prior to the date of the
requested conversion or continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount and Type of the Advance which is to
be converted or continued; and
(iii) the amount of the Advance which is to be converted into or
continued as a Eurodollar Advance and the duration of the
Interest Period applicable thereto.
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provided that no Advance may be continued as, or converted into, a Eurodollar
Advance if (x) such continuation or conversion would violate any provision of
this Agreement or (y) a Default or Event of Default exists.
2.10 Interest Rates, Interest Payment Dates. (a) Subject to Section
2.11, each Advance shall bear interest as follows:
(i) at any time such Advance is a Floating Rate Advance,
at a rate per annum equal to the Floating Rate from time to time in
effect; and
(ii) at any time such Advance is a Eurodollar Advance, at
a rate per annum equal to the Eurodollar Rate for each applicable
Interest Period therein.
Changes in the rate of interest on that portion or any Advance maintained as a
Floating Rate Advance will take effect simultaneously with each change in the
Floating Rate.
(b) Interest accrued on each Floating Rate Advance shall be
payable on each Payment Date and at maturity. Interest accrued on each
Eurodollar Advance shall be payable on the last day of its applicable Interest
Period, on any date on which such Eurodollar Advance is prepaid and at maturity.
Interest accrued on each Eurodollar Advance having an Interest Period longer
than three months shall also be payable on the last day of each three-month
interval during such Interest Period. Interest on Eurodollar Advances, interest
on Floating Rate Advances based on the Federal Funds Effective Rate and the LC
Fee shall be calculated for actual days elapsed on the basis of a 360-day year.
Interest on Floating Rate Advances based on the Prime Rate shall be calculated
for actual days elapsed on the basis of a 365- or 366-day year, as appropriate.
Interest on each Advance shall accrue from and including the date such Advance
is made to but excluding the date payment thereof is received in accordance with
Section 2.12. If any payment of principal of or interest on an Advance shall
become due on a day which is not a Business Day, such payment shall be made on
the next succeeding Business Day (unless, in the case of a Eurodollar Advance,
such next succeeding Business Day falls in a new calendar month, in which case
such payment shall be due on the immediately preceding Business Day) and, in the
case of a principal payment, such extension of time shall be included in
computing interest in connection with such payment.
2.11 Rate after Maturity. Any Advance not paid by the Company at
maturity, whether by acceleration or otherwise, shall bear interest until paid
in full at a rate per annum equal to the higher of the rate otherwise applicable
thereto plus 1% or the Floating Rate plus 1%.
2.12 Method of Payment. All payments of principal, interest and
fees hereunder shall be made in immediately available funds to the Agent at its
address specified on its signature page to this Agreement (or at any other
Lending Installation of the Agent specified in writing by the Agent to the
Company) not later than noon (Chicago time) on the date when due and shall
(except in the case of Reimbursement Obligations for which the LC Issuer has not
been fully indemnified by the Banks, or as otherwise specifically required
hereunder) be applied ratably by the Agent among the Banks. Funds received after
such time shall be deemed received on the following Business Day unless the
Agent shall have received from, or on behalf of, the Company
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a Federal Reserve reference number with respect to such payment before 3:00 p.m.
(Chicago time) on the date of such payment. Each payment delivered to the Agent
for the account of any Bank shall be delivered promptly by the Agent in the same
type of funds received by the Agent to such Bank at the address specified for
such Bank in its Administrative Questionnaire or at any Lending Installation
specified in a notice received by the Agent from such Bank. The Agent is hereby
authorized to charge the account of the Company maintained with Bank One, if
any, for each payment of principal, interest, Reimbursement Obligation and fees
as such payment becomes due hereunder. Each reference to the Agent in this
Section 2.12 shall also be deemed to refer, and shall apply equally, to the LC
Issuer, in the case of payments required to be made by the Company to the LC
Issuer pursuant to Section 3.6.
2.13 Bonds; Record-keeping; Telephonic Notices.
(a) The obligation of the Company to repay the Obligations shall
be evidenced by one or more Bonds.
(b) Each Bank shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Company to such Bank
resulting from each Loan made by such Bank from time to time, including the
amounts of principal and interest payable and paid to such Bank from time to
time hereunder.
(c) The Agent shall also maintain accounts in which it will record
(i) the amount of each Loan made hereunder, the Type thereof and the Interest
Period with respect thereto, (ii) the amount of any principal or interest due
and payable or to become due and payable from the Company to each Bank
hereunder, (iii) the original stated amount of each Facility LC and the amount
of LC Obligations outstanding at any time, and (iv) the amount of any sum
received by the Agent hereunder from the Company and each Bank's share thereof.
(d) The entries maintained in the accounts maintained pursuant to
paragraphs (b) and (c) above shall be prima facie evidence of the existence and
amounts of the Obligations therein recorded; provided, however, that the failure
of the Agent or any Bank to maintain such accounts or any error therein shall
not in any manner affect the obligation of the Company to repay the Obligations
in accordance with their terms.
(e) The Company hereby authorizes the Banks and the Agent to make
Advances based on telephonic notices made by any person or persons the Agent or
any Bank in good faith believes to be acting on behalf of the Company. The
Company agrees to deliver promptly to the Agent a written confirmation of each
telephonic notice signed by a Designated Officer. If the written confirmation
differs in any material respect from the action taken by the Agent and the
Banks, the records of the Agent and the Banks shall govern absent manifest
error.
2.14 Lending Installations. Subject to the provisions of Section
4.6, each Bank may book its Loans and its participation in any LC Obligations
and the LC Issuer may book the Facility LCs at any Lending Installation selected
by such Bank or the LC Issuer, as the case may be, and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Loans shall be deemed held by the applicable
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Bank for the benefit of such Lending Installation. Each Bank may, by written or
facsimile notice to the Company, designate a Lending Installation through which
Loans will be made by it or Facility LC's will be issued by it and for whose
account payments on the Loans or payments with respect to Facility LCs are to be
made.
2.15 Non-Receipt of Funds by the Agent. Unless a Bank or the
Company, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Bank, the
proceeds of a Loan or (ii) in the case of the Company, a payment of principal,
interest or fees to the Agent for the account of the Banks, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Bank or the Company, as the case may be, has not in fact made such payment
to the Agent, the recipient of such payment shall, on demand by the Agent, repay
to the Agent the amount so made available together with interest thereon in
respect of each day during the period commencing on the date such amount was so
made available by the Agent until the date the Agent recovers such amount at a
rate per annum equal to (i) in the case of payment by a Bank, the Federal Funds
Rate for such day or (ii) in the case of payment by the Company, the interest
rate applicable to the relevant Loan.
ARTICLE III
LETTER OF CREDIT FACILITY
3.1 Issuance. The LC Issuer hereby agrees, on the terms and
conditions set forth in this Agreement, to issue standby and commercial letters
of credit denominated in U.S. dollars (each, a "Facility LC") and to renew,
extend, increase, decrease or otherwise modify each Facility LC ("Modify," and
each such action a "Modification"), from time to time from and including the
date hereof and prior to the Termination Date upon the request of the Company;
provided that immediately after each such Facility LC is issued or Modified, (i)
the aggregate amount of the outstanding LC Obligations shall not exceed
$100,000,000 and (ii) the Aggregate Outstanding Credit Exposure shall not exceed
the Available Commitment. No Facility LC shall (x) be issued later than 30 days
prior to the scheduled Termination Date, (y) have an expiry date later than the
fifth Business Day prior to the scheduled Termination Date or (z) provide for
time drafts.
3.2 Participations. Upon the issuance or Modification by the LC
Issuer of a Facility LC in accordance with this Article III (or, in the case of
any Existing Facility LC, on the Initial Borrowing Date), the LC Issuer shall be
deemed, without further action by any party hereto, to have unconditionally and
irrevocably sold to each Bank, and each Bank shall be deemed, without further
action by any party hereto, to have unconditionally and irrevocably purchased
from the LC Issuer, a participation in such Facility LC (and each Modification
thereof) and the related LC Obligations in proportion to its Pro Rata Share.
3.3 Notice. Subject to Section 3.1, the Company shall give the LC
Issuer notice prior to 11:00 a.m. (Chicago time) at least three Business Days
prior to the proposed date of issuance (other than an Existing Facility LC) or
Modification of each Facility LC, specifying the beneficiary, the proposed date
of issuance (or Modification) and the expiry date of such Facility
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LC, and describing the proposed terms of such Facility LC and the nature of the
transactions proposed to be supported thereby. Upon receipt of such notice, the
LC Issuer shall promptly notify the Agent, and the Agent shall promptly notify
each Bank, of the contents thereof and of the amount of such Bank's
participation in such proposed Facility LC. The issuance or Modification by the
LC Issuer of any Facility LC shall, in addition to the conditions precedent set
forth in Article XI (the satisfaction of which the LC Issuer shall have no duty
to ascertain), be subject to the conditions precedent that such Facility LC
shall be satisfactory to the LC Issuer and that the Company shall have executed
and delivered such application agreement and/or such other instruments and
agreements relating to such Facility LC as the LC Issuer shall have reasonably
requested (each, a "Facility LC Application"). In the event of any conflict
between the terms of this Agreement and the terms of any Facility LC
Application, the terms of this Agreement shall control.
3.4 LC Fees. The Company shall pay to the Agent, for the account
of the Banks ratably in accordance with their respective Pro Rata Shares, a
letter of credit fee (the "LC Fee") at a per annum rate equal to the Applicable
Margin for Eurodollar Rate Loans in effect from time to time on the average
daily undrawn stated amount of each Facility LC, such fee to be payable in
arrears on each Payment Date and the Termination Date (and, if applicable,
thereafter on demand). The Company shall also pay to the LC Issuer for its own
account (a) a fronting fee of 0.15% per annum on the average daily undrawn
stated amount of each Facility LC, such fee to be payable in arrears on each
Payment Date and the Termination Date (and, if applicable, thereafter on
demand), and (b) documentary and processing charges in connection with the
issuance or Modification of and draws under Facility LCs in accordance with the
LC Issuer's standard schedule for such charges as in effect from time to time.
3.5 Administration; Reimbursement by Banks. Upon receipt from the
beneficiary of any Facility LC of any demand for payment under such Facility LC,
the LC Issuer shall notify the Agent and the Agent shall promptly notify the
Company and each other Bank as to the amount to be paid by the LC Issuer as a
result of such demand and the proposed payment date (the "LC Payment Date"). The
responsibility of the LC Issuer to the Company and each Bank shall be only to
determine that the documents (including each demand for payment) delivered under
each Facility LC in connection with such presentment shall be in conformity in
all material respects with such Facility LC. The LC Issuer shall endeavor to
exercise the same care in the issuance and administration of the Facility LCs as
it does with respect to letters of credit in which no participations are
granted, it being understood that in the absence of any gross negligence or
willful misconduct by the LC Issuer, each Bank shall be unconditionally and
irrevocably liable without regard to the occurrence of any Default or any
condition precedent whatsoever, to reimburse the LC Issuer on demand for (i)
such Bank's Pro Rata Share of the amount of each payment made by the LC Issuer
under each Facility LC to the extent such amount is not reimbursed by the
Company pursuant to Section 3.6 below, plus (ii) interest on the foregoing
amount to be reimbursed by such Bank, for each day from the date of the LC
Issuer's demand for such Reimbursement (or, if such demand is made after 11:00
a.m. (Chicago time) on such date, from the next succeeding Business Day) to the
date on which such Bank pays the amount to be reimbursed by it, at a rate of
interest per annum equal to the Federal Funds Effective Rate for the first three
days and, thereafter, at a rate of interest equal to the rate applicable to
Floating Rate Advances.
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3.6 Reimbursement by Company. The Company shall be irrevocably and
unconditionally obligated to reimburse the LC Issuer on the applicable LC
Payment Date for any amounts to be paid by the LC Issuer upon any drawing under
any Facility LC, without presentment, demand, protest or other formalities of
any kind; provided that neither the Company nor any Bank shall hereby be
precluded from asserting any claim for direct (but not consequential) damages
suffered by the Company or such Bank to the extent, but only to the extent,
caused by (i) the willful misconduct or gross negligence of the LC Issuer in
determining whether a request presented under any Facility LC issued by it
complied with the terms of such Facility LC or (ii) the LC Issuer's failure to
pay under any Facility LC issued by it after the presentation to it of a request
strictly complying with the terms and conditions of such Facility LC. All such
amounts paid by the LC Issuer and remaining unpaid by the Company shall bear
interest, payable on demand, for each day until paid at a rate per annum equal
to (x) the rate applicable to Floating Rate Advances for such day if such day
falls on or before the applicable LC Payment Date and (y) the sum of 1% plus the
rate applicable to Floating Rate Advances for such day if such day falls after
such LC Payment Date. The LC Issuer will pay to each Bank ratably in accordance
with its Pro Rata Share all amounts received by it from the Company for
application in payment, in whole or in part, of the Reimbursement Obligation in
respect of any Facility LC issued by the LC Issuer, but only to the extent such
Bank has made payment to the LC Issuer in respect of such Facility LC pursuant
to Section 3.5. Subject to the terms and conditions of this Agreement (including
without limitation the submission of a Borrowing Notice in compliance with
Section 2.8 and the satisfaction of the applicable conditions precedent set
forth in Article XI), the Company may request an Advance hereunder for the
purpose of satisfying any Reimbursement Obligation.
3.7 Obligations Absolute. The Company's obligations under this
Article III shall be absolute and unconditional under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment which the
Company may have or have had against the LC Issuer, any Bank or any beneficiary
of a Facility LC. The Company further agrees with the LC Issuer and the Banks
that the LC Issuer and the Banks shall not be responsible for, and the Company's
Reimbursement Obligation in respect of any Facility LC shall not be affected by,
among other things, the validity or genuineness of documents or of any
endorsements thereon, even if such documents should in fact prove to be in any
or all respects invalid, fraudulent or forged, or any dispute between or among
the Company, any of its affiliates, the beneficiary of any Facility LC or any
financing institution or other party to whom any Facility LC may be transferred
or any claims or defenses whatsoever of the Company or of any of its affiliates
against the beneficiary of any Facility LC or any such transferee. The LC Issuer
shall not be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Facility LC. The Company agrees that any
action taken or omitted by the LC Issuer or any Bank under or in connection with
each Facility LC and the related drafts and documents, if done without gross
negligence or willful misconduct, shall be binding upon the Company and shall
not put the LC Issuer or any Bank under any liability to the Company. Nothing in
this Section 3.7 is intended to limit the right of the Company to make a claim
against the LC Issuer for damages as contemplated by the proviso to the first
sentence of Section 3.6.
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3.8 Actions of LC Issuer. The LC Issuer shall be entitled to rely,
and shall be fully protected in relying, upon any Facility LC, draft, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person or Persons, and upon advice and statements of legal
counsel, independent accountants and other experts selected by the LC Issuer.
The LC Issuer shall be fully justified in failing or refusing to take any action
under this Agreement unless it shall first have received such advice or
concurrence of the Majority Banks as it reasonably deems appropriate or it shall
first be indemnified to its reasonable satisfaction by the Banks against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. Notwithstanding any other provision of this
Article III, the LC Issuer shall in all cases be fully protected in acting, or
in refraining from acting, under this Agreement in accordance with a request of
the Majority Banks, and such request and any action taken or failure to act
pursuant thereto shall be binding upon the Banks and any future holders of a
participation in any Facility LC.
3.9 Indemnification. The Company hereby agrees to indemnify and
hold harmless each Bank, the LC Issuer and the Agent, and their respective
directors, officers, agents and employees from and against any and all claims
and damages, losses, liabilities, reasonable costs or expenses which such Bank,
the LC Issuer or the Agent may incur (or which may be claimed against such Bank,
the LC Issuer or the Agent by any Person whatsoever) by reason of or in
connection with the issuance, execution and delivery or transfer of or payment
or failure to pay under any Facility LC or any actual or proposed use of any
Facility LC, including, without limitation, any claims, damages, losses,
liabilities, costs or expenses which the LC Issuer may incur by reason of or in
connection with (i) the failure of any other Bank to fulfill or comply with its
obligations to the LC Issuer hereunder (but nothing herein contained shall
affect any rights the Company may have against any defaulting Bank) or (ii) by
reason of or on account of the LC Issuer issuing any Facility LC which specifies
that the term "Beneficiary" included therein includes any successor by operation
of law of the named Beneficiary, but which Facility LC does not require that any
drawing by any such successor Beneficiary be accompanied by a copy of a legal
document, satisfactory to the LC Issuer, evidencing the appointment of such
successor Beneficiary; provided that the Company shall not be required to
indemnify any Bank, the LC Issuer or the Agent for any claims, damages, losses,
liabilities, costs or expenses to the extent, but only to the extent, caused by
(x) the willful misconduct or gross negligence of the LC Issuer in determining
whether a request presented under any Facility LC complied with the terms of
such Facility LC or (y) the LC Issuer's failure to pay under any Facility LC
after the presentation to it of a request strictly complying with the terms and
conditions of such Facility LC. Nothing in this Section 3.9 is intended to limit
the obligations of the Company under any other provision of this Agreement.
3.10 Banks' Indemnification. Each Bank shall, ratably in accordance
with its Pro Rata Share, indemnify the LC Issuer, its affiliates and their
respective directors, officers, agents and employees (to the extent not
reimbursed by the Company) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from such indemnitees' gross negligence or willful
misconduct or the LC Issuer's failure to pay under any Facility LC after the
presentation to it of a request strictly complying
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with the terms and conditions of the Facility LC) that such indemnitees may
suffer or incur in connection with this Article III or any action taken or
omitted by such indemnitees hereunder.
3.11 Rights as a Bank. In its capacity as a Bank, the LC Issuer
shall have the same rights and obligations as any other Bank.
ARTICLE IV
CHANGE IN CIRCUMSTANCES
4.1 Yield Protection.
(a) If any change in law or any governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
interpretation thereof by any agency or authority having jurisdiction over any
Bank or the LC Issuer,
(i) subjects any Bank or any applicable Lending
Installation or the LC Issuer to any increased tax, duty, charge or
withholding on or from payments due from the Company (excluding
taxation measured by or attributable to the overall net income of such
Bank or applicable Lending Installation, whether overall or in any
geographic area), or changes the rate of taxation of payments to any
Bank or LC Issuer in respect of its Credit Extensions (including any
participations in Facility LCs) or other amounts due it hereunder, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit
extended by any Bank, the LC Issuer or any applicable Lending
Installation (including, without limitation, any reserve costs under
Regulation D with respect to Eurocurrency liabilities (as defined in
Regulation D)), or
(iii) imposes any other condition the result of which is to
increase the cost to any Bank, the LC Issuer or any applicable Lending
Installation of making, funding or maintaining Credit Extensions
(including any participations in Facility LCs), or reduces any amount
receivable by any Bank, the LC Issuer or any applicable Lending
Installation in connection with Credit Extensions (including any
participations in Facility LCs) or requires any Bank, the LC Issuer or
any applicable Lending Installation to make any payment calculated by
reference to its Outstanding Credit Exposure or interest received by
it, by an amount deemed material by such Bank or the LC Issuer, or
(iv) affects the amount of capital required or expected to
be maintained by any Bank, the LC Issuer or Lending Installation or any
corporation controlling any Bank or LC Issuer and such Bank or the LC
Issuer, as applicable, determines the amount of capital required is
increased by or based upon the existence of this Agreement or its
obligation to make Credit Extensions (including any participations in
Facility LCs) hereunder or of commitments of this type,
then, upon presentation by such Bank or the LC Issuer to the Company of a
certificate (as referred to in the immediately succeeding sentence of this
Section 4.1) setting forth the basis for
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such determination and the additional amounts reasonably determined by such Bank
or the LC Issuer for the period of up to 90 days prior to the date on which such
certificate is delivered to the Company and the Agent, to be sufficient to
compensate such Bank or the LC Issuer, as applicable, in light of such
circumstances, the Company shall within 30 days of such delivery of such
certificate pay to the Agent for the account of such Bank or the LC Issuer, as
applicable, the specified amounts set forth on such certificate. The affected
Bank or the LC Issuer, as applicable, shall deliver to the Company and the Agent
a certificate setting forth the basis of the claim and specifying in reasonable
detail the calculation of such increased expense, which certificate shall be
prima facie evidence as to such increase and such amounts. An affected Bank or
the LC Issuer, as applicable, may deliver more than one certificate to the
Company during the term of this Agreement. In making the determinations
contemplated by the above-referenced certificate, any Bank and the LC Issuer may
make such reasonable estimates, assumptions, allocations and the like that such
Bank or the LC Issuer, as applicable, in good faith determines to be
appropriate, and such Bank's or the LC Issuer's selection thereof in accordance
with this Section 4.1 shall be conclusive and binding on the Company, absent
manifest error.
(b) Neither the LC Issuer nor any Bank shall be entitled to demand
compensation or be compensated hereunder to the extent that such compensation
relates to any period of time more than 90 days prior to the date upon which
such Bank or the LC Issuer, as applicable, first notified the Company of the
occurrence of the event entitling such Bank or the LC Issuer, as applicable, to
such compensation (unless, and to the extent, that any such compensation so
demanded shall relate to the retroactive application of any event so notified to
the Company).
4.2 Replacement Bank.
(a) If any Bank shall make a demand for payment under Section 4.1,
then within 30 days after such demand, the Company may, with the approval of the
Agent (which approval shall not be unreasonably withheld) and provided that no
Default or Event of Default shall then have occurred and be continuing, demand
that such Bank assign to one or more financial institutions designated by the
Company and approved by the Agent all (but not less than all) of such Bank's
Commitment and Outstanding Credit Exposure within the period ending on the later
of such 30th day and the last day of the longest of the then current Interest
Periods or maturity dates for such Outstanding Credit Exposure. It is understood
that such assignment shall be consummated on terms satisfactory to the assigning
Bank, provided that such Bank's consent to such an assignment shall not be
unreasonably withheld.
(b) If the Company shall elect to replace a Bank pursuant to
clause (a) above, the Company shall prepay the Outstanding Credit Exposure of
such Bank, and the bank or banks selected by the Company shall replace such Bank
as a Bank hereunder pursuant to an instrument satisfactory to the Company, the
Agent and the Bank being replaced by making Credit Extensions to the Company in
the amount of the Outstanding Credit Exposure of such assigning Bank and
assuming all the same rights and responsibilities hereunder as such assigning
Bank and having the same Commitment as such assigning Bank.
4.3 Availability of Eurodollar Rate Loans. If
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(a) any Bank determines that maintenance of a Eurodollar Rate Loan
at a suitable Lending Installation would violate any applicable law, rule,
regulation or directive, whether or not having the force of law, or
(b) the Majority Banks determine that (i) deposits of a type and
maturity appropriate to match fund Eurodollar Rate Loans are not available or
(ii) the Base Eurodollar Rate does not accurately reflect the cost of making or
maintaining a Eurodollar Rate Loan,
then the Agent shall suspend the availability of Eurodollar Rate Loans and, in
the case of clause (a), require any Eurodollar Rate Loans to be converted to
Floating Rate Loans on such date as is required by the applicable law, rule,
regulation or directive.
4.4 Funding Indemnification. If any payment of a Eurodollar Rate
Loan occurs on a date which is not the last day of an applicable Interest
Period, whether because of prepayment or otherwise, or a Eurodollar Rate Loan is
not made on the date specified by the Company for any reason other than default
by the Banks, the Company will indemnify each Bank for any loss or cost (but not
lost profits) incurred by it resulting therefrom, including, without limitation,
any loss or cost in liquidating or employing deposits acquired to fund or
maintain such Eurodollar Rate Loan; provided that the Company shall not be
liable for any of the foregoing to the extent they arise because of acceleration
by any Bank.
4.5 Taxes.
(a) All payments by the Company to or for the account of any Bank,
the LC Issuer or the Agent hereunder or under any Bond or Facility LC
Application shall be made free and clear of and without deduction for any and
all Taxes. If the Company shall be required by law to deduct any Taxes from or
in respect of any sum payable hereunder to any Bank, the LC Issuer or the Agent,
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 4.5) such Bank, the LC Issuer or the Agent (as the case may
be) receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Company shall make such deductions, (iii) the
Company shall pay the full amount deducted to the relevant authority in
accordance with applicable law and (iv) the Company shall furnish to the Agent
the original copy of a receipt evidencing payment thereof within 30 days after
such payment is made.
(b) In addition, the Company hereby agrees to pay any present or
future stamp or documentary taxes and any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or under
any Bond or Facility LC Application or from the execution or delivery of, or
otherwise with respect to, this Agreement or any Bond or Facility LC Application
("Other Taxes").
(c) The Company hereby agrees to indemnify the Agent, the LC
Issuer and each Bank for the full amount of Taxes or Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed on amounts payable under
this Section 3.5) paid by the Agent, the LC Issuer or such Bank and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto. Payments due under this indemnification shall be made within
-23-
30 days of the date the Agent, the LC Issuer or such Bank makes demand therefor
pursuant to Section 4.6.
(d) Each Bank that is not incorporated under the laws of the
United States of America or a state thereof (each a "Non-U.S. Bank") agrees that
it will, not more than ten Business Days after the date hereof, or, if later,
not more than ten Business Days after becoming a Bank hereunder, (i) deliver to
each of the Company and the Agent two (2) duly completed copies of United States
Internal Revenue Service Form W8BEN or W8ECI, certifying in either case that
such Bank is entitled to receive payments under this Agreement without deduction
or withholding of any United States federal income taxes, and (ii) deliver to
each of the Company and the Agent a United States Internal Revenue Form W-8 or
W-9, as the case may be, and certify that it is entitled to an exemption from
United States backup withholding tax. Each Non-U.S. Bank further undertakes to
deliver to each of the Company and the Agent (x) renewals or additional copies
of such form (or any successor form) on or before the date that such form
expires or becomes obsolete, and (y) after the occurrence of any event requiring
a change in the most recent forms so delivered by it, such additional forms or
amendments thereto as may be reasonably requested by the Company or the Agent.
All forms or amendments described in the preceding sentence shall certify that
such Bank is entitled to receive payments under this Agreement without deduction
or withholding of any United States federal income taxes, unless an event
(including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Bank from duly completing and delivering any such form or amendment with respect
to it and such Bank advises the Company and the Agent that it is not capable of
receiving payments without any deduction or withholding of United States federal
income tax.
(e) For any period during which a Non-U.S. Bank has failed to
provide the Company with an appropriate form pursuant to clause (d), above
(unless such failure is due to a change in treaty, law or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, occurring subsequent to the date on which a form originally was
required to be provided), such Non-U.S. Bank shall not be entitled to
indemnification under this Section 4.5 with respect to Taxes imposed by the
United States; provided that, should a Non-U.S. Bank which is otherwise exempt
from or subject to a reduced rate of withholding tax become subject to Taxes
because of its failure to deliver a form required under clause (d) above, the
Company shall take such steps as such Non-U.S. Bank shall reasonably request to
assist such Non-U.S. Bank to recover such Taxes.
(f) Any Bank that is entitled to an exemption from or reduction of
withholding tax with respect to payments under this Agreement or any Bond
pursuant to the law of any relevant jurisdiction or any treaty shall deliver to
the Company (with a copy to the Agent), at the time or times prescribed by
applicable law, such properly completed and executed documentation prescribed by
applicable law as will permit such payments to be made without withholding or at
a reduced rate.
(g) If the U.S. Internal Revenue Service or any other governmental
authority of the United States or any other country or any political subdivision
thereof asserts a claim that the
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Agent did not properly withhold tax from amounts paid to or for the account of
any Bank (because the appropriate form was not delivered or properly completed,
because such Bank failed to notify the Agent of a change in circumstances which
rendered its exemption from withholding ineffective, or for any other reason),
such Bank shall indemnify the Agent fully for all amounts paid, directly or
indirectly, by the Agent as tax, withholding therefor, or otherwise, including
penalties and interest, and including taxes imposed by any jurisdiction on
amounts payable to the Agent under this subsection, together with all costs and
expenses related thereto (including attorneys fees and time charges of attorneys
for the Agent, which attorneys may be employees of the Agent). The obligations
of the Banks under this Section 4.5(g) shall survive the payment of the
Obligations and termination of this Agreement.
4.6 Bank Certificates, Survival of Indemnity. To the extent
reasonably possible, each Bank shall designate an alternate Lending Installation
with respect to Eurodollar Rate Loans to reduce any liability of the Company to
such Bank under Section 4.1 or to avoid the unavailability of Eurodollar Rate
Loan under Section 4.3, so long as such designation is not disadvantageous to
such Bank. A certificate of such Bank as to the amount due under Section 4.1,
4.4 or 4.5 shall be final, conclusive and binding on the Company in the absence
of manifest error. Determination of amounts payable under such Sections in
connection with a Eurodollar Rate Loan shall be calculated as though each Bank
funded each Eurodollar Rate Loan through the purchase of a deposit of the type
and maturity corresponding to the deposit used as a reference in determining the
Base Eurodollar Rate applicable to such Loan whether in fact that is the case or
not. Unless otherwise provided herein, the amount specified in any certificate
shall be payable on demand after receipt by the Company of such certificate. The
obligations of the Company under Sections 4.1, 4.4 and 4.5 shall survive payment
of the Obligations and termination of this Agreement, provided, that no Bank
shall be entitled to compensation to the extent that such compensation relates
to any period of time more than 90 days after the termination of this Agreement.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Company hereby represents and warrants that:
5.1 Incorporation and Good Standing. The Company is duly
incorporated, validly existing and in good standing under the laws of the State
of Michigan.
5.2 Corporate Power and Authority: No Conflicts. The execution,
delivery and performance by the Company of the Credit Documents are within the
Company's corporate powers, have been duly authorized by all necessary corporate
action and do not (i) violate the Company's charter, bylaws or any applicable
law, or (ii) breach or result in an event of default under any indenture or
material agreement, and do not result in or require the creation of any Lien
upon or with respect to any of its properties (except the lien of the Indenture
securing the Bonds and any Lien in favor of the Agent on the Facility LC
Collateral Account or any funds therein).
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5.3 Governmental Approvals. No authorization or approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the due execution, delivery and performance by
the Company of any Credit Document, except for the authorization to issue, sell
or guarantee secured and/or unsecured short-term debt granted by the Federal
Energy Regulatory Commission, which authorization has been obtained and is in
full force and effect.
5.4 Legally Enforceable Agreements. Each Credit Document
constitutes a legal, valid and binding obligation of the Company, enforceable in
accordance with its terms, subject to (a) the effect of applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and (b) the application of general
principles of equity (regardless of whether considered in a proceeding in equity
or at law).
5.5 Financial Statements. The audited balance sheet of the Company
and its Consolidated Subsidiaries as at December 31, 2002, and the related
statements of income and cash flows of the Company and its Consolidated
Subsidiaries for the fiscal year then ended, as set forth in the Company's
Annual Report on Form 10-K (copies of which have been furnished to each Bank),
and the unaudited restated balance sheet of the Company and its Consolidated
Subsidiaries as at June 30, 2003 (copies of which have been furnished to each
Bank) fairly present the financial condition of the Company and its Consolidated
Subsidiaries as at such dates and the results of operations of the Company and
its Consolidated Subsidiaries for the periods ended on such dates, all in
accordance with GAAP, and since December 31, 2002, there has been no material
adverse change in such financial condition or results of operations of the
Company and its Consolidated Subsidiaries, taken as a whole, that would
materially adversely affect the Company's ability to perform its obligations
under any Credit Document.
5.6 Litigation. Except (i) to the extent described in the
Company's Annual Report on Form 10-K for the year ended December 31, 2002 and
Quarterly Report on Form 10-Q for the quarter ended June 30, 2003, in each case
as filed with the SEC, and (ii) such other similar actions, suits and
proceedings predicated on the occurrence of the same events giving rise to any
actions, suits and proceedings described in the Reports referred to in the
foregoing clause (i) (all matters described in clauses (i) and (ii) above, the
"Disclosed Matters"), there is no pending or threatened action or proceeding
against the Company or any of its Consolidated Subsidiaries before any court,
governmental agency or arbitrator, which, if adversely determined, might
reasonably be expected to materially adversely affect the financial condition or
results of operations of the Company and its Consolidated Subsidiaries, taken as
a whole, or that would materially adversely affect the Company's ability to
perform its obligations under any Credit Document. As of the Initial Borrowing
Date, (a) there is no litigation challenging the validity or the enforceability
of any of the Credit Documents and (b) there have been no adverse developments
with respect to the Disclosed Matters that have had or could reasonably be
expected to result in a material adverse effect on the financial condition or
results of operations of the Company and its Consolidated Subsidiaries, taken as
a whole, or that would materially adversely affect the Company's ability to
perform its obligations under any Credit Document.
5.7 Margin Stock. The Company is not engaged in the business of
extending credit for the purpose of buying or carrying margin stock (within the
meaning of Regulation U), and no
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proceeds of any Credit Extension will be used to buy or carry any margin stock
or to extend credit to others for the purpose of buying or carrying any margin
stock.
5.8 ERISA. No Termination Event has occurred or is reasonably
expected to occur with respect to any Plan. Neither the Company nor any of its
ERISA Affiliates is an employer under a Multiemployer Plan.
5.9 Insurance. All insurance required by Section 6.2 is in full
force and effect.
5.10 Taxes. The Company and its Subsidiaries have filed all tax
returns (Federal, state and local) required to be filed and paid all taxes shown
thereon to be due, including interest and penalties, or, to the extent the
Company or any of its Subsidiaries is contesting in good faith an assertion of
liability based on such returns, has provided adequate reserves for payment
thereof in accordance with GAAP.
5.11 Investment Company Act. The Company is not an investment
company (within the meaning of the Investment Company Act of 1940, as amended).
5.12 Public Utility Holding Company Act. The Company is exempt from
the registration requirements of the Public Utility Holding Company Act of 1935,
as amended, 15 USC 79, et seq.
5.13 Bonds. The issuance to the Agent of Bonds as evidence of the
Obligations (i) will not violate any provision of the Indenture or any other
agreement or instrument, or any law or regulation, or judicial or regulatory
order, judgment or decree, to which the Company or any of its Subsidiaries is a
party or by which any of the foregoing is bound and (ii) will provide the Banks,
as beneficial holders of the Bonds through the Agent, the benefit of the Lien of
the Indenture equally and ratably with the holders of other First Mortgage
Bonds.
5.14 Disclosure. The Company has not withheld any fact from the
Agent or the Lenders in regard to the occurrence of a material adverse change in
the condition or results of operations of the Company and its Consolidated
Subsidiaries, taken as a whole, that would materially adversely affect the
Company's ability to perform its obligations under any Credit Document.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any Obligations shall remain unpaid or any Bank shall have
any Commitment under this Agreement, the Company shall:
6.1 Payment of Taxes, Etc. Pay and discharge before the same shall
become delinquent, (a) all taxes, assessments and governmental charges or levies
imposed upon it or upon its property, and (b) all lawful claims which, if
unpaid, might by law become a Lien upon its property, provided that the Company
shall not be required to pay or discharge any such tax, assessment, charge or
claim (i) which is being contested by it in good faith and by proper procedures
or (ii) the non-payment of which will not materially adversely affect the
financial
-27-
condition or results of operations of the Company and its Consolidated
Subsidiaries, taken as a whole.
6.2 Maintenance of Insurance. Maintain insurance in such amounts
and covering such risks with respect to its business and properties as is
usually carried by companies engaged in similar businesses and owning similar
properties, either with reputable insurance companies or, in whole or in part,
by establishing reserves or one or more insurance funds, either alone or with
other corporations or associations.
6.3 Preservation of Corporate Existence, Etc. Preserve and
maintain its corporate existence, rights and franchises, and qualify and remain
qualified as a foreign corporation in each jurisdiction in which such
qualification is necessary in view of its business and operations or the
ownership of its properties, provided that the Company shall not be required to
preserve any such right or franchise or to remain so qualified unless the
failure to do so would have a material adverse effect on the financial condition
or results of operations of the Company and its Consolidated Subsidiaries, taken
as a whole, or the ability of the Company to enter into, or to perform its
obligations under, any Credit Document.
6.4 Compliance with Laws, Etc. Comply with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority,
the non-compliance with which would materially adversely affect the financial
condition or results of operations of the Company and its Consolidated
Subsidiaries, taken as a whole, or the ability of the Company to perform its
obligations under any Credit Document.
6.5 Visitation Rights. Subject to any necessary approval from the
Nuclear Regulatory Commission, at any reasonable time and from time to time,
permit the Agent, any of the Banks or any agents or representatives thereof to
examine and make copies of and abstracts from its records and books of account,
visit its properties and discuss its affairs, finances and accounts with any of
its officers.
6.6 Keeping of Books. Keep, and cause each Consolidated Subsidiary
to keep, adequate records and books of account, in which full and correct
entries shall be made of all of its financial transactions and its assets and
business so as to permit the Company and its Consolidated Subsidiaries to
present financial statements in accordance with GAAP.
6.7 Reporting Requirements. Furnish to the Agent, with sufficient
copies for each of the Banks:
(a) as soon as practicable and in any event within five Business
Days after becoming aware of the occurrence of any Default or Event of Default,
a statement of a Designated Officer as to the nature thereof, and as soon as
practicable and in any event within five Business Days thereafter, a statement
of a Designated Officer as to the action which the Company has taken, is taking
or proposes to take with respect thereto;
(b) as soon as available and in any event within 60 days after the
end of each of the first three quarters of each fiscal year of the Company, a
consolidated balance sheet of the
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Company and its Consolidated Subsidiaries as at the end of such quarter, and the
related consolidated statements of income, cash flows and common stockholder's
equity of the Company and its Consolidated Subsidiaries as at the end of and for
the period commencing at the end of the previous fiscal year and ending with the
end of such quarter, setting forth in each case in comparative form the
corresponding figures for the corresponding date or period of the preceding
fiscal year, or statements providing substantially similar information (which
requirement shall be deemed satisfied by the delivery of the Company's quarterly
report of Form 10-Q for such quarter), all in reasonable detail and duly
certified (subject to the absence of footnotes and to year-end audit
adjustments) by a Designated Officer as having been prepared in accordance with
GAAP, together with (i) a certificate of a Designated Officer (which certificate
shall also accompany the financial statements delivered pursuant to clause (c)
below) stating that such officer has no knowledge (having made due inquiry with
respect thereto) that a Default or Event of Default has occurred and is
continuing, or, if a Default or Event of Default has occurred and is continuing,
a statement as to the nature thereof and the actions which the Company has
taken, is taking or proposes to take with respect thereto, and (ii) a
certificate of a Designated Officer, in substantially the form of Exhibit C
hereto, setting forth the Company's computation of the financial ratios
specified in Sections 8.1 and 8.2 as of the end of the immediately preceding
fiscal quarter or year, as the case may be, of the Company;
(c) as soon as available and in any event within 120 days after
the end of each fiscal year of the Company, a copy of the Annual Report on Form
10-K (or any successor form) for the Company for such year, including therein
the consolidated balance sheet of the Company and its Consolidated Subsidiaries
as at the end of such year and the consolidated statements of income, cash flows
and common stockholder's equity of the Company and its Consolidated Subsidiaries
as at the end of and for such year, or statements providing substantially
similar information, in each case certified by independent public accountants of
recognized national standing selected by the Company (and not objected to by the
Majority Banks), together with a certificate of such accounting firm addressed
to the Banks stating that, in the course of its examination of the consolidated
financial statements of the Company and its Consolidated Subsidiaries, which
examination was conducted by such accounting firm in accordance with GAAP, (1)
such accounting firm has obtained no knowledge that an Event of Default, insofar
as such Event of Default related to accounting or financial matters, has
occurred and is continuing, or if, in the opinion of such accounting firm, such
an Event of Default has occurred and is continuing, a statement as to the nature
thereof, and (2) such accounting firm has examined a certificate prepared by the
Company setting forth the computations made by the Company in determining, as of
the end of such fiscal year, the ratios specified in Sections 8.1 and 8.2, which
certificate shall be attached to the certificate of such accounting firm, and
such accounting firm confirms that such computations accurately reflect such
ratios;
(d) promptly after the sending or filing thereof, copies of all
proxy statements which the Company sends to its stockholders, copies of all
regular, periodic and special reports (other than those which relate solely to
employee benefit plans) which the Company files with the SEC and notice of the
sending or filing of (and, upon the request of the Agent or any Bank, a copy of)
any final prospectus filed with the SEC;
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(e) as soon as possible and in any event (i) within 30 days after
the Company or any of its ERISA Affiliates knows or has reason to know that any
Termination Event described in clause (a) of the definition of Termination Event
with respect to any Plan has occurred and (ii) within ten days after the Company
or any of its ERISA Affiliates knows or has reason to know that any other
Termination Event with respect to any Plan has occurred, a statement of the
Chief Financial Officer of the Company describing such Termination Event and the
action, if any, which the Company or such ERISA Affiliate, as the case may be,
proposes to take with respect thereto;
(f) promptly upon becoming aware thereof, notice of any upgrading
or downgrading of the rating of the Senior Debt by Fitch, ▇▇▇▇▇'▇ or S&P;
(g) as soon as possible and in any event within five (5) days
after the occurrence of any material default under any material agreement to
which the Company or any of its Subsidiaries is a party, which default would
materially adversely affect the financial condition, business, results of
operations or property of the Company and its Subsidiaries, considered as a
whole, any of which is continuing on the date of such certificate, a certificate
of the president or chief financial officer of the Company setting forth the
details of such material default and the action which the Company or any such
Subsidiary proposes to take with respect thereto; and
(h) such other information respecting the business, properties or
financial condition of the Company as the Agent or any Bank through the Agent
may from time to time reasonably request.
6.8 Use of Proceeds. The Company will use the proceeds of the
Credit Extensions for general corporate purposes, working capital and
refinancing the Debt under the Prior Agreement. The Company will not, nor will
it permit any Subsidiary to, use any of the proceeds of the Credit Extensions to
purchase or carry any "margin stock" (as defined in Regulation U).
6.9 Maintenance of Properties, Etc. The Company shall, and shall
cause each of its Subsidiaries to, maintain in all material respects all of its
respective owned and leased Property in good and safe condition and repair to
the same degree as other companies engaged in similar businesses and owning
similar properties, and not permit, commit or suffer any waste or abandonment of
any such Property, and from time to time make or cause to be made all material
repairs, renewals and replacements thereof, including, without limitation, any
capital improvements which may be required; provided, however, that such
Property may be altered or renovated in the ordinary course of the Company's or
its Subsidiaries' business; and provided, further, that the foregoing shall not
restrict the sale of any asset of the Company or any Subsidiary to the extent
not prohibited by Section 7.2.
6.10 Bonds. Beginning on the Initial Borrowing Date and continuing
until the Commitments have terminated and all Obligations have been paid in
full, cause the face amount of all Bonds to at all times be equal to or greater
than the Aggregate Outstanding Credit Exposure.
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ARTICLE VII
NEGATIVE COVENANTS
So long as any Obligations shall remain unpaid or any Bank shall have
any Commitment under this Agreement, the Company shall not:
7.1 Liens. Create, incur, assume or suffer to exist any Lien upon
or with respect to any of its properties, now owned or hereafter acquired,
except:
(a) Liens created pursuant to the Indenture securing the First
Mortgage Bonds and any Lien in favor of the Agent on the Facility LC Collateral
Account or any funds therein;
(b) Liens securing pollution control bonds, or bonds issued to
refund or refinance pollution control bonds (including Liens securing
obligations (contingent or otherwise) of the Company under letter of credit
agreements or other reimbursement or similar credit enhancement agreements with
respect to pollution control bonds), provided that the aggregate face amount of
any such bonds so issued shall not exceed the aggregate face amount of such
pollution control bonds, as the case may be, so refunded or refinanced;
(c) Liens in (and only in) assets acquired to secure Debt incurred
to finance the acquisition of such assets;
(d) Statutory and common law banker's Liens on bank deposits;
(e) Liens in respect of accounts receivable sold, transferred or
assigned by the Company;
(f) Liens for taxes, assessments or other governmental charges or
levies not at the time delinquent or thereafter payable without penalty or being
contested in good faith by appropriate proceedings and for which adequate
reserves in accordance with GAAP shall have been set aside on its books;
(g) Liens of carriers, warehousemen, mechanics, materialmen and
landlords incurred in the ordinary course of business for sums not overdue or
being contested in good faith by appropriate proceedings and for which adequate
reserves shall have been set aside on its books;
(h) Liens incurred in the ordinary course of business in
connection with workers' compensation, unemployment insurance or other forms of
governmental insurance or benefits, or to secure performance of tenders,
statutory obligations, leases and contracts (other than for borrowed money)
entered into in the ordinary course of business or to secure obligations on
surety or appeal bonds;
(i) Judgment Liens in existence less than 30 days after the entry
thereof or with respect to which execution has been stayed or the payment of
which is covered (subject to a customary deductible) by insurance;
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(j) Zoning restrictions, easements, licenses, covenants,
reservations, utility company rights, restrictions on the use of real property
or minor irregularities of title incident thereto which do not in the aggregate
materially detract from the value of the property or assets of the Company or
materially impair the operation of its business;
(k) Liens arising in connection with the financing of the
Company's fuel resources, including, but not limited to, nuclear fuel;
(l) Liens arising pursuant to M.C.L. 324.20138; provided that the
aggregate amount of all obligations secured by such Liens (excluding any such
Liens of which the Company has no knowledge or which are permitted by subsection
(f) above) shall not exceed $20,000,000;
(m) Liens arising in connection with Securitized Bonds;
(n) Liens on natural gas, oil and mineral, or on stock in trade,
material or supplies manufactured or acquired for the purpose of sale and or
resale in the usual course of business or consumable in the operation of any of
the properties of the Company; provided that such Liens secure obligations not
exceeding $500,000,000 in aggregate principal amount;
(o) Other Liens securing obligations in an aggregate amount not in
excess of $150,000,000.
7.2 Sale of Assets. Sell, lease, assign, transfer or otherwise
dispose of 15% or more of its assets calculated with reference to total assets
as reflected on the Company's consolidated balance sheet as at December 31,
2002, during the term of this Agreement.
7.3 Mergers, Etc. Merge with or into or consolidate with or into
any other Person, except that the Company may merge with any other Person,
provided that, in each case, immediately after giving effect thereto, (a) no
event shall occur and be continuing which constitutes a Default or Event of
Default, (b) the Company is the surviving corporation, (c) the Company shall not
be liable with respect to any Debt or allow its Property to be subject to any
Lien which it could not become liable with respect to or allow its Property to
become subject to under this Agreement on the date of such transaction and (d)
the Company's Net Worth shall be equal to or greater than its Net Worth
immediately prior to such merger.
7.4 Compliance with ERISA. Permit to exist any occurrence of any
Reportable Event, or any other event or condition which presents a material (in
the reasonable opinion of the Majority Banks) risk of a termination by the PBGC
of any Plan of the Company or any ERISA Affiliate, which termination will result
in any material (in the reasonable opinion of the Majority Banks) liability of
the Company or such ERISA Affiliate to the PBGC.
7.5 Change in Nature of Business. Make any material change in the
nature of its business as carried on as of the date hereof.
7.6 Restricted Payments. The Company: (a) will not declare or pay
any dividends or make any other distributions on its capital stock (other than
dividends payable solely in such capital stock) or redeem any such capital
stock; and (b) will not, and will not permit any
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Subsidiary to, purchase or otherwise acquire or retire any of the Company's
capital stock or make any loans or advances to CMS or any Subsidiary thereof
(other than the Company or any Subsidiary thereof); provided that, so long as no
Default or Event of Default exists, the Company may pay dividends in an
aggregate amount not to exceed $300,000,000 during any calendar year.
7.7 Off-Balance Sheet Liabilities. Create, incur, assume or suffer
to exist, or permit any Subsidiary to create, incur, assume or suffer to exist,
Off-Balance Sheet Liabilities (exclusive of obligations arising in connection
with (a) the Purchase Agreement among the Company, Consumers Receivables Funding
II, LLC, Falcon Asset Securitization Corporation and Bank One, dated as of May
22, 2003, as amended, restated or otherwise modified from time to time and any
similar agreement entered into in replacement thereof, and (b) the Master Lease
and Lease Supplement, each dated as of April 23, 2001, between Consumers Campus
Holding, LLC (a wholly-owned Subsidiary of the Company), as lessee, and
Wilmington Trust Company, not in its individual capacity but solely as Owner
Trustee of CEC Trust 2001-A, as lessor, along with various other related
agreements), as amended, restated or otherwise modified from time to time and
any similar agreement entered into in replacement thereof) in the aggregate in
excess of $250,000,000 at any time.
7.8 Transactions with Affiliates. Enter into, or permit any
Subsidiary to enter into, any transaction with any of its Affiliates (other than
the Company or any Subsidiary) unless such transaction is on terms no less
favorable to the Company or such Subsidiary than if the transaction had been
negotiated in good faith on an arm's-length basis with a non-Affiliate; provided
that any transaction permitted under Section 7.6 shall be permitted hereunder.
ARTICLE VIII
FINANCIAL COVENANTS
So long as any of the Obligations shall remain unpaid or any Bank shall
have any Commitment under this Agreement, the Company shall:
8.1 Debt to Capital Ratio. At all times, maintain a ratio of Total
Consolidated Debt to Total Consolidated Capitalization of not greater than 0.65
to 1.0.
8.2 Interest Coverage Ratio. Not permit the ratio, determined as
of the end of each of its fiscal quarters for the then most-recently ended four
fiscal quarters, of (i) Consolidated EBIT to (ii) Consolidated Interest Expense
to be less than 2.0 to 1.0.
ARTICLE IX
EVENTS OF DEFAULT
9.1 Events of Default. The occurrence of any of the following
events shall constitute an "Event of Default":
(a) The Company shall fail to pay (i) any principal of any Advance
when due and payable, or (ii) any Reimbursement Obligation within one (1) day
after the same becomes due, or (iii) any interest on any Advance or any fee or
other Obligation payable hereunder within five (5) days after such interest or
fee or other Obligation becomes due and payable;
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(b) Any representation or warranty made by the Company (or any of
its officers) in this Agreement or any other Credit Document or in any
certificate, document, report, financial or other written statement furnished at
any time pursuant to any Credit Document shall prove to have been incorrect in
any material respect on or as of the date made;
(c) The Company shall fail to perform or observe any term,
covenant or agreement contained in Section 6.10, Article VII or Article VIII; or
the Company shall fail to perform or observe any other term, covenant or
agreement on its part to be performed or observed in this Agreement or in any
other Credit Document and such failure shall continue for 30 consecutive days
after the earlier of (i) a Designated Officer obtaining knowledge of such breach
and (ii) written notice thereof by means of facsimile, regular mail or written
notice delivered in person (or telephonic notice thereof confirmed in writing)
shall have been given to the Company by the Agent or the Majority Banks;
(d) The Company shall: (i) fail to pay any Debt (other than the
payment obligations described in subsection (a) above) in excess of $25,000,000,
or any interest or premium thereon, when due (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise) and such failure shall
continue after the applicable grace period, if any, specified in the instrument
or agreement relating to such Debt; or (ii) fail to perform or observe any term,
covenant or condition on its part to be performed or observed under any
agreement or instrument relating to any such Debt, when required to be performed
or observed, if the effect of such failure to perform or observe is to
accelerate, or to permit the acceleration of, the maturity of such Debt, unless
the obligee under or holder of such Debt shall have waived in writing such
circumstance, or such circumstance has been cured, so that such circumstance is
no longer continuing; or (iii) any such Debt shall be declared to be due and
payable, or required to be prepaid (other than by a regularly scheduled required
prepayment), in each case in accordance with the terms of such agreement or
instrument, prior to the stated maturity thereof; or (iv) generally not, or
shall admit in writing its inability to, pay its debts as such debts become due;
(e) The Company: (i) shall make an assignment for the benefit of
creditors, or petition or apply to any tribunal for the appointment of a
custodian, receiver or trustee for it or a substantial part of its assets; or
(ii) shall commence any proceeding under any bankruptcy, reorganization,
arrangement, readjustment of debt, dissolution or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect; or (iii) shall have had
any such petition or application filed or any such proceeding shall have been
commenced, against it, in which an adjudication or appointment is made or order
for relief is entered, or which petition, application or proceeding remains
undismissed for a period of 30 consecutive days or more; or (iv) by any act or
omission shall indicate its consent to, approval of or acquiescence in any such
petition, application or proceeding or order for relief or the appointment of a
custodian, receiver or trustee for all or any substantial part of its property;
or (v) shall suffer any such custodianship, receivership or trusteeship to
continue undischarged for a period of 30 days or more; or (vi) shall take any
corporate action to authorize any of the actions set forth above in this
subsection (e);
(f) One or more judgments, decrees or orders for the payment of
money in excess of $25,000,000 in the aggregate shall be rendered against the
Company and either (i) enforcement proceedings shall have been commenced by any
creditor upon any such judgment or order or (ii)
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there shall be any period of more than 30 consecutive days during which a stay
of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect;
(g) Any Termination Event with respect to a Plan shall have
occurred, and 30 days after notice thereof shall have been given to the Company
by the Agent, (i) such Termination Event (if correctable) shall not have been
corrected and (ii) the then present value of such Plan's vested benefits exceeds
the then current value of the assets accumulated in such Plan by more than the
amount of $25,000,000 (or in the case of a Termination Event involving the
withdrawal of a "substantial employer" (as defined in Section 4001(A)(2) of
ERISA), the withdrawing employer's proportionate share of such excess shall
exceed such amount).
(h) Any Bond shall cease to be in full force and effect (except
for Bonds surrendered by the Agent pursuant to Section 2.5(b)); or the Company
shall deny that it has any liability or obligation under any Bond or purport to
revoke, terminate, rescind or redeem any Bond (other than in accordance with the
terms of the Bonds and the Indenture).
9.2 Remedies.
(a) If any Event of Default shall occur and be continuing, the
Agent shall upon the request, or may with the consent, of the Majority Banks, by
notice to the Company, (i) declare the Commitments and the obligation and power
of the LC Issuer to issue Facility LCs to be terminated or suspended, whereupon
the same shall forthwith terminate, and/or (ii) declare the Obligations to be
forthwith due and payable, whereupon the Aggregate Outstanding Credit Exposure
and all other Obligations shall become and be forthwith due and payable, and/or
(iii) in addition to the continuing right to demand payment of all amounts
payable under this Agreement, make demand on the Company to pay, and the Company
will, forthwith upon such demand and without any further notice or act, pay to
the Agent the Collateral Shortfall Amount (as defined below), which funds shall
be deposited in the Facility LC Collateral Account, in each case without
presentment, demand, protest or further notice of any kind, all of which are
hereby expressly waived by the Company, provided that in the case of an Event of
Default referred to in subsection 9.1(e) above, the Commitments shall
automatically terminate, the obligation and power of the LC Issuer to issue
Facility LCs shall automatically terminate and the Obligations shall
automatically become due and payable without notice, presentment, demand,
protest or other formalities of any kind, all of which are hereby expressly
waived by the Company, and the Company will be and become thereby
unconditionally obligated, without any further notice, act or demand, to pay to
the Agent an amount in immediately available funds, which funds shall be held in
the Facility LC Collateral Account, equal to the difference of (x) the amount of
LC Obligations at such time, less (y) the amount on deposit in the Facility LC
Collateral Account at such time which is free and clear of all rights and claims
of third parties and has not been applied against the Obligations (such
difference, the "Collateral Shortfall Amount").
(b) If at any time while any Event of Default is continuing, the
Agent determines that the Collateral Shortfall Amount at such time is greater
than zero, the Agent may make demand on the Company to pay, and the Company
will, forthwith upon such demand and without any further notice or act, pay to
the Agent the Collateral Shortfall Amount, which funds shall be deposited in the
Facility LC Collateral Account.
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(c) The Agent may, at any time or from time to time after funds
are deposited in the Facility LC Collateral Account, apply such funds to the
payment of the Obligations and any other amounts as shall from time to time have
become due and payable by the Company to the Banks or the LC Issuer under the
Credit Documents. The Company hereby pledges, assigns and grants to the Agent,
on behalf of and for the ratable benefit of the Banks and the LC Issuer, a
security interest in all of the Company's right, title and interest in and to
all funds which may from time to time be on deposit in the Facility LC
Collateral Account to secure the prompt and complete payment and performance of
the Obligations. The Agent will invest any funds on deposit from time to time in
the Facility LC Collateral Account in certificates of deposit of Bank One having
a maturity not exceeding 30 days.
(d) At any time while any Event of Default is continuing, neither
the Company nor any Person claiming on behalf of or through the Company shall
have any right to withdraw any of the funds held in the Facility LC Collateral
Account. After all of the Obligations have been indefeasibly paid in full and
the Aggregate Commitment has been terminated, any funds remaining in the
Facility LC Collateral Account shall be returned by the Agent to the Company or
paid to whomever may be legally entitled thereto at such time.
ARTICLE X
WAIVERS, AMENDMENTS AND REMEDIES
10.1 Amendments. Subject to the provisions of this Article X, the
Majority Banks (or the Agent with the consent in writing of the Majority Banks)
and the Company may enter into written agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Credit Documents or
changing in any manner the rights of the Banks or the Company hereunder or
waiving any Event of Default hereunder, provided that no such supplemental
agreement shall, without the consent of all of the Banks:
(a) Extend the maturity of any Loan or reduce the
principal amount thereof, or extend the expiry date of any Facility LC
to a date after the Termination Date, or reduce the rate or extend the
time of payment of interest thereon or fees thereon or Reimbursement
Obligations related thereto.
(b) Modify the percentage specified in the definition of
Majority Banks.
(c) Extend the Termination Date or increase the amount of
the Commitment of any Bank hereunder or the commitment to issue
Facility LCs, or permit the Company to assign its rights under this
Agreement.
(d) Amend Section 6.10 or this Section 10.1.
(e) Make any change in an express right in this Agreement
of a single Bank to give its consent, make a request or give a notice.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent, and no amendment of any
provision relating to the LC Issuer shall be effective without the written
consent of the LC Issuer.
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10.2 Preservation of Rights. No delay or omission of the Banks, the
LC Issuer or the Agent to exercise any right under the Credit Documents shall
impair such right or be construed to be a waiver of any Default or Event of
Default or an acquiescence therein, and the making of a Credit Extension
notwithstanding the existence of a Default or Event of Default or the inability
of the Company to satisfy the conditions precedent to such Credit Extension
shall not constitute any waiver or acquiescence. Any single or partial exercise
of any such right shall not preclude other or further exercise thereof or the
exercise of any other right, and no waiver, amendment or other variation of the
terms, conditions or provisions of the Credit Documents whatsoever shall be
valid unless in writing signed by the Banks required pursuant to Section 10.1,
and then only to the extent in such writing specifically set forth. All remedies
contained in the Credit Documents or by law afforded shall be cumulative and all
shall be available to the Agent, the LC Issuer and the Banks until the
Obligations have been paid in full.
ARTICLE XI
CONDITIONS PRECEDENT
11.1 Initial Credit Extension. The Banks shall not be required to
make the initial Credit Extension hereunder unless the Company has furnished to
the Agent with sufficient copies for the Banks:
(a) Copies of the Restated Articles of Incorporation of the
Company, together with all amendments, certified by the Secretary or an
Assistant Secretary of the Company, and a certificate of good standing,
certified by the appropriate governmental officer in its jurisdiction of
incorporation.
(b) Copies, certified by the Secretary or an Assistant Secretary
of the Company, of its bylaws and of its Board of Directors' resolutions (and
resolutions of other bodies, if any are deemed necessary by counsel for any
Bank) authorizing the execution of the Credit Documents.
(c) An incumbency certificate, executed by the Secretary or an
Assistant Secretary of the Company, which shall identify by name and title and
bear the original or facsimile signature of the officers of the Company
authorized to sign the Credit Documents and the officers or other employees
authorized to make borrowings hereunder, upon which certificate the Banks shall
be entitled to rely until informed of any change in writing by the Company.
(d) A certificate, signed by a Designated Officer of the Company,
stating that on the date hereof no Default or Event of Default has occurred and
is continuing.
(e) Evidence satisfactory to the Agent of the issuance of the
Bonds in the form set forth in the Supplemental Indenture and in an aggregate
principal amount of $400,000,000 pursuant to the Bond Delivery Agreement.
(f) Favorable opinions of: (i) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq., Deputy
General Counsel of the Company, as to the matters set forth in Exhibit B-1 and
as to such other matters as the Agent may reasonably request; (ii) Skadden,
Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP, special counsel to the Company, as to the
matters set forth in Exhibit B-2 and as to such other matters as the
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Agent may reasonably request; and (iii) Miller, Canfield, Paddock and Stone,
P.L.C., as to the matters set forth in Exhibit B-3 and as to such other matters
as the Agent may reasonably request. Such opinions shall be addressed to the
Agent and the Banks and shall be satisfactory in form and substance to the
Agent.
(g) Evidence satisfactory to the Agent that the Prior Agreement
shall have been or shall simultaneously on the Initial Borrowing Date be
terminated (except for those provisions that expressly survive the termination
thereof) and all loans outstanding and other amounts owed to the lenders or
agents thereunder shall have been, or shall simultaneously with the initial
Credit Extension hereunder be, paid in full.
(h) Evidence, in form and substance satisfactory to the Agent,
that the Company has obtained all governmental approvals, if any, necessary for
it to enter into the Credit Documents.
(i) Such other documents as any Bank or its counsel may have
reasonably requested.
It shall be a further condition precedent to the making of the initial Credit
Extension hereunder that the Company shall have paid (i) to the Agent for the
account of the Banks the fees required to be paid on the Initial Borrowing Date
and (ii) to the Agent and the Arranger the fees required to be paid to them
pursuant to the fee letter described in Section 13.12.
11.2 Each Credit Extension. The Banks shall not be required to make
any Credit Extension if on the applicable Borrowing Date, (i) any Default or
Event of Default exists, (ii) any representation or warranty contained in
Article V is not true and correct as of such Borrowing Date, (iii) after giving
effect to such Credit Extension the Aggregate Outstanding Credit Exposure would
exceed the face amount of all Bonds or (iv) all legal matters incident to the
making of such Credit Extension are not satisfactory to the Banks and their
counsel. Each Borrowing Notice and each request for issuance of a Facility LC
shall constitute a representation and warranty by the Company that the
conditions contained in subsections (i), (ii) and (iii) above will be satisfied
on the relevant Borrowing Date. For the avoidance of doubt, the conversion or
continuation of an Advance shall not be considered the making of a Credit
Extension.
ARTICLE XII
GENERAL PROVISIONS
12.1 Successors and Assigns. (a) The terms and provisions of the
Credit Documents shall be binding upon and inure to the benefit of the Company
and the Banks and their respective successors and assigns, except that the
Company shall not have the right to assign its rights under the Credit
Documents. Any Bank may sell participations in all or a portion of its rights
and obligations under this Agreement pursuant to subsection (b) below and any
Bank may assign all or any part of its rights and obligations under this
Agreement pursuant to subsection (c) below.
(b) Any Bank may sell participations to one or more banks or other
entities (each a "Participant") in all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment and its Outstanding Credit Exposure), provided that
(i) such Bank's obligations under this Agreement (including, without limitation,
its
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Commitment to the Company hereunder) shall remain unchanged, (ii) such Bank
shall remain solely responsible to the other parties hereto for the performance
of such obligations, (iii) such Bank shall remain the holder of the Outstanding
Credit Exposure of such Bank for all purposes of this Agreement and (iv) the
Company shall continue to deal solely and directly with such Bank in connection
with such Bank's rights and obligations under this Agreement. Each Bank shall
retain the sole right to approve, without the consent of any Participant, any
amendment, modification or waiver of any provision of the Credit Documents other
than any amendment, modification or waiver with respect to any Loan or
Commitment in which such Participant has an interest which would require consent
of all of the Banks pursuant to the terms of Section 10.1 or of any other Credit
Document. The Company agrees that each Participant shall be deemed to have the
right of setoff provided in Section 12.10 in respect of its participating
interest in amounts owing under the Credit Documents to the same extent as if
the amount of its participating interest were owing directly to it as a Bank
under the Credit Documents, provided that each Bank shall retain the right of
setoff provided in Section 12.10 with respect to the amount of participating
interests sold to each Participant. The Banks agree to share with each
Participant, and each Participant, by exercising the right of setoff provided in
Section 12.10, agrees to share with each Bank, any amount received pursuant to
the exercise of its right of setoff, such amounts to be shared in accordance
with Section 12.10 as if each Participant were a Bank. The Company further
agrees that each Participant shall be entitled to the benefits of Sections 4.1,
4.3, 4.4 and 4.5 to the same extent as if it were a Bank and had acquired its
interest by assignment pursuant to Section 12.1(c), provided that (i) a
Participant shall not be entitled to receive any greater payment under Section
4.1, 4.3, 4.4 or 4.5 than the Bank who sold the participating interest to such
Participant would have received had it retained such interest for its own
account, unless the sale of such interest to such Participant is made with the
prior written consent of the Company, and (ii) any Participant not incorporated
under the laws of the United States of America or any State thereof agrees to
comply with the provisions of Section 4.5 to the same extent as if it were a
Bank.
(c) Any Bank may, in the ordinary course of its business and in
accordance with applicable law, at any time assign to one or more financial
institutions all or any part of its rights and obligations under this Agreement,
provided that (i) unless such assignment is to another Bank or an affiliate of
the assigning Bank, such Bank has received the Agent's and, so long as no Event
of Default exists, the Company's prior written consent to such assignment, which
consent shall not be unreasonably withheld, and (ii) the minimum principal
amount of any such assignment (other than assignments to a Federal Reserve Bank,
or to any other Bank or affiliate of such assigning Bank, or to any direct or
indirect contractual counterparties in swap agreements relating to the Loans to
the extent required in connection with the physical settlement of any Bank's
obligations pursuant thereto) shall be $5,000,000 (or such lesser amount
consented to by the Agent and, so long as no Event of Default shall be
continuing, the Company); provided, that after giving effect to such assignment
the assigning Bank shall have a Commitment of not less than $5,000,000 (unless
otherwise consented to by the Agent and, so long as no Event of Default shall be
continuing, the Company). Notwithstanding the foregoing sentence, any Bank may
at any time, without the consent of the Company or the Agent, assign all or any
portion of its rights under this Agreement to (i) a Federal Reserve Bank,
provided that no such assignment shall release the transferor Bank from its
obligations hereunder; and (ii) any Bank or any affiliate
-39-
of such assigning Bank, provided that the creditworthiness of such affiliate (as
determined in accordance with customary standards of the banking industry) is no
less than that of the assigning Bank; and (iii) any direct or indirect
contractual counterparties in swap agreements relating to the Loans to the
extent required in connection with the physical settlement of any Bank's
obligations pursuant thereto.
(d) Any Bank may, in connection with any sale or participation or
proposed sale or participation pursuant to this Section 12.1, disclose to the
purchaser or participant or proposed purchaser or participant any information
relating to the Company furnished to such Bank by or on behalf of the Company,
provided that prior to any such disclosure of non-public information, the
purchaser or participant or proposed purchaser or participant (which purchaser
or participant is not an affiliate of a Bank) shall agree to preserve the
confidentiality of any confidential information (except any such disclosure as
may be required by law or regulatory process) relating to the Company received
by it from such Bank.
(e) Assignments under this Section 12.1 shall be made pursuant to
an agreement ("Assignment Agreement") substantially in the form of Exhibit D
hereto or in such other form as may be agreed to by the parties thereto and
shall not be effective until a $3,500 fee has been paid to the Agent by the
assignee, which fee shall cover the cost of processing such assignment, provided
that such fee shall not be incurred in the event of an assignment by any Bank of
all or a portion of its rights under this Agreement to (i) a Federal Reserve
Bank or (ii) a Bank or an affiliate of the assigning Bank or (iii) to any direct
or indirect contractual counterparties in swap agreements relating to the Loans
to the extent required in connection with the physical settlement of any Bank's
obligations pursuant thereto.
12.2 Survival of Representations. All representations and
warranties of the Company contained in this Agreement shall survive the making
of the Credit Extensions herein contemplated.
12.3 Governmental Regulation. Anything contained in this Agreement
to the contrary notwithstanding, neither the LC Issuer nor any Bank shall be
obligated to extend credit to the Company in violation of any limitation or
prohibition provided by any applicable statute or regulation.
12.4 Taxes. Any taxes (excluding income taxes) payable or ruled
payable by any Federal or State authority in respect of the execution of the
Credit Documents shall be paid by the Company, together with interest and
penalties, if any.
12.5 Choice of Law. THE CREDIT DOCUMENTS SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (INCLUDING, WITHOUT LIMITATION SECTION 5-1401
OF THE GENERAL OBLIGATIONS LAW OF NEW YORK, BUT OTHERWISE WITHOUT REGARD TO THE
LAW OF CONFLICTS) OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS. THE COMPANY HEREBY IRREVOCABLY SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT
SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR
-40-
PROCEEDING ARISING OUT OF OR RELATING TO ANY CREDIT DOCUMENT AND THE COMPANY
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT. THE COMPANY HEREBY
WAIVES ANY RIGHT TO A JURY TRIAL IN ANY ACTION OR ARISING HEREUNDER OR UNDER ANY
CREDIT DOCUMENT.
12.6 Headings. Section headings in the Credit Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Credit Documents.
12.7 Entire Agreement. The Credit Documents embody the entire
agreement and understanding between the Company, the LC Issuer, the Agent and
the Banks and supersede all prior agreements and understandings between the
Company, the LC Issuer, the Agent and the Banks relating to the subject matter
thereof (other than those contained in the fee letter described in Section 13.12
which shall survive and remain in full force and effect during the term of this
Agreement).
12.8 Expenses; Indemnification. The Company shall reimburse the
Agent and the Arranger for (a) any reasonable costs, internal charges and
out-of-pocket expenses (including reasonable attorneys' fees and time charges of
attorneys for the Agent) paid or incurred by the Agent or the Arranger in
connection with the preparation, review, execution, delivery, syndication,
distribution (including, without limitation, via the internet), amendment and
modification of the Credit Documents and (b) any reasonable costs, internal
charges and out-of-pocket expenses (including reasonable attorneys' fees and
time charges of attorneys for the Agent) paid or incurred by the Agent or the
Arranger on its own behalf or on behalf of the LC Issuer or any Bank and, on or
after the date upon which an Event of Default specified in Sections 9.1(a) and
9.1(e) has occurred and is continuing, each Bank, in connection with the
collection and enforcement of the Credit Documents. The Company further agrees
to indemnify the Agent, the Arranger, the LC Issuer and each Bank and their
respective directors, officers and employees against all losses, claims,
damages, penalties, judgments, liabilities and reasonable expenses (including,
without limitation, all material expenses of litigation or preparation therefor
whether or not the Agent, the Arranger, the LC Issuer or any Bank is a party
thereto) which any of them may pay or incur arising out of or relating to this
Agreement, the other Credit Documents, the transactions contemplated hereby or
the direct or indirect application or proposed application of the proceeds of
any Credit Extension hereunder, provided that the Company shall not be liable to
any Person for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of such Person. The obligations of the Company
under this Section shall survive the termination of this Agreement.
12.9 Severability of Provisions. Any provision in any Credit
Document that is held to be inoperative, unenforceable or invalid in any
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable or
invalid without affecting the remaining provisions in that jurisdiction or the
operation, enforceability or validity of that provision in any other
jurisdiction, and to this end the provisions of all Credit Documents are
declared to be severable.
-41-
12.10 Setoff. In addition to, and without limitation of, any rights
of the Banks under applicable law, if the Company becomes insolvent, however
evidenced, or any Default or Event of Default occurs, any indebtedness from any
Bank to the Company (including all account balances, whether provisional or
final and whether or not collected or available) may be offset and applied
toward the payment of the Obligations owing to such Bank, whether or not the
Obligations, or any part hereof, shall then be due. The Company agrees that any
purchaser or participant under Section 12.1 may, to the fullest extent permitted
by law, exercise all its rights of payment with respect to such purchase or
participation as if it were the direct creditor of the Company in the amount of
such purchase or participation.
12.11 Ratable Payments. If any Bank, whether by setoff or otherwise,
has payment made to it upon its Outstanding Credit Exposure in a greater
proportion than that received by any other Bank, such Bank agrees, promptly upon
demand, to purchase a portion of the Aggregate Outstanding Credit Exposure held
by the other Banks so that after such purchase each Bank will hold its Pro Rata
Share of the Aggregate Outstanding Credit Exposure. If any Bank, whether in
connection with setoff or amounts which might be subject to setoff or otherwise,
receives collateral or other protection for its Obligations or such amounts
which may be subject to setoff, such Bank agrees, promptly upon demand, to take
such action necessary such that all Banks share in the benefits of such
collateral ratably in proportion to their respective Pro Rata Share of the
Aggregate Outstanding Credit Exposure. In case any such payment is disturbed by
legal process, or otherwise, appropriate further adjustments shall be made.
12.12 Nonliability of Bank. The relationship between the Company, on
the one hand, and the Banks, the LC Issuer and the Agent, on the other hand,
shall be solely that of borrower and lender. Neither the Agent, the Arranger,
the LC Issuer nor any Bank shall have any fiduciary responsibilities to the
Company. Neither the Agent, the Arranger, the LC Issuer nor any Bank undertakes
any responsibility to the Company to review or inform the Company of any matter
in connection with any phase of the Company's business or operations. The
Company shall rely entirely upon its own judgment with respect to its business,
and any review, inspection, supervision or information supplied to the Company
by the Banks is for the protection of the Banks and neither the Company nor any
third party is entitled to rely thereon. The Company agrees that neither the
Agent, the Arranger, the LC Issuer nor any Bank shall have liability to the
Company (whether sounding in tort, contract or otherwise) for losses suffered by
the Company in connection with, arising out of, or in any way related to, the
transactions contemplated and the relationship established by the Credit
Documents, or any act, omission or event occurring in connection therewith,
unless it is determined in a final non-appealable judgment by a court of
competent jurisdiction that such losses resulted from the gross negligence or
willful misconduct of the party from which recovery is sought. Neither the
Agent, the Arranger, the LC Issuer nor any Bank shall have any liability with
respect to, and the Company hereby waives, releases and agrees not to ▇▇▇ for,
any special, indirect, consequential or punitive damages suffered by the Company
in connection with, arising out of, or in any way related to the Credit
Documents or the transactions contemplated thereby.
12.13 Other Agents. The Banks identified on the signature pages of
this Agreement or otherwise herein, or in any amendment hereof or other document
related hereto, as being "Co-Documentation Agents" (the "Other Agents"), shall
have no rights, powers, obligations,
-42-
liabilities, responsibilities or duties under this Agreement other than those
applicable to all Banks as such. Without limiting the foregoing, the Other
Agents shall not have or be deemed to have any fiduciary relationship with any
Bank. Each Bank acknowledges that it has not relied, and will not rely, on the
Other Agents in deciding to enter into this Agreement or in taking or refraining
from taking any action hereunder or pursuant hereto.
ARTICLE XIII
THE AGENT
13.1 Appointment. Bank One, NA (Main Office - Chicago) is hereby
appointed Agent hereunder, and each of the Banks irrevocably authorizes the
Agent to act as the contractual representative on behalf of such Bank. The Agent
agrees to act as such upon the express conditions contained in this Article
XIII. The Agent shall not have a fiduciary relationship in respect of any Bank
by reason of this Agreement.
13.2 Powers. The Agent shall have and may exercise such powers
hereunder as are specifically delegated to the Agent by the terms hereof,
together with such powers as are reasonably incidental thereto. The Agent shall
not have any implied duties to the Banks or any obligation to the Banks to take
any action hereunder except any action specifically provided by this Agreement
to be taken by the Agent.
13.3 General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Banks or any Bank for any
action taken or omitted to be taken by it or them hereunder or in connection
herewith except for its or their own gross negligence or willful misconduct.
13.4 No Responsibility for Loans, Recitals, Etc. The Agent shall
not be responsible to the Banks for any recitals, reports, statements,
warranties or representations herein or in any Credit Document or be bound to
ascertain or inquire as to the performance or observance of any of the terms of
this Agreement.
13.5 Action on Instructions of Banks. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder and under
any other Credit Document in accordance with written instructions signed by the
Majority Banks (or all of the Banks if required by Section 10.1), and such
instructions and any action taken or failure to act pursuant thereto shall be
binding on all of the Banks. The Banks hereby acknowledge that the Agent shall
be under no duty to take any discretionary action permitted to be taken by it
pursuant to the provisions of this Agreement or any other Credit Document unless
it shall be requested in writing to do so by the Majority Banks. The Agent shall
be fully justified in failing or refusing to take any action hereunder and under
any other Credit Document unless it shall first be indemnified to its
satisfaction by the Banks pro rata against any and all liability, cost and
expense that it may incur by reason of taking or continuing to take any such
action.
13.6 Employment of Agents and Counsel. The Agent may execute any of
its duties as Agent hereunder by or through employees, agents and
attorneys-in-fact and shall not be answerable to the Banks, except as to money
or securities received by it or its authorized agents,
-43-
for the default or misconduct of any such agents or attorneys-in-fact selected
by it with reasonable care. The Agent shall be entitled to advice of counsel
concerning all matters pertaining to the agency hereby created and its duties
hereunder.
13.7 Reliance on Documents; Counsel. The Agent shall be entitled to
rely upon any notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
13.8 Agent's Reimbursement and Indemnification. The Banks agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (i) for any amounts not reimbursed by the Company for which the
Agent is entitled to reimbursement by the Company under the Credit Documents,
(ii) for any other expenses reasonably incurred by the Agent on behalf of the
Banks, in connection with the preparation, execution, delivery, administration
and enforcement of the Credit Documents, and for which the Agent is not entitled
to reimbursement by the Company under the Credit Documents, and (iii) for any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against the Agent in any way relating to or
arising out of this Agreement or any other document delivered in connection with
this Agreement or the transactions contemplated hereby or the enforcement of any
of the terms hereof or of any such other documents, and for which the Agent is
not entitled to reimbursement by the Company under the Credit Documents,
provided that no Bank shall be liable for any of the foregoing to the extent
they arise from the gross negligence or willful misconduct of the Agent.
13.9 Rights as a Lender. With respect to its Commitment and any
Credit Extension made by it, the Agent shall have the same rights and powers
hereunder as any Bank and may exercise the same as though it were not the Agent,
and the term "Bank" or "Banks" shall, unless the context otherwise indicates,
include Bank One in its individual capacity. The Agent may accept deposits from,
lend money to, and generally engage in any kind of banking or trust business
with the Company or any Subsidiary as if it were not the Agent.
13.10 Bank Credit Decision. Each Bank acknowledges that it has,
independently and without reliance upon the Agent or any other Bank and based on
the financial statements prepared by the Company and such other documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. Each Bank also acknowledges that it will,
independently and without reliance upon the Agent or any other Bank and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
this Agreement.
13.11 Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Banks and the Company, and the Agent may be
removed at any time with or without cause by written notice received by the
Agent from the Majority Banks. Upon any such resignation or removal, the
Majority Banks shall have the right to appoint, on behalf of the Banks, a
successor Agent. If no successor Agent shall have been so appointed by the
Majority
-44-
Banks and shall have accepted such appointment within thirty days after the
retiring Agent's giving notice of resignation, then the retiring Agent may
appoint, on behalf of the Banks, a successor Agent. Such successor Agent shall
be a commercial bank having capital and retained earnings of at least
$500,000,000. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article XIII shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
the Agent hereunder.
13.12 Agent and Arranger Fees. The Company agrees to pay to the
Agent and Banc One Capital Markets, Inc. (the "Arranger"), for their respective
accounts, the fees agreed to by the Company, the Agent and the Arranger pursuant
to that certain letter agreement dated August 21, 2003, or as otherwise agreed
from time to time.
ARTICLE XIV
NOTICES
14.1 Giving Notice. Except as otherwise permitted by Section 2.8
with respect to borrowing notices, all notices, requests and other
communications to any party hereunder shall be in writing (including electronic
transmission, facsimile transmission or similar writing) and shall be given to
such party: (x) in the case of the Company, the Agent or the LC Issuer, at its
address or facsimile number set forth on the signature pages hereof, (y) in the
case of any Bank, at its address or facsimile number set forth in its
Administrative Questionnaire or (z) in the case of any party, at such other
address or facsimile number as such party may hereafter specify for the purpose
by notice to the Agent and the Company in accordance with the provisions of this
Section 14.1. Each such notice, request or other communication shall be
effective (i) if given by facsimile transmission, when transmitted to the
facsimile number specified in this Section and confirmation of receipt is
received, (ii) if given by mail, 72 hours after such communication is deposited
in the mails with first class postage prepaid, addressed as aforesaid, or (iii)
if given by any other means, when delivered (or, in the case of electronic
transmission, received) at the address specified in this Section; provided that
notices to the Agent under Article II shall not be effective until received.
14.2 Change of Address. The Company, the Agent and any Bank may
each change the address for service of notice upon it by a notice in writing to
the other parties hereto.
ARTICLE XV
TERMINATION OF PRIOR AGREEMENT
The Company and the Banks which are parties to the Prior Agreement
(which Banks constitute "Majority Banks" under Prior Agreement) agree that
notwithstanding any requirement for notice of termination of the Commitments
under Section 2.5(b) of the Prior Agreement), simultaneously with the initial
Credit Extension hereunder, the Prior Agreement shall terminate and be of no
further force or effect (except for any provision thereof which by its terms
survives
-45-
termination thereof); it being understood that concurrently with such
termination, each Existing Facility LC shall be deemed to be issued hereunder.
ARTICLE XVI
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Company, the
Agent, the LC Issuer and the Banks and each party has notified the Agent by
facsimile or telephone that it has taken such action.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the Company, the Banks, the LC Issuer and the Agent
have executed this Agreement as of the date first above written.
CONSUMERS ENERGY COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
ADDRESS:
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation (Phone) No: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
BANK ONE, NA (MAIN OFFICE -
CHICAGO), Individually and as Agent and
as LC Issuer
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Director
ADDRESS:
Bank One Plaza
Mail Code IL 1-0367
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation (Phone) No: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇_▇▇▇@▇▇▇▇▇▇▇.▇▇▇
BARCLAYS BANK PLC, Individually and as
Syndication Agent
By: /s/ Sydney ▇. ▇▇▇▇▇▇
--------------------------------------
Name: Sydney ▇. ▇▇▇▇▇▇
Title: Director
ADDRESS:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Sydney ▇. ▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Confirmation (Phone) No: (▇▇▇) ▇▇▇-▇▇▇▇
E-Mail Address: ▇▇▇▇▇▇.▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
CITICORP NORTH AMERICA, INC.,
Individually and as Co-Documentation Agent
By: /s/ J. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: J. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Managing Director
JPMORGAN CHASE BANK, Individually and
as Co-Documentation Agent
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
--------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇
Vice President
UNION BANK OF CALIFORNIA, N.A.,
Individually and as Co-Documentation Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
WACHOVIA BANK, NATIONAL ASSOCIATION
By: /s/ D. ▇▇▇▇▇ ▇▇▇▇▇▇
--------------------------------------
Name: D. ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
DEUTSCHE BANK TRUST COMPANY AMERICAS
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Director
BNP PARIBAS
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
STANDARD FEDERAL BANK N.A.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, III
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, III
Title: First Vice President
HUNTINGTON NATIONAL BANK
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
HSH NORDBANK AG,
NEW YORK BRANCH
By: /s/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
Title: Senior Vice President
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
COMERICA BANK
By: /s/ ▇▇▇▇▇ ▇ ▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇ ▇ ▇▇▇▇
Title: Vice President
THE FIFTH THIRD BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
Vice President and Group Manager
EXHIBIT A
[FORM OF SUPPLEMENTAL INDENTURE]
NINETY-THIRD SUPPLEMENTAL INDENTURE
PROVIDING AMONG OTHER THINGS FOR
FIRST MORTGAGE BONDS,
2003-1 COLLATERAL SERIES (INTEREST BEARING)
--------------
DATED AS OF SEPTEMBER __, 2003
--------------
CONSUMERS ENERGY COMPANY
TO
JPMORGAN CHASE BANK,
TRUSTEE
Counterpart ____ of 80
THIS NINETY-THIRD SUPPLEMENTAL INDENTURE, dated as of September __,
2003 (herein sometimes referred to as "this Supplemental Indenture"), made and
entered into by and between CONSUMERS ENERGY COMPANY, a corporation organized
and existing under the laws of the State of Michigan, with its principal
executive office and place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, formerly known as Consumers Power Company (hereinafter
sometimes referred to as the "Company"), and JPMORGAN CHASE BANK, a corporation
organized and existing under the laws of the State of New York, with its
corporate trust offices at 4 New York Plaza, in the Borough of Manhattan, The
City of ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (hereinafter sometimes referred to as the
"Trustee"), as Trustee under the Indenture dated as of September 1, 1945 between
Consumers Power Company, a Maine corporation (hereinafter sometimes referred to
as the "Maine corporation"), and City Bank Farmers Trust Company (Citibank,
N.A., successor, hereinafter sometimes referred to as the "Predecessor
Trustee"), securing bonds issued and to be issued as provided therein
(hereinafter sometimes referred to as the "Indenture"),
WHEREAS at the close of business on January 30, 1959, City Bank Farmers
Trust Company was converted into a national banking association under the title
"First National City Trust Company"; and
WHEREAS at the close of business on January 15, 1963, First National
City Trust Company was merged into First National City Bank; and
WHEREAS at the close of business on October 31, 1968, First National
City Bank was merged into The City Bank of New York, National Association, the
name of which was thereupon changed to First National City Bank; and
WHEREAS effective March 1, 1976, the name of First National City Bank
was changed to Citibank, N.A.; and
WHEREAS effective July 16, 1984, Manufacturers Hanover Trust Company
succeeded Citibank, N.A. as Trustee under the Indenture; and
WHEREAS effective June 19, 1992, Chemical Bank succeeded by merger to
Manufacturers Hanover Trust Company as Trustee under the Indenture; and
WHEREAS effective July 15, 1996, The Chase Manhattan Bank (National
Association), merged with and into Chemical Bank which thereafter was renamed
The Chase Manhattan Bank; and
WHEREAS effective November 11, ▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank merged
with ▇▇▇▇▇▇ Guaranty Trust Company of New York and the surviving corporation was
renamed JPMorgan Chase Bank; and
WHEREAS the Indenture was executed and delivered for the purpose of
securing such bonds as may from time to time be issued under and in accordance
with the terms of the Indenture, the aggregate principal amount of bonds to be
secured thereby being limited to $5,000,000,000 at any one time outstanding
(except as provided in Section 2.01 of the
Indenture), and the Indenture describes and sets forth the property conveyed
thereby and is filed in the Office of the Secretary of State of the State of
Michigan and is of record in the Office of the Register of Deeds of each county
in the State of Michigan in which this Supplemental Indenture is to be recorded;
and
WHEREAS the Indenture has been supplemented and amended by various
indentures supplemental thereto, each of which is filed in the Office of the
Secretary of State of the State of Michigan and is of record in the Office of
the Register of Deeds of each county in the State of Michigan in which this
Supplemental Indenture is to be recorded; and
WHEREAS the Company and the Maine corporation entered into an Agreement
of Merger and Consolidation, dated as of February 14, 1968, which provided for
the Maine corporation to merge into the Company; and
WHEREAS the effective date of such Agreement of Merger and
Consolidation was June 6, 1968, upon which date the Maine corporation was merged
into the Company and the name of the Company was changed from "Consumers Power
Company of Michigan" to "Consumers Power Company"; and
WHEREAS the Company and the Predecessor Trustee entered into a
Sixteenth Supplemental Indenture, dated as of June 4, 1968, which provided,
among other things, for the assumption of the Indenture by the Company; and
WHEREAS said Sixteenth Supplemental Indenture became effective on the
effective date of such Agreement of Merger and Consolidation; and
WHEREAS the Company has succeeded to and has been substituted for the
Maine corporation under the Indenture with the same effect as if it had been
named therein as the mortgagor corporation; and
WHEREAS effective March 11, 1997, the name of Consumers Power Company
was changed to Consumers Energy Company; and
WHEREAS, the Company has entered into an Amended and Restated Credit
Agreement dated as of September __, 2003 (as amended or otherwise modified from
time to time, the "Credit Agreement") with various financial institutions and
Bank One, NA, as administrative agent (in such capacity, the "Agent") for the
Banks (as such term is defined in the Credit Agreement), providing for the
making of certain financial accommodations thereunder, and pursuant to such
Credit Agreement the Company has agreed to issue to the Agent, as evidence of
and security for the Obligations (as such term is defined in the Credit
Agreement), a new series of bonds under the Indenture; and
WHEREAS, for such purposes the Company desires to issue a new series of
bonds, to be designated First Mortgage Bonds, 2003-1 Collateral Series (Interest
Bearing), each of which bonds shall also bear the descriptive title "First
Mortgage Bond" (hereinafter provided for and hereinafter sometimes referred to
as the "2003-1 Collateral Bonds"), the bonds of which series are to be issued as
registered bonds without coupons and are to bear interest at the rate per
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annum specified herein and are to mature on the Termination Date (as such term
is defined in the Credit Agreement); and
WHEREAS, each of the registered bonds without coupons of the 2003-1
Collateral Bonds and the Trustee's Authentication Certificate thereon are to be
substantially in the following form, to wit:
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[FORM OF REGISTERED BOND
OF THE 2003-1 COLLATERAL BONDS]
[FACE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND
2003-1 COLLATERAL SERIES (INTEREST BEARING)
No. 1 $400,000,000
CONSUMERS ENERGY COMPANY, a Michigan corporation (hereinafter called
the "Company"), for value received, hereby promises to pay to Bank One, NA, as
agent (in such capacity, the "Agent") for the Banks under and as defined in the
Credit Agreement dated as of September __, 2003 among the Company, the Banks and
the Agent (as amended or otherwise modified from time to time, the "Credit
Agreement"), or registered assigns, the principal sum of Four Hundred Million
Dollars ($400,000,000) or such lesser principal amount as shall be equal to the
aggregate principal amount of the Loans (as defined in the Credit Agreement) and
Reimbursement Obligations (as defined in the Credit Agreement) included in the
Obligations (as defined in the Credit Agreement) outstanding on the Termination
Date (as defined in the Credit Agreement) (the "Maturity Date"), but not in
excess, however, of the principal amount of this bond, and to pay interest
thereon at the Interest Rate (as defined below) until the principal hereof is
paid or duly made available for payment on the Maturity Date, or, in the event
of redemption of this bond, until the redemption date, or, in the event of
default in the payment of the principal hereof, until the Company's obligations
with respect to the payment of such principal shall be discharged as provided in
the Indenture (as defined on the reverse hereof). Interest on this bond shall be
payable on each Interest Payment Date (as defined below), commencing on the
first Interest Payment Date next succeeding September __, 2003. If the Maturity
Date falls on a day which is not a Business Day, as defined below, principal and
any interest and/or fees payable with respect to the Maturity Date will be paid
on the immediately preceding Business Day. The interest payable, and punctually
paid or duly provided for, on any Interest Payment Date will, subject to certain
exceptions, be paid to the person in whose name this bond (or one or more
predecessor bonds) is registered at the close of business on the Record Date (as
defined below); provided, however, that interest payable on the Maturity Date
will be payable to the person to whom the principal hereof shall be payable.
Should the Company default in the payment of interest ("Defaulted Interest"),
the Defaulted Interest shall be paid to the person in whose name this bond (or
one or more predecessor bonds) is registered on a subsequent record date fixed
by the Company, which subsequent record date shall be fifteen (15) days prior to
the payment of such Defaulted Interest. As used herein, (A) "Business Day" shall
mean any day, other than a Saturday or Sunday, on which banks generally are open
in Chicago, Illinois and New York, New York for the conduct of substantially all
of their commercial lending activities and on which interbank wire transfers can
be made on the Fedwire system; (B) "Interest Payment Date" shall
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mean each date on which Obligations constituting interest and/or fees are due
and payable from time to time pursuant to the Credit Agreement; (C) "Interest
Rate" shall mean a rate of interest per annum, adjusted as necessary, to result
in an interest payment equal to the aggregate amount of Obligations constituting
interest and fees due under the Credit Agreement on the applicable Interest
Payment Date; and (D) "Record Date" with respect to any Interest Payment Date
shall mean the day (whether or not a Business Day) immediately next preceding
such Interest Payment Date.
Payment of the principal of and interest on this bond will be made in
immediately available funds at the office or agency of the Company maintained
for that purpose in the City of Jackson, Michigan, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.
The provisions of this bond are continued on the reverse hereof and
such continued provisions shall for all purposes have the same effect as though
fully set forth at this place.
This bond shall not be valid or become obligatory for any purpose
unless and until it shall have been authenticated by the execution by the
Trustee or its successor in trust under the Indenture of the certificate hereon.
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IN WITNESS WHEREOF, Consumers Energy Company has caused this
bond to be executed in its name by its Chairman of the Board, its President or
one of its Vice Presidents by his or her signature or a facsimile thereof, and
its corporate seal or a facsimile thereof to be affixed hereto or imprinted
hereon and attested by its Secretary or one of its Assistant Secretaries by his
or her signature or a facsimile thereof.
CONSUMERS ENERGY COMPANY
Dated:
By __________________________________
Printed _____________________________
Title _______________________________
Attest: _________________________
TRUSTEE'S AUTHENTICATION CERTIFICATE
This is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.
JPMORGAN CHASE BANK, Trustee
By____________________________________
Authorized Officer
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[REVERSE]
CONSUMERS ENERGY COMPANY
FIRST MORTGAGE BOND
2003-1 COLLATERAL SERIES (INTEREST BEARING)
This bond is one of the bonds of a series designated as First Mortgage
Bonds, 2003-1 Collateral Series (Interest Bearing) (sometimes herein referred to
as the "2003-1 Collateral Bonds") issued under and in accordance with and
secured by an Indenture dated as of September 1, 1945, given by the Company (or
its predecessor, Consumers Power Company, a Maine corporation) to City Bank
Farmers Trust Company (JPMorgan Chase Bank, successor) (hereinafter sometimes
referred to as the "Trustee"), together with indentures supplemental thereto,
heretofore or hereafter executed, to which indenture and indentures supplemental
thereto (hereinafter referred to collectively as the "Indenture") reference is
hereby made for a description of the property mortgaged and pledged, the nature
and extent of the security and the rights, duties and immunities thereunder of
the Trustee and the rights of the holders of said bonds and of the Trustee and
of the Company in respect of such security, and the limitations on such rights.
By the terms of the Indenture, the bonds to be secured thereby are issuable in
series which may vary as to date, amount, date of maturity, rate of interest and
in other respects as provided in the Indenture.
The 2003-1 Collateral Bonds are to be issued and delivered to the Agent
in order to evidence and secure the obligation of the Company under the Credit
Agreement to make payments to the Banks under the Credit Agreement and to
provide the Banks the benefit of the lien of the Indenture with respect to the
2003-1 Collateral Bonds.
The obligation of the Company to make payments with respect to the
principal of 2003-1 Collateral Bonds shall be fully or partially, as the case
may be, satisfied and discharged to the extent that, at the time that any such
payment shall be due, the then due principal of the Loans and/or the
Reimbursement Obligations included in the Obligations shall have been fully or
partially paid. Satisfaction of any obligation to the extent that payment is
made with respect to the Loans and/or the Reimbursement Obligations means that
if any payment is made on the principal of the Loans and/or the Reimbursement
Obligations, a corresponding payment obligation with respect to the principal of
the 2003-1 Collateral Bonds shall be deemed discharged in the same amount as the
payment with respect to the Loans and/or the Reimbursement Obligations
discharges the outstanding obligation with respect to such Loans and/or
Reimbursement Obligations. No such payment of principal shall reduce the
principal amount of the 2003-1 Collateral Bonds.
The obligation of the Company to make payments with respect to the
interest on 2003-1 Collateral Bonds shall be fully or partially, as the case may
be, satisfied and discharged to the extent that, at the time that any such
payment shall be due, the then due interest and/or fees under the Credit
Agreement shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the interest
and/or fees under the Credit Agreement means that if any payment is made on the
interest and/or fees under the Credit Agreement, a
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corresponding payment obligation with respect to the interest on the 2003-1
Collateral Bonds shall be deemed discharged in the same amount as the payment
with respect to the Loans and/or the Reimbursement Obligations discharges the
outstanding obligation with respect to such Loans and/or Reimbursement
Obligations.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on this bond, so far as such payments at the time have become due, has
been fully satisfied and discharged unless and until the Trustee shall have
received a written notice from the Agent stating (i) that timely payment of
principal and interest on the 2003-1 Collateral Bonds has not been made, (ii)
that the Company is in arrears as to the payments required to be made by it to
the Agent in connection with the Obligations pursuant to the Credit Agreement,
and (iii) the amount of the arrearage.
If an Event of Default (as defined in the Credit Agreement) with
respect to the payment of the principal of the Loans and/or the Reimbursement
Obligations shall have occurred, it shall be deemed to be a default for purposes
of Section 11.01 of the Indenture in the payment of the principal of the 2003-1
Collateral Bonds equal to the amount of such unpaid principal or Reimbursement
Obligations (but in no event in excess of the principal amount of the 2003-1
Collateral Bonds). If an Event of Default (as defined in the Credit Agreement)
with respect to the payment of interest on the Loans and/or the Reimbursement
Obligations or any fees shall have occurred, it shall be deemed to be a default
for purposes of Section 11.01 of the Indenture in the payment of the interest on
the 2003-1 Collateral Bonds equal to the amount of such unpaid interest or fees.
This bond is not redeemable except upon written demand of the Agent
following the occurrence of an Event of Default under the Credit Agreement and
the acceleration of the Obligations, as provided in Section 9.2 of the Credit
Agreement. This bond is not redeemable by the operation of the improvement fund
or the maintenance and replacement provisions of the Indenture or with the
proceeds of released property.
In case of certain defaults as specified in the Indenture, the
principal of this bond may be declared or may become due and payable on the
conditions, at the time, in the manner and with the effect provided in the
Indenture. The holders of certain specified percentages of the bonds at the time
outstanding, including in certain cases specified percentages of bonds of
particular series, may in certain cases, to the extent and as provided in the
Indenture, waive certain defaults thereunder and the consequences of such
defaults.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than seventy-five per
centum in principal amount of the bonds (exclusive of bonds disqualified by
reason of the Company's interest therein) at the time outstanding, including, if
more than one series of bonds shall be at the time outstanding, not less than
sixty per centum in principal amount of each series affected, to effect, by an
indenture supplemental to the Indenture, modifications or alterations of the
Indenture and of the rights and obligations of the Company and the rights of the
holders of the bonds and coupons; provided, however, that no such modification
or alteration shall be made without the written approval or consent of the
holder hereof which will (a) extend the maturity of this bond or reduce the rate
or
A-8
extend the time of payment of interest hereon or reduce the amount of the
principal hereof, or (b) permit the creation of any lien, not otherwise
permitted, prior to or on a parity with the lien of the Indenture, or (c) reduce
the percentage of the principal amount of the bonds the holders of which are
required to approve any such supplemental indenture.
The Company reserves the right, without any consent, vote or other
action by holders of the 2003-1 Collateral Bonds or any other series created
after the Sixty-eighth Supplemental Indenture, to amend the Indenture to reduce
the percentage of the principal amount of bonds the holders of which are
required to approve any supplemental indenture (other than any supplemental
indenture which is subject to the proviso contained in the immediately preceding
sentence) (a) from not less than seventy-five per centum (including sixty per
centum of each series affected) to not less than a majority in principal amount
of the bonds at the time outstanding or (b) in case fewer than all series are
affected, not less than a majority in principal amount of the bonds of all
affected series, voting together.
No recourse shall be had for the payment of the principal of or
interest on this bond, or for any claim based hereon, or otherwise in respect
hereof or of the Indenture, to or against any incorporator, stockholder,
director or officer, past, present or future, as such, of the Company, or of any
predecessor or successor company, either directly or through the Company, or
such predecessor or successor company, or otherwise, under any constitution or
statute or rule of law, or by the enforcement of any assessment or penalty, or
otherwise, all such liability of incorporators, stockholders, directors and
officers, as such, being waived and released by the holder and owner hereof by
the acceptance of this bond and being likewise waived and released by the terms
of the Indenture.
This bond shall be exchangeable for other registered bonds of the same
series, in the manner and upon the conditions prescribed in the Indenture, upon
the surrender of such bonds at the Investor Services Department of the Company,
as transfer agent. However, notwithstanding the provisions of Section 2.05 of
the Indenture, no charge shall be made upon any registration of transfer or
exchange of bonds of said series other than for any tax or taxes or other
governmental charge required to be paid by the Company.
The Agent shall surrender this bond to the Trustee when all of the
principal of and interest on the Loans and Reimbursement Obligations arising
under the Credit Agreement, and all of the fees payable pursuant to the Credit
Agreement with respect to the Obligations shall have been duly paid, and the
Credit Agreement shall have been terminated.
[END OF FORM OF REGISTERED BOND
OF THE 2003-1 COLLATERAL BONDS]
- - - - - - - - - - - - - - -
A-9
AND WHEREAS all acts and things necessary to make the 2003-1 Collateral
Bonds (the "Collateral Bonds"), when duly executed by the Company and
authenticated by the Trustee or its agent and issued as prescribed in the
Indenture, as heretofore supplemented and amended, and this Supplemental
Indenture provided, the valid, binding and legal obligations of the Company, and
to constitute the Indenture, as supplemented and amended as aforesaid, as well
as by this Supplemental Indenture, a valid, binding and legal instrument for the
security thereof, have been done and performed, and the creation, execution and
delivery of this Supplemental Indenture and the creation, execution and issuance
of bonds subject to the terms hereof and of the Indenture, as so supplemented
and amended, have in all respects been duly authorized;
NOW, THEREFORE, in consideration of the premises, of the acceptance and
purchase by the holders thereof of the bonds issued and to be issued under the
Indenture, as supplemented and amended as above set forth, and of the sum of One
Dollar duly paid by the Trustee to the Company, and of other good and valuable
considerations, the receipt whereof is hereby acknowledged, and for the purpose
of securing the due and punctual payment of the principal of and premium, if
any, and interest on all bonds now outstanding under the Indenture and the
$400,000,000 principal amount of the Collateral Bonds and all other bonds which
shall be issued under the Indenture, as supplemented and amended from time to
time, and for the purpose of securing the faithful performance and observance of
all covenants and conditions therein, and in any indenture supplemental thereto,
set forth, the Company has given, granted, bargained, sold, released,
transferred, assigned, hypothecated, pledged, mortgaged, confirmed, set over,
warranted, alienated and conveyed and by these presents does give, grant,
bargain, sell, release, transfer, assign, hypothecate, pledge, mortgage,
confirm, set over, warrant, alien and convey unto JPMorgan Chase Bank, as
Trustee, as provided in the Indenture, and its successor or successors in the
trust thereby and hereby created and to its or their assigns forever, all the
right, title and interest of the Company in and to all the property, described
in Section 11 hereof, together (subject to the provisions of Article X of the
Indenture) with the tolls, rents, revenues, issues, earnings, income, products
and profits thereof, excepting, however, the property, interests and rights
specifically excepted from the lien of the Indenture as set forth in the
Indenture.
TOGETHER WITH all and singular the tenements, hereditaments and
appurtenances belonging or in any wise appertaining to the premises, property,
franchises and rights, or any thereof, referred to in the foregoing granting
clause, with the reversion and reversions, remainder and remainders and (subject
to the provisions of Article X of the Indenture) the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, and all the estate,
right, title and interest and claim whatsoever, at law as well as in equity,
which the Company now has or may hereafter acquire in and to the aforesaid
premises, property, franchises and rights and every part and parcel thereof.
SUBJECT, HOWEVER, with respect to such premises, property, franchises
and rights, to excepted encumbrances as said term is defined in Section 1.02 of
the Indenture, and subject also to all defects and limitations of title and to
all encumbrances existing at the time of acquisition. TO HAVE AND TO HOLD all
said premises, property, franchises and rights hereby conveyed, assigned,
pledged or mortgaged, or intended so to be, unto the Trustee, its successor or
successors in trust and their assigns forever;
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BUT IN TRUST, NEVERTHELESS, with power of sale for the equal and
proportionate benefit and security of the holders of all bonds now or hereafter
authenticated and delivered under and secured by the Indenture and interest
coupons appurtenant thereto, pursuant to the provisions of the Indenture and of
any supplemental indenture, and for the enforcement of the payment of said bonds
and coupons when payable and the performance of and compliance with the
covenants and conditions of the Indenture and of any supplemental indenture,
without any preference, distinction or priority as to lien or otherwise of any
bond or bonds over others by reason of the difference in time of the actual
authentication, delivery, issue, sale or negotiation thereof or for any other
reason whatsoever, except as otherwise expressly provided in the Indenture; and
so that each and every bond now or hereafter authenticated and delivered
thereunder shall have the same lien, and so that the principal of and premium,
if any, and interest on every such bond shall, subject to the terms thereof, be
equally and proportionately secured, as if it had been made, executed,
authenticated, delivered, sold and negotiated simultaneously with the execution
and delivery thereof.
AND IT IS EXPRESSLY DECLARED by the Company that all bonds
authenticated and delivered under and secured by the Indenture, as supplemented
and amended as above set forth, are to be issued, authenticated and delivered,
and all said premises, property, franchises and rights hereby and by the
Indenture and indentures supplemental thereto conveyed, assigned, pledged or
mortgaged, or intended so to be, are to be dealt with and disposed of under,
upon and subject to the terms, conditions, stipulations, covenants, agreements,
trusts, uses and purposes expressed in the Indenture, as supplemented and
amended as above set forth, and the parties hereto mutually agree as follows:
SECTION 1. There is hereby created a series of bonds (the "2003-1
Collateral Bonds") designated as hereinabove provided, which shall also bear the
descriptive title "First Mortgage Bond", and the forms thereof shall be
substantially as hereinbefore set forth (collectively, the "Sample Bond"). The
2003-1 Collateral Bonds shall be issued in the aggregate principal amount of
$400,000,000, shall mature on the Termination Date (as such term is defined in
the Credit Agreement) and shall be issued only as registered bonds without
coupons in denominations of $1,000 and any multiple thereof. The serial numbers
of the Collateral Bonds shall be such as may be approved by any officer of the
Company, the execution thereof by any such officer either manually or by
facsimile signature to be conclusive evidence of such approval. The Collateral
Bonds are to be issued to and registered in the name of the Agent under the
Credit Agreement (as such terms are defined in the Sample Bonds) to evidence and
secure any and all Obligations (as such term is defined in the Credit Agreement)
of the Company under the Credit Agreement.
The 2003-1 Collateral Bonds shall bear interest as set forth in the
Sample Bond. The principal of and the interest on said bonds shall be payable as
set forth in the Sample Bond.
The obligation of the Company to make payments with respect to the
principal of 2003-1 Collateral Bonds shall be fully or partially, as the case
may be, satisfied and discharged to the extent that, at the time that any such
payment shall be due, the then due principal of the Loans and/or the
Reimbursement Obligations included in the Obligations shall have been fully or
partially paid. Satisfaction of any obligation to the extent that payment is
made with respect to the Loans and/or the Reimbursement Obligations means that
if any payment is made on the
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principal of the Loans and/or the Reimbursement Obligations, a corresponding
payment obligation with respect to the principal of the 2003-1 Collateral Bonds
shall be deemed discharged in the same amount as the payment with respect to the
Loans and/or the Reimbursement Obligations discharges the outstanding obligation
with respect to such Loans and/or Reimbursement Obligations. No such payment of
principal shall reduce the principal amount of the 2003-1 Collateral Bonds.
The obligation of the Company to make payments with respect to the
interest on 2003-1 Collateral Bonds shall be fully or partially, as the case may
be, satisfied and discharged to the extent that, at the time that any such
payment shall be due, the then due interest and/or fees under the Credit
Agreement shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the interest
and/or fees under the Credit Agreement means that if any payment is made on the
interest and/or fees under the Credit Agreement, a corresponding payment
obligation with respect to the interest on the 2003-1 Collateral Bonds shall be
deemed discharged in the same amount as the payment with respect to the interest
and/or fees discharges the outstanding obligation with respect to such interest
and/or fees.
The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on the Collateral Bonds, so far as such payments at the time have
become due, has been fully satisfied and discharged unless and until the Trustee
shall have received a written notice from the Agent stating (i) that timely
payment of principal and interest on the 2003-1 Collateral Bonds has not been
made, (ii) that the Company is in arrears as to the payments required to be made
by it to the Agent pursuant to the Credit Agreement, and (iii) the amount of the
arrearage.
The Collateral Bonds shall be exchangeable for other registered bonds
of the same series, in the manner and upon the conditions prescribed in the
Indenture, upon the surrender of such bonds at the Investor Services Department
of the Company, as transfer agent. However, notwithstanding the provisions of
Section 2.05 of the Indenture, no charge shall be made upon any registration of
transfer or exchange of bonds of said series other than for any tax or taxes or
other governmental charge required to be paid by the Company.
SECTION 2. The Collateral Bonds are not redeemable by the operation of
the maintenance and replacement provisions of this Indenture or with the
proceeds of released property.
SECTION 3. Upon the occurrence of an Event of Default under the Credit
Agreement and the acceleration of the Obligations, the Collateral Bonds shall be
redeemable in whole upon receipt by the Trustee of a written demand from the
Agent stating that there has occurred under the Credit Agreement both an Event
of Default and a declaration of acceleration of the Obligations and demanding
redemption of the Collateral Bonds (including a description of the amount of
principal, interest and fees which comprise such Obligations). The Company
waives any right it may have to prior notice of such redemption under the
Indenture. Upon surrender of the Collateral Bonds by the Agent to the Trustee,
the Collateral Bonds shall be redeemed at a redemption price equal to the
aggregate amount of the Obligations.
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SECTION 4. The Company reserves the right, without any consent, vote or
other action by the holder of the Collateral Bonds or of any subsequent series
of bonds issued under the Indenture, to make such amendments to the Indenture,
as supplemented, as shall be necessary in order to amend Section 17.02 to read
as follows:
SECTION 17.02. With the consent of the holders of not less
than a majority in principal amount of the bonds at the time
outstanding or their attorneys-in-fact duly authorized, or, if fewer
than all series are affected, not less than a majority in principal
amount of the bonds at the time outstanding of each series the rights
of the holders of which are affected, voting together, the Company,
when authorized by a resolution, and the Trustee may from time to time
and at any time enter into an indenture or indentures supplemental
hereto for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Indenture or of any
supplemental indenture or modifying the rights and obligations of the
Company and the rights of the holders of any of the bonds and coupons;
provided, however, that no such supplemental indenture shall (1) extend
the maturity of any of the bonds or reduce the rate or extend the time
of payment of interest thereon, or reduce the amount of the principal
thereof, or reduce any premium payable on the redemption thereof,
without the consent of the holder of each bond so affected, or (2)
permit the creation of any lien, not otherwise permitted, prior to or
on a parity with the lien of this Indenture, without the consent of the
holders of all the bonds then outstanding, or (3) reduce the aforesaid
percentage of the principal amount of bonds the holders of which are
required to approve any such supplemental indenture, without the
consent of the holders of all the bonds then outstanding. For the
purposes of this Section, bonds shall be deemed to be affected by a
supplemental indenture if such supplemental indenture adversely affects
or diminishes the rights of holders thereof against the Company or
against its property. The Trustee may in its discretion determine
whether or not, in accordance with the foregoing, bonds of any
particular series would be affected by any supplemental indenture and
any such determination shall be conclusive upon the holders of bonds of
such series and all other series. Subject to the provisions of Sections
16.02 and 16.03 hereof, the Trustee shall not be liable for any
determination made in good faith in connection herewith.
Upon the written request of the Company, accompanied by a
resolution authorizing the execution of any such supplemental
indenture, and upon the filing with the Trustee of evidence of the
consent of bondholders as aforesaid (the instrument or instruments
evidencing such consent to be dated within one year of such request),
the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the
Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee
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may in its discretion but shall not be obligated to enter into such
supplemental indenture.
It shall not be necessary for the consent of the bondholders
under this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such consent
shall approve the substance thereof.
The Company and the Trustee, if they so elect, and either
before or after such consent has been obtained, may require the holder
of any bond consenting to the execution of any such supplemental
indenture to submit his bond to the Trustee or to ask such bank, banker
or trust company as may be designated by the Trustee for the purpose,
for the notation thereon of the fact that the holder of such bond has
consented to the execution of such supplemental indenture, and in such
case such notation, in form satisfactory to the Trustee, shall be made
upon all bonds so submitted, and such bonds bearing such notation shall
forthwith be returned to the persons entitled thereto.
Prior to the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the
Company shall publish a notice, setting forth in general terms the
substance of such supplemental indenture, at least once in one daily
newspaper of general circulation in each city in which the principal of
any of the bonds shall be payable, or, if all bonds outstanding shall
be registered bonds without coupons or coupon bonds registered as to
principal, such notice shall be sufficiently given if mailed, first
class, postage prepaid, and registered if the Company so elects, to
each registered holder of bonds at the last address of such holder
appearing on the registry books, such publication or mailing, as the
case may be, to be made not less than thirty days prior to such
execution. Any failure of the Company to give such notice, or any
defect therein, shall not, however, in any way impair or affect the
validity of any such supplemental indenture.
SECTION 5. As supplemented and amended as above set forth, the
Indenture is in all respects ratified and confirmed, and the Indenture and all
indentures supplemental thereto shall be read, taken and construed as one and
the same instrument.
SECTION 6. Nothing contained in this Supplemental Indenture shall, or
shall be construed to, confer upon any person other than a holder of bonds
issued under the Indenture, as supplemented and amended as above set forth, the
Company, the Trustee and the Agent, for the benefit of the Banks (as such term
is defined in the Credit Agreement), any right or interest to avail himself of
any benefit under any provision of the Indenture, as so supplemented and
amended.
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SECTION 7. The Trustee assumes no responsibility for or in respect of
the validity or sufficiency of this Supplemental Indenture or of the Indenture
as hereby supplemented or the due execution hereof by the Company or for or in
respect of the recitals and statements contained herein (other than those
contained in the sixth, seventh and eighth recitals hereof), all of which
recitals and statements are made solely by the Company.
SECTION 8. This Supplemental Indenture may be simultaneously executed
in several counterparts and all such counterparts executed and delivered, each
as an original, shall constitute but one and the same instrument.
SECTION 9. In the event the date of any notice required or permitted
hereunder shall not be a Business Day, then (notwithstanding any other provision
of the Indenture or of any supplemental indenture thereto) such notice need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the date fixed for such notice.
"Business Day" means, with respect to this Section 9, any day, other than a
Saturday or Sunday, on which banks generally are open in Chicago, Illinois and
New York, New York for the conduct of substantially all of their commercial
lending activities and on which interbank wire transfers can be made on the
Fedwire system.
SECTION 10. This Supplemental Indenture and the Collateral Bonds shall
be governed by and deemed to be a contract under, and construed in accordance
with, the laws of the State of Michigan, and for all purposes shall be construed
in accordance with the laws of such state, except as may otherwise be required
by mandatory provisions of law.
SECTION 11. Detailed Description of Property Mortgaged:
I.
ELECTRIC GENERATING PLANTS AND DAMS
All the electric generating plants and stations of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, including all powerhouses, buildings, reservoirs, dams,
pipelines, flumes, structures and works and the land on which the same are
situated and all water rights and all other lands and easements, rights of way,
permits, privileges, towers, poles, wires, machinery, equipment, appliances,
appurtenances and supplies and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with such
plants and stations or any of them, or adjacent thereto.
II.
ELECTRIC TRANSMISSION LINES
All the electric transmission lines of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including towers, poles, pole lines, wires, switches, switch racks,
switchboards, insulators and other appliances and equipment, and all other
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property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such transmission lines or any of them or
adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises and rights for or relating to the construction,
maintenance or operation thereof, through, over, under or upon any private
property or any public streets or highways, within as well as without the
corporate limits of any municipal corporation. Also all the real property,
rights of way, easements, permits, privileges and rights for or relating to the
construction, maintenance or operation of certain transmission lines, the land
and rights for which are owned by the Company, which are either not built or now
being constructed.
III.
ELECTRIC DISTRIBUTION SYSTEMS
All the electric distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including substations, transformers, switchboards, towers, poles, wires,
insulators, subways, trenches, conduits, manholes, cables, meters and other
appliances and equipment, and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with such
distribution systems or any of them or adjacent thereto; together with all real
property, rights of way, easements, permits, privileges, franchises, grants and
rights, for or relating to the construction, maintenance or operation thereof,
through, over, under or upon any private property or any public streets or
highways within as well as without the corporate limits of any municipal
corporation.
IV.
ELECTRIC SUBSTATIONS, SWITCHING STATIONS AND SITES
All the substations, switching stations and sites of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, for transforming, regulating, converting or distributing or
otherwise controlling electric current at any of its plants and elsewhere,
together with all buildings, transformers, wires, insulators and other
appliances and equipment, and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with any
of such substations and switching stations, or adjacent thereto, with sites to
be used for such purposes.
V.
GAS COMPRESSOR STATIONS, GAS PROCESSING PLANTS, DESULPHURIZATION
STATIONS, METERING STATIONS, ODORIZING STATIONS, REGULATORS AND SITES
All the compressor stations, processing plants, desulphurization
stations, metering stations, odorizing stations, regulators and sites of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not
A-16
heretofore released from the lien of the Indenture, for compressing, processing,
desulphurizing, metering, odorizing and regulating manufactured or natural gas
at any of its plants and elsewhere, together with all buildings, meters and
other appliances and equipment, and all other property, real or personal,
forming a part of or appertaining to or used, occupied or enjoyed in connection
with any of such purposes, with sites to be used for such purposes.
VI.
GAS STORAGE FIELDS
The natural gas rights and interests of the Company, including ▇▇▇▇▇
and well lines (but not including natural gas, oil and minerals), the gas
gathering system, the underground gas storage rights, the underground gas
storage ▇▇▇▇▇ and injection and withdrawal system used in connection therewith,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture: In the Overisel Gas Storage Field, located in the Township of
Overisel, Allegan County, and in the Township of Zeeland, Ottawa County,
Michigan; in the Northville Gas Storage Field located in the Township of Salem,
Washtenaw County, Township of Lyon, Oakland County, and the Townships of
Northville and Plymouth and City of Plymouth, ▇▇▇▇▇ County, Michigan; in the
Salem Gas Storage Field, located in the Township of Salem, Allegan County, and
in the Township of Jamestown, Ottawa County, Michigan; in the Ray Gas Storage
Field, located in the Townships of Ray and Armada, Macomb County, Michigan; in
the Lenox Gas Storage Field, located in the Townships of Lenox and Chesterfield,
Macomb County, Michigan; in the ▇▇▇ Gas Storage Field, located in the Township
of ▇▇▇, St. Clair County, Michigan; in the Puttygut Gas Storage Field, located
in the Township of Casco, St. Clair County, Michigan; in the Four Corners Gas
Storage Field, located in the Townships of Casco, China, Cottrellville and ▇▇▇,
St. Clair County, Michigan; in the Swan Creek Gas Storage Field, located in the
Township of Casco and ▇▇▇, St. Clair County, Michigan; and in the Hessen Gas
Storage Field, located in the Townships of Casco and Columbus, St. Clair,
Michigan.
VII.
GAS TRANSMISSION LINES
All the gas transmission lines of the Company, constructed or otherwise
acquired by it and not heretofore described in the Indenture or any supplement
thereto and not heretofore released from the lien of the Indenture, including
gas mains, pipes, pipelines, gates, valves, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such
transmission lines or any of them or adjacent thereto; together with all real
property, right of way, easements, permits, privileges, franchises and rights
for or relating to the construction, maintenance or operation thereof, through,
over, under or upon any private property or any public streets or highways,
within as well as without the corporate limits of any municipal corporation.
VIII.
GAS DISTRIBUTION SYSTEMS
A-17
All the gas distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including tunnels, conduits, gas mains and pipes, service pipes, fittings,
gates, valves, connections, meters and other appliances and equipment, and all
other property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such distribution systems or any of them
or adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises, grants and rights, for or relating to the
construction, maintenance or operation thereof, through, over, under or upon any
private property or any public streets or highways within as well as without the
corporate limits of any municipal corporation.
IX.
OFFICE BUILDINGS, SERVICE BUILDINGS, GARAGES, ETC.
All office, garage, service and other buildings of the Company,
wherever located, in the State of Michigan, constructed or otherwise acquired by
it and not heretofore described in the Indenture or any supplement thereto and
not heretofore released from the lien of the Indenture, together with the land
on which the same are situated and all easements, rights of way and
appurtenances to said lands, together with all furniture and fixtures located in
said buildings.
X.
TELEPHONE PROPERTIES AND
RADIO COMMUNICATION EQUIPMENT
All telephone lines, switchboards, systems and equipment of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
lien of the Indenture, used or available for use in the operation of its
properties, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such telephone
properties or any of them or adjacent thereto; together with all real estate,
rights of way, easements, permits, privileges, franchises, property, devices or
rights related to the dispatch, transmission, reception or reproduction of
messages, communications, intelligence, signals, light, vision or sound by
electricity, wire or otherwise, including all telephone equipment installed in
buildings used as general and regional offices, substations and generating
stations and all telephone lines erected on towers and poles; and all radio
communication equipment of the Company, together with all property, real or
personal (except any in the Indenture expressly excepted), fixed stations,
towers, auxiliary radio buildings and equipment, and all appurtenances used in
connection therewith, wherever located, in the State of Michigan.
XI.
OTHER REAL PROPERTY
All other real property of the Company and all interests therein, of
every nature and description (except any in the Indenture expressly excepted)
wherever located, in the State of
A-18
Michigan, acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture.
Such real property includes but is not limited to the following described
property, such property is subject to any interests that were excepted or
reserved in the conveyance to the Company:
ALCONA COUNTY
Certain land in Caledonia Township, Alcona County, Michigan described
as:
The East 330 feet of the South 660 feet of the SW 1/4 of the
SW 1/4 of Section 8, T28N, R8E, except the West 264 feet of the South
330 feet thereof; said land being more particularly described as
follows: To find the place of beginning of this description, commence
at the Southwest corner of said section, run thence East along the
South line of said section 1243 feet to the place of beginning of this
description, thence continuing East along said South line of said
section 66 feet to the West 1/8 line of said section, thence N 02
degrees 09' 30" E along the said West 1/8 line of said section 660
feet, thence West 330 feet, thence S 02 degrees 09' 30" W, 330 feet,
thence East 264 feet, thence S 02 degrees 09' 30" W, 330 feet to the
place of beginning.
ALLEGAN COUNTY
Certain land in ▇▇▇ Township, Allegan County, Michigan described as:
The NE 1/4 of the NW 1/4 of Section 16, T1N, R15W.
ALPENA COUNTY
Certain land in ▇▇▇▇▇▇ and Green Townships, Alpena County, Michigan
described as:
All that part of the S'ly 1/2 of the former Boyne City-▇▇▇▇▇▇▇
and Alpena Railroad right of way, being the Southerly 50 feet of a 100
foot strip of land formerly occupied by said Railroad, running from the
East line of Section 31, T31N, R7E, Southwesterly across said Section
31 and Sections 5 and 6 of T30N, R7E and Sections 10, 11 and the E 1/2
of Section 9, except the West 1646 feet thereof, all in T30N, R6E.
ANTRIM COUNTY
Certain land in Mancelona Township, Antrim County, Michigan described
as:
The S 1/2 of the NE 1/4 of Section 33, T29N, R6W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the State of Michigan to August ▇. ▇▇▇▇▇▇ and ▇▇▇▇ ▇. ▇▇▇▇▇▇, his wife,
A-19
dated April 15, 1946 and recorded May 20, 1946 in Liber 97 of Deeds on
page 682 of Antrim County Records.
ARENAC COUNTY
Certain land in ▇▇▇▇▇▇▇▇ Township, Arenac County, Michigan described
as:
A parcel of land in the SW 1/4 of the NW 1/4 of Section 12,
T18N, R4E, described as follows: To find the place of beginning of said
parcel of land, commence at the ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇,
▇▇▇; run thence South along the West line of said section, said West
line of said section being also the center line of ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇.▇▇ feet to the W 1/4 post of said section and the place of
beginning of said parcel of land; running thence N 88 degrees 26' 00" E
along the East and West 1/4 line of said section, 660.0 feet; thence
North parallel with the West line of said section, 310.0 feet; thence S
88 degrees 26' 00" W, 330.0 feet; thence South parallel with the West
line of said section, 260.0 feet; thence S 88 degrees 26' 00" W, 330.0
feet to the West line of said section and the center line of East City
Limits Road; thence South along the said West line of said section,
50.0 feet to the place of beginning.
▇▇▇▇▇ COUNTY
Certain land in Johnstown Township, ▇▇▇▇▇ County, Michigan described
as:
A strip of land 311 feet in width across the SW 1/4 of the NE
1/4 of Section 31, T1N, R8W, described as follows: To find the place of
beginning of this description, commence at the E -1/4 post of said
section; run thence N 00 degrees 55' 00" E along the East line of said
section, 555.84 feet; thence N 59 degrees 36' 20" W, 1375.64 feet;
thence N 88 degrees 30' 00" W, 130 feet to a point on the East 1/8 line
of said section and the place of beginning of this description; thence
continuing N 88 degrees 30' 00" W, 1327.46 feet to the North and South
1/4 line of said section; thence S 00 degrees 39'35" W along said North
and South 1/4 line of said section, 311.03 feet to a point, which said
point is 952.72 feet distant N'ly from the East and West 1/4 line of
said section as measured along said North and South 1/4 line of said
section; thence S 88 degrees 30' 00" E, 1326.76 feet to the East 1/8
line of said section; thence N 00 degrees 47' 20" E along said East 1/8
line of said section, 311.02 feet to the place of beginning.
BAY COUNTY
Certain land in Frankenlust Township, Bay County, Michigan described
as:
The South 250 feet of the N 1/2 of the W 1/2 of the ▇ ▇/▇ ▇▇
▇▇▇ ▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇, ▇▇▇▇, ▇▇▇.
A-20
BENZIE COUNTY
Certain land in Benzonia Township, Benzie County, Michigan described
as:
A parcel of land in the Northeast 1/4 of Section 7, Township
26 North, Range 14 West, described as beginning at a point on the East
line of said Section 7, said point being 320 feet North measured along
the East line of said section from the East 1/4 post; running thence
West 165 feet; thence North parallel with the East line of said section
165 feet; thence East 165 feet to the East line of said section; thence
South 165 feet to the place of beginning.
BRANCH COUNTY
Certain land in ▇▇▇▇▇▇ Township, Branch County, Michigan described as:
A parcel of land in the NE 1/4 of Section 23 T5S, R6W,
described as beginning at a point on the North and South quarter line
of said section at a point 1278.27 feet distant South of the North
quarter post of said section, said distance being measured along the
North and South quarter line of said section, running thence S89
degrees 21'E 250 feet, thence North along a line parallel with the said
North and South quarter line of said section 200 feet, thence N89
degrees 21'W 250 feet to the North and South quarter line of said
section, thence South along said North and South quarter line of said
section 200 feet to the place of beginning.
▇▇▇▇▇▇▇ COUNTY
Certain land in ▇▇▇▇▇▇ Township, ▇▇▇▇▇▇▇ County, Michigan described as:
A parcel of land in the SE 1/4 of the SE 1/4 of Section 32,
T1S, R6W, described as follows: To find the place of beginning of this
description, commence at the Southeast corner of said section; run
thence North along the East line of said section 1034.32 feet to the
place of beginning of this description; running thence N 89 degrees 39'
52" W, 333.0 feet; thence North 290.0 feet to the South 1/8 line of
said section; thence S 89 degrees 39' 52" E along said South 1/8 line
of said section 333.0 feet to the East line of said section; thence
South along said East line of said section 290.0 feet to the place of
beginning. (Bearings are based on the ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇,
▇▇▇, from the Southeast corner of said section to the Northeast corner
of said section assumed as North.)
CASS COUNTY
Certain easement rights located across land in Marcellus Township, Cass
County, Michigan described as:
▇-▇▇
▇▇▇ ▇▇▇▇ ▇ ▇▇▇▇ of the SW 1/4 of the ▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇, ▇▇▇,
▇▇▇▇.
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ land in South Arm Township, Charlevoix County, Michigan
described as:
A parcel of land in the SW 1/4 of Section 29, T32N, R7W,
described as follows: Beginning at the Southwest corner of said section
and running thence North along the West line of said section 788.25
feet to a point which is 528 feet distant South of the South 1/8 line
of said section as measured along the said West line of said section;
thence N 89 degrees 30' 19" E, parallel with said South 1/8 line of
said section 442.1 feet; thence South 788.15 feet to the South line of
said section; thence S 89 degrees 29' 30" W, along said South line of
said section 442.1 feet to the place of beginning.
CHEBOYGAN COUNTY
Certain land in Inverness Township, Cheboygan County, Michigan
described as:
A parcel of land in the SW frl 1/4 of Section 31, T37N, R2W,
described as beginning at the Northwest corner of the SW frl 1/4,
running thence East on the East and West quarter line of said Section,
40 rods, thence South parallel to the West line of said Section 40
rods, thence West 40 rods to the West line of said Section, thence
North 40 rods to the place of beginning.
CLARE COUNTY
Certain land in Frost Township, Clare County, Michigan described as:
The East 150 feet of the North 225 feet of the NW 1/4 of the
NW 1/4 of Section 15, T20N, R4W.
CLINTON COUNTY
Certain land in Watertown Township, Clinton County, Michigan described
as:
The NE 1/4 of the NE 1/4 of the SE 1/4 of Section 22, and the
North 165 feet of the NW 1/4 of the NE 1/4 of the SE 1/4 of Section 22,
T5N, R3W.
▇▇▇▇▇▇▇▇ COUNTY
Certain land in Lovells Township, ▇▇▇▇▇▇▇▇ County, Michigan described
as:
A-22
A parcel of land in ▇▇▇▇▇▇▇ ▇, ▇▇▇▇, ▇▇▇, described as:
Commencing at NW corner said section; thence South 89 degrees 53'30"
East along North section line 105.78 feet to point of beginning; thence
South 89 degrees 53'30" East along North section line 649.64 feet;
thence South 55 degrees 42'30" East 340.24 feet; thence South 55
degrees 44' 37"" East 5,061.81 feet to the East section line; thence
South 00 degrees 00' 08"" West along East section line 441.59 feet;
thence North 55 degrees 44' 37" West 5,310.48 feet; thence North 55
degrees 42'30" West 877.76 feet to point of beginning.
▇▇▇▇▇ COUNTY
Certain land in ▇▇▇▇▇ Township, ▇▇▇▇▇ County, Michigan described as:
A parcel of land in the SW 1/4 of Section 6, T2N, R4W,
described as follows: To find the place of beginning of this
description commence at the Southwest corner of said section; run
thence N 89 degrees 51' 30" E along the South line of said section 400
feet to the place of beginning of this description; thence continuing N
89 degrees 51' 30" E, 500 feet; thence N 00 degrees 50' 00" W, 600
feet; thence S 89 degrees 51' 30" W parallel with the South line of
said section 500 feet; thence S 00 degrees 50' 00" E, 600 feet to the
place of beginning.
EMMET COUNTY
Certain land in Wawatam Township, Emmet County, Michigan described as:
The West 1/2 of the Northeast 1/4 of the ▇▇▇▇▇▇▇▇▇ ▇/▇ ▇▇
▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Certain land in Argentine Township, Genesee County, Michigan described
as:
A parcel of land of part of the SW 1/4 of Section 8, T5N, R5E,
being more particularly described as follows:
Beginning at a point of the West line of ▇▇▇▇▇▇▇▇ Road, 100
feet wide, (as now established) distant 829.46 feet measured N01
degrees 42'56"W and 50 feet measured S88 degrees 14'04"W from the ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇, ▇▇▇, ▇▇▇; thence S88 degrees 14'04"W a
distance of 550 feet; thence N01 degrees 42'56"W a distance of 500 feet
to a point on the North line of the South half of the Southwest quarter
of said Section 8; thence N88 degrees 14'04"E along the North line of
South half of the Southwest quarter of said Section 8 a distance 550
feet to a point on the West line of ▇▇▇▇▇▇▇▇ Road, 100 feet wide (as
now established); thence
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S01 degrees 42'56"E along the West line of said ▇▇▇▇▇▇▇▇ Road a
distance of 500 feet to the point of beginning.
GLADWIN COUNTY
Certain land in ▇▇▇▇▇▇ Township, Gladwin County, Michigan described as:
The East 400 feet of the South 450 feet of ▇▇▇▇▇▇▇ ▇, ▇▇▇▇,
▇▇▇.
GRAND TRAVERSE COUNTY
Certain land in ▇▇▇▇▇▇▇▇ Township, Grand Traverse County, Michigan
described as:
A parcel of land in the ▇▇▇▇▇▇▇▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇, ▇▇▇▇,
▇▇▇▇, described as follows: Commencing at the Northwest corner of said
section, running thence S 89 degrees 19'15" E along the North line of
said section and the center line of ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ feet, thence South
400 feet, thence N 89 degrees 19'15" W 225 feet to the West line of
said section and the center line of Hannah Road, thence North along the
West line of said section and the center line of Hannah Road 400 feet
to the place of beginning for this description.
GRATIOT COUNTY
Certain land in ▇▇▇▇▇▇ Township, Gratiot County, Michigan described as:
A parcel of land in the NE 1/4 of Section 7, Township 9 North,
Range 3 West, described as beginning at a point on the North line of
▇▇▇▇▇▇ Street in the Village of Middleton, which is 542 feet East of
the North and South one-quarter (1/4) line of said Section 7; thence
North 100 feet; thence East 100 feet; thence South 100 feet to the
North line of ▇▇▇▇▇▇ Street; thence West along the North line of ▇▇▇▇▇▇
Street 100 feet to place of beginning.
HILLSDALE COUNTY
Certain land in Litchfield Village, Hillsdale County, Michigan
described as:
▇▇▇ ▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇▇▇
Certain easement rights located across land in Sebewaing Township,
Huron County, Michigan described as:
The North 1/2 of the ▇▇▇▇▇▇▇▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇
A-24
Certain land in Vevay Township, ▇▇▇▇▇▇ County, Michigan described as:
A parcel of land 660 feet wide in the Southwest 1/4 of Section
7 lying South of the centerline of ▇▇▇▇▇ Road as extended to the
North-South 1/4 line of said ▇▇▇▇▇▇▇ ▇, ▇▇▇, ▇▇▇, more particularly
described as follows: Commence at the Southwest corner of said Section
7, thence North along the West line of said Section 2502.71 feet to the
centerline of ▇▇▇▇▇ Road; thence South 89 degrees 54'45" East along
said centerline 2282.38 feet to the place of beginning of this
description; thence continuing South 89 degrees 54'45" East along said
centerline and said centerline extended 660.00 feet to the North-South
1/4 line of said section; thence South 00 degrees 07'20" West 1461.71
feet; thence North 89 degrees 34'58" West 660.00 feet; thence North 00
degrees 07'20" East 1457.91 feet to the centerline of ▇▇▇▇▇ Road and
the place of beginning.
IONIA COUNTY
Certain land in Sebewa Township, Ionia County, Michigan described as:
A strip of land 280 feet wide across that part of the SW 1/4
of the NE 1/4 of Section 15, T5N, R6W, described as follows:
To find the place of beginning of this description commence at
the E 1/4 corner of said section; run thence N 00 degrees 05' 38" W
along the East line of said section, 1218.43 feet; thence S 67 degrees
18' 24" W, 1424.45 feet to the East 1/8 line of said section and the
place of beginning of this description; thence continuing S 67 degrees
18' 24" W, 1426.28 feet to the North and South 1/4 line of said section
at a point which said point is 105.82 feet distant N'ly of the center
of said section as measured along said North and South 1/4 line of said
section; thence N 00 degrees 04' 47" E along said North and South 1/4
line of said section, 303.67 feet; thence N 67 degrees 18' 24" E,
1425.78 feet to the East 1/8 line of said section; thence S 00 degrees
00' 26" E along said East 1/8 line of said section, 303.48 feet to the
place of beginning. (Bearings are based on the ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇,
▇▇▇, ▇▇▇, from the E 1/4 corner of said section to the Northeast corner
of said section assumed as N 00 degrees 05' 38" W.)
IOSCO COUNTY
Certain land in Alabaster Township, Iosco County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 34, T21N, R7E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence
South along the North and South 1/4 line of said section, 1354.40 feet
to the place of beginning of this description; thence continuing South
along the said
A-25
North and South 1/4 line of said section, 165.00 feet to a point on the
said North and South 1/4 line of said section which said point is
1089.00 feet distant North of the center of said section; thence West
440.00 feet; thence North 165.00 feet; thence East 440.00 feet to the
said North and South 1/4 line of said section and the place of
beginning.
▇▇▇▇▇▇▇▇ COUNTY
Certain land in Chippewa Township, ▇▇▇▇▇▇▇▇ County, Michigan described
as:
The North 8 rods of the NE 1/4 of the SE 1/4 of Section 29,
T14N, R3W.
▇▇▇▇▇▇▇ COUNTY
Certain land in Waterloo Township, ▇▇▇▇▇▇▇ County, Michigan described
as:
A parcel of land in the North fractional part of the N
fractional 1/2 of Section 2, T1S, R2E, described as follows: To find
the place of beginning of this description commence at the E 1/4 post
of said section; run thence N 01 degrees 03' 40" E along the East line
of said section 1335.45 feet to the North 1/8 line of said section and
the place of beginning of this description; thence N 89 degrees 32' 00"
W, 2677.7 feet to the North and South 1/4 line of said section; thence
S 00 degrees 59' 25" W along the North and South 1/4 line of said
section 22.38 feet to the North 1/8 line of said section; thence S 89
degrees 59' 10" W along the North 1/8 line of said section 2339.4 feet
to the center line of State Trunkline Highway M-52; thence N 53 degrees
46' 00" W along the center line of said State Trunkline Highway 414.22
feet to the West line of said section; thence N 00 degrees 55' 10" E
along the West line of said section 74.35 feet; thence S 89 degrees 32'
00" E, 5356.02 feet to the East line of said section; thence S 01
degrees 03' 40" W along the East line of said section 250 feet to the
place of beginning.
KALAMAZOO COUNTY
Certain land in Alamo Township, Kalamazoo County, Michigan described
as:
The South 350 feet of the NW 1/4 of the NW 1/4 of Section 16,
T1S, R12W, being more particularly described as follows: To find the
place of beginning of this description, commence at the Northwest
corner of said section; run thence S 00 degrees 36' 55" W along the
West line of said section 971.02 feet to the place of beginning of this
description; thence continuing S 00 degrees 36' 55" W along said West
line of said section 350.18 feet to the North 1/8 line of said section;
thence S 87 degrees 33' 40" E along the said North 1/8 line of said
section 1325.1 feet to the West 1/8 line of said section; thence N 00
degrees 38' 25" E along
A-26
the said West 1/8 line of said section 350.17 feet; thence N 87 degrees
33' 40" W, 1325.25 feet to the place of beginning.
KALKASKA COUNTY
Certain land in Kalkaska Township, Kalkaska County, Michigan described
as:
The NW 1/4 of the SW 1/4 of Section 4, T27N, R7W, excepting
therefrom all mineral, coal, oil and gas and such other rights as were
reserved unto the State of Michigan in that certain deed running from
the Department of Conservation for the State of Michigan to ▇▇▇▇▇▇
▇▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇, his wife, dated October 9, 1934 and recorded
December 28, 1934 in Liber 39 on page 291 of Kalkaska County Records,
and subject to easement for pipeline purposes as granted to Michigan
Consolidated Gas Company by first party herein on April 4, 1963 and
recorded June 21, 1963 in Liber 91 on page 631 of Kalkaska County
Records.
KENT COUNTY
Certain land in Caledonia Township, Kent County, Michigan described as:
A parcel of land in the Northwest fractional 1/4 of Section
15, T5N, R10W, described as follows: To find the place of beginning of
this description commence at the North 1/4 corner of said section, run
thence S 0 degrees 59' 26" E along the North and South 1/4 line of said
section 2046.25 feet to the place of beginning of this description,
thence continuing S 0 degrees 59' 26" E along said North and South 1/4
line of said section 332.88 feet, thence S 88 degrees 58' 30" W 2510.90
feet to a point herein designated "Point A" on the East bank of the
Thornapple River, thence continuing S 88 degrees 53' 30" W to the
center thread of the Thornapple River, thence NW'ly along the center
thread of said Thornapple River to a point which said point is S 88
degrees 58' 30" W of a point on the East bank of the Thornapple River
herein designated "Point B", said "Point B" being N 23 degrees 41' 35"
W 360.75 feet from said above-described "Point A", thence N 88 degrees
58' 30" E to said "Point B", thence continuing N 88 degrees 58' 30" E
2650.13 feet to the place of beginning. (Bearings are based on the ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇, ▇▇▇▇ between the East 1/4 corner of said
section and the Northeast corner of said section assumed as N 0 degrees
59' 55" W.)
LAKE COUNTY
Certain land in Pinora and Cherry Valley Townships, Lake County,
Michigan described as:
A-27
A strip of land 50 feet wide East and West along and adjoining
the West line of highway on the East side of the ▇▇▇▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇, ▇▇▇▇. Also a strip of land 100 feet wide East and West along
and adjoining the East line of the highway on the West side of
following described land: The South 1/2 of NW 1/4, and the South 1/2 of
the NW 1/4 of the SW 1/4, all in ▇▇▇▇▇▇▇ ▇, ▇▇▇▇, ▇▇▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ land in ▇▇▇▇▇▇ Township, Lapeer County, Michigan described as:
The South 825 feet of the W 1/2 of the ▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇,
▇▇▇, ▇▇▇, except the West 1064 feet thereof.
LEELANAU COUNTY
Certain land in Cleveland Township, Leelanau County, Michigan described
as:
The North 200 feet of the West 180 feet of the SW 1/4 of the
▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ land in Madison Township, Lenawee County, Michigan described
as:
A strip of land 165 feet wide off the West side of the
following described premises: The E 1/2 of the SE 1/4 of Section 12.
The E 1/2 of the NE 1/4 and the NE 1/4 of the SE 1/4 of Section 13,
being all in T7S, R3E, excepting therefrom a parcel of land in the E
1/2 of the ▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇, ▇▇▇, beginning at the Northwest
corner of said E 1/2 of the SE 1/4 of Section 12, running thence East 4
rods, thence South 6 rods, thence West 4 rods, thence North 6 rods to
the place of beginning.
▇▇▇▇▇▇▇▇▇▇ COUNTY
Certain land in Cohoctah Township, ▇▇▇▇▇▇▇▇▇▇ County, Michigan
described as:
Parcel 1
The East 390 feet of the East 50 rods of the ▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇
▇▇, ▇▇▇, ▇▇▇.
Parcel 2
A parcel of land in the NW 1/4 of Section 31, T4N, R4E,
described as follows: To find the place of beginning of this
description commence at the N 1/4 post of said section; run thence N 89
degrees 13' 06" W along the North line of said section, 330 feet to the
place of beginning of this
A-28
description; running thence S 00 degrees 52' 49" W, 2167.87 feet;
thence N 88 degrees 59' 49" W, 60 feet; thence N 00 degrees 52' 49" E,
2167.66 feet to the North line of said section; thence S 89 degrees 13'
06" E along said North line of said section, 60 feet to the place of
beginning.
MACOMB COUNTY
Certain land in Macomb Township, Macomb County, Michigan described as:
A parcel of land commencing on the West line of the E 1/2 of
the NW 1/4 of fractional Section 6, 20 chains South of the NW corner of
said E 1/2 of the NW 1/4 of Section 6; thence South on said West line
and the East line of A. ▇▇▇▇▇ ▇▇▇▇▇▇'▇ ▇▇▇▇▇ Road Subdivision #15,
according to the recorded plat thereof, as recorded in Liber 24 of
Plats, on page 7, 24.36 chains to the East and West 1/4 line of said
Section 6; thence East on said East and West 1/4 line 8.93 chains;
thence North parallel with the said West line of the E 1/2 of the NW
1/4 of Section 6, 24.36 chains; thence West 8.93 chains to the place of
beginning, all in T3N, R13E.
MANISTEE COUNTY
Certain land in Manistee Township, Manistee County, Michigan described
as:
A parcel of land in the SW 1/4 of Section 20, T22N, R16W,
described as follows: To find the place of beginning of this
description, commence at the Southwest corner of said section; run
thence East along the South line of said section 832.2 feet to the
place of beginning of this description; thence continuing East along
said South line of said section 132 feet; thence North 198 feet; thence
West 132 feet; thence South 198 feet to the place of beginning,
excepting therefrom the South 2 rods thereof which was conveyed to
Manistee Township for highway purposes by a Quitclaim Deed dated June
13, 1919 and recorded July 11, 1919 in Liber 88 of Deeds on page 638 of
Manistee County Records.
▇▇▇▇▇ COUNTY
Certain land in Riverton Township, ▇▇▇▇▇ County, Michigan described as:
Parcel 1
The South 10 acres of the West 20 acres of the S 1/2 of the NE
1/4 of Section 22, T17N, R17W.
Parcel 2
A parcel of land containing 4 acres of the West side of
highway, said parcel of land being described as commencing 16 rods
South of the
A-29
Northwest corner of the NW 1/4 of the SW -1/4 of Section 22, T17N,
R17W, running thence South 64 rods, thence NE'ly and N'ly and NW'ly
along the W'ly line of said highway to the place of beginning, together
with any and all right, title, and interest of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ in and to that portion of the hereinbefore
mentioned highway lying adjacent to the E'ly line of said above
described land.
MECOSTA COUNTY
Certain land in Wheatland Township, Mecosta County, Michigan described
as:
A parcel of land in the SW 1/4 of the SW 1/4 of Section 16,
T14N, R7W, described as beginning at the Southwest corner of said
section; thence East along the South line of Section 133 feet; thence
North parallel to the West section line 133 feet; thence West 133 feet
to the West line of said Section; thence South 133 feet to the place of
beginning.
MIDLAND COUNTY
Certain land in Ingersoll Township, Midland County, Michigan described
as:
The West 200 feet of the W 1/2 of the NE 1/4 of Section 4,
T13N, R2E.
MISSAUKEE COUNTY
Certain land in Norwich Township, Missaukee County, Michigan described
as:
A parcel of land in the NW 1/4 of the NW 1/4 of Section 16,
T24N, R6W, described as follows: Commencing at the Northwest corner of
said section, running thence N 89 degrees 01' 45" E along the North
line of said section 233.00 feet; thence South 233.00 feet; thence S 89
degrees 01' 45" W, 233.00 feet to the West line of said section; thence
North along said West line of said section 233.00 feet to the place of
beginning. (Bearings are based on the ▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇,
▇▇▇, between the Southwest and Northwest corners of said section
assumed as North.)
MONROE COUNTY
Certain land in ▇▇▇▇▇▇▇▇▇ Township, Monroe County, Michigan described
as:
A parcel of land in the ▇▇▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇, ▇▇▇,
described as follows: To find the place of beginning of this
description commence at the S 1/4 post of said section; run thence West
along the South line of said section 1269.89 feet to the place of
beginning of this description; thence
A-30
continuing West along said South line of said section 100 feet; thence
N 00 degrees 50' 35" E, 250 feet; thence East 100 feet; thence S 00
degrees 50' 35" W parallel with and 16.5 feet distant W'ly of as
measured perpendicular to the West 1/8 line of said section, as
occupied, a distance of 250 feet to the place of beginning.
MONTCALM COUNTY
Certain land in Crystal Township, Montcalm County, Michigan described
as:
The N 1/2 of the S 1/2 of the SE 1/4 of Section 35, T10N, R5W.
MONTMORENCY COUNTY
Certain land in the Village of ▇▇▇▇▇▇▇, Montmorency County, Michigan
described as:
▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, being a subdivision in the
South 1/2 of the ▇▇▇▇▇▇▇▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇, according to
the plat thereof recorded in Liber 4 of Plats on Pages 32-34,
Montmorency County Records.
MUSKEGON COUNTY
Certain land in Casnovia Township, Muskegon County, Michigan described
as:
The West 433 feet of the North 180 feet of the South 425 feet
of the SW 1/4 of Section 3, T10N, R13W.
NEWAYGO COUNTY
Certain land in Ashland Township, Newaygo County, Michigan described
as:
The West 250 feet of the NE 1/4 of Section 23, T11N, R13W.
OAKLAND COUNTY
Certain land in Wixcom City, Oakland County, Michigan described as:
The E 75 feet of the N 160 feet of the N 330 feet of the W
526.84 feet of the NW 1/4 of the NW 1/4 of Section 8, T1N, R8E, more
particularly described as follows: Commence at the NW corner of said
Section 8, thence N 87 degrees 14' 29" E along the North line of said
Section 8 a distance of 451.84 feet to the place of beginning for this
description; thence continuing N 87 degrees 14' 29" E along said North
section line a distance of 75.0 feet to the East line of the West
526.84 feet of the NW 1/4 of the NW 1/4 of said Section 8; thence S 02
degrees 37' 09" E along said East line a distance of 160.0 feet; thence
S 87 degrees 14'
A-31
29" W a distance of 75.0 feet; thence N 02 degrees 37' 09" W a distance
of 160.0 feet to the place of beginning.
OCEANA COUNTY
Certain land in Crystal Township, Oceana County, Michigan described as:
The East 290 feet of the SE 1/4 of the NW 1/4 and the East 290
feet of the NE 1/4 of the SW 1/4, all in ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇
Certain land in West Branch Township, Ogemaw County, Michigan described
as:
The South 660 feet of the East 660 feet of the NE 1/4 of the
NE 1/4 of Section 33, T22N, R2E.
OSCEOLA COUNTY
Certain land in ▇▇▇▇▇▇ Township, Osceola County, Michigan described as:
A parcel of land in the North 1/2 of the ▇▇▇▇▇▇▇▇▇ ▇/▇ ▇▇
▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇, described as commencing at the Northeast corner
of said Section; thence West along the North Section line 999 feet to
the point of beginning of this description; thence S 01 degrees 54' 20"
E 1327.12 feet to the North 1/8 line; thence S 89 degrees 17' 05" W
along the North 1/8 line 330.89 feet; thence N 01 degrees 54' 20" W
1331.26 feet to the North Section line; thence East along the North
Section line 331 feet to the point of beginning.
OSCODA COUNTY
Certain land in ▇▇▇▇▇▇ Township, Oscoda County, Michigan described as:
The East 400 feet of the South 580 feet of the ▇ ▇/▇ ▇▇ ▇▇▇ ▇▇
▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇.
OTSEGO COUNTY
Certain land in Corwith Township, Otsego County, Michigan described as:
Part of the NW 1/4 of the NE 1/4 of Section 28, T32N, R3W,
described as: Beginning at the N 1/4 corner of said section; running
thence S 89 degrees 04' 06" E along the North line of said section,
330.00 feet; thence S 00 degrees 28' 43" E, 400.00 feet; thence N 89
degrees 04' 06" W, 330.00 feet to the North and South 1/4 line of said
section; thence N 00 degrees 28' 43" W along the said North and South
1/4 line of said section,
A-32
400.00 feet to the point of beginning; subject to the use of the N'ly
33.00 feet thereof for highway purposes.
OTTAWA COUNTY
Certain land in ▇▇▇▇▇▇▇▇ Township, Ottawa County, Michigan described
as:
The North 660 feet of the West 660 feet of the NE 1/4 of the
NW 1/4 of Section 26, T7N, R15W.
PRESQUE ISLE COUNTY
Certain land in ▇▇▇▇▇▇▇ and Pulawski Townships, Presque Isle County,
Michigan described as:
Part of the South half of the ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇,
▇▇▇▇, ▇▇▇, and part of the ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇,
more fully described as: Commencing at the East -1/4 corner of said
Section 24; thence N 00 degrees 15'47" E, 507.42 feet, along the East
line of said Section 24 to the point of beginning; thence S 88
degrees 15'36" W, 400.00 feet, parallel with the North 1/8 line of said
Section 24; thence N 00 degrees 15'47" E, 800.00 feet, parallel with
said East line of Section 24; thence N 88 degrees 15'36"E, 800.00 feet,
along said North 1/8 line of Section 24 and said line extended; thence
S 00 degrees 15'47" W, 800.00 feet, parallel with said East line of
Section 24; thence S 88 degrees 15'36" W, 400.00 feet, parallel with
said North 1/8 line of Section 24 to the point of beginning.
Together with a 33 foot easement along the West 33 feet of the
Northwest quarter lying North of the North 1/8 line of ▇▇▇▇▇▇▇ ▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, extended, in ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇, ▇▇▇.
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ land in ▇▇▇▇▇▇▇ Township, Roscommon County, Michigan described
as:
A parcel of land in the NW 1/4 of Section 19, T24N, R3W,
described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section, run
thence East along the North line of said section 1,163.2 feet to the
place of beginning of this description (said point also being the place
of intersection of the West 1/8 line of said section with the North
line of said section), thence S 01 degrees 01' E along said West 1/8
line 132 feet, thence West parallel with the North line of said section
132 feet, thence N 01 degrees 01' W parallel with said West 1/8 line of
said section 132 feet to the North line of said section, thence East
along the North line of said section 132 feet to the place of
beginning.
A-33
SAGINAW COUNTY
Certains land in ▇▇▇▇▇▇ Township, Saginaw County, Michigan described
as:
A parcel of land in the SW 1/4 of Section 13, T9N, R1E,
described as follows: To find the place of beginning of this
description commence at the Southwest corner of said section; run
thence North along the West line of said section 1581.4 feet to the
place of beginning of this description; thence continuing North along
said West line of said section 230 feet to the center line of a creek;
thence S 70 degrees 07' 00" E along said center line of said creek
196.78 feet; thence South 163.13 feet; thence West 185 feet to the West
line of said section and the place of beginning.
SANILAC COUNTY
Certain easement rights located across land in Minden Township, Sanilac
County, Michigan described as:
The Southeast 1/4 of the Southeast 1/4 of Section 1, T14N,
R14E, excepting therefrom the South 83 feet of the East 83 feet
thereof.
SHIAWASSEE COUNTY
Certain land in ▇▇▇▇▇ Township, Shiawassee County, Michigan described
as:
The South 330 feet of the ▇ ▇/▇ ▇▇ ▇▇▇ ▇▇ ▇/▇ ▇▇ ▇▇▇▇▇▇▇ ▇▇,
▇▇▇, ▇▇▇.
ST. CLAIR COUNTY
Certain land in ▇▇▇ Township, St. Clair County, Michigan described as:
The N 1/2 of the NW 1/4 of the NE 1/4 of Section 6, T3N, R15E.
ST. ▇▇▇▇▇▇ COUNTY
Certain land in Mendon Township, St. ▇▇▇▇▇▇ County, Michigan described
as:
The North 660 feet of the West 660 feet of the NW 1/4 of ▇▇
▇/▇, ▇▇▇▇▇▇▇ ▇▇, ▇▇▇, ▇▇▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Certain land in Millington Township, Tuscola County, Michigan described
as:
A strip of land 280 feet wide across the East 96 rods of the
South 20 rods of the N 1/2 of the SE 1/4 of Section 34, T10N, R8E, more
particularly described as commencing at the Northeast corner of Section
3,
A-34
T9N, R8E, thence S 89 degrees 55' 35" W along the South line of said
Section 34 a distance of 329.65 feet, thence N 18 degrees 11' 50" W a
distance of 1398.67 feet to the South 1/8 line of said Section 34 and
the place of beginning for this description; thence continuing N 18
degrees 11' 50" W a distance of 349.91 feet; thence N 89 degrees 57'
01" W a distance of 294.80 feet; thence S 18 degrees 11' 50" E a
distance of 350.04 feet to the South 1/8 line of said Section 34;
thence S 89 degrees 58' 29" E along the South 1/8 line of said section
a distance of 294.76 feet to the place of beginning.
VAN BUREN COUNTY
Certain land in Covert Township, Van Buren County, Michigan described
as:
All that part of the West 20 acres of the N 1/2 of the NE
fractional 1/4 of Section 1, T2S, R17W, except the West 17 rods of the
North 80 rods, being more particularly described as follows: To find
the place of beginning of this description commence at the N 1/4 post
of said section; run thence N 89 degrees 29' 20" E along the North line
of said section 280.5 feet to the place of beginning of this
description; thence continuing N 89 degrees 29' 20" E along said North
line of said section 288.29 feet; thence S 00 degrees 44' 00" E,
1531.92 feet; thence S 89 degrees 33' 30" W, 568.79 feet to the North
and South 1/4 line of said section; thence N 00 degrees 44' 00" W along
said North and South 1/4 line of said section 211.4 feet; thence N 89
degrees 29' 20" E, 280.5 feet; thence N 00 degrees 44' 00" W, 1320 feet
to the North line of said section and the place of beginning.
WASHTENAW COUNTY
Certain land in Manchester Township, Washtenaw County, Michigan
described as:
A parcel of land in the NE 1/4 of the NW 1/4 of Section 1,
T4S, R3E, described as follows: To find the place of beginning of this
description commence at the Northwest corner of said section; run
thence East along the North line of said section 1355.07 feet to the
West 1/8 line of said section; thence S 00 degrees 22' 20" E along said
West 1/8 line of said section 927.66 feet to the place of beginning of
this description; thence continuing S 00 degrees 22' 20" E along said
West 1/8 line of said section 660 feet to the North 1/8 line of said
section; thence N 86 degrees 36' 57" E along said North 1/8 line of
said section 660.91 feet; thence N 00 degrees 22' 20" W, 660 feet;
thence S 86 degrees 36' 57" W, 660.91 feet to the place of beginning.
▇▇▇▇▇ COUNTY
Certain land in Livonia City, ▇▇▇▇▇ County, Michigan described as:
A-35
Commencing at the ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ ▇, ▇▇▇, ▇▇▇;
thence North along the East line of Section 6 a distance of 253 feet to
the point of beginning; thence continuing North along the East line of
Section 6 a distance of 50 feet; thence Westerly parallel to the South
line of Section 6, a distance of 215 feet; thence Southerly parallel to
the East line of Section 6 a distance of 50 feet; thence easterly
parallel with the South line of Section 6 a distance of 215 feet to the
point of beginning.
WEXFORD COUNTY
Certain land in Selma Township, Wexford County, Michigan described as:
A parcel of land in the NW 1/4 of Section 7, T22N, R10W,
described as beginning on the North line of said section at a point 200
feet East of the West line of said section, running thence East along
said North section line 450 feet, thence South parallel with said West
section line 350 feet, thence West parallel with said North section
line 450 feet, thence North parallel with said West section line 350
feet to the place of beginning.
SECTION 12. The Company is a transmitting utility under Section 9501(2)
of the Michigan Uniform Commercial Code (M.C.L. 440.9501(2)) as defined in
M.C.L. 440.9102(1)(aaaa).
IN WITNESS WHEREOF, said Consumers Energy Company has caused this
Supplemental Indenture to be executed in its corporate name by its Chairman of
the Board, President, a Vice President or its Treasurer and its corporate seal
to be hereunto affixed and to be attested by its Secretary or an Assistant
Secretary, and said JPMorgan Chase Bank, as Trustee as aforesaid, to evidence
its acceptance hereof, has caused this Supplemental Indenture to be executed in
its corporate name by a Vice President and its corporate seal to be hereunto
affixed and to be attested by a Trust Officer, in several counterparts, all as
of the day and year first above written.
A-36
CONSUMERS ENERGY COMPANY
(SEAL) By __________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Attest: Treasurer
______________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Assistant Secretary
Signed, sealed and delivered
by CONSUMERS ENERGY COMPANY
in the presence of
______________________________
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
______________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
STATE OF MICHIGAN )
ss.
COUNTY OF ▇▇▇▇▇▇▇ )
The foregoing instrument was acknowledged before me this ____
day of _____________, 2003, by ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Treasurer of CONSUMERS ENERGY
COMPANY, a Michigan corporation, on behalf of the corporation.
_____________________________________
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Notary Public
[SEAL] ▇▇▇▇▇▇▇ County, Michigan
My Commission Expires: June 14, 2004
S-1
JPMORGAN CHASE BANK, AS TRUSTEE
(SEAL) By __________________________________
▇. ▇'▇▇▇▇▇
Attest: Vice President
______________________________
Trust Officer
Signed, sealed and delivered
by JPMORGAN CHASE BANK
in the presence of
______________________________
______________________________
STATE OF NEW YORK )
ss.
COUNTY OF NEW YORK )
The foregoing instrument was acknowledged before me this ____
day of _____________, 2003, by ▇. ▇'▇▇▇▇▇, a Vice President of JPMORGAN CHASE
BANK, a New York corporation, on behalf of the corporation.
_____________________________________
Notary Public
[Seal] New York County, New York
My Commission Expires:
Prepared by:
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ When recorded, return to:
One Energy Plaza Consumers Energy Company
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Business Services Real Estate Dept.
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇ EP7-439
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
S-2
EXHIBIT B-1
REQUIRED OPINIONS FROM
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ESQ.
1. The Company is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Michigan.
2. The execution and delivery of the Credit Documents by the Company and the
performance by the Company of the Obligations have been duly authorized by
all necessary corporate action and proceedings on the part of the Company
and will not:
(a) contravene the Company's Restated Articles of Incorporation,
as amended, or bylaws;
(b) contravene any law or any contractual restriction imposed by
any indenture or any other agreement or instrument evidencing or
governing indebtedness for borrowed money of the Company; or
(c) result in or require the creation of any Lien upon or with
respect to any of the Company's properties except the lien of the
Indenture securing the Bonds and any Lien in favor of the Agent on the
Facility LC Collateral Account or any funds therein.
3. The Credit Documents have been duly executed and delivered by the Company.
4. To the best of my knowledge, there is no pending or threatened action or
proceeding against the Company or any of its Consolidated Subsidiaries
before any court, governmental agency or arbitrator (except (i) to the
extent described in the Company's annual report on Form 10-K for the year
ended December 31, 2002, and Quarterly Report on Form 10-Q for the quarter
ended June 30, 2003, in each case as filed with the SEC, and (ii) such
other similar actions, suits and proceedings predicated on the occurrence
of the same events giving rise to any actions, suits and proceedings
described in the reports referred to in clause (i) of this paragraph 4)
which might reasonably be expected to materially adversely affect the
financial condition or results of operations of the Company and its
Consolidated Subsidiaries, taken as a whole, or that would materially
adversely affect the Company's ability to perform its obligations under any
Credit Document. To the best of my knowledge, there is no litigation
challenging the validity or the enforceability of any of the Credit
Documents.
5. No authorization or approval or other action by, and no notice to or filing
with, any governmental authority or regulatory body is required for the due
execution, delivery and performance by the Company of any Credit Document,
except for the authorization to issue, sell or guarantee secured and/or
unsecured short-term debt granted by the Federal Energy Regulatory
Commission in Docket Nos. ES02-37-000 and ES03-37-000 (hereinafter the
"FERC Orders"). The FERC Orders are in full force and effect as of the date
hereof.
B-1-1
6. The Bonds, assuming due authentication in accordance with the terms of the
Indenture, are in due and proper form and, when delivered to the Agent
pursuant to the Bond Delivery Agreement, will evidence and secure the
Obligations owing under the Agreement and will be valid and enforceable
obligations of the Company in accordance with their terms, secured by the
lien of the Indenture on an equal and ratable basis with all other bonds
issued thereunder and otherwise entitled to the benefits provided by the
Indenture.
7. The Indenture has been qualified under the Trust Indenture Act of 1939, as
amended, and the execution and delivery of the Supplemental Indenture will
not cause the Indenture to not be so qualified.
8. The Company is not an "investment company" or a company "controlled" by an
"investment company" as such terms are defined in the Investment Company
Act of 1940, as amended.
9. The Company (i) is a "public utility" and a "subsidiary company" of a
"holding company", as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended (the "Holding Company Act"), and (ii) is
currently exempt from all provisions of the Holding Company Act, except
Section 9(a)(2) thereof.
10. In a properly presented case, a Michigan court or a federal court applying
Michigan choice of law rules should give effect to the choice of law
provisions of the Agreement and should hold that the Agreement is to be
governed by the laws of the State of New York rather than the laws of the
State of Michigan, except in the case of those provisions set forth in the
Agreement the enforcement of which would contravene a fundamental policy of
the State of Michigan. In the course of our review of the Agreement,
nothing has come to my attention to indicate that any of such provisions
would do so. Notwithstanding the foregoing, even if a Michigan court or a
federal court holds that the Agreement is to be governed by the laws of the
State of Michigan, the Agreement constitutes a legal, valid and binding
obligation of the Company, enforceable under Michigan law (including usury
provisions) against the Company in accordance with its terms, subject to
(a) the effect of applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors'
rights generally and (b) the application of general principles of equity
(regardless of whether considered in a proceeding in equity or at law).
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
REQUIRED OPINIONS FROM
SKADDEN, ARPS, SLATE, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
1. The execution and delivery of the Credit Documents by the
Company and the performance by the Company of the Obligations will not:
(a) contravene any contractual restriction imposed by the
Company Indentures; or
(b) result in or require the creation of any Lien upon or
with respect to any of the Company's properties pursuant to either of
the Company Indentures.
2. The Agreement constitutes a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its
terms, subject to (a) the effect of applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally and (b) the application of general principles of
equity (regardless of whether considered in a preceding in equity or at law).
3. "Company Indentures" means (i) the Indenture dated as of
January 1, 1996, as supplemented and amended from time to time, between the
Company (formerly known as Consumers Power Company) and The Bank of New York, as
Trustee, and (ii) the Indenture dated as of February 1, 1998, as supplemented
and amended from time to time, between the Company and JPMorgan Chase Bank
(formerly known as The Chase Manhattan Bank), as Trustee.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
REQUIRED OPINIONS FROM
MILLER, CANFIELD, PADDOCK AND STONE, P.L.C.
1. The Bonds, assuming due authentication in accordance with the
terms of the Indenture, are in due and proper form and, when delivered to the
Agent pursuant to the Bond Delivery Agreement, will evidence and secure the
Obligations owing under the Agreement and will be valid and enforceable
obligations of the Company in accordance with their terms, secured by the lien
of the Indenture on an equal and ratable basis with all other bonds issued
thereunder and otherwise entitled to the benefits provided by the Indenture.
B-3-1
EXHIBIT C
FORM OF COMPLIANCE CERTIFICATE
I, _________________, ______________ of Consumers Energy Company, a
Michigan corporation (the "Company"), DO HEREBY CERTIFY in connection with the
Amended and Restated Credit Agreement dated as of September __, 2003 (the
"Credit Agreement"; the terms defined therein being used herein as so defined)
among the Company, various financial institutions and Bank One, NA (Main Office
- Chicago), as Agent, that:
I. Section 8.1 of the Credit Agreement provides that the Company shall:
"At all times, maintain a ratio of Total Consolidated Debt to Total
Consolidated Capitalization of not greater than 0.65 to 1.0."
The following calculations are made in accordance with the definitions
of Total Consolidated Debt and Total Consolidated Capitalization in the
Credit Agreement and are correct and accurate as of _____________, ___:
A. Total Consolidated Debt
(a) Indebtedness for borrowed money $
plus (b) Indebtedness for deferred purchase price of
property/services
plus (c) Unfunded Vested Liabilities
plus (d) Obligations under acceptance facilities
plus (e) Obligations under Capital Leases
plus (f) Obligations under interest rate swap, "cap",
"collar" or other hedging agreement
plus (g) Guaranties, endorsements and
other contingent obligations
minus (h) Principal amount of any Securitized Bonds
minus (i) Junior Subordinated Debt owned by any Hybrid
Preferred Securities Subsidiary
minus (j) Subordinated guaranties by the Company of
payments with respect to Hybrid Preferred
Securities
minus (k) Agreed upon percentage of Net Proceeds
from issuance of hybrid debt/equity
C-1
from issuance of hybrid debt/equity
securities (other than Junior
Subordinated Debt and Hybrid Preferred Securities)
TOTAL $
B. Total Consolidated Capitalization:
(a) Total Consolidated Debt $
plus (b) The sum of Items A(i)
through A(k) above
plus (c) Equity of common stockholders
plus (d) Equity of preference stockholders ____________
plus (e) Equity of preferred stockholders ____________
TOTAL $
C. Debt to Capital Ratio _____ to 1.00
(total of A divided by total of B)
II. Section 8.2 of the Credit Agreement provides that the Company shall:
"Not permit the ratio, determined as of the end of each of its fiscal
quarters for the then most-recently ended four fiscal quarters, of (i)
Consolidated EBIT to (ii) cash Consolidated Interest Expense to be less
than 2.0 to 1.0"
The following calculations are made in accordance with the definitions
of Consolidated EBIT and Consolidated Interest Expense in the Credit Agreement
and are correct and accurate as of _____________, ___:
A. Consolidated EBIT
(a) Consolidated Net Income $
plus (b) Consolidated Interest Expense $
plus (c) Interest and dividends on Hybrid Preferred
Securities and on securities of the type described in Item
A(k) above (but only to the extent securities of the type
described in Item A(k) are deemed equity)
plus (d) Expense for taxes paid or accrued $
D-2
plus (e) Non-cash write-offs and write-downs contained in the $
Company's Consolidated Net Income, including, without
limitation, write-offs or write-downs related to the sale of
assets, impairment of assets and loss on contracts
minus (f) Extraordinary gains realized other than in the $
ordinary course of business
TOTAL $
B. Consolidated Interest Expense $
C. Interest Coverage Ratio _______ to 1.00
(total of A divided by total of B)
IN WITNESS WHEREOF, I have signed this Certificate this ___ day of
_________, ___.
D-3
EXHIBIT D
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption (the "Assignment and Assumption") is
dated as of the Effective Date set forth below and is entered into by and
between [Insert name of Assignor] (the "Assignor") and [Insert name of Assignee]
(the "Assignee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Amended and Restated Credit Agreement identified
below (as amended, the "Credit Agreement"), receipt of a copy of which is hereby
acknowledged by the Assignee. The Terms and Conditions set forth in Annex 1
attached hereto are hereby agreed to and incorporated herein by reference and
made a part of this Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Standard Terms
and Conditions and the Credit Agreement, as of the Effective Date inserted by
the Agent as contemplated below, the interest in and to all of the Assignor's
rights and obligations in its capacity as a Bank under the Credit Agreement and
any other documents or instruments delivered pursuant thereto that represents
the amount and percentage interest identified below of all of the Assignor's
outstanding rights and obligations under the respective facilities identified
below (including without limitation any letters of credit, guaranties and
swingline loans included in such facilities and, to the extent permitted to be
assigned under applicable law, all claims (including without limitation contract
claims, tort claims, malpractice claims, statutory claims and all other claims
at law or in equity), suits, causes of action and any other right of the
Assignor against any Person whether known or unknown arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby) (the
"Assigned Interest"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.
1. Assignor: _____________________________________________________________
2. Assignee: ____________________________________________________________
[and is an affiliate of Assignor]
3. Borrower: CONSUMERS ENERGY COMPANY
4. Agent: Bank One, NA, as the Agent under the Credit Agreement.
5. Credit Agreement: The Credit Agreement dated as of September __, 2003
among Consumers Energy Company, the Banks party thereto, and Bank One, NA, as
Agent.
D-1
6. Assigned Interest:
Aggregate Amount of
Commitment/
Outstanding Credit Amount of Commitment/ Percentage Assigned of
Exposure for all Outstanding Credit Exposure Commitment/ Outstanding Credit
Facility Assigned Banks* Assigned* Exposure(1)
------------------------------------------------------------------------------------------------------------
____________ $ $ __________%
------------------------------------------------------------------------------------------------------------
____________ $ $ __________%
------------------------------------------------------------------------------------------------------------
____________ $ $ __________%
------------------------------------------------------------------------------------------------------------
7. Trade Date: _______________________________________________________(2)
Effective Date: ____________________, 20__ TO BE INSERTED BY AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE AGENT.]
--------------------------------
* Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.
(1) Set forth, to at least 9 decimals, as a percentage of the
Commitment/Loans of all Banks thereunder.
(2) Insert if satisfaction of minimum amounts is to be determined as of the
Trade Date.
D-2
The terms set forth in this Assignment and Assumption are hereby agreed
to:
ASSIGNOR
[NAME OF ASSIGNOR]
By: ________________________________
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By: _______________________________
Title:
[Consented to and](3) Accepted:
BANK ONE, NA, as Agent
By: __________________________________
Title:
[Consented to:](4)
[NAME OF RELEVANT PARTY]
By: __________________________________
Title:
-------------------------------
(3) To be added only if the consent of the Agent is required by the terms
of the Credit Agreement.
(4) To be added only if the consent of the Company and/or other parties
(e.g. LC Issuer) is required by the terms of the Credit Agreement.
D-3
ANNEX 1
TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor represents and warrants that (i) it
is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned
Interest is free and clear of any lien, encumbrance or other adverse claim and
(iii) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby. Neither the Assignor nor any of its officers,
directors, employees, agents or attorneys shall be responsible for (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Credit Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency, perfection, priority,
collectibility, or value of the Credit Documents or any collateral thereunder,
(iii) the financial condition of the Company, any of its Subsidiaries or
Affiliates or any other Person obligated in respect of any Credit Document, (iv)
the performance or observance by the Company, any of its Subsidiaries or
Affiliates or any other Person of any of their respective obligations under any
Credit Document, (v) inspecting any of the property, books or records of the
Company, or any guarantor, or (vi) any mistake, error of judgment, or action
taken or omitted to be taken in connection with the Credit Extensions or the
Credit Documents.
1.2. Assignee. The Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment and Assumption and to consummate the
transactions contemplated hereby and to become a Bank under the Credit
Agreement, (ii) from and after the Effective Date, it shall be bound by the
provisions of the Credit Agreement as a Bank thereunder and, to the extent of
the Assigned Interest, shall have the obligations of a Bank thereunder, (iii)
agrees that its payment instructions and notice instructions are as set forth in
Schedule 1 to this Assignment and Assumption, (iv) confirms that none of the
funds, monies, assets or other consideration being used to make the purchase and
assumption hereunder are "plan assets" as defined under ERISA and that its
rights, benefits and interests in and under the Credit Documents will not be
"plan assets" under ERISA, (v) agrees to indemnify and hold the Assignor
harmless against all losses, costs and expenses (including, without limitation,
reasonable attorneys' fees) and liabilities incurred by the Assignor in
connection with or arising in any manner from the Assignee's non-performance of
the obligations assumed under this Assignment and Assumption, (vi) it has
received a copy of the Credit Agreement, together with copies of financial
statements and such other documents and information as it has deemed appropriate
to make its own credit analysis and decision to enter into this Assignment and
Assumption and to purchase the Assigned Interest on the basis of which it has
made such analysis and decision independently and without reliance on the Agent
or any other Bank, and (vii) attached as Schedule 1 to this Assignment and
Assumption is any documentation required to be delivered by the Assignee with
respect to its tax status pursuant to the terms of the Credit Agreement, duly
completed and executed by the Assignee and (b) agrees that (i) it will,
independently and without reliance on the Agent, the Assignor or any other Bank,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Credit Documents, and
Annex 1
(ii) it will perform in accordance with their terms all of the obligations which
by the terms of the Credit Documents are required to be performed by it as a
Bank.
2. Payments. The Assignee shall pay the Assignor, on the
Effective Date, the amount agreed to by the Assignor and the Assignee. From and
after the Effective Date, the Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, Reimbursement
Obligations, fees and other amounts) to the Assignor for amounts which have
accrued to but excluding the Effective Date and to the Assignee for amounts
which have accrued from and after the Effective Date.
3. General Provisions. This Assignment and Assumption shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns. This Assignment and Assumption may be
executed in any number of counterparts, which together shall constitute one
instrument. Delivery of an executed counterpart of a signature page of this
Assignment and Assumption by telecopy shall be effective as delivery of a
manually executed counterpart of this Assignment and Assumption. This Assignment
and Assumption shall be governed by, and construed in accordance with, the law
of the State of New York.
Annex 1
ADMINISTRATIVE QUESTIONNAIRE
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
(For Forms for Primary Syndication call ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ at 312-732-8844)
(For Forms after Primary Syndication call ▇▇▇ ▇▇▇▇▇ at ▇▇▇-▇▇▇-▇▇▇▇)
US AND NON-US TAX INFORMATION REPORTING REQUIREMENTS
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
(For Forms for Primary Syndication call ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ at 312-732-8844)
(For Forms after Primary Syndication call ▇▇▇ ▇▇▇▇▇ at ▇▇▇-▇▇▇-▇▇▇▇)
EXHIBIT E
TERMS OF SUBORDINATION
[JUNIOR SUBORDINATED DEBT]
ARTICLE ____
SUBORDINATION
Section ___.1 Applicability of Article; Securities Subordinated to
Senior Indebtedness.
(a) This Article ____ shall apply only to the Securities of any
series which, pursuant to Section ___, are expressly made subject to this
Article. Such Securities are referred to in this Article ____ as "Subordinated
Securities."
(b) The Issuer covenants and agrees, and each Holder of
Subordinated Securities by his acceptance thereof likewise covenants and agrees,
that the indebtedness represented by the Subordinated Securities and the payment
of the principal and interest, if any, on the Subordinated Securities is
subordinated and subject in right, to the extent and in the manner provided in
this Article, to the prior payment in full of all Senior Indebtedness.
"Senior Indebtedness" means the principal of and premium, if any, and
interest on the following, whether outstanding on the date hereof or thereafter
incurred, created or assumed: (i) indebtedness of the Issuer for money borrowed
by the Issuer (including purchase money obligations) or evidenced by debentures
(other than the Subordinated Securities), notes, bankers' acceptances or other
corporate debt securities, or similar instruments issued by the Issuer; (ii) all
capital lease obligations of the Issuer; (iii) all obligations of the Issuer
issued or assumed as the deferred purchase price of property, all conditional
sale obligations of the Issuer and all obligations of the Issuer under any title
retention agreement (but excluding trade accounts payable arising in the
ordinary course of business); (iv) obligations with respect to letters of
credit; (v) all indebtedness of others of the type referred to in the preceding
clauses (i) through (iv) assumed by or guaranteed in any manner by the Issuer or
in effect guaranteed by the Issuer; (vi) all obligations of the type referred to
in clauses (i) through (v) above of other persons secured by any lien on any
property or asset of the Issuer (whether or not such obligation is assumed by
the Issuer), except for (1) any such indebtedness that is by its terms
subordinated to or pari passu with the Subordinated Notes, as the case may be,
including all other debt securities and guaranties in respect of those debt
securities, issued to any other trusts, partnerships or other entities
affiliated with the Issuer which act as a financing vehicle of the Issuer in
connection with the issuance of preferred securities by such entity or other
securities which rank pari passu with, or junior to, the Preferred Securities,
and (2) any indebtedness between or among the Issuer and its affiliates; and/or
(vii) renewals, extensions or refundings of any of the indebtedness referred to
in the preceding clauses unless, in the case of any particular indebtedness,
renewal, extension or refunding, under the express provisions of the instrument
creating or evidencing the same or the assumption or guarantee of the same, or
pursuant to which the same is outstanding, such
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indebtedness or such renewal, extension or refunding thereof is not superior in
right of payment to the Subordinated Securities.
This Article shall constitute a continuing obligation to all Persons
who, in reliance upon such provisions become holders of, or continue to hold,
Senior Indebtedness, and such provisions are made for the benefit of the holders
of Senior Indebtedness, and such holders are made obligees hereunder and they
and/or each of them may enforce such provisions.
Section ___.2 Issuer Not to Make Payments with Respect to Subordinated
Securities in Certain Circumstances.
(a) Upon the maturity of any Senior Indebtedness by lapse of time,
acceleration or otherwise, all principal thereof and premium and interest
thereon shall first be paid in full, or such payment duly provided for in cash
in a manner satisfactory to the holders of such Senior Indebtedness, before any
payment is made on account of the principal of, or interest on, Subordinated
Securities or to acquire any Subordinated Securities or on account of any
sinking fund provisions of any Subordinated Securities (except payments made in
capital stock of the Issuer or in warrants, rights or options to purchase or
acquire capital stock of the Issuer, sinking fund payments made in Subordinated
Securities acquired by the Issuer before the maturity of such Senior
Indebtedness, and payments made through the exchange of other debt obligations
of the Issuer for such Subordinated Securities in accordance with the terms of
such Subordinated Securities, provided that such debt obligations are
subordinated to Senior Indebtedness at least to the extent that the Subordinated
Securities for which they are exchanged are so subordinated pursuant to this
Article ____).
(b) Upon the happening and during the continuation of any default
in payment of the principal of, or interest on, any Senior Indebtedness when the
same becomes due and payable or in the event any judicial proceeding shall be
pending with respect to any such default, then, unless and until such default
shall have been cured or waived or shall have ceased to exist, no payment shall
be made by the Issuer with respect to the principal of, or interest on,
Subordinated Securities or to acquire any Subordinated Securities or on account
of any sinking fund provisions of Subordinated Securities (except payments made
in capital stock of the Issuer or in warrants, rights, or options to purchase or
acquire capital stock of the Issuer, sinking fund payments made in Subordinated
Securities acquired by the Issuer before such default and notice thereof, and
payments made through the exchange of other debt obligations of the Issuer for
such Subordinated Securities in accordance with the terms of such Subordinated
Securities, provided that such debt obligations are subordinated to Senior
Indebtedness at least to the extent that the Subordinated Securities for which
they are exchanged are so subordinated pursuant to this Article ____).
(c) In the event that, notwithstanding the provisions of this
Section ___.2, the Issuer shall make any payment to the Trustee on account of
the principal of or interest on Subordinated Securities, or on account of any
sinking fund provisions of such Securities, after the maturity of any Senior
Indebtedness as described in Section ___.2(a) above or after the happening of a
default in payment of the principal of or interest on any Senior Indebtedness as
described in Section ___.2(b) above, then, unless and until all Senior
Indebtedness which shall have matured,
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and all premium and interest thereon, shall have been paid in full (or the
declaration of acceleration thereof shall have been rescinded or annulled), or
such default shall have been cured or waived or shall have ceased to exist, such
payment (subject to the provisions of Sections ___.6 and ___.7) shall be held by
the Trustee, in trust for the benefit of, and shall be paid forthwith over and
delivered to, the holders of such Senior Indebtedness (pro rata as to each of
such holders on the basis of the respective amounts of Senior Indebtedness held
by them) or their representative or the trustee under the indenture or other
agreement (if any) pursuant to which such Senior Indebtedness may have been
issued, as their respective interests may appear, for application to the payment
of all such Senior Indebtedness remaining unpaid to the extent necessary to pay
the same in full in accordance with its terms, after giving effect to any
concurrent payment or distribution to or for the holders of Senior Indebtedness.
The Issuer shall give prompt written notice to the Trustee of any default in the
payment of principal of or interest on any Senior Indebtedness.
Section ___.3 Subordinated Securities Subordinated to Prior Payment of
All Senior Indebtedness on Dissolution, Liquidation or Reorganization of Issuer.
Upon any distribution of assets of the Issuer in any dissolution, winding up,
liquidation or reorganization of the Issuer (whether voluntary or involuntary,
in bankruptcy, insolvency or receivership proceedings or upon an assignment for
the benefit of creditors or otherwise):
(a) the holders of all Senior Indebtedness shall first be entitled
to receive payments in full of the principal thereof and premium and interest
due thereon, or provision shall be made for such payment, before the Holders of
Subordinated Securities are entitled to receive any payment on account of the
principal of or interest on such Securities;
(b) any payment or distribution of assets of the Issuer of any
kind or character, whether in cash, property or securities (other than
securities of the Issuer as reorganized or readjusted or securities of the
Issuer or any other corporation provided for by a plan of reorganization or
readjustment the payment of which is subordinate, at least to the extent
provided in this Article ____ with respect to Subordinated Securities, to the
payment in full without diminution or modification by such plan of all Senior
Indebtedness), to which the Holders of Subordinated Securities or the Trustee on
behalf of the Holders of Subordinated Securities would be entitled except for
the provisions of this Article ____ shall be paid or delivered by the
liquidating trustee or agent or other person making such payment or distribution
directly to the holders of Senior Indebtedness or their representative, or to
the trustee under any indenture under which Senior Indebtedness may have been
issued (pro rata as to each such holder, representative or trustee on the basis
of the respective amounts of unpaid Senior Indebtedness held or represented by
each), to the extent necessary to make payment in full of all Senior
Indebtedness remaining unpaid, after giving effect to any concurrent payment or
distribution or provision thereof to the holders of such Senior Indebtedness;
and
(c) in the event that notwithstanding the foregoing provisions of
this Section ___.3, any payment or distribution of assets of the Issuer of any
kind or character, whether in cash, property or securities (other than
securities of the Issuer as reorganized or readjusted or securities of the
Issuer or any other corporation provided for by a plan of reorganization or
readjustment the payment of which is subordinate, at least to the extent
provided in this Article ____ with
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respect to Subordinated Securities, to the payment in full without diminution or
modification by such plan of all Senior Indebtedness), shall be received by the
Trustee or the Holders of the Subordinated Securities on account of principal of
or interest on the Subordinated Securities before all Senior Indebtedness is
paid in full, or effective provision made for its payment, such payment or
distribution (subject to the provisions of Section ___.6 and ___.7) shall be
received and held in trust for and shall be paid over to the holders of the
Senior Indebtedness remaining unpaid or unprovided for or their representative,
or to the trustee under any indenture under which such Senior Indebtedness may
have been issued (pro rata as provided in subsection (b) above), for application
to the payment of such Senior Indebtedness until all such Senior Indebtedness
shall have been paid in full, after giving effect to any concurrent payment or
distribution or provision therefor to the holders of such Senior Indebtedness.
The Issuer shall give prompt written notice to the Trustee of any
dissolution, winding up, liquidation or reorganization of the Issuer.
The consolidation of the Issuer with, or the merger of the Issuer into,
another corporation or the liquidation or dissolution of the Issuer following
the conveyance or transfer of its property as an entirety, or substantially as
an entirety, to another corporation upon the terms and conditions provided for
in Article ____ hereof shall not be deemed a dissolution, winding up,
liquidation or reorganization for the purposes of this Section ___.3 if such
other corporation shall, as a part of such consolidation, merger, conveyance or
transfer, comply with the conditions stated such in Article ____.
Section ___.4 Holders of Subordinated Securities to be Subrogated to
Right of Holders of Senior Indebtedness. Subject to the payment in full of all
Senior Indebtedness, the Holders of Subordinated Securities shall be subrogated
to the rights of the holders of Senior Indebtedness to receive payments or
distributions of assets of the Issuer applicable to the Senior Indebtedness
until all amounts owing on Subordinated Securities shall be paid in full, and
for the purposes of such subrogation no payments or distributions to the holders
of the Senior Indebtedness by or on behalf of the Issuer or by or on behalf of
the Holders of Subordinated Securities by virtue of this Article ____ which
otherwise would have been made to the Holders of Subordinated Securities shall,
as between the Issuer, its creditors other than holders of Senior Indebtedness
and the Holders of Subordinated Securities, be deemed to be payment by the
Issuer to or on account of the Senior Indebtedness, it being understood that the
provisions of this Article ____ are and are intended solely for the purpose of
defining the relative rights of the Holders of the Subordinated Securities, on
the one hand, and the holders of the Senior Indebtedness, on the other hand.
Section ___.5 Obligation of the Issuer Unconditional. Nothing contained
in this Article ____ or elsewhere in this Indenture or in any Subordinated
Security is intended to or shall impair, as among the Issuer, its creditors
other than holders of Senior Indebtedness and the Holders of Subordinated
Securities, the obligation of the Issuer, which is absolute and unconditional,
to pay to the Holders of Subordinated Securities the principal of, and interest
on, Subordinated Securities as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders of Subordinated Securities and creditors of the Issuer
other than the holders of the Senior Indebtedness, nor shall anything herein or
therein prevent the Trustee or the Holder of any Subordinated Security from
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exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Article ____ of the
holders of Senior Indebtedness in respect of cash, property or securities of the
Issuer received upon the exercise of any such remedy. Upon any payment or
distribution of assets of the Issuer referred to in this Article ____, the
Trustee and Holders of Subordinated Securities shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction in which such
dissolution, winding up, liquidation or reorganization proceedings are pending,
or, subject to the provisions of Section ___ and ___, a certificate of the
receiver, trustee in bankruptcy, liquidating trustee or agent or other Person
making such payment or distribution to the Trustee or the Holders of
Subordinated Securities, for the purposes of ascertaining the Persons entitled
to participate in such distribution, the holders of the Senior Indebtedness and
other indebtedness of the Issuer, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article ____.
Nothing contained in this Article ____ or elsewhere in this Indenture
or in any Subordinated Security is intended to or shall affect the obligation of
the Issuer to make, or prevent the Issuer from making, at any time except during
the pendency of any dissolution, winding up, liquidation or reorganization
proceeding, and, except as provided in subsections (a) and (b) of Section ___.2,
payments at any time of the principal of, or interest on, Subordinated
Securities.
Section ___.6 Trustee Entitled to Assume Payments Not Prohibited in
Absence of Notice. The Issuer shall give prompt written notice to the Trustee of
any fact known to the Issuer which would prohibit the making of any payment or
distribution to or by the Trustee in respect of the Subordinated Securities.
Notwithstanding the provisions of this Article ____ or any provision of this
Indenture, the Trustee shall not at any time be charged with knowledge of the
existence of any facts which would prohibit the making of any payment or
distribution to or by the Trustee, unless at least two Business Days prior to
the making of any such payment, the Trustee shall have received written notice
thereof from the Issuer or from one or more holders of Senior Indebtedness or
from any representative thereof or from any trustee therefor, together with
proof satisfactory to the Trustee of such holding of Senior Indebtedness or of
the authority of such representative or trustee; and, prior to the receipt of
any such written notice, the Trustee, subject to the provisions of Sections ___
and ___, shall be entitled to assume conclusively that no such facts exist. The
Trustee shall be entitled to rely on the delivery to it of a written notice by a
Person representing himself to be a holder of Senior Indebtedness (or a
representative or trustee on behalf of the holder) to establish that such notice
has been given by a holder of Senior Indebtedness (or a representative of or
trustee on behalf of any such holder). In the event that the Trustee determines,
in good faith, that further evidence is required with respect to the right of
any Person as a holder of Senior Indebtedness to participate in any payments or
distribution pursuant of this Article ____, the Trustee may request such Person
to furnish evidence to the reasonable satisfaction of the Trustee as to the
amount of Senior Indebtedness held by such Person, as to the extent to which
such Person is entitled to participate in such payment or distribution, and as
to other facts pertinent to the rights of such Person under this Article ____,
and if such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment. The Trustee, however, shall not be deemed to owe any fiduciary
duty to the holders of Senior Indebtedness
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and nothing in this Article ____ shall apply to claims of, or payments to, the
Trustee under or pursuant to Section ___.
Section ___.7 Application by Trustee of Monies or Government
Obligations Deposited with It. Money or Government Obligations deposited in
trust with the Trustee pursuant to and in accordance with Section ____ shall be
for the sole benefit of Securityholders and, to the extent allocated for the
payment of Subordinated Securities, shall not be subject to the subordination
provisions of this Article ____, if the same are deposited in trust prior to the
happening of any event specified in Section ___.2. Otherwise, any deposit of
monies or Government Obligations by the Issuer with the Trustee or any paying
agent (whether or not in trust) for the payment of the principal of, or interest
on, any Subordinated Securities shall be subject to the provisions of Section
___.1, ___.2 and ___.3 except that, if prior to the date on which by the terms
of this Indenture any such monies may become payable for any purposes
(including, without limitation, the payment of the principal of, or the
interest, if any, on any Subordinated Security) the Trustee shall not have
received with respect to such monies the notice provided for in Section ___.6,
then the Trustee or the paying agent shall have full power and authority to
receive such monies and Government Obligations and to apply the same to the
purpose for which they were received, and shall not be affected by any notice to
the contrary which may be received by it on or after such date. This Section
___.7 shall be construed solely for the benefit of the Trustee and paying agent
and, as to the first sentence hereof, the Securityholders, and shall not
otherwise effect the rights of holders of Senior Indebtedness.
Section ___.8 Subordination Rights Not Impaired by Acts or Omissions of
Issuer or Holders of Senior Indebtedness. No rights of any present or future
holders of any Senior Indebtedness to enforce subordination as provided herein
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Issuer or by any act or failure to act, in good faith, by
any such holders or by any noncompliance by the Issuer with the terms of this
Indenture, regardless of any knowledge thereof which any such holder may have or
be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness of the Issuer may, at any time and from time
to time, without the consent of or notice to the Trustee or the Holders of the
Subordinated Securities, without incurring responsibility to the Holders of the
Subordinated Securities and without impairing or releasing the subordination
provided in this Article ____ or the obligations hereunder of the Holders of the
Subordinated Securities to the holders of such Senior Indebtedness, do any one
or more of the following: (i) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, such Senior Indebtedness, or
otherwise amend or supplement in any manner such Senior Indebtedness or any
instrument evidencing the same or any agreement under which such Senior
Indebtedness is outstanding; (ii) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing such Senior Indebtedness;
(iii) release any Person liable in any manner for the collection for such Senior
Indebtedness; and (iv) exercise or refrain from exercising any rights against
the Issuer, as the case may be, and any other Person.
Section ___.9 Securityholders Authorize Trustee to Effectuate
Subordination of Securities. Each Holder of Subordinated Securities by his
acceptance thereof authorizes and
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expressly directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article ____ and appoints the Trustee his attorney-in-fact for such purpose,
including in the event of any dissolution, winding up, liquidation or
reorganization of the Issuer (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or otherwise) the
immediate filing of a claim for the unpaid balance of his Subordinated
Securities in the form required in said proceedings and causing said claim to be
approved. If the Trustee does not file a proper claim or proof of debt in the
form required in such proceeding prior to 30 days before the expiration of the
time to file such claim or claims, then the holders of Senior Indebtedness have
the right to file and are hereby authorized to file an appropriate claim for and
on behalf of the Holders of said Securities.
Section ___.10 Right of Trustee to Hold Senior Indebtedness. The
Trustee in its individual capacity shall be entitled to all of the rights set
forth in this Article ____ in respect of any Senior Indebtedness at any time
held by it to the same extent as any other holder of Senior Indebtedness, and
nothing in this Indenture shall be construed to deprive the Trustee of any of
its rights as such holder.
With respect to the holders of Senior Indebtedness of the Issuer, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article ____, and no implied
covenants or obligations with respect to the holders of such Senior Indebtedness
shall be read into this Indenture against the Trustee. The Trustee shall not be
deemed to owe any fiduciary duty to the holders of such Senior Indebtedness and,
subject to the provisions of Sections ___.2 and ___.3, the Trustee shall not be
liable to any holder of such Senior Indebtedness if it shall pay over or deliver
to Holders of Subordinated Securities, the Issuer or any other Person money or
assets to which any holder of such Senior Indebtedness shall be entitled by
virtue of this Article ____ or otherwise.
Section ___.11 Article ____ Not to Prevent Events of Defaults. The
failure to make a payment on account of principal or interest by reason of any
provision in this Article ____ shall not be construed as preventing the
occurrence of an Event of Default under Section ____.
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EXHIBIT F
TERMS OF SUBORDINATION
[GUARANTY OF HYBRID PREFERRED SECURITIES]
SECTION ___. This Guarantee will constitute an unsecured obligation of
the Guarantor and will rank subordinate and junior in right of payment to all
other liabilities of the Guarantor and pari passu with any guarantee now or
hereafter entered into by the Guarantor in respect of the securities
representing common beneficial interests in the assets of the Issuer or of any
preferred or preference stock of any affiliate of the Guarantor.
F-1
EXHIBIT G
FORM OF BOND DELIVERY AGREEMENT
BOND DELIVERY AGREEMENT
CONSUMERS ENERGY COMPANY
TO
BANK ONE, NA, AS AGENT
Dated as of September __, 2003
____________________________
Relating to
First Mortgage Bonds,
2003-1 Collateral Series (Interest Bearing)
____________________________
G-1
THIS BOND DELIVERY AGREEMENT (this "Agreement"), dated as of September
__, 2003, is between Consumers Energy Company (the "Company"), and Bank One, NA,
as agent (the "Agent") under the Amended and Restated Credit Agreement (as
amended, supplemented or otherwise modified from time to time, the "Credit
Agreement") dated as of September __, 2003, among the Company, the financial
institutions parties thereto (the "Banks"), and the Agent. Capitalized terms
used but not otherwise defined herein have the respective meanings assigned to
such terms in the Credit Agreement.
Whereas, the Company has entered into the Credit Agreement and may from
time to time make borrowings thereunder in accordance with the provisions
thereof;
Whereas, the Company has established its First Mortgage Bonds, 2003-1
Collateral Series (Interest Bearing) in the aggregate principal amount of
$400,000,000 (the "Bonds"), to be issued under and in accordance with the
Ninety-Third Supplemental Indenture dated as of September __, 2003 (the
"Supplemental Indenture"), to the Indenture of the Company to JPMorgan Chase
Bank (formerly known as The Chase Manhattan Bank) dated as of September 1, 1945
(as amended and supplemented, the "Indenture"); and
Whereas, the Company proposes to issue and deliver to the Agent, for
the benefit of the Banks, the Bonds in order to provide the Bonds as evidence of
(and the benefit of the lien of the Indenture with respect to the Bonds for) the
Obligations of the Company arising under the Credit Agreement.
Now, therefore, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the Company and the Agent hereby agree as follows:
ARTICLE I
THE BONDS
Section 1.1 Delivery of Bonds.
In order to provide the Bonds as evidence of (and through the Bonds the
benefit of the Lien of the Indenture for) the Obligations of the Company under
the Credit Agreement as aforesaid, the Company hereby delivers to the Agent the
Bonds in the aggregate principal amount of $400,000,000, maturing on September
__, 2004 or such later date as may be fixed as the "Termination Date" under and
as defined in the Credit Agreement and bearing interest as provided in the
Supplemental Indenture. The obligation of the Company to pay the principal of
and interest on the Bonds shall be deemed to have been satisfied and discharged
in full or in part, as the case may be, to the extent of payment by the Company
of the Obligations, all as set forth in the Bonds and in Section 1 of the
Supplemental Indenture.
The Bonds are registered in the name of the Agent and shall be owned
and held by the Agent, subject to the provisions of this Agreement, for the
benefit of the Banks, and the Company shall have no interest therein. The Agent
shall be entitled to exercise all rights of bondholders under the Indenture with
respect to the Bonds.
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The Agent hereby acknowledges receipt of the Bonds.
Section 1.2 Payments on the Bonds.
Any payments received by the Agent on account of the principal of or
interest on the Bonds shall be deemed to be and treated in all respects as
payments of the Obligations, and such payments shall be distributed by the Agent
to the Banks in accordance with the provisions of the Credit Agreement
applicable to payments received by the Agent in respect of the Obligations (and
the Company hereby consents to such distributions).
ARTICLE II
NO TRANSFER OF BONDS; SURRENDER OF BONDS
Section 2.1 No Transfer of the Bonds.
The Agent shall not sell, assign or otherwise transfer any Bonds
delivered to it under this Agreement except to a successor administrative agent
under the Credit Agreement. The Company may take such actions as it shall deem
necessary, desirable or appropriate to effect compliance with such restrictions
on transfer, including the issuance of stop-transfer instructions to the trustee
under the Indenture or any other transfer agent thereunder.
Section 2.2 Surrender of Bonds.
(a) The Agent shall forthwith surrender to or upon the order of
the Company all Bonds held by it at the first time at which the Commitments
shall have been terminated and all Obligations shall have been paid in full.
(b) Upon any permanent reduction in the Aggregate Commitment
pursuant to the terms of the Credit Agreement, the Agent shall forthwith
surrender to or upon the order of the Company Bonds in an aggregate principal
amount equal to the excess of the aggregate principal amount of Bonds held by
the Agent over the Aggregate Commitment.
ARTICLE III
GOVERNING LAW
This Agreement shall construed in accordance with and governed by the
internal laws (without regard to the conflict of laws provisions) of the State
of New York, but giving effect to Federal laws applicable to national banks.
[SIGNATURE PAGE FOLLOWS]
G-3
IN WITNESS WHEREOF, the Company and the Agent have caused this
Agreement to be executed and delivered as of the date first above written.
CONSUMERS ENERGY COMPANY
____________________________________________
Name:
Title:
BANK ONE, NA, as Agent
____________________________________________
Name:
Title:
G-4
PRICING SCHEDULE
The Applicable Margin shall be determined pursuant to the table below
based on the lower of the S&P Rating and the ▇▇▇▇▇'▇ Rating.
S&P Rating
S&P Rating of S&P Rating of S&P Rating of S&P Rating of S&P Rating of lower than BB
BBB+ or BBB or BBB- or BB+ or BB or or Moody's
Moody's Moody's Moody's Moody's ▇▇▇▇▇'▇ Rating lower
Ratings Rating of Baa1 Rating of Baa2 Rating of Baa3 Rating of Ba1 Rating of Ba2 than Ba2
-----------------------------------------------------------------------------------------------------------------------
Commitment Fee Rate .20% .25% .30% .35% .50% .50%
-----------------------------------------------------------------------------------------------------------------------
Eurodollar Rate + 1.250% 1.500% 1.750% 2.125% 2.500% 3.000%
-----------------------------------------------------------------------------------------------------------------------
Alternate Base Rate + .250% .500% .750% 1.125% 1.500% 2.000%
-----------------------------------------------------------------------------------------------------------------------
For purposes of the forgoing table:
"▇▇▇▇▇'▇ Rating" means, at any time, the rating issued by Moody's and
then in effect with respect to the Senior Debt.
"S&P Rating" means, at any time, the rating issued by S&P and then in
effect with respect to the Senior Debt.
COMMITMENT SCHEDULE
BANK COMMITMENT
------------------------------------ -------------
Bank One, NA $ 42,000,000
Barclays Bank PLC $ 42,000,000
JPMorgan Chase Bank $ 39,000,000
Citicorp North America, Inc. $ 39,000,000
Union Bank of California, N.A. $ 39,000,000
Wachovia Bank, National Association $ 39,000,000
Deutsche Bank Trust Company Americas $ 30,000,000
BNP Paribas $ 30,000,000
Standard Federal Bank N.A. $ 25,000,000
Huntington National Bank $ 25,000,000
HSH Nordbank AG, New York Branch $ 20,000,000
Comerica Bank $ 15,000,000
The Fifth Third Bank $ 15,000,000
AGGREGATE COMMITMENT $ 400,000,000