EXHIBIT 10(k)
EXECUTION VERSION
 
AGREEMENT OF PURCHASE AND SALE
by and between
CMS ENTERPRISES COMPANY,
as Seller
and
ABU DHABI NATIONAL ENERGY COMPANY PJSC,
as Buyer
dated as of
February 3, 2007
 

 

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TABLE OF CONTENTS

              Page
ARTICLE I DEFINITIONS; INTERPRETATIONS
         
Section 1.1 Specific Definitions
    2  
Section 1.2 Interpretation
    11  
 
       
ARTICLE II SALE AND PURCHASE
         
Section 2.1 Agreement to Sell and Purchase
    12  
Section 2.2 Time and Place of Closing
    12  
 
       
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER
         
Section 3.1 Corporate Organization; Qualification
    14  
Section 3.2 Authority Relative to this Agreement
    14  
Section 3.3 Generation Interests
    15  
Section 3.4 Consents and Approvals
    18  
Section 3.5 No Conflict or Violation
    18  
Section 3.6 Contracts
    18  
Section 3.7 Compliance with Law
    19  
Section 3.8 Permits
    20  
Section 3.9 Litigation
    20  
Section 3.10 Employee Matters
    20  
Section 3.11 Labor Relations
    21  
Section 3.12 Intellectual Property
    22  
Section 3.13 Environmental Matters
    23  
Section 3.14 Tax Matters
    24  
Section 3.15 Insurance
    25  
Section 3.16 Regulatory Matters
    26  
Section 3.17 Financial Statements
    26  
Section 3.18 Absence of Certain Changes or Events
    28  
Section 3.19 Absence of Undisclosed Liabilities
    28  
Section 3.20 Brokerage and Finders’ Fees
    28  
Section 3.21 Affiliated Transactions
    29  

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              Page
Section 3.22 No Insolvency
    29  
Section 3.23 No Other Representations or Warranties
    29  
 
       
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER
         
Section 4.1 Corporate Organization; Qualification
    30  
Section 4.2 Authority Relative to this Agreement
    30  
Section 4.3 Consents and Approvals
    31  
Section 4.4 No Conflict or Violation
    31  
Section 4.5 Litigation
    31  
Section 4.6 Availability of Funds
    32  
Section 4.7 Brokerage and Finders’ Fees
    32  
Section 4.8 Investment Representations
    32  
Section 4.9 Regulation Matters
    33  
Section 4.10 No Other Representations or Warranties
    33  
 
       
ARTICLE V COVENANTS OF THE PARTIES
         
Section 5.1 Conduct of Business
    33  
Section 5.2 Access to Properties and Records
    37  
Section 5.3 Consents and Approvals
    37  
Section 5.4 Certain Subsidiary Level Debt
    39  
Section 5.5 Further Assurances
    40  
Section 5.6 Employee Matters
    40  
Section 5.7 Tax Covenants
    41  
Section 5.8 Intercompany Accounts
    49  
Section 5.9 Maintenance of Insurance Policies
    49  
Section 5.10 Preservation of Records
    50  
Section 5.11 Public Statements
    51  
Section 5.12 Certain Transactions
    51  
Section 5.13 Use of Corporate Name; Transitional Use of Seller’s Name
    52  
Section 5.14 Release of Guarantees
    53  
Section 5.15 Reorganization
    53  
Section 5.16 Merger and Redomiciliation
    53  
Section 5.17 CGIC Loan Agreement
    54  
Section 5.18 Assignment of Contracts
    54  

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              Page
Section 5.19 Financial Statements
    54  
 
       
ARTICLE VI CONDITIONS
         
Section 6.1 Mutual Conditions to the Closing
    54  
Section 6.2 Buyer’s Conditions to the Closing
    55  
Section 6.3 Seller’s Conditions to the Closing
    55  
 
       
ARTICLE VII TERMINATION AND ABANDONMENT
         
Section 7.1 Termination
    56  
Section 7.2 Procedure and Effect of Termination
    57  
 
       
ARTICLE VIII SURVIVAL; INDEMNIFICATION
         
Section 8.1 Survival
    57  
Section 8.2 Indemnification
    58  
Section 8.3 Calculation of Damages
    61  
Section 8.4 Procedures for Third-Party Claims
    62  
Section 8.5 Procedures for Inter-Party Claims
    62  
Section 8.6 Additional Procedures for Claims Made Pursuant to Section 8.2(a)(v)
    63  
 
       
ARTICLE IX MISCELLANEOUS PROVISIONS
         
Section 9.1 Disclosure Letters
    63  
Section 9.2 Payments
    63  
Section 9.3 Expenses
    63  
Section 9.4 Choice of Law
    64  
Section 9.5 Assignment
    64  
Section 9.6 Notices
    64  
Section 9.7 Resolution of Disputes
    65  
Section 9.8 Language
    66  
Section 9.9 No Right of Setoff
    66  
Section 9.10 Time is of the Essence
    67  
Section 9.11 Limitation on Liability
    67  
Section 9.12 Entire Agreement
    67  
Section 9.13 Binding Nature; Third Party Beneficiaries
    67  
Section 9.14 Counterparts
    67  
Section 9.15 Severability
    67  

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              Page
Section 9.16 Headings
    67  
Section 9.17 Waiver
    68  
Section 9.18 Amendment
    68  

EXHIBITS

     
A
  Buyer Access and Support Agreement
B
  License Agreement
C
  Transition Services Agreement
D
  CGIC Term Sheet
E
  Seller’s Certificate
F
  Buyer’s Certificate
G
  JLEC Term Sheet
H
  Seller Access and Support Agreement

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INDEX OF DEFINED TERMS

         
2006 Financial Statements
    56  
Action
    2  
Affiliate
    2  
Agreement
    1  
Applicable Law
    2  
Article
    12  
Business Day
    2  
Business Materials
    55  
Buyer
    1  
Buyer Access and Support Agreement
    2  
Buyer Disclosure Letter
    31  
Buyer Indemnified Parties
    61  
Cap Amount
    62  
Casualty Insurance Claims
    51  
CGIC Loan Agreement
    2  
Claims
    3  
Closing
    13  
Closing Date
    13  
Closing Deductible Amount
    62  
Closing Payment
    13  
CMS
    54  
CMS Generation Co
    54  
Code
    3  
Competition Laws
    3  
Confidentiality Agreement
    3  
Consent and Support Agreement
    1  
Consolidated Income Tax Return
    46  
Contract
    3  
Damages
    3  
Deposit
    13  
Dispute
    69  
Distribution
    3  
Elections
    43  
Employees
    21  
Energy
    1  
Energy Guarantee
    1  
Environmental Laws
    3  
Environmental Permit
    4  
ERISA
    4  
Exchange Act
    4  
Exhibit
    12  
FERC
    4  
Final Forms 8883
    43  
FPA
    4  

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GAAP
    4  
Generation
    1  
Generation Interests
    1  
Generation Non-U.S. Subsidiary
    4  
Generation Shares
    16  
Generation Subsidiaries
    4  
Generation U.S. Subsidiary
    4  
Governmental Authority
    5  
Guarantees
    55  
Hazardous Substances
    5  
ICAICC
    45  
Indebtedness
    5  
Indemnified Party
    62  
Indemnifying Party
    62  
Indemnity Period
    60  
Initial Deductible Amount
    62  
Insurance Policies
    52  
Intellectual Property
    5  
JLE Financial Statements
    29  
JLEC Refinancing
    41  
JLH Financial Statements
    28  
JLPE Financial Statements
    29  
Jorf
    6  
Jorf Common Agreement
    3  
Jorf Financial Statements
    27  
Jorf Project
    6  
Jubail
    6  
Jubail Financial Statements
    27  
Jubail Project
    6  
Knowledge of Buyer
    6  
Knowledge of Seller
    6  
Liabilities
    6  
License Agreement
    6  
Liens
    7  
Material Adverse Effect
    7  
Material Contract
    19  
Material Subsidiaries
    9  
Merger
    1  
Minimum Claim Amount
    63  
New York Courts
    69  
Neyveli
    9  
Neyveli Financial Statements
    27  
Neyveli Project
    9  
Non-Hired Employee
    42  
Owned IP
    23  
Ownership Percentage
    9  

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Pension Plans
    9  
Permits
    21  
Permitted Liens
    9  
Person
    10  
Plans
    21  
Policies
    26  
Post-Closing Taxes
    46  
Pre-Closing Taxes
    45  
Prepayment Notice Date
    41  
Project
    10  
Purchase Price
    13  
Redomiciliation
    1  
Related Agreements
    10  
Released Parties
    55  
Reorganization
    1  
Rules
    69  
Schedule 5.4(a) Debt
    40  
Schedule 5.4(b) Debt
    41  
Schedule 5.6(a) Employees
    42  
Section
    12  
Section 5.7(j) Subsidiary
    50  
Seller
    1  
Seller Access and Support Agreement
    10  
Seller Disclosure Letter
    15  
Seller Indemnified Parties
    62  
Seller Returns
    44  
Seller’s Marks
    55  
Senior Employee
    35  
Shuweihat
    10  
Shuweihat Financial Statements
    28  
Shuweihat Project
    10  
Special Indemnity Period
    60  
Straddle Period
    44  
Straddle Period Returns
    44  
Straddle Statement
    44  
Subsidiary
    10  
Takoradi
    11  
Takoradi Financial Statements
    28  
Takoradi Project
    11  
Taweelah
    11  
Taweelah Financial Statements
    28  
Taweelah Project
    11  
Tax Claim
    48  
Tax Elections
    56  
Tax Indemnified Party
    48  
Tax Indemnifying Party
    48  

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Tax Return
    11  
Taxes
    11  
Third-Party Claim
    65  
Transfer Taxes
    50  
Transferred Employees
    42  
Transition Services Agreement
    11  
Treasury Regulation
    11  
UK Financial Statements
    28  
VAT
    11  

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AGREEMENT OF PURCHASE AND SALE
     This AGREEMENT OF PURCHASE AND SALE (the “Agreement”), dated as of
February 3, 2007, is made and entered into by and between CMS Enterprises
Company, a Michigan corporation (“Seller”) and Abu Dhabi National Energy Company
PJSC, a United Arab Emirates public joint stock company (“Buyer”).
W I T N E S S E T H:
     WHEREAS, CMS Generation Co., a Michigan corporation and wholly owned,
direct subsidiary of Seller (“Generation”), itself and through its subsidiaries
and various equity investments, is engaged in domestic and international
independent power production;
     WHEREAS, prior to the Closing, Seller shall cause the reorganization
pursuant to Section 5.15 to be completed (the “Reorganization”);
     WHEREAS, following the Reorganization, Generation will directly or
indirectly hold ownership interests in energy projects located in Morocco, Saudi
Arabia, India, Ghana and the United Arab Emirates;
     WHEREAS, prior to the Closing, Seller shall (a) cause Generation to be
merged by operation of law into a Delaware limited liability company in
accordance with Section 5.16 (the “Merger”) and (b) use its reasonable best
efforts, following the Merger, to cause Generation to be redomiciled in the
Cayman Islands (the “Redomiciliation”);
     WHEREAS, following the Merger, Seller will own all of the issued and
outstanding limited liability interests of Generation (the “Generation
Interests”) and all assets held directly or indirectly by Generation;
     WHEREAS, Buyer desires to purchase, and Seller desires to sell to Buyer,
the Generation Interests, upon the terms and subject to the conditions set forth
herein;
     WHEREAS, pursuant to a guarantee agreement, CMS Energy Corporation, the
parent corporation of Seller (“Energy”), has agreed to guarantee Seller’s
obligations under this Agreement (the “Energy Guarantee”); and
     WHEREAS, in connection with the transaction contemplated by this Agreement,
Buyer and Seller are entering into an agreement, dated as of the date hereof, in
respect of certain third party consents and refinancing matters (the “Consent
and Support Agreement”);
     NOW, THEREFORE, in consideration of the foregoing, the representations,
warranties, covenants and agreements set forth in this Agreement, and other good
and valuable consideration, the adequacy and receipt of which are hereby
acknowledged, the parties hereby agree as follows:

 

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ARTICLE I
DEFINITIONS; INTERPRETATIONS
          Section 1.1 Specific Definitions. For purposes of this Agreement, the
following terms shall have the meanings set forth below:

     
“Action”

“Affiliate”
  shall mean any administrative, regulatory, judicial or other formal
proceeding, action, Claim, suit, investigation or inquiry by or before any
Governmental Authority, arbitrator or mediator.

shall have the meaning set forth in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act.
 
   
“Applicable Law”
  shall mean any statute, treaty, code, law, ordinance, executive order, rule or
regulation (including a regulation that has been formally promulgated in a
rule-making proceeding but, pending final adoption, is in proposed or temporary
form having the force of law); guideline or notice having the force of law; or
approval, permit, license, franchise, judgment, order, decree, injunction or
writ of any Governmental Authority applicable to a specified Person or specified
property, as in effect from time to time.
 
   
“Business Day”
  shall mean any day that is not a Saturday, Sunday or other day on which banks
are required or authorized by law to be closed in the City of New York.
 
   
“Buyer Access and Support Agreement”
  shall mean the access and support agreement to be entered into on the Closing
Date between Seller and Buyer, substantially in the form of the agreement
attached hereto as Exhibit A.
 
   
“CGIC Loan Agreement”
  shall mean the loan agreement between Buyer or an Affiliate thereof and CMS
Generation Investment Company IV, together with the related guarantee (which
shall be released at Closing) in respect of all obligations of CMS Generation
Investment Company IV’s obligations thereunder from CMS Energy Corporation,
which agreement shall be entered into prior to the Closing Date, substantially
on the terms set forth in Exhibit D.
 
   
“Claims”
  shall mean any and all claims, lawsuits, demands, causes of action,
investigations and other proceedings (whether or not before a Governmental
Authority).
 
   
“Code”
  shall mean the Internal Revenue Code of 1986, as amended.

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“Jorf Common Agreement”
  shall mean the common agreement, dated as of September 4, 1997, among Jorf and
various lenders and their agents party thereto.
 
   
“Competition Laws”
  shall mean applicable U.S. state and federal and foreign antitrust or
competition laws and regulations.
 
   
“Confidentiality Agreement”
  shall mean the confidentiality agreement entered into by and between Buyer and
Seller, dated June 19, 2006.
 
   
“Contract”
  shall mean any contract, indenture, note, bond, loan, license, guarantee or
other binding instrument or agreement.
 
   
“Damages”
  shall mean out-of-pocket judgments, settlements, fines, penalties, damages,
Liabilities, losses, Taxes or deficiencies, costs and expenses, including
reasonable attorney’s fees, court costs, expenses of arbitration or mediation,
and other out-of-pocket expenses incurred in investigating or preparing the
foregoing; provided, however, that “Damages” shall not include incidental,
indirect or consequential damages, damages for lost profits or other special,
punitive or exemplary damages.
 
   
“Distribution”
  shall mean, in relation to Generation or any Material Subsidiary:
 
   
 
 
(i)   any dividend, distribution, repayment or repurchase of share capital or
other return of capital to such Person’s shareholders or equivalent holders of
its ownership interests;
 
   
 
 
(ii)  any repayment of any loan owed to an Affiliate of such Person;
 
   
 
 
(iii) any loan made to an Affiliate of such Person, in each case, other than
Generation or any Material Subsidiary, in each case, other than to Generation or
any Material Subsidiaries.
 
   
“Environmental Laws”
  shall mean all Applicable Laws in effect and existence as of the Closing Date
where Generation and the Material Subsidiaries currently operate relating to
pollution or protection of human health or the environment, natural resources or
safety and health, including laws relating to releases or threatened releases of
Hazardous Substances into the environment (including ambient air, surface water,
groundwater, land, surface and subsurface strata).
 
   
“Environmental Permit”
  shall mean any Permit, formal exemption, identification number or other
authorization issued by a Governmental

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  Authority pursuant to an applicable Environmental Law.
 
   
“ERISA”
  shall mean the Employee Retirement Income Security Act of 1974, as amended,
and the regulations promulgated thereunder.
 
   
“Exchange Act”
  shall mean the Securities Exchange Act of 1934, as amended.
 
   
“FERC”
  shall mean the United States Federal Energy Regulatory Commission.
 
   
“FPA”
  shall mean the Federal Power Act, as amended.
 
   
“GAAP”
  shall mean generally accepted accounting principles applicable to the relevant
entity, as in effect from time to time, applied on a consistent basis provided
that, in relation to any Person, where that Person publishes financial
statements in accordance with local generally accepted accounting principles and
an international set of generally accepted accounting principles such as the
generally accepted accounting principles in the United States of America or
International Financial Reporting Standards, “GAAP” in relation to that Person
shall mean the international set of generally accepted accounting principles.
 
   
“Generation Non-U.S. Subsidiary”
  shall mean any Generation Subsidiary which is not a Generation U.S.
Subsidiary.
 
   
“Generation Subsidiaries”
  shall mean (a) those entities that are Subsidiaries of Generation following
the Reorganization, (b) Jorf, (c) Jubail and (d) Neyveli.
 
   
“Generation U.S. Subsidiary”
  shall mean any Generation Subsidiary that is organized or created under the
laws of the United States or any state thereof, including the District of
Columbia.
 
   
“Governmental Authority”
  shall mean any executive, legislative, judicial, tribal, regulatory, taxing or
administrative agency, body, commission, department, board, court, tribunal,
arbitrating body or authority of the United States or any foreign country, or
any state, local or other governmental subdivision thereof, including regulatory
authorities that have relevant legal authority over the business, operations or
assets of Generation and/or the Material Subsidiaries.
 
   
“Hazardous Substances”
  shall mean any chemicals, materials or substances defined as or included in
the definition of “hazardous substances”, “hazardous wastes”, “hazardous
materials”, “hazardous constituents”, “restricted hazardous materials”,
“extremely

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  hazardous substances”, “toxic substances”, “contaminants”, “pollutants”,
“toxic pollutants”, or words of similar meaning and regulatory effect under any
Applicable Law.
 
   
“Indebtedness”
  shall mean (i) all liabilities and obligations of a Person for borrowed money
or evidenced by notes, bonds, commercial paper or similar instruments;
(ii) indebtedness under any hedging instrument (including any interest rate
swap, currency swap, cap, collar, floor, forward or option but excluding
commodity swaps); (iii) obligations in respect of the deferred purchase price of
property or services (other than in the ordinary course of business consistent
with past practice) to the extent that such amount would be accrued as a
liability on a balance sheet prepared in accordance with GAAP; (iv) obligations
in respect of finance or capitalized leases or hire purchase contracts, in the
amount accrued as a liability on a balance sheet prepared in accordance with
GAAP; (v) receivables sold or discounted (other than any receivables sold on a
fully non-recourse basis); (vi) any counter-indemnity obligation in respect of a
guarantee, indemnity, bond, standby or other documentary letter of credit or any
other instrument issued by a bank or financial institution; (vii) off-balance
sheet arrangements (as defined in Item 303(a) of Regulation S-K of the
Securities and Exchange Committee) of a Person that would be required to be
recorded on the balance sheet of such Person by the Sarbanes-Oxley Act of 2002;
or (viii) the amount of any liability in respect of a guarantee or indemnity for
any of the items referred to in paragraphs (i) to (vii) above.
 
   
“Intellectual Property”
  shall mean all U.S. and foreign (a) patents and patent applications,
(b) trademarks, service marks, logos, slogans, and trade dress, (c) copyrights,
(d) software (excluding commercial off-the-shelf software) and (e) all
confidential and proprietary information and know-how.
 
   
“Jorf”
  shall mean Jorf Lasfar Energy Company, SCA.
 
   
“Jorf Project”
  shall mean CMS Enterprises International LLC, CMS Enterprises Investment
Company I, CMS Generation Investment Company IV, CMS Generation Luxembourg
S.A.R.L., CMS Generation Investment Company II, CMS Generation Netherlands B.V.,
CMS Generation Jorf Lasfar II Limited Duration Company, CMS Generation Jorf
Lasfar I Limited Duration Company, Jorf Lasfar Power Energy Aktiebolag, Jorf
Lasfar Energiaktiebolag, Jorf Lasfar Handelsbolag, Jorf Lasfar I Handelsbolag,
Jorf Lasfar Power Energy Handelsbolag and Jorf Lasfar Energy Company, SCA, taken
as a whole.

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“Jubail”
  shall mean Jubail Energy Company.
 
   
“Jubail Project”
  shall mean CMS Generation Investment Company VII, CMS Jubail Investment
Company I and Jubail Energy Company, taken as a whole.
 
   
“Knowledge of Buyer”
  shall mean the knowledge, after due inquiry, of Buyer, Shuweihat Power PJSC
and Emirates Power PJSC.
 
   
“Knowledge of Seller”
  shall mean the actual knowledge of Daniel B. Dexter and the following officers
of Seller: David W. Joos, Thomas W. Elward, Thomas J. Webb, John M. Butler,
David G. Mengebier, Glenn P. Barba, Carol A. Isles, Thomas L. Miller, Laura L.
Mountcastle, Catherine M. Reynolds, Michael J. Shore, Joseph P. Tomasik and
Theodore J. Vogel, after having made due inquiry of the Persons set forth in
Section 1.1(i) of the Seller Disclosure Letter with respect to the
representations and warranties listed next to such Persons’ name.
 
   
“Liabilities”
  shall mean any and all debts, liabilities, commitments and obligations,
whether or not fixed, contingent or absolute, matured or unmatured, liquidated
or unliquidated, accrued or unaccrued, known or unknown, whether or not required
by GAAP to be reflected in financial statements or disclosed in the notes
thereto.
 
   
“License Agreement”
  shall mean the license agreement to be entered into on the Closing Date
between Seller and Buyer, substantially in the form of the agreement attached
hereto as Exhibit B.
 
   
“Liens”
  shall mean any mortgage, pledge, lien (statutory or otherwise and including,
without limitation, environmental, ERISA and tax liens), security interest,
easement, right of way, limitation, encroachment, covenant, claim, restriction,
right, option, conditional sale or other title retention agreement, charge or
encumbrance of any kind or nature (except for any restrictions arising under any
applicable securities laws).
 
   
“Material Adverse Effect”
  shall mean a material adverse effect on (a) the business, financial condition
or assets of Generation and the Material Subsidiaries, taken as a whole or
(b) the ability of Seller to consummate the transactions contemplated hereby, in
each case, other than any effect resulting from, relating to or arising out of:
(i) the negotiation, execution, announcement of this Agreement and the
transactions contemplated hereby, including the impact thereof on relationships,
contractual or

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  otherwise, with customers, suppliers, distributors, partners, joint owners or
venturers and employees, (ii) the general state of the industries in which
Generation or the Material Subsidiaries operate, to the extent Generation and
the Material Subsidiaries, taken as a whole are not disproportionately affected
(including (A) pricing levels, (B) changes in the international, national,
regional or local wholesale or retail markets for fuel sources or electricity or
(C) rules, regulations or decisions of Governmental Authorities, including FERC,
or the courts affecting the electricity generation industry as a whole, or rate
orders, motions, complaints or other actions affecting Generation or the
Material Subsidiaries), (iii) any condition described in the Seller Disclosure
Letter, (iv) general legal, regulatory, political, business, economic, capital
market and financial market conditions (including prevailing interest rate
levels and foreign exchange rates), or conditions otherwise generally affecting
the industries in which Generation or the Material Subsidiaries operate, to the
extent Generation and the Material Subsidiaries, taken as a whole are not
disproportionately affected, (v) any change in law, rule or regulation or GAAP
or interpretations thereof applicable to Generation, the Material Subsidiaries,
Seller or Buyer, to the extent Generation and the Material Subsidiaries, taken
as a whole are not disproportionately affected, (vi) acts of God, national or
international political or social conditions, including the engagement by any
nation or Person in hostilities, whether commenced before or after the date
hereof, and whether or not pursuant to the declaration of a national emergency
or war, or the occurrence of any military or terrorist attack, to the extent
Generation and the Material Subsidiaries, taken as a whole are not
disproportionately affected, or (vii) general economic conditions in any of the
geographic areas in which Generation or the Material Subsidiaries operates, to
the extent Generation and the Material Subsidiaries, taken as a whole are not
disproportionately affected; provided, that for purposes of determining a
“Material Adverse Effect”, any effect on the business, financial condition or
assets of the business of any Material Subsidiary shall include only the portion
of such effect attributable to the ownership interest of Generation and its
Affiliates and shall exclude any portion of such effect attributable to the
ownership interest of any third party in such Material Subsidiary and, provided,
further, that for the avoidance of doubt, without prejudice to the exclusions
set forth in paragraphs (i) to (vii) (inclusive) above, which exclusions shall
apply in all respects, in relation to any determination of whether a “Material
Adverse Effect” has

7

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  occurred, a Material Adverse Effect shall be deemed to have occurred, except
for purposes of Section 6.2(a), if:
 
   
 
  (A) any event or circumstance, which individually or in the aggregate, has
resulted in Generation’s gross consolidated billed revenues (calculated in a
manner consistent with past practice and the best practices of a reasonable and
prudent operator of a similar business, Section 1.1(ii) of the Seller Disclosure
Letter and including any amounts paid as a result of business interruption
insurance (without double counting)) for the period commencing on the date
hereof and ending on the Closing Date being $50,000,000 (fifty million dollars)
less than the forecasted revenues for such period as set forth in
Section 1.1(ii) of the Seller Disclosure Letter (which calculation, for the
avoidance of doubt, shall include any such gross consolidated billed revenues
for such period that are more than such forecasted revenues for such period as
an offset to such gross consolidated billed revenues that are less than such
forecasted revenues), or
 
   
 
  (B) any event or circumstance that, in the opinion of a third party consultant
to be mutually agreed upon by the parties, will result in a shutdown of a
Project for a period of six (6) months (for any Project that has more than one
generating unit) or eight (8) months (for any Project that has only one
generating unit).
 
   
“Material Subsidiaries”
  shall mean the Generation Subsidiaries, Shuweihat and Taweelah.
 
   
“Neyveli”
  shall mean ST-CMS Electric Company Private Limited.
 
   
“Neyveli Project”
  shall mean CMS International Ventures, L.L.C., CMS Generation Investment
Company III, CMS Generation Neyveli Ltd., ST-CMS Electric Company (Mauritius)
and ST-CMS Electric Company Pvt. Ltd., taken as a whole.
 
   
“Ownership Percentage”
  shall mean, with respect to any Material Subsidiary, the percentage of the
equity represented by securities or ownership interests, or, in the case of a
partnership, the percentage of the profits and losses of such partnership, owned
directly or indirectly by Generation as of the Closing Date.
 
   
“Pension Plans”
  shall mean all Plans providing pensions, superannuation benefits or retirement
savings, including pension plans, top up pensions or supplemental pensions.

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“Permitted Liens”
  shall mean (a) zoning, planning and building codes and other applicable laws
regulating the use, development and occupancy of real property and permits,
consents and rules under such laws, (b) encumbrances, easements, rights-of-way,
covenants, conditions, restrictions and other matters affecting title to real
property which do not materially detract from the value of such real property or
materially restrict the use of such real property, (c) leases and subleases of
real property requiring payments of less than $500,000, (d) all easements,
encumbrances or other matters which are necessary for utilities and other
similar services on real property, (e) Liens to secure Indebtedness in an amount
less than $1,000,000 reflected in the financial statements of Generation or the
Material Subsidiaries or Indebtedness incurred in the ordinary course of
business, consistent with past practice, after the date thereof, (f) Liens for
Taxes and other governmental levies, in each case in an amount less than
$100,000 not yet due and payable or, if due, (i) not delinquent or (ii) being
contested in good faith by appropriate proceedings during which collection or
enforcement against the property is stayed and with respect to which adequate
reserves have been established and are being maintained to the extent required
by GAAP, (g) mechanics’, workmen’s, repairmen’s, materialmen’s, warehousemen’s,
carriers’ or other Liens, including all statutory Liens, arising or incurred in
the ordinary course of business, (h) original purchase price conditional sales
contracts and equipment leases with third parties entered into in the ordinary
course of business, (i) Liens that do not materially interfere with or
materially affect the value or use of the respective underlying asset to which
such Liens relate and (j) Liens that are reflected in any Material Contract.
 
   
“Person”
  shall mean any natural person, corporation, company, general partnership,
limited partnership, limited liability partnership, joint venture,
proprietorship, limited liability company, or other entity or business
organization or vehicle, trust, unincorporated organization or Governmental
Authority or any department or agency thereof.
 
   
“Project”
  shall mean Jorf Project, Jubail Project, Neyveli Project, Shuweihat Project,
Takoradi Project or Taweelah Project.
 
   
“Related Agreements”
  shall mean the Buyer Access and Support Agreement, the Seller Access and
Support Agreement, the License Agreement, and the Transition Services Agreement.
 
   
“Seller Access and
  shall mean the access and support agreement to be entered into

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Support Agreement”
  on the Closing Date between Seller and Buyer, substantially in the form of the
agreement attached hereto as Exhibit H.
 
   
“Shuweihat”
  shall mean Shuweihat General Partner Company, Shuweihat Limited Partnership,
Shuweihat O&M Limited Partnership, Shuweihat O&M General Partner Company and
Shuweihat CMS International Power Company.
 
   
“Shuweihat Project”
  shall mean CMS Generation Investment Company VII, Shuweihat General Partner
Company, Shuweihat Limited Partnership, Shuweihat CMS International Power
Company and Shuweihat Shared Facilities Company LLC, taken as a whole.
 
   
“Subsidiary”
  of any entity means, at any date, any Person of which securities or other
ownership interests representing more than fifty percent (50%) of the equity or
more than fifty percent (50%) of the ordinary voting power or, in the case of a
partnership, more than fifty percent (50%) of the general partnership interests
or more than fifty percent (50%) of the profits or losses of which are, as of
such date, owned, controlled or held by the applicable Person or one or more
subsidiaries of such Person.
 
   
“Takoradi”
  shall mean Takoradi International Company.
 
   
“Takoradi Project”
  shall mean CMS Generation Investment Company VI, CMS Takoradi Investment
Company, CMS Takoradi Investment Company II and Takoradi International Company,
taken as a whole.
 
   
“Taweelah”
  shall mean Emirates CMS Power Company.
 
   
“Taweelah Project”
  shall mean CMS Generation Taweelah Limited, Emirates CMS Power Company and
Taweelah Shared Facility Company LLC, taken as a whole.
 
   
“Tax Return”
  shall mean any report, return, declaration, or other information required to
be supplied to a Governmental Authority in connection with Taxes including any
schedule thereto, claim for refund or amended return.
 
   
“Taxes”
  shall mean all United States federal, state or local or non-United States
taxes, assessments, charges, duties, levies or other similar governmental
charges of any nature, including all income, franchise, profits, capital gains,
capital stock, transfer, sales, use, occupation, property, excise or excise
duty, severance, windfall profits, stamp, stamp duty reserve, license,

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  payroll, withholding, ad valorem, value added, alternative minimum,
environmental, customs, social security (or similar), unemployment, sick pay,
disability, registration, service and other taxes, assessments, charges, duties,
fees, levies or other similar governmental charges of any kind whatsoever,
whether disputed or not, together with all estimated taxes, deficiency
assessments, additions to tax, penalties and interest.
 
   
“Transition Services Agreement”
  shall mean the transition services agreement to be entered into on the Closing
Date between Seller and Buyer, substantially in the form of the agreement
attached hereto as Exhibit C.
 
   
“Treasury Regulation”
  shall mean the income Tax regulations, including temporary and proposed
regulations, promulgated under the Code, as amended.
 
   
“VAT”
  shall mean (i) in member States of the European Union, taxes in those States
imposed by or in compliance with the Sixth Council Directive of the European
Communities (as amended from time to time) and (ii) in other states, any value
added tax or other similar tax.

          Section 1.2 Interpretation.
               (a) Unless the context of this Agreement otherwise requires,
(i) words of any gender include the other gender; (ii) words using the singular
or plural number also include the plural or singular number, respectively;
(iii) the terms “hereof,” “herein,” “hereby” and derivative or similar words
refer to this entire Agreement; (iv) the terms “Article,” “Section” and
“Exhibit” refer to the specified Article, Section and Exhibit of this Agreement,
respectively; (v) “including,” shall mean “including, but not limited to;” and
(vi) reference to any Person includes such Person’s successors and permitted
assigns. Unless otherwise expressly provided, any agreement, instrument, law or
regulation defined or referred to herein means such agreement, instrument, law
or regulation as from time to time amended, modified or supplemented, including
(in the case of agreements or instruments) by waiver or consent and (in the case
of a law or regulation) by succession of comparable successor law and includes
(in the case of agreements or instruments) references to all attachments thereto
and instruments incorporated therein.
               (b) As of the Closing Date, the term “Generation” shall mean CMS
Generation LLC, a Delaware limited liability company, if the Merger has occurred
but the Redomiciliation has not yet occurred as of the Closing Date, and CMS
Generation LLC, a Cayman Islands limited liability company, if the
Redomiciliation has occurred as of the Closing Date.
               (c) For purposes of Article III, (i) all representations and
warranties made by Seller (other than those representations and warranties set
forth in

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Section 3.1, 3.2 and 3.3(a)-(g) inclusive) with respect to Jorf, Jubail,
Neyveli, Shuweihat and Taweelah (or which are picked up through references to
Generation Subsidiaries or Material Subsidiaries) shall automatically be deemed
to be qualified by the Knowledge of Seller and (ii) all representations and
warranties made by Seller with respect to Shuweihat CMS International Power
Company and Taweelah shall automatically be deemed to be qualified by the
Knowledge of Seller and the Knowledge of Buyer.
               (d) For purposes of Article V, in the event that Seller shall be
obligated to cause, or use its reasonable best efforts to cause, an Affiliate or
Material Subsidiary over which it does not have voting control to act or not
act, it shall be obligated to exercise all of its contractual and other rights
to cause such action or inaction by such Affiliate or Material Subsidiary.
               (e) Unless otherwise indicated, all references to Generation or a
Material Subsidiary in Articles I, III and V shall be to Generation and the
Material Subsidiaries assuming the Reorganization has occurred.
ARTICLE II
SALE AND PURCHASE
          Section 2.1 Agreement to Sell and Purchase.
               (a) Buyer and Seller hereby agree that, upon the terms and
subject to the satisfaction or waiver, if permissible, of the conditions hereof,
at the Closing, Buyer shall purchase, acquire and accept from Seller, and Seller
shall sell, convey, assign, transfer and deliver to Buyer, the Generation
Interests, free and clear of all Liens. In consideration for the purchase of the
Generation Interests pursuant to this Section 2.1(a), Buyer shall deliver to the
Seller (i) the Deposit pursuant to Section 2.1(b) and (ii) the Closing Payment
pursuant to Section 2.1(c) (collectively, together with any amounts disbursed to
Seller or its Affiliates, on the one hand, by Buyer or its Affiliates, on the
other hand, pursuant to the CGIC Loan Agreement, the “Purchase Price”).
               (b) Upon the receipt of the Energy Guarantee (together with a
copy of the authorizing board resolutions of Energy), Buyer shall pay to Seller,
in consideration for the execution by Seller of this Agreement and the covenants
and agreements set forth herein, an amount in cash equal to $75,000,000 (the
“Deposit”) by wire transfer of same day funds to an account or accounts and in
such amounts as designated by Seller prior to the execution of this Agreement.
               (c) At the Closing, Buyer shall pay to Seller, in consideration
for the purchase of the Generation Interests pursuant to Section 2.1(a), an
amount in cash equal to the difference between (i) $825,000,000 and (ii) any
amounts disbursed to Seller or its Affiliates, on the one hand, by Buyer or its
Affiliates, on the other hand, pursuant to the CGIC Loan Agreement (the “Closing
Payment”).
          Section 2.2 Time and Place of Closing.

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               (a) Upon the terms and subject to the satisfaction or, if
permissible, waiver, of the conditions of this Agreement, the consummation of
the transactions contemplated by this Agreement (the “Closing”) shall take place
on the fifth (5th) Business Day following the satisfaction or, if permissible,
waiver of the conditions set forth in Article VI hereof (other than conditions
which by their nature can be satisfied only at the Closing), at 10:00 a.m. New
York City time, at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, Four
Times Square, New York, New York 10036, or at such other time and place as shall
be agreed upon by the parties hereto. The date on which the Closing occurs is
herein referred to as the “Closing Date.”
               (b) At the Closing, Seller shall deliver or cause to be delivered
to Buyer (unless previously delivered), the following items:
               (i) a certificate or certificates representing the Generation
Interests (or other appropriate certificates evidencing transfer of ownership),
accompanied by stock or similar powers duly endorsed in blank by Seller or
accompanied by instruments of transfer duly executed by Seller;
               (ii) the officer’s certificate referred to in Section 6.2(c);
               (iii) a duly executed counterpart of each of the Related
Agreements;
               (iv) written resignations, effective as of the Closing Date, from
each of the officers and directors of any of Generation or the Material
Subsidiaries, to the extent such officers and directors are appointed or
nominated by Seller or its Affiliates and will not continue to perform such
roles following Closing;
               (v) such other duly executed instruments of transfer, assignment
or assumption and such other documents as may be reasonably requested by Buyer
to evidence the proper consummation of Closing in connection with the
transactions contemplated hereby; and
               (vi) all documentation required to be executed by Seller or its
Subsidiaries relating to the transactions contemplated by Section 5.4 hereof.
               (c) At the Closing, Buyer shall deliver or cause to be delivered
to Seller (unless previously delivered), the following items:
               (i) the Closing Payment by wire transfer of same day funds to an
account or accounts and in such amounts as designated by Seller in writing at
least two Business Days prior to the Closing Date;

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               (ii) the officer’s certificate referred to in Section 6.3(c);
               (iii) a duly executed counterpart of each of the Related
Agreements;
               (iv) all documentation required to be executed by Buyer or its
Affiliates relating to the transactions contemplated by Section 5.4 hereof; and
               (v) such other duly executed instruments of transfer, assignment
or assumption and such other documents as may be reasonably requested by Seller
to evidence the proper consummation of Closing in connection with the
transactions contemplated hereby.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
     Except as set forth in a letter delivered by Seller to Buyer on the date
hereof (the “Seller Disclosure Letter”), Seller hereby represents and warrants
to Buyer as follows:
          Section 3.1 Corporate Organization; Qualification. (a) Seller is duly
incorporated, validly existing and in good standing under the Laws of Michigan.
Each of Generation and the Material Subsidiaries is duly organized and validly
existing and each of Generation (as of the date hereof) and the Material
Subsidiaries organized in the United States is in good standing, in each case
under the laws of its governing jurisdiction.
               (b) Each of Generation and the Material Subsidiaries has the
requisite power to carry on its businesses as currently conducted in all
material respects.
               (c) Each of Generation and the Material Subsidiaries is duly
qualified to do business in each of the jurisdictions in which the ownership,
operation or leasing of its properties or assets or the conduct of its business
requires it to be so qualified, except where the failure to be so qualified
would not materially and adversely affect the ability of, or timing for, Seller
to consummate the transactions contemplated by this Agreement or Related
Agreements or materially and adversely affect the business or operations of such
entity.
          Section 3.2 Authority Relative to this Agreement.
               (a) Seller has full corporate power and authority to execute and
deliver this Agreement, the Related Agreements, the Consent and Support
Agreement and the other agreements, documents and instruments to be executed and
delivered by it in connection with this Agreement and the Related Agreements and
to consummate the transactions contemplated hereby and thereby.

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               (b) The execution, delivery and performance of this Agreement,
the Related Agreements, the Consent and Support Agreement and the other
agreements, documents and instruments to be executed and delivered by Seller in
connection with this Agreement, the Related Agreements or the Consent and
Support Agreement and the consummation of the transactions contemplated hereby
and thereby have been duly and validly authorized by all the necessary action on
the part of Seller, and no other corporate or other proceedings on the part of
Seller are necessary to authorize this Agreement, the Related Agreements, the
Consent and Support Agreement and the other agreements, documents and
instruments to be executed and delivered by Seller in connection with this
Agreement, the Related Agreements and the Consent and Support Agreement or to
consummate the transactions contemplated hereby and thereby.
               (c) This Agreement and the Consent and Support Agreement have
been, and the Related Agreements and the other agreements, documents and
instruments to be executed and delivered in connection with this Agreement, the
Related Agreements or the Consent and Support Agreement as of or prior to the
Closing Date will be, duly and validly executed and delivered by Seller and,
assuming that this Agreement, the Related Agreements, the Consent and Support
Agreement and the other agreements, documents and instruments to be executed and
delivered by Seller in connection with this Agreement, the Related Agreements or
the Consent and Support Agreement constitute legal, valid and binding agreements
of Buyer, are (in the case of this Agreement and the Consent and Support
Agreement) or will be as of the Closing Date (in the case of the Related
Agreements and the other agreements, documents and instruments to be executed
and delivered on or prior to the Closing Date in connection with this Agreement,
the Related Agreements or the Consent and Support Agreement) enforceable against
Seller in accordance with their respective terms, except that such
enforceability may be limited by applicable bankruptcy, insolvency, moratorium
or other similar laws affecting or relating to enforcement of creditors’ rights
generally or general principles of equity.
          Section 3.3 Generation Interests.
               (a) As of the date hereof, all of the outstanding shares of
capital stock of Generation (the “Generation Shares”) are duly authorized,
validly issued and fully paid and were not issued in violation of any preemptive
rights. As of the date hereof, except as set forth in Section 3.3(a) of the
Seller Disclosure Letter, (i) there are no shares of capital stock of Generation
authorized, issued or outstanding or reserved for any purpose and (ii) there are
no (A) existing options, warrants, calls, preemptive rights, subscriptions or
other rights, agreements, arrangements or commitments of any character, relating
to the Generation Shares, obligating Seller or any of its Affiliates to issue,
transfer or sell, or cause to be issued, transferred or sold, any of the
Generation Shares, (B) outstanding securities of Seller or its Affiliates that
are convertible into or exchangeable or exercisable for any of the Generation
Shares, (C) options, warrants or other rights to purchase from Seller or its
Affiliates any such convertible or exchangeable securities, (D) outstanding
Liabilities to pay any additional amounts on the Generation Shares (including
any outstanding shareholder loan arrangements) or (E) other than this Agreement,
Contracts of any kind relating to the issuance of any of the Generation

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Shares, or any such options, warrants or rights, pursuant to which, in any of
the foregoing cases, Seller or its Affiliates are subject or bound.
               (b) As of the Closing Date, the Generation Interests will be duly
authorized and not issued in violation of any preemptive rights. As of the
Closing Date, except as set forth in Section 3.3(b) of the Seller Disclosure
Letter, (i) there will be no shares of capital stock or other equity interests
of Generation authorized, issued or outstanding or reserved for any purpose and
(ii) there will be no (A) existing options, warrants, calls, preemptive rights,
subscriptions or other rights, agreements, arrangements or commitments of any
character, relating to the Generation Interests, obligating Seller or any of its
Affiliates to issue, transfer or sell, or cause to be issued, transferred or
sold, any of the Generation Interests, (B) outstanding securities of Seller or
its Affiliates that are convertible into or exchangeable or exercisable for any
of the Generation Interests, (C) options, warrants or other rights to purchase
from Seller or its Affiliates any such convertible or exchangeable securities,
(D) outstanding Liabilities to pay any additional amounts on the Generation
Interests (including any outstanding shareholder loan arrangements) or (E) other
than this Agreement or Contracts of any kind relating to the issuance of any of
the Generation Interests, or any such options, warrants or rights, pursuant to
which, in any of the foregoing cases, Seller or its Affiliates are subject or
bound.
               (c) As of the date hereof, except as set forth in Section 3.3(c)
of the Seller Disclosure Letter, Seller owns all of the issued and outstanding
Generation Shares and has good, valid and marketable title to the Generation
Shares, free and clear of all Liens or other defects in title, and the
Generation Shares have not been pledged or assigned to any Person. Except as set
forth in Section 3.3(c) of the Seller Disclosure Letter, as of the date hereof,
the Generation Shares owned by Seller are not subject to any restrictions on
transferability other than those imposed by this Agreement and by applicable
securities laws.
               (d) As of the Closing Date, except as set forth in Section 3.3(d)
of the Seller Disclosure Letter, Seller will own all of the issued and
outstanding Generation Interests and will have good, valid and marketable title
to the Generation Interests, free and clear of all Liens or other defects in
title, and the Generation Interests will not have been pledged or assigned to
any Person. As of the Closing Date, the Generation Interests owned by Seller
will not be subject to any restrictions on transferability other than those
imposed by this Agreement and by applicable securities laws.
               (e) Assuming the Reorganization has occurred, except as set forth
in Section 3.3(e)(i) of the Seller Disclosure Letter, Generation and each Person
in which Generation, directly or indirectly, holds shares, outstanding capital
stock or partnership or other ownership interests as described in the corporate
organization chart set forth in Section 5.15 of the Seller Disclosure Letter, as
applicable, has good, valid and marketable title to such shares of outstanding
capital stock or partnership or other ownership interest of each Material
Subsidiary as set forth in Section 3.3(e)(ii) of the Seller Disclosure Letter.

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               (f) Section 3.3(f) of the Seller Disclosure Letter sets forth, as
of the date hereof, assuming completion of the Reorganization, a complete and
accurate list of each Material Subsidiary, including its name, its jurisdiction
of incorporation, its authorized and outstanding capital stock or partnership or
other ownership interest and the percentage of its outstanding capital stock or
partnership or other ownership interest owned by Generation or its Subsidiaries.
Except as set forth in Section 3.3(f) of the Seller Disclosure Letter, the
shares of outstanding capital stock or partnership or other ownership interests
of each Material Subsidiary held by Generation or its Subsidiaries are duly
authorized, validly issued, fully paid and nonassessable, and are held of record
by Generation or its Subsidiaries, free and clear of Liens. Except as set forth
in Section 3.3(f) of the Seller Disclosure Letter, there are no (i) existing
options, warrants, calls, preemptive rights, subscriptions or other rights,
agreements, arrangements or commitments of any character, relating to the
capital stock or partnership or other ownership interest of any Material
Subsidiary held by Generation or its Affiliates, obligating Seller or Generation
or any of their Affiliates to issue, transfer or sell, or cause to be issued,
transferred or sold, any capital stock or partnership or other ownership
interest of any Material Subsidiary, (ii) outstanding securities or partnership
or other ownership interest of Seller or Generation or their Affiliates that are
convertible into or exchangeable or exercisable for any of capital stock or
partnership or other ownership interest of any Material Subsidiary,
(iii) options, warrants or other rights to purchase from Seller or Generation or
their Affiliates any such convertible or exchangeable securities or (iv) other
than this Agreement, contracts, agreements or arrangements of any kind relating
to the issuance of any of the capital stock or partnership or other ownership
interest of any Material Subsidiary held by Generation or its Affiliates, or any
such options, warrants or rights, pursuant to which, in any of the foregoing
cases, Seller or its Affiliates are subject or bound.
               (g) Assuming completion of the Reorganization, other than the
Material Subsidiaries or as otherwise set forth in Section 3.3(g) of the Seller
Disclosure Letter, there are no Persons in which any of Generation or any
Material Subsidiary owns any equity or other similar interest.
               (h) Except as set forth in Section 3.3(h) of the Seller
Disclosure Letter, Generation or a Material Subsidiary (as applicable) has valid
title to or leases, free and clear of any Liens (other than Permitted Liens) all
material assets used or held for use by Generation or a Material Subsidiary (as
applicable), except for such material assets the failure of which to so own or
lease would not, individually or in the aggregate, materially impact the
business or operations of Generation or a Project.

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          Section 3.4 Consents and Approvals. Except as set forth in Section 3.4
of the Seller Disclosure Letter, Seller requires no Permit, consent, approval or
authorization of, or filing, registration or qualification with, any
Governmental Authority or any other Person (including pursuant to the Uniting
and Strengthening America by Providing Appropriate Tools Required to Intercept
and Obstruct Terrorism Acts of 2001) as a condition to the execution and
delivery by Seller of this Agreement or the performance of its obligations
hereunder, except where the failure to obtain such Permit, consent, approval or
authorization of, or filing of, registration or qualification with, any
Governmental Authority, or any other Person would not be material to the
business, financial condition or assets of Generation and the Material
Subsidiaries, taken as a whole.
          Section 3.5 No Conflict or Violation. Except as set forth in
Section 3.5 of the Seller Disclosure Letter, the execution, delivery and
performance by Seller (or Seller’s relevant Affiliates, if appropriate) of this
Agreement, the Related Agreements and the Consent and Support Agreement do not:
               (a) violate or conflict with any provision of the organizational
documents or bylaws of Seller, Generation or any Material Subsidiary;
               (b) violate any applicable provision of a law, statute, judgment,
order, writ, injunction, decree, award, rule or regulation of any Governmental
Authority, except where such violations that would not, individually or in the
aggregate, be material;
               (c) violate, result in a breach of, constitute (with due notice
or lapse of time or both) a default or cause any obligation, penalty or premium
to arise or accrue under any Material Contract, lease, loan, mortgage, security
agreement, trust indenture or other material agreement or instrument to which
Generation or any Material Subsidiary is a party or by which any of them is
bound or to which any of their respective properties or assets is subject,
except for violations, breaches or defaults that would not, individually or in
the aggregate, be material;
               (d) result in the imposition or creation of any Lien upon or with
respect to any of the properties or assets owned or used by Generation or a
Material Subsidiary; or
               (e) result in the cancellation, modification, revocation or
suspension of any Permits or, to the Knowledge of Seller, in the failure to
renew any Permit.
          Section 3.6 Contracts.
               (a) Except as set forth in Section 3.6(a) of the Seller
Disclosure Letter, each Contract set forth in Section 3.6(d) of the Seller
Disclosure Letter (each a “Material Contract”), is a valid and binding agreement
of Generation or a Material Subsidiary and, to the Knowledge of Seller, is in
full force and effect.

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               (b) Except as set forth in Section 3.6(b) of the Seller
Disclosure Letter, neither Generation nor any Material Subsidiary is in default
under any Material Contract other than defaults that have been cured or waived
or which do not, individually or in the aggregate, materially impact the
business or operations of Generation or a Project;
               (c) Except as set forth in Section 3.6(c) of the Seller
Disclosure Letter, to the Knowledge of Seller, there are no defaults under any
Material Contract by a third party, other than defaults that do not,
individually or in the aggregate, materially impact the business or operations
of Generation or a Project;
               (d) Except as set forth in Section 3.6(d) of the Seller
Disclosure Letter neither Generation nor any Material Subsidiary is currently
bound by a Contract of the type described in paragraphs (i) through (iii) below:
               (i) any Contract involving the payment or receipt of greater than
$10,000,000;
               (ii) any Contract by which Generation or a Material Subsidiary
has any Indebtedness in excess of $2,500,000; or
               (iii) any Contract that establishes any joint venture, consortium
or partnership agreement.
               (e) Except as set forth on Section 3.6(e) of the Seller
Disclosure Letter, Seller has made available to Buyer accurate and complete
copies of all Material Contracts on or prior to the date hereof, and, to the
Knowledge of Seller, no Material Contract has been amended since being made
available to Buyer, other than amendments made with Buyer’s consent pursuant to
Section 5.1 hereof.
          Section 3.7 Compliance with Law.
               (a) Except for laws relating to employee benefit plans, labor and
employment law, Environmental Laws and Tax laws, which are the subject of
Section 3.10, Section 3.11, Section 3.13 and Section 3.14, respectively, and
except as set forth in Section 3.7 of the Seller Disclosure Letter, Generation
and the Material Subsidiaries are in compliance with all federal, state, local
or foreign laws, statutes, ordinances, rules, regulations, judgments, orders,
writs, injunctions or decrees of any Governmental Authority applicable to their
respective properties, assets and businesses except where such noncompliance
does not, individually or in the aggregate, materially impact the business or
operations of Generation or a Project.
               (b) To the Knowledge of Seller, no Material Subsidiary or
Employee of a Material Subsidiary is or has been engaged in any corrupt practice
in connection with any asset of Seller, Generation or the Material Subsidiaries
(including any arrangement to pay or receive any unlawful commission, bribe,
pay-off or kickback), nor has any potential violation under the Foreign Corrupt
Practices Act of 1977.

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          Section 3.8 Permits. Except as set forth in Section 3.8 of the Seller
Disclosure Letter, Seller, Generation and the Material Subsidiaries have all
permits, licenses, certificates of authority, orders and approvals of, and have
made all filings applications and registrations with Governmental Authorities
required under Applicable Law, which are necessary for the conduct of the
respective business operations of Generation and the Material Subsidiaries as
presently conducted (collectively, the “Permits”), except for those Permits the
absence of which does not, individually or in the aggregate, materially impact
the business or operations of Generation or a Project. Each Permit has been
complied with in all material respects and has not been, and is not reasonably
likely to be, cancelled, modified, revoked or suspended or failed to be renewed,
except for Permits that do not, individually or in the aggregate, materially
impact the business or operations of Generation or a Project. No notice has been
received by Seller, Generation or a Material Subsidiary that any material Permit
will be revoked or will not be renewed or be renewed only on terms which would
restrict or prevent the holder thereof from conducting its material operations
in the ordinary course of business. None of Seller, Generation or a Material
Subsidiary has taken any action or omitted to take any action which would
reasonably be expected to result in any material grant from a Governmental
Authority paid being refunded in whole or in material part.
          Section 3.9 Litigation. Except as set forth in Section 3.9 of the
Seller Disclosure Letter, there are no lawsuits, actions, proceedings pending or
in progress (including in respect of claims which may be brought by or on behalf
of employees or former employees in respect of death or personal injury
resulting from their employment by Generation or any Material Subsidiary), or to
the Knowledge of Seller, proceedings or governmental, administrative or other
investigations pending or in progress or, to the Knowledge of Seller, threatened
against Seller or any of its Affiliates or any executive officer or director
thereof relating to the Generation Interests or the respective assets or
businesses of Generation or the Material Subsidiaries, except as would not be
material to the business, financial condition or assets of Generation and the
Material Subsidiaries, taken as a whole. Seller and its Affiliates are not
subject to any outstanding judgment, order, writ, injunction, decree or award
entered in an Action to which Seller or any of its Affiliates was a named party
relating to the Generation Interests or the respective assets or businesses of
Generation or the Material Subsidiaries, except as would not, individually or in
the aggregate, materially impact the business or operations of Generation or a
Project.
          Section 3.10 Employee Matters.
               (a) Section 3.10(a) of the Seller Disclosure Letter lists all
material benefit and compensation plans and contracts, including “employee
benefit plans” within the meaning of Section 3(3) of ERISA, and deferred
compensation, stock option, stock purchase, stock appreciation rights,
stock-based incentive bonus, severance, employment, change in control, vacation
or fringe benefit programs, policies, agreements, arrangements or plans
maintained by Generation or any Subsidiary of Generation for the benefit of any
or their employees or former employees, (the “Employees”) (collectively, the
“Plans”). True and complete copies of all material Plans, including any trust
instruments and insurance contracts forming a part of any Plans, and

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all amendments thereto have been provided or made available to Buyer or its
representatives.
               (b) Each Plan is registered, funded, administered and invested,
as applicable, in compliance with the current terms of such Plan, and in
accordance with Applicable Laws.
               (c) For any Plan where contributions are required to be made in
accordance with an actuarial valuation report, all contributions required to be
made to such Plan as of the date hereof have been made in accordance with the
actuarial report most recently filed with the applicable Governmental Authority
in a timely fashion.
               (d) For any Plan where contributions are not required to be made
in accordance with an actuarial valuation report, all contributions required to
be made to such Plan as of the date hereof have been made.
               (e) To the Knowledge of Seller, no event has occurred respecting
any registered Plan that would result in the revocation of the registration of
such Plan or that could otherwise reasonably be expected to adversely affect the
tax status of any such Plan.
               (f) As of the date hereof, each of Generation and the
Subsidiaries of Generation have made all contributions to the Pension Plans to
which Generation and the Subsidiaries of Generation are required to make
contributions.
               (g) With respect to each Plan, (i) no material Action is pending
or, to the Knowledge of Seller, threatened and (ii) to the Knowledge of Seller
no facts or circumstances exist that would give rise to any material Actions.
               (h) Except as set forth in Section 3.10(h) of the Seller
Disclosure Letter, in the three (3) years prior to the date hereof there have
been no partial or full wind-ups declared in respect of any Pension Plan.
               (i) Except as set forth in Section 3.10(i) of the Seller
Disclosure Letter, neither Generation nor any Material Subsidiary has made any
written promise to create any Plan or to improve or change the benefits provided
under any Plan.
               (j) Except as set forth in Section 3.10(j) of the Seller
Disclosure Letter, the consummation of the transactions contemplated hereby will
not (i) entitle any current or former employee or officer of any of Generation
or a Material Subsidiary to advance notice, termination pay, severance pay,
unemployment compensation or any other payment, the liability for which would be
borne by Buyer, or (ii) accelerate the time of payment or vesting, or increase
the amount of compensation due any such employee or officer, the liability for
which would be borne by Buyer.
          Section 3.11 Labor Relations. Except as set forth in Section 3.11 of
the Seller Disclosure Letter; (a) none of Generation or any Material Subsidiary
is a party to any labor or collective bargaining agreements, and there are no
labor or collective

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bargaining agreements which pertain to any employees of Generation or any
Material Subsidiary; (b) within the preceding twelve (12) months, there have
been no representation or certification proceedings, or petitions seeking a
representation proceeding, pending or, to the Knowledge of Seller, threatened in
writing to be brought or filed with the National Labor Relations Board or any
other labor relations tribunal or authority with respect to Generation or any
Material Subsidiary; (c) within the preceding twelve (12) months, to the
Knowledge of Seller, there have been no organizing activities involving
Generation or any Material Subsidiary with respect to any group of their
respective employees; (d) there are no pending or, to the Knowledge of Seller,
threatened strikes, work stoppages, slowdowns or lockouts against Generation or
a Material Subsidiary involving any of their respective Employees; and (e) there
are no pending material unfair employment practice charges, grievances or
complaints filed or, to the Knowledge of Seller, threatened to be filed with any
Governmental Authority based on the employment or termination of employment by
Generation or a Material Subsidiary of any Senior Employee.
          Section 3.12 Intellectual Property.
               (a) Section 3.12(a) of the Seller Disclosure Letter sets forth a
list of all material U.S. and foreign: (i) patents and patent applications,
(ii) trademark registrations and applications and (iii) copyright registrations
and applications, owned by Generation or a Material Subsidiary (the “Owned IP”).
The foregoing schedules set forth at Section 3.12(a) of the Seller Disclosure
Letter are complete and accurate in all material respects. The foregoing
registrations are in effect and subsisting.
               (b) To the Knowledge of Seller, Generation or a Material
Subsidiary owns all of the rights and interests in and has title to, or has
validly licensed to it, all of the Owned IP.
               (c) To the Knowledge of Seller, Generation or a Material
Subsidiary owns or has a valid right to use all the Intellectual Property
required to conduct the business of Generation and each Material Subsidiary as
conducted as of the date of this Agreement.
               (d) To the Knowledge of Seller, (i) the payment of fees due that
are necessary to maintain the material Owned IP have been made, and (ii) there
is no valid basis for any material Owned IP to be cancelled.
               (e) No material compulsory licenses have been granted for the
material Owned IP.
               (f) Except as would not, individually or in the aggregate,
materially impact the business or operations of Generation or a Project, or as
set forth in Section 3.12(f) of the Seller Disclosure Letter, (i) to the
Knowledge of Seller, the conduct of the respective businesses of Generation and
the Material Subsidiaries does not infringe or otherwise violate any Person’s
Intellectual Property, and there is no such claim pending or, to the Knowledge
of Seller, threatened against Generation or a Material

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Subsidiary, and (ii) to the Knowledge of Seller, no Person is infringing or
otherwise violating any Intellectual Property owned by Generation or a Material
Subsidiary and no such claims are pending or threatened against any Person by
Generation or a Material Subsidiary.
               (g) Each of Generation and the Material Subsidiaries owns all of
the rights and interests in and has title to, or has validly licensed to it, all
of the owned Intellectual Property free of any Lien, other than Permitted Liens.
          Section 3.13 Environmental Matters. Except as set forth in
Section 3.13 of the Seller Disclosure Letter:
               (a) Generation and the Material Subsidiaries are in compliance
with all applicable Environmental Laws, except for such noncompliance as would
not, individually or in the aggregate, materially impact the business or
operations of Generation or a Project;
               (b) Generation and the Material Subsidiaries have all of the
Environmental Permits required in order to conduct their operations or, where
such Environmental Permits have expired, have applied for a renewal of such
Environmental Permits in a timely fashion, except where the failure to have an
Environmental Permit or to have applied for a renewal of an Environmental Permit
would not, individually or in the aggregate, materially impact the business or
operations of Generation or a Project;
               (c) Generation and the Material Subsidiaries are in compliance
with the Environmental Permits issued to them, except for such non-compliance
that would not, individually or in the aggregate, materially impact the business
or operations of Generation or a Project;
               (d) there is no pending or threatened written Claim, lawsuit, or
administrative proceeding against Generation or the Material Subsidiaries under
or pursuant to any Environmental Law that would, individually or in the
aggregate, materially impact the business or operations of Generation or a
Project;
               (e) none of Generation or the Material Subsidiaries is a party or
subject to any administrative or judicial order, decree or other agreement with
a Governmental Authority under or pursuant to any applicable Environmental Law
that would, individually or in the aggregate, materially impact the business or
operations of Generation or a Project;
               (f) to the Knowledge of Seller, none of Generation or the
Material Subsidiaries have received written notice from any third party,
including any Governmental Authority, alleging that Generation or any Material
Subsidiary has been or is in violation or potentially in violation of any
applicable Environmental Law or otherwise may be liable under any applicable
Environmental Law, which violation or liability is unresolved and which,
individually or in the aggregate, would materially impact the business or
operations of Generation or a Project; and

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               (g) with respect to the real property that is currently owned or
leased by Generation or the Material Subsidiaries, there have been no spills or
discharges of Hazardous Substances on or underneath any such real property that,
individually or in the aggregate, would materially impact the business or
operations of Generation or a Project.
The representations and warranties set forth in this Section 3.13 are Seller’s
sole and exclusive representations and warranties related to environmental
matters.
          Section 3.14 Tax Matters. Except as set forth in Section 3.14 of the
Seller Disclosure Letter and, in the case of Takoradi, to the Knowledge of
Seller:
               (a) Each of Generation and the Material Subsidiaries and each
consolidated, combined, unitary, affiliated or aggregate group of which
Generation or any of the Material Subsidiaries is or was a member has timely
filed (or, in the case of Tax Returns due between the date hereof and the
Closing Date, will timely file) all Tax Returns that it was required to file
since January 1, 2002, except where the failure to timely file would not result
in a Tax cost in excess of $10,000. All such returns are correct and complete in
all material respects. All material Taxes owed by Generation or any of the
Material Subsidiaries have been paid (or, if due between the date hereof and the
Closing Date, will be timely paid). Neither Generation nor any of the Material
Subsidiaries currently is the beneficiary of any extension of time within which
to file any material Tax Return. No claim has ever been made by a taxing
authority in a jurisdiction where Generation or any of the Material Subsidiaries
does not file Tax Returns that it is or may be subject to taxation by that
jurisdiction. There are no security interests on any of the assets of Generation
or any of the Material Subsidiaries that arose in connection with any failure
(or alleged failure) to pay any material Tax.
               (b) Generation and each of the Material Subsidiaries has withheld
and paid all material Taxes required to have been withheld and paid in
connection with amounts paid or owing to any employee, former employee,
independent contractor, creditor, stockholder, affiliate, customer, supplier or
other third party.
               (c) There is no dispute or claim concerning any material Tax
liability of Generation or any of the Material Subsidiaries either claimed or
raised by any taxing authority in writing. Section 3.14 of the Seller Disclosure
Letter lists all United States federal, state, local and non-United States Tax
Returns with respect to Taxes determined by reference to net income filed with
respect to Generation and the Material Subsidiaries for any taxable period ended
on or after January 1, 2002, indicates those Tax Returns that have been audited
and indicates those Tax Returns that currently are the subject of audit.
               (d) Section 3.14 of the Seller Disclosure Letter sets out the
classification for United States federal income tax purposes of Generation and
each of the Material Subsidiaries.

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               (e) Each Material Subsidiary that is subject to VAT (or sales
tax) is registered for VAT, is a taxable person and has complied in all material
respects with the requirements of the Laws relating to VAT. All VAT returns and
payments due in respect of the VAT group of which the Material Subsidiaries are
members have been made.
               (f) All stamp, transfer and registration taxes have been paid in
respect of documents in the enforcement of which Generation or any Material
Subsidiary is interested.
               (g) Neither Generation nor any of the Generation U.S.
Subsidiaries at any time has engaged in any tax shelter, listed transaction or
reportable transaction within the meaning of Section 6011, Section 6111 or
Section 6112 of the Code and the Treasury Regulations thereunder, or in any
transaction that would be considered a tax shelter under comparable provisions
of state Tax law, except for those that have been disclosed on the applicable
U.S. federal income Tax Returns. Neither Generation nor any of the Material
Subsidiaries (i) has been a member of an affiliated group of corporations that
file a consolidated income Tax Return, other than the affiliated group of which
Energy is the common parent corporation, or (ii) has any liability for the Taxes
of any person other than itself under Section 1.1502-6 of the Treasury
Regulations (or any similar provision of state, local or foreign law), as a
transferee or successor, by contract or otherwise. Neither Generation nor any of
the Material Subsidiaries has extended or waived the application of any statute
of limitations of any jurisdiction regarding the assessment or collection of any
Tax.
          Section 3.15 Insurance.
               (a) Section 3.15(a) of the Seller Disclosure Letter sets forth a
true and complete list of all current policies of all material property and
casualty insurance, insuring the properties, assets, employees and/or operations
of Generation and the Material Subsidiaries (collectively, the “Policies”).
Premiums payable under such Policies have been paid in a timely manner and
Generation and the Material Subsidiaries, as applicable, have complied in all
material respects with the terms and conditions of all such Policies.
               (b) As of the date hereof, Seller has not received any written
notification of the failure of any of the Policies to be in full force and
effect. None of Generation or the Material Subsidiaries is in default under any
provision of the Policies, and except as set forth in Section 3.15(b) of the
Seller Disclosure Letter, there is no claim by Generation, the Material
Subsidiaries or any other Person pending under any of the Policies as to which
coverage has been denied or disputed by the underwriters or issuers thereof.
               (c) Each of the Policies is a valid binding agreement of Seller,
its Affiliates or the relevant Material Subsidiary and, except as set forth in
Section 3.15(c) of the Seller Disclosure Letter, to the Knowledge of Seller,
there is no reasonable basis for an insurer or reinsurer to void such Policies.

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               (d) Except as set forth in Section 3.15(d) of the Seller
Disclosure Letter, there are no current material claims outstanding under any
Policies.
          Section 3.16 Regulatory Matters. Seller (a) is not a “public utility”
and (b) is a “holding company” in a “holding company system” that includes a
“transmitting utility” or an “electric utility,” as each of the foregoing terms
is defined in the FPA, as amended, or the regulations of the FERC promulgated
thereunder.
          Section 3.17 Financial Statements.
               (a) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Jorf as of December 31, 2005, and the related
statements of income, shareholders’ equity, and cash flows for the year then
ended (the “Jorf Financial Statements”). The Jorf Financial Statements were
prepared, in all material respects, in accordance with GAAP and fairly present,
in all material respects, the financial position, results of operations and cash
flows of Jorf as of December 31, 2005 and for the periods covered thereby,
except as disclosed by the Jorf Financial Statements (or the notes thereto).
               (b) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Jubail as of December 31, 2005, and the related
statements of income, shareholders’ equity and cash flows for the year then
ended (the “Jubail Financial Statements”). The Jubail Financial Statements were
prepared, in all material respects, in accordance with GAAP and fairly present,
in all material respects, the financial position, results of operations and cash
flows of Jubail as of December 31, 2005 and for the periods covered thereby,
except as disclosed by the Jubail Financial Statements (or the notes thereto).
               (c) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Neyveli as of March 31, 2006, and the related
profit and loss account and cash flow statement for the year then ended (the
“Neyveli Financial Statements”). The Neyveli Financial Statements were prepared,
in all material respects, in accordance with GAAP and fairly present, in all
material respects, the financial position, results of operations and cash flows
of Neyveli as of March 31, 2006 and for the periods covered thereby, except as
disclosed by the Neyveli Financial Statements (or the notes thereto).
               (d) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Takoradi as of December 31, 2005, and the related
statements of income and cash flows for the year then ended (the “Takoradi
Financial Statements”). The Takoradi Financial Statements were prepared, in all
material respects, in accordance with GAAP and fairly present, in all material
respects, the financial position, results of operations and cash flows of
Takoradi as of December 31, 2005 and for the periods covered thereby, except as
disclosed by the Takoradi Financial Statements (or the notes thereto).

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               (e) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Shuweihat CMS International Power Company PJSC as
of December 31, 2005, and the related statements of income, shareholders’
equity, and cash flows for the year then ended (the “Shuweihat Financial
Statements”). The Shuweihat Financial Statements were prepared, in all material
respects, in accordance with GAAP and fairly present, in all material respects,
the financial position, results of operations and cash flows of Shuweihat CMS
International Power Company PJSC as of December 31, 2005 and for the periods
covered thereby, except as disclosed by the Shuweihat Financial Statements (or
the notes thereto).
               (f) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Taweelah as of December 31, 2005, and the related
statements of income, shareholders’ equity and cash flows for the year then
ended (the “Taweelah Financial Statements”). The Taweelah Financial Statements
were prepared, in all material respects, in accordance with GAAP and fairly
present, in all material respects, the financial position, results of operations
and cash flows of Emirates CMS Power Company PJSC as of December 31, 2005 and
for the periods covered thereby, except as disclosed by the Taweelah Financial
Statements (or the notes thereto).
               (g) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of CMS Energy (UK) Limited as of December 31, 2004,
and the related profit and loss account for the year then ended (the “UK
Financial Statements”). The UK Financial Statements were prepared, in all
material respects, in accordance with GAAP and fairly present, in all material
respects, the financial position, results of operations and cash flows of CMS
Energy (UK) Limited as of December 31, 2004 and for the periods covered thereby,
except as disclosed by the UK Financial Statements (or the notes thereto).
               (h) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Jorf Lasfar Handelsbolag as of December 31, 2005,
and the related statements of income, shareholders’ equity, and cash flows for
the year then ended (the “JLH Financial Statements”). The JLH Financial
Statements were prepared, in all material respects, in accordance with GAAP and
fairly present, in all material respects, the financial position, results of
operations and cash flows of Jorf Lasfar Handelsbolag as of December 31, 2005
and for the periods covered thereby, except as disclosed by the JLH Financial
Statements (or the notes thereto).
               (i) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Jorf Lasfar Energiaktiebolag as of December 31,
2005, and the related statements of income, shareholders’ equity, and cash flows
for the year then ended (the “JLE Financial Statements”). The JLE Financial
Statements were prepared, in all material respects, in accordance with GAAP and
fairly present, in all material respects, the financial position, results of
operations and cash flows of Jorf Lasfar Energiaktiebolag as of December 31,
2005 and for the periods covered thereby, except as disclosed by the JLE
Financial Statements (or the notes thereto).

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               (j) Prior to the date hereof, Seller has made available to Buyer
the audited balance sheet of Jorf Lasfar Power Energy Aktiebolag as of
December 31, 2005, and the related statements of income, shareholders’ equity,
and cash flows for the year then ended (the “JLPE Financial Statements”). The
JLPE Financial Statements were prepared, in all material respects, in accordance
with GAAP and fairly present, in all material respects, the financial position,
results of operations and cash flows of Jorf Lasfar Power Energy Aktiebolag as
of December 31, 2005 and for the periods covered thereby, except as disclosed by
the JLPE Financial Statements (or the notes thereto).
               (k) Prior to Closing, Seller will make available to Buyer each of
the 2006 Financial Statements, to the extent provided pursuant to Section 5.19.
Each of the 2006 Financial Statements will be prepared, in all material
respects, in accordance with GAAP and fairly present, in all material respects,
the financial position, results of operations and cash flows of the relevant
Material Subsidiary, as of the date of such 2006 Financial Statements and for
the periods covered thereby, except as disclosed by such 2006 Financial
Statements.
          Section 3.18 Absence of Certain Changes or Events.
               (a) Except as set forth in Section 3.18(a) of the Seller
Disclosure Letter, since December 31, 2005, Generation and the Material
Subsidiaries have conducted their respective businesses in the ordinary course
of business, consistent with past practice in all material respects.
               (b) Except as set forth in Section 3.18(b) of the Seller
Disclosure Letter, or in the financial statements of Generation or the Material
Subsidiaries, and the notes thereto, since December 31, 2005, there has not been
with respect to Generation or any Material Subsidiary, any event or development
or change which has resulted or would reasonably be likely to result in a
material adverse effect.
               (c) Section 3.18(c) of the Seller Disclosure Letter sets forth a
true and complete list of the Distributions since the date of the last audited
financial statement for each Material Subsidiary, as applicable.
          Section 3.19 Absence of Undisclosed Liabilities. None of Generation or
the Material Subsidiaries has any Liabilities (whether absolute, accrued,
contingent or otherwise) that are required by GAAP to be reflected in the
financial statements of Generation or the Material Subsidiaries, except those
Liabilities (a) disclosed and reserved against in the financial statements of
Generation or the Material Subsidiaries (or notes thereto), (b) set forth in
Section 3.19 of the Seller Disclosure Letter, (c) incurred in the ordinary
course of business since December 31, 2005 or (d) which would not result in a
material adverse effect.
          Section 3.20 Brokerage and Finders’ Fees. None of Seller, Generation
or a Material Subsidiary, or any of their Affiliates or their respective
stockholders, partners, directors, officers or employees, has incurred or will
incur any brokerage, finders’ or

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similar fee in connection with the transactions contemplated by this Agreement,
the Related Agreements, the CGIC Loan Agreement or the Consent and Support
Agreement.
          Section 3.21 Affiliated Transactions. Except as described in
Section 3.21 of the Seller Disclosure Letter, and except for trade payables and
receivables arising in the ordinary course of business for purchases and sales
of goods or services consistent with past practice, none of Generation or the
Material Subsidiaries has been a party over the past twelve (12) months to any
Material Contract with Seller or any Affiliate of Seller (other than Generation
or the Material Subsidiaries) and no director or officer of Seller or its
Affiliates (other than Generation or the Material Subsidiaries), has, directly
or indirectly, any material interest in any of the assets or properties of
Generation or a Material Subsidiary.
          Section 3.22 No Insolvency.
               (a) There has not been, with respect to any of Generation or a
Material Subsidiary (i) any decree, judgment or order by a court of competent
jurisdiction entered adjudging Generation or a Material Subsidiary as bankrupt
or insolvent, or ordering relief against Generation or a Material Subsidiary in
response to the commencement of an involuntary bankruptcy case, or approving as
properly filed a petition seeking reorganization or liquidation of Generation or
a Material Subsidiary under any Applicable Law or (ii) any decree, judgment or
order of a court of competent jurisdiction entered with respect to the
appointment of a receiver, liquidator, trustee or assignee in bankruptcy or
insolvency of Generation or a Material Subsidiary, or of the property of, or for
the winding up or liquidation of the affairs of Generation or a Material
Subsidiary.
               (b) Generation or a Material Subsidiary has not (i) instituted a
voluntary bankruptcy proceeding, (ii) consented to the filing of a bankruptcy
proceeding against it, (iii) filed a petition or answer or consent seeking
reorganization or liquidation under any Applicable Law or similar statute or
consented to the filing of any such petition, (iv) consented to the appointment
of a custodian, receiver, liquidator, trustee or assignee in bankruptcy or
insolvency of it or any of its assets or property, (v) made a general assignment
for the benefit of creditors, (vi) admitted in writing its inability to pay its
debts generally as they become due, (vii) within the meaning of any Applicable
Law, become insolvent or failed generally to pay its debts as they become due,
or (viii) taken any corporate or other action in furtherance of or to
facilitate, conditionally or otherwise, any of the foregoing.
          Section 3.23 No Other Representations or Warranties. Except for the
representations and warranties contained in this Article III, none of Seller,
Generation or the Material Subsidiaries, nor any other Person makes any other
express or implied representation or warranty on behalf of Seller.

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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
     Except as set forth in the letter delivered by Buyer to Seller on the date
hereof (the “Buyer Disclosure Letter”), Buyer hereby represents and warrants to
Seller as follows:
          Section 4.1 Corporate Organization; Qualification. Buyer (a) is duly
incorporated, validly existing and in good standing under the Laws of its
jurisdiction of incorporation, (b) has the requisite power to carry on its
businesses as currently conducted and (c) is duly qualified to do business in
each of the jurisdictions in which the ownership, operation or leasing of its
properties or assets or the conduct of its business requires it to be so
qualified, except where the failure to be so qualified would not adversely
affect the ability of, or timing for, Buyer to consummate the transactions
contemplated by this Agreement, the Related Agreements, the CGIC Loan Agreement
or the Consent and Support Agreement.
          Section 4.2 Authority Relative to this Agreement. Buyer has full
corporate, or other power, and authority to execute and deliver this Agreement,
the Related Agreements, the CGIC Loan Agreement, the Consent and Support
Agreement and the other agreements, documents and instruments to be executed and
delivered by it in connection with this Agreement, the Related Agreements, the
CGIC Loan Agreement or the Consent and Support Agreement, and to consummate the
transactions contemplated hereby and thereby. The execution, delivery and
performance of this Agreement, the Related Agreements, the CGIC Loan Agreement,
the Consent and Support Agreement and the other agreements, documents and
instruments to be executed and delivered by Buyer in connection with this
Agreement, the Related Agreements, the CGIC Loan Agreement or the Consent and
Support Agreement and the consummation of the transactions contemplated hereby
and thereby have been duly and validly authorized by all the necessary action on
the part of Buyer, and no other corporate, or other proceedings on the part of
Buyer, are necessary to authorize this Agreement, the Related Agreements, the
CGIC Loan Agreement, the Consent and Support Agreement and the other agreements,
documents and instruments to be executed and delivered by Buyer in connection
with this Agreement. the Related Agreements, the CGIC Loan Agreement or the
Consent and Support Agreement or to consummate the transactions contemplated
hereby and thereby. This Agreement and the Consent and Support Agreement have
been, and the Related Agreements, the CGIC Loan Agreement and the other
agreements, documents and instruments to be executed and delivered by Buyer in
connection with this Agreement, the Related Agreements, the CGIC Loan Agreement
or the Consent and Support Agreement as of or prior to the Closing Date will be,
duly and validly executed and delivered by Buyer and assuming that this
Agreement, the Related Agreements, the CGIC Loan Agreement, the Consent and
Support Agreement and the other agreements, documents and instruments to be
executed and delivered by Buyer in connection with this Agreement, the Related
Agreements, the CGIC Loan Agreement or the Consent and Support Agreement
constitute legal, valid and binding agreements of Seller are (in the case of
this Agreement and the Consent and Support Agreement) or will be as of the
Closing Date (in the case of the Related Agreements, the CGIC Loan Agreement and
the

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other agreements, documents and instruments to be executed and delivered on or
prior to the Closing Date in connection with this Agreement, the Related
Agreements, the CGIC Loan Agreement or the Consent and Support Agreement),
enforceable against Buyer in accordance with their respective terms, except that
such enforceability may be limited by applicable bankruptcy, insolvency,
moratorium or other similar laws affecting or relating to enforcement of
creditors’ rights generally or general principles of equity.
          Section 4.3 Consents and Approvals. Except as set forth in Section 4.3
of the Buyer Disclosure Letter, Buyer requires no consent, approval or
authorization of, or filing, registration or qualification with, any
Governmental Authority, or any other Person as a condition to the execution and
delivery of this Agreement or the performance of its obligations hereunder,
except where the failure to obtain such consent, approval or authorization of,
or filing of, registration or qualification with, any Governmental Authority, or
any other Person would not adversely affect the ability of, or timing for, Buyer
to consummate the transactions contemplated by this Agreement, the Related
Agreements, the CGIC Loan Agreement or the Consent and Support Agreement.
          Section 4.4 No Conflict or Violation. Except as set forth in
Section 4.4 of the Buyer Disclosure Letter, the execution, delivery and
performance by Buyer of this Agreement do not:
               (a) violate or conflict with any provision of the organizational
documents or bylaws of Buyer;
               (b) violate any applicable provision of a law, statute, judgment,
order, writ, injunction, decree, award, rule or regulation of any Governmental
Authority, except where such violation would not adversely affect the ability
of, or timing for, Buyer to consummate the transactions contemplated by this
Agreement, the Related Agreements, the CGIC Loan Agreement or the Consent and
Support Agreement; or
               (c) violate, result in a breach of, constitute (with due notice
or lapse of time or both) a default or cause any material obligation, penalty or
premium to arise or accrue under any material contract, lease, loan, agreement,
mortgage, security agreement, trust indenture or other material agreement or
instrument to which Buyer is a party or by which it is bound or to which any of
its properties or assets is subject, except as would not adversely affect the
ability of, or timing for, Buyer to consummate the transactions contemplated by
this Agreement, the Related Agreements, the CGIC Loan Agreement or the Consent
and Support Agreement.
          Section 4.5 Litigation. Except as set forth in Section 4.5 of the
Buyer Disclosure Letter, there are no lawsuits, actions, proceedings pending or,
to knowledge of Buyer, threatened, against Buyer or any of its Affiliates or any
executive officer or director thereof which would prohibit or impair Buyer or
its Affiliates from undertaking any of the transactions contemplated by this
Agreement, the Related Agreements, the CGIC Loan Agreement or the Consent and
Support Agreement, except as would not materially affect the consummation of the
transactions contemplated by this Agreement. Buyer and its Affiliates are not
subject to any outstanding judgment, order, writ,

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injunction, decree or award entered in an Action to which Buyer or any of its
Affiliates was a named party which would prohibit or impair Buyer or its
Affiliates from undertaking any of the transactions contemplated by this
Agreement, the Related Agreements, the CGIC Loan Agreement or the Consent and
Support Agreement, except as would not adversely affect the ability of, or
timing for, Buyer to consummate the transactions contemplated by this Agreement,
the Related Agreements, the CGIC Loan Agreement or the Consent and Support
Agreement.
          Section 4.6 Availability of Funds. Buyer has and will have on the
Closing Date sufficient funds available in immediately available funds to pay
the Purchase Price and to consummate the transactions contemplated hereby. The
ability of Buyer to consummate the transactions contemplated hereby is not
subject to any condition or contingency with respect to financing.
          Section 4.7 Brokerage and Finders’ Fees. Neither Buyer nor any of its
Affiliates, or their respective stockholders, partners, directors, officers or
employees, has incurred or will incur any brokerage, finders’ or similar fee in
connection with the transactions contemplated by this Agreement, the Related
Agreements, the CGIC Loan Agreement or the Consent and Support Agreement.
          Section 4.8 Investment Representations.
               (a) Buyer is acquiring the Generation Interests to be acquired by
it hereunder for its own account, solely for the purpose of investment and not
with a view to, or for sale in connection with, any distribution thereof in
violation of the federal securities laws or any applicable foreign or state
securities law.
               (b) Buyer is an “accredited investor” as defined in Rule 501(a)
promulgated under the Securities Act of 1933, as amended.
               (c) Buyer understands that the acquisition of the Generation
Interests to be acquired by it pursuant to the terms of this Agreement involves
substantial risk. Buyer and its officers have experience as an investor in
securities and equity interests of companies such as the ones being transferred
pursuant to this Agreement and Buyer acknowledges that it can bear the economic
risk of its investment and have such knowledge and experience in financial or
business matters that Buyer is capable of evaluating the merits and risks of its
investment in the Generation Interests to be acquired by it pursuant to the
transactions contemplated hereby.
               (d) Buyer understands that the Generation Interests to be
acquired by it hereunder have not been registered under the Securities Act on
the basis that the sale provided for in this Agreement is exempt from the
registration provisions thereof. Buyer acknowledges that such securities may not
be transferred or sold except pursuant to the registration and other provisions
of applicable securities laws or pursuant to an applicable exemption therefrom.

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               (e) Buyer acknowledges that the offer and sale of the Generation
Interests to be acquired by it in the transactions contemplated hereby have not
been accomplished by the publication of any advertisement.
          Section 4.9 Regulation Matters. Buyer is not (a) “public utility,” or
(b) (i) a “holding company,” or (ii) a “holding company” in a “holding company
system” that includes a “transmitting utility” or an “electric utility,” as each
of the foregoing terms is defined in the FPA, as amended, or the regulations of
the FERC promulgated thereunder.
          Section 4.10 No Other Representations or Warranties. Except for the
representations and warranties contained in this Article IV, neither Buyer nor
any other Person makes any other express or implied representation or warranty
on behalf of Buyer.
ARTICLE V
COVENANTS OF THE PARTIES
          Section 5.1 Conduct of Business
               (a) Except as expressly provided in this Agreement or as set
forth in Section 5.1(a) of the Seller Disclosure Letter, from and after the date
of this Agreement and until the Closing Date, Seller shall cause Generation and
the Material Subsidiaries to conduct and maintain their respective businesses in
the ordinary course of business, consistent with past practice.
               (b) Except as contemplated by this Agreement or as set forth in
Section 5.1(b) of the Seller Disclosure Letter, from and after the date of this
Agreement and prior to the Closing Date, without the prior written consent of
Buyer (which consent shall not be unreasonably withheld, delayed or
conditioned), Seller shall cause each of Generation and the Material
Subsidiaries not to:
               (i) amend its charter or organizational documents or merge with
or into or consolidate with any other Person;
               (ii) issue, sell, pledge, dispose of or encumber, or authorize or
propose the issuance, sale, pledge, disposition or encumbrance of, any shares
of, or securities convertible or exchangeable for, or options, puts, warrants,
calls, commitments or rights of any kind to acquire, any of its capital stock or
other membership or ownership interests or subdivide or in any way reclassify
any shares of its capital stock or other membership or ownership interests or
change or agree to change in any manner the rights of its outstanding capital
stock or other membership or ownership interests;
               (iii) (A) split, combine or reclassify any shares of any class or
series of capital stock or other equity interest of Generation or the Material
Subsidiaries; or (B) redeem, purchase or otherwise acquire directly or
indirectly any shares of any class or series of capital stock or other equity
interests of Generation or the Material Subsidiaries, or any

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instrument or security which consists of or includes a right to acquire such
shares or interests;
               (iv) except as may be required by agreements or arrangements
currently in effect, grant any severance or termination pay to, or enter into,
extend or amend any employment, consulting, severance or other compensation
agreement with, or otherwise increase the compensation or benefits provided to
any of its officers or other employees whose annual salary base is in excess of
$150,000, other than in the ordinary course of business, consistent with past
practice, or agreements, the liability for which shall be borne by Seller;
               (v) terminate the employment of or dismiss any Employee who is
entitled to a base salary in excess of $200,000 per annum (“Senior Employee”);
               (vi) employ or agree to employ any new persons fully or part time
at the Material Subsidiaries where the total staff costs of the business of the
Material Subsidiaries would be increased in the aggregate by more than five
percent (5%) per annum;
               (vii) sell, lease, license, mortgage or otherwise dispose of any
properties or assets material to its business, other than (A) sales made in the
ordinary course of business consistent with past practice or (B) sales of
obsolete or other assets not presently utilized in its business;
               (viii) make any change in its material accounting principles,
practices or methods, other than as may be required by GAAP, Applicable Law or
any Governmental Authority;
               (ix) organize any new Subsidiary or acquire any capital stock of,
or equity or ownership interest in, any other Person;
               (x) enter into, materially modify or amend or terminate any
Material Contract or waive, release or assign any material rights or Claims
under a Material Contract, except in the ordinary course of business consistent
with past practice;
               (xi) make any capital expenditure in excess of ten percent (10%)
of the budgeted capital expenditures set forth in Section 5.1(b)(xi) of the
Seller Disclosure Letter for Generation or such Material Subsidiary other than
as required by an emergency or a force majeure event;
               (xii) pay, repurchase, discharge or satisfy any of its material
Claims, Liabilities or obligations (absolute, accrued, asserted

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or unasserted, contingent or otherwise), other than in the ordinary course of
business and consistent with past practice;
               (xiii) enter into any new Contract with Seller or its Affiliates
(other than Generation or a Material Subsidiary), except for any such Contracts
in the ordinary course of business consistent with past practice or Contracts
terminable on not more than 60 days’ notice;
               (xiv) except for non-material routine claims incidental to the
business of Generation and the Material Subsidiaries, compromise or settle
litigation or arbitration proceedings or any action, demand or dispute or waive
a right in relation to litigation or arbitration proceedings, other than
settlements requiring payments in the aggregate of less than $1,000,000 or for
which Seller is obligated to indemnify Buyer pursuant to Section 8.2(a)(iv)
hereof;
               (xv) merge or amalgamate Generation or a Material Subsidiary with
or into any other body corporate or effect any restructuring of Generation or a
Material Subsidiary, other than the Reorganization and Merger;
               (xvi) present any petition, apply for any order or pass any
resolution for the winding up of Generation or a Material Subsidiary or for the
appointment of a liquidator or provisional liquidator to, or an administrator in
respect of, Generation or a Material Subsidiary, appoint a receiver over the
whole or part of Generation or a Material Subsidiary’s business or assets;
propose any voluntary arrangement with any of the creditors of Generation or a
Material Subsidiary, agree to a composition, compromise, assignment or
arrangement with any of creditors of Generation or a Material Subsidiary;
               (xvii) cancel, modify in any material respect, revoke, suspend or
fail to renew any Permit, except to the extent a reasonable and prudent operator
would take or fail to take such actions;
               (xviii) permit any asset of Generation or a Material Subsidiary
to be subjected to any Lien, other than Permitted Liens and Liens that will be
released at or prior to Closing;
               (xix) make any election or exercise any discretion in connection
with any Plan outside the ordinary course of business;
               (xx) make available any Indebtedness to any other Person other
than Generation or a Material Subsidiary) in excess of $100,000 to any Person or
in excess of $1,000,000 in the aggregate;
               (xxi) except in connection with the prepayment of certain CMS
Generation Investment Company IV Indebtedness using the

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proceeds of the CGIC Loan Agreement, make any voluntary prepayment of
Indebtedness to an unaffiliated third party under any financing agreement;
               (xxii) enter into any contract or transaction relating to the
purchase of material assets other than in the ordinary course of business
consistent with past practice;
               (xxiii) (A) incur or assume any Indebtedness (other than
Indebtedness owed to Generation or a Material Subsidiary and any Indebtedness
incurred pursuant to Section 5.4 hereof); (B) modify the terms of any
Indebtedness, other than modifications of short-term debt in the ordinary course
of business, consistent with past practice; or (C) assume, guarantee, endorse or
otherwise become liable or responsible (whether directly, contingently or
otherwise) for the material obligations of any other Person;
               (xxiv) adopt a plan of complete or partial liquidation,
dissolution, restructuring, recapitalization or other reorganization;
               (xxv) enter into any commitments to pursue new development
projects;
               (xxvi) except as otherwise provided in Sections 5.15 and 5.16,
make or change any election for Tax purposes, change an annual accounting period
for Tax purposes, file any amended Tax Return, enter into any closing agreement
for Tax purposes, settle any Tax claim or assessment relating to Generation or
any of the Material Subsidiaries, surrender any right to claim a refund of
Taxes, consent to any extension or waiver of the limitation period applicable to
any Tax claim or assessment relating to Generation or any of the Material
Subsidiaries, or take any other action relating to the filing of any Tax Return
or the payment of any Tax, if such election, adoption, change, amendment,
agreement, settlement, surrender, consent or other action would have the effect
of increasing the Tax liability of Generation or any of the Material
Subsidiaries for any period ending after the Closing Date or decreasing any Tax
attribute of Generation or any of the Material Subsidiaries existing on the
Closing Date; or
               (xxvii) authorize any of, or commit or agree to take any of, the
actions referred to in the paragraphs (i) through (xxvi) above.
For purposes of U.S. dollar amounts set forth in this Section 5.1(b), amounts
will be interpreted to include the equivalent thereof in foreign currency based
on then current foreign exchange rates.

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               (c) Except as contemplated by this Agreement, from and after the
date hereof and prior to the Closing Date, without the prior written consent of
Buyer (which consent shall not be unreasonably withheld, delayed or
conditioned), Seller shall cause Generation not to make or permit any
Distribution.
          Section 5.2 Access to Properties and Records.
               (a) Subject to Applicable Law and any applicable restrictions as
to confidentiality, Seller shall use its reasonable best efforts to afford to
Buyer and Buyer’s accountants, counsel and representatives reasonable access
during normal business hours throughout the period prior to the Closing Date (or
the earlier termination of this Agreement pursuant to Article VII hereof) to all
of the properties, books, contracts, commitments, records (including all
environmental studies, reports and other environmental records) and personnel of
Generation and the Material Subsidiaries and, during such period, shall furnish
to Buyer all information concerning the respective businesses, properties,
Liabilities and personnel of Generation and the Material Subsidiaries as Buyer
may request; provided, however, that Seller shall not be required to furnish or
make available any such materials to the extent that they are subject to a legal
privilege that, in the good faith judgment of Seller, may be lost or impaired by
virtue of such disclosure. At the Closing, all of the books of accounts, minute
books, record books and other records (including safety, health, environmental,
maintenance and engineering records and drawings) pertaining to the business
operations of Generation and the Material Subsidiaries shall be delivered to
Buyer to the extent such materials are in Seller’s possession. Notwithstanding
anything to the contrary herein, Buyer and its representatives shall not have
the right to conduct any Phase II environmental due diligence, including the
collection and analysis of any samples of environmental media or building
materials.
               (b) The information contained herein and in the Seller Disclosure
Letter, reviewed by Buyer or its representatives pursuant to Section 5.2(a) or
heretofore or hereafter delivered to Buyer or its representatives in connection
with the transactions contemplated by this Agreement shall be held in confidence
by Buyer and its representatives in accordance with the terms of the
Confidentiality Agreement.
          Section 5.3 Consents and Approvals.
               (a) Upon the terms and subject to the conditions of this
Agreement, each of the parties hereto agrees to use, and will cause its
respective Affiliates to use, its reasonable best efforts to take, or cause to
be taken, all actions, and to do, or cause to be done, all things necessary or
advisable under Applicable Law and regulations to consummate and make effective
the transactions contemplated by this Agreement as promptly as practicable
including the preparation and filing of all forms, registrations and notices
required to be filed by such party in order to consummate the transactions
contemplated by this Agreement, the taking of all appropriate action necessary,
proper or advisable to satisfy each of the conditions to Closing that are to be
satisfied by that party or any of its Affiliates and the taking of such actions
as are necessary to obtain any approvals, consents, orders, exemptions or
waivers of

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Governmental Authorities required to be obtained by such party in order to
consummate the transactions contemplated by this Agreement. Each party shall
promptly consult with the other with respect to, provide any necessary
information with respect to, and provide copies of all filings made by such
party with any Governmental Authority or any other information supplied by such
party to a Governmental Authority in connection with, this Agreement and the
Related Agreements and the transactions contemplated hereby and thereby.
               (b) Without limiting the generality of the undertakings pursuant
to this Section 5.3, each of Seller and Buyer shall use its reasonable best
efforts to take, or cause to be taken, all action and to do, or cause to be
done, all things necessary under the Competition Laws to consummate and make
effective the transactions contemplated by this Agreement and the Related
Agreements, including furnishing all information required by applicable law in
connection with approvals of or filings with any Governmental Authority,
including filing, or causing to be filed, as promptly as practicable, any
required notification and report forms under other applicable Competition Laws
with the applicable non-U.S. Governmental Antitrust Authority. The parties shall
consult with each other as to the appropriate time of filing such notifications
and shall agree upon the timing of such filings. All filing fees under any
applicable Competition Law shall be borne by the party responsible for making
such filing, and each party will bear its own costs for the preparation of any
such filing. Each party shall (i) respond promptly to any request for additional
information made by the antitrust agency; (ii) promptly notify the other party
of, and if in writing, furnish the other party with copies of (or, in the case
of material oral communications, advise the other party orally of) any
communications from or with the antitrust agency in connection with any of the
transactions contemplated by this Agreement; (iii) not participate in any
meeting with the antitrust agency unless it consults with the other party in
advance and to the extent permitted by the agency gives the other party the
opportunity to attend and participate thereat; (iv) furnish the other party with
copies of all correspondence, filings and communications (and memoranda setting
forth the substance thereof) between it and the antitrust agency with respect to
any of the transactions contemplated by this Agreement; and (v) furnish the
other party with such necessary information and reasonable assistance as may be
reasonably necessary in connection with the preparation of necessary filings or
submission of information to the antitrust agency and consistent with
appropriate confidentiality safeguards. The Parties shall use their reasonable
best efforts to cause the waiting periods under the applicable Competitions Laws
to terminate or expire at the earliest possible date after the date of filing.
               (c) If any objections are asserted with respect to the
transactions contemplated by this Agreement, the Related Agreements, the CGIC
Loan Agreement or the Consent and Support Agreement under any Competition Law or
if any suit or proceeding is instituted or threatened by any Governmental
Authority or any private party challenging any of the transactions contemplated
by this Agreement, the Related Agreements, the CGIC Loan Agreement or the
Consent and Support Agreement as violative of any Competition Law, each of
Seller and Buyer shall use its best efforts to promptly resolve such objections;
provided, however, that notwithstanding anything to the contrary in this
Agreement, none of Seller or Buyer or any of their respective

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Affiliates shall have any obligation to hold separate or divest any property or
assets of Seller or Buyer, or any of their respective Affiliates, or to defend
against any lawsuit, action or proceeding, judicial or administrative,
challenging this Agreement, any Related Agreement, the CGIC Loan Agreement or
the Consent and Support Agreement or the transactions contemplated hereby or
thereby.
          Section 5.4 Certain Subsidiary Level Debt.
               (a) Prior to Closing, Buyer shall use its reasonable best efforts
to effect the prepayment in full by CMS Generation Investment Company IV of the
debt set forth in Section 5.4(a) of the Seller Disclosure Letter (the
“Schedule 5.4(a) Debt”) (including through entry into and draw down under the
CGIC Loan Agreement). Seller shall use its reasonable best efforts to cooperate
and assist Buyer in obtaining the approvals and consents necessary for the
prepayment of the Schedule 5.4(a) Debt and Seller and Buyer shall use their
reasonable best efforts to negotiate and enter into any documentation necessary
in connection with the CGIC Loan Agreement.
               (b) Prior to Closing (beginning immediately following the
execution of this Agreement), Seller and Buyer shall use their reasonable best
efforts in obtaining from the lenders of Jorf, relevant Governmental Authorities
and other third parties the approvals and consents listed in Section 6.3(d) of
the Seller Disclosure Letter under the headings “Governmental consents” and
“Jorf consents” and all other required approvals and consents of any
Governmental Authority or other third party in relation to the debt set forth in
Section 5.4(b) of the Seller Disclosure Letter (the “Schedule 5.4(b) Debt”)
(without prejudice to the continuing obligations of Seller and Buyer under
Section 5.4(c)).
               (c) Prior to Closing (beginning immediately following the
execution of this Agreement), Seller and Buyer shall use their reasonable best
efforts to prepare all documentation and obtain all consents necessary to effect
the refinancing contemplated by the term sheet attached hereto as Exhibit G (the
“JLEC Refinancing”) (without prejudice to the continuing obligations of Seller
and Buyer under Section 5.4(b)). If the consents and approvals required pursuant
to Section 5.4(b) have not been obtained prior to March 10, 2007, Seller and
Buyer (including in its capacity as an indirect equity holder in Jorf and
Neyveli) shall use their reasonable best efforts to effect the JLEC Refinancing
on May 15, 2007 (or, if such day is not a Business Day as defined in the Jorf
Common Agreement, on the next or preceding Business Day in accordance with the
Jorf Common Agreement), in accordance with the term sheet attached hereto as
Exhibit G, including, without limitation, entering into any necessary
documentation related thereto and using reasonable best efforts to take all
actions reflected in such term sheet by the dates specified therein (without
prejudice to the continuing obligations of Seller and Buyer under
Section 5.4(b)); provided, however, that Buyer will not be required to effect
the JLEC Refinancing if the consents and approvals required pursuant to
Section 5.4(b) are obtained prior to 11:59 p.m. (New York City time) on
April 12, 2007 (or, if such day is not a Business Day as defined in the Jorf
Common Agreement, on the next or preceding Business Day in accordance with the
Jorf Common Agreement) (the “Prepayment Notice Date”). Seller shall use its
reasonable best efforts to cooperate

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and assist Buyer in obtaining the approvals and consents necessary for the
prepayment of the Schedule 5.4(b) Debt.
          Section 5.5 Further Assurances. On and after the Closing Date, Seller
and Buyer shall cooperate and use their respective reasonable best efforts to
take or cause to be taken all appropriate actions and do, or cause to be done,
all things necessary or appropriate to consummate and make effective the
transactions contemplated hereby as soon as reasonably possible following the
date hereof, including the execution of any additional documents or instruments
of any kind, the obtaining of consents which may be reasonably necessary or
appropriate to carry out any of the provisions hereof and the taking of all such
other actions as such party may reasonably be requested to take by the other
party hereto from time to time, consistent with the terms of this Agreement and
the Related Agreements, to effectuate the provisions and purposes of this
Agreement and the Related Agreements and the transactions contemplated hereby
and thereby.
          Section 5.6 Employee Matters.
               (a) Not less than thirty (30) Business Days prior to the Closing
Date, Buyer may offer employment, commencing as of the Closing Date, to such
individuals identified on Section 5.6(a) of the Seller Disclosure Letter (the
“Schedule 5.6(a) Employees”) as it may determine in its discretion. Buyer shall
take all steps necessary to ensure that its hiring decisions and practices in
this regard are in accordance with Applicable Law. Not fewer than twenty
(20) Business Days prior to the Closing Date, Buyer shall notify Seller of the
Schedule 5.6(a) Employees who have accepted Buyer’s offer of employment. After
the date hereof and prior to the Closing Date, Seller shall provide Buyer with
access, during reasonable business hours and upon reasonable notice, to the
Schedule 5.6(a) Employees, and Buyer agrees that it shall use its best efforts
to conduct its hiring process, during reasonable business hours and upon
reasonable notice, in a manner that causes minimum disruption to the operations
of Seller. Each of the Schedule 5.6(a) Employees who commences employment with
Buyer effective as of (or who is on approved leave of absence on) the Closing
Date, together with the continuing employees of the Material Subsidiaries, shall
be referred to herein as “Transferred Employees,” and each Schedule 5.6(a)
Employee who is not a Transferred Employee shall be referred to herein as a
“Non-Hired Employee.”
               (b) Following the Closing for a period of one (1) year, none of
Buyer, Generation or their Affiliates shall hire in any capacity (whether as an
employee, consultant, independent contractor or otherwise) any Non-Hired
Employee who has been terminated by, and received severance compensation from,
Seller unless and until Buyer reimburses Seller for a reasonable portion of such
severance compensation.
               (c) Following the Closing for a period of one (1) year, none of
Buyer, Generation or their Affiliates shall directly or indirectly solicit the
employment or services of, or hire in any capacity (whether as an employee,
consultant, independent contractor or otherwise) any employee (i) of Seller or
its Affiliates who is not a Schedule 5.6(a) Employee or (ii) of Energy or its
Affiliates without the prior written consent of Seller, which may not be
unreasonably withheld, conditioned or delayed absent

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significant business rationale for Seller to retain such employee for a
reasonable time and purpose.
               (d) Buyer, Generation and the Subsidiaries of Generation shall be
responsible for all Liabilities and obligations under the Worker Adjustment and
Retraining Notification Act and similar foreign, state and local rules, statutes
and ordinances resulting from the actions of Buyer, Generation and the
Subsidiaries of Generation after the Closing Date. Buyer agrees to indemnify
Seller and to defend and hold Seller harmless for any breach of such
responsibility and Buyer’s indemnification of Seller in this regard specifically
includes any Claim by any of the Transferred Employees for back pay, front pay,
benefits or compensatory or punitive damages, any Claim by any Governmental
Authority for penalties regarding any issue of prior notification (or lack
thereof) of any plant closing or mass layoff occurring after the Closing Date
and Seller’s costs, including reasonable attorney’s fees, in defending any such
Claims.
               (e) Buyer and Seller shall cooperate as reasonably necessary to
implement the provisions of this Section 5.6 and agree to provide each other
with such records and information as may be necessary and appropriate to carry
out their respective obligations under this Section 5.6.
          Section 5.7 Tax Covenants.
               (a) Section 338(g) Elections. Buyer shall not make any election
under Section 338(g) of the Code (or any analogous provision of state, local, or
foreign income tax law) with respect to the deemed purchase of the equity
interests of any Generation Non-U.S. Subsidiary.
               (b) Section 338(h)(10) Elections.
               (i) Seller and Buyer shall jointly make elections under
Section 338(h)(10) of the Code (and any comparable provision of applicable state
or local income tax law) with respect to the deemed purchase of the equity
interests of each Generation U.S. Subsidiary that constitutes a corporation
(within the meaning of Section 7701(a)(3) of the Code) as shown in Section 5.15
of the Seller Disclosure Letter, pursuant to this Agreement and shall cooperate
with each other to take all reasonable actions necessary and appropriate
(including filing such additional forms, returns, elections schedules and other
documents as may be required) to effect and preserve such timely elections, in
accordance with the provisions of Treasury Regulation Section 1.338(h)(10)-1 (or
any comparable provisions of state or local tax law) (the “Elections”).
               (ii) In connection with the Elections, Buyer and Seller shall
mutually prepare a Form 8023 (or successor form) with any attachments with
respect to each such Generation U.S. Subsidiary. Seller shall prepare a draft
Form 8883 (or successor form) with respect to each such Generation U.S.
Subsidiary and provide such draft Forms 8883 to

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Buyer no later than ninety (90) days prior to the due date of such Forms 8883.
If, within thirty (30) days of the receipt of any draft Form 8883, Buyer
notifies Seller that it disagrees with any draft Form 8883, then Seller and
Buyer shall attempt to resolve their disagreement within the twenty (20) days
following Buyer’s notification of Seller of such disagreement; otherwise, the
draft Forms 8883 shall become “Final Forms 8883.” If Seller and Buyer are unable
to resolve their disagreement, the dispute shall be submitted to a mutually
agreed upon nationally recognized independent accounting firm, whose expense
shall be borne equally by Seller and Buyer, for resolution within twenty
(20) days of such submission. Any Form 8883 delivered by such accounting firm
shall be a Final Form 8883. The Final Forms 8883 shall be binding on Buyer,
Seller, and their respective Affiliates. Except as otherwise required by a final
determination, Buyer and Seller shall take no position, and cause their
respective Affiliates to take no position, inconsistent with the Final Forms
8883.
               (iii) Buyer and Seller shall mutually prepare, in a manner
similar to the above procedure, any forms or schedules similar to Forms 8023 or
8883 that are required by provisions of Applicable Law that are comparable to
Treasury Regulation Section 1.338(h)(10)-1. In the event that any Forms 8023 or
Final Form 8883 (or similar forms or schedules required for provisions of
Applicable Law) is disputed by any Taxing authority, the party receiving written
notice of the dispute shall promptly notify the other party hereto concerning
such dispute.
               (c) Tax Return Filings, Refunds, and Credits.
               (i) Seller shall timely prepare and file (or cause such
preparation and filing) with the appropriate Tax authorities all Tax Returns
(including any Consolidated Income Tax Returns) with respect to Generation and
the Material Subsidiaries for Tax periods that end on or before the Closing Date
(the “Seller Returns”), and will pay (or cause to be paid) all Taxes due with
respect to the Seller Returns.
               (ii) Buyer shall timely prepare and file (or cause such
preparation and filing) with the appropriate Tax authorities all Tax Returns
(the “Straddle Period Returns”) with respect to Generation and the Material
Subsidiaries for all Tax periods ending after the Closing Date that include the
Closing Date (the “Straddle Period”). All Straddle Period Returns shall be
prepared in accordance with past practice; provided that there is substantial
authority (or analogous authority for purpose of the particular Tax) for such
past practice. Buyer shall provide Seller with copies of any Straddle Period
Returns at least forty-five (45) days prior to the due date thereof (giving
effect to any extensions thereto), accompanied by a statement (the “Straddle
Statement”) setting forth and calculating in reasonable detail the Pre-Closing
Taxes of Generation and each Material

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Subsidiary. If Seller agrees with the Straddle Period Return and Straddle
Statement, Seller shall pay to Buyer (or Buyer shall pay to Seller, if
appropriate) an amount equal to the Ownership Percentage of the Pre-Closing
Taxes of Generation and each Material Subsidiary as shown on the Straddle
Statement not later than two (2) Business Days before the due date (including
any extensions thereof) for payment of Taxes with respect to such Straddle
Period Return. If, within fifteen (15) days of the receipt of the Straddle
Period Return and Straddle Statement, Seller notifies Buyer that it disputes the
manner of preparation of the Straddle Period Return or the amount calculated in
the Straddle Statement, then Buyer and Seller shall attempt to resolve their
disagreement within the five (5) days following Seller’s notification of Buyer
of such disagreement. If Buyer and Seller are unable to resolve their
disagreement, the dispute shall be submitted to a mutually agreed upon
nationally recognized independent accounting firm, whose expense shall be borne
equally by Buyer and Seller, for resolution, if possible, within twenty (20)
days of such submission. If the parties have not agreed on an independent
accounting firm within fifteen (15) days following Seller’s notification of
Buyer of such disagreement, on the request of any party such independent
accounting firm shall be appointed by the International Court of Arbitration of
the International Chamber of Commerce (the “ICAICC”). Any independent accounting
firm appointed by the ICAICC shall be an impartial and disinterested senior
partner in an internationally recognized accounting firm. The decision of such
accounting firm with respect to such dispute shall be binding upon Buyer and
Seller, and Seller shall pay to Buyer (or Buyer shall pay to Seller, if
appropriate) an amount equal to the Ownership Percentage of the Pre-Closing
Taxes of Generation and each Material Subsidiary as decided by such accounting
firm not later than two (2) Business Days before the due date (including any
extensions thereof) for payment of Taxes with respect to such Straddle Period
Return.
               (iii) From and after the Closing Date, Buyer and its Affiliates
(including Generation and, to the extent within the power of Buyer using its
reasonable best efforts, the Material Subsidiaries) will not file any amended
Tax Return, carryback claim, or other adjustment request with respect to
Generation and any Material Subsidiary for any Tax period that includes or ends
on or before the Closing Date unless Seller consents in writing or otherwise
required by Applicable Law or as a result of a tax proceeding; provided,
however, that (i) with respect to any Straddle Period Return, such consent shall
not be unreasonably withheld, delayed or conditioned and (ii) to the extent that
under Applicable Law, Buyer is not able to waive or forgo any carryback,
(A) Buyer shall notify Seller of the amount and character of such item,
(B) Seller shall reasonably cooperate with Buyer in obtaining any Tax refund or
credit with respect to such item and (C) upon receipt of any such Tax refund or
credit, Seller shall promptly pay over the amount of the Tax refund or credit to
Buyer in immediately available funds.

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               (iv) For purposes of this Agreement, any Taxes of Generation and
any Material Subsidiary that are attributable to Tax periods ending on or before
the Closing Date or, with respect to any Straddle Period, the portion of such
period ending on and including the Closing Date, shall constitute “Pre-Closing
Taxes” to the extent of the excess of (A) the amount of such Taxes over (B) any
payment or advances of Taxes or any payments of estimated Taxes with respect to
such period made on or before the Closing Date. For purposes of clause (A) of
the preceding sentence, such Taxes shall be computed on the basis of an interim
closing of the books as of the end of the Closing Date, except that any
exemption, deduction, credit or other item that is calculated on an annual basis
shall be allocated to the portion of the Straddle Period ending on the Closing
Date on a pro rata basis determined by multiplying the total amount of such item
allocated to the Straddle Period by a fraction, the numerator of which is the
number of calendar days in the portion of the Straddle Period ending on the
Closing Date and the denominator of which is the number of calendar days in the
entire Straddle Period. Pre-Closing Taxes include any Taxes attributable to any
Material Subsidiary that is treated as a partnership for U.S. federal income tax
purposes as if the Material Subsidiary allocated Tax items to its partners in a
manner consistent with this Section 5.7(b)(iv). The parties hereto will, to the
extent permitted by Applicable Law, elect with the relevant Tax authority to
treat as a short taxable period the portion of any Straddle Period ending as of
the close of business on the Closing Date. For purposes of this Agreement,
“Post-Closing Taxes” shall include any Taxes of Generation and any Material
Subsidiary that are payable with respect to Tax periods beginning after the
Closing Date or a Straddle Period, except for the portion of any such Taxes that
constitutes Pre-Closing Taxes.
               (v) Except as provided in Section 5.7(c)(iii) with respect to
carrybacks, if a Tax Indemnified Party actually receives a refund or credit or
other reimbursement with respect to Taxes for which it would be indemnified
under this Agreement, the Tax Indemnified Party shall pay over such refund or
credit or other reimbursement to the Tax Indemnifying Party.
               (vi) Buyer shall not, and shall cause Generation and, to the
extent within the power of Buyer using reasonable best efforts, any Material
Subsidiary to not, make, amend or revoke any Tax election if such action would
reasonably be expected to adversely affect any of Seller or its Affiliates with
respect to any Tax period ending on or before the Closing Date or for the
pre-Closing portion of any Straddle Period or any Tax refund or credit with
respect thereto. Seller shall not, and shall cause Generation and any Material
Subsidiary to not, make, amend or revoke any Tax election if such action would
reasonably be expected to adversely affect any of Buyer or its Affiliates with
respect to any Tax period

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beginning after the Closing Date or for the post-Closing portion of any Straddle
Period or any Tax refund or credit with respect thereto.
               (vii) For purposes of this Agreement a “Consolidated Income Tax
Return” is any income Tax Return filed with respect to any consolidated,
combined, affiliated or unified group provided for under Section 1501 of the
Code and the Treasury regulations under Section 1502 of the Code, or any
comparable provisions of Applicable Law, other than any income Tax Return that
includes only Generation or any Material Subsidiary.
               (d) Indemnity for Taxes.
               (i) Seller hereby agrees to indemnify Buyer and its Affiliates
against and hold them harmless from the Ownership Percentage of any liability
for (A) Pre-Closing Taxes of Generation and any Material Subsidiary, and (B) all
Taxes that are attributable to Seller or any member (other than Generation and
any Material Subsidiary) of an affiliated, consolidated, combined or unitary Tax
group of which at least one of Generation or any Material Subsidiary was a
member prior to the Closing Date that is imposed under Treasury
Regulation Section 1.1502-6 (or any similar provision of state, local or foreign
Tax law) by reason of Generation or any Material Subsidiary being included in
any such Tax group.
               (ii) Buyer hereby agrees to indemnify Seller and its Affiliates
against and hold them harmless from the Ownership Percentage of any liability
for Post-Closing Taxes of Generation or any Material Subsidiary.
               (iii) The obligation of Seller to indemnify and hold harmless
Buyer, on the one hand, and the obligations of Buyer to indemnify and hold
harmless Seller, on the other hand, pursuant to this Section 5.7, shall
terminate thirty (30) days following the expiration of the applicable statutes
of limitations with respect to the Tax Liabilities in question (giving effect to
any waiver, mitigation or extension thereof) and shall not be subject to the
limitations in Article VIII hereof.
               (iv) Any indemnification obligation under this Section 5.7(d)
shall be net of any Tax Benefit realized by the indemnified party or any
Material Subsidiary in a Tax period beginning after the Closing Date or, with
respect to a Straddle Period, the portion of such Straddle Period beginning the
day after the Closing Date. For purposes of this Agreement, “Tax Benefit” shall
mean the actual Tax savings attributable to any deduction, expense, loss, credit
or refund to the indemnified party or any Material Subsidiary, as and when
incurred or

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received, calculated on a last item used basis, and in the case of a Material
Subsidiary, limited to the Ownership Percentage thereof.
               (e) Certain Payments. Buyer and Seller agree to treat (and cause
their Affiliates to treat) any payment under this Section 5.7 as an adjustment
to the Purchase Price for all Tax purposes.
               (f) Contests.
               (i) After the Closing Date, Seller and Buyer each shall notify
the other party in writing within ten (10) days of the commencement of any Tax
audit or administrative or judicial proceeding affecting the Taxes of any of
Generation or the Material Subsidiaries that, if determined adversely to the
taxpayer would be grounds for indemnification under this Section 5.7 of one
party (the “Tax Indemnified Party”) by the other party (the “Tax Indemnifying
Party” and a “Tax Claim”). Such notice shall contain factual information
describing any asserted Tax liability in reasonable detail and shall include
copies of any notice or other document received from any Tax authority in
respect of any such asserted Tax liability. Failure to give such notification
shall not affect the indemnification provided in this Section 5.7 except to the
extent the Tax Indemnifying Party shall have been actually prejudiced as a
result of such failure. Thereafter, the Tax Indemnified Party shall deliver to
the Tax Indemnifying Party, as promptly as possible but in no event later than
ten (10) days after the Tax Indemnified Party’s receipt thereof, copies of all
relevant notices and documents (including court papers) received by the Tax
Indemnified Party.
               (ii) In the case of an audit or administrative or judicial
proceeding involving any asserted liability for Taxes of Generation or any
Material Subsidiary relating to any taxable years or periods ending on or before
the Closing Date or any Straddle Period, as between Buyer and Seller, Seller
shall have the right, at its sole expense, to control the conduct of such audit
or proceeding; provided, however, that (A) with respect to Straddle Periods,
Seller shall keep Buyer reasonably informed with respect to the status of such
audit or proceeding and provide Buyer with copies of all written correspondence
with respect to such audit or proceeding in a timely manner, (B) if such audit
or proceeding would be reasonably expected to result in a material increase in
Tax liability of Generation or any Material Subsidiary for which Buyer would be
liable under this Section 5.7, Buyer may participate in the conduct of such
audit or proceeding at its own expense and (C) Seller shall not consent to any
settlement or adjustment with respect to such audit or proceeding without the
written consent of Buyer if such settlement or adjustment would have the effect
of materially increasing the Tax liability of Buyer, Generation or any Material
Subsidiary after the Closing Date.

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               (iii) In the case of an audit or administrative or judicial
proceeding involving any asserted liability for Taxes of Generation or any
Material Subsidiary relating to any taxable years or periods beginning after the
Closing Date, as between Buyer and Seller, Buyer shall have the right, at its
expense, to control the conduct of such audit or proceeding.
               (iv) Buyer and Seller shall reasonably cooperate in connection
with any Tax Claim, and such cooperation shall include the provision to the Tax
Indemnifying Party of records and information which are reasonably relevant to
such Tax Claim and making employees available on a mutually convenient basis to
provide additional information and explanation of any material provided
hereunder.
               (v) Notwithstanding anything to the contrary in this
Section 5.7(f), and for the avoidance of doubt, in the case of any Tax Claim,
audit or administrative or judicial proceeding with respect to any Material
Subsidiary that is not a wholly-owned Subsidiary, the Tax Indemnified Party
shall only be required hereunder to confer on the Tax Indemnifying Party such
rights as it would otherwise have vis-à-vis third parties with respect to such
Tax Claim, audit or administrative or judicial proceeding.
               (g) Assistance and Cooperation.
               (i) Seller and Buyer shall reasonably cooperate in preparing and
filing all Tax Returns with respect to any of Generation or the Material
Subsidiaries, including maintaining and making available to each other all
records and personnel reasonably necessary in connection with Taxes of any of
Generation or the Material Subsidiaries and in resolving all disputes and audits
with respect to all Tax periods relating to Taxes of any of Generation or the
Material Subsidiaries.
               (ii) For a period of seven (7) years after the Closing Date,
Seller and its representatives shall have reasonable access to the books and
records (including the right to make extracts thereof) of any of Generation or
the Material Subsidiaries to the extent that such books and records relate to
Taxes and to the extent that such access (i) is within the power of Buyer using
reasonable best efforts and (ii) may reasonably be required by Seller in
connection with matters relating to or affected by the operation of any of
Generation or the Material Subsidiaries prior to the Closing Date. Such access
shall be afforded by Buyer upon receipt of reasonable advance notice and during
normal business hours. If Buyer shall desire to dispose of any of such books and
records prior to the expiration of such seven-year period, Buyer shall, prior to
such disposition, give Seller a reasonable opportunity, at Seller’s expense, to
segregate and remove such books and records as Seller may select.

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               (iii) For a period of seven (7) years after the Closing Date,
Buyer and its representatives shall have reasonable access to the books and
records (including the right to make extracts thereof) of Seller to the extent
that such books and records relate to Taxes of Generation or the Material
Subsidiaries and to the extent that such access (i) is within the power of
Seller using reasonable best efforts and (ii) may reasonably be required by
Buyer in connection with matters relating to or affected by the operation of any
of Generation or the Material Subsidiaries after the Closing Date. Such access
shall be afforded by Seller upon receipt of reasonable advance notice and during
normal business hours. If Seller shall desire to dispose of any such books and
records prior to the expiration of such seven year period, Seller shall, prior
to such disposition, give Buyer reasonable opportunity, at Buyer’s expense, to
segregate and remove such books and records as Buyer may select.
               (h) Transfer and Similar Taxes. Notwithstanding any other
provisions of this Agreement to the contrary, all sales, use, transfer, stamp,
duties, recording and similar Taxes (collectively, “Transfer Taxes”) incurred in
connection with the transactions contemplated by this Agreement shall be borne
by 50% by Seller and 50% by Buyer, and Buyer shall file all necessary Tax
Returns and other documentation with respect to Transfer Taxes. If required by
Applicable Law, Seller will join in the execution of any such Tax Return. Buyer
shall provide copies of any Tax Returns with respect to Transfer Taxes to Seller
no later than five (5) days after the due dates of such Tax Returns.
               (i) Termination of Tax Sharing Agreements. On or prior to the
Closing Date, Seller shall cause all Tax sharing agreements between Seller or
any of its Affiliates (as determined immediately after the Closing Date) on the
one hand, and any of Generation or the Material Subsidiaries on the other hand,
to be terminated, and all obligations thereunder shall be settled, and no
additional payments shall be made under any provisions thereof after the Closing
Date.
               (j) Post-Closing Actions Affecting Seller’s Liability for Taxes.
During any Taxable year that includes the Closing Date, Buyer shall (i) consult
in good faith with Seller prior to (A) the sale of all or a material portion of
the assets of any Subsidiary listed on Section 5.7(j) of the Seller Disclosure
Letter (a “Section 5.7(j) Subsidiary”) other than in the ordinary course of
business or (B) the liquidation or dissolution of any Section 5.7(j) Subsidiary
in a transaction that would be treated as a taxable liquidation of a corporation
for United States federal income tax purposes and (ii) use reasonable best
efforts, to the extent within its power, to structure such transaction (or to
cause such transaction to be structured) in a manner intended (based on
consultation in good faith with Seller) to minimize any increased United States
federal income tax burden that Seller would suffer as a result of such actions;
provided, however, that Buyer shall have reasonable discretion to conduct and
manage the business and organize the ownership structure of the Section 5.7(j)
Subsidiaries in a manner it deems reasonably advisable, and provided, further,
that Buyer shall not be required to indemnify Seller for any increase in Taxes
that occurs as a result of such actions. For the avoidance of doubt,

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(i) this Section 5.7(j) does not apply to any Taxable year beginning after the
end of the Taxable year that includes the Closing Date and (ii) each Taxable
year shall be deemed to begin on January 1st and end on December 31st.
               (k) For purposes of applying this Section 5.7, but subject to
Section 5.16, when applying the definitions “Pre-Closing Taxes,” “Post-Closing
Taxes,” and “Straddle Period,” to Taxes of Material Subsidiaries other than
Generation US Subsidiaries, the term “Closing Date” as used in such definitions
shall mean September 30, 2006.
          Section 5.8 Intercompany Accounts. Except as set forth on Section 5.8
of the Seller Disclosure Letter, prior to the Closing Date, subject to
Section 5.1(c), Seller shall, and shall cause its Affiliates (other than
Generation and the Material Subsidiaries) to, settle intercompany accounts
payable to Generation or the Material Subsidiaries and accounts receivable from
Generation or the Material Subsidiaries. Except as set forth in Section 5.8 of
the Seller Disclosure Letter, subject to Section 5.1(c), Seller shall determine
the method by which such intercompany accounts are eliminated including, but not
limited to, by means of setoff, settlement, capital contribution or reduction in
capital, with the intent of such intercompany account elimination not to
adversely affect the cash position of Generation and the Material Subsidiaries.
          Section 5.9 Maintenance of Insurance Policies.
               (a) Prior to the Closing Date, Seller shall (and shall ensure
that each of its Affiliates shall) continue in force and comply with all
Insurance Policies in respect of the businesses of Generation and the Material
Subsidiaries.
               (b) If any insured event occurs before Closing in relation to
Generation and the Material Subsidiaries, Seller shall use reasonable best
efforts to make recovery under the relevant Insurance Policy prior to Closing.
To the extent that recovery is made, Seller shall ensure that the proceeds are
dealt with in accordance with procedures normally observed by the businesses of
Generation and the Material Subsidiaries.
               (c) Seller shall ensure that each of its Affiliates shall take
such steps as Buyer reasonably requires to make and/or pursue any claim
(including giving notice of the claim to the insurer at the request of Buyer) or
to assist Buyer, Generation or any Material Subsidiary in making the claim, and
shall pay to Buyer (on behalf of Generation or any Material Subsidiary) any
proceeds actually received by Seller or its Affiliates within fifteen
(15) Business Days of their receipt.
               (d) Seller and Buyer agree that Casualty Insurance Claims
relating to the businesses of Generation and the Generation Subsidiaries
(including reported claims and including incurred but not reported claims) will
remain with Generation and the Generation Subsidiaries immediately following the
Closing. For purposes hereof, “Casualty Insurance Claims” shall mean workers’
compensation, auto liability, general liability, directors and officers
liability and products liability claims,

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claims for damages caused to the facilities of Generation and the Generation
Subsidiaries generally insured under all risk, real property, boiler and
mechanical breakdown insurance coverage. The Casualty Insurance Claims are
subject to the provisions of policies of insurance with insurance carriers and
contractual arrangements with insurance adjusters maintained by Seller or its
Affiliates prior to the Closing (collectively, the “Insurance Policies”). With
respect to the Casualty Insurance Claims, the following procedures shall apply:
(i) Seller or its Affiliates shall continue to administer, adjust, settle and
pay, on behalf of Generation and the Generation Subsidiaries, all Casualty
Insurance Claims with dates of occurrence prior to the date of Closing and
(ii) Seller shall invoice Buyer at the end of each month for Casualty Insurance
Claims paid on behalf of Generation and the Generation Subsidiaries by Seller.
In the event that Buyer does not pay, or cause to be paid, to Seller such amount
due within fifteen (15) days of such invoice, interest at the rate of ten
percent (10%) per annum shall accrue on the amount of such invoice. Casualty
Insurance Claims to be paid by Seller hereunder shall include all costs
necessary to settle claims including compensatory, medical, legal and other
allocated expenses. In the event that any Casualty Insurance Claim exceeds a
deductible or self-insured retention under the Insurance Policies, Seller shall
be entitled to the benefit of any insurance proceeds that may be available to
discharge any portion of such Casualty Insurance Claim.
               (e) Seller makes no representation or warranty with respect to
the applicability or adequacy or, except as set forth in Section 3.15 hereof,
validity of any Insurance Policies, and Seller shall not be responsible to Buyer
or any of its Affiliates for the failure of any insurer to pay under any such
Insurance Policy.
               (f) Nothing in this Agreement is intended to provide or shall be
construed as providing a benefit or release to any insurer or claims service
organization of any obligation under any Insurance Policies. Seller and Buyer
confirm that the sole intention of this Section 5.9 is to divide and allocate
the benefits and obligations under the Insurance Policies between them as of the
Closing Date and not to effect, enhance or diminish the rights and obligations
of any insurer or claims service organization thereunder. Nothing herein shall
be construed as creating or permitting any insurer or claims service
organization the right of subrogation against Seller or Buyer or any of their
Affiliates in respect of payments made by one to the other under any Insurance
Policy.
               (g) If Buyer requests a copy of an Insurance Policy relating to a
pending or threatened Casualty Insurance Claim, Seller shall provide a copy of
all relevant insurance policies which insure such Casualty Insurance Claims
within five (5) Business Days, provided, that if Seller cannot provide such
policy within five (5) days after exercising reasonable best efforts to locate
such policy, Seller shall continue to exercise its reasonable best efforts to
provide such policy to Buyer as soon as possible thereafter.
     Section 5.10 Preservation of Records. Buyer agrees that it shall, at its
own expense, preserve and keep the records held by it relating to the respective
businesses of Generation and the Material Subsidiaries that could reasonably be
required after the Closing by Seller for the greater of (a) the time periods
required pursuant to the Access

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and Support Agreement and (b) the time periods required pursuant to the
applicable document retention program in effect on the Closing Date (a copy of
which has been provided to Buyer); provided, however, that upon expiration of
such period, as applicable, Buyer shall give written notice to Seller if it or
the custodian of such books and records proposes to destroy or dispose of the
same. Seller shall have the opportunity for a period of thirty (30) days after
receiving such notice to elect to have some or all of such books and records
delivered, at Seller’s expense and risk, to a location chosen by Seller. In
addition, at Seller’s expense Buyer shall make such records available to Seller
as may reasonably be required by Seller in connection with, among other things,
any insurance claim, legal proceeding or governmental investigation relating to
the respective businesses of Seller and its Affiliates, including Generation and
the Material Subsidiaries.
     Section 5.11 Public Statements. On or prior to the Closing Date, neither
party shall, nor shall permit its Affiliates to, issue or cause the publication
of any press release or other announcement with respect to this Agreement, the
Related Agreements or the Consent and Support Agreement or the transactions
contemplated hereby or thereby without the consent of the other party hereto.
Notwithstanding the foregoing, in the event any such press release or
announcement is required by law, court process or stock exchange rule to be made
by the party proposing to issue the same, such party shall use its reasonable
best efforts to consult in good faith with the other party prior to the issuance
of any such press release or announcement.
     Section 5.12 Certain Transactions.
               (a) Buyer and Seller shall not, and shall not permit any of their
respective Subsidiaries to, acquire or agree to acquire by merging or
consolidating with, or by purchasing a substantial portion of the assets of or
equity in, or by any other manner, any business or any corporation, partnership,
association or other business organization or division thereof, or otherwise
acquire or agree to acquire any assets if the entering into of a definitive
agreement relating to, or the consummation of such acquisition, merger or
consolidation would reasonably be expected to (i) impose any material delay in
the obtaining of, or significantly increase the risk of not obtaining, any
authorizations, consents, orders, declarations or approvals of any Governmental
Authority necessary to consummate the transactions contemplated by this
Agreement or the expiration or termination of any applicable waiting period,
(ii) significantly increase the risk of any Governmental Authority entering an
order prohibiting the consummation of the transactions contemplated by this
Agreement, (iii) significantly increase the risk of not being able to remove any
such order on appeal or otherwise or (iv) materially delay or prevent the
consummation of the transactions contemplated by this Agreement; provided,
however, that nothing in this Section 5.12(a) shall prevent the parties from
engaging from the actions set forth in Section 5.12 of the Seller Disclosure
Letter.
               (b) Prior to Closing, Buyer shall not, and shall not permit any
of its Affiliates to, agree to divest or otherwise dispose of, or cause the
divestiture or disposition of, any of the Generation Interests, except as set
forth in Section 5.3.

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          Section 5.13 Use of Corporate Name; Transitional Use of Seller’s Name.
               (a) As soon as reasonably practicable following the Closing Date,
but in no event later than ninety (90) days following the Closing Date, Buyer
shall cause each of Generation and the Subsidiaries of Generation located in
North America to change its corporate name to a name that does not include “CMS”
and to make any necessary legal filings with the appropriate Governmental
Authorities to effectuate such changes. Buyer and its Affiliates shall hold
harmless and indemnify Seller and any of its Affiliates against all Damages
resulting from or arising in connection with the use by Buyer or any of its
Affiliates of the “CMS” name as provided in this Section 5.13.
               (b) At Closing, Seller and Buyer shall enter into the License
Agreement, pursuant to which Seller shall grant to Buyer a limited,
non-transferable license to use the name and mark “CMS Generation Co” in
jurisdictions outside North and South America on the terms and subject to the
conditions set forth therein (including those with respect to quality control).
               (c) Seller hereby grants to Buyer and its Affiliates a limited,
non-exclusive, royalty-free license to use the trademarks, service marks and
trade names listed on 5.13(c) of the Seller Disclosure Letter, together with all
slogans, logotypes, designs and trade dress associated therewith that are, in
each case, in existence as of the Closing Date and currently being used in the
conduct of the businesses of Generation and the Material Subsidiaries
(collectively, the “Seller’s Marks”) solely on and in connection with the goods
and services of the respective businesses of Generation and the Material
Subsidiaries and that are embodied in or on any stationery, business cards,
advertising and promotional materials, packaging and labels, equipment, manuals
and other documentation, statements of work, trucks, hard hats, e-mail
addresses, caller ID, printed facsimile headers and footers, web page content
and URLs for web sites, Messenger screens and signs on facilities owned or
leased by Generation or the Material Subsidiaries (“Business Materials”), and
for any administrative, corporate and legal use in connection with the
transition away from using the Seller’s Marks; provided, that not more than six
(6) months following the Closing except as expressly provided in the License
Agreement, Buyer shall cease to (i) make any use of Seller’s Marks and any names
or marks related thereto or containing or comprising the Seller’s Marks,
including any names or marks confusingly similar thereto or derivative thereof,
and (ii) hold itself out as having any affiliation with Seller or its
Affiliates.
               (d) Any use by Buyer or any of its Affiliates of any of the
Seller’s Marks as permitted in this Section 5.13 is subject to their compliance
with the quality control requirements and guidelines in effect for the Seller’s
Marks as of the Closing Date and all such use shall be in a manner and at the
level of quality consistent with that in effect as of the Closing Date. Buyer
and its Affiliates shall hold harmless and indemnify Seller and any of its
Affiliates for any Damages resulting from or arising in connection with the use
by Buyer or any of its Affiliates of the Seller’s Marks pursuant to this
Section 5.13.

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          Section 5.14 Release of Guarantees. Prior to the Closing, Buyer shall,
effective on the Closing Date, either (a) arrange for substitute letters of
credit, guarantees and other obligations on commercially reasonable terms to
replace in all respects the indemnities, performance bonds, performance
guarantees, other guaranty obligations, letters of credit and other similar
arrangements of Seller or its Affiliates (collectively, the “Released Parties”)
in favor of any of Generation or a Material Subsidiary (collectively,
“Guarantees”) or (b) assume all obligations under each such Guarantee, obtaining
from the creditor or other counter-party a full release of the Released Parties.
Section 5.14 of the Seller Disclosure Letter contains a true and accurate list
of such Guarantees. Effective as of the Closing, Buyer shall terminate, or cause
Buyer or one of its Affiliates to be substituted in all respects for the
Released Parties in respect of, all obligations of the Released Parties under
any such Guarantee. Buyer shall, to the extent the beneficiary or counter-party
under any Guarantee refuses to accept such a substitute letter of credit,
(i) obtain a letter of credit on behalf of a Released Party and (ii) indemnify
and hold harmless the Released Parties for any Losses arising from payments
under such Guarantees that relate to events or circumstances arising after the
Closing. To the extent that any Released Party has performance obligations under
any such Guarantee, Buyer shall (i) perform such obligations on behalf of such
Released Party or (ii) otherwise take such action as reasonably requested by
Seller so as to put such Released Party in the same position as if Buyer, and
not such Released Party, had performed or was performing such obligations.
          Section 5.15 Reorganization. Prior to the Closing, Seller shall
undertake the corporate restructuring steps set forth in Section 5.15 of the
Seller Disclosure Letter; provided, however, that Seller shall be allowed to
modify Section 5.15 of the Seller Disclosure Schedule to avoid any adverse
regulatory or Tax implications to the extent such modifications do not
materially and negatively impact Buyer. Seller shall be responsible for the
payment of all costs, Taxes and expenses relating to the implementation of the
Reorganization and Seller shall keep Buyer reasonably updated in relation to the
progress of the Reorganization.
          Section 5.16 Merger and Redomiciliation. Prior to Closing, Seller
shall (a) cause the Merger to be consummated and (b) use its reasonable best
efforts to cause the Redomiciliation and the tax elections set forth in
Section 5.16 of the Seller Disclosure Letter (the “Tax Elections”) to be
consummated, and Seller shall keep Buyer reasonably updated in relation to the
progress of the Merger, Redomiciliation and Tax Elections and allow Buyer and
its advisors reasonable opportunity to review and comment on all documentation
relating to the Merger, Redomiciliation and Tax Elections. Buyer shall be
responsible for the payment of all costs, Taxes and reasonable expenses relating
to the implementation of the Merger, Redomiciliation and Tax Elections, up to an
aggregate amount of $100,000.

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          Section 5.17 CGIC Loan Agreement. At least 30 days prior to Closing,
Buyer shall, or shall cause one of its Affiliates to, and Seller shall cause CMS
Generation Investment Company IV, to enter into the CGIC Loan Agreement.
          Section 5.18 Assignment of Contracts. At or prior to Closing, Seller
shall use its reasonable best efforts to assign all Contracts, liabilities and
obligations associated with the entities being transferred by Seller pursuant to
the Reorganization such that such entities will not be held, directly or
indirectly, by Generation.
          Section 5.19 Financial Statements. To the extent that an audit report
for a more recent period that reflected in the representation set forth in
Section 3.17 is provided to Seller at or prior to the Closing, with respect to
the financial statements of Jorf, Jubail, Neyveli, Takoradi, Shuweihat CMS
International Power Company PJSC, Taweelah or CMS Energy (UK) Limited, Jorf
Lasfar Handelsbolag, Jorf Lasfar Power Energy Aktiebolag or Jorf Lasfar
Energiaktiebolag (each, “2006 Financial Statements”), Seller shall provide Buyer
with a copy of the 2006 Financial Statements as soon as reasonably practicable
following its receipt thereof.
ARTICLE VI
CONDITIONS
          Section 6.1 Mutual Conditions to the Closing. The respective
obligations of each party to consummate the transactions contemplated by this
Agreement shall be subject to the satisfaction or waiver of each of the
following conditions at or prior to the Closing Date:
               (a) Any waiting period (and any extension thereof) under any
applicable Competition Law relating to the transactions contemplated by this
Agreement, which, by its terms is required to have expired or been terminated
prior to Closing, shall have expired or have been terminated;
               (b) No court of competent jurisdiction or other competent
Governmental Authority shall have issued a statute, rule, regulation, order,
decree or injunction or taken any other action restraining, enjoining or
otherwise prohibiting the transactions contemplated by this Agreement and the
Related Agreements, except transactions that if prohibited would not have an
adverse impact on the economic value of the transactions contemplated by the
Agreement or the Related Agreements.
               (c) The Reorganization shall have been completed;
               (d) The Merger shall have been consummated; and
               (e) (i) if the consents required pursuant to Section 5.4(b) have
been received prior to the Prepayment Notice Date, any consent of a third party
required pursuant to Sections 5.4(a) and (b) shall have been obtained or (ii) if
the consents required pursuant to Section 5.4(b) have not been received prior to
the Prepayment

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Notice Date, any consent of a third party necessary to effect the JLEC
Refinancing shall have been obtained.
          Section 6.2 Buyer’s Conditions to the Closing. The obligations of
Buyer to consummate the transactions contemplated by this Agreement shall be
subject to the satisfaction or waiver of each of the following conditions at or
prior to the Closing Date:
               (a) all representations and warranties of Seller in this
Agreement (without taking into account any materiality or Material Adverse
Effect qualification therein) shall be true and correct as of the Closing Date
with the same effect as though such representations and warranties had been made
as of the Closing Date (except for representations and warranties that speak as
of a specific date or time, which shall be true and correct only as of such date
or time), except (i) for changes specifically contemplated or permitted by this
Agreement and (ii) where such failure to be so true and correct, either
individually or in the aggregate, would not have a Material Adverse Effect as of
the Closing Date;
               (b) Seller shall have performed in all material respects all of
its obligations required to be performed by it under this Agreement at or prior
to the Closing Date;
               (c) Seller shall have delivered to Buyer a certificate as to the
satisfaction of the conditions set forth in Sections 6.2(a), (b) and (d), in the
form set forth in Exhibit E hereto, dated as of the Closing and executed by an
officer of Seller;
               (d) there shall not have occurred after the date hereof any event
or circumstance, which individually or in the aggregate, has resulted in a
Material Adverse Effect
               (e) Seller shall have complied in all material respects with its
obligations pursuant to Section 5.4; and
               (f) To the extent that 2006 Financial Statements have been
completed prior to Closing, Seller shall have provided such statements to Buyer
(with the exception of Neyveli, which has a fiscal year end of March 31st).
          Section 6.3 Seller’s Conditions to the Closing. The obligations of
Seller to consummate the transactions contemplated by this Agreement shall be
subject to the satisfaction or waiver of each of the following conditions at or
prior to the Closing Date:
               (a) all representations and warranties of Buyer in this Agreement
(without taking into account any materiality or Material Adverse Effect
qualification therein) shall be true and correct as of the Closing Date with the
same effect as though such representations and warranties had been made as of
the Closing Date (except for representations and warranties that speak as of a
specific date or time, which shall be true and correct only as of such date or
time), except (i) for changes specifically contemplated or permitted by this
Agreement and (ii) where such failure to be so true and correct, either
individually or in the aggregate, would not have a material adverse effect on

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Buyer’s ability to consummate the transactions contemplated hereby as of the
Closing Date;
               (b) Buyer shall have performed in all material respects all of
its obligations required to be performed by it under this Agreement at or prior
to the Closing Date;
               (c) Buyer shall have (i) complied in all material respects with
its obligations pursuant to Section 5.4 and (ii) if the consents required
pursuant to Section 5.4(b) have not been received prior to the Prepayment Notice
Date, following Buyer’s receipt of a duly executed draw down notice submitted by
Jorf in accordance with the agreed definitive documentation required to
implement the JLEC Refinancing at or prior to Closing, the Schedule 5.4(b) Debt
shall have been repaid in full as contemplated by the JLEC Term Sheet;
               (d) The written consents set forth in Section 6.3(d) of the
Seller Disclosure Letter shall have been obtained; and
               (e) Buyer shall have delivered to Seller a certificate as to the
satisfaction of the conditions set forth in Sections 6.3(a), (b), (c) and (d),
in the form set forth in Exhibit F hereto, dated as of the Closing and executed
by an officer of Buyer.
ARTICLE VII
TERMINATION AND ABANDONMENT
          Section 7.1 Termination.
     This Agreement may be terminated at any time prior to the Closing Date by:
               (a) mutual written consent of the parties;
               (b) either party, upon written notice to the other party, if the
Closing shall not have occurred on or before May 31, 2007; provided that if
Closing does not occur by May 31, 2007 the term of this Agreement automatically
shall be extended until June 30, 2007, provided that no Material Adverse Effect
has occurred at the time of such extension;
               (c) either party, upon written notice to the other party, if any
of the mutual conditions to the Closing set forth in Section 6.1 shall have
become permanently incapable of fulfillment and shall not have been waived in
writing by the other party; and
               (d) either party, if any Governmental Authority shall have issued
a law, order, decree or ruling or taken any other action, which permanently
restrains, enjoins or otherwise prohibits the transactions contemplated by this
Agreement and which order, decree, ruling or other action is final and not
subject to appeal; unless failure to consummate closing because of such action
by the Governmental Authority is due to

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the failure of the party seeking to terminate to have fulfilled its obligations
under Sections 5.3 or 5.4.
          Section 7.2 Procedure and Effect of Termination.
               (a) Subject to Section 7.2(d), in the event of the termination of
this Agreement pursuant to Section 7.1, (i) this Agreement, except for the
provisions of Section 5.2(b), all of Article IX and this Section 7.2, shall
become void and have no effect, without any Liability on the part of any party
hereto or its Affiliates; provided, however, that nothing in this Section 7.2
shall relieve any party for liability for any breach of this Agreement and
(ii) all filings, applications and other submissions made pursuant to this
Agreement, to the extent practicable, shall be withdrawn from the agency or
other Person to which they were made or appropriately amended to reflect the
termination of the transactions contemplated hereby. Notwithstanding the
foregoing, (x) nothing in this Section 7.2 shall relieve any party hereto of
Liability for a material breach of any of its obligations under this Agreement,
and (y) if it shall be judicially determined that termination of this Agreement
was caused by an intentional breach of this Agreement, then, in addition to
other remedies at law or equity for breach of this Agreement, the party so found
to have intentionally breached this Agreement shall indemnify and hold harmless
the other party hereto for its respective out-of-pocket costs, including the
fees and expenses of their counsel, accountants, financial advisors and other
experts and advisors, as well as fees and expenses incident to the negotiation,
preparation and execution of this Agreement and related documentation.
               (b) In the event of the termination of this Agreement, except as
set forth in Section 7.2(c), upon such termination, Seller shall pay to Buyer
the Deposit, together with the interest thereon from the date hereof to the date
of payment at a floating rate equal to the NAT’L AVG of the “Money market ann.
yield" as published in the Wall Street Journal on the first business day of each
applicable month and based on a year of 365 days and the number of days elapsed
in each month since the date hereof.
               (c) In the event that this Agreement is terminated pursuant to
Section 7.1(b) and at such time, all conditions in Article VI have been
satisfied, except for the condition set forth in Section 6.3(c) and other than
those conditions that by their nature would only be satisfied at Closing, upon
such termination, Seller shall retain one hundred percent (100%) of the Deposit.
ARTICLE VIII
SURVIVAL; INDEMNIFICATION
          Section 8.1 Survival.
               (a) All representations and warranties contained herein shall
survive for a period of twenty-four (24) months following the Closing Date,
except for (i) representations and warranties contained in Section 3.1
(Corporate Organization; Qualification), Section 3.2 (Authority Relative to this
Agreement), Section 3.3

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(Generation Interests), Section 4.1 (Corporate Organization), and Section 4.2
(Authority Relative to this Agreement), which shall survive indefinitely, (ii)
representations and warranties contained in Section 3.14 (Tax Matters), which
shall survive for thirty (30) days following the expiration of the applicable
statute of limitations and (iii) representations and warranties contained in
Section 3.13 (Environmental Matters), which shall survive for a period of three
(3) years following the Closing Date (such time periods set forth in clauses
(i), (ii) or (iii) or such twenty-four (24) month period, together with the
Special Indemnity Period are referred to herein as the relevant “Indemnity
Period”). The “Special Indemnity Period” shall mean the period starting on the
Closing Date and ending on the twenty-four (24) month anniversary of the Closing
Date, and such Special Indemnity Period shall only apply to indemnification
pursuant to Section 8.2(a)(v). If a written notice of claim for indemnification
is made during the Indemnity Period in accordance with this Article VIII, such
claim shall survive until its resolution. The parties intend to shorten the
statute of limitations and agree that no claims or causes of action may be
brought against Seller, Buyer or any of their respective directors, officers,
employees, Affiliates, controlling persons, agents or representatives based
upon, directly or indirectly, any of the representations and warranties
contained in this Agreement after the applicable Indemnity Period.
               (b) All covenants and agreements contained herein that by their
terms are to be performed in whole or in part, or which prohibit actions,
subsequent to the Closing Date, shall survive the Closing in accordance with
their terms. All other covenants and agreements contained herein shall not
survive the Closing and shall thereupon terminate.
          Section 8.2 Indemnification.
               (a) Subject to the limitations set forth in this Article VIII,
subsequent to the Closing, Seller shall indemnify, defend, save and hold
harmless Buyer and its Affiliates, their respective successors and permitted
assigns, and their officers and directors (collectively, the “Buyer Indemnified
Parties”), from and against any and all Damages incurred by a Buyer Indemnified
Party arising out of, resulting from or incurred in connection with:
               (i) except as set forth in 8.2(a)(ii), any breach or inaccuracy
of any representation or warranty of Seller contained in this Agreement, in each
case, as of the date hereof (except for representations and warranties that
speak as of a specific date or time);
               (ii) any breach or inaccuracy of any representation or warranty
of Seller contained in this Agreement, in each case, as of Closing (except for
representations and warranties that speak as of a specific date or time) that is
the result of events occurring after the date hereof and prior to the Closing
Date (i.e., a representation or warranty that was true and correct as of the
date hereof, but was breached or became inaccurate as of the Closing Date as a
result of an event occurring after the date hereof and prior to the Closing
Date), other than events

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permitted or contemplated by this Agreement or Material Contracts entered into
after the date hereof and prior to Closing pursuant and subject to the terms of
this Agreement;
               (iii) any breach in any material respect by Seller of any
covenant or agreement contained in this Agreement;
               (iv) the matters set forth on Section 8.2(a)(iv) of the Seller
Disclosure Letter; and
               (v) the matters set forth in Section 8.2(a)(v) of the Seller
Disclosure Letter.
               (b) Subject to the limitations set forth in this Article VIII,
subsequent to the Closing, Buyer shall indemnify, defend, save and hold harmless
Seller and its Affiliates, their respective successors and permitted assigns,
and their officers and directors (collectively, the “Seller Indemnified
Parties”) from and against any and all Damages to the extent incurred by the
Seller Indemnified Party arising out of, resulting from or incurred in
connection with:
               (i) any breach or inaccuracy of any representation or warranty of
Buyer contained in this Agreement, in each case, when made;
               (ii) any breach in any material respect by Buyer of any covenant
or agreement contained in this Agreement; and
               (iii) the employment or termination of employment by Buyer of any
of the Transferred Employees on or after the Closing Date.
               (c) Any Person providing indemnification pursuant to the
provisions of this Section 8.2 is referred to herein as an “Indemnifying Party,”
and any Person entitled to be indemnified pursuant to the provisions of this
Section 8.2 is referred to herein as an “Indemnified Party.”
               (d) Seller’s indemnification obligations contained in
Section 8.2(a)(i) (other than representations or warranties contained in
Section 3.3(a) — 3.3(g), inclusive) shall not apply to any Claim for Damages
unless and until the aggregate of all such Damages exceeds eight million dollars
($8,000,000) (the “Initial Deductible Amount”), in which event Seller’s
indemnity obligation contained in Section 8.2(a)(i) shall apply to all Claims
for Damages in excess of the Initial Deductible Amount.
               (e) Seller’s indemnification obligations contained in
Section 8.2(a)(ii) (other than representations or warranties contained in
Section 3.3(a) — 3.3(g), inclusive) shall not apply to any Claim for Damages
unless and until the aggregate of all such Damages exceeds five million dollars
($5,000,000) (the “Closing Deductible

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Amount”), in which event Seller’s indemnity obligation contained in
Section 8.2(a)(ii) shall apply to all Claims for Damages in excess of the
Closing Deductible Amount.
               (f) Seller’s indemnification obligations contained in
Sections 8.2(a)(i) and 8.2(a)(ii) (other than representations or warranties
contained in Section 3.3(a) — 3.3(g), inclusive) shall be subject to a maximum
liability to Seller, in the aggregate, of thirty-three and one-third percent (33
1/3%) of the Purchase Price (the “Cap Amount”). Damages relating to any single
breach or series of related breaches of Seller’s representations and warranties
shall not constitute Damages, and therefore shall not be applied towards the
Initial Deductible Amount or the Closing Deductible Amount (as applicable) or be
indemnifiable hereunder, unless such Damages relating to any single breach or
series of related breaches exceed $100,000 (the “Minimum Claim Amount”).
Seller’s indemnification obligations contained in Section 8.2(a)(v) shall be
subject to a maximum liability to Seller, in the aggregate, of $50,000,000.
               (g) Buyer’s indemnification obligations contained in
Section 8.2(b)(i) shall not apply to any Claim for Damages unless and until the
aggregate of all such Damages equals the Initial Deductible Amount, in which
event Buyer’s indemnification obligation contained in Section 8.2(b)(i) shall
apply to all Claims for Damages in excess of the Initial Deductible Amount,
subject to a maximum liability to Buyer, in the aggregate, of the Cap Amount.
Damages relating to any single breach or series of related breaches of Buyer’s
representations and warranties shall not constitute Damages, and therefore shall
not be applied towards the Initial Deductible Amount or be indemnifiable
hereunder, unless such Damages relating to any single breach or series of
related breaches exceed the Minimum Claim Amount.
               (h) The indemnification obligations of each party hereto under
this Section 8.2 shall inure to the benefit of the Buyer Indemnified Parties and
Seller Indemnified Parties, and such Buyer Indemnified Parties and Seller
Indemnified Parties shall be obligated to keep and perform the obligations
imposed on an Indemnified Party by this Section 8.2, on the same terms as are
applicable to such other party.
               (i) In all cases in which a Person is entitled to be indemnified
in accordance with this Agreement, such Indemnified Party shall be under a duty
to take all commercially reasonable measures to mitigate all losses.
               (j) All amounts paid by Seller or Buyer, as the case may be,
under this Article VIII shall be treated as adjustments to the Purchase Price
for all Tax purposes.
               (k) Notwithstanding any other provision in the Agreement to the
contrary, this Section 8.2 shall not apply to any Claim of indemnification
permitted to be brought pursuant to Section 5.7.
               (l) Notwithstanding any other provision of this Agreement, in no
event shall any Indemnified Party be entitled to indemnification pursuant to
this Article VIII to the extent any Damages are judicially determined, or
determined pursuant to

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Section 9.7 hereof, to be attributable to such Indemnified Party’s own gross
negligence or willful misconduct.
               (m) The remedies provided in this Article VIII shall be deemed
the sole and exclusive remedies of the parties, from and after the closing Date,
with respect to this Agreement and the transactions contemplated hereby.
               (n) If any deduction or withholding in respect of Taxes is
required by law to be made on an indemnification payment pursuant to this
Agreement, the amount of such indemnification payment shall be increased to any
amount which, after making any such deduction or withholding in respect of
Taxes, leaves an amount equal to the payment that would have been due if no such
deduction or withholding in respect of Taxes had been required.
          Section 8.3 Calculation of Damages.
               (a) The amount of any Damages suffered by any party hereto shall
be reduced by (i) any amount that is reserved or sums held in reserve in respect
of the indemnifiable event on the balance sheet of Generation or a Material
Subsidiary, as applicable, (ii) any amount that an Indemnified Party is entitled
to receive with respect thereto under any third party insurance coverage or from
any other party alleged to be responsible therefor or (iii) any Tax Benefit
realized by an Indemnified Party or a Material Subsidiary.
               (b) If an Indemnified Party makes a claim for indemnification
under this Article VIII, the Indemnified Party shall use its reasonable best
efforts to collect any amounts available under such insurance coverage and from
such other party alleged to have responsibility. If an Indemnified Party
receives an amount under insurance coverage or from such other party with
respect to Damages at any time subsequent to any indemnification provided by
Seller or Buyer, as the case may be, pursuant to this Article VIII, then such
Indemnified Party shall promptly reimburse the Indemnifying Party for any
payment made or expense incurred by the Indemnifying Party in connection with
providing such indemnification up to such amount received by the Indemnified
Party, but net of any expenses incurred by the Indemnified Party in collecting
such amount. To the extent the Indemnifying Party makes any indemnification
payment pursuant to this Article VIII in respect of Damages for which an
Indemnified Party has a right to recover against a third party (including an
insurance company), the Indemnifying Party shall be subrogated to the right of
the Indemnified Party to seek and obtain recovery from such third party;
provided, however, that if the Indemnifying Party shall be prohibited from such
subrogation, the Indemnified Party shall seek recovery from such third party on
the Indemnifying Party’s behalf and pay any such recovery to the Indemnifying
Party net of expenses.
               (c) For the avoidance of doubt, any Damages of Buyer shall
include only the portion of such Damages attributable to the ownership interest
of Generation and its Affiliates in a Material Subsidiary and shall exclude any
portion of

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such Damages attributable to the ownership interest of any third party in such
Material Subsidiary.
          Section 8.4 Procedures for Third-Party Claims. Subject to the Access
and Support Agreement, the obligations of any Indemnifying Party to indemnify
any Indemnified Party under this Article VIII with respect to Claim for Damages
by third parties (including Governmental Entities) (a “Third-Party Claim”) shall
be subject to the following terms and conditions:
          (a) The Indemnified Party shall give the Indemnifying Party written
notice of any such Third-Party Claim promptly after learning of such Third-Party
Claim, and the Indemnifying Party may, at its option, undertake the defense
thereof by representatives of its own choosing and shall provide written notice
of any such undertaking to the Indemnified Party. Failure to give prompt written
notice of a Third-Party Claim hereunder shall not affect the Indemnifying
Party’s obligations under this Article VIII, except to the extent that the
Indemnifying Party is actually prejudiced by such failure to give prompt written
notice. The Indemnified Party shall, and shall cause its employees and
representatives to, cooperate with the Indemnifying Party in connection with the
settlement or defense of such Third-Party Claim and shall provide the
Indemnifying Party with all available information and documents concerning such
Third-Party Claim. The Indemnifying Party shall provide the Indemnified Party
with copies of all non-privileged communications and other information in
respect of the Third-Party Claim. If the Indemnifying Party, within thirty
(30) days after written notice of any such Third-Party Claim, fails to assume
the defense of such Third-Party Claim or, after assuming defense, negligently
fails to defend and fails to call after reasonable written notice of the same,
the Indemnified Party against whom such Third-Party Claim has been made shall
(upon further written notice to the Indemnifying Party) have the right to
undertake the defense, compromise or settlement of such Third-Party Claim on
behalf of and for the account and risk, and at the expense, of the Indemnifying
Party, subject to the right of the Indemnifying Party to assume the defense of
such Third-Party Claim at any time prior to settlement, compromise or final
determination thereof upon written notice to the Indemnified Party.
          (b) Anything in this Section 8.4 to the contrary notwithstanding,
(i) the Indemnified Party shall not settle a Third-Party Claim for which it is
indemnified without the prior written consent of the Indemnifying Party, which
consent shall not be unreasonably withheld, conditioned or delayed and (ii) the
Indemnifying Party shall not enter into any settlement or compromise of any
action, suit or proceeding, or consent to the entry of any judgment for relief
other than monetary damages to be borne by the Indemnifying Party, without the
prior written consent of the Indemnified Party, which consent shall not be
unreasonably withheld, conditioned or delayed.
          Section 8.5 Procedures for Inter-Party Claims. In the event that an
Indemnified Party determines that it has a Claim for Damages against an
Indemnifying Party hereunder (other than as a result of a Third-Party Claim),
the Indemnified Party shall give reasonably prompt written notice thereof to the
Indemnifying Party, specifying the amount of such Claim and any relevant facts
and circumstances relating thereto, and

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such notice shall be promptly given even if the nature or extent of the Damages
is not then known. The notification shall be subsequently supplemented within a
reasonable time as additional information regarding the Claim or the nature or
extent of Damages resulting therefrom becomes available to the Indemnified
Party. Any failure to give such reasonably prompt notice or supplement thereto
or to provide any such facts and circumstances will not waive any rights of the
Indemnified Party, except to the extent that the rights of the Indemnifying
Party are actually materially prejudiced thereby. The Indemnified Party and the
Indemnifying Party shall attempt to negotiate in good faith for a thirty
(30) day period regarding the resolution of any disputed Claims for Damages. If
for any reason, such dispute cannot be resolved by negotiation, on the request
of any party it shall be resolved by arbitration in accordance with Section 9.7.
Promptly following the final determination of the amount of any Damages claimed
by the Indemnified Party, the Indemnifying Party, subject to the limitations of
the Minimum Claim Amount, Initial Deductible Amount, the Closing Deductible
Amount and the Cap Amount, shall pay such Damages to the Indemnified Party by
wire transfer or check made payable to the order of the Indemnified Party.
          Section 8.6 Additional Procedures for Claims Made Pursuant to
Section 8.2(a)(v).
          (a) Any claims for Damages by a Buyer Indemnified Party pursuant to
Section 8.2(a)(v) shall be made during the Special Indemnity Period.
          (b) The Buyer Indemnified Parties shall have no right to bring a claim
for Damages for any item listed on Section 8.2(a)(v) pursuant to
Section 8.2(a)(i), (ii) or (iii).
          (c) The Buyer Indemnified Parties shall use their reasonable best
efforts to limit the amount of Damages that may be payable by Seller pursuant to
Section 8.2(a)(v), and shall not take any action to accelerate the timing of
payment, or increase the amount, of any Damages payable pursuant to
Section 8.2(a)(v).
ARTICLE IX
MISCELLANEOUS PROVISIONS
          Section 9.1 Disclosure Letters. The Seller Disclosure Letter and the
Buyer Disclosure Letter are incorporated into this Agreement by reference and
made a part hereof.
          Section 9.2 Payments. All payments set forth in this Agreement and the
Related Agreements are in United States Dollars. Such payments shall be made by
wire transfer of immediately available funds or by such other means as the
parties to such payment shall designate.
          Section 9.3 Expenses. Except as expressly set forth herein, or as
agreed upon in writing by the parties, whether or not the transactions
contemplated hereby are

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consummated, each party shall bear its own costs, fees and expenses, including
the expenses of its representatives, incurred by such party in connection with
this Agreement and the Related Agreements and the transaction contemplated
hereby and thereby.
          Section 9.4 Choice of Law. THIS AGREEMENT, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OR CHOICE OF LAWS OR ANY OTHER LAW THAT WOULD MAKE THE LAWS OF ANY
OTHER JURISDICTION OTHER THAN THE STATE OF NEW YORK APPLICABLE HERETO.
          Section 9.5 Assignment. This Agreement may not be assigned by either
party without the prior written consent of the other party; provided, however,
that without the prior written consent of the other party, each party shall have
the right to assign its rights and obligations under this Agreement to any third
party successor to all or substantially all of its entire business.
          Section 9.6 Notices. All demands, notices, consents, approvals,
reports, requests and other communications hereunder must be in writing, will be
deemed to have been duly given only if delivered personally or by facsimile
transmission (with confirmation of receipt) or by an internationally-recognized
express courier service or by mail (first class, postage prepaid) to the parties
at the following addresses or telephone or facsimile numbers and will be deemed
effective upon delivery; provided, however, that any communication by facsimile
shall be confirmed by an internationally-recognized express courier service or
regular mail.

         
 
  (i)   If to Seller:
 
       
 
      CMS Enterprises Company
 
      One Energy Plaza
 
      Jackson, Michigan 49201
 
      Attention: General Counsel
 
      Telephone: (517) 788-0550
 
      Facsimile: (517) 788-1671
 
       
 
      With a required copy to:
 
       
 
      Skadden, Arps, Slate, Meagher & Flom LLP
 
      Four Times Square
 
      New York, NY 10036
 
      Attention: Sheldon S. Adler, Esq.
 
     
Marie L. Gibson, Esq.
 
      Telephone: (212) 735-3000
 
      Facsimile: (212) 735-2000

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  (ii)   If to Buyer:
 
       
 
      Abu Dhabi National Energy Company PJSC
 
      ADWEA Research Building
 
      7th Floor
 
      Jawazat Street
 
      P.O. Box 55224
 
      Emirate of Abu Dhabi
 
      United Arab Emirates
 
      Attention: Peter Barker Homek
 
      Telephone: + 971 (2) 694 3662
 
      Facsimile: + 971 (2) 642 2555
 
       
 
      With a required copy to:
 
       
 
      Simmons & Simmons
 
      The ADNIC Building
 
      Khalifa Street
 
      P.O. Box 5931
 
      Emirate of Abu Dhabi
 
      United Arab Emirates
 
      Attention: Ibrahim Mubaydeen
 
      Telephone: + 971 2 627 5568
 
      Facsimile: + 972 2 627 5223

or to such other address as the addressee shall have last furnished in writing
in accord with this provision to the addressor.
          Section 9.7 Resolution of Disputes. Except for the resolution of
disputes which shall be resolved in accordance with the procedures set forth in
Sections 5.7 and 8.5 herein (which shall be governed only by subsection (d) of
this Section 9.7), all disputes arising out of or relating to this Agreement or
any Related Agreement or the breach, termination or validity thereof or the
parties’ performance hereunder or thereunder (“Dispute”) shall be resolved as
provided by this Section 9.7.
               (a) If the Dispute has not been resolved by executive officer
negotiation within thirty (30) days of the disputing party’s notice requesting
negotiation, or if the parties fail to meet within twenty (20) days from
delivery of said notice, such Dispute shall be submitted to and finally settled
by arbitration in accordance with the Rules of Arbitration of the International
Chamber of Commerce (the “ICC”) then in effect (the “Rules”), except as modified
herein.
               (b) The arbitration shall be held, and the award shall be
rendered in London, England, in the English language. There shall be three
arbitrators, one of whom shall be nominated by each of Buyer and Seller in
accordance with the Rules. The two party appointed arbitrators shall have thirty
(30) days from the confirmation of the

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nomination of the second arbitrator to agree on the nomination of a third
arbitrator who shall serve as chair of the arbitral tribunal. On the request of
any party, any arbitrator not timely appointed in accordance with this Agreement
or the Rules shall be appointed by the ICAICC.
               (c) The award shall be final and binding upon the parties as from
the date rendered and shall be the sole and exclusive remedy between the parties
regarding any claims, counterclaims, issues, or accounting presented to the
arbitral tribunal. The parties hereby expressly agree that leave to appeal under
Section 45 or Section 69 of the English Arbitration Act 1996 may not be sought
with respect to any question of law arising in the course of the arbitration or
with respect to any award made. Judgment upon any award may be entered and
enforced in any court having jurisdiction over a party or any of its assets. For
the purpose of the enforcement of an award, the parties irrevocably and
unconditionally submit to the jurisdiction of a competent court in any
jurisdiction in which a party may have assets and waive any defenses to such
enforcement based on lack of personal jurisdiction or inconvenient forum. This
Agreement and the rights and obligations of the parties shall remain in full
force and effect pending the award in any arbitration proceeding hereunder.
               (d) The Parties agree that any court action or proceeding to
compel or in support of arbitration or for provisional remedies in aid of
arbitration, including any action to enforce the provisions of this Section 9.7
or for temporary injunctive relief to maintain the status quo or prevent
irreparable harm prior to the appointment of the arbitral tribunal, shall be
brought exclusively in the federal or state courts located in London, England
(the “London Courts”). The Parties hereby unconditionally and irrevocably submit
to the exclusive jurisdiction of the London Courts for such purpose and to the
non-exclusive jurisdiction of the London Courts in any action to enforce any
arbitration award rendered hereunder, and waive any right to stay or dismiss any
such actions or proceedings brought before the London Courts on the basis of
forum non conveniens or improper venue. Without prejudice to such provisional
remedies as may be available under the jurisdiction of a national court, the
arbitral tribunal shall have full authority to grant provisional remedies and to
direct the parties to request that any court modify or vacate any temporary or
preliminary relief issued by such court, and to award damages for the failure of
any party to respect the arbitral tribunal’s orders to that effect. The parties
hereby irrevocably waive any and all rights to trial by jury in any such action
or proceeding.
          Section 9.8 Language. The parties confirm that it is their wish that
this Agreement, the Related Agreements and any other documents related hereto or
thereto, including notices, schedules and authorizations, have been and shall be
drawn up in the English language only.
          Section 9.9 No Right of Setoff. Neither party hereto nor any Affiliate
thereof may deduct from, set off, holdback or otherwise reduce in any manner
whatsoever any amount owed to it hereunder or pursuant to any Related Agreement
against any amounts owed hereunder or pursuant to any Related Agreement by such
Persons to the other party hereto or any of such other party’s Affiliates.

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          Section 9.10 Time is of the Essence. Time is of the essence in the
performance of the provisions of this Agreement.
          Section 9.11 Limitation on Liability. In the event that a party
breaches this Agreement prior to, or in the absence of, Closing, neither party’s
liabilities hereunder shall exceed $100,000,000 in the aggregate.
          Section 9.12 Entire Agreement. This Agreement, including the Seller
Disclosure Letter, Buyer Disclosure Letter, and Schedules hereto, together with
the Related Agreements and the Confidentiality Agreement constitute the entire
agreement between the parties hereto with respect to the subject matter herein
and supersede all previous agreements, whether written or oral, relating to the
subject matter of this Agreement and all prior drafts of this Agreement, all of
which are merged into this Agreement. No prior drafts of this Agreement and no
words or phrases from any such prior drafts shall be admissible into evidence in
any action or suit involving this Agreement. In the case of any material
conflict between any provision of this Agreement and any other Related
Agreement, this Agreement shall take precedence.
          Section 9.13 Binding Nature; Third Party Beneficiaries. This Agreement
shall be binding upon and inure solely to the benefit of the parties hereto and
their respective successors (whether by operation of law or otherwise) and
permitted assigns. Except as expressly provided herein, none of the provisions
of this Agreement shall be for the benefit of or enforceable by any third party,
including any creditor of either party or any of their Affiliates. Except as
expressly provided herein, no such third party shall obtain any right under any
provision of this Agreement or shall by reasons of any such provision make any
Claim in respect of any Liability (or otherwise) against either party hereto.
          Section 9.14 Counterparts. This Agreement may be executed in two
(2) or more counterparts, each of which, when executed, shall be deemed to be an
original and both of which together shall constitute one and the same document.
          Section 9.15 Severability. If any provision of this Agreement is held
to be illegal, invalid or unenforceable under any applicable present or future
law, and if the rights or obligations of either party under this Agreement will
not be materially and adversely affected thereby, (i) such provision shall be
fully severable, (ii) this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
(iii) the remaining provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom and (iv) in lieu of such illegal, invalid
or unenforceable provision, there shall be added automatically as a part of this
Agreement, a legal, valid and enforceable provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible.
          Section 9.16 Headings. The headings used in this Agreement have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.

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          Section 9.17 Waiver. Any term or condition of this Agreement may be
waived at any time by the party that is entitled to the benefit thereof, but no
such waiver shall be effective unless set forth in a written instrument duly
executed by or on behalf of the party or parties waiving such term or condition.
No waiver by any party of any term or condition of this Agreement, in any one or
more instances, shall be deemed to be or construed as a waiver of the same or
any other term or condition of this Agreement on any future occasion. All
remedies, either under this Agreement or by law or otherwise afforded, will be
cumulative and not alternative.
          Section 9.18 Amendment. This Agreement may be altered, amended or
changed only by a writing making specific reference to this Agreement and signed
by duly authorized representatives of each party.

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     IN WITNESS WHEREOF, Seller and Buyer, by their duly authorized officers,
have executed this Agreement as of the date first written above.

            CMS ENTERPRISES COMPANY
      By:   /s/ Thomas J. Webb         Name:   Thomas J. Webb        Title:  
Executive Vice President and Chief Financial Officer   

            ABU DHABI NATIONAL ENERGY COMPANY PJSC
      By:   /s/ Peter E. Barker Homek         Name:   Peter E. Barker Homek     
  Title:   Chief Executive Officer     

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Exhibit A

EXECUTION VERSION
BUYER ACCESS AND SUPPORT AGREEMENT
     BUYER ACCESS AND SUPPORT AGREEMENT, dated as of May 2, 2007 (this
“Agreement”), by and between CMS Enterprises Company (“Seller”), a Michigan
corporation, and Abu Dhabi National Energy Company PJSC, a United Arab Emirates
public joint stock company (“Acquiror”).
     WHEREAS, pursuant to an Agreement of Purchase and Sale, dated as of
February 3, 2007, by and between Seller and Acquiror (“Purchase Agreement”),
Seller has agreed to sell to Acquiror, and Acquiror has agreed to purchase from
Seller, all of the issued and outstanding limited liability interests of CMS
Generation LLC, a Michigan limited liability company (together with its
Subsidiaries, “Generation”);
     WHEREAS, Generation, through its Subsidiaries, indirectly holds ownership
interests in the following energy projects: Jorf, Jubail, Neyveli, Shuweihat,
Takoradi and Taweelah (collectively, the “Projects”);
     WHEREAS, pursuant to the Purchase Agreement, Acquiror (i) has the right and
obligation to investigate, prosecute and defend certain matters set forth in
Section 8.2(a)(v) of the Seller Disclosure Letter and (ii) will be responsible
for certain other litigation matters involving Generation and the Projects
relating to the period prior to Closing (collectively, the “Proceedings”);
     WHEREAS, in the normal course of investigating, prosecuting and/or
defending the Proceedings, Acquiror and its counsel have, and will continue to
have, a need (i) to refer to, and to use as evidence, certain books, records and
other data, including electronic data maintained in computer files, relating to
Generation or the Projects in the possession of Seller and (ii) for the support
and cooperation of former employees of Generation or the Projects and current
employees of Seller or its Affiliates, in the event that such persons’
assistance or participation is needed to aid in the defense or settlement of the
Proceedings;
     WHEREAS, Acquiror will have discretion and authority as described in this
Agreement to manage all litigation, activities and negotiations associated with
the Proceedings; and
     WHEREAS, pursuant to the Purchase Agreement, Seller and Acquiror have
agreed to enter into this Agreement.
     NOW, THEREFORE, in consideration of the premises and covenants contained
herein and other good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged, Seller and Acquiror, intending to be bound
legally, agree as follows:
     Section 1. Definitions. For purposes hereof, capitalized terms used and not
otherwise defined herein shall have the respective meanings assigned to such
terms in the Purchase Agreement, unless the context hereof shall otherwise
require, and the same rules of construction as set forth under Section 1.2 of
the Purchase Agreement shall apply herein; provided that the following terms
shall have the following respective meanings:

 

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     “Acquiror Representatives” shall mean the respective directors, officers,
employees, agents, counsel, consultants, representatives, accountants and
auditors of Acquiror, Generation and the Projects.
     “Business” shall mean the business conducted by Generation and the Projects
after giving effect to the transactions contemplated by the Purchase Agreement.
     “Claims Data” shall mean all material and relevant current and historical
sales records, customer files, contract records, accounting records,
intercompany and intracompany communications, communications with any
Governmental Authority, requests and responses to requests, construction,
planning, engineering and operational documents, market studies or evaluations,
and all other data (including, without limitation, electronic data maintained in
computer files) of the Seller or its Affiliates relating to or associated with
the Proceedings.
     “Seller’s Representatives” shall mean Seller’s respective directors,
officers, employees, agents, counsel, consultants, representatives, accountants
and auditors.
     Section 2. Control of Settlements and Disputes; Further Cooperation.
          (a) From and after the Closing Date, Acquiror shall have complete
control over and shall have the sole and absolute right to conduct and control
all negotiations and activities with respect to the Proceedings and all other
aspects of investigation, prosecution and/or defense of the Proceedings. Such
control shall include without limitation (i) preparing and filing all pleadings,
motions and other documents filed with or provided to any court or other
tribunal, (ii) preparing and sending or delivering all correspondence or other
documents provided to any party in connection with the Proceedings,
(iii) preparing, responding to and serving all discovery and discovery responses
(and related matters), (iv) negotiating and, subject to Section 2(b) hereof,
entering into any settlement or compromise agreement (including on behalf of
Seller, Generation or the Projects) with any party in connection with the
Proceedings and making all decisions with respect to the defense of the
Proceedings, (v) selecting legal counsel, experts, accountants and other
advisors or representatives to represent Seller, Generation or the Projects
and/or to assist Acquiror with respect to the Proceedings and (vi) taking any
and all such other actions as may be necessary, appropriate or deemed helpful by
Acquiror in its sole and absolute discretion in order to effectuate the
foregoing. Seller will notify Acquiror promptly of all matters relating to the
Proceedings and will not, except with the prior written consent of Acquiror,
make any payment of, or settle or offer to settle, consent to any compromise,
make any admissions, file any pleadings, motions or documents, send any
correspondence or respond to or serve any discovery requests with respect to the
Proceedings.
          (b) To the extent that any settlement or compromise agreement entered
into with respect to the Proceedings would require Seller or any of its
Affiliates to provide any consideration, monetary or non-monetary (either
directly or pursuant to its indemnification obligations set forth in Section
8.2(a) of the Purchase Agreement), then such settlement or compromise shall
require the approval of Seller, which shall not be unreasonably withheld.

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          (c) Subject to paragraph (b) above, Seller or its Affiliates shall
cause appropriate officers, duly authorized to act on behalf of Seller or its
Affiliates, to execute (at Acquiror’s cost) any documents and instruments
necessary or appropriate in connection with any investigation, settlement or
compromise relating to, or the defense of, the Proceedings, including without
limitation any settlement agreement and general release.
     Section 3. Seller’s Obligation to Maintain Records. Seller shall maintain
and preserve in a manner and at a level consistent in all material respects with
the manner and level applied immediately prior to the Closing Date, unless
otherwise directed by a court order or governmental authority, and shall cause
the Seller Representatives to, maintain and preserve all Claims Data until this
Agreement is terminated in accordance with Section 9 hereof or until such time
as Acquiror shall notify Seller in writing that it is no longer necessary to
maintain such Claims Data. Seller shall not, and shall cause the Seller
Representatives not to, destroy or dispose of the Claims Data, unless consented
to in writing by Acquiror. Seller may move the Claims Data from its location(s)
as of the Closing Date, provided that it notifies the Acquiror in writing of
such new location.
     Section 4. Access to Claims Data. In connection with the defense,
prosecution or settlement of the Proceedings, Seller shall, and shall cause the
Seller Representatives to, reasonably cooperate with and give Acquiror or the
Acquiror Representatives access to all Claims Data during regular business
hours, and upon five (5) days prior written notice, at Seller’s principal place
of business or at any location where such Claims Data is located, and Acquiror
shall have the right, at its own expense, to make copies of such Claims Data.
Seller shall make available to Acquiror or the Acquiror Representatives, upon
written request and at Acquiror’s expense, Seller’s personnel to provide
reasonable assistance (provided such assistance shall not materially affect the
normal operations of Seller or its business) to Acquiror or the Acquiror
Representatives in locating and obtaining any Claims Data maintained by Seller.
     Section 5. Cooperation in Litigation. Seller shall (a) make available to
Acquiror or the Acquiror Representatives (provided such assistance shall not
materially affect the normal operations of Seller or its business), upon five
(5) days written request, any relevant employee of Seller from time to time
necessary to authenticate the Claims Data, or any employee of Seller whose
assistance or participation is reasonably required by Acquiror or the Acquiror
Representatives in anticipation of, or in the investigation of or preparation
for the defense or settlement of the Proceeding; provided that no employee or
agent of the Acquiror or one of its Affiliates can reasonably provide the
assistance requested from the employee of Seller, and (b) provide reasonable
assistance to Acquiror in locating any employee who is no longer employed by
Seller whose assistance or participation is reasonably required by Acquiror or
the Acquiror Representatives in anticipation of, or in the investigation of or
preparation for the defense or settlement of the Proceedings. Acquiror shall pay
all reasonable out of pocket costs and expenses arising from such assistance or
participation by such employee of Seller. Acquiror shall use their reasonable
best efforts to minimize the interference with the duties of such employee of
Seller caused by such assistance or participation.
     Section 6. Insurance. Seller hereby assigns, transfers and conveys to
Acquiror all rights, benefits and causes in action under all insurance policies
(the “Insurance Policies”) maintained

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by or for the benefit of Generation or any Project to the extent such Insurance
Policies obligate (or potentially obligate) the insurers to defend or indemnify
any insureds therein in connection with, arising from or related to the
Proceedings. Seller agrees that Acquiror may pursue any claims and make any
demands to any insurer under the Insurance Policies in the name of Seller to
receive and enjoy the full benefits of this provision to the fullest extent
permitted by law. Seller further agrees to immediately deliver to Acquiror all
proceeds, payments or benefits received from any insurer under the Insurance
Policies to the extent such proceeds, payments or benefits are made in
connection with, arising from or relating to the Proceedings.
     Section 7. Indemnification. In the event Seller fails to perform or comply
with any of its covenants and obligations described in hereunder, Acquiror shall
promptly provide Seller with written notice of the assertion of such
non-performance or non-compliance, such notice shall be given in accordance with
Section 9.6 of the Purchase Agreement and shall specify, in reasonable detail,
the nature of such breach. Subject to Section 8 of this Agreement, the
provisions of Article VIII of the Purchase Agreement shall apply to the
indemnification for breach of this Agreement by Seller, and by this reference
such provisions of Article VIII of the Purchase Agreement are incorporated
herein as if set forth in full herein. The obligation of Acquiror to indemnify
the Seller Indemnified Parties pursuant to Section 8.2 of the Purchase Agreement
shall not apply to the extent such Damages are attributable to Seller’s failure
to comply with this Agreement. The remedies available to Acquiror under this
Section 7 are in addition to those available to it under Section 8.
     Section 8. Specific Performance. The parties hereto agree that irreparable
damage will occur if any of Seller’s covenants under this Agreement is not
performed in accordance with its specific terms or otherwise is breached, and
that Acquiror may not have an adequate remedy at law in respect of such
non-performance or breach. It is accordingly agreed that Acquiror shall be
entitled to an injunction or injunctions to prevent any non-performance or
breach of this Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having jurisdiction, in
addition to any other remedy to which they are entitled at law or in equity. In
addition, Seller agrees not to assert any defense against an action for specific
performance of Seller’s covenants under this Agreement.
     Section 9. Survival; Modification, Termination and Waiver. This Agreement
shall remain in full force and effect until the earlier of (a) the written
consent of the parties hereto to terminate this Agreement, or (b) 30 days after
termination of the Proceedings by a binding settlement or a final court order,
not subject to appeal or review. This Agreement may be amended, supplemented or
modified, and any provision hereof may be waived, only pursuant to a written
instrument making specific reference to this Agreement signed by the parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed to
or shall constitute a waiver of any other provision hereof (whether or not
similar). No delay on the part of Acquiror in exercising any right, power or
privilege hereunder shall operate as a waiver thereof.
     Section 10. Notices. All notices and other communications under this
Agreement shall be in writing, shall refer to this Agreement, and shall
otherwise be given in accordance with Section 9.6 of the Purchase Agreement.

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     Section 11. Governing Law. This Agreement, including all maters of
construction, validity and performance, shall be governed by and construed in
accordance with the law of the State of New York without regard to the
principles of conflicts of laws or any other law that would make the laws of any
other jurisdiction other than the State of New York applicable hereto.
     Section 12. Binding Effect; No Assignment. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. No assignment of this Agreement or of any rights or
obligations hereunder may be made by any party (by operation of law or
otherwise) without the prior written consent of the other party hereto, which
consent may be withheld or granted by such party in its sole discretion,
provided that such consent may not be unreasonably withheld or delayed by
Acquiror if Seller complies with the provision of the last sentence of this
Section 12. Any attempted assignment without required consents shall be void. In
the event Seller proposes to sell all or substantially all of the assets of its
business at any time subsequent to the date hereof, Seller shall provide
Acquiror notice of such sale as soon as reasonably practicable, whereupon
Acquiror shall have the right, at its option and expense, upon written notice to
Seller, to make copies of any Claims Data (whether prior to or following such
sale) for a reasonable period of time following receipt of such notice. Seller
will cause such purchaser to assume Seller’s obligations under this Agreement
utilizing a written instrument reasonably satisfactory to Acquiror.
     Section 13. Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any applicable present or future law,
and if the rights or obligations of either party under this Agreement will not
be materially and adversely affected thereby, (a) such provision shall be fully
severable, (b) this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
(c) the remaining provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom and (d) in lieu of such illegal, invalid
or unenforceable provision, there shall be added automatically as a part of this
Agreement, a legal, valid and enforceable provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible.
     Section 14. Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which, when executed, shall be deemed an original, and all
of which together shall constitute one and the same Agreement.
     Section 15. Entire Agreement. This Agreement, including the Purchase
Agreement, the Seller Disclosure Letter, Buyer Disclosure Letter, and Schedules
thereto, together with the other Related Agreements and the Confidentiality
Agreement constitute the entire agreement between the parties hereto with
respect to the subject matter herein and supersede all previous agreements,
whether written or oral, relating to the subject matter of this Agreement and
all prior drafts of this Agreement, all of which are merged into this Agreement.
No prior drafts of this Agreement and no words or phrases from any such prior
drafts shall be admissible into evidence in any action or suit involving this
Agreement.

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     Section 16. Headings. The headings used in this Agreement have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.
     Section 17. Consent to Jurisdiction; Exclusive Forum. All disputes arising
out of or relating to this Agreement or the breach, termination or validity
thereof or the parties’ performance hereunder shall be resolved as provided by
Section 9.7 of the Purchase Agreement.

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     IN WITNESS WHEREOF, the parties hereto have executed this Access and
Support Agreement as of the date and year first written above.

                  CMS ENTERPRISES COMPANY    
 
           
 
  By:        
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   
 
                ABU DHABI NATIONAL ENERGY COMPANY PJSC    
 
           
 
  By:        
 
  Name:  
 
Peter Barker Homek    
 
  Title:   Chief Executive Officer    

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Exhibit B
EXECUTION VERSION
          THIS LICENSE AGREEMENT (this “Agreement”), dated as of May 2, 2007
(the “Effective Date”), by and among CMS Enterprises Company, a Michigan
corporation (“CMS”) and Abu Dhabi National Energy Company PJSC, a United Arab
Emirates public joint stock company (“Licensee”). CMS and Licensee are
hereinafter referred to collectively as the “Parties” or individually as a
“Party”. Initially capitalized terms defined in this Agreement shall have the
meaning ascribed to them herein.
          WHEREAS, CMS and Licensee have entered into an Agreement of Purchase
and Sale (the “Purchase Agreement”) dated February 3, 2007; and
          WHEREAS, in connection with the Purchase Agreement, Licensee desires
to receive from CMS, (i) a limited license during the Term to use the name and
mark CMS GENERATION CO. (the “Mark”) in countries and jurisdictions located
outside of the Western Hemisphere (i.e. all countries and jurisdictions of
North, South and Central America, and all related islands generally considered
to be in the Western Hemisphere) (the “Territory”) solely in connection with
Licensee’s electric generation business (the “Business”), and (ii) a perpetual
license to use all intellectual property rights owned by CMS in the items set
forth on Schedule A (the “Licensed IP”) solely for Licensee’s internal use in
the Business, on the terms and subject to the conditions of this Agreement.
          NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants contained herein, the Parties hereby agree as follows:
1. License
1.1 CMS hereby grants to Licensee (i) solely during the Term and subject to the
terms and conditions of this Agreement, a limited, non-exclusive,
non-transferable, non-sublicenseable, paid-up and royalty-free license to use
the Mark solely in the Territory in connection with the conduct of the Business,
and (ii) a perpetual, worldwide, non-exclusive, paid-up and royalty-free license
to use the Licensed IP solely for Licensee’s internal use in the Business
(collectively, the “License”). For the avoidance of doubt, the Mark shall
include only the word mark CMS GENERATION and shall not include any of CMS’s or
its affiliates’ logos, designs, symbols, or slogans (“Related Marks”).
1.2 Licensee may (i) only use the Mark in the same manner, including in the same
style, typeface and graphic appearance, depicted on Schedule B, and (ii) not
combine the Mark with any other logo, design, symbol, trademark, service mark,
company or corporate name or slogan or with any prefix or suffix.
1.3 Licensee acknowledges and agrees that it has no rights to, and shall not,
use the Mark or the Licensed IP except as expressly permitted herein. All rights
not expressly granted to Licensee herein are reserved to CMS.
1.4 Licensee acknowledges and agrees that the License in Section 1.1(ii) shall
only cover the Licensed IP as it exists as of the Effective Date and shall not
cover any modifications, improvements, fixes, patches and/or related
intellectual property developed by CMS to any Licensed IP subsequent to the
Effective Date. Nothing herein shall be construed to grant any license,
ownership, or rights of any kind to Licensee to any new versions, upgrades,
updates, patches, bug-fixes, or other iterations of the Licensed IP created
subsequent to the Effective Date by, or on behalf of, CMS, and nothing herein
shall be construed to require CMS to license, assign or provide any additional
materials, versions, upgrades, updates, batches, bug fixes, or any other items
created, developed, enhanced or improved after the Effective Date

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by, or on behalf of, CMS. Nothing herein shall be construed to grant any
license, ownership, or rights of any kind to CMS to any new versions, upgrades,
updates, patches, bug-fixes, or other iterations of the Licensed IP created
subsequent to the Effective Date by, or on behalf of, Licensee.
2. Ownership of the Mark
2.1 Licensee acknowledges that CMS is the owner of the Mark and the Licensed IP
throughout the world, and Licensee shall not challenge CMS’s ownership of the
Mark or the Licensed IP anywhere.
2.2 Licensee shall not acquire any ownership rights in the Mark or the Licensed
IP, or any other right adverse to CMS’s interests, by virtue of this Agreement
or by virtue of Licensee’s use of the Mark or the Licensed IP. Licensee agrees
that its use of the Mark under this Agreement shall inure to the benefit of CMS,
and this Agreement does not confer on Licensee any goodwill or ownership
interest in the Mark. Licensee hereby irrevocably assigns and transfers to CMS,
and its successors and assigns, any and all right, title and interest that
Licensee may have or otherwise acquire in and to all trademark, service mark, or
other proprietary rights in and to the Mark throughout the world.
2.3 Licensee shall not directly or indirectly: (i) use the Mark in any way that
may tend to impair its validity as a proprietary trademark or service mark;
(ii) take any action that would jeopardize or impair CMS’s ownership of the
Mark, or its legality and/or enforceability; (iii) apply for the registration or
renewal of registration of the Mark or any variation thereon, or any trademark,
service mark, trade name, symbol, word, or internet domain name (other than the
Domain Names) which contains or is similar to, the Mark; (iv) use, advertise or
promote any trademark, service mark, trade name, or internet domain name that is
confusingly similar to the Mark or any contraction or abbreviation thereof;
(v) use the Mark in any jurisdiction, including within the Territory, after such
time that Licensee knows or has reason to know that such use infringes or is
alleged to infringe the trademark rights or other proprietary rights of another
person, or (vi) use the Licensed IP after such time that Licensee knows or has
reason to know that such use infringes or otherwise violates the intellectual
property or other proprietary rights of another person (including any rights to
privacy or personal information).
3. Maintenance of Quality Control
3.1 Licensee shall not take any action, and/or shall cease taking any action,
that in any way might tend to disparage or reflect negatively upon, or diminish
the value of, the Mark or the reputation of CMS. Licensee acknowledges that upon
expiration or termination of this Agreement, no monetary value shall be
attributable to any goodwill associated with the use of the Mark by Licensee.
3.2 Licensee hereby covenants that in the course of conducting the Business
under the Mark, Licensee shall not use any of CMS’s or its affiliates’ Related
Marks.
3.3 Upon CMS’s request, Licensee shall submit to CMS for prior review and
written approval any materials (whether in written, electronic, or other form)
using the Mark in any manner other than that which has previously been approved
by CMS, which approval shall be in CMS’s reasonable discretion.
4. Compliance With Law; Licenses, Permits, Regulations, Registrations, Etc.
4.1 Licensee shall comply in all material respects with all applicable laws,
rules and regulations in connection with its use of the Mark and the Licensed
IP, and its business, products, and services operated or offered in connection
with the Mark.

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4.2 Licensee, at its sole expense, shall be responsible for obtaining and
maintaining all licenses, permits, and regulatory approvals which are required
by any executive, legislative, judicial, tribal, regulatory, taxing or
administrative agency, body, commission, department, board, court, tribunal,
arbitrating body or authority of the Territory or any country outside the
Territory, or any state, local or other governmental subdivision thereof
(“Governmental Authority”) with respect to this Agreement, and to comply with
any requirements of such Governmental Authorities. Upon CMS’s request, Licensee
shall furnish CMS written evidence from such regulatory authorities of any such
licenses, permits, clearances, authorizations, or regulatory approvals.
4.3 In the event CMS deems recordation necessary, Licensee shall cooperate with
CMS in connection with the recording of this Agreement with the appropriate
Governmental Authorities in the Territory and in the renewal of such
recordation. Licensee shall provide assistance and information to CMS as
reasonably necessary to accomplish such recordation, including by submitting a
revised version of this Agreement in a form necessary, but without change of
substance (except where such change is necessary for purposes of recordation)
hereof, for recordation. Upon expiration or termination of this Agreement, and
in addition to the requirements of Section 8.5, the Parties shall cooperate to
effect a cancellation or termination of any recordation of this Agreement with
the appropriate Governmental Authorities in the Territory and the Parties will
grant, and hereby do grant, to each other an irrevocable power of attorney
coupled with an interest to effect such cancellation within twenty (20) days
after the expiration or termination of this Agreement.
4.4 Upon expiration or termination of this Agreement and in addition to the
requirements of Section 8.5, Licensee hereby agrees, and shall cooperate with
CMS, to effect a cancellation or termination of any registration of Licensee of
the Mark as a company name with a Governmental Authority in the Territory, and
the Parties will grant, and hereby do grant, to each other an irrevocable power
of attorney coupled with an interest to effect such cancellation within twenty
(20) days after the expiration or termination of this Agreement.
4.5 Licensee may, at its sole expense and subject to CMS’s prior written
approval, register Internet domain names containing the Mark solely in the
Territory (i.e., a domain name with a country specific top-level domain that
expressly identifies a country within the Territory (i.e. www.cmsgeneration.it
for Italy) (the “Domain Names”) as internet domain names (but not as trademarks)
with an appropriate domain name registrar.
4.6 In addition to the requirements of Section 8.4(e) of this Agreement, upon
expiration or termination of this Agreement, Licensee hereby agrees to allow any
such registration for the Domain Names to lapse or, at the request of CMS, to
cancel or assign to CMS or its designated affiliate any such registration (if
possible) without any payment by CMS or its affiliates. In the event that any
such cancellation or assignment is not effectuated within thirty (30) days of
any request by CMS, Licensee shall, and hereby does, grant to CMS an irrevocable
power of attorney coupled with an interest, and shall otherwise cooperate with
CMS, to effect such cancellation or assignment.
5. Intellectual Property Protection
5.1 Licensee shall, at its own expense, notify CMS promptly after it becomes
aware thereof, of (i) any use or application or registration of any word,
phrase, symbol, logo or design, or any combination of any of the foregoing, that
might constitute infringement or other violation of the Mark in the Territory;
(ii) any claim of any rights in the Mark adverse to CMS’s interests in and to
such mark, or in any confusingly similar mark in the Territory or any claim that
Licensee’s use of the Mark infringes or otherwise violates the trademark rights
or other proprietary rights of any other person; or (iii) any claim of any
rights in the

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Licensed IP adverse to CMS’s interests in and to such intellectual property, or
any claim that Licensee’s use of the Licensed IP infringes or otherwise violates
the intellectual property or other proprietary rights of another person
(including any rights to privacy or personal information).
5.2 Licensee agrees, at its own expense and as CMS may reasonably request, to
(i) cooperate fully with CMS in the prosecution and elimination of any
unauthorized use or infringement or other violation of the Mark in the Territory
or the Licensed IP, including joining in a suit or proceeding against a person
making such unauthorized or infringing use; and (ii) execute any further
agreements or documents as may become necessary.
5.3 CMS shall have the sole right, in its sole discretion, to commence or
prosecute (or decide not to commence or prosecute) registration of the mark or
suits or proceedings against third parties with respect to the Mark and the
Licensed IP.
6. DISCLAIMER
6.1 CMS HEREBY SPECIFICALLY DISCLAIMS ANY AND ALL REPRESENTATIONS AND
WARRANTIES, EXPRESS OR IMPLIED (INCLUDING WITHOUT LIMITATION ANY IMPLIED
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY,
REGISTRABILITY, OR NON-INFRINGEMENT AND IMPLIED WARRANTIES ARISING FROM COURSE
OF DEALING OR COURSE OF PERFORMANCE), REGARDING THE MARK OR THE LICENSED IP.
WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, LICENSEE ACKNOWLEDGES THAT
(A) THE LICENSE GRANTED IN THIS AGREEMENT, THE MARK, AND THE LICENSED IP ARE
PROVIDED “AS IS,” AND (B) CMS SHALL NOT BE OBLIGATED TO PREPARE, CONVERT,
TRANSLATE, OR OTHERWISE PRESENT THE LICENSED IP IN ANY PARTICULAR FORMAT.
7. Defense and Indemnification
7.1 Licensee, at its expense, hereby agrees to defend, indemnify and hold
harmless CMS and its affiliates, and their respective directors, officers,
employees and agents with respect to any damages, losses, liabilities,
penalties, interest, judgments, assessments, costs and expenses, including
reasonable attorney’s fees and disbursements, incurred, arising from or based in
any respect on a claim by any third party arising, directly or indirectly, from
any use by Licensee of the Licensed IP, the Mark or the Domain Names (a
“Third-Party Claim”).
7.2 Licensee may, at its option, undertake the defense of a Third-Party Claim
for which it has an obligation to indemnify CMS pursuant to Section 7.1 by
representatives of its own choosing and shall provide written notice of any such
undertaking to CMS; provided, however, that CMS shall have complete control and
decision-making authority with respect to any Third-Party Claim to the extent it
relates to the validity or enforceability of the Mark. CMS shall, and shall
cause its employees and representatives to, reasonably cooperate with Licensee
in connection with the settlement or defense of such Third-Party Claim and shall
provide Licensee with all reasonably available information and documents
concerning such Third-Party Claim. Licensee shall provide CMS with copies of all
non-privileged communications and other information in respect of the
Third-Party Claim. If Licensee, within thirty (30) days after written notice of
any such Third-Party Claim, fails to assume the defense of such Third-Party
Claim, or, after assuming defense, fails to reasonably defend the same, CMS
shall (upon further written notice to Licensee) have the right to undertake the
defense, compromise or settlement of such Third-Party Claim on behalf of and for
the account and risk, and at the expense, of Licensee, subject

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to the right of Licensee to assume the defense of such Third-Party Claim at any
time prior to settlement, compromise or final determination thereof upon written
notice to CMS.
7.3 Anything in this Article 7 to the contrary notwithstanding, (a) CMS shall
not settle a Third-Party Claim for which it is indemnified without the prior
written consent of Licensee, which consent shall not be unreasonably withheld,
conditioned or delayed, and (b) Licensee shall not enter into any settlement or
compromise of any action, suit or proceeding, or consent to the entry of any
judgment for relief other than monetary damages to be borne by Licensee, without
the prior written consent of CMS, which consent shall not be unreasonably
withheld, conditioned or delayed; provided, however, that to the extent such
settlement, compromise, or consent to the entry of judgment for relief relates
to the validity or enforceability of the Mark, CMS’s consent may be withheld at
its sole discretion.
8. Term and Termination
8.1 This Agreement shall become effective on the Effective Date and shall
continue for a period of five (5) years, unless earlier terminated as provided
for in this Agreement (the “Term”).
8.2 CMS may terminate this Agreement immediately in case of occurrence of any of
the following events (provided, however, that the right to terminate this
Agreement pursuant to this Section 8.2 shall be without prejudice to the
enforcement of any other rights or remedies that CMS may have):
     (a) Licensee has failed to comply with or has breached any of the
provisions of Sections 2.1, 2.2, or 2.3 hereof;
     (b) (i) Licensee becomes insolvent, (ii) a liquidation committee or team
has been formed pursuant to the liquidation rules of the laws of any
jurisdiction in the Territory, or substantially all, of the property or assets
of Licensee is under custody by the liquidation committee or team, (iii) the
filing of a petition by, or of an involuntary petition against, Licensee occurs
under the provisions of any bankruptcy, insolvency or similar act, or
(iv) Licensee makes an assignment for the benefit of its creditors; or
     (c) all or a material part of Licensee’s assets are condemned,
expropriated, or otherwise taken over by a Governmental Authority or are
repossessed, foreclosed upon or otherwise seized by any Licensee creditor.
8.3 Licensee may terminate this Agreement at any time by giving CMS thirty
(30) days prior written notice.
8.4 If any Party fails to discharge a material obligation or to correct a
material default hereunder, CMS or Licensee may give written notice to such
Party specifying the material obligation or material default and indicating an
intent to terminate this Agreement if the material obligation is not discharged
or the material default is not cured. The Party receiving such notice shall have
twenty (20) days from the date of receipt of such notice to discharge such
material obligation or cure such material default. If such material obligation
is not discharged or such material default is not cured by the end of the twenty
(20) day period set forth immediately above, CMS or Licensee (if it is the
non-defaulting Party) may terminate this Agreement immediately by written notice
given at any time after the end of such period.
8.5 Upon the expiration or termination of this Agreement:

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     (a) Subject to Section 8.4(b), Licensee’s License to use the Mark
immediately and automatically shall terminate and all rights in the Mark granted
to Licensee, including any associated goodwill, under this Agreement, shall
revert to CMS;
     (b) Licensee shall, within thirty (30) days from the expiration or
termination of this Agreement (such period, the “Transitional Period”),
discontinue using the Mark and remove the Mark from all promotional and
advertisement materials, stationery, computer and electronic systems, and any
and all documents (whether in written, electronic, optical or other form) in the
possession and control of Licensee, and during the Transitional Period (the last
day of such period being the “Cessation Date”) all of the obligations of
Licensee hereunder shall remain in force; provided, however, that Licensee shall
not be required to remove the Mark from internal business records of Licensee;
     (c) Subject to Section 8.4(b), upon expiration of the Transitional Period,
Licensee shall destroy all materials utilizing the Mark and provide confirmation
of same to CMS;
     (d) Subject to Section 8.4(b), upon expiration of the Transitional Period,
Licensee shall not use any name or mark (including any URL or domain name) that
is confusingly similar to or dilutive of the Mark or any variation, derivation
or colorable imitation thereof, and at CMS’s request Licensee will assign any
rights to the Mark to CMS or an affiliate of CMS; and
     (e) Subject to Section 4.6, upon expiration of the Transitional Period,
Licensee shall remove all content from any Internet web site corresponding to
the Domain Names.
8.6 Upon expiration or termination of this Agreement, Licensee shall as soon as
reasonably practicable but in no event later than ninety (90) days following the
Cessation Date, (i) take all steps necessary, and fully cooperate with CMS
and/or its affiliates, to de-register the Licensee’s corporate name if it
includes the Mark and to cancel any recordation of this Agreement with any
Governmental Authorities in the Territory; and (ii) change its corporate name to
a name that does not include the Mark or any variation, derivation or colorable
imitation thereof.
8.7 Notwithstanding any provisions of this Article 8 stating otherwise,
Sections 1.1(ii), 4.3, 4.4, 4.6, 8.4, 8.5, and 8.6, and Articles 2, 7, 9, and 10
of this Agreement (and Sections 1.3, 4.1, 5.1, 5.2, and 5.3, solely to the
extent such provisions relate to the Licensed IP or Licensee’s use thereof)
shall survive any expiration or termination of this Agreement.
9. Confidentiality
9.1 Licensee shall maintain in confidence all non-public information or
confidential aspects of the Licensed IP (collectively, the “Confidential
Information”). Licensee shall not disclose or make available to any third party
such Confidential Information except for disclosure to Licensee’s employees,
vendors, contractors, parent, subsidiaries and representatives only to the
extent necessary to enable Licensee to exercise its rights hereunder. Prior to
Licensee’s disclosure of any Confidential Information to any such person as
expressly permitted herein, Licensee shall obtain prior written agreement from
any such person not already bound by a fiduciary or contractual duty or
obligation of confidentiality covering the Confidential Information to hold in
confidence and not make use of such Confidential Information for any purpose
other than those permitted or contemplated by this Agreement. Licensee shall use
at least the same standard of care as it uses to protect its own confidential
information with respect to, and will take all reasonable steps to ensure that
such employees, agents or consultants do not disclose or make any unauthorized
use, of such Confidential Information. Licensee shall promptly notify CMS upon
discovery of any unauthorized use or disclosure of the Confidential Information.

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9.2 Notwithstanding Section 9.1, Licensee may disclose Confidential Information
subject to and in accordance with this Section 9.2, pursuant to a subpoena or
order issued by a court, arbitrator or governmental body, agency or official. In
the event that Licensee shall receive a request to disclose any Confidential
Information under a subpoena or order, Licensee shall promptly notify CMS
thereof (to the extent not unlawful to do so), and CMS may at its expense take
steps to resist or narrow such request, or to obtain an order or other assurance
that confidential treatment will be accorded the Confidential Information that
is disclosed, and Licensee shall reasonably cooperate with CMS in connection
therewith. In the event that Licensee is ultimately compelled to disclose such
Confidential Information, Licensee shall use all reasonable efforts to cause
disclosure only of such minimal amount of Confidential Information as is
required to be so disclosed.
9.3 Licensee acknowledges and agrees that to the extent Licensee or its
affiliates, or their respective directors, officers, employees or agents obtains
knowledge of, possession of, or access to (1) “sensitive information” as
described in the 2007 Code of Conduct and Statement of Ethics of CMS Energy
Corporation (“Sensitive Information”), or (2) information or material that is
(a) privileged or otherwise protected under the attorney-client privilege or any
other applicable privilege or protection, or (b) is protected from discovery as
work product within the meaning of Rule 26 of the Federal Rules of Civil
Procedure (“Privileged Information”), in connection with this Agreement, such
knowledge, possession, and/or access shall not (x) operate as or constitute a
waiver of any attorney client, work product or other privilege belonging to CMS
or its affiliates relating to Privileged Information, (y) operate as or
constitute a waiver of any former CMS employee’s duty to maintain the
confidentiality of Sensitive Information, whether arising under common law, the
2007 Code of Conduct and Statement of Ethics of CMS Energy Corporation, any
confidentiality agreement, or any other requirement or obligation to maintain
confidentiality, nor (z) otherwise render the Sensitive Information anything
other than confidential information belonging exclusively to CMS. Upon obtaining
any such knowledge, access, or possession of Privileged Information, Licensee
shall (and shall cause it affiliates to) immediately notify CMS in writing of
any such knowledge, possession, and/or access to such Privileged Information,
and upon CMS’s request return and/or destroy such Privileged Information and
cease and, if applicable, block access thereto.
10. Miscellaneous
10.1 Notice. All demands, notices, consents, approvals, reports, requests and
other communications hereunder (each, a “Notice”) must be in writing, will be
deemed to have been duly given only if delivered personally or by facsimile
transmission (with confirmation of receipt) or by an internationally-recognized
express courier service or by mail (first class, postage prepaid) to the Parties
at the following addresses or telephone or facsimile numbers and will be deemed
effective upon delivery; provided, however, that any communication by facsimile
shall be confirmed by an internationally-recognized express courier service or
regular mail.

                  (i)   If to CMS:
 
                    CMS Enterprises Company         One Energy Plaza        
Jackson, Michigan 49201
 
      Attention: General Counsel  
 
      Telephone: (517) 788-0550   
 
      Facsimile: (517) 788-1671   
 
                    With a required copy to:

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                      Skadden, Arps, Slate, Meagher & Flom LLP         Four
Times Square         New York, NY 10036
 
      Attention: Sheldon S. Adler, Esq.  
 
     
Marie L. Gibson, Esq.
 
 
      Telephone: (212) 735-3000   
 
      Facsimile: (212) 735-2000   
 
                (ii)   If to Licensee:
 
                    Abu Dhabi National Energy Company PJSC         ADWEA
Research Building         7th Floor         Jawazat Street         P.O. Box
55224         Emirate of Abu Dhabi         United Arab Emirates
 
      Attention: Peter Barker Homek  
 
      Telephone: + 971 (2) 694 3662   
 
      Facsimile: + 971 (2) 642 2555   
 
                    With a required copy to:
 
                    Simmons & Simmons         The ADNIC Building         Khalifa
Street         P.O. Box 5931         Emirate of Abu Dhabi         United Arab
Emirates
 
      Attention: Ibrahim Mubaydeen  
 
      Telephone: + 971 2 627 5568   
 
      Facsimile: + 972 2 627 5223   

or to such other address as the addressee shall have last furnished in writing
in accord with this provision to the addressor.
10.2 Resolution of Disputes. All disputes arising out of or relating to this
Agreement or the breach, termination or validity thereof or the Parties’
performance hereunder shall be resolved as provided by Section 9.7 of the
Purchase Agreement
10.3 Specific Performance. The Parties hereto agree that irreparable damage
would occur in the event that any provision of this Agreement was not performed
in accordance with the terms hereof and that the Parties shall be entitled to
specific performance of the terms hereof and preliminary injunctive or other
equitable relief, in addition to any other remedy at law or equity.
10.4 No Agency. Subject to the power-of-attorney provisions of this Agreement:
(i) the Parties are acting as independent contractors under this Agreement, and
no Party is an employee or agent of the

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other; (ii) nothing herein is intended to make any Party a general or special
agent, legal representative, subsidiary, joint venturer, partner, fiduciary,
employee or servant of any other Party for any purpose; (iii) no Party is
authorized or empowered to act as an agent for any other Party or to enter into
Agreements, transact business, or incur obligations for or on behalf of any
other Party, nor to accept legal service of process for or on behalf of any
other Party, nor to bind any other Party in any manner whatsoever; (iv) no Party
shall do or omit to do anything that might imply or indicate that it is an agent
or representative of another Party, or a branch, division, or affiliate of any
other Party, or that such Party in any manner, either directly or indirectly,
owns, Controls, or operates any of the other Party’s business or is in any way
responsible for any other Party’s acts or obligations; provided, however, that
CMS may indicate that it licenses to Licensee rights to use the Mark.
10.5 Entire Agreement; Amendment. This Agreement (including the Schedule hereto,
which is hereby incorporated in the terms of this Agreement) constitutes the
entire agreement between the Parties hereto with respect to the subject matter
herein and supersedes all previous agreements, whether written or oral, relating
to the subject matter of this Agreement and all prior drafts of this Agreement,
all of which are merged into this Agreement. This Agreement may be altered,
amended or changed only by a writing making specific reference to this Agreement
and signed by duly authorized representatives of each Party.
10.6 No Waiver. Any term or condition of this Agreement may be waived at any
time by the Party that is entitled to the benefit thereof, but no such waiver
shall be effective unless set forth in a written instrument duly executed by or
on behalf of the Party or Parties waiving such term or condition. No waiver by
any Party of any term or condition of this Agreement, in any one or more
instances, shall be deemed to be or construed as a waiver of the same or any
other term or condition of this Agreement on any future occasion. All remedies,
either under this Agreement or by law or otherwise afforded, will be cumulative
and not alternative.
10.7 Severability. If any provision of this Agreement is held to be illegal,
invalid or unenforceable under any applicable present or future law, and if the
rights or obligations of either Party under this Agreement will not be
materially and adversely affected thereby, (i) such provision shall be fully
severable, (ii) this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
(iii) the remaining provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom and (iv) in lieu of such illegal, invalid
or unenforceable provision, there shall be added automatically as a part of this
Agreement, a legal, valid and enforceable provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible.
10.8 Governing Law. THIS AGREEMENT, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OR
CHOICE OF LAWS OR ANY OTHER LAW THAT WOULD MAKE THE LAWS OF ANY OTHER
JURISDICTION OTHER THAN THE STATE OF NEW YORK APPLICABLE HERETO.
10.9 No Assignment. Licensee may not assign or otherwise transfer its rights or
obligations under this Agreement or the License granted hereunder in whole or in
part (including by operation of law or change of control) without the express
prior written consent of CMS, which consent may be withheld in CMS’s sole and
absolute discretion. Any assignment or transfer in violation of the foregoing
sentence shall be void and of no force and effect.

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10.10 Binding Nature; No Third-Party Beneficiaries. This Agreement shall be
binding upon and inure solely to the benefit of the Parties hereto and their
respective permitted successors and assigns. None of the provisions of this
Agreement shall be for the benefit of or enforceable by any third party,
including any creditor of either Party or any of their affiliates.
10.11 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
10.12 Language. This Agreement (including the Schedule hereto) has been prepared
in the English language and may be translated into other languages of the
Territory if necessary for recordation in such jurisdiction or otherwise
required by a Governmental Authority; provided, however, that the English
language version shall control all questions of interpretation and performance
hereof. If there is any difference in meaning between any portion of the English
version and the other-language version or versions, the English version shall
prevail. Unless otherwise specifically required by law or by written agreement
of the Parties or as otherwise provided herein, all Notices and other
communications required or permitted under this Agreement shall be made in the
English language.
10.13 Further Assurances and Cooperation. Each Party agrees to execute and
deliver such other documents and to take all such other actions as the other
Party may reasonably request to effect the terms of this Agreement.
10.14 No Strict Construction; Headings. The language used in this Agreement
shall be deemed to be the language chosen by the Parties hereto to express their
mutual intent and no rule of strict construction against either Party shall
apply to any term or condition of this Agreement. The article and section
headings of this Agreement are for reference purposes only and are to be given
no effect in the construction or interpretation of this Agreement.
10.15 Interpretation. The words “herein”, “hereof” and “hereunder” and other
words of similar import refer to this Agreement as a whole, including the
Schedule hereto, as the same may from time to time be amended or supplemented
and not to any particular subdivision contained in this Agreement. The word
“including” when used herein is not intended to be exclusive, or to limit the
generality of the preceding words, and means “including, without limitation”.
References herein to an Article, Section, subsection, clause or Schedule shall
refer to the appropriate Article, Section, subsection, clause or Schedule of
this Agreement, unless expressly stated otherwise.

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          IN WITNESS WHEREOF, this Agreement has been duly executed on the day
and year first above written.

                  CMS ENTERPRISES COMPANY
 
           
 
  By:                    
 
      Name:
 
 
           
 
      Title:    
 
     
 
 
                ABU DHABI NATIONAL ENERGY COMPANY PJSC
 
           
 
  By:                    
 
      Name: Peter Barker Homek    
 
      Title: Chief Executive Officer    

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SCHEDULE A
LICENSED IP
All references to Generation in this Schedule A shall be to CMS Generation LLC,
a Michigan limited liability company, assuming the Reorganization (as defined in
the Purchase Agreement) has occurred.

§   HR Policies   §   Business Development Process   §   Transition Manual   §  
Operational Assessment Program   §   Environmental Health and Safety Program   §
  Document retention program   §   ILM Taxonomy and Policies   §   KPI
spreadsheet data (including historical data) solely to the extent related to
Generation   §   Current and historical photographs and marketing materials
solely to the extent related to Generation   §   The following electronic files:

      Plant Assessments solely to the extent related to Generation         Plant
Benchmarking solely to the extent related to Generation         Operating
Procedures solely to the extent such Operating Procedures are generic        
Plant Portfolio solely to the extent related to Generation         Project
Development solely to the extent (i) related to Generation, or (ii) such project
development is generic         2001 Safety Procedures Document
        Safety Manual

§   The Oracle Financials applications, data and databases provided to Licensee
in connection with the Transition Services Agreement (as defined in the Purchase
Agreement) during the Term (as defined in the Transition Services Agreement)

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SCHEDULE B
AUTHORIZED DEPICTION OF THE MARK
1. When appearing in text.
CMS Generation Co.
(If used in color must be in blue, specifically using the Pantone PMS 300 blue
(when printing in 1 color) or 100C and 43M (when printing in two color).

2

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EXHIBIT C

EXECUTION VERSION
 
TRANSITION SERVICES AGREEMENT
between
CMS ENTERPRISES COMPANY
and
ABU DHABI NATIONAL ENERGY COMPANY PJSC
Dated as of May 2, 2007
 

 

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TABLE OF CONTENTS

              Page  
ARTICLE I DEFINITIONS
    1  
Section 1.1 Definitions
    1  
ARTICLE II SERVICES
    2  
Section 2.1 Services
    2  
Section 2.2 Standard of Care
    2  
Section 2.3 Modification of Services
    2  
Section 2.4 Independence
    3  
Section 2.5 Non-Exclusivity
    3  
Section 2.6 Cooperation
    3  
Section 2.7 Limitation On Services
    3  
Section 2.8 Personnel
    3  
Section 2.9 Right To Determine Priority
    4  
Section 2.10 Contact Persons
    4  
ARTICLE III TERM AND TERMINATION
    4  
Section 3.1 Term
    4  
Section 3.2 Termination
    4  
Section 3.3 Effect Of Termination
    5  
ARTICLE IV COMPENSATION
    6  
Section 4.1 Service Charge
    6  
Section 4.2 Invoicing And Payments
    6  
Section 4.3 Taxes
    7  
Section 4.4 Disputed Amounts
    7  
ARTICLE V FORCE MAJEURE
    7  
Section 5.1 Event of Force Majeure
    7  
Section 5.2 Reasonable Efforts
    8  
ARTICLE VI LIABILITIES
    8  
Section 6.1 Consequential and Other Damages
    8  
Section 6.2 Limitation of Liability
    8  
Section 6.3 Indemnification
    8  
ARTICLE VII MISCELLANEOUS
    9  
Section 7.1 Notices
    9  
Section 7.2 Headings
    10  
Section 7.3 Waiver
    10  
Section 7.4 Amendment
    10  
Section 7.5 Counterparts
    10  
Section 7.6 Entire Agreement
    10  
Section 7.7 Governing Law
    11  
Section 7.8 Resolution of Disputes
    11  
Section 7.9 Assignment
    11  
Section 7.10 Binding Nature; Third-Party Beneficiaries
    11  
Section 7.11 Severability
    11  
Section 7.12 No Right of Setoff
    11  

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              Page  
Section 7.13 Currency
    12  
Section 7.14 Specific Performance
    12  
Section 7.15 Construction
    12  
Section 7.16 Confidentiality
    12  

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TRANSITION SERVICES AGREEMENT
          This TRANSITION SERVICES AGREEMENT (the “Agreement”), dated as of
May 2, 2007, by and between CMS Enterprises Company, a Michigan corporation
(“Seller”), and Abu Dhabi National Energy Company PJSC, a United Arab Emirates
public joint stock company (“Buyer”).
          WHEREAS, Buyer and Seller have entered into an Agreement of Purchase
and Sale, dated as of February 3, 2007 (the “Purchase Agreement”), pursuant to
which Seller has agreed to sell and Buyer has agreed to purchase all of the
issued and outstanding limited liability interests of CMS Generation LLC, a
[Delaware] limited liability company (together with its Subsidiaries,
“Generation”).
          WHEREAS, Generation, through its Subsidiaries, indirectly holds
ownership interests in (a) the following energy projects: Jorf, Jubail, Neyveli,
Shuweihat, Takoradi and Taweelah (collectively, the “Projects”).
          WHEREAS, in connection with the Purchase Agreement, Seller and Buyer
have agreed that Seller shall provide to Buyer the transition services described
herein (the “Transition Services”) in accordance with the terms and conditions
of this Agreement.
          NOW, THEREFORE, in consideration of the foregoing and the covenants
and agreements contained in this Agreement, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
          Section 1.1 Definitions. Capitalized terms not defined in this
Article I shall have the meanings ascribed to such terms in the Purchase
Agreement. As used in this Agreement, the following terms shall have the
following meanings:
          “Business” shall mean the business conducted by the Generation and the
Projects after giving effect to the Reorganization.
          “Contact Person,” with respect to a Service, shall mean the person set
forth opposite such Service on Schedule A, or such person’s successor or
substitute.
          “Service” or “Services” shall mean each of the services described in
Schedule A hereto to be provided by or on behalf of Seller to Buyer pursuant to
the terms and conditions of this Agreement.

 

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ARTICLE II
SERVICES
     Section 2.1 Services.
               (a) Subject to the terms of this Agreement, Seller shall provide,
or shall cause a Subsidiary of Seller to provide, to Buyer or a Subsidiary of
Buyer the Services during the Term in a manner and at a level of service
consistent in all material respects with the services provided to the Business
as it existed immediately prior to the Closing Date.
               (b) For each Service, the parties have set forth on Schedule A,
among other things, the time period during which the Service will be provided
(if different from the term of this Agreement determined pursuant to
Article III), a summary of the Service to be provided, a description of the
Service, the charge for the Service and any other terms applicable thereto.
               (c) Buyer understands that the Services provided hereunder are
transitional in nature and are furnished by Seller for the purpose of
facilitating the transactions contemplated by the Purchase Agreement. Buyer
further understands that Seller is not in the business of providing Services to
third parties and will not, unless otherwise agreed by the Seller and the Buyer
in writing, provide the Services beyond the applicable Term. Buyer agrees to
transition each Service to its own internal organization or other third party
service providers by the expiration of the applicable Term.
               (d) For the avoidance of doubt, Seller shall grant to Buyer, or
shall use its reasonable best efforts to cause Buyer to be granted, a
non-exclusive licence to use (but not to modify) any software used in connection
with the provision of the Services to the extent that a licence is needed for
Buyer to receive the benefit of the Services.
               (e) The Seller agrees that in the event following Closing, it
becomes apparent that Schedule A omits any services provided by Seller or its
Affiliates to Generation and the Projects immediately prior to Closing, Seller
shall, upon Buyer’s request, provide as soon as reasonably practicable such
other services on a basis consistent with Section 2.1(a) hereof.
               (f) For the avoidance of doubt, legal services shall not be
included in the Services.
          Section 2.2 Standard of Care. Seller shall provide such Services
exercising the same degree of care as it exercises in performing the same or
similar services for itself and its Affiliates.
          Section 2.3 Modification of Services. Schedule A identifies the
Services to be provided by Seller and, subject to the mutual agreement of the
parties hereto acting reasonably, it may be amended in writing from time to
time, to add any additional Services or to modify or delete Services.

2

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          Section 2.4 Independence.
               (a) Unless otherwise agreed in writing, all employees and
representatives of Seller shall be deemed for all purposes, including without
limitation, all compensation and employee benefits matters to be employees or
representatives of Seller and not employees or representatives of Buyer. In
connection with provision of the Services, the employees and representatives of
Seller shall be under the direction, control and supervision of Seller (and not
Buyer) and Seller shall have the sole right to exercise all authority with
respect to the employment (including termination of employment), assignment and
compensation of such employees and representatives.
               (b) Unless otherwise agreed in writing, all employees and
representatives of Buyer shall be deemed for purposes of all compensation and
employee benefits matters to be employees or representatives of Buyer and not
employees or representatives of Seller.
          Section 2.5 Non-Exclusivity. Nothing in this Agreement shall preclude
Buyer from obtaining, in whole or in part, services of any nature that may be
obtainable from Seller from its own employees or from providers other than
Seller.
          Section 2.6 Cooperation. Buyer shall, in a timely manner, take all
such actions as may be reasonably necessary or desirable in order to enable or
assist Seller in the provision of the Services, including providing necessary
information and specific written authorizations and consents, and Seller shall
be relieved of its obligations hereunder to the extent that Buyer’s failure to
take any such action renders performance by Seller of such obligations unlawful
or impracticable.
          Section 2.7 Limitation On Services. Seller shall not be required to
expand its facilities, incur new long-term capital expenses or employ additional
personnel in order to provide the Services to Buyer. Furthermore, Seller shall
not be obligated to provide Services hereunder that are significantly greater in
nature or scope than the comparable services provided by Seller to the Business
immediately prior to the Closing Date, or that are greater in nature or scope
than comparable services provided by Seller during the Term to its own internal
organizations.
          Section 2.8 Personnel.
               (a) In providing the Services, Seller as it deems necessary or
appropriate, acting reasonably, may (a) use the personnel of Seller or its
Affiliates or (b) employ the services of third parties to the extent such third
party services are routinely utilized to provide similar services to other
businesses of Seller or are reasonably necessary for the efficient performance
of any of such Services. Buyer may retain consultants and other professional
advisers at its sole expense.
               (b) Seller shall use its reasonable best efforts to ensure that
asset level employees employed by Seller or its Affiliates will be available to
support a twelve months transition; provided that Seller shall not be required
to offer retention arrangements or other special arrangements to such employees
in order to comply with its obligations hereunder.

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          Section 2.9 Right To Determine Priority. If there is an unavoidable
conflict between the immediate needs of Seller and those of Buyer as to the use
of or access to a particular Service, Seller shall have the right, acting
reasonably and upon consulting the Buyer, if practicable, to establish
reasonable priorities, at particular times and under particular circumstances,
as between Seller and Buyer. In any such situation, Seller shall provide notice
to Buyer of the establishment of such priorities at the earliest practicable
time.
          Section 2.10 Contact Persons. The Contact Person for each Service
shall deal with issues arising out of the performance by Seller of such Services
and facilitate orderly provision and receipt of such Service. Each party agrees
to provide reasonable access (in person, by telephone or electronically via
e-mail) during normal business hours to the appropriate Contact Person for
problem resolution.
ARTICLE III
TERM AND TERMINATION
          Section 3.1 Term. (a) This Agreement shall become effective on the
Closing Date and shall remain in force for a period of three (3) months (except
that Seller’s obligations under Section 2.8(b) shall remain in force for a
period of one (1) year) (such three (3) month period, or with respect to
Section 2.8(b) only, such one (1) year period, shall be referred to as the
“Term”), unless terminated earlier pursuant to Section 3.2 below.
               (b) If Buyer requests to extend the Term, Seller may, in its sole
discretion, agree to extend this Agreement.
               (c) Buyer shall not have any obligation to continue to use any of
the Services and may delete any Service from Schedule A by giving Seller thirty
(30) days notice thereof. In the event any Service is terminated by Buyer,
Schedule A shall be amended to reflect termination of such Services.
          Section 3.2 Termination. (a) Termination Without Cause. The obligation
of Seller to provide or cause to be provided each Service to be provided
hereunder shall terminate on the earliest to occur of:
               (i) the expiration of the Term;
               (ii) the expiration of the term (including any available renewal
term) during which such Service is to be provided as specified in Schedule A;
               (iii) the date thirty (30) days following written notice from
Seller that Seller is discontinuing permanently the provision of such Service to
its own internal organizations;
               (iv) the date thirty (30) days (or such longer period as is
specified in Schedule A) after Seller receives written notice that Buyer no
longer desires that such Service be provided; or

4

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               (v) the date of termination pursuant to Section 3.2(b) or 3.2(c).
               (b) Termination For Cause. Subject to Section 5.1, if either
party shall fail to perform in any material respect any of its material
obligations under this Agreement (other than a payment default) (the “Defaulting
Party”), the other party entitled to the benefit of such performance (the
“Non-Defaulting Party”) may give thirty (30) days’ written notice to the
Defaulting Party specifying the nature of such failure or default and stating
that the Non-Defaulting Party intends to terminate this Agreement, either in its
entirety or partially as set forth in Section 3.2(c), if such failure or default
is not cured within thirty (30) days of such written notice. If any failure or
default so specified is not cured within such 30-day period, the Non-Defaulting
Party may elect to immediately terminate this Agreement as set forth in this
Section 3.2(b) or Section 3.2(c); provided, however, that if the failure or
default relates to a dispute contested in good faith by the Defaulting Party,
the Non-Defaulting Party may not terminate this Agreement pending the resolution
of such dispute in accordance with Section 7.7. Such termination shall be
effective upon the giving of a written notice of termination by the
Non-Defaulting Party to the Defaulting Party and shall be without prejudice to
any other remedy which may be available to the Non-Defaulting Party against the
Defaulting Party.
               (c) Partial Termination. In the event that the Non-Defaulting
Party is entitled to terminate this Agreement pursuant to Section 3.2(b), the
Non-Defaulting Party shall have the following options to partially terminate
this Agreement upon the same notice provisions as specified in Section 3.2(b):
               (i) if the default relates to the payment for a Service, Seller
may terminate this Agreement as to the provision of that Service to Buyer, but
continue this Agreement in all other respects; or
               (ii) if the default relates to the provision of a Service, Buyer
may terminate this Agreement as to the provision of that Service by Seller, but
continue this Agreement in all other respects.
          Section 3.3 Effect Of Termination. (a) Buyer specifically agrees and
acknowledges that all obligations of Seller to provide each Service for which
Seller is responsible hereunder shall immediately cease upon the termination of
this Agreement. Upon the cessation of Seller’s obligation to provide any
Service, Buyer shall immediately cease using, directly or indirectly, such
Service (including any and all software of Seller or third party software
provided through Seller, telecommunications services or equipment, or computer
systems or equipment).
               (b) Upon termination of a Service with respect to which Seller
holds books, records or files, including current or archived copies of computer
files, owned by Buyer and used by Seller in connection with the provision of a
Service to Buyer, Seller will return all such books, records or files as soon as
reasonably practicable; provided, however, that Seller may make a copy, at its
expense, of such books, records or files for archival purposes only.

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               (c) Without prejudice to the survival of the other agreements of
the parties, the following obligations shall survive the termination of this
Agreement: (i) the obligations of each party under Section 3.3, Section 7.16 and
Article VI and (ii) Seller’s right to receive the Service Charges for the
Services provided by it hereunder pursuant to Section 4.1 incurred prior to the
effective date of termination.
ARTICLE IV
COMPENSATION
          Section 4.1 Service Charge. (a) Except for any third party costs
relating to item 5 of Schedule A hereto (which shall be Buyer’s responsibility),
Seller acknowledges that consideration for its provision of the Services for the
first three (3) months of the Term pursuant to this Agreement have been made
under the Purchase Agreement and hereby represents that such consideration is
good and sufficient consideration and waives any right to claim from the Buyer
additional consideration except as may be payable in relation to services
provided by Seller in addition to the Services.
               (b) In the event the term of this Agreement is extended pursuant
to Section 3.1(b), Seller shall provide the Services to Buyer at Seller’s cost
to so provide, plus an amount to be mutually agreed upon by the parties.
          Section 4.2 Invoicing And Payments. (a) Invoices. If the Term is
extended pursuant to Section 3.1(b), after the end of each month, Seller,
together with its Affiliates and/or Subsidiaries providing Services, will submit
one invoice to Buyer for all Services provided to Buyer and Buyer’s Subsidiaries
by Seller during such month. Such monthly invoices shall be issued when Seller
issues its invoices in the ordinary course of its business. Each invoice shall
include a summary list of the previously agreed upon Services for which there
are fixed dollar fees, together with documentation supporting each of the
invoiced amounts that are not covered by the fixed fee agreements. The total
amount set forth on such summary list and such supporting detail shall equal the
invoice total, and shall be provided under separate cover apart from the
invoice. All invoices shall be sent to the attention of Buyer at the address set
forth in Section 7.1 or to such other address as Buyer shall have specified by
notice in writing to Seller.
               (b) Payment. If the Term is extended pursuant to Section 3.1(b),
payment of all invoices in respect of the Services shall be made by check or
electronic funds transmission in U.S. Dollars, without any offset or deduction
of any nature whatsoever, within thirty (30) days of the invoice date. Invoices
unpaid as of such date shall accrue interest at an annual rate of the lower of
(i) two (2) percentage points higher that the rate equal to the NAT’L AVG of the
“Money market ann. Yield” as published in the Wall Street Journal on the first
business day of each applicable month or (ii) the highest possible rate allowed
by applicable law and the number of days elapsed since the date the invoice
became due. All payments shall be made to the account designated by Seller to
Buyer, with written confirmation of payment sent by facsimile to Seller or other
Person designated thereby. If any payment is not paid when due, Seller shall
have the right, without any liability to Buyer, or anyone claiming by or through
Buyer, upon thirty (30) days’ notice, to cease providing any or all of the
Services provided by Seller to Buyer, which right may be exercised by Seller in
its sole and absolute discretion.

6

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          Section 4.3 Taxes. To the extent not included directly in the price
Seller charges for Services, Buyer shall pay to Seller the amount of any taxes
or charges set forth in clauses (a) through (c) below that are imposed now or in
the future by any Governmental Authority, including any increase in any such tax
or charge imposed on Seller after the Closing Date and during the Term of this
Agreement:
               (a) Any applicable sales, use, gross receipts, value added or
similar tax that is imposed as a result of, or measured by, any Service rendered
hereunder unless covered by an exemption certificate;
               (b) Any applicable real or personal property taxes, including any
special assessments, and any impositions imposed on Seller in lieu of or in
substitution for such taxes on any property used in connection with any Service
rendered hereunder; and
               (c) Any other governmental taxes, duties and/or charges of any
kind, excluding any imposed on Seller that are determined by reference to net
income, which Seller is required to pay with respect to any Service rendered
hereunder.
          Section 4.4 Disputed Amounts. In the event Buyer disputes the accuracy
of any invoice, Buyer shall pay the undisputed portion of such invoice and the
parties hereto shall promptly meet and seek to resolve the disputed amount of
the invoice. If Buyer fails to pay any undisputed amount owed under this
Agreement, Buyer shall correct such failure promptly following notice of the
failure, and shall pay Seller interest on the amount paid late at an annual
interest rate equal to the lower of (i) two percentage points higher than the
rate equal to the NAT’L AVG of the “Money market ann. yield” as published in the
Wall Street Journal on the first business day of each applicable month or
(ii) the highest possible rate allowed by applicable law and the number of days
since the date the invoice became due.
ARTICLE V
FORCE MAJEURE
          Section 5.1 Event of Force Majeure. Seller shall not be liable to
Buyer for any interruption of Service or delay or failure to perform under this
Agreement when such interruption, delay or failure results from causes beyond
its reasonable control including, but not limited to: (a) acts of God, the
elements, epidemics, explosions, accidents, landslides, lightning, earthquakes,
fires, storms (including but not limited to tornadoes and hurricanes or tornado
and hurricane warnings), sinkholes, floods, or washouts; (b) labor shortage or
trouble including strikes or injunctions; (c) inability to obtain material,
equipment or transportation; or (d) national defense requirements, war,
blockades, insurrections, sabotage, riots, arrests and restraints of the
government, either federal or state, civil or military (including any
governmental taking by eminent domain or otherwise); or (e) any applicable law,
regulation or rule or the enforcement thereof by any governmental or regulatory
agency having jurisdiction, that substantially limits or that prevents Seller
from performing its obligations hereunder. In such event, the obligations
hereunder of Seller in providing any Service, and the obligation of Buyer to pay
for any such Service, shall be postponed for such time as its performance is
suspended or delayed on account

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thereof. Upon learning of the occurrence of such event of force majeure, Seller
shall promptly notify Buyer, either orally or in writing.
          Section 5.2 Reasonable Efforts. In the event of any failure,
interruption or delay in performance of the Services, whether excused or
unexcused, Seller shall use its reasonable best efforts to restore the Services
as soon as may be reasonably possible in accordance with its existing
contingency plans for such services.
ARTICLE VI
LIABILITIES
          Section 6.1 Consequential and Other Damages. Seller and its
Affiliates, and their respective officers, directors, employees, shareholders,
partners, representatives, consultants and agents (the “Seller Parties”) shall
not be liable to Buyer or its Affiliates, or their officers, directors,
employees, shareholders, partners, representatives, consultants or agents (the
“Buyer Parties”), whether in contract, tort (including negligence and strict
liability), or otherwise, for any special, indirect, incidental or consequential
damages whatsoever, which in any way arise out of, relate to, or are a
consequence of, Seller’s performance or nonperformance hereunder, or the
provision of or failure to provide any Service.
          Section 6.2 Limitation of Liability. Seller shall not be liable for
any claims, liabilities, damages, loses, costs, expenses (including settlements,
judgments, court costs, and regardless of whether legal proceedings are
instituted, reasonable attorneys’ fees), fines or penalties (“Losses”), which in
any way arise out of, relate to, or are a consequence of, Seller’s performance
or nonperformance hereunder, or the provision of or failure to provide any
Service, except if due to the wilful breach of this Agreement, gross negligence,
willful misconduct, bad faith or fraud by Seller or the Seller Parties. In the
absence of wilful breach of this Agreement, willful misconduct, bad faith or
fraud by Seller or the Seller Parties, in the event Seller commits an error with
respect to or incorrectly performs or fails to perform any Service, at Buyer ‘s
request, Seller shall use commercially reasonable efforts to correct such error
or re-perform or perform such Service at no additional cost to Buyer; provided,
that Seller shall have no obligation to recreate any lost or destroyed data to
the extent the same cannot be cured by the re-performance of the Service in
question.
          Section 6.3 Indemnification. (a) Buyer shall indemnify and hold
harmless the Seller Parties from and against any Losses that any of the Seller
Parties may sustain or incur by reason of any actual or threatened claim,
demand, suit or recovery by any person or entity arising or allegedly arising in
connection with this Agreement, unless such Loss arose out of the gross
negligence, willful misconduct, bad faith or fraud by the Seller Parties.
               (b) Subject to Sections 6.1 and 6.2, Seller shall indemnify and
hold harmless the Buyer Parties from and against any Losses that any of the
Buyer Parties may sustain or incur by reason of any actual or threatened claim,
demand, suit or recovery by any person or entity arising or allegedly arising in
connection with this Agreement during the initial three (3) month Term for
provision of Services, including, without limitation, any claim by a party
alleging that the use by Buyer or Buyer Parties of any intellectual property
materials provided by

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Seller in connection with its provision of the Services materially infringes the
rights of any third party.
ARTICLE VII
MISCELLANEOUS
          Section 7.1 Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including facsimile transmission) and
shall be given (a) by personal delivery to the appropriate address as set forth
below (or at such other address for the party as shall have been previously
specified in writing to the other party), (b) by reliable overnight courier
service (with confirmation) to the appropriate address as set forth below (or at
such other address for the party as shall have been previously specified in
writing to the other party), or (c) by facsimile transmission (with
confirmation) to the appropriate facsimile number set forth below (or at such
other facsimile number for the party as shall have been previously specified in
writing to the other party) with follow up copy by reliable overnight courier
service the next Business Day:
               (a) if to Buyer, to:
Abu Dhabi National Energy Company PJSC
ADWEA Research Building
7th Floor
Jawazat Street
P.O. Box 55224
Emirate of Abu Dhabi
United Arab Emirates
Attention: Peter Barker Homek
Telephone: + 971 (2) 694 3662
Facsimile: + 971 (2) 642 2555
          With a required copy to:
Simmons & Simmons
The ADNIC Building
Khalifa Street
P.O. Box 5931
Emirate of Abu Dhabi
United Arab Emirates
Attention: Ibrahim Mubaydeen
Telephone: + 971 2 627 5568
Facsimile: + 972 2 627 5223
          and
               (b) if to Seller, to:

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CMS Enterprises Company
One Energy Plaza
Jackson, Michigan 49201
Attention: General Counsel
Telephone: (517) 788-0550
Facsimile: (517) 788-1671
          With a required copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, NY 10036
Attention: Sheldon S. Adler, Esq.
                  Marie L. Gibson, Esq.
Telephone: (212) 735-3000
Facsimile: (212) 735-2000
          All such notices, requests and other communications shall be deemed
received on the date of receipt by the recipient thereof if received prior to 5
p.m. (New York City time) and such day is a Business Day in the place of
receipt. Otherwise, any such notice, request or communication shall be deemed
not to have been received until the next succeeding Business Day in the place of
receipt.
          Section 7.2 Headings. The headings used in this Agreement have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.
          Section 7.3 Waiver. Any term or condition of this Agreement may be
waived at any time by the party that is entitled to the benefit thereof, but no
such waiver shall be effective unless set forth in a written instrument duly
executed by or on behalf of the party or parties waiving such term or condition.
No waiver by any party of any term or condition of this Agreement, in any one or
more instances, shall be deemed to be or construed as a waiver of the same or
any other term or condition of this Agreement on any future occasion. All
remedies, either under this Agreement or by law or otherwise afforded, will be
cumulative and not alternative.
          Section 7.4 Amendment. This Agreement may be altered, amended or
changed only by a writing making specific reference to this Agreement and signed
by duly authorized representatives of each party.
          Section 7.5 Counterparts. This Agreement may be executed in two (2) or
more counterparts, each of which, when executed, shall be deemed to be an
original and both of which together shall constitute one and the same document.
          Section 7.6 Entire Agreement. This Agreement, including the Schedules
hereto, and the Purchase Agreement, Seller Disclosure Letter, Buyer Disclosure
Letter, and Schedules thereto, together with the other Related Agreements and
the Confidentiality Agreement constitute the entire agreement between the
parties hereto with respect to the subject matter herein and supersede all
previous agreements, whether written or oral, relating to the

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subject matter of this Agreement and all prior drafts of this Agreement, all of
which are merged into this Agreement. No prior drafts of this Agreement and no
words or phrases from any such prior drafts shall be admissible into evidence in
any action or suit involving this Agreement. In the case of any material
conflict between any provision of this Agreement and any other Related
Agreement, this Agreement shall take precedence.
          Section 7.7 Governing Law. THIS AGREEMENT, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OR CHOICE OF LAWS OR ANY OTHER LAW THAT WOULD MAKE THE LAWS OF ANY
OTHER JURISDICTION OTHER THAN THE STATE OF NEW YORK APPLICABLE HERETO.
          Section 7.8 Resolution of Disputes. All disputes arising out of or
relating to this Agreement or the breach, termination or validity thereof or the
parties’ performance hereunder shall be resolved as provided by Section 9.7 of
the Purchase Agreement.
          Section 7.9 Assignment. This Agreement may not be assigned by either
party without the prior written consent of the other party; provided, however,
that without the prior written consent of the other party, each party shall have
the right to assign its rights and obligations under this Agreement to any third
party successor to all or substantially all of its entire business.
          Section 7.10 Binding Nature; Third-Party Beneficiaries. This Agreement
shall be binding upon and inure solely to the benefit of the parties hereto and
their respective successors (whether by operation of law or otherwise) and
permitted assigns. Except as expressly provided herein, none of the provisions
of this Agreement shall be for the benefit of or enforceable by any third party,
including any creditor of either party or any of their Affiliates. Except as
expressly provided herein, no such third party shall obtain any right under any
provision of this Agreement or shall by reasons of any such provision make any
Claim in respect of any Liability (or otherwise) against either party hereto.
          Section 7.11 Severability. This Agreement shall be deemed severable;
the invalidity or unenforceability of any term or provision of this Agreement
shall not affect the validity or enforceability of this Agreement or of any
other term hereof, which shall remain in full force and effect, for so long as
the economic or legal substance of the transactions contemplated by this
Agreement is not affected in any manner materially adverse to any party. If it
is ever held that any restriction hereunder is too broad to permit enforcement
of such restriction to its fullest extent, each party agrees that such
restriction may be enforced to the maximum extent permitted by law, and each
party hereby consents and agrees that such scope may be judicially modified
accordingly in any proceeding brought to enforce such restriction.
          Section 7.12 No Right of Setoff. Neither party hereto nor any
Affiliate thereof may deduct from, set off, holdback or otherwise reduce in any
manner whatsoever any amount owed to it hereunder or pursuant to any Related
Agreement against any amounts owed hereunder

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of pursuant to any Related Agreement by such Persons to the other party hereto
or any of such other party’s Affiliates.
          Section 7.13 Currency. All monetary amounts mentioned or referred to
herein are in United States dollars unless otherwise indicated.
          Section 7.14 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any provision of this Agreement
was not performed in accordance with the terms hereof and that the parties shall
be entitled to specific performance of the terms hereof, in addition to any
other remedy at law or equity.
          Section 7.15 Construction.
               (a) For the purposes hereof, (i) words in the singular shall be
held to include the plural and vice versa and words of one gender shall be held
to include the other genders as the context requires, (ii) the words “hereof,”
“herein,” and “herewith” and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole (including the
Schedules hereto) and not to any particular provision of this Agreement, and
article, section, paragraph, exhibit and schedule references are to the
articles, sections, paragraphs, and exhibits and schedules of this Agreement
unless otherwise specified, (iii) the words “including” and words of similar
import when used in this Agreement shall mean “including, without limitation”
unless otherwise specified, (iv) the word “or” shall not be exclusive, (v) Buyer
and Seller will be referred to herein individually as a “party” and collectively
as “parties” (except where the context otherwise requires), and (vi) the phrase
“transactions contemplated by this Agreement” or “transactions contemplated
herein” shall include the transactions contemplated by the Schedules to this
Agreement.
               (b) The parties have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provisions of this
Agreement.
               (c) Any reference to any federal, state, local or non-U.S.
statute or law shall be deemed also to refer to all rules and regulations
promulgated thereunder, unless the context otherwise requires.
               (d) All references to dollars shall be to U.S. dollars.
          Section 7.16 Confidentiality. (a) Except as provided below, all data
and information disclosed between Buyer and Seller pursuant to this Agreement,
including information relating to or received from third parties, or to which
Buyer or Seller otherwise have access pursuant to this Agreement, is deemed
confidential (“Confidential Information”). A party receiving Confidential
Information (the “Receiving Party”) will not use such information for any
purpose other than for which it was disclosed and, except as otherwise permitted
by this Agreement, shall not disclose to third parties any Confidential
Information for a period of five (5) years from the termination or expiration of
this Agreement. The Receiving Party shall view, access and use only such
Confidential Information of the disclosing party as is necessary to

12

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provide or receive Services hereunder, as applicable, and shall not attempt to
view, access or use any other Confidential Information of the disclosing party.
Notwithstanding the foregoing, the Receiving Party’s obligation hereunder shall
not apply to information that:
               (i) is already in the Receiving Party’s possession at the time of
disclosure thereof;
               (ii) is or subsequently becomes part of the public domain through
no action of the Receiving Party; or
               (iii) is subsequently received by the Receiving Party from a
third party which has no obligation of confidentiality to the party disclosing
the Confidential Information.
               (b) Notwithstanding Section 7.16(a), Confidential Information may
be disclosed by the Receiving Party:
               (i) to the Receiving Party’s affiliates, directors, officers,
employees, agents (including, in the case of the Service Provider, any third
parties engaged to provide the Services), auditors, consultants and financial
advisers (collectively, “Agents”); provided that the Receiving Party ensures
that such Agents comply with this Section 17; and
               (ii) as required by Applicable Law; provided that, if permitted
by law, written notice of such requirement shall be given promptly to the other
party so that it may take reasonable actions to avoid and minimize the extent of
such disclosure, and the Receiving Party shall cooperate with the other party as
reasonably requested by the other party in connection with such actions.
               (c) If, at any time, any party determines that another party has
disclosed, or sought to disclose, Confidential Information in violation of this
Agreement, that any unauthorized personnel of another party has accessed
Confidential Information, or that any other party or any of its personnel has
engaged in activities that may lead or leads to the unauthorized access to, use
of, or disclosure of such party’s Confidential Information, such party shall
immediately terminate any such personnel’s access to the Confidential
Information and immediately notify such other party. In addition, any party
shall have the right to deny personnel of any other party access to such party’s
Confidential Information upon notice to such other party in the event that such
party reasonably believes that such personnel pose a security concern. Each
party will cooperate with the other parties in investigating any apparent
unauthorized access to or use of such party’s Confidential Information.

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     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.

            CMS ENTERPRISES COMPANY
      By:           Name:           Title:           ABU DHABI NATIONAL ENERGY
COMPANY PJSC
      By:           Name:   Peter Barker Homek        Title:   Chief Executive
Officer     

 

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SCHEDULE A
SERVICES

                  DURATION OF             SERVICES             FOLLOWING  
SERVICE   CONTACT SERVICE DESCRIPTION   CLOSING DATE   CHARGE   PERSON
1. Accounts Management and support in relation to the Projects (including in
relation to US GAAP). The following CMS employees who have been offered
employment with TAQA and have accepted such offers will remain on the CMS
payroll post closing and will continue to perform work for CMS until such time
as CMS has completed certain accounting functions with regard to the businesses
being acquired by TAQA: Michael F Bradford, Gopal S Gopalakrishnan, Kamlesh S
Naik, Anthony C Nemorin, Abdelilah Nhaila, and Raymond A Whitton. Following
completion of which, these individuals will become employees of TAQA. Such
employees will also perform transitional accounting services, including
assisting in establishing new accounting systems for TAQA, during the period
covered by this TSA.
  3 Months   No charge for the first 3 months post Closing Date. Thereafter
charges are to be agreed upon by Seller and Buyer.   Michael Sniegowski
 
           
2. General Human Resources Services including payroll services
  3 Months   No charge for the first 3 months post Closing Date. Thereafter
charges are to be agreed upon by Seller and Buyer.   Michael Sniegowski

 

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                  DURATION OF             SERVICES             FOLLOWING  
SERVICE   CONTACT SERVICE DESCRIPTION   CLOSING DATE   CHARGE   PERSON
3. Information Technology Services including access (and remote access where
appropriate) to the following :

- office systems; continued use of laptops, desktops, printers, PDAs (all at the
level of service as of the Closing Date);
- network, in the office as well as secured remote access (VPN);
- help desk services;
- software maintenance and support;
- hardware maintenance and support;
- network maintenance and support;
- operations support;
- e-mail services: exchange of e-mails forwarding incoming emails to TAQA email
accounts
- internet access;
- communication: mobile telephony, cellular services (all at the level of
service as of the Closing Date);
- VPN connectivity to plants as well as Internet and e-mail services where
currently provided
  3 Months   No charge for the first 3 months post Closing Date. Thereafter
charges are to be agreed upon by Seller and Buyer.   Michael Sniegowski
 
           
4. Provision of office space in Jackson, MI for former CMS employees (hired by
TAQA post-closing and currently located in the Jackson, MI office (including all
office facilities and utilities)
  3 Months   No charge for the first 3 months post Closing Date. Thereafter
charges are to be agreed upon by Seller and Buyer.   Michael Sniegowski

 

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                  DURATION OF             SERVICES             FOLLOWING  
SERVICE   CONTACT SERVICE DESCRIPTION   CLOSING DATE   CHARGE   PERSON
5. If requested directly by TAQA, provision of CMS labor (but not any third
party costs) relating to the following services currently provided by Seller to
the businesses being purchased by Buyer:
  3 Months   No charge for the first 3 months post Closing Date. Thereafter
charges are to be agreed upon by Seller and Buyer.   Michael Sniegowski
 
           
a. Support of Rapid Response Plans
           
b. Technical support necessary to support obligations under Technical Services
Agreements
           
 
           
6. Michael Weber and Fredrick Phelps will remain employees of CMS until June 1,
2007, but will perform transitional duties for Taqa during such time.
  June 1, 2007   No charge for the first 3 months post Closing Date. Thereafter
charges are to be agreed upon by Seller and Buyer.   Michael Sniegowski

 

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EXHIBIT D
ABU DHABI NATIONAL ENERGY COMPANY PJSC (“TAQA”)
REFINANCING OF CGIC DEBT

     
Borrower:
  CMS Generation Investment Company IV (“CGIC”)
 
   
Guarantor:
  CMS Energy Corporation
 
   
Lender:
  TAQA or TAQA affiliate
 
   
Purpose:
  To refinance all indebtedness of CGIC outstanding under the Credit Agreement,
dated as of December 15, 2005, among CGIC and the lenders from time to time
party thereto (as amended or supplemented from time to time, the “CGIC Credit
Agreement”).
 
   
Amount:
  CGIC’s debt’s principal outstanding (such amount to be adjusted to be equal to
the aggregate principal amount of debt outstanding under the CGIC Credit
Agreement at the time of the refinancing, plus any accrued but unpaid interest,
fixed interest-rate breakage, prepayment premiums, breakage costs and other
costs of prepayment of such debt:
 
   
 
 
(1)  US$53,588,000 (such amount to be adjusted to be equal to the aggregate
principal amount of US$ term debt at the time of the refinancing, plus accrued
interest and any fixed interest-rate breakage and other prepayment costs) and
 
   
 
 
(2)  €40,0007000 (such amount to be adjusted to be equal to the aggregate
principal amount of € term debt at the time of the refinancing, plus accrued
interest and any fixed interest-rate breakage and other prepayment costs).
 
   
Currency:
  The refinanced loan will have two tranches — a USD Tranche and a Euro Tranche
to correspond to the currency of the CGIC loans to be prepaid.
 
   
Tenor:
  3 years from the date of the final disbursement.
 
   
Applicable Margin:
  As set forth in Amendment No. 1, dated August 3 1, 2006, to the CGIC Credit
Agreement.
 
   
Interest Rate Benchmark:
  3 or 6 months Eurodollar Rate or Euro Rate, as applicable.
 
   
Availability Period:
  From the date of when all conditions precedent have been satisfied or waived
to the date of the termination of the Sale and Purchase Agreement (“SPA”)
between TAQA and CMS Enterprises.
 
   
Financial Close and Timing:
  Refinancing agreements to be agreed as soon as practically possible to allow
to complete all of the following within the time periods specified:  
 
 
(i)  conditions precedent being satisfied by no later than the day immediately
preceding the Prepayment Notice Date (as defined below) on the basis that TAQA
shall have an unconditional obligation to lend following its notification to
CGIC that such

 

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       conditions precedent have been satisfied;
 
   
 
 
(ii)  prefunding by TAQA into escrow of the full prepayment amount and
confirmation of receipt of the escrow funds by no later than the day immediately
preceding the Prepayment Notice Date (as defined below) or such other date that
is mutually agreed upon by the parties;
 
   
 
 
(iii) submission by CGIC of the prepayment notice by no later than 4 Business
Days (as defined in the CGIC Credit Agreement) prior to the date of prepayment
of the CGIC Debt outstanding under the CGIC Credit Agreement (such date, the
“Prepayment Notice Date”); and
 
   
 
 
(iv) financial close occurring sufficiently in advance to permit the completion
of all actions necessary or required in order for JLEC to deliver the repayment
notice with respect to the JLEC debt outstanding under the JLEC financing
agreements by no later than April 13,2007 (or, if such date is not a Business
Day as defined in the JLEC financing agreements, on the preceding Business Day
in accordance with the JLEC financing agreements).
 
   
Repayment Schedule:
  Bullet payment at maturity.
 
   
Final Maturity Date:
  3 years after Financial Close.
 
   
Security:
  Perfected security interest in the Account Collateral (as such term is defined
in the CGIC Credit Agreement) as a condition subsequent following the repayment
of the debt under the CGIC Credit Agreement.
 
   
Prepayments:
  Mandatory: within 120 days from the termination of the SPA. Optional: at any
time without premium or penalty but subject to payment of accrued interest.
 
   
Covenants:
  Substantially the same as the existing facility, except that terms and
provisions relating to the guarantor will not be required, i.e, covenants at
CGIC level and below.

Cash sweep from the earlier of (i) December 15, 2008 and (ii) the termination of
the SPA
 
   
Events of Default:
  Substantially the same as the existing facility, except that events of default
relating to the guarantor will not be required.
 
   
Terms and conditions:
  To be substantially equivalent to the terms and conditions applying to the
existing senior debt. However, terms and provisions relating to the guarantor
and its credit will not be required.

 

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EXHIBIT E

EXECUTION VERSION
CLOSING CERTIFICATE
OF
CMS ENTERPRISES COMPANY
          This certificate is being delivered pursuant to Section 6.2(c) of the
Agreement of Purchase and Sale (the “Agreement”), dated as of February 3, 2007,
by and between CMS Enterprises Company, a Michigan corporation (“Seller”) and
Abu Dhabi National Energy Company PJSC, an United Arab Emirates public joint
stock company (“Buyer”). Capitalized terms used and not otherwise defined herein
shall have the meanings ascribed to such terms in the Agreement.
          The undersigned Thomas J. Webb, in his capacity as Executive Vice
President and Chief Financial Officer, and not individually, hereby certifies as
follows:
     1. The representations and warranties of Seller in the Agreement (without
taking into account any materiality or Material Adverse Effect qualification
therein) are true and correct as of the date hereof with the same effect as
though such representations and warranties had been made as of the date hereof
(except for representations and warranties that speak as of a specific date or
time, which are true and correct as of such date or time), except (i) for
changes specifically contemplated or permitted by the Agreement and (ii) where
such failure to be so true and correct, either individually or in the aggregate,
would not have a Material Adverse Effect as of the date hereof;
     2. Seller has performed in all material respects all of its obligations
required to be performed by it under the Agreement at or prior to the date
hereof; and
     3. As of the date hereof, there has not occurred any event or circumstance,
which individually or in the aggregate, has resulted in a Material Adverse
Effect.
[Signature Page Follows]

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     IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed as of this 2 day of May, 2007.

            CMS ENTERPRISES COMPANY
      By:   Thomas J. Webb         Name:   Thomas J. Webb        Title:  
Executive Vice President and Chief Financial Officer     

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EXHIBIT F

EXECUTION VERSION
CLOSING CERTIFICATE
OF
ABU DHABI NATIONAL ENERGY COMPANY PJSC
          This certificate is being delivered pursuant to Section 6.3(e) of the
Agreement of Purchase and Sale (the “Agreement”), dated as of February 3, 2007,
by and between CMS Enterprises Company, a Michigan corporation (“Seller”) and
Abu Dhabi National Energy Company PJSC, an United Arab Emirates public joint
stock company (“Buyer”). Capitalized terms used and not otherwise defined herein
shall have the meanings ascribed to such terms in the Agreement.
          The undersigned Peter Barker Homek, in his capacity as Chief Executive
Officer, and not individually, hereby certifies as follows:
     1. The representations and warranties of Buyer in the Agreement (without
taking into account any materiality or Material Adverse Effect qualification
therein) are true and correct as of the date hereof with the same effect as
though such representations and warranties had been made as of the date hereof
(except for representations and warranties that speak as of a specific date or
time, which are true and correct as of such date or time), except (i) for
changes specifically contemplated or permitted by the Agreement and (ii) where
such failure to be so true and correct, either individually or in the aggregate,
would not have a Material Adverse Effect as of the date hereof;
     2. Buyer has performed in all material respects all of its obligations
required to be performed by it under the Agreement at or prior to the date
hereof;
     3. Buyer has complied in all material respects with its obligations
pursuant to Section 5.4 of the Agreement;
     4. The written consents set forth in Section 6.3(e) of the Seller
Disclosure Letter have been obtained.
[Signature Page Follows]

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EXHIBIT F
EXECUTION VERSION
     IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed as of this 2 day of May, 2007.

            ABU DHABI NATIONAL ENERGY COMPANY PJSC
      By:   /s/ Peter Barker Homek         Name:   Peter Barker Homek       
Title: Chief Executive Officer     

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Exhibit G to the Agreement of Purchase and Sale, dated February 3, 2007, by and
between CMS Energy Corporation and Abu Dhabi National Energy Company PJSC (TAQA)
(“TAQA”).
Exhibit A to the Letter Agreement, dated February 3, 2007 (the “Tri-party
Agreement”), by and among CMS Energy Corporation, ABB Asea Brown Boveri Limited
and TAQA.
ABU DHABI NATIONAL ENERGY COMPANY PJSC (“TAQA”)
REFINANCING OF JORF LASFAR PROJECT

     
Borrower:
  Jorf Lasfar Energy Company S.C.A. (“JLEC”)
 
   
Lender:
  TAQA or TAQA affiliate.1
 
   
Purpose:
  To refinance JLEC’s senior debt subject to the Common Agreement, dated as of
September 4, 1997 among JLEC and the lenders and relevant agents party thereto
from time to time (as amended or supplemented, the “Common Agreement”).
 
   
Term Loan Facilities:
 
1)     Tranche A: US$122.5 million (such amount to be adjusted to be equal to
the aggregate principal amount of JLEC’s U.S. Exim-Guaranteed Loans (as defined
in the Common Agreement) outstanding at the time of the refinancing, plus any
accrued but unpaid interest, fixed interest-rate breakage, swap breakage,
prepayment premiums, breakage costs and other costs of prepayment under JLEC’s
U.S. Exim-Guaranteed Loans).
 
   
 
 
2)     Tranche B: US$31.5 million (such amount to be adjusted to be equal to the
aggregate principal amount of JLEC’s OPIC Loans (as defined in the Common
Agreement) evidenced by installment A note and outstanding at the time of the
refinancing, plus any accrued but unpaid interest, fixed interest-rate breakage,
swap breakage, prepayment premiums, breakage costs and other costs of prepayment
under JLEC’s OPIC Loans evidenced by installment A).
 
   
 
 
3)     Tranche C: US$6.9 million (such amount to be adjusted to be equal to the
aggregate principal amount of JLEC’s OPIC Loans (as defined in the Common
Agreement) evidenced by installment B note and outstanding at the time of the
refinancing, plus any accrued but unpaid interest, fixed interest-rate breakage,
swap breakage, prepayment premiums, breakage costs and other costs of prepayment
under JLEC’s OPIC Loans evidenced by installment B note).
 
   
 
 
4)     Tranche D: €121.2 million (such amount to be adjusted to be equal to the
aggregate principal amount of JLEC’s SACE Guaranteed Loans (as defined in the
Common Agreement) outstanding at the time of the refinancing, plus any accrued
but unpaid interest, fixed interest-rate breakage,

 

1   Nature of TAQA affiliate to be discussed to ensure no negative tax
implications.

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     swap breakage, prepayment premiums, breakage costs and other costs of
prepayment under JLEC’s SACE Guaranteed Loans).
 
   
 
 
5)     Tranche E: €15.6 million (such amount to be adjusted to be equal to the
aggregate principal amount of JLEC’s ERG-Guaranteed Loans (as defined in the
Common Agreement) outstanding at the time of the refinancing, plus any accrued
but unpaid interest, fixed interest-rate breakage, swap breakage, prepayment
premiums, breakage costs and other costs of prepayment under JLEC’s
ERG-Guaranteed Loans).
 
   
 
 
6)     Tranche F: €83.4 million (such amount to be adjusted to be equal to the
aggregate principal amount of JLEC’s World Bank-Guaranteed Loans (as defined in
the Common Agreement) outstanding at the time of the refinancing, plus any
accrued but unpaid interest, fixed interest-rate breakage, swap breakage,
prepayment premiums, breakage costs and other costs of prepayment under JLEC’s
World Bank-Guaranteed Loans).
 
   
 
  Facilities to be structured to ensure that JLEC’s tax position will not be
changed as a result of the refinancing, including that no withholding tax should
apply on interest payments made on the loans.
 
   
 
  The loan tenor will be 11 (eleven) years from the date of TAQA’s final
disbursement to JLEC and may additionally include TAQA lending through an
affiliate resident in Sweden. JLEC shall not be liable for any withholding or
similar tax associated with payments under the TAQA refinancing loan save to the
extent that assessments would also have been made in respect of the existing
financing.
 
   
 
  By mutual agreement of JLEC and TAQA, for administrative simplification
Tranches A, B, and C may be consolidated into one U.S. Dollar-denominated loan,
and Tranches D, E, and F may be consolidated into one Euro-denominated loan.
 
   
Tenor and Repayment Schedule:
  The loan tenor will be extended to a final maturity of 11 (eleven) years from
the date of TAQA’s final disbursement to JLEC.

Debt service for each Tranche A to F will be calculated based on mortgage style
equal quarterly debt service payments with final maturity of 11 years (as
specified above) and interest rates specified below for the respective tranches.
 
   
Interest:
  The following fixed all-in interest rate will be applicable for each of the
tranches:
 
   
 
 
Tranche A: 7.200% per annum, payable quarterly on each repayment date
Tranche B: 6.480% per annum, payable quarterly on each repayment date
Tranche C: 6.170% per annum, payable quarterly on each repayment date
Tranche D: 5.730% per annum, payable quarterly on each repayment date
Tranche E: 8.596% per annum, payable quarterly on each repayment date
Tranche F: 8.287% per annum, payable quarterly on each repayment date
 
   
 
  In the event JLEC and TAQA agree to consolidate the loans as provided above in
“Term Loan Facilities”: (i) the applicable interest rate for the U.S.
Dollar-denominated loan shall be the weighted average of the interest rates
specified above for Tranches A, B, and C, and (ii) the applicable interest rate
for the Euro-denominated loan shall be the weighted average of the interest
rates specified above for Tranches D, E, and F.

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Fees
  No upfront or commitment fees.
 
   
Terms and conditions:
  To be substantially equivalent to the common terms and conditions applying to
JLEC’s existing senior debt, as relevant, including, without limitation, in
respect of financial covenants and project accounts.

However, terms specific to the requirements of any particular lender, financial
participant, guarantor, or export credit agency will not be required, including
in relation to national ownership or participation requirements.
 
   
Security:
  To follow the security interests granted in respect of JLEC’s existing senior
debt financing, with relevant security documents agreed and signed but not
effective and security not perfected until the existing security has been
released.
 
   
Due diligence:
  TAQA has already substantially completed its due diligence on the Jorf Lasfar
Project in connection with its potential indirect purchase of CMS’ 50% interest
in JLEC. Accordingly, only limited due diligence by TAQA as a lender to JLEC
will be required in relation to matters such as withholding tax and the tax
effects to JLEC of providing the finance through a related party loan.
 
   
Timing:
  If applicable pursuant to the Tri-Party Agreement, refinancing to be effected
on May 15, 2007 (or, if such day is not a Business Day as defined in the Common
Agreement, on the preceding Business Day in accordance with the Common
Agreement) (such date, the “Refinancing Date”).
 
   
 
  Refinancing agreements to be agreed as soon as practically possible to allow
to complete all of the following within the time periods specified:
 
   
 
 
(i)   conditions precedent being satisfied by no later than the day preceding
the Prepayment Notice Date (as defined below) on the basis that TAQA shall have
an unconditional obligation to lend following its notification to JLEC that such
conditions precedent have been satisfied;
 
   
 
 
(ii)  prefunding by TAQA into escrow of the full prepayment amount and
confirmation of receipt of the escrow funds by no later than the day preceding
the Prepayment Notice Date (as defined below) or such other date that is
mutually agreed upon by the parties;
 
   
 
 
(iii) submission by JLEC of the prepayment notice by no later than April 13,
2007 (or, if such day is not a Business Day as defined in the Common Agreement,
on the preceding Business Day in accordance with the Common Agreement) (such
date, the “Prepayment Notice Date”);
 
   
 
 
(iv) prefunding of the prepayment of the OPIC loan from the amounts funded under
(ii) not less than 20 (twenty) days prior to the Refinancing Date; and
 
   
 
 
(v)   financial close occurring on the Refinancing Date.
 
   
Optional Prepayment:
  JLEC will be permitted to prepay the refinancing loan from TAQA at any time
without any provision for breakage costs, prepayment premium, penalties, or
other fees or cost for early repayments/prepayments.

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Mandatory Prepayment
  In addition to the mandatory prepayment obligations included in the existing
financing agreements, if (i) the JLEC refinancing achieves final financial
close, (ii) the Sale and Purchase Agreement (“SPA”) between TAQA and CMS
Enterprises is subsequently terminated, and (iii) JLEC has not refinanced the
refinancing debt provided by TAQA to JLEC within 12 (twelve) months from the
termination of the SPA, then 100% of JLEC’s otherwise distributable cash shall
be applied toward the accelerated repayment of the refinancing debt provided by
TAQA until repaid in full.
 
   
 
  Upon such termination of the SPA, (i) if TAQA or any of its affiliates hold
directly or indirectly any ownership interest in JLEC, JLEC shall use its
reasonable best efforts to refinance the debt provided by TAQA to JLEC within 24
(twenty four) months from the termination of the SPA, or (ii) if TAQA or any of
its affiliates do not hold directly or indirectly any ownership interest in
JLEC, JLEC shall refinance the debt provided by TAQA to JLEC within 24 (twenty
four) months from the termination of the SPA.
 
   
Mutual Agreement
  The implementation of the JLEC refinancing contemplated by the terms outlined
above is subject in all respects to agreement on definitive terms and
documentation that are mutually acceptable to TAQA, CMS, ABB, and JLEC.

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EXHIBIT H

EXECUTION VERSION
SELLER ACCESS AND SUPPORT AGREEMENT
     SELLER ACCESS AND SUPPORT AGREEMENT, dated as of May 2, 2007 (this
“Agreement”), by and between CMS Enterprises Company (“Seller”), a Michigan
corporation, and Abu Dhabi National Energy Company PJSC, a United Arab Emirates
public joint stock company (“Acquiror”).
     WHEREAS, pursuant to an Agreement of Purchase and Sale, dated as of
February 3, 2007, by and between Seller and Acquiror (“Purchase Agreement”),
Seller has agreed to sell to Acquiror, and Acquiror has agreed to purchase from
Seller, all of the issued and outstanding limited liability interests of CMS
Generation LLC, a Michigan limited liability company (together with its
Subsidiaries, “Generation”);
     WHEREAS, Generation, through its Subsidiaries, indirectly holds ownership
interests in the following energy projects: Jorf, Jubail, Neyveli, Shuweihat,
Takoradi and Taweelah (collectively, the “Projects”);
     WHEREAS, pursuant to the Purchase Agreement, Seller has agreed to indemnify
Buyer for certain matters (the “Indemnification Matters”) pursuant to
Section 8.2(a)(iv) thereof and to pursue certain insurance claims pursuant to
Section 5.9 thereof (together with the Indemnification Matters, the
“Proceedings”);
     WHEREAS, in the normal course of investigating, prosecuting and/or
defending the Proceedings, Seller and its counsel have, and will continue to
have, a need (i) to refer to, and to use as evidence, certain books, records and
other data, including electronic data maintained in computer files, relating to
Generation or the Projects and (ii) for the support and cooperation of present
or former employees of Generation, or the Projects in the event that such
persons’ assistance or participation is needed to aid in the defense or
settlement of the Proceedings;
     WHEREAS, Seller will retain discretion and authority as described in this
Agreement to manage all litigation, activities and negotiations associated with
the Proceedings; and
     WHEREAS, pursuant to the Purchase Agreement, Seller and Acquiror have
agreed to enter into this Agreement.
     NOW, THEREFORE, in consideration of the premises and covenants contained
herein and other good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged, Seller and Acquiror, intending to be bound
legally, agree as follows:
     Section 1. Definitions. For purposes hereof, capitalized terms used and not
otherwise defined herein shall have the respective meanings assigned to such
terms in the Purchase Agreement, unless the context hereof shall otherwise
require, and the same rules of construction as set forth under Section 1.2 of
the Purchase Agreement shall apply herein; provided that the following terms
shall have the following respective meanings:

 

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     “Acquiror Representatives” shall mean the respective directors, officers,
employees, agents, counsel, consultants, representatives, accountants and
auditors of Acquiror, Generation and the Projects.
     “Business” shall mean the business conducted by Generation and the Projects
after giving effect to the transactions contemplated by the Purchase Agreement.
     “Claims Data” shall mean all material and relevant current and historical
sales records, customer files, contract records, accounting records,
intercompany and intracompany communications, communications with any
Governmental Authority, requests and responses to requests, construction,
planning, engineering and operational documents, market studies or evaluations,
and all other data (including, without limitation, electronic data maintained in
computer files) of the Business relating to or associated with the Proceedings.
     “Transferred Employees” shall mean all employees of Generation or the
Projects employed on or following the Closing Date, including employees not
actively at work by reason of layoff, sick leave, absence, vacation, short term
disability, or other approved leave of absence and any employee of Seller or its
Affiliates prior to Closing who is employed by Buyer on or following Closing.
     “Seller’s Representatives” shall mean Seller’s respective directors,
officers, employees, agents, counsel, consultants, representatives, accountants
and auditors.
     Section 2. Control of Settlements and Disputes; Further Cooperation.
          (a) From and after the Closing Date, Seller shall retain complete
control over and shall have the sole and absolute right to conduct and control
all negotiations and activities with respect to the Proceedings and all other
aspects of investigation, prosecution and/or defense of the Proceedings. Such
control shall include without limitation (i) preparing and filing all pleadings,
motions and other documents filed with or provided to any court or other
tribunal, (ii) preparing and sending or delivering all correspondence or other
documents provided to any party in connection with the Proceedings,
(iii) preparing, responding to and serving all discovery and discovery responses
(and related matters), (iv) negotiating and, subject to Section 2(b) hereof,
entering into any settlement or compromise agreement (including on behalf of
Acquiror, Generation or the Projects) with any party in connection with the
Proceedings and making all decisions with respect to the defense of the
Proceedings, (v) selecting legal counsel, experts, accountants and other
advisors or representatives to represent Acquiror, Generation or the Projects
and/or to assist Seller with respect to the Proceedings and (vi) taking any and
all such other actions as may be necessary, appropriate or deemed helpful by
Seller in its sole and absolute discretion in order to effectuate the foregoing.
Acquiror will, and will require Generation and the Projects to, notify Seller
promptly of all matters relating to the Proceedings and will not, except with
the prior written consent of Seller, make any payment of, or settle or offer to
settle, consent to any compromise, make any admissions, file any pleadings,
motions or documents, send any correspondence or respond to or serve any
discovery requests with respect to the Proceedings.

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          (b) To the extent that any settlement or compromise agreement entered
into with respect to the Proceedings would require Acquiror, Generation or the
Projects to provide any consideration, monetary or non-monetary, for which the
indemnity contained in Section 8.2 of the Purchase Agreement does not apply (or
only applies in part), then such settlement or compromise shall require the
approval of Acquiror, which shall not be unreasonably withheld.
          (c) Subject to paragraph (b) above, Acquiror, Generation or the
Projects shall cause appropriate officers, duly authorized to act on behalf of
Acquiror, Generation or the Projects, to execute (at Seller’s cost) any
documents and instruments necessary or appropriate in connection with any
investigation, settlement or compromise relating to, or the defense of, the
Proceedings, including without limitation any settlement agreement and general
release.
     Section 3. Acquiror’s Obligation to Maintain Records. Acquiror shall
maintain and preserve in a manner and at a level consistent in all material
respects with the manner and level applied immediately prior to the Closing
Date, unless otherwise directed by a court order or governmental authority, and
shall cause the Acquiror Representatives to, maintain and preserve all Claims
Data until this Agreement is terminated in accordance with Section 9 hereof or
until such time as Seller shall notify Acquiror in writing that it is no longer
necessary to maintain such Claims Data. Acquiror shall not, and shall cause the
Acquiror Representatives not to, destroy or dispose of the Claims Data, unless
consented to in writing by Seller. Acquiror may move the Claims Data from its
location(s) as of the Closing Date, provided that it notifies the Seller in
writing of such new location.
     Section 4. Access to Claims Data. In connection with the defense,
prosecution or settlement of the Proceedings, Acquiror shall, and shall cause
the Acquiror Representatives to, reasonably cooperate with and give Seller or
the Seller Representatives access to all Claims Data during regular business
hours, and upon five (5) days prior written notice, at Acquiror’s principal
place of business or at any location where such Claims Data is located, and
Seller shall have the right, at its own expense, to make copies of such Claims
Data. Acquiror shall make available to Seller or the Seller Representatives,
upon written request and at Seller’s expense, Acquiror’s personnel to provide
reasonable assistance (provided such assistance shall not materially affect the
normal operations of Acquiror or the Business) to Seller or the Seller
Representatives in locating and obtaining any Claims Data maintained by
Acquiror.
     Section 5. Cooperation in Litigation. Acquiror shall (a) make available to
Seller or the Seller Representatives (provided such assistance shall not
materially affect the normal operations of Acquiror or the Business), upon five
(5) days written request, any relevant employee of Acquiror from time to time
necessary to authenticate the Claims Data, or any Transferred Employee who
continues to be employed by Acquiror whose assistance or participation is
reasonably required by Seller or the Seller Representatives in anticipation of,
or in the investigation of or preparation for the defense or settlement of the
Proceeding; provided that no employee or agent of the Seller or one of its
Affiliates can reasonably provide the assistance requested from the employee of
Acquiror or the Transferred Employee, and (b) provide reasonable assistance to
Seller in locating any Transferred Employee who is no longer employed by
Acquiror whose assistance or participation is reasonably required by Seller or
the Seller Representatives in anticipation of, or in the investigation of or
preparation for the defense or

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settlement of the Proceedings. Seller shall pay all reasonable out of pocket
costs and expenses arising from such assistance or participation by such
employee of Acquiror or Transferred Employees. Seller shall use their reasonable
best efforts to minimize the interference with such employee of Acquiror or
Transferred Employee’s duties caused by such assistance or participation.
     Section 6. Insurance. Acquiror hereby assigns, transfers and conveys to
Seller all rights, benefits and causes in action under all insurance policies
(the “Insurance Policies”) maintained by or for the benefit of Generation or any
Project to the extent such Insurance Policies obligate (or potentially obligate)
the insurers to defend or indemnify any insureds therein in connection with,
arising from or related to the Proceedings. Acquiror agrees that Seller may
pursue any claims and make any demands to any insurer under the Insurance
Policies in the name of Acquiror to receive and enjoy the full benefits of this
provision to the fullest extent permitted by law. Acquiror further agrees to
immediately deliver to Seller all proceeds, payments or benefits received from
any insurer under the Insurance Policies to the extent such proceeds, payments
or benefits are made in connection with, arising from or relating to the
Proceedings.
     Section 7. Indemnification. In the event Acquiror fails to perform or
comply with any of its covenants and obligations described in hereunder, Seller
shall promptly provide Acquiror with written notice of the assertion of such
non-performance or non-compliance, such notice shall be given in accordance with
Section 9.6 of the Purchase Agreement and shall specify, in reasonable detail,
the nature of such breach. Subject to Section 8 of this Agreement, the
provisions of Article VIII of the Purchase Agreement shall apply to the
indemnification for breach of this Agreement by the Acquiror, and by this
reference such provisions of Article VIII of the Purchase Agreement are
incorporated herein as if set forth in full herein. The obligation of Seller to
indemnify the Buyer Indemnified Parties pursuant to Section 8.2 of the Purchase
Agreement shall not apply to the extent such Damages are attributable to
Acquiror’s failure to comply with this Agreement. The remedies available to
Seller under this Section 7 are in addition to those available to it under
Section 8.
     Section 8. Specific Performance. The parties hereto agree that irreparable
damage will occur if any of Acquiror’s covenants under this Agreement is not
performed in accordance with its specific terms or otherwise is breached, and
that Seller may not have an adequate remedy at law in respect of such
non-performance or breach. It is accordingly agreed that Seller shall be
entitled to an injunction or injunctions to prevent any non-performance or
breach of this Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having jurisdiction, in
addition to any other remedy to which they are entitled at law or in equity. In
addition, Acquiror agrees not to assert any defense against an action for
specific performance of Acquiror’s covenants under this Agreement.
     Section 9. Survival; Modification, Termination and Waiver. This Agreement
shall remain in full force and effect until the earlier of (a) the written
consent of the parties hereto to terminate this Agreement, or (b) 30 days after
termination of the Proceedings by a binding settlement or a final court order,
not subject to appeal or review. This Agreement may be amended, supplemented or
modified, and any provision hereof may be waived, only pursuant to a written
instrument making specific reference to this Agreement signed by the parties
hereto.

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No waiver of any of the provisions of this Agreement shall be deemed to or shall
constitute a waiver of any other provision hereof (whether or not similar). No
delay on the part of Seller in exercising any right, power or privilege
hereunder shall operate as a waiver thereof.
     Section 10. Notices. All notices and other communications under this
Agreement shall be in writing, shall refer to this Agreement, and shall
otherwise be given in accordance with Section 9.6 of the Purchase Agreement.
     Section 11. Governing Law. This Agreement, including all maters of
construction, validity and performance, shall be governed by and construed in
accordance with the law of the State of New York without regard to the
principles of conflicts of laws or any other law that would make the laws of any
other jurisdiction other than the State of New York applicable hereto.
     Section 12. Binding Effect; No Assignment. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns. No assignment of this Agreement or of any rights or
obligations hereunder may be made by any party (by operation of law or
otherwise) without the prior written consent of the other party hereto, which
consent may be withheld or granted by such party in its sole discretion,
provided that such consent may not be unreasonably withheld or delayed by Seller
if Acquiror complies with the provision of the last sentence of this Section 12.
Any attempted assignment without required consents shall be void. In the event
Acquiror proposes to sell all or substantially all of the assets of the Business
at any time subsequent to the date hereof, Acquiror shall provide Seller notice
of such sale as soon as reasonably practicable, whereupon Seller shall have the
right, at its option and expense, upon written notice to Acquiror, to make
copies of any Claims Data (whether prior to or following such sale) for a
reasonable period of time following receipt of such notice. Acquiror will cause
such purchaser to assume Acquiror’s obligations under this Agreement utilizing a
written instrument reasonably satisfactory to Seller.
     Section 13. Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable under any applicable present or future law,
and if the rights or obligations of either party under this Agreement will not
be materially and adversely affected thereby, (a) such provision shall be fully
severable, (b) this Agreement shall be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
(c) the remaining provisions of this Agreement shall remain in full force and
effect and shall not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom and (d) in lieu of such illegal, invalid
or unenforceable provision, there shall be added automatically as a part of this
Agreement, a legal, valid and enforceable provision as similar in terms to such
illegal, invalid or unenforceable provision as may be possible.
     Section 14. Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which, when executed, shall be deemed an original, and all
of which together shall constitute one and the same Agreement.
     Section 15. Entire Agreement. This Agreement, including the Purchase
Agreement, the Seller Disclosure Letter, Buyer Disclosure Letter, and Schedules
thereto, together with the other

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Related Agreements and the Confidentiality Agreement constitute the entire
agreement between the parties hereto with respect to the subject matter herein
and supersede all previous agreements, whether written or oral, relating to the
subject matter of this Agreement and all prior drafts of this Agreement, all of
which are merged into this Agreement. No prior drafts of this Agreement and no
words or phrases from any such prior drafts shall be admissible into evidence in
any action or suit involving this Agreement.
     Section 16. Headings. The headings used in this Agreement have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.
     Section 17. Consent to Jurisdiction; Exclusive Forum. All disputes arising
out of or relating to this Agreement or the breach, termination or validity
thereof or the parties’ performance hereunder shall be resolved as provided by
Section 9.7 of the Purchase Agreement.

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     IN WITNESS WHEREOF, the parties hereto have executed this Access and
Support Agreement as of the date and year first written above.

                  CMS ENTERPRISES COMPANY    
 
           
 
  By:        
 
  Name:  
 
Sharon McIlnay    
 
  Title:   Vice President and General Counsel    
 
                ABU DHABI NATIONAL ENERGY COMPANY PJSC    
 
           
 
  By:        
 
  Name:  
 
Peter Barker Homek    
 
  Title:   Chief Executive Officer    

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SELLER DISCLOSURE LETTER
Introduction
Reference is made to the Agreement of Purchase and Sale, dated as of February 3,
2007 (the “Agreement”) by and between CMS Enterprises Company, a corporation
organized under the laws of the State of Michigan (“Seller” or “CMS”) and Abu
Dhabi National Energy Company PJSC, a public joint stock company organized under
the laws of the United Arab Emirates (“Buyer”), Capitalized terms used, but not
defined herein, have the respective meanings given to such terms in the
Agreement.
This Seller Disclosure Letter (the “Seller Disclosure Letter”) sets forth
certain information or agreements intended to be treated as disclosed in the
Seller Disclosure Letter pursuant to the Agreement.
The contents of this Seller Disclosure Letter are qualified in their entirety by
reference to the specific provisions of the Agreement. This Seller Disclosure
Letter is not intended to constitute, and shall not be deemed to constitute,
representations and warranties of Seller except as. and to the extent provided
in the Agreement. In particular, although this Seller Disclosure Letter may
contain supplementary information not specifically required under the Agreement,
such supplementary information is provided as general information for the
parties to the Agreement and is not separately represented or warranted by
Seller herein or in the Agreement. Moreover, the inclusion of any item hereunder
shall not be deemed an admission by Seller that such item is, or may at anytime
be or have been, material to Seller, Generation or any of its Material
Subsidiaries or the transactions contemplated by the Agreement, or result in any
determination that any matter has a Material Adverse Effect, nor shall it be
deemed an admission of an obligation or liability to any third party.
Any matter set forth in the Seller Disclosure Letter shall be deemed disclosed
with respect to such other sections of the Agreement or the Seller Disclosure
Letter to which such disclosure on its face would reasonably pertain in light of
the form and substance of the disclosure made. The section and subsection
references set forth in this Disclosure Letter refer to sections or subsections
of the Agreement to which the disclosure set forth in this Seller Disclosure
Letter is intended to apply. The introductory language and headings in this
Seller Disclosure Letter are inserted for convenience of reference only and will
not create or be deemed to create a different standard for disclosure than the
language set forth in the Agreement.
The information set forth herein is confidential and is subject to the terms of
the Confidentiality Agreement, dated June 19, 2006, between Buyer and Seller.

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Section l.l(i) Knowledge of Seller
1. Brian S. Jackson, Executive Managing Director, Taweelah, was consulted with
respect to representations and warranties relating to Taweelah.
2. Rodak Iqbal, Site Manager, Jubaii, was consulted with respect to
representations and warranties relating to Jubaii.
3. The following individuals were consulted with respect to representations and
warranties relating to Jorf:
a) Larry De Witt, General Manager, Jorf; and
b) David O’Hanian, Executive Director Financial Advisory and Strategic Planning
Group of Seller.
4. Douglas Lalleur, Plant Manager, Shuweihat, was consulted with respect to
representations and warranties relating to Shuweihat.
5. The following individuals were consulted with respect to representations and
warranties relating to Ncyveli:
a) CK Lakshminarayanan, President & Chief Executive Officer, Neyveli; and
b) Rahu! Mittal, Director Financial Advisory and Strategic Planning Group
ofSeiler.
6. The following individuals were consulted with respect to representations and
warranties relating to Takoradi:
a) R. Balachandar, General Manager, Takoradi;
b) Malcolm Wrigley, Director International Asset Management of Generation; and
c) Erik Granskog, Senior Director Financial Advisory and Strategic Planning
Group of Seller.
7. Robert Frounfclker, Executive Director, Risk Management of Energy, was
consulted with respect to representations and warranties relating to insurance
matters.
8. Sue Koseck, Director of Human Resources of Seller, was consulted with respect
to representations and warranties relating to human resources,
9. James Saunders, Project Leader of Generation, was consulted with respect to
representations and warranties relating to intellectual property matters.
10. Mike Weber, Director of Environmental Affairs of Generation, was consulted
with respect to representations and warranties relating to environmental
matters.
11. The following individuals were consulted with respect to representations and
warranties relating to tax matters:
a) Theodore Vogcl, Vice President of Energy;
b) Jay Silverman, Director of Tax Planning and Assistant Tax Counsel of Energy;
and
c) Gary Grande, Principal Tax Analyst of Energy.
12. Beverly Burger, Assistant Treasurer, Consumers, was consulted with respect
to representations and warranties relating to financial matters.
13. The following individuals were consulted with respect to representations and
warranties generally:
a) David Baughman, Executive Director, Financial Advisory Services and Strategic
Planning of Seller;
b) Doug Detterman, Director, Financial Advisory Services and Strategic Planning
of Seller.
Section l.l(ii) Material Adverse Effect
See Attachment A with respect to Clause (A) of the definition of “Material
Adverse Effect”.
Section 3.3(a) Generation Interests
1. See item 1 in Section 3.3(c).

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Section 3.3(b) Generation Interests
None.
Section 3.3(c) Generation Interests
1. The Generation Shares are pledged to lenders under the CMS Energy Sixth
Amended and Restated Secured Credit Facility.
2. Ability to transfer the Generation Shares is restricted under the Bank of
America settlement documents with Seller, Generation and CMS ERM.
3. See matters identified in Section 3.4.
Section 3.3(d) Generation Interests
1. See matters identified in Section 3.4.
Section 3.3(e)(i) Generation Interests
See matters identified in Parts B and C of Section 3.3(f).
Section 3.3{e)(ii) Generation Interests
1. See matters identified in Part A of Section 3.3(f).

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Section 3.3(f) Generation Interests
A. Capital Structure:

                          Authorized/Outstanding             Capital Stock (or  
  Entity Name   Jurisdiction   Ownership Interest)   % Ownership Interest
CMS Energy UK Limited
  England and Wales limited liability company   100 shares authorized 100 shares
outstanding     100 %
 
               
JORF:
               
 
               
CMS Enterprises International LLC
  Michigan limited liability company   Sole membership interest     100 %
 
               
CMS Enterprises Investment Company 1
  Cayman Islands corporation   50,000 shares authorized 100 shares outstanding  
  100 %
 
               
CMS Generation Investment Company IV
  Cayman Islands corporation   50,000 shares authorized 200 shares
outstanding     100 %
 
               
CMS Generation Luxembourg SA.R.L.
  Luxembourg societc B rcsponsabilitc limitee   150 shares authorized 150 shares
outstanding     100 %
 
               
CMS Generation Investment Company 11
  Cayman Islands corporation   50,000 shares authorized 100 shares outstanding  
  100 %
 
               
CMS Generation Netherlands B.V.
  Netherlands corporation   900 shares authorized 185 shares outstanding     100
%
 
               
CMS Generation Jorf Lasfar I Limited Duration Company
  Cayman Islands limited duration company   50,000 shares authorized 100 shares
outstanding     100 %
 
               
CMS Generation Jorf Lasfar II Limited Duration Company
  Cayman Islands limited duration company   50,000 shares authorized 100 shares
outstanding     100 %

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                          Authorized/Outstanding             Capital Stock (or  
  Entity Name   Jurisdiction   Ownership Interest)   % Ownership Interest
Jorf Lasfar Power Energy Akticbolag
  Sweden corporation   1,000,000 shares authorized 10,000 shares outstanding    
100 %
 
               
Jorf Lasfar EnergiAktiebolag
  Sweden corporation   10,000 shares authorized 10,000 shares outstanding    
100 %
 
               
JorfLasfar Handelsboiag
  Sweden general partnership   Partnership interests     100 %
 
               
Jorf Lasfar I Handelsboiag
  Sweden general partnership   Partnership interests     100 %
 
               
Jorf Lasfar Power Energy Handelsboiag
  Sweden general partnership   Partnership interests     100 %
 
               
Jorf Lasfar Energy Company, S.C.A.
  Morocco partnership limited by shares   Class A Common: 220 shares authorized
220 shares outstanding (Generation indirectly holds 50%) Class B Common: 5,280
shares authorized 5,280 shares outstanding (Generation indirectly holds 50%)
Class C Preferred:     50 %
 
      20,231,086 shares
authorized 20,231,086
shares outstanding
(Generation holds 0%)        
 
               
CMS International
Operating Company
  Cayman Islands corporation   50,000 shares authorized
100 shares outstanding     100 %
 
               
CMS Generation Jorf Lasfar III Limited
Duration Company
  Cayman Islands limited duration company   50,000 shares authorized
100 shares outstanding     100 %

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                          Authorized/Outstanding             Capital Stock (or  
  Entity Name   Jurisdiction   Ownership Interest)   % Ownership Interest
CMS Generation UK Operating Private Limited
  England and Wales limited liability company   50,000 shares
authorized 101 shares
outstanding     100 %
 
               
Jorf Lasfar Akticbolag
  Sweden corporation   1,000 shares authorized 1,000 shares outstanding     100
%
 
               
Jorf Lasfar Operations Handclsbolag
  Sweden general
partnership   Partnership interests     100 %
 
               
CMS Morocco Operating Co., S.C.A.
  Morocco partnership
limited by shares   1,000 shares
authorized 1,000
shares outstanding     100 %
 
               
NEYVELI:
               
 
               
CMS Generation Investment Company III
  Cayman Islands corporation   50,000 shares authorized 100 shares
outstanding     100 %
 
               
CMS Generation Ncyvcli Ltd.
  Mauritius corporation   10,000 shares
authorized 100 shares
outstanding     100 %
 
               
ST-CMS Electric Company Pvt. Ltd.
  India corporation   450,000,000 shares
authorized 400,492,332
shares outstanding     49.999 %
 
               
CMS (India)
Operations &
Maintenance Company
Private Limited
  India corporation   400,000 shares
authorized 263,177
shares outstanding     100 %
 
               
JUBAIL:
               
 
               
CMS Generation
Investment Company
VII
  Cayman Islands
corporation   50,000 shares
authorized 100 shares
outstanding     100 %

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                          Authorized/Outstanding             Capital Stock (or  
  Entity Name   Jurisdiction   Ownership Interest)   % Ownership Interest
CMS Jubaii Investment Company 1
  Cayman Islands corporation   50,000 shares authorized 100 shares
outstanding     100 %
 
               
Jubaii Energy Company
  Saudi Arabia
limited liability
company   Membership interests     25 %
 
               
SHUWEIHAT:
               
 
               
Shuweihat General Partner Company
  Cayman Islands corporation   50,000 shares authorized 10 shares outstanding  
  50 %
 
               
Shuweihat Limited Partnership
  Cayman Islands
limited partnership   Partnership interests     50 %
 
               
Shuweihat O&M General Partner Company
  Cayman Islands corporation   50,000 shares
authorized 10 shares
outstanding     50 %
 
               
Shuweihat O&M Limited Partnership
  Cayman Islands limited partnership   Partnership interests     50 %
 
               
Shuweihat CMS
International Power
Company
  U.A.E. Abu Dhabi Emirate private joint stock corporation   67,500,000 shares
authorized
67,500,000 shares outstanding     20 %
 
               
TAKORADI:
               
 
               
CMS Generation Investment Company VI
  Cayman Islands corporation   50,000 shares authorized 100 shares
outstanding     100 %
 
               
CMS Takoradi Investment Company
  Cayman Islands corporation   50,000 shares authorized 100 shares outstanding  
  100 %
 
               
CMS Takoradi Investment Company 11
  Cayman Islands corporation   50,000 shares
authorized 100 shares
outstanding     100 %

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                          Authorized/Outstanding             Capital Stock (or  
% Ownership Entity Name   Jurisdiction   Ownership Interest)   Interest
Takoradi
  Cayman Islands   Class A:   90% beneficial
International Company
  corporation  
10 shares authorized
10 shares outstanding
(Generation owns 100%)   interest
 
               
 
      Class B:        
 
               
 
      10 shares authorized
10 shares outstanding
(Generation owns 0%)        
 
               
 
      Class C:        
 
               
 
      16,000,000 shares
authorized
955,513 shares
outstanding
(Generation owns
613,351 shares)        
 
               
 
      Class D:        
 
               
 
      3,000,000 shares authorized 0 shares outstanding        
 
               
 
      Class E:        
 
               
 
      1,000,000 shares
authorized
0 shares outstanding        
 
               
TAWEELAH:
               
 
               
Taweelah A2 Operating Company
  Michigan
corporation   60,000 shares authorized
10 shares outstanding     100 %
 
               
CMS Generation Taweelah Limited
  Cayman Islands corporation   50,000 shares authorized
100 shares outstanding     100
§ %
 
               
Emirates CMS Power Company
  UA.E. Abu Dhabi Emirate private joint stock corporation   41,324,000 shares
authorized
41,324,000 shares
outstanding     40 %

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B. Pledged Shares/Transfer Restrictions:
Shuweihat
1. Shares of Shuweihat held by Shuweihat Limited Partnership are pledged to
secure the debt financing of Shuweihat pursuant to the US$1,286,500,000 Facility
Agreement dated 1 December 2001 between, inter alia, Shuweihat CMS International
Power Company, inter alia, Abu Dhabi Investment Company, Barclays Capital.
Citibank N.A., Krcditanstalt fur Wiedcrautbau, National Bank of Abu Dhabi, The
Bank of Tokyo-Mitsubishi, Ltd. and The Royal Bank of Scotland pic as lead
arrangers, and Barclays Bank PLC as facility agent (together with all related
Finance Documents, as such term is defined in the Facility Agreement)
(“Shuweihat Financing”).
2. Ability to transfer ownership interest in Shuweihat, directly or indirectly,
is restricted under the Shuweihat Financing documents (includes both
restrictions and change in control provisions).
3. Ability to transfer ownership interest in Shuweihat, directly or indirectly,
is restricted under the SI Shareholders Agreement (includes both restrictions
and change in control provisions).
4. Ability to transfer ownership interest in Shuweihat CMS, directly or
indirectly, is restricted under the Shuweihat Limited Partnership Agreement and
the Shuweihat General Partner Shareholders Agreement (contains restrictions,
change in control, and right of first refusal provisions).
Taweelah
1. Shares of Taweelah held by CMS Generation Taweelah Limited arc pledged to
secure the debt financing of Taweelah pursuant to the US$391,000,000 Facility
Agreement dated 15 March 2004 between, inter alia, Emirates CMS Power Company,
Australia and New Zealand Banking Group Limited and Soctetc Generale as joint
coordinating arrangers and Barclays Bank PLC as facility agent (together with
all related Finance Documents as such term is defined in the Facility Agreement)
(“Taweelah Financing”).
2. Ability to transfer ownership interest in Taweelah, directly or indirectly,
is restricted under the Taweelah Financing documents (includes both restrictions
and change in control provisions).

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3. Ability to transfer ownership interest in Taweeiah, directly or indirectly,
is restricted under the A2 Shareholders Agreement (includes both restrictions
and change in control provisions).
Takoradi
1. Ability to transfer ownership interest in Takoradi, directly or indirectly,
is restricted under the Takoradi Shareholders Agreement (includes both
restrictions and change in control provisions).
Jorf’
1. The ownership interests in Jorf held by Jorf Lasfar Power Energy Aktiebolag,
Jorf Lasfar Energi Aktiebolag, and Jorf Lasfar Handclsholag have been pledged to
secure the senior debt financing of Jorf described in the Common Agreement dated
September 4, 1997 among Jorf, ABN AMRO Bank N.V., Chicago Branch, ABN AMRO Bank
N.V., Amsterdam Branch, Credit Suisse First Boston, New York Branch, Banque
Nationale De Paris, Bankers Trust Company, ABN AMRO Bank (Maroc) SA,
Export-Import Bank of the United States and Overseas Private Investment
Corporation (together with all related Financing Documents, as such term is
defined in the Common Agreement), as amended by Amendment No, 1 to Common
Agreement dated October 23, 2001 and Amendment No.2 to Common Agreement dated
March 14, 2006 (“Jorf Financing”).
2. The ownership interests in Jorf Lasfar Power Energy Aktiebolag and Jorf
Lasfar EnergiAktiebolag held by CMS Generation Netherlands B.V. have been
pledged to secure the Jorf Financing.
3. The ownership interests in Jorf Lasfar Handelsbolag held by CMS Generation
Jorf Lasfar I LDC and CMS Generation Jorf Lasfar il LDC have been pledged to
secure the Jorf Financing,
4. The ownership interests in Jorf Lasfar I Handclsholag and Jorf Lasfar Power
Energy Handelsbolag, who were the predecessors in interest of Jorf Lasfar Power
Energy Aktiebolag and Jorf Lasfar EnergiAktiebolag with respect to their
ownership interests in Jorf were also pledged by CMS Generation Jorf Lasfar I
LDC and CMS Generation Jorf Lasfar II LDC to secure the Jorf Financing. To Liens
in favor of the Jorf senior lenders will not be applicable ai the Closing Dale
if the Jorf senior loans are repaid by Jorf with funds provided from or arranged
by Buyer prior to ihe Closing Date as opposed to the consent of these lenders
being obtained.
the Knowledge of Seller, these earlier share pledge agreements were not
terminated at the time of the intercompany transfer of the ownership interests.
5. Ability to transfer ownership interest in Jorf directly or indirectly, is
restricted under the Jorf Financing documents (includes both restrictions and
change in control provisions).
6. Ability to transfer ownership interests in Jorf, directly or indirectly, is
restricted under the CMS Generation Investment Company IV Credit Agreement
(includes both restrictions and change in control provisions),
7. Ability to transfer ownership interest in Jorf, directly or indirectly, is
restricted under the partnership agreement for Jorf (includes restrictions and
right of first refusal).
8. The ability to transfer ownership interests of CMS Generation Investment
Company IV outside of the indirect control of Energy is restricted under the CMS
Generation Investment Company IV Credit Agreement.
Neyveli
1. The ownership interests in Neyveli held by CMS Generation Neyveli Limited
have been pledged to secure the senior debt financing of Neyveli pursuant to the
Loan Agreement dated 19th March 2005 among Neyveli and Punjab National Bank,
Bank Of Baroda, Canara Bank, Central Bank Of India, Corporation Bank, Federal
Bank Limited, Indian Overseas Bank, Karur Vysya Bank Limited, Oriental Bank Of
Commerce, State Bank Of Bikaner And Jaipur, State Bank Of Hyderabad, State Bank
Of Patiala, State Bank Of Saurashtra, State Bank Of Travancore, Syndicate Bank &
Union Bank Of India as Lenders and Punjab National Bank as Lenders Agent and
Punjab National Bank as Security Agent (together with all related Finance
Documents, as such term is defined in the Loan Agreement) (“Neyveli Financing”).
2. Ability to transfer ownership interests in Neyveli held by CMS Generation
Neyveli Limited is restricted under the Neyveli Financing documents (includes
both restrictions and change in control provisions).
3. Ability to transfer ownership interests in Neyveli held by CMS Generation
Neyveli Limited is restricted under the shareholders agreement of Neyveli
(includes both restrictions and change in control provisions).

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Jubail
1. All of the shares of CMS Jubail Investment Company I have been pledged by CMS
Generation Investment Company VII to Riyad Bank, London Branch pursuant to that
certain Share Legal Mortgage in Respect of Shares of CMS Jubail Investment
Company I, dated as of July 14, 2003.
2, The shares in Jubail that arc owned by CMS Jubail Investment Company I are
subject to the terms and conditions of (i) the Shareholders’ Agreement of Jubail
Energy Company, dated as of June 23, 2003 between CMS Jubail Investment Company
1 and National Power Company Holdings, (ii) the Articles of Association of
Jubail Energy Company, (iii) the Energy Conversion Agreement, dated as of
July 9, 2003 between Jubail and Saudi Petrochemical Company, (iv) the Credit
Agreement dated July 14, 2003 among Jubail, Banque Saudi Fransi and Credit
Agricole Indosuez, as Arrangers, the Financial Institutions, Banque Saudi Fransi
as Facility Agent, Issuing Bank and Onshore Account Bank, and Riyad Bank, London
Branch as Offshore Account Bank and Global Security Agent, and (v) the Equity
Agreement dated July 14, 2003 among Jubail, CMS Jubail Investment Company 1 and
National Power Company Holding, as Shareholders, Generation, Mr. Khaled M.
Elseif and Hamed A. Al-Zamil & Brothers Co., as Equity Parents, CMS Generation
Investment Company VII and National Power Company, as Sponsors, Banque Saudi
Fransi, as Facility Agent, and Riyad Bank, London Branch, as Global Security
Agent.
General
1. Ability to transfer ownership interest in Takoradi, directly or indirectly,
is restricted under the Memorandum and Articles of Association of Takoradi
(includes both restrictions and change in control provisions).
2. Ability to transfer ownership interest in Jorf, directly or indirectly, is
restricted under the Bylaws of Jorf (includes restrictions and right of first
refusal).
3. Ability to transfer ownership interest in Neyveli, directly or indirectly, is
restricted under the Memorandum and Articles of Association of Neyveli,
4. Ability to transfer ownership interest in Jubail, directly or indirectly, is
restricted under the Articles of Association of Jubail.

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5. Ability to transfer ownership interest in CMS (India) Operations &
Maintenance Company Private Limited is restricted under the Articles of
Association of CMS (India) Operations & Maintenance.
6. Ability to transfer ownership interest in CMS Generation Netherlands B.V. is
restricted under the Articles of Association of CMS Generation Netherlands B.V.
7. Ability to transfer ownership interest in Jorf Lasfar Aktiebolag is
restricted under the Articles of Association of Jorf Lasfar Aktiebolag.
8. Ability to transfer ownership interest in Jorf Lasfar Handelsboiag is
restricted under the Partnership Agreement of Jorf Lasfar Handelsboiag.
9. Ability to transfer ownership interest in Jorf Lasfar I Handelsboiag is
restricted under the Partnership Agreement of Jorf Lasfar I Handelsboiag.
10. Ability to transfer ownership interest in Jorf Lasfar Operations
Handelsboiag is restricted under the Partnership Agreement of Jorf Lasfar
Operations Handelsboiag.
11. Ability to transfer ownership interest in Jorf Lasfar Power Energy
Handelsboiag is restricted under the Partnership Agreement of Jorf Lasfar Power
Energy Handelsboiag.
C. Options, Warrants and Rights to Purchase:
1. Takoradi Power Company (Ghana) Limited has the right under the Shareholders
Agreement for Takoradi to acquire up to fifty percent of the ownership interest
in Takoradi.
2. Shareholder loans held by Emirates Power Company and CMS Generation
Investment Company VI1 are convertible into common stock of Taweelah. These
loans have been pledged to secure the Taweelah Financing.
3. Partner loans made by Jorf Lasfar Handelsboiag, Jorf Lasfar Power Energy
Aktiebolag, Jorf Lasfar EnergiAktiebolag, and Tre Kronor Investment AB are
convertible into common shares in Jorf. These loans have been pledged to secure
the Jorf Financing.
4. Class C shares in Jorf held by subsidiaries of ABB are convertible into
common shares of Jorf.
5. CMS Takoradi Investment Company II has agreed to transfer 21,930 Class C
Shares in Takoradi to Takoradi Power Company (Ghana) Limited for $219,305 in
connection with actions taken by those two shareholders to correct inaccuracies
in the share register of Takoradi and to implement the shareholders’ intended
percentage allocation of ownership interests in Takoradi,
6. The bylaws of Jorf contain provisions regarding the contribution of
additional capital and the issuance of additional equity interests or adjustment
of equity interests in connection with such contribution of additional capital.
7. The Memorandum and Articles of Association of Neyveli contain provisions
regarding the issuance of additional shares.
8. The Articles of Association of Jubail contain provisions regarding the
issuance of additional shares.

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Section 3.3(h) Generation Interests

          Entity Name   % Ownership Interest
INDIA:
       
ST-CMS Electric Company (Mauritius)
    41.5 %
 
       
SHUWEIHAT:
       
Shuweihat Shared Facilities Company LLC
    33.33 %
 
       
TAWEELAH:
       
Taweelah Shared Facilities Company LLC
    15.8 %

Section 3.3(h) Generation interests
1. Takoradi: A portion of the Takoradi facility was built outside of the
boundaries of the site in which Takoradi was granted the right to use under the
Power Purchase Agreement.

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Section 3,4 Consents and Approvals
Governmental Consents:
1. Approval of one or more Moroccan governmental entities may be required for
the matters provided for in Section 5.4 of the Agreement.
2. Notifications to FERC regarding change in ownership of Exempt Wholesale
Generators and Foreign Utility Companies.
Joif Consents2:
1. Consent of the Jorf project lenders and/or ABB is required, including:3
a) Consent pursuant to 6.13(a)(z) of the Common Agreement for a transfer of
ownership interests in Jorf;
b) Waiver pursuant to Section 6.13(b) of the Common Agreement that prohibits a
general partner of Jorf from making any direct or indirect disposition of its
interest in Jorf;
c) Consent pursuant to Section 6.9(f) of the Common Agreement which prohibits
Jorf from entering into or permitting the assignment by Energy of its
obligations pursuant to the CMS Capital Contribution Agreement;
d) Waiver of Section 5.11 of the Common Agreement which requires that the CMS
Capital Contribution Guarantee by Energy be kept in full force and effect;
e) Waiver of Section 7.9(a) of the Common Agreement, which makes it an event of
default if any transaction document ceases to be in full force and effect;
2Consents and approvals by the Jorf senior lenders will not be required if the
senior debt is refinanced with funds provided from or arranged by Buyer prior to
the Closing Date.
3Consents and approvals by the Jorf lenders will not be required if the senior
debt is refinanced with funds provided from or arranged by Buyer prior to the
Closing Date. Under the Partnership Agreement of Jorf, this would require the
conseni of some or all of the ABB partners.

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f) Consent pursuant to Section 8.05(b) of each of the CMS Capital Contribution
Agreements, which prohibit the assignment of the obligations thereunder;
g) Waiver of Section 6.13(a)(i) of the Common Agreement which requires that
there be not less than 25% beneficial US ownership of Jorf;
h) Consent for replacement of Energy guaranties; and
i) Consent for replacement of Seller’s guaranty of CMS Morocco Operating
Company’s obligations under the Operations and Maintenance Agreement with Jorf
2. Consent of Office National de l’Eleclricite (“ONE”) may be required under
Section 9.3 of Jorf Power Purchase Agreement as result of O&M operator not being
an affiliate of CMS Generation Co., a Michigan corporation.
3. Implied consent of Jorf is required.4
Takoradi Consents:
1. Consent of Takoradi Power Company (Ghana) Limited under the Takoradi
Shareholders Agreement.
Taweelah Consents:
1. Consent of the sixty-percent shareholder required for change in control under
the Shareholders Agreement for Taweelah.
2. Project lender consent if Buyer does not meet the criteria for a “Qualifying
Investor” as such term is defined in the Taweelah financing documents.
3. Consent of ADWEA necessary for the assignment by Energy of its indemnity
obligation to ADWEA supporting the debt service reserve letter of credit
provided in connection with the Taweelah Financing.
4Under the Partnership Agreement of Jorf, this would require the consent of some
or all of the ABB partners.

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4. Consent of Siemens AG under the Scheduled Maintenance Agreements.
Neyveli Consents:
1. Consent of Neyveli is required to convert Generation to LLC pursuant to the
Neyveli Operations and Maintenance Guaranty,5
Restructuring Consents:
1. Severstal/Rouge consent needed for sale of Generation pursuant to the terms
of the waiver, dated May 26, 2004, to the DIG comfort letter.
2. Replacement of $100,000 bond with City of Flint backed by Generation (MMR).
3. Replacement of $675,000 bond with Connecticut EPA backed by Generation
(Exeter).
4. Pursuant to the Reimbursement and Credit Agreement for the Grayling
Generating Station Limited Partnership (the “Partnership”), the consent of the
Agent and the Majority Lenders will be required to amend or waive a provision
regarding the continuing ownership interest of Generation in the Partnership.
Consent of the partners to the Partnership Agreement will be needed to replace
Generation as guarantor.
5. Pursuant to the Operation and Maintenance Agreement for the Filer City
project, consent of Filer City LP will be required to amend or waive a provision
regarding the continuing ownership interest of Generation in the partnership.
6. Third party consents to the assignment of various rights, obligations,
instruments and agreements related to the development of wind generation
projects in North America currently owned by Generation.
7. Consent of: (i) Peabody Energy Corp. and Prairie State Generating Company,
LLC (“PSGC”), if required, to assignment of certain Guarantees delivered by
Generation in connection with the investment of CMS Prairie State, LLC in Lively
Grove Energy, LLC (“Lively Grove”) and indirect participation in the Prairie
State Energy Campus Project (the “Prairie State Project”); (ii) consent of
5Under the Shareholders Agreement of Neyveli, this would require die consent of
the ABB shareholder.
PSGC and the participants in the Prairie State Project to substitution of an
Affiliate of Energy for Generation under the Term Sheets for construction and
operation of the power plant delivered in connection with CMS Prairie State,
LLC’s investment in Lively Grove and the Prairie State Project; and
(iii) consent to assignment, if required, with respect to various agreements
entered into by Generation with respect to the Prairie State Project.
Other Consents:
1. Consent of lenders under the CMS Energy Sixth Amended and Restated Secured
Credit Facility with respect to release of Liens and sale of assets.
2. Waiver/Consent under the Bank of America Reimbursement Agreement as to
transfer of ownership of CMS Interests.
3. Consent of lenders under the CMS Generation Investment Company IV Credit
Facility with Barclays as administrative agent (the “CGIC Credit Agreement”) as
to (i) the Change in Control of CMS Generation Investment Company IV, (ii) the
replacement of Energy as Guarantor of the obligations of CMS Generation
Investment Company IV under the CGIC Credit Agreement, (iii) the incurrence by
Jorf of new or replacement indebtedness and the tenns thereof or any changes to
the existing Jorf senior debt financing or project documents, (iv) the
prepayment by Jorf of its senior debt with funding provided from or arranged by
the Buyer, and (v) changes to or replacement of existing, or granting of new,
consents, approvals, and waivers from any Moroccan governmental authorities.6
6
Approvals by these lenders will not be required because the loan will be
refinanced with funds provided from or arranged by Buyer prior to the Closing
Date.
Section 3.5 No Conflict or Violation
See matters identified in Section 3.4.
Section 3.6(a) Contracts
1. Escrow and Disbursement Agreement dated October 8, 1999 between Tamil Nadu
Electricity Board (“TNEB”), Neyveli and State Bank of India, as Escrow Agent
2. Security and Hypothecation Agreement between TNEB and Neyveli, dated
October 8, 1999

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Section 3.6(b) Contracts
Takoradi:
1. Under the Takoradi Shareholders Agreement, (i) the shareholders failed to
cause shares to be issued as capital contributions were made as required under
the terms of the Shareholders Agreement and (ii) as a result of (i), the
shareholders have caused distributions and other economic benefits and
liabilities to be allocated on a basis other than legal shareholding percentages
as required under the terms of the Shareholders Agreement. Both shareholders are
aware of this matter, and while corrective action has been commenced, the
measures have not been finalized.
2. Takoradi may be in breach under its Power Purchase Agreement for failing to
construct the electricity meters specified in the agreement. Although the Volta
River Authority (“VRA”) is aware of this discrepancy, no formal waiver has been
obtained.
3. Both parties may be in breach of the Power Purchase Agreement for the
Takoradi project in that they have, through a course of conduct, varied from the
express requirements of the power purchase agreement without formally amending
the document, including with respect to allocation of fuel procurement
responsibility, construction of a portion of the Takoradi plant outside of the
site boundary specified in the power purchase agreement and failure to enter
into a site lease on a timely basis, and failure of Takoradi to transfer certain
interconnection facilities and fuel handling facilities to the Volta River
Authority upon completion of their construction.
4. Takoradi may be in breach under its Power Purchase Agreement for failing to
obtain insurance with the requisite deductible levels. The Volta River Authority
has been informed of the variance, but no formal waiver has been obtained.
5. Takoradi may be in breach of the Government Consent and Support Agreement for
failure to pay the Government of Ghana an amount equal to change in law gains
achieved by Takoradi as a result of reductions in the corporate tax rale.
Takoradi has reserved approximately $1,870,000 to cover the liability and has
been in discussions with the Government of Ghana regarding how and when to pay
this amount, including whether it can be offset against other possible amounts
owed to Takoradi.
Jorf:
1. CMS Morocco Operating Co. SCA and Jorf may be in default under the O&M Direct
Agreement for the Jorf financing as a result of amending the operation and
maintenance agreement for the Jorf project without obtaining the formal consent
of the Jorf senior lenders.
2. The pledge of shares of Seller and Generation in support of Energy corporate
financings may constitute a breach of the transfer restrictions in the Jorf
financing documents,
Neyveli:
1. See matters identified on Section 3.6(a).

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Section 3.6(c) Contracts
Sec matters identified on Section 3.6(a).
Takoradi:
1. Under the Takoradi Shareholders Agreement, (i) the shareholders failed to
cause shares to be issued as capital contributions were made as required under
the terms of the Shareholders Agreement and (ii) as a result of (i), the
shareholders have caused distributions and other economic benefits and
liabilities to be allocated on a basis other than legal shareholding percentages
as required under the terms of the Shareholders Agreement. Both shareholders are
aware of this matter, and while corrective action has been commenced, the
measures have not been finalized.
2. The Volta River Authority may be in default under the Power Purchase
Agreement for the Takoradi project for delinquent payments.
3. The Volta River Authority may be in default under the Escrow Agreement
established to secure payments under the Power Purchase Agreement for the
Takoradi project for failing to maintain the funding under that agreement at the
required level.
4. Both parties may be in breach of the Power Purchase Agreement for the
Takoradi project in that they have, through a course of conduct, varied from the
express requirements of the Power Purchase Agreement without formally amending
the document, including with respect to allocation of fuel procurement
responsibility, construction of a portion of the Takoradi plant outside of the
site boundary specified in the power purchase agreement and failure to enter
into a site lease on a timely basis, and failure of Takoradi to transfer certain
interconnection facilities and fuel handling facilities to the Volta River
Authority upon completion of their construction.
5. The Volta River Authority may be in default under the Interim Services
Agreement for the Takoradi project for failing to obtain insurance with the
requisite deductible levels.
Neyveli:
1. The Tamil Nadu Electricity Board may be in default under the Power Purchase
Agreement for the Neyveli project for failure to open the required escrow
account.
2. The Tamil Nadu Electricity Board may he in default under the Power Purchase
Agreement for the Neyveli project for failure to pay the Minimum Alternate Tax
portion of the tariff.
3. Tamil Nadu Electricity Board may be in breach of the terms of the Power
Purchase Agreement for the Neyveli project for failing to properly determine the
final project cost.

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Section 3.6(d) Contracts
A. Material Contracts:
1. Offshore Technical Services Agreement dated July 11, 2003 between Generation
and Jubail.
2. Onshore Technical Services Agreement dated July 11, 2003 between Generation
and Jubail,
3. Site Services Agreement dated July 9, 2003 between Saudi Petrochemical
Company and Jubail.
4. Paying Agent Agreement dated July 11. 2003 between Generation and Jubail,
5. Subordination Agreement dated July 9, 2003 between National Power Company
Holding, CMS Jubail Investment Company I as Junior Creditors and Saudi
Petrochemical Company as Senior Creditor and Jubail as Generator.
6. Credit Agreement dated July 14, 2003 relating to US$169,500,000 Facilities
for Jubail arranged by Banque Saudi Fransi and Credit Argicole with Banque Saudi
Fransi as Facility Agent (together with all related Finance Documents as such
term is defined in the Credit Agreement),
7. SADAF Corporate Loan Agreement dated July 9, 2003 relating to a Credit
Facility for Saudi Petrochemical Company (SADAF) arranged by Banque Saudi Fransi
and Credit Agricolc with Banque Saudi Fransi as Facility Agent and Riyad Bank,
London Branch as Global Security Agent (together with all related Finance
Documents as such term is defined in the SADAF Corporate Loan Agreement).
8. Customer Treasury Agreement dated July 8, 2003 between Banque Saudi Fransi
and Jubail.
9. Tripartite Letter dated July 9, 2003 between Jubail Energy Company, Banque
Saudi Fransi and Riyad Bank, London Branch.
10. Sub-Lease Agreement dated July 9, 2003 between Saudi Petrochemical Company
and Jubaii.
11. Shareholder’s Agreement dated June 23, 2003 by and between CMS Jubaii
Investment Company I and National Power Company Holding.
12. Energy Conversion Agreement dated July 9, 2003 between Saudi Petrochemical
Company (SADAF) and Jubaii as amended by Amendment Agreement dated April 25,
2006.
13. Turnkey Agreement dated July 10, 2003 between Jubaii and Siemens
Aktiengescllschaft for the Engineering, Procurement, and Construction of a
co-generation plant to be located at the petrochemical complex situated at
Madinat, Al-Jubail, Kingdom of Saudi Arabia.
14. Performance Guarantee 57264 dated July 10, 2003 by and between Siemens
Aktiengcsellschaft and Jubaii.
15. Retention Security No. 57278 dated July 10, 2003 by and between Siemens
Aktiengescllschaft and Jubaii.
16. Consent to Sub-Lease Agreement dated July 9, 2003 between The Royal
Commission for Jubaii and Yanbu and Saudi Petrochemical Company.
17. Deed of Novation dated July 9, 2003 between CMS Jubaii Investment Company I,
Hamed Abdullah Al-Zamil & Brothers Co., Saudi Petrochemical Company and Jubaii.
18. Deed of Novation dated July 9, 2003 between CMS Jubaii Investment Company I,
Hamed Abdullah Al-Zamil & Brothers Co., Siemens AG and Jubaii,
19. Long Term Parts and Services Contract dated September 20, 2005 between
Jubaii and Siemens Limited.
20. Policies for the insurance for Jubaii listed in Section 3.15(a).
Neyveli:

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1. Power Purchase Agreement dated 20lh November, 1996 between Neyveli and TNEB),
as amended by Addendum [ dated 9th October, 1997, Addendum II dated 27th
January, 1998, Addendum III dated 22nd January, 1999 and Addendum IV dated 25th
August, 1999, including the letter of credit issued in favor of Neyveli by TNEB
pursuant to the obligations of TNEB under the Power Purchase Agreement, and as
supplemented by the TNEB letter dated 15th March, 2005 approving refinancing of
project debt, the Neyveli letter dated 18th March, 2005 acknowledging and
agreeing to the terms of refinancing and the Letter Agreement dated 7th January,
2004 between TNEB and Neyveli changing the date of monthly invoice to 17th of
every month.
2. Guarantee dated 10th December 1996 executed by the Government of Tamil Nadu
in favor of Neyveli with respect to certain obligations of TNEB under the Power
Purchase Agreement.
3. Amended and Restated Operations and Maintenance Agreement dated 15th
November 1999 between Neyveli and CMS (India) Operations & Maintenance Company
Private Limited.
4. O&M Guarantee dated 25th October 1999 between Neyveli and Generation in
respect of the Operations and Maintenance Agreement, including the letter dated
18th March, 2005 providing consent to creation of security in respect of the
Guarantee in favor of new project lenders.
5. Fuel Supply Agreement dated 29th April, 1998 between Neyveli and Neyveli
Lignite Corporation.
6. Lignite Transportation Agreement dated 16 April 2002 between Neyveli and
Chettinad Lignite Transport Services (P) Ltd, as supplemented by the Letter
dated 22nd August, 2005 from Chettinad Lignite Transport Service (P) Ltd
requesting a waiver of the requirement for a bank guarantee under the Lignite
Transportation Agreement and agreeing to cancel the letters of credit provided
by shareholders, and the Letter dated 6th April, 2006 from Neyveli closing the
bank guaranty from Chettinad Lignite Transport Service (P) Ltd under the Lignite
Transportation Agreement.
7. Indenture of Lease dated 16th April, 2002 between Neyveli as lessor and
Chettinad Lignite Transport Services (P) Ltd as lessee,
8. Loan Agreement dated 19th March 2005 among Neyveli and Punjab National Bank,
Bank of Baroda, Canara Bank, Central Bank of India, Corporation Bank,

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Federal Bank Limited, Indian Overseas Bank, Karur Vysya Bank Limited, Oriental
Bank of Commerce, State Bank of Bikancr And Jaipur, State Bank of Hyderabad,
State Bank of Patiala, State Bank of Saurashtra, State Bank of Travancore,
Syndicate Bank & Union Bank of India as Lenders and Punjab National Bank as
Lenders Agent and Punjab National Bank as Security Agent (together with all
related Finance Documents, as such term is defined in the Loan Agreement).
9. Working Capital Consortium Agreement dated 18 March 2004 among Neyveli, State
Bank of India and Indian Overseas Bank, together with the Deed of Accession to
Working Capital Consortium Agreement dated 22nd March, 2004 for inclusion of
Bank of Baroda as a member of the Working Capital Consortium, as amended by
letter agreement dated 20 April, 2006.
10. DSRA LC Facility Agreement dated March 19, 2005 between Neyveli and Punjab
National Bank as the DSRA LC Provider (together with the Letter of Credit as
such term is defined in the DSRA LC facility Agreement).
11. Shareholders’ Agreement dated 2nd January, 1999 among ABB Power Investment
(India) B.V., CMS Generation Neyveli Limited and Neyveli, as amended by three
Letter Agreements each dated 29th January, 1999 and Amendment Agreement dated
15th May, 2003.
12. Subordinated Loan Agreement dated 9th November, 1999 between Neyveli and CMS
Generation Neyveli Limited relating to the provision of subordinated debt.
13. Subordinated Loan Agreement dated 9th November, 1999 between Neyveli and ABB
Power relating to the provision of subordinated debt.
14. Policies for the insurance for Neyveli listed in Section 3.15(a).
15. Escrow and Disbursement Agreement dated October 8, 1999 between TNEB,
Neyveli and State Bank of India, as Escrow Agent.
16. Security and Hypothecation Agreement between TNEB and Neyveli, dated
October 8, 1999.
Shuweihat:
1. Power and Water Purchase Agreement dated 31 July 2001 originally made between
Abu Dhabi Water and Electricity Company and Shuweihat Limited Partnership, and
to which Shuweihat CMS International Power Company became a party in place of
Shuweihat Limited Partnership pursuant to a Novation Agreement dated as of 28
November 2001, as the same is interpreted and construed in accordance with the
PWPA Direct Agreement dated 1 December 2001 between Shuweihat CMS International
Power Company, the Abu Dhabi Water and Electricity Company, and National Bank of
Abu Dhabi, as amended by First Amendment to Power and Water Purchase Agreement
dated 28 November 2001, Second Amendment to Power and Water Purchase Agreement
dated 28 January 2004, and Third Amendment to Power and Water Purchase Agreement
dated 21 July 2004.
2. Connection, Use of System and Interface Agreement dated 28 May 2003, between
the Shuweihat CMS International Power Company and Abu Dhabi Transmission and
Despatch Company.
3. Operation and Maintenance Agreement dated as of 28 November 2001 between
Shuweihat CMS International Power Company and Shuweihat O&M Limited Partnership.
4. Guarantee dated 28 November 200] issued by Generation in favor of Shuweihat
CMS International Power Company and others with respect to the obligations of
Shuweihat O&M Limited Partnership under the Operation and Maintenance Agreement,
5. Guarantee dated 28 November 2001 issued by International Power pic in favor
of Shuweihat CMS International Power Company and others with respect to the
obligations of Shuweihat O&M Limited Partnership under the Operation and
Maintenance Agreement.
6. Shareholders’ Agreement dated 31 July 2001 between Shuweihat Power Company
and Shuweihat Limited Partnership.
7. Land Lease Agreement dated as of 26 November 2001 between the Shuweihat
Shared Facilities Company LLC and the Abu Dhabi Water and Electricity Authority.
8. Land Lease Agreement dated as of 26 November 2001 between the Shuweihat CMS
Internationa] Power Company and the Abu Dhabi Water and Electricity Authority,
as the same is interpreted and construed in accordance with the SI Lease Direct
Agreement dated 1 December 2001 between Shuweihat CMS

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Internationa] Power Company, the Abu Dhabi Water and Electricity Authority, and
National Bank of Abu Dhabi.
9. Shareholders Agreement for Shuweihat Shared Facilities Company LLC dated 26
November 2001 between Shuweihat CMS International Power Company and Abu Dhabi
Power Corporation.
10. Guarantee dated 1 December 2001 issued by the Government of Abu Dhabi in
favor of Shuweihat CMS International Power Company.
11. Long Term Maintenance Contract dated 19 December 2003 between Shuweihat O&M
Limited Partnership and Siemens AG.
12. US$1,286,500,000 Facility Agreement dated 1 December 2001 between, inter
alia, Shuweihat CMS International Power Company, inter alia, Abu Dhabi
Investment Company, Barclays Capital, Citibank N.A., Kreditanstalt fur
Wiederautbau, National Bank of Abu Dhabi, The Bank of Tokyo-Mitsubishi, Ltd. and
The Royal Bank of Scotland pic as lead arrangers, and Barclays Bank PLC as
facility agent (together with all related Finance Documents, as such term is
defined in the Facility Agreement).
13. Islamic Facilities Agreement dated 1 December 2001 between, inter alia,
Shuweihat CMS International Power Company, Abu Dhabi Islamic Bank as lead
arranger and Islamic facilities agent, Dubai Islamic Bank and Kuwait Finance
House as joint arrangers, and Barclays Bank pic as facility agent (together with
all related Islamic Finance Documents, as such term is defined in the Islamic
Facilities Agreement),
14. Subordinated Loan Agreement effective 15 August 2004 between International
Power (Shuweihat) Limited and Shuweihat CMS International Power Company pursuant
to which International Power (Shuweihat) Limited advanced the total sum of
259,942,269.40 dirhams to Shuweihat CMS International Power Company (together
with any promissory note or other instruments evidencing such loan).
15. Subordinated Loan Agreement effective 15 August 2004 between Shuweihat Power
Company and Shuweihat CMS International Power Company pursuant to which
Shuweihat Power Company advanced the total sum of 379,413,404.09 dirhams to
Shuweihat CMS International Power Company (together with any promissory note or
other instruments evidencing such loan).

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16. Amended and Restated Limited Partnership Agreement for Shuweihat Limited
Partnership dated 28 November 2001 between CMS Generation Investment Company
VII, Internationa] Power (Shuweihat) Limited, and Shuweihat General Partner
Company.
17. Amended and Restated Limited Partnership Agreement for Shuweihat O&M Limited
Partnership dated 28 November 2001 between CMS Generation Investment Company
VII, International Power (Shuweihat) Limited, and Shuweihat O&M General Partner
Company.
18. Shareholders Agreement for Shuweihat General Partner Company dated
November 28, 2001 between CMS Generation Investment Company VII and
International Power (Shuweihat) Limited.
19. Shareholders Agreement for Shuweihat O&M General Partner Company dated
November 28, 2001 between CMS Generation Investment Company Vll and
International Power (Shuweihat) Limited.
20. Side Letter Agreement dated 28 November 2001 between CMS Generation
Investment Company Vll and International Power (Shuweihat) Limited.
21. Turnkey Agreement dated 26 November 2001 between Shuweihat and Siemens
Aktiengesellschaft and Fisia Italimpianti S.p.A.
22. Turnkey Agreement dated 28 November 2001 between Shuweihat and Logica UK
Limited.
23. Performance guarantee issued by Siemens Financial Services GmbH in favor of
Shuweihat in support of the Siemens/Fisia Turnkey Agreement,
24. Performance guarantee issued by San Paulo Imi in favor of Shuweihat in
support of the Siemens/Fisia Turnkey Agreement.
25. Policies for the insurance for Shuweihat listed in Section 3.15(a),
Taweelah:
1. Power and Water Purchase Agreement dated 3 October 1998 originally made
between Abu Dhabi Water and Electricity Company and CMS Generation Taweeiah
Limited, and to which Emirates CMS Power Company became a party in place of CMS
Generation Taweelah Limited pursuant to a Novation Agreement dated as of 20
December 1998, as the same is interpreted and construed in accordance with the
PWPA Direct Agreement dated 15 March 2004 by and between Emirates CMS Power
Company, the Abu Dhabi Water and Electricity Company, and HSBC Middle East Bank
Limited, Abu Dhabi Branch, as amended by a First Amendment dated 19 March 2006
and a Second Amendment dated 31 October 2006.
2. Connection, Use of System and Interface Agreement dated March 3, 2001,
between the Emirates CMS Power Company and Ahu Dhabi Transmission and Despatch
Company.
3. Amended and Restated Management, Operation and Maintenance Agreement dated as
of 25 April 1999 between Emirates CMS Power Company and Taweelah A2 Operating
Company.
4. Guarantee dated 27 April 1999 issued by Generation in favor of Emirates CMS
Power Company and others with respect to the obligations of Taweelah A2
Operating Company under the Amended and Restated Management, Operation and
Maintenance Agreement.
5. Shareholders’ Agreement dated 3 October 1998 between Emirates Power Company
and CMS Generation Taweelah Limited.
6. Amended and Restated Land Lease Agreement dated as of 22 March 1999 between
the Taweelah Shared Facilities Company LLC and the Abu Dhabi Water and
Electricity Authority.
7. Amended and Restated Land Lease Agreement dated as of 22 March 1999 between
the Emirates CMS Power Company and the Abu Dhabi Water and Electricity
Authority, as the same is interpreted and construed in accordance with the A2
Lease Direct Agreement dated 15 March 2004 between Emirates CMS Power Company,
the Abu Dhabi Water and Electricity Authority, and HSBC Middle East Bank
Limited, Abu Dhabi Branch.
8. Amended and Restated Shareholders Agreement for Taweelah Shared Facilities
Company LLC dated 22 March 1999 between Emirates CMS Power Company, Bainounah
Power Company and the Taweelah Power Company, as amended by a First Amendment
dated 19 March 2006 and a Second Amendment dated 31 October 2006.

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9. Guarantee dated 27 April 1999 issued by the Government of Abu Dhabi in favor
of Emirates CMS Power Company.
10. Scheduled Maintenance Agreement dated 26 September 1999 between Taweeiah A2
Operating Company and Siemens AG.
11. Scheduled Maintenance Agreement dated 2 March 2006 between Taweeiah A2
Operating Company and Siemens AG.
12. US$391,000,000 Facility Agreement dated 15 March 2004 between, inter alia,
Emirates CMS Power Company, Australia and New Zealand Banking Group Limited and
Societc Gencrale as joint coordinating arrangers and Barclays Bank PLC as
facility agent (together with all related Finance Documents as such term is
defined in the Facility Agreement).
13. Islamic Facilities Agreement dated 1 5 March 2004 between, inter alia.
Emirates CMS Power Company, Abu Dhabi Islamic Bank as mandated lead arranger and
Islamic facilities agent, and Barclays Bank pic as facility agent (together with
all related islamic Financing Documents as such term is defined in the Islamic
Facilities Agreement).
14. Loan Agreement dated 20 December 1998 between CMS Generation Taweeiah
Limited and Emirates CMS Power Company pursuant to which CMS Generation Taweeiah
Limited advanced the total sum of 108,800,000 dirhams to Emirates CMS Power
Company (together with any promissory note or other instruments evidencing such
loan).
15. Loan Agreement dated 20 December 1998 between Emirates Power Company and
Emirates CMS Power Company pursuant to which Emirates Power Company advanced the
total sum of 163,200,000 dirhams to Emirates CMS Power Company (together with
any promissory note or other instruments evidencing such loan).
16. Turnkey Agreement dated 20 December 1998 between Emirates CMS Power Company
and Siemens AG and Korea Heavy Industries & Construction Co. Ltd.
17. Performance guarantee issued by American Express Bank in favour of Taweeiah
in support of the Turnkey Agreement.

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18. Performance guarantee dated 17 December 1998 issued by Siemens
Finanzierungsgesellschaft fur Informationstechnik mbH in favor of Taweelah in
support of the Turnkey Agreement.
19. Foreign Exchange Hedge Agreement Confirmation dated April 11, 2006 between
Taweelah and Barclays Bank pic, together with related [SDA Master Agreement
dated April 29, 1999.
20. Policies for the insurance for Taweelah listed in Section 3.15(a). Takoradi:
1. Restated Power Purchase Agreement dated 25 August, 1999 between Takoradi and
Volta River Authority, as amended by Letter Agreement dated 31 May 2006 and
Letter Agreement dated 26 September 2006.
2. Government Consent and Support Agreement dated 5 February 1999 between
Takoradi and Government of Ghana, as amended by Amending Deed to the Government
Consent and Support Agreement dated 11 January 2000.
3. Interim Services Agreement dated 24 November 1999 between Takoradi and Volta
River Authority, as amended by Letter Agreement dated 4 October 2005 and
supplemented by the Memorandum dated 2 May 2005.
4. Operations and Maintenance Agreement dated as of 1 1 February, 2000 between
Takoradi and CMS International Operating Company.
5. O&M Side Letter Agreement dated 11 February 2000 between Takoradi, CMS
International Operating Company, and Generation.
6. Long Term Service Agreement dated August 31, 2001 between Takoradi, GE Energy
Parts, Inc., and GE International, Inc. as amended by First Amendment executed
December 2004.
7. Letter of Agreement dated 12 May 2006 between Takoradi and GE Energy Parts,
Inc. regarding gas conversion work.
8. Restated Shareholders Agreement dated 25 August 1999 between Takoradi, CMS
Takoradi Investment Company II, Takoradi Power Company (Ghana) Limited, Volta
River Authority, and Generation.
9. Joint Venture Agreement dated 27 September 1996 between Generation and Volta
River Authority.
10.Collective Bargaining Agreement dated January 1, 2007.
11. Policies for the insurance for Takoradi listed in Section 3.15(a).
Jorf:
1. Agreement of Limited Partnership of Jorf Lasfar Energy Company dated
April 30, 1997 updated as of September 12, 2001 by and between Jorf Lasfar
Handelsbolag, Jorf Lasfar Power Energy Aktiebolag, Jorf Lasfar EnergiAktiebolag,
Tre Kronor Investment AB, AB Cythere 61, AB Cythere 63 as amended by Amendment
No. 3 dated December 24, 2004.
2. Side Bar Agreement dated December 11, 2000 among Tre Kronor Investment AB, AB
Cythere 61, AB Cythere 63, Jorf Lasfar Handelsbolag, Jorf Lasfar Power Energy
Aktiebolag and Jorf Lasfar EnergiAktiebolag.
3. General Manager Agreement dated March 20, 1998 by and between Jorf and ABB
Energy Ventures Inc.
4. Transfer of Possession Agreement dated September 11, 1997 between ONE and
Jorf, as amended by Amendment No. 1 to the Transfer of Possession Agreement
dated November 3, 2004.
5. Power Purchase Agreement dated September 11,1997 between ONE and Jorf, as
amended by Amendment Agreement No. 1 to Power Purchase Agreement dated
January 15, 2001 and Amendment No. 2 to Power Purchase Agreement dated
November 3, 2004.
6. ONE Letter of Credit dated August 3, 2006 in favor of Jorf.
7. Letter of Support and Guaranty of Termination Amount dated September 12, 1997
by The Kingdom of Morocco to Jorf, as confirmed by the Government of Morocco
Confirmation of Letter of Support and Guaranty dated November 4, 2004.

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8. Agreement Establishing the Terms of Operation of the Coal Terminal at the
Port of Jorf Lasfar dated September 11,1997 by and between The Office
d’ExpIoitation des Ports and Jorf
9. Construction and Procurement Agreement Relating to Unit 3 and Unit 4 of the
Coal Fired Power Station at Jorf Lasfar dated September 11, 1997 between ONE and
Jorf.
10. Coal Handling and Storage Agreement dated September 11,1997 between ONE and
Jorf.
11. Tax Convention between Jorf and the Government of Morocco dated July 11,
1997 between the Government and Jorf.
12. Equipment Supply Agreement dated September 4, 1997 between Jorf, ABB Power
Generation Ltd., ABB Sae Sadclmi S.p.A. and Combustion Engineering, Inc. for the
Jorf Lasfar Power Project (Units 3 and 4) in Jorf Lasfar, Morocco and as amended
by Amendment No. I to Equipment Supply Agreement dated October 9, 1997.
13. Installation and Construction Agreement dated September 4, 1997 between Jorf
and S.I.M, Societa Italiana Montaggi S.p.A. for the Installation and
Construction of Jorf Lasfar Power Project (Units 3 and 4) in Jorf Lasfar,
Morocco as amended by Amendment No. I to Installation and Construction Agreement
dated October 9, 1997.
14. Coordination Agreement dated September 4, 1997 among Jorf, S.I.M. Societa
Italiana Montaggi S.p.A., ABB Power Generation Ltd., ABB Sae Sadelmi S.p.A. and
Combustion Engineering, Inc.
15. EPC Parent Guarantee dated September 12, 1997 by Asca Brown Boveri Ltd. to
Jorf.
16. Operation and Maintenance Agreement dated September 4, 1997 by and between
Jorf and CMS Morocco Operating Co. SCA, as supplemented by the Agreement
Regarding the Operator’s Available Capacity Incentive Payments and Liquidated
Damages dated October 24, 2000 between Jorf, ABB GP and CMS GP.
17. Guaranty dated September 4, 1997 by Seller in favor of Jorf.

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18. CSA 849 Coal Supply Agreement dated October 16, 2006 by and between Glencore
International AG and Jorf.
19. CSA 851 Coal Supply Agreement dated November 3, 2006 by and between Energy
Coal S.p.A. and Jorf.
20. CSA 853 Coal Supply Agreement dated December 9, 2006 by and between Energy
Coal S.p.A. and Jorf.
21. CSA 855 Coal Supply Agreement dated December 21, 2006 by and between
Coeclerici Coal and Fuels S.p.A. and Jorf.
22. CSA 857 Coal Supply Agreement dated January 1 2, 2007 by and between BHP
Billiton Marketing AG and Jorf,
23. CSA 859 Coal Supply Agreement dated January 26, 2007 by and between Coal
Marketing Company and Jorf.
24. CSA 734 LT Coal Supply Agreement dated September 15, 2005 by and between
Bulk Trading and Jorf.
25. CSA 736 LT Coal Supply Agreement dated May 4, 2006 by and between Glencore
International AG and Jorf.
26. CSA 738 LT Coal Supply Agreement dated September 20, 2006 by and between
Glencore International AG and Jorf.
27. Jorf Pension Plan transfer agreements to (1) Caisse de Depot et de Gestion
(“CDG”) and (2) CDG’s affiliates Regime CollectifdAllocation Retraite and Caisse
Nationale de Retraites et dAssurances.
28. Caisse Interprofcssionclle Marocainc de Retraites retirement fund program
statutes and Jorf affiliation form to this program.
29. Common Agreement dated September 4, 1997 among Jorf, ABN AMRO Bank N.V.,
Chicago Branch, ABN AMRO Bank N.V., Amsterdam Branch, Credit Suisse First
Boston, New York Branch, Banque Nationale De Paris, Bankers Trust Company, ABN
AMRO Bank (Maroc) SA, Export-Import Bank of the United States and Overseas
Private Investment Corporation (together with all related Financing Documents,
as such term is defined in the Common Agreement), as amended by Amendment No. 1
to Common Agreement dated October 23, 2001 and Amendment No.2 to Common
Agreement dated March 14, 2006.
30. Eximbank Credit Agreement dated September 4, 1997 by and between Jorf, ABN
AMRO Bank, N. V., Chicago Branch, as Agent and The Financial Institutions now
and hereafter party thereto as Lenders (together with all related Company
Documents, as such term is defined in the Eximbank Credit Agreement).
31. Funding and OPIC Guaranty Agreement dated September 4, 1997 among Overseas
Private Investment Corporation, First Trust of New York, National Association,
Bank of America, National Trust and Savings Association and Jorf (together with
all related Company Documents and OPIC Funding Documents as such terms are
defined in the Funding and OPIC Guaranty Agreement).
32. Finance Agreement dated September 4, 1997 between Jorf and Overseas Private
Investment Corporation.
33. Sponsor Project Support Agreement dated September 4, 1997 between Generation
and Overseas Private Investment Corporation.
34. SACE Facility Agreement dated September 4, 1997 among Jorf, ABN AMRO Bank
N.V., Amsterdam Branch, as SACE-Guarantccd Agent, and The Financial Institutions
now and hereafter party thereto as SACE-Guaranteed Lenders (together with SACE
Facility Loans and SACE Facility Notes as defined in the SACE Facility
Agreement).
35. World Bank Facility Agreement dated September 4, 1997 among Jorf, ABN AMRO
Bank N.V., Chicago Branch, as World Bank Facility Agent, and the Financial
Institutions now or hereafter party to as World Bank-Guaranteed Lenders
(together with World Bank Facility Loans and World Bank Facility Notes as
defined in the World Bank Facility Agreement).
36. ERG Facility Agreement dated September 4, 1997 among Jorf, Credit Suisse
First Boston, New York Branch, as ERG-Guaranteed Agent and The Financial
Institutions now or hereafter party thereto as ERG-Guaranteed Lenders (together
with ERG Facility Loans and ERG Facility Notes as defined in the ERG Facility
Agreement).

27

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37. Company Loan Agreement dated September 4, 1997 among Jorf, ABN Amro Bank
N.V., Chicago Branch, as Company Loan Agent and The Financial Institutions now
or hereafter party thereto as Company Lenders (together with Company Loan
Intercreditor Agreement, Company Loan Interest Rate Hedge Agreements, Company
Loan Pemiits, Company Loan Security Documents, Obligations, Security Agreement
and Sharing Letter as defined in the Company Loan Agreement), as amended by
Amendment No. 1 dated December 11, 2000 and Amendment No.2 dated January 1,
2003.
CGIC Loan
1. Credit Agreement dated December 15, 2005 among CMS Generation Investment
Company IV, as Borrower, the Lenders party thereto as Lenders and Barclays Bank
PLC, as Administrative Agent (together with Account Control Agreement, Fee
Letters, Hedging Agreement, Loan Documents, Obligations, Loans, Security
Documents and Subordination Agreement as defined in the Credit Agreement) as
amended by Amendment No. 1 dated August 31, 2006.
2. Guaranty dated December 15, 2005 from Energy as Guarantor to Barclays Bank
PLC, as Administrative Agent.
Prairie State:
1. CMS Buy-In Guaranty dated October 10, 2006.
2. CMS Development Period Guarantee and Indemnity dated October 10, 2006.
3. Peabody Buy-In Guaranty dated October 10, 2006.
Other:
1, Amended and Restated GPDC Consulting Agreement dated February 8, 1999 between
General Power Development Company and CMS Energy U.K. Limited, as amended by
Amending Deed in October, 2000, a Second Amending Deed in November, 2000, and a
Third Amending Deed dated May 4, 2001.
2, Service Agreement dated March, 1998 originally between Arabian Construction
Company and CMS Energy Asia Pte Ltd, as to which CMS Generation Investment
Company VII became a party in place of CMS Energy Asia Pte Ltd pursuant to an
Assignment and Assumption Agreement dated as of 1 November 2006.
3, Services Agreement dated October 25, 1997 originally between ADCECO Group and
CMS Energy Asia Pte Ltd, as to which CMS Energy UK Limited became a

28

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party in place of CMS Energy Asia Pte Ltd pursuant to an Assignment of Services
Agreement dated 20 December, 1999.
4. Master Consulting Services Agreement dated I August 2003 between Generation
and Hawks, Giffels & Pullin (HGP) Inc., as amended by a First Amendment dated 29
March 2005 (together with all Task Releases issued in connection therewith).
5. Generation is a guarantor under the 5300,000,000 Sixth Amended and Restated
CMS Energy Secured Credit Facility.
6. Reimbursement Agreement dated as of December 8, 2003 among, inter alia, Bank
of America, N.A. and Generation.
7. Guaranty issued by Generation in favor of the State of Connecticut Department
of Environmental Protection, dated May 14, 1996, in the amount of $675,000
relating to the closure or post-closure care of a facility owned by Exeter
Energy Limited Partnership in Sterling, Connecticut
8. Share Sale Agreement dated 3 July. 2003 among Generation, CMS Generation
Investment Company I, CMS Generation Loy Yang Holdings 1 Ltd, CMS Generation Loy
Yang Holdings 2 Ltd, NRGenerating B.V. No. 4, Horizon Energy Investment Limited,
GEAC Operations Pty Ltd, and Great Energy Alliance Corporation Pty Ltd, as
amended by a Deed of Amendment dated 2 September 2003, a Second Deed of
Amendment dated 19 December 2003, a Third Deed of Amendment dated 8
January 2004, a Fourth Deed of Amendment dated February 12, 2004, and a Fifth
Deed of Amendment dated March 2004.7
9. Sale and Purchase Agreement dated 18 April 2002 among Mirant Toledo Holdings
Corporation, A. Soriano Corporation, CMS Generation Investment Company 1, and
Generation.
10. Generation has entered into an Agreement of Indemnity, dated as of
December 9, 1994, in favor of Safeco Insurance Company of America and other
named entities (“Safeco”) pursuant to which Generation has agreed to indemnify
Safeco from all loss and expense in connection with any bonds issued by Safeco
at Generation’s request. On December 9, 1994 Safeco issued a surety bond at
Generation’s request in the amount of $100,000 in favor of the City of Flint,
Michigan in connection with the performance of Mid-Michigan Recycling, L,C.
(“MMR”)
7Seller will indemnify Buyer for liabilities arising in connection with this
agreement.
under that certain Lease Agreement dated February 16, 1994 between MMR and the
City of Flint.
11. Securities Purchase Agreement dated December 3 1, 2003 between CMS Energy
Investment LLC, Generation, and UASGP LLC.
12. Contribution Agreement dated December 31, 2003 between Generation and CMS
Energy Investment LLC,
13. Amended and Restated Limited Partnership Agreement dated as of January 1,
1992, between CMS Generation Grayling Company (“CMS Grayling GP”), CMS
Generation Grayling Holdings Company (“CMS Grayling LP”) and Grayling
Development Partners, which includes a guaranty by Generation of certain
obligations of CMS Grayling GP and CMS Grayling LP.
14. Agreement dated as of July 7, 1995 by and among Generation, The AES
Corporation and AES Argentina, Inc. relating to Generation’s retained 0.1%
ownership interest in then-named CMS Generation San Nicolas Company, first
exercisable on or about July 7, 2010.
B. Intercompany Loans;
Sec Attachment A,
Section 3.6(c) Contracts
1. Copies of certain Material Contracts with respect to Jubail have not been
made available to Buyer for confidentiality reasons. These Material Contracts
will be made available to the Buyer once the consent of the relevant third
parties has been obtained.
2. Copies of the following Material Contracts have not been made available to
Buyer for confidentiality reasons:
a) Share Sale Agreement dated July 3, 2003, as described in item 8 under “Other”
of Part A in Section 3.6(d).
b) Sale and Purchase Agreement dated April 18, 2002, as described in item 9
under “Other” of Part A in Section 3.6(d).
3. Copies of the following Material Contracts with respect to Shuweihat have not
been made available to the Buyer because the Seller docs not have copies of such
documents within its possession or control:
a) Items 20 and 25 under “Shuweihat” of Part A in Section 3.6(d) hereto.

29

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Section 3.7 Compliance with Law
1. Takoradi may be in violation of Ghanaian law for failure to collect VAT on
electricity sales pursuant to the power purchase agreement. This issue has been
raised and is under discussion with the Ghanaian tax authorities. Sec item 1
under Takoradi in Section 3.14(c).
2. Sec matters identified in Section 3.8 and Section 3.9.
Section 3.8 Permits
1. The Takoradi plant is currently being operated without water injection for
NOx control as a result of the VRA’s failure to provide adequate water for that
purpose. The local office of the government’s environmental agency is aware of
this and has neither expressly permitted the operation nor issued a formal
notice of noncompliance.
2. The Takoradi plant is not currently meeting its noise requirements as a
result of high ambient noise levels from the ocean. The local office of the
government’s environmental agency is aware of this and has neither expressly
permitted the operation nor issued a formal notice of noncompliance.
3. The Takoradi plant is currently being operated without a permanent generating
license. A temporary license was issued and is effective to 31 March 2007
pending issuance of the permanent license, the application for which has been
submitted.
4. TNPCB, Chennai

                                  2006 — 2007             Date for   Applied for
  Approved         DESCRIPTION   REFERENCE   renewal   renewal on   on   Valid
till   Remarks
Plant — Consent to Operate under Sec. 21 of the Air Act, 1981
  16215 dt. 24/12/2004   31-Mar-2006   31 -Jan-06   5-Apr-06   30-Sep-06   In
the earlier consent issued, TNPCB had stipulated certain directions. Neyveli
filed an appeal before Appellate authority under Air/Water Act. TNPCB has been
restrained from proceeding further. Neyveli has applied for extension of consent
to operate up to 31st Mar 07 within the required time. In the past, TNPCB has
not been prompt in providing consents to operate.

30

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                                  2006 — 2007             Date for   Applied for
  Approved         DESCRIPTION   REFERENCE   renewal   renewal on   on   Valid
till   Remarks
Plant — Consent to operate under sec.25 of the Water Act, 1974
  20166 dt. 24/12/2004   31-Mar- 2006   31-Jan-2006   5-Apr-06   30-Sep-06  
Same as above
 
                        TNPCB consent for collection, storage and disposal ol”
Hazardous waste under Rule 3(c) and 5(5) of hazardous wastes rules 1989  
1900/04 dated 7.4.2004   Amendment for Revised qty.applied on 16.3.2006   This
is generally a one time approval. Neyveli has applied tor increase in removal of
used/waste oil which is pending. j

Section 3.9 Litigation
1. Jubail Co-Generation Plant — Warranty Claim: During a planned plant outage in
April, 2006, the gas turbine blades and vanes were found to have thick layers of
contamination. The project duiy submitted warranty notices under the EPC
Contract with Siemens to complete the repairs and/or replacements necessary to
remedy the contamination. Siemens rejected the notices, claiming that the
contamination was the result of improper maintenance and operation. The
necessary repairs and replacements were completed during an unscheduled outage
under a change order that fully reserved the parties’ rights. The costs
associated with the repairs and work, including the revenue loss associated with
the outage, totaled approximately S19,000,000. The project has reached a
settlement in principle with Siemens that would confer a benefit of $4,756,665
to the project. Siemens may, however, be attempting to renegotiate certain terms
of the settlement. The project has also submitted an insurance claim relating to
the contamination, which remains pending.
2. Jubail -Warranty Claim on Unit #12 FG Compressor: For a more detailed
description of this matter, see the item 2 of Section 3.15(d).
3. Neyveli — Pollution Disputes:
a) Petition filed in Madras High Court by ST-CMS Environmental Affected Welfare
Associations.
b) Petition filed in Madras High Court by Vadalur Sarvodaya Nagar and Boomidhan
Residents Welfare Association.
c) Petition filed by Mr. Dhanasekharan and others of Vadalur Sarvodaya Nagar
against Neyveli/CLTS.
4. Neyveli — Central Excise and Service Tax:
a) LSHS procurement without Excise duty — Appeals have been filed with CESTAT.
b) Service tax liability for O & M Services. For a more detailed description of
this dispute, see the item noted under Neyveli in Part A of Section 3.14(c).

31

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Section 3.10(a) Employee Matters
1. Employee Handbook for Takoradi, including all benefit arrangements described
therein, as modified by the Collective Bargaining Agreement dated January },
2007.
2. Letter dated April 29, 2005 between Generation and Malcolm Wrigley regarding
a grossed-up payment of US taxes for Mr, Wrigley for the year 2006 and for the
first seven months of 2007.
3. Employment letter dated April 30, 2004 from CMS Morocco Operating Company SCA
to Abdelmajid lraqui Houssaini.
4. Takoradi International Company/CMS International Operating Co. Staff
Provident Fund Rules and Articles of Association.
Section 3.10(b) Employee Matters
None.
Section 3.10(h) Employee Matters
None.
Section 3.10IT) Employee Matters
None.
Section 3.10(1) Employee Matters
None.

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Section 3.11 Labor Relations
1. Takoradi: The employees at Takoradi have recently voted to join the
Industrial and Commercial Union, The union will represent roughly 40 of the 64
employees currently working at the plant. A collective bargaining agreement
dated January 1, 2007 was entered into between Takoradi and the union.
2. Neyveli’. Within the last 12 months there have been efforts to unionize
employees. The Industrial Workers consist of 20 unskilled employees. In the
past, they have expressed possible interest in joining a labor union. In the
event of a successful unionization of these employees, there would be no effect
on the operations of the plant as these particular employees are not involved in
plant operations.
3. Jorf: The majority of Jorfs employees are unionized. A Moroccan Statute for
Personnel is in effect providing worker rights, compensation, benefits, and
other matters relating to Jorfs unionized employees. In addition, there are
agreements that supplement core benefits accorded to such employees under this
applicable Moroccan Statute. Non-union employees are covered under the Moroccan
Labor Code. This Labor Code, which also applies to the unionized employees,
provides workers rights under this Moroccan Law,
Section 3.12(a) Intellectual Property
None.
Section 3.12(f) Intellectual Property
None.

33

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Section 3.13 Environmental Matters
Neyveli:
1. The Neyveli plant received two separate notices from environmental
authorities regarding fugitive dust, and has responded to those notices.
Takoradi:
1. The Takoradi facility shares space on the site of the VRA’s Takoradi Tl
plant. VRA has responsibility for treatment of oily water and discharge of clean
water to a surface drain which outfalls to an adjacent wetland. There have been
several events of oily water discharges reaching the wetlands.
2. VRA has disposed of contaminated materials from the Tl plant in a waste pit
located between the plant site and the ocean shore, reportedly with the verbal
approval of the Ghana EPA. A limited amount of similar material from Takoradi
has apparently also been deposited in this location.
Taweeiah A2:
1. In late 2004, the Taweeiah A2 facility experienced an accidental release of
approximately 1250 gallons of oil onto the ground. Spilled oil did not reach
groundwater or surface water. Contaminated soil was removed and bioremcdiated.
Other:
I. Sec matters identified in Section 3,8 and Section 3.9.
Section 3.14(a) Tax Matters
Jorf:
1. The 2005 Dutch Tax Return for CMS Generation Netherlands, B.V. has been
extended until April 1, 2007.
2. No Luxembourg Tax Returns have been filed for CMS Generation Luxembourg
S.A.R.L. for the years from 2001 through 2005.
3. The 2003 UK. Tax Return for CMS Generation UK Operating Company was filed
late and a penalty in excess of $10,000 could be incurred depending upon the
amount of tax ultimately determined to be due.
Takoradi:
1. A corporate tax audit for the years 2000-2004 was settled earlier this year
with Takoradi making the payments proposed in the Ghanaian government’s
October 24, 2005 tax audit report, a copy of which has been delivered as part of
the due diligence.
Section 3.14(b) Tax Matters
Takoradi:
1. Takoradi has provided certain local employees with accommodations but failed
to tax those benefits (as rent element) in the hands of the employees. Exposure
is estimated at roughly $50,000.
2. Takoradi makes payments to CMS Resources relating to employment costs for
seconded staff. CMS Resources invoices Takoradi at cost plus a 10%
administration fee. For a period of time, Takoradi was not withholding on the
10% mark-up, but probably should have been withholding at a 20% rate.
3. Takoradi failed to withhold on GE invoices from January 1, 2005 through
June 30, 2005 relating to the offshore work under the Long Term Services
Agreement. (Under withholding for earlier periods was resolved as part of the
audit referenced in Item 1 in Section 3.14(a) above.) The tax liability for 2005
is estimated at roughly $100,000.

34

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Section 3.14(c) Tax Matters
A. Material Disputcs:
Entity. Jurisdiction Tax Type
Generation Maine (unitary filing) Income
Years 1998
Generation
Michigan
(consolidated filing)
SBT
1998
Issue
Sales factor treatment of sale of power purchase agreement. Resolution will not
affect separate company liability. Use of business loss carryforwards in
consolidation. Resolution will not affect the separate company liability.
Takoradi:
1. Takoradi wrote to the Ghanaian VAT Service on 29 November 2005 requesting a
determination of the VAT status of Takoradi’s PPA invoices to the VRA. Several
meetings have been held since that time variously amongst the VRA, Takoradi, the
VAT Service, PricewaterhouseCoopers (PWC — tax advisors to Takoradi) and the
Ministry of Finance to progress this issue. A resolution is still pending;
however, based on these meetings CMS is of the view that there arc three
potential alternative rulings from the VAT Service. These are that Takoradi’s
supplies to the VRA should be either: (i) zero rated (thus no VAT payable); or
(ii) normally rated at 15% VAT but that the VRA may provide “VAT Relief Purchase
Orders” to Takoradi in lieu of payment which Takoradi then submits to the VAT
Service along with the VAT return; or (iii) normally rated at 15% with a special
arrangement (either directed from the VAT Service or to be agreed directly with
the Ministry of Finance) to resolve the status of past invoices. There is the
theoretical, though highly unlikely, possibility that Takoradi could be required
to turn over to the government 15% VAT on all invoicings to date, but not be
able to recover all such amounts from the VRA. This is held to be highly
unlikely as it is believed that Takoradi was not in breach of the law in not
invoicing for VAT pending a determination on the VAT status of Takoradi’s
invoices based on meetings and correspondence with the VAT Service in early
2001. There is a strong possibility that the final determination from the VAT
Service will allow Takoradi to recover input VAT going forward (worth roughly
USD300k per year)

35

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as well as the possibility that Takoradi could recover past input VAT going back
three years.
2. Takoradi entered into a binding letter of intent with a non-Ghanaian
affiliate of General Electric for the supply of parts and services in connection
with the gas conversion project. While it is anticipated that this letter of
intent will be replaced by a more detailed contract, parts were provided and
paid for during 2006 under the letter of intent. Based on advice from its and
General Electric’s tax advisors, Takoradi requested a ruling from the Ghanaian
tax authority that such nonresident activities would not be subject to 20%
nonresident withholding. The tax authority disagreed, however, and asserted that
20% withholding is required, although based upon past practices by the taxing
authority it is anticipated that 20% of the invoices will be exempted from
withholding as attributable to the actual cost of parts. If withholding is
required, payment to the General Electric affiliate must be grossed-up. Assuming
in accordance with past practices that the tax authority exempts 20% of the
invoices as attributable to the actual cost of parts, the withholding obligation
will be approximately $550,000. Takoradi is continuing discussions with the tax
authority regarding its ruling, (n addition, Takoradi has notified the VRA that
it would expect the VRA to be responsible for any increased costs as a result of
the withholding as VRA has already agreed to reimburse Takoradi for the other
costs of the gas conversion.
Neyveli:
1. Service Tax of approximately Rs 60 million ($1,300,000) exclusive of
penalties and interest has been assessed against the CMS (India) O&M Company by
the Indian government. Seller has been advised that there is a strong case
against the applicability of such tax. However, under the terms of the
Operations and Maintenance Agreement between Neyveli and the O&M Company, the
liability would be passed through to Neyveli if such tax is determined to be
due.
2. Regarding CMS (India) Operations and Maintenance Company, the Indian tax
authorities have raised an income tax issue on audit for the assessment years
ended March 31, 2003. 2004, and 2005. The amounts involved are approximately
$116,000, $101,000, and $260,000, respectively. The issue involves the lack of
payment of withholding tax on reimbursement of expatriate costs from CMS (India)
Operations and Maintenance Company to CMS Resource Development Company and a
resultant increase in income tax. The tax for the March 31, 2004 assessment year
has been paid and the issue appealed to the Commissioner of Income-tax (Appeals)
who has ruled in favor of CMS. Indications are, however, that the Indian tax
authorities will continue to appeal the issue. At some point, the issue could be
raised with respect to the March 31, 2006 and 2007 assessment years as well.
Jorf:

36

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1. The United Kingdom government is asserting that interest income should be
imputed with respect to certain dividends declared by Jorf Lasfar Aktiebolag
(Sweden) for the time period between when such dividends were declared and paid
to the United Kingdom. Maximum exposure is estimated at $500,000. Seller has
been advised that most of such imputation is improper under European Union
inter-country tax rules; however, CMS has offered to settle the issue for much
lesser amount [e.g., $80,000] in order to avoid litigation costs.
Other:
1. See matters identified as item I in Section 3.7 and item 3 in Section 3.9.
B. In come Tax Return Filings (periods ending on or after January 1, 2002):

                  Entity   Jurisdiction   Years   Audii Status
CMS Energy Consolidated
  federal     2002-2005     Not audited
Group
               
Generation
  California     2002-2005     Not audited
Generation
  Connecticut     2002-2005     Not audited
Generation
  Flint, Michigan     2002-2003     Not audited
Generation
  Jackson, Michigan     2002-2005     Not audited
Generation
  Michigan     2002-2004     Under audit 2002-2003
CMS Enterprises
International LLC
  Michigan     2004     Not audited
CMS Generation Neyveli Ltd.
  Mauritius     2002-2004     Not yet audited
ST-CMS Electric Company
Private Limited
  India     2002-2006     Audits complete for 2002, 2003, and 2004. 2005 and
2006 not yet audited.
Takoradi International
Company
  Ghana     2002-2005     Audits completed for 2002-2004; 2005 not audited.
Jubaii Lnergy Company
  Saudi Arabia     2005     Not yet audited
CMS (India) Operations &
Maintenance Company Pvl
Ltd
  India     2002-2005     Audited for year ended 3/03; oiher years not yet
audited.
Jorf Lasfar Operations
Handelsboiag
  Sweden     200[2]-2005     No years audited
Jorf Lasfar Aktiebolag
  Sweden     2002-2005     No years audited
Jorf Lasfar Power Energy
Aktiebolag
  Sweden     2002-2005     No years audited
Jorf Lasfar
Energi Aktiebolag
  Sweden     2002-2005     No years audited
Jorf Lasfar 1 Handelsboiag
  Sweden     2002-2005     No years audited
Jorf Lasfar Power Energy
  Sweden     2002-2005     No years audited
Handelsboiag
               
Jorf Lasfar Handelsboiag
  Sweden     2002-2005     No years audited
CMS Generation UK Operating Pvt. Ltd.
  United Kingdom     2002-2004     Currently under audit for 2003 and 2004; 2002
not audited.
CMS Morocco Operating
Company SCA
  Morocco     2002-2005     No years audited
CMS International
Operating Ghana Branch
  Ghana     2002-2005     No years audited
CMS Generation
  Netherlands     2002-2005     No years audited
Netherlands B.V. Jorf
  Morocco     2002-2005     Notification of audit of income tax for fiscal years
ended August 2003, August 2004, December 2004, and December 2005, VAT for
calendar years 2003,2004, and 2005, and payroll income tax for calendar years
2003,2004, and 2005
CMS Generation UK Limited
  United Kingdom     2002-2004     No years audited
See Attachment A hereto.
               

Section 3.14(d) Tax Matters

37

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Section 3.14(e) Tax Matters
1. SeeTakoradi — Item 1 on Section 3.14(c).
Section 3.14(a) Tax Matters
Waivers of Statute of Limitations:
Entity Jurisdiction Years Expiration Date
CMS Energy Consolidated Federal 2002 12/31/07
Group
CMS Energy Michigan Michigan 1998-2003 In abeyance while
Consolidated Group deficiency is contested

38

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Section 3.15(a) Insurance
A. Summary of Significant Insurance Policies for Energy:
* The following insurance policies are specifically designed to cover Energy and
its subsidiaries and partnerships. These insurance policies are not assignable
or transferable to a buyer.

                          PoIicy___   Coverage   Insurer   Term   Limit of
Liability   Deductibles
 
                       
Primary and Excess Directors & Officers Liability Insurance
  Insures Energy’s and subsidiaries directors and officers and individuals
serving on partnerships and joint ventures For wrongful acts in their respective
capacities, (claims made policy form)   AEGIS
XL Specialty
EIM
American Casualty
The Hartford (Twin
City Fire)   December 27, 2006 to December 27, 2007     5100,000,000    
Individuals: Snil
deductible
Company
reimbursement: $10,000,000
 
                       
Excess General
Liability
  Third party legal liability and automobile liability, (claims first-made
policy form)   AEGIS
EIM
EIBL   June 30, 2006 to June 30, 2007     1135,000,000     £500,000 each
occurrence and excess of primary and umbrella insurance tor Energy subsidiaries
and certain partnerships and joint ventures
 
                       
Fidelity Insurance
  Insurers Energy and subsidiaries for Employee Dishonesty, Loss or money inside
and outside the premises, credit card forgery and computer & funds transfer
fraud coverage   National Union
Great American   April 1, 2006 to April 1, 2007   $ 20,000,000     $150,000
perloss
$10,000 Credit Card
Forgery Coverage
 
                       
Fiduciary Insurance
  Insures Energy and subsidiary employee benefit plan sponsors and fiduciaries
oTthe plans against claims arising out of administration and duties for the
plans   AEGIS
XL Specialty
ESM   June 30, 2006 to June 30, 2007   $ 60,000,000     $2,500,000 Sponsor
Organization for each wrongful act.

39

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B. Summary of Insurance Policies Provided by Energy for Seller and Generation:
* The following insurance policies are issued to Energy but specifically
designed to cover Seller and Generation and subsidiaries and partnerships both
in the U.S. and internationally. The insurance policies are generally not
transferable to a buyer.

                      Policy   Coverage   Insurer   Terra   Limit of Liability  
Deductibles
 
                   
US Workers Compensation and Employers Liability
  Injury to workers
in US locations   Pacific
Indemnity
Company   November 1, 2006 to November 1, 2007   Statutory Workers
Compensation EL
$1,000,000 each
accident/dis
ease/employee   None
 
                   
US Primary
Automobile
Liability
  Third party bodily injury and property damage liability and physical damage to
owned and hired vehicles   Federal
Insurance
Company   November 1, 2006 to November 1, 2007   $1,000,000 each
accident   $500 collision and comprehensive
 
                   
US Primary General Liability Including Products Completed Operations,
Advertising, Employee Benefits, and Garage Keepers Liability
  Third party personal injury and properly damage liability for occurrences,
(occurrence based policy form)   Federal
Insurance
Company   November 1, 2006 to November 1, 2007   $5,000,000 Gen
Aggregate Limit (per
location)
51,000,000
occurrence limit   $10,000 per occurrence Subject to $5,000 per claim property
damage liability Benefits Liability $1,000 per claim
 
                   
International General Liability Includes Products Completed Operations,
Advertising, Damage to Rental Premises
  Third party personal injury and properly damage liability for occurrences that
occur outside the USA. (occurrence based policy form)   Great Northern
Insurance
Company   November 1, 2006 to November 1, 2007   11,000,000 per occurrence and
general aggregate   NA
 
                   
International
Workers
Compensation
  Non US voluntary workers compensation and Employers Liability   Great Northern
Insurance
Company   November 1, 2006 to November 1, 2007   Statutory benefits in Country
of Origin or State of Hire EL limit $1,000,000    
 
                   
International
Automobile
Liability
  Excess insurance for accidents involving automobiles owned or leased to  
Great Northern
Insurance
Company   November 1, 2006 to November 1, 2007   S1,000,000   Excess and
Difference in Condition over compulsory local limits in each country or $50,000
whichever is greater

40

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C. Summary of Insurance Policies For Generation Owned and/or Operated Project
Companies:
* The following insurance policies are specifically designed to cover Generation
as operator and project owners or partnership interests; including those of
lenders, offtakers, etc. The insurance policies are generally transferable to a
buyer, but are subject to loan terms and other contractual requirements.
I. Jorf Project

                      Policy   Coverage   Insurer   Term   Limit of Liability  
Deductibles
 
                   
Property Damage and Business Interruption Package Policy
  Insures against damage to plant property and equipment and resulting business
interruption from all risk perils and boiler and machinery breakdown   Royale
Marocaine d’Assuranccs (local insurer) supported by quota shared reinsurance:
Zurich, AXA, Allianz, Liberty, AIG, ACE, Nurnberger, SCR   July 1, 2006 to July
1, 2009 (3 yr. term policy annually renewable)   S: ,319,060,000 Property damage
5146,368 fixed daily indemnity for Business Interruption subject to S427.400.000
overall Bl limits. Sub limits lor certain of co verage extensions   51,000,000
PD and Machinery Breakdown 60 days for Bl
 
                   
Terrorism Insurance
  Insurers against acts of terrorism for damage to property and business
interruption   Royale Marocaine d’Assurances (local insurer) supported by quota
shared reinsurance: Zurich, AIG,
Interliamiover, SCR   July 1, 2006 to July 1, 2007   550,000,000   SI,000.000 PD
60 days for Bl
 
                   
General Liability, Employers Liability, Contingent and non owned auto liability,
Wharfingers
Liability
  Third party personal injury and property damage liability for occurrences.  
Zurich Maroc (local) supported by reinsurance of Zurich Ins Co   July 1, 2004 to
July 1, 2007   General Liability: 530,000,000 per occurrence and annual
aggregate Wharfingers Liability: 520,000,000 per occurrence and annual aggregate
  5100,000 perclaim property damage, bodily injury and wharfingers liability
 
                   
Automobile Liability and Physical Damage
  Liability insurance
for local Moroccan
law   RMA Watanaya   January 1, 2006 to January 1, 2007 tacit annual renewal  
Statutory Limits in Morocco plus damage to vehicles    
 
                   
Workers Compensation
  Statutory Insurance
coverage in Morocco   RMA Watanaya   January 1, 2006 to January 1, 2007 tacit
annual renewal   Statutory limits in
with Workers laws
in Morocco    
 
                   
Marine Cargo
Insurance
  All risks for coal
shipments   Wafa Insurance and Zurich Maroc   January 1, 2006 to January 1, 2007
tacit annual renewal   DH 50,000,000   NA

2. Takoradi Project

                      Policy   Coverage   Insurer   Term   Limit of Liability  
Deductibles
 
                   
Property Damage and Business Interruption Package Policy
  Insures Takoradi against damage to plant property and equipment and resulting
business interruption from all risk perils and boiler and machinery breakdown  
State Insurance Co
Ghana (local
insurer) supported
by quota shared
reinsurance:
Zurich, A1G, ACE,
Partner Re, AEGIS,
African Re   March 1, 2006 to March 1, 2007   $112,063,000 Property damage
$51,673,650 Bl limits. Sub limits for certain of coverage extensions   $250,000
PDand S 500,000 Mach Breakdown 45 days for BI (60 days tor T’G if spare rotor
not available)
 
                   
Terrorism Insurance
  Insurers against acts of terrorism for damage to property and business
interruption   State Insurance Co
Ghana
(local insurer)
supported by quota
shared reinsurance: Lloyds of London   March 1, 2000 to March 1, 2007   S
50,000,000   $1,000,000 PD 60
days forBI
 
                   
General Liability, Employers Liability, Contingent and Non Owned Auto Liability,
Named Peril Pollution
  Third party personal injury and property damage liability for occurrences.  
State Insurance Co Ghana (local insurer) supported by reinsurance from AEGIS and
QBE International   March 1, 2006 to March 1, 2007   General Liability:
$15,000,000 per occurrence and annual aggregate   55,000 per claim property
damage liability subject to $25,000 per occurrence for pollution events
 
                   
Automobile Liability and Physical Damage
  Liability insurance
for local Ghana law   Purchased Locally
at the Plant       Statutory Limits in Ghana plus damage to vehicles    
 
                   
Workers Compensation
  Statutory Insurance
coverage in Ghana   Purchased Locally
at the Plant       Statutory limits in
accordance with
Workers laws in
Ghana    

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3. Jubail Project

                      Policy   Coverage   Insurer   Term   Limit of Liability  
Deductibles
 
                   
Property Damage and Business Interruption Package Policy Coverage provided under
a consol idated insurance policy provided by Saudi Basic Industries Co.
  Insures Jubail against damage to plant property and equipment and resulting
business interruption from all risk perils and boiler and machinery breakdown  
NCC1 (.local insurer) supported by quota shared and layered reinsurance: Zurich,
AXA, AMianz, Lloyds, A1G.ACE, AXIS, SCOR, Arch, etal.   June 1, 2006 to June 1,
2007   $155,016,000 Property damage $44,657,000 Business interruption Sub limits
for certain of coverage extensions   S1,000,000 PD and Machinery Breakdown
60 days for Bl
 
                   
Terrorism Insurance
  Insurers against acts of terrorism for damage to property and business
interruption   NCC1 (local
insurer) supported
by quota shared
reinsurance: Lloyds   June 1, 2006 to June 1, 2007   $200,000,000
combined single
limit   $1,000,000 PD 60
days for Bl
 
                   
General Liability, Products, Employers Liability, Contingent and Non Owned Auto
Liability
  Third party-personal injury and properly damage liability for occurrences.  
NCCI (local) supported by reinsurance of Zurich Ins Co   July 24, 2006 to
June 24, 2007   General Liability: $25,000,000 per occurrence and annual
aggregate   $10,000 per
occurrence
 
                   
Automobile Liability and Physical Damage Comprehensive Coverage and Excess of
Contingency Cover
  Liability insurance
for local Saudi
Arabian law   AXA Insurance Co   May 1, 2006 to April 30, 2007 tacit annual
renewal   Statutory Limits in Saudi Arabia plus damage to vehicles    
 
                   
Workers Compensation, Employers Liability and Excess GQSI Coverage
  Statutory Insurance
coverage in Saudi
Arabia   AXA Insurance Co   May 1, 2006 to April 30, 2007 tacit annual renewal  
Statutory limits in
accordance with
Workers laws in
Saudi Arabia    

42

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4. Neyveli (Neyveli Plant)

                      Policy   Coverage   Insurer   Term   Limit of Liability  
Deductibles
 
                   
Properly [Damage and Business Interruption Package Policy
  Insures Neyveli against damage to plant properly and equipment and resulting
business interruption from all risk perils and boiler and machinery breakdown  
ICIC1 Lombard and New India Assurance   December 16, 2006 to December 15, 2007  
1NR 14,741,000,000 Properly damage INK 3,976,000,000 overall 131 limits. Sub
limits for certain of coverage extensions   INR 23,000,000 PD and Mach Breakdown
30 days for Bl
 
                   
Terrorism Insurance
  Insurers against acts of terrorism for damage to property and business
interruption   1CICI Lombard   December 16, 2006 to December 15, 2007   Declared
Value INR 14,741,000,G00PD INR 3,976,000,000 overall Bl limits. Sum Insured Rs.
5,000,000,000 (PD&BI combined)   INR 90.000.000 PD and Bl combined
 
                   
General Liability
  Third party personal injury and property damage liability for occurrences,
(occurrence based policy form)   ICICI Lombard   December 16, 2006 to
December 15, 2007   General Liability; INR 460,000,000 in excess of INR
1,150,000,000   INR 460,000 per
occurrence
 
                   
Automobile Liability and Physical Damage
  Liability insurance
for local India law   No Information
-obtained at plain
site       No Information
- obtained at plant
site    
 
                   
Workers
Compensation And
Employers Liability
  Statutory Insurance
coverage in India   No Information
-obtained at plant
site       No Information
- obtained at plant
site    
 
                   
Directors &
Officers Liability
Insurance
  Insures Neyveli’s directors and key officers for wrongful acts in their
respective capacities   ICICI Lombard   April 1, 2006 to March 31, 2007   Rs.
20,000.000   Rs. 100,000 for each claim

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5. Taweelah Project

                      Policy   Coverage   Insurer   Term   Limit of Liability  
Deductibles
 
                   
Property Damage and Business Interruption Package Policy
  Insures Taweelah against damage to plant property and equipment and resulting
business interruption from all risk perils and machinery breakdown   Emirates
Insurance Company (local) Supported by a quota share and layered reinsurance
program: ASG, Zurich, Liberty, XL, Partner Re, Hannover Re, Lloyds, ACE, Aspen  
August 20, 2006 to August 20, 2007   $823,653,13° Property Damage and B)
combined limits. Off premises $1,500,000 Transit $6,000,000 Hzd Materials
$1,000,000 And additional Sub limits for certain other coverage extensions  
$1,000,000 PD Bl: 45 days except 60 days for loss in respect of gas or steam
turbines generators, HRSG, or main station transformers
 
                   
Terrorism insurance
  Insurers against acts of terrorism for damage to property on a site wide
policy covering GTTPC (AI), Taweelah A2 and TAPCO (B) projects.   Arab Orient
Insurance Company
(local)
Supported by
Layered Reinsurance
Program:   October 31, 2006 to October 31, 2007   $350,000,000
aggregate limit (to
be confirmed)   $500,000 PD (to be
confirmed)
 
                   
General Liability, products, excess Employers Liability, Contingent and Non
Owned auto Liability
  Third party personal injury and properly damage liability for occurrences.  
Emirates Insurance Company (local) Supported by reinsurance of Zurich Global Ins
Co   Augusy 20, 2006 to August 20, 2007   General Liability: $50,000,000 per
occurrence and annual aggregate   $10,000 per occurrence property damage and
bodily injury liability
 
                   
Third party
Liability
  Insures Taweelah A2 Operating Co. for liability lor operations not part of the
Taweelah Project   Emirates Insurance Co.   Dec 16, 2006 to Dec 16, 2007  
$1,000,000   NA
 
                   
Office Combined
Multicover Package
  Insures Taweelah for leased office location includes contents, money, and
third party liability coverage   Emirates Insurance Co.   Dec 16, 2006 to Dec
16, 2007   Oil 150,000 contents and fixtures $1,000,000 Third Party Liability
Limit   NA
 
                   
Automobile Liability and Physical Damage
  Liability insurance
for local UAE motor
vehicles   Emirates Insurance Co.   Dec 16, 2006 to Dec 16, 2007   Statutory
Limits in UAE plus damage to vehicles   NA
 
                   
Workers Compensation for Taweelah and Taweelah A2 Operating Co,
  Statutory Insurance
coverage in UAE   Emirates Insurance Co.   Dec 16, 2006 to Dec 16, 2007  
$1,000,000 based on
Statutory limits in
accordance with
worker laws in UAE   NA
 
                   
Fidelity Guarantee
Policy
  Covers employer for
employee (hell   Emirates Insurance Co.   Dec 16, 2006 lo Dec
16, 2007   $1,750,000 or as
scheduled per
employee   None
 
                   
Householder
Comprehensive
  Covers
company-owned home
furnishings in apts
occupied by
employees in UAE   Emirates Insurance
Co   Dec 16, 2006 to Dec 16, 2007   NA   NA

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6. Shuweihat Project

                          Policy   Coverage   Insurer   Terra   Limit of
Liability   Deductibles
 
                       
Property Damage and Business Interruption Package Policy
  Insures Shuweihat against damage to plant properly and equipment and resulting
business interruption from all risk perils and boiler and machinery breakdown  
Fronted by: Al Ain Ahlia Insurance Co. Main re insurers: ACE and Zurich  
Renewal: l’1 November 1, 2006 to November 1, 2007   5400,000,000 Shared
Facilities
Limit 595,000,000 (no Bl)   Property All Risks (excluding shared Facilities):
• $500,000 each and every Occurrence due to natural hazards
§ $1,000,000 each & every Occurrence re machinery breakdown of Gas Turbines
> $500,000 each & every Occurrence re all other machinery breakdown
« $250,000 each & every Occurrence re all other losses
Business Interruption 24 Mo ndemnily period (excluding Shared Facilities):
• 30 days one or a series of Occurrences, except
• 45 days machinery breakdown of Desalination Plan!
· 60 Days machinery breakdown of: Gas
Turbine Generators, Sleam Turbine Generators, Heat Recovery Steam Generators and
main transformer
Shared Facilities insurance covers only Property All Risks and has a deductible
of $250,000
each and every Occurrence
 
                       
Terrorism
Insurance
  Insurers against acts of terrorism for damage to property and business
interruption   Fronted by: Al
Ain Ahlia
Insurance Co,   Renewal: November 1, 2006 to November 1, 2007   5100,000,000  
Terrorism; $250,000 property damage; 30 days Bl
 
                       
General
Liability
  Third party
personal injury and property damage liability for occurrences.   Fronted by: Al
Ain Ahlia Insurance Co. Main re insurers: ACE and Zurich   Renewal: November 1,
2006 lo November 1, 2007   $50,000,000   Public, Products &. Pollution Liability
Reinsurance: $10,000 each and every occurrence
 
                       
Automobile Liability and Physical Dajriage
  Liability
insurance for
local Abu Dhabi
law                   All vehicles are leased and fully comprehensive insurance
is provided through the leasing company
 
                       
Workers
Compensation
And Employers
Liability
  Statutory
Insurance
coverage in Abu
Dhabi   Fronted by: Al Ain Ahlia Insurance Co.   April, 1, 2006 to April 1,2007
  $ 1,000,000      
 
                       
Fidelity
Guarantee
Insurance
  none                    

Section 3.15(b) Insurance
None.
Section 3.15(c) Insurance
None.

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Section 3.15(d) Insurance
1. A preliminary claim submission was sent by Jubail to insurers advising them
of the costs to repair and subsequent business interruption loss from a turbine
fouling accident in April, 2006. The insurers have partially investigated the
incident and prepared preliminary loss reports. At this time no coverage
determination has been provided by the insurer to Jubail. Total expenses for the
draft claim are $13,247,210 net after deductible for property damage and
$1,335,437 net after deductible for business interruption.
2. A notice of loss and potential insurance claim was mailed to insurers on
January 17, 2007 for damage to the Unit U12 Fuel Gas Compressor impeller blades
and cooling tubes. The estimated gross business interruption loss referred to in
the notice is $700,000 for the seven month estimated time to replace the
compressor impeller subject to a sixty day deductible. A warranty claim was
denied by Siemens and the supplier for the repair of the compressor impeller and
the cooling tubes. The estimated cost to repair the compressor impeller is
$144,728 plus additional installation and shipping. That claim for physical
damage loss will likely not exceed the $1,000,000 insurance policy deductible.
Section 3.18(a) Absence of Certain Changes
1. Neyveli. There is an ongoing dispute between Neyveli and TNEB regarding the
capital costs to be reflected in the tariff paid by TNEB to Neyveli. Neyveli
filed a petition with the Madras High Court in India in May, 2006 seeking
injunctive relief to prevent TNEB from reducing its tariff payments until the
dispute is resolved pursuant to the dispute resolution provisions in the power
purchase agreement, which provides for arbitration in London under the Rules of
Arbitration of the International Chamber of Commerce. Neyveli filed a Request
for Arbitration under the (English) Arbitration Act, 1996 in relation to this
matter before the ICC Court of Arbitration, ICC, Paris on November 6, 2006. TNEB
has taken the position that under the Power Purchase Agreement and Indian law
the actual capital costs are to be determined by the Tamil Nadu Electricity
regulatory Commission and has submitted to ICC that ICC did not have the
jurisdiction to take up arbitration proceedings. TNEB also filed an application
in the Queens Court in London on 20 December 2006 seeking a stay on the ICC
arbitration.
2. Neyveli: Neyveli has filed a petition with the Railway Rates Tribunal
(RRT) against its decision to increase the chargeable weight from 48.5 tonnes to
58.5 tonnes and subsequently to 60 tonnes. Final arguments are taking place and
it is expected that it would take another six months for the completion of the
case and for RRT to pass orders. Should Neyveli prevail, it will lead to
reduction of freight charges and consequent benefit to TNEB.
3. Neyveli: Neyveli Lignite Company has claimed electricity consumption tax for
the years 2003-04 (Rs.8.4 mn of which Rs.7.1 mn was paid by Neyveli under
protest) and for 2004-05 (Rs.3,8 mn). These claims have been disputed by
Neyveli, and arbitration is in progress. Neyveli has informed TNEB that it is
disputing this levy, but that if the outcome of the dispute resolution process
is adverse, then the levy will be passed through to TNEB.
4. Jorf: A Complaint was filed in the United States District Court for the
Western District of Pennsylvania to enforce the arbitration award against AMCI
Export Coiporation. Two of the defendant’s bank accounts in Pittsburg,
Pennsylvania and two of the defendant’s bank accounts in New York, New York have
been attached, although no funds were present in the first two, with information
on the second two due shortly. A related Complaint was filed in the United
Slates District Court for the Western District of Pennsylvania on Friday,
October 13, 2006, on behalf of Jorf against Xcoal Energy & Resources, Xcoal
Energy & Resources LLC, American Metals & Coal International, Inc., K-M
Investment Corporation, Ernie Thrasher, Hans J. Mendc, and Fritz R, Kundrun for
damages in the amount of approximately $7,900,000 for claims arising out of AMCI
Export Corporation’s breach of the Coal Supply Agreement dated October 4, 2004

46

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between Jorf and AMCI Export Corporation. This action relates largely to the
believed looting of the assets of AMCI Export Corporation by these defendants
and is presently in the discovery phase with all of the defendants having filed
answers to the Complaint and none having moved for dismissal, in a related
matter, a Complaint was filed in the Circuit Court of the 11th Judicial District
in and for Miami-Dade County, Florida on November 16, 2006 on behalf of Jorf
against Ernie Thrasher for judgment in the amount of 53,300,000 and an equitable
lien in this amount on property Jorf alleges Thrasher purchased with funds
fraudulently transferred from AMCI Export Corporation. Jorf is currently
responding to motions to strike certain allegations (although Thrasher’s answer
to the Complaint did not attempt to dismiss any claim in full), following which
the discovery phase will commence.
5. In connection with the Reorganization, Generation transferred the following
promissory notes to Seller pursuant to an Assignment dated February 2, 2007:
a) Promissory Note dated December 13, 1995 in the principal amount of $1,325,000
given by Genesee Power Station Limited Partnership (“GFSLP”);
b) Promissory Note dated December 31,1995 in the principal amount of $846,000
given by GPSLP.
6. See matters identified in Section 3.9 and Section 3.13.
7. Sec matters identified in Section 5.1(a) and (b).
Section 3.18(b) Absence of Certain Changes
1. Sec matters identified in Section 3.6(a), Section 3.6(b), Section 3.6(c),
Section 3.7, Section 3.9 and Section 3.13.
2. The Government of Ghana and VRA have indicated to Generation that they are
focusing the country’s near term efforts on procuring short term power solutions
as a priority matter. The Government has conveyed its continued interest in
completing the Takoradi expansion and intention of pursuing the project
expeditiously as part of Ghana’s long term power plan following the resolution
of the country’s short term capacity needs.
3. In 2006, as a result of a change in international accounting applicable to
Saudi Arabia, the Jubail power purchase agreement must be shown for accounting
purposes as a financial lease. Although not certain, there is a good possibility
that such financial lease accounting will have to be followed for Saudi tax
purposes resulting in an elimination of fixed assets for tax purposes and
therefore a higher annual Zakat liability. The proposed tax treatment for 2006
is still being studied. If financial lease accounting is followed, Generation
estimates its annual share of Zakat for Jubail at between $1,500,000 and
$2,000,000 annually.
4. At the request of the Moroccan Government, officials of the Moroccan
Government and the Swedish Ministry of Finance have met to discuss possible
changes to the tax treaty between Morocco and Sweden.
5. Shuweihat was recently informed by the Siemens that certain inspections
needed to be carried out to determine if a product enhancement/modernization was
required for the Siemens provided generators. During the normal winter outage
cycles, now in progress, the requested inspections were carried out on three
different generators, and it appears the enhancement/ modernization is in fact
required on these three machines. As Shuweihat’s allowed outage season is nearly
at an end, Shuweihat initially assumed the enhancement/ modernization work could
be carried during the next scheduled outage cycle and that the other generators
could be inspected during that period as well. Siemens is now saying the
enhancement/modernization is more critical. If this work is required to be done
before the next outage cycle, it could impact Shuweihat’s availability thus
adding extra costs above and beyond any actual generator work. This issue is
still unclear, and is being followed up by Shuweihat management.

47

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See Attachment A
Section 3.18(c) Absence of Certain Changes
Section 3.19 Absence of Undisclosed Liabilities
None,
Section 3.21 Affiliated Transactions’

                          Loans, between:   Balance 01/31/07   (1 )  
CMS Enterprises International LLC (Holder) and Energy (Borrower)
  $ 53,763,652     00    
Generation (Holder) and Energy (Borrower)
    28,318,259   (iii)  
CMS Enterprises International LLC (Holder) and CMS Capital (Borrower)
    211,339,101   (iv)  
CMS Enterprises Investment Co 1 (Holdcr)and Atacama Finance (Borrower)
    26,099,868     (v )  
CMS Generation (Holder) and Hidroinvest (Borrower)
    19,480,490   (vi)  
Jcgurupadu O & M Company (Holder) and CMS Enterprises Investment Co I (Borrower)
    2,763,870   (vii)  
Jegurupadu O&M Company (Holder) and CMS International Operating Co (Borrower)
    1,280,713   (viii)  
Jegurupadu CMS Generation (Holder) and CMS Generational Investment Co. VI
(Borrower)
    9,819,584   (IX)  
Cuyana S.A. De lnversiones (Holder) and CMS Generation Investment Co VI
(Borrower)
    12,484,339     (x )  
CMS Gas Argentina (Holder) and CMS Enterprises Investment Co I (Borrower)
    1,026,333   (xi)  
CMS Generation Investment Company VI (Holder) and CMS Distribuidora (Borrower)
    8,200,000 *

 

*   Repaid in lull February 24, 2006.

2. Intercompany Cash Pooling Arrangement (as between Generation, Subsidiaries of
Generation and CMS Capital LLC):
CMS Generation and its Subsidiaries Asset/(Liability) as of January 31, 2007
(i) CMS Capital LLC owes to:
(a) CMSG Investment Company III $22,894
(b) Generation 23,324,829
(c) Taweelah A2 Operating Company 4,692,264
(ii) CMS Enterprises Internationa] LLC owes to:
CMS to provide updated information through end tit” 2006.

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2. Intercompany Cash Pooling Arrangement (as between Generation, Subsidiaries of
Generation and CMS Capital LLC):
CMS Generation and its Subsidiaries Asset/(Liability) as of January 31, 2007
(a) CMS Capital LLC $ (5,579,231)
TOTAL INTERCOMPANY CASH POOL BALANCE $22,460,756
3. Amended and Restated Agreement for the Allocation of Income Tax Liabilities
and Benefits, as of January 1, 1994, between Energy and its consolidated
(domestic) subsidiaries.
4. Grayling Generating Station Limited Partnership Agreement among CMS
Generation Grayling Company, CMS Generation Grayling Holdings Company and
Grayling Development Partners and Generation as to a guaranty thereunder.
5. Guarantee by Seller of the obligations of CMS Morocco Operating Company
S.C.A. under the Operations and Maintenance Agreement for the Jorf project.
6. Secondment Agreement between CMS Resources Development Company and Jorf.

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Section 5.1 (a) Conduct of Business
See matters identified in Section 5.1(b).
A. Jubail:
1. Generation may take such actions as may be necessary or desirable to document
settlement of the dispute with Siemens AG on the terms described in item 1 of
Section 3.9.
2. Generation may take such actions to document the waiver of the project
lenders described as the Jubail item of Section 3.6(b).
3. Generation may take all such actions as may be necessary or desirable to
address the consequences of the extended outage that occurred at Jubail in
April 2006, including negotiations with SADAF regarding replacement power costs
and renegotiation of LTSA; subject to the restrictions set forth in Section 5.1
(b) of the Agreement.
B. Prairie State Project:
1. Assignment of various agreements entered into by Generation with respect to
the Prairie State Project to one or more Affiliates of Energy.
2. Substitution of an Affiliate of Energy for Generation under those certain
Term Sheets delivered in connection with CMS Prairie State, LLC’s investment in
Lively Grove and the Prairie State Project.
C. Neyveli:
1. Generation will take such actions that it deems necessary or desirable in
connection with the resolution of the Neyveli matters referenced in
Sections 3.6(c), 3.8, 3.9, 3.13, and 3.14(c), subject to the restrictions set
forth in Section 5.1 (b) of the Agreement.
2. Generation will take such actions as it deems necessary or desirable in
connection with the resolution of the Neyveli matter referenced in Section 3.18,
subject to Buyer’s right to consent to any settlement.
3. Generation will take such actions that it deems necessary or desirable in
connection with the prospective divestiture of ABB’s interest in Neyveli,
subject to the restrictions set forth in Section 5.1 (b) of the Agreement and
consistent with the Consent and Support Agreement.
D. Takoradi Opportunities:
1. Ongoing Activities
a) Takoradi may continue to negotiate, finalize, and put into place the site
lease in conformance in all material respects with the drafts of such site lease
and related side letter dated_December, 2006 and provided to Buyer on
lntralinks.
b) Takoradi may continue to pursue the application and put into place the
permanent generation license for the two existing combustion turbines.
c) Takoradi may continue to negotiate, finalize, and put into place the
documentation for the conversion of the combustion turbines to allow firing on
natural gas, including the on-shore and off-shore contracts with affiliate of
General Electric in conformance in all material respects with the draft of such
documents dated December __, 2006 and provided to Buyer on lntralinks. Takoradi
may continue to negotiate and discuss with affiliates of General Electric an
amended and restated long term service agreements relating to major maintenance
of the combustion turbines following their conversion to gas-firing, including
both an on-shore and an off-shore agreement, subject to the restrictions set
forth in Section 5.1(b) of the Agreement.
d) Generation may continue to negotiate, finalize, and put into place the
documentation for correction of the matter described as Takoradi item 1 in
Section 3.6(b), Takoradi item 1 in Section 3.6(c) in conformance in all material
respects with the draft of the shareholder resolution dated November, 2006 and
provided to Buyer on lntralinks.
e) Takoradi may discuss with VRA and the Government of Ghana possible amendments
to the project documents to, among other things, reflect the

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conversion of the T2 project to gas firing capability, subject to the
restrictions set forth in Section 5.1(b) of the Agreement.
2. Modification, Expansion, and Financing
Takoradi and Generation may continue negotiations and discussion with VRA, the
Government of Ghana, the prospective EPC consortium, the prospective project
lenders, and other third parties relating to the expansion of the existing
project from approximately 220 megawatts to approximately 330 megawatts, subject
to the restrictions set forth in Section 5.1(b) of the Agreement.
Jorf:
1. Discussions ongoing with ONE regarding the potential development,
construction, and operation of additional power generating units at the Jorf
site, subject to the restrictions set forth in Section 5.1(b) of the Agreement.
2. Generation will take such actions that it deems necessary or desirable in
connection with the prospective divestiture of ABB’s interest in Jorf, subject
to the restrictions set forth in Section 5.1(b) of the Agreement and consistent
with the Consent and Support Agreement.
Other:
1. Nothing in the Agreement restricts any activities taken with respect to the
development projects that will be transferred to Seller or one of its affiliates
(other than Generation or its Subsidiaries) at or prior to the closing.
2. Generation may continue with activities relating to a possible bid for the
Cap Ghir project proposed for Morocco, subject to the restrictions set forth in
Section 5.1(b) of the Agreement.
3. Generation may take all actions to obtain necessary consents from third
parties in order to assign its obligations described in items 11 and 12 under
“Other” of Part A in Section 3.6(d).
Section 5.1(b) Conduct of Business
Section 5.1(b)(i)-(iii)
1. Compliance with requirements under the Jorf Partnership Agreement, Company
Loan Agreement, and By-Laws relating to potential conversion of Company Loans
and Class C shares of convertible preferred stock into Jorf common stock (and
associated obligations to amend Jorf organizational documents in order to effect
such conversions)
Section 5.l(b)(x)
1. Holder (as defined below) will assign its rights and obligations under the
following promissory notes to Seller:
a) CMS Enterprises Investment Co. I (Holder) and Atacama Finance (Borrower)
526,099,868 balance at 12/31/06
Section 5.1 (b)(xi)
1. See matter identified in item 1(c) of Part D in Section 5.1(a).
Section 5. l(b)(xx) and (xxiii)
2. Employees at Jorf are eligible forborne mortgage loans and automobile loans.
Employee loans have a defined maximum amount and are at a government approved
interest rate. All loans are guaranteed by Jorf. Employees repay the loans
through payroll deduction.
Section 5.4(a) Certain Subsidiary Debt Level
Indebtedness of CMS Generation Investment Company IV provided for in the CGIC
Loan Agreement.

51

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Section 5.41b) Certain Subsidiary Debt Level
Indebtedness provided for in (i) the Eximbank Credit Agreement with the
Export-Import Bank of the United States dated as of September 4, 1997, (ii) the
Finance Agreement with the Overseas Private Investment Corporation dated as of
September 4, 1997, (hi) the World Bank Facility Agreement dated as of
September 4, 1997, (iv) the SACE Facility Agreement dated as of September 4,
1997, (v) the ERG Facility Agreement dated as of September 4, 1997, and
(vi) related interest rate, risk guaranty, and other agreements.
Section 5.6(a) Employee Matters
See Attachment A.

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Section 5.7(j) Tax Covenants
1. CMS Enterprises Investment Company I
2. CMS Generation Investment Company IV
3. CMS Generation Luxembourg S.A.R.L.
4. CMS Generation Investment Company II
5. CMS Generation Netherlands B.V.
6. CMS Generation Jorf Lasfar I Limited Duration Company
7. CMS Generation Jorf Lasfar II Limited Duration Company
S. Jorf Lasfar Power Energy Aktiebolag
9. Jorf Lasfar Energi Aktiebolag
10. Jorf Lasfar Handelsboiag
11. Jorf Lasfar I Handelsboiag
12. Jorf Lasfar Power Energy Handelsboiag
13. CMS Generation Investment Company VI
14. CMS Takoradi Investment Company
15. CMS Takoradi Investment Company II
16. Takoradi International Company
17. CMS Generation Investment Company VII
18. CMS Generation Taweelah Limited
19. CMS Energy UK Limited
20. CMS International Operating Company
21. CMS Generation UK Operating Private Limited
22. CMS Generation Jorf Lasfar III Limited Duration Company
23. Jorf Lasfar Aktiebolag
24, Jorf Lasfar Operations Handelsbolag
25. CMS Morocco Operating Co., S.C.A.
Section 5.8 Intercompany Accounts
None.
Section 5.12 Certain Transactions
1. Discussions between ABB and Buyer or its Affiliates relating to the possible
acquisition by Buyer of ABB’s interest in Jorf and Neyveli and related matters.

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Section 5.13(c) Use of Corporate Name; Transitional Use of Seller’s Name
1. CMS Energy logo
2. CMS Energy Corporation
3. CMS Energy
4. CMS Enterprises
5. CMS Enterprises Company
6. CMS Generation Co.

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Section 5.14 Guarantees
Letters of Credit/Guarantees:

                      Current       Minimum Required     Approximate      
Rating or Emily   Amount ($ Mn)   Beneficiary   Qualification
1. LETTERS OF CREDIT
               
(ii) Energy
               
Shuweihat Debt Service Reserve LC
    13.0     Barclays Bank Pie   (a)
Jubaii
    2.0     Banque Saudi Fransi   (b)
Jorf Lasfar Fuel LC
    3,0     Deutsche Bank Trust Co Americas   (c)
Jorf Lasfar Super Reserve LC
    10 0     Deutsche Bank Trust Co. Americas   to
Jorf Lasfar $ Denominated DSRA LC
    o.7     Deutsche Dank Trusi Co Americas   (c)
jorf Lasfar Euro Denominated DSRA LC
    16.7 (d)   Deutsche Bank Trusi Co. Americas   Ce)
Jorf Lasfar Fixed O&M Reserve
    4 8     Deutsche Bank Trust Co Americas   (c)
Jorf Uslar Major Maintenance Reserve
    51!     Deutsche Bank Trust Co Americas   &  
Sub Total (Lcltcrs ol’Credit)
    64.2          
11. GUARANTY
               
(a) Hnerpv
               
Jorf Lasfni Fuel Termination
    50     Deutsche Bank Trust Co Americas    
Joif Lasfar Change m Law Contribution
    20 3     Deutsche Bank Trust Co. Americas   (c)
“taweelah A2 Debt Service Reserve
    12.0     ADWEA    
CMS Generation Invest Co. IV*
    106.2     Barclays Bank Pie   (e)
(b) Seller
               
CMS Morocco Operating Company
    45.0     Jorf Lasfar Energy Company   (ej  
 
               
Sub Total (Guaranty) 188.5
               
Total (I+ 11) _ _ 252.7
               

 

*   Energy guaranty of $53,588,000 loan plus Euro 40,000,000 loan.

Notes
 

(a)   A bank which (1) is a credit institution or financial institution (2) has
its registered head office situated in a member state of the Organization for
Economic Cooperation and Development, and (3) has a credit rating for long term
debt of A or better by Standard and Poor’s or an equivalent rating from another
rating agency acceptable to the majority banks.   (b)   A bank which maintains a
long term unsecured debt rating of “A-” by Standard and Poor’s and “A3” by
Moody’s;   (c)   Any bank of financial institution (1) organized under the laws
of any member country of the Organization for Economic Cooperation and
Development, (2) which has a combined capital and surplus at least equal to
$500,000,000, (3) whose unsecured long-term indebtedness is rated no less than A
by Standard an Poor’s or A2 by Moody’s.   (d)   The actual amount of this letter
of credit is 12,800,000 Euros.   (e)   Any transferee must be a direct or
indirect subsidiary of an entity with a long term unsecured debt credit rating
of at least BBB by Standard and Poors or Baa2 by Moodys.

Section 5.15 Reorganization
See Attachment A,
Section 5.16 Merger and Redomiciliation
See Attachment A.

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Section 6.3(d) Seller’s Conditions to the Closing
Governmental Consents:
1. Approval of one or more Moroccan governmental entities may be required for
the matters provided for in Section 5.4 of the Agreement.
Jorf Consents9:
1. Consent of the Jorf project lenders and/or ABB is required, including:
a) Consent pursuant to 6.13(a)(z) of the Common Agreement for a transfer of
ownership interests in Jorf;
b) Waiver pursuant to Section 6.13(b) of the Common Agreement that prohibits a
general partner of Jorf from making any direct or indirect disposition of its
interest in Jorf;
c) Consent pursuant to Section 6.9(f) of the Common Agreement which prohibits
Jorf from entering into or permitting the assignment by Energy of its
obligations under the CMS Capital Contribution Agreements;
d) Waiver of Section 5.11 of the Common Agreement which requires that the CMS
Capital Contribution Guarantee by Energy be kept in full force and effect;
e) Waiver of Section 7.9(a) of the Common Agreement, which makes it an event of
default if any transaction document ceases to be in full force and effect;
f) Consent pursuant to Section 8.05(b) of each of the CMS Capital Contribution
Agreements, which prohibit the assignment of the obligations thereunder;
9Consents and approvals by the Jorf senior lenders will not be required if the
senior loans will be refinanced with funds provided from or arranged by Buyer
prior to the Closing Date.
g) Waiver of Section 6.13(a)(i) of the Common Agreement which requires that
there be not less than 25% beneficial US ownership of Jorf;
h) Consent for replacement of Energy guaranties; and
i) Consent for replacement of Seller’s guaranty of CMS Morocco Operating
Company’s obligations under the Operations and Maintenance Agreement with Jorf.
2. Consent of ONE may be required under Section 9.3 of Jorf Power Purchase
Agreement as result of O&M operator not being an affiliate of CMS Generation
Co., a Michigan corporation.
3. Implied consent of Jorf is required.10
Takoradi Consents;
1. Consent of Takoradi Power Company (Ghana) Limited under the Takoradi
Shareholders Agreement.
Taweeiah Consents:
1. Majority shareholder consent required for change in control and Energy
guaranty needs to be replaced.
2. Project lender consent if Buyer does not meet the criteria for a “Qualifying
Investor” as such term is defined in the Taweeiah financing documents.
3. Consent of ADWEA necessary for the assignment by Energy of its indemnity
obligation to ADWEA supporting the debt service reserve letter of credit.
4. Consent of Siemens AG under the Long Term Service Agreements.
10Under the Partnership Agreement of Jorf, this would require the consent of
some or all of the ABB partners.

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Neyveli Consents:
1. Consent of Neyveli is required to convert Generation to LLC pursuant to the
Neyveli Operations and Maintenance Guaranty.”
Prairie State Project:
1. The consents set forth in Section 3.4 of this Seller Disclosure Letter with
respect to the Prairie State Project.
Other Consents:
1. Replacement of $100,000 bond with City of Flint backed by Generation (MMR).
2. Replacement of $675,000 bond with Connecticut EPA backed by Generation
(Exeter).
3. Pursuant to the Reimbursement and Credit Agreement for the Partnership
project the consent of the Agent and the Majority Lenders will be required to
amend or waive a provision regarding the continuing ownership interest of
Generation in the Partnership. Consent of the partners to the Partnership
Agreement will be needed to replace Generation as guarantor.
4. Consent of lenders under the CMS Energy Sixth Amended and Restated Secured
Credit Facility with respect lo release of Liens and sale of assets.
5. Waiver/Consent under the Bank of America Reimbursement Agreement as to
transfer of ownership of CMS Interests.
6. Consent of lenders under the CG1C Credit Agreement as to (i) the Change in
Control of CMS Generation Investment Company IV, (ii) the replacement of Energy
as Guarantor of the obligations of CMS Generation Investment Company IV under
the CGIC Credit Agreement, (hi) the incurrence by Jorf of new or replacement
indebtedness and the terms thereof or any changes to the existing Jorf senior
debt financing or project documents, (iv) the prepayment by Jorf of its senior
debt with funding provided from or arranged by the Buyer, (v) and changes
11Under the Shareholders Agreement of Neyveli, this would require the consent of
the ABB shareholder.
to or replacement of existing, or granting of new, consents, approvals, and
waivers from any Moroccan governmental authorities.12
12Approvals by these lenders will not be required because the loan will be
refinanced with funds provided from or arranged by Buyer prior to the Closing
Date.

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Section 8.2(a)(iv) Indemnification
1. Toledo Power Co.: CMS Generation Investment Company 1 sold its portion of
Toledo Power Company and associated businesses to Mirant Toledo Holdings Inc.,
now known as Mirant Global Corporation (“Mirant”) on April 18, 2002. Under the
share purchase agreement, CMS Generation Investment Company I retained certain
tax liabilities for TY 2002, with all of such liabilities supported by a
guaranty from Generation. On or about July 12, 2004, Mirant requested
indemnification for a Branch Profit Remittance Tax for 2002 in the amount of
P6,351,829 (approximately $115,000 at the time) assessed by the Philippine
Bureau of Internal Revenue (“B1R”). SGV, Generation’s former Philippine
accountants on the project, was retained to negotiate with the BIR to resolve
the issue. SGV has proposed a settlement with the BIR for P2,052,000
(approximately 540,000). At last check, several months ago, the compromise
application was pending before the Management Committee of the BIR for review
and final approval. The application was referred to this committee after review
by the Technical Working Group of the Collection Enforcement Division of the BIR
evaluated the application for compromise and, in the words of the SGV letter,
“found it meritorious”. SGV is speaking informally with members of the
Management Committee to help garner its support since a majority of the members
are needed to accept the proposal.
2. Seller will indemnify Buyer for liabilities arising in connection with the
Share Sale Agreement dated 3 July, 2003 among Generation, CMS Generation
Investment Company J, CMS Generation Loy Yang Holdings 1 Ltd, CMS Generation Loy
Yang Holdings 2 Ltd, NRGenerating B.V. No. 4, Horizon Energy Investment Limited,
GEAC Operations Pty Ltd, and Great Energy Alliance Corporation Pty Ltd, as
amended by a Deed of Amendment dated 2 September 2003, a Second Deed of
Amendment dated 19 December 2003, a Third Deed of Amendment dated 8
January 2004, a Fourth Deed of Amendment dated February 12, 2004, and a Fifth
Deed of Amendment dated March 2004.
3. Seller will indemnify Buyer for liabilities arising in connection with the
Sale and Purchase Agreement dated 18 April 2002 among Mirant Toledo Holdings
Corporation, A. Soriano Corporation, CMS Generation Investment Company 1, and
Generation.
4. Seller will indemnify Buyer for liabilities arising in connection with the
Securities Purchase Agreement dated December 31, 2003 between CMS Energy
Investment LLC, Generation, and UASGP LLC.
5. Seller will indemnify Buyer for liabilities arising in connection with the
Contribution Agreement dated December 31, 2003 between Generation and CMS Energy
Investment LLC.
6, Seller will indemnify Buyer for liabilities arising in connection with the
Amended and Restated Limited Partnership Agreement dated as of January I, 1992,
between CMS Grayling GI\ CMS Grayling LP and Grayling Development Partners,
which includes a guaranty by Generation of certain obligations of CMS Grayling
GP and CMS Grayling LP.

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Section 8.2(a)(v) Indemnification
Takoradi:
1. Under the Takoradi International Company Shareholders Agreement, the
shareholders failed to cause additional shares of Class C Shares in Takoradi
International Company to be issued as required under the terms of the
Shareholders Agreement as they made certain additional capital contributions.
Despite their failure to cause these issuances and the resulting recordation in
the share register of Takoradi International Company, the shareholders have
caused Takoradi International Company distributions and other economic benefits
and liabilities to be allocated on a basis other than their formally recorded
shareholding percentages and substantially in accordance with their respective
interests as if such additional shares had been issued and recorded as required
under the terms of the Shareholders Agreement. Both shareholders are now aware
of this matter, and corrective action has been initiated by the shareholders but
has not been completed as of February 2, 2007. Seller’s indemnification
obligations will be limited to any Damages suffered by the Buyer Indemnified
Parties during the Special Indemnity Period as a result of Takoradi
International Company failing to issue the number of shares to CMS Takoradi
Investment Company II required to be issued pursuant to the provisions of the
Takoradi Shareholders Agreement or failure to make distributions to CMS Takoradi
Investment Company II on a basis consistent with such ownership level.
2. The Takoradi plant is currently being operated without a permanent generating
license from the Ghanaian Energy Commission. A temporary license has been issued
and is effective until 31 March 2007 pending issuance of the permanent
generation license, the application for which is pending. Seller’s
indemnification obligations will be limited to any Damages suffered by the Buyer
Indemnified Parties during the Special Indemnity Period as a result of Takoradi
being prohibited from operating its facilities as a result of the Ghanaian
Energy Commission failing to issue such permanent generating license, and shall
be subject to Buyer using its reasonable best efforts to cause Takoradi to take
all actions necessary to have such permanent generating license issued by the
Ghanaian Energy Commission as soon as reasonably practicable.
3. Pursuant to the Takoradi Power Purchase Agreement, the VRA granted to
Takoradi the unrestricted and exclusive access to, and quiet enjoyment of, the
Site (as such term is defined in the Power Purchase Agreement) for purposes of
constructing the Takoradi project. In addition, both Takoradi and the VRA agreed
in the Power Purchase Agreement to endeavor to enter into a site lease for the
Site within 30 days after execution of the Power Purchase Agreement and on the
commercial terms specified in the Power Purchase Agreement, following which the
contractual right of use to the Site under the Power Purchase Agreement

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would terminate. As of February 2, 2007, Takoradi and the VRA have not entered
into a site lease. A portion of the Takoradi project was also built outside of
the boundaries of the Site described in the Power Purchase Agreement. Takoradi
and the VRA arc aware of the boundary discrepancy and continue to engage in good
faith discussions with regard to a site lease that would correct this potential
defect as well as satisfy the Power Purchase Agreement for a site lease to
replace the right of use grant in the Power Purchase Agreement, Seller’s
indemnification obligations will be limited to any Damages suffered by the Buyer
Indemnified Parties during the Special Indemnity Period as a result of Takoradi
being prohibited from operating its facilities as a result of its failure to
have an executed site lease or agreement or comparable contractual right to use
of the site on which the Takoradi was constructed and shall be subject to Buyer
using its reasonable best efforts to cause Takoradi to take all actions
necessary to negotiate in good faith and enter into such site lease or agreement
or contractual right as soon as reasonably practicable.
Neyveli:
1, There is an ongoing dispute between Neyveli and TNEB regarding the capital
costs to be reflected in the tariff paid by TNEB to Neyveli. Neyveli filed a
petition with the Madras High Court in India in May, 2006 seeking injunctive
relief to prevent TNEB from reducing its tariff payments until the dispute is
resolved pursuant to the dispute resolution provisions in the power purchase
agreement, which provides for arbitration in London under the Rules of
Arbitration of the International Chamber of Commerce. Neyveli, on November 6,
2006, filed a Request for Arbitration under the (English) Arbitration Act of
1996 in relation to this matter before the ICC Court of Arbitration. TNEB has
taken the position that under the Power Purchase Agreement and Indian law the
actual capital costs are to be determined by the Tamil Nadu Electricity
regulatory Commission and has submitted to ICC that ICC did not have the
jurisdiction to take up arbitration proceedings. TNEB also filed an application
in the Queens Court in London on 20 December 2006 seeking a stay on the ICC
arbitration. Seller’s indemnification obligations to the Buyer Indemnified
Parties will be limited to any Damages (limited to those Damages attributable to
periods prior to the Closing Date) that are awarded to TNEB as a result of such
arbitration, or that are agreed to be paid to TNEB pursuant to a settlement
agreement in each case during the Special Indemnity Period, provided that such
settlement agreement is consented to by Seller, whose consent shall not be
unreasonably withheld or delayed. Buyer shall continue to pursue such
arbitration in good faith.
CORPORATE VERSION OF ACTION STEPS CARVE OUT OF THE AMERICAS ASSETS Last Revised:
October 5, 2006

             
Action Step
  Entity Interest Directly Affected (Domicile) (% Ownership by Transferor)  
Subsidiary Entiry/Entin’es Interest(s) Indirectly Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes
 
            Step 1: Transfer CMS Land out of CMS Enterprises.
 
           
1. CMS Enterprises Company (MI) dividends CMS Land Company (MI) to CMS Energy
Corporation (MI)
  CMS Land Company (MI) (100%)   Beeland Group LLC (MI) (100%)   Note: Consents
drafted; effective 10/10/06. DIG or DIL not triggered by sale to Taqa
 
            Step 2: Transfer two MCVsheti entities out of CMS Generation.
 
           
2. CMS Generation Co. (MI) dividends its interests in MCV2 Development Company
(Ml) and Midland Cogeneration Venture Expansion, LLC (DE) to CMS Enterprises
Company (MI)
  MCV2 Development Company (MI) (58.68%)
Midland Cogeneration Venture Expansion, LLC (DE) (50%)   None   Note: Consents
drafted; effective 10/10/06. DIG or DIL not triggered by sale to Taqa
 
            Step S: Convert CMS Generation to Michigan LLC.
 
           
3. Convert CMS Generation Co. (MI) to CMS Generation LLC (MI)
  CMS Generation Co (MI)   CMS (India) Operations & Maintenance Company Private
Limited (India) (1%)
CMS Centrales Termicas S.A. (Argentina) (99%)
CMS Enterprises International LLC (MI) (100%)
CMS Exeter LLC (MI) (100%)’
CMS Generation Filer City Operating LLC (MI) (100%)
CMS Generation Filer City, Inc. (MI) (100%)
CMS Generation Genesee Company (MI) (100%)   Note: Neyveii consent by ST-CMS
Electric Company Pvt. Ltd. required for conversion to LLC, per SIR. Note:
Taweelah A2 Operating Company is a MI corporation. Transfer to LLC? Taxfrce 332
liquidation;

A $675,000 bond with the Connecticut EPA backed by Generation will have to be
replaced.

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Action Step
  Entity Interest Directly Affected (Domicile) (% Ownership by Transferor)  
Subsidiary Entity/Entities Interests) Indirectly Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes

    CMS Generation Grayling Company (MI) (100%)
CMS Generation Grayling Holdings Company (MI) (100%)
CMS Generation Holdings Company (MI) (100%)
CMS Generation Honey Lake Company (MI) (100%)
CMS Generation Investment Company VI (Cayman) (100%)
CMS Generation Investment Company VII (Cayman) (100%)
CMS Generation Michigan Power L.L.C. (MI) (100%)
CMS Generation Operating LLC (MI) (100%)
CMS Generation Recycling Company (MI) (100%)
CMS International Operating Company (Cayman) (100%)
CMS International Ventures, L.L.C. (MI) (21.02%)
CMS Morocco Operating Co., SC. A. (Morocco) (0.1%)
CMS Palermo Energy Company (Nova Scotia) (100%)
CMS Prairie State LLC (MI) (100%)
Dearborn Generation Operating, L.L.C. (MI) (100%)
Exeter Energy Limited Partnership (CT) (50%)
Hidroelectrica E! Chocon S.A. (Argentina) (2.48%)
Honey Lake Energy I L.P. (CA) (1%)
Honey Lake Energy II, L.P. (CA) (1%)
HYDRA-CO Enterprises, Inc. (NY) (100%)
Idaho Wind Generation Company, LLC (DE) (100%)
Lassen Wind Generation LLC (MI) (100%) [Currently in formation)
Oxford Tire Recycling, Inc. (DE) (100%)
Oxford/CMS Development Limited Partnership (MI) (99%)
Servicios de Aguas de Chile CMS y Compania Limitada (Chile) (99.99%)
Taweeiah A2 Operating Company (MI) (100%)   Generation no longer in SBT combined
group

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Action Step
  Entity Interest Directly Affected (Domicile) (% Ownership by Transferor)  
Subsidiary Entity/Entities Interest(s) Indirectly Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes
 
            Step 4: Transfer Jegurupadu entities related to historic Indian
operations to CMS International Ventures.
 
           
4a. CMS Generation Investment Company III (Cayman) transfers its interests in
the Jegurupadu entities related to historic Indian operations to CMS
International Ventures LLC (MI)
  CMS Generation Jegurupadu I Limited Duration Company (Cayman) (99%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)   Nothing for tax
 
           
4a.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (99%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)    
 
           
4a.
  Jegurupadu CMS Generation Company Ltd. (Mauritius) (100%)   None    
 
           
4b. CMS Enterprises Investment Company I (Cayman) transfers its interests in the
Jegurupadu entities related to historic Indian operations to CMS Enterprises
International LLC (Ml)
  CMS Generation Jegurupadu I Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)   De minimis taxable
distribution to Enterprises International LLCn
 
           
4b.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)    
 
           
4c. CMS Enterprises International LLC (MI) transfers its interests in the
Jegurupadu entities related to historic Indian operations to CMS Generation LLC
(MI)
  CMS Generation Jegurupadu I Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)   De minimis taxable
distribution to Enterprises
 
           
4c.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)    

62

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Action Step
  Entity Interest Directly Affected] (Domicile) (% Ownership by Transferor)  
Subsidiary Entity/Entities Interest(s) Indirectly Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes
 
           
4d. CMS Generation LLC (Ml) transfers its interests in the Jegurupadu entities
related to GVK (India) to CMS International Ventures LLC (MI)
  CMS Generation legurupadu 1 Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)    
 
           
4d.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)   Note: After this Step, CIV
will own 100% of Jeg LDC I and 11, and Jeg CMS Generation (and indirectly Jeg
O&M Company Mauritius, held 50/50 by LDC I and II).
 
            Step 5: Transfer CMS Generation Investment Company III (Neyveli) to
CMS Generation.
 
           
5a. CMS International Ventures LLC (MI) transfers its interest in CMS Generation
Investment Company III (Cayman) pro rata to members (CMS Generation LLC (MI),
CMS Gas Transmission Company (MI) and CMS Enterprises Company (MI))
  CMS Generation Investment Company III (Cayman)(100%)   CMS Generation Neyveli
Ltd. (Mauritius) (100%)   Note: Enter agreement with UW re 1.5% distribution.
Taxfree under Section 731
 
           
5b. CMS Gas Transmission Company (MI) transfers its interests in CMS Generation
Investment Company III (Cayman) to CMS Enterprises Company (MI)
  CMS Generation Investment Company III (Cayman) (GT’s pro rata ownership
interests of GIC III)   CMS Generation Neyveli Ltd, (Mauritius) (100%)   DIG or
DIL not triggered bv sale to Taqa
 
           
5c. CMS Enterprises Company (MI) transfers the interests it holds in CMS
Generation Investment Company III (Cayman) to CMS Generation LLC (MI)
  CMS Generation Investment Company III (Cayman) (Enterprises^ pro rata share of
GIC III, plus GT’s pro rata share transferred lo ENT in previous Step)   CMS
Generation Neyveli Ltd. (Mauritius) (100%)   Note: After this Step, CMS
Generation LLC will own 100% of GIC III. Nothing for tax

             
Action Step
  Entity Interest Directly Affected (Domicile) (% Ownership by Transferor)  
Subsidiary Entity/Entities Interests) Indirectly Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes
 
            Step 6: Transfer CMS Generation’s interest in CMS International
Ventures to CMS Enterprises.
 
           
6. CMS Generation LLC (MI) transfers its 21.02% interest in CMS International
Ventures LLC (MI) to CMS Enterprises Company (MI)
  CMS International Ventures LLC (MI) (21.02%)   CMS Electric & Gas, L.L.C. (Ml)
(100%)
CMS Gas Transmission del Sur Company (Cayman) (100%)
CMS Generation Investment Company V (Cayman)(100%)
CMS Generation S.R-L. (Argentina) (100%)
CMS Luxembourg S.a.r.l. (Luxembourg) (100%)
CMS Operating S.R.L. (Argentina) (100%)   Note: Per Jay, no UW approval needed
for this transfer. [SJR checking whether ANEEL consent is required.) Nothing
 
            Step 7: Transfer fPP entities not included in the transaction to
HYDRA-CO.
 
           
7. CMS Generation LLC (MI) transfers its holdings in assets (transfer of direct
and indirect interests) not included in the transaction to HYDRA-CO Enterprises,
Inc. (NY)
  CMS Centrales Termicas S.A. (Argentina) (99%)   Cuyana S.A. de Inversiones
(Argentina) (1 %)   Tax free contributions by Enterprises; Section 362(e)(2)(C)
elections need to be made to preserve inside basis on “loss” assets. Need to
consider requirements to qualify HCE for combined SBT return in place of
Generation
 
           
7.
  CMS Exeter LLC (MI) (100%)   Exeter Energy Limited Partnership (CT) (2%)
Oxford/CMS Development Limited Partnership (MI) (1%)    
 
           
7.
  CMS Generation Filer City Operating LLC (MI) (100%)   None    
 
           
7.
  CMS Generation Filer City, Inc. (MI) (100%)   T.E.S. Filer City Station
Limited Partnership (MI) (50%)    
 
           
7.
  CMS Generation Genesee Company (Ml) (100%)   Genesee Power Station Limited
Partnership (DE)(1%)    

63

--------------------------------------------------------------------------------

 

             
Action Step
  Entity Interest Directly Affected (Domicile) (% Ownership by Transferor)  
Subsidiary Entity/Entities Interest(s) Indirectly Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes
 
           
7.
  CMS Generation Grayling Company (Ml) (100%)   Grayling Generating Station
Limited Partnership (MI) (1%)
Grayling Partners Land Development, L.L.C. (MI) (1%)    
 
           
7.
  CMS Generation Grayling Holdings Company (MI) (100%)   Grayling Generating
Station Limited Partnership (Ml) (49%)
Grayling Partners Land Development, L.L.C. (MI) (49%)    
 
           
7.
  CMS Generation Holdings Company (Ml) (100%)   CMS Centrales Termicas S.A.
(Argentina) (1%)
CMS Comercializadora de Energia S.A. (COMESA) (Argentina) (1%)
CMS Ensenada S. A. (Argentina) (1%)
CMS Generation S.K.L. (Argentina) (0.01%)
Genesee Power Station Limited Partnership (DE) (48.75%)
GPSNewco, L.L.C. (KS) (50%)   Note: Moose River Properties (DE) (50% by Gen Co)
was dissolved Feb. 26, 2003.
 
           
7.
  CMS Generation Honey Lake Company (MI) (100%)   HL Power Company, a California
Limited Partnership (CA) (.5%)
Honey Lake Energy I L.P. (CA) (99%)
Honey Lake Energy II, L.P. (CA) (99%)    
 
           
7.
  CMS Generation Michigan Power L.L.C. (MI) (100%)   None   Note: Potential
notice re CMS Revolver lenders and AIG pledge, per SJR. Entity is pledged to St.
Paul until November 24, 2006. per SJR.
 
           
7.
  CMS Generation Operating LLC (MI) (100%)   None    
 
           
7.
  CMS Generation Recycling Company (MI) (100%)   Mid-Michigan Recycling, L.C.
(MI) (50%)*    

A $100,000 bond with City of Flint backed by Generation will have to be
replaced.

64

--------------------------------------------------------------------------------

 

             
Action Step
  Entity Interest Directly Affected (Domicile) (% Ownership by Transferor)  
Subsidiary Entity/Entities Interest(s) Indirectly Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes
 
           
7.
  Dearborn Generation Operating, L.L.C. (MI) (100%)   None    
 
           
7.
  Exeter Energy Limited Partnership (CT) (50%)   None    
 
           
7.
  Hidroelectrica E) Chocon S.A. (Argentina) (2.48%)   None    
 
           
7.
  Honey Lake Energy I L.P. (CA) (1%)   HL Power Company, a California Limited
Partnership (CA) (18.65%)    
 
           
7.
  Honey Lake Energy 11, L.P. (CA) (1%)   HL Power Company, a California Limited
Partnership (CA) (18.65%)    
 
           
7.
  Oxford Tire Recycling, Inc. (DE) (100%)   None    
 
           
7.
  Oxford/CMS Development Limited Partnership (MI) (99%)   Exeter Energy Limited
Partnership (CT) (48%)    
 
           
7.
  Servicios de Aguas de Chile CMS y Compania Limitada (Chile) (99.99%)   None  
 
 
            Step 8: Transfer HYDRA-CO to CMS Enterprises.
 
           
8. CMS Generation LLC (MI) transfers its interest in HYDRA-CO Enterprises, Inc.
(NY) to CMS Enterprises Company (MI)
  HYDRA-CO Enterprises, Inc. (NY) (100%)   CMS Centrales Termicas S.A.
(Argentina) (99%)
CMS Exeter LLC (MI) (100%)
CMS Generation Filer City Operating LLC (MI) (100%)
CMS Generation Filer City, Inc. (MI) (100%)
CMS Generation Genesee Company (Ml) (100%)
CMS Generation Grayling Company (MI) (100%)
CMS Generation Grayling Holdings Company (MI) (100%)
CMS Generation Holdings Company (MI) (100%)   Note: Copenhagen Associates
(49.99% by HYDRA-CO) andHCE Pepperell, Inc. (100% by HYDRA-CO) are no longer CMS
entities and should be removed from the Corporate Secretary’s records.

65

--------------------------------------------------------------------------------

 

              Action Step   Entity Interest Directly Affected (Domicile) (%
Ownership by Transferor)   Subsidiary Entity /Entities Interests) Indirectly
Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes

    CMS Generation Honey Lake Company (MI) (100%)
CMS Generation Michigan Power L.L.C. (MI) (100%)
CMS Generation Operating Company II, Inc. (NY) (100%)
CMS Generation Operating LLC (MI) (100%)
CMS Generation Recycling Company (Ml) (100%)
Craven County Wood Energy Limited Partnership (DE) (44.99%)
Dearborn Generation Operating, L.L.C. (MI) (100%)
Exeter Energy Limited Partnership (CT) (50%)
HCE-Btopower, Inc. (NY) (100%)
HCE-Jamaica Development, Inc. (NY) (100%)
HCE-Rockfort Diesel, Inc. (NY) (100%)
Hidroelectrica El Chocon S.A, (Argentina) (2,48%)
Honey Lake Energy I L.P. (CA) (1%)
Honey Lake Energy II, L.P. (CA) (1%)
1PP Investment Partnership (MI) (49%)
Little Falls Hydroelectric Associates, L.P. (NY) (0.63%)
Little Falls Hydropower Associates (NY) (33.33%)
Lock 17 Group (NY) (33.33%)
Lock 17 Management Group (NY) (33.33%)
New Bern Energy Recovery, Inc. (DE) (100%)
Oxford Tire Recycling, Inc. (DE)(100%)
Oxford/CMS Development Limited Partnership (Ml) (99%)
PowerSmith Cogeneration Project, LP (DE) (6.25%)
Servicios de Aguas de Chile CMS y Compania Limitada (Chile) (99.99%)   Nothing
for tax

66

--------------------------------------------------------------------------------

 

              Action Step   Entity Interest Directly Affected (Domicile) (%
Ownership by Transferor)   Subsidiary Entity/Entities Interest(s) Indirectly
Affected (Domicile)
(% Ownership by Entity Directly Effected)   Consents and/or Action Required
Notes
 
            9: Address intracompany lending transactions.
 
           
9. Intercompany lending transactions Note : don’t forget that Atacma Finance
Company note has to be distributed all the way up to Enterprises and Hidroinvest
note needs to be distributed up from Genration LLC to Enterprises
  Entities to be determined   N/A   Note: Bev Burger, SJR, Tax, et al are
working on the treatment of intercompany loans. Check -the box election is
required on Enterprises International LLC to convert it to a disregarded entity,
which election should be made after the distribution of the Atacama Finance note
receivable up from Enterprises investment Co. into Enterprises International LLC
but before the further distribution of such note up to Generation LLC and then
up to Enterprises

67

--------------------------------------------------------------------------------

 

schedule 5.16 pro forma corporate structure as of closing
(Last Revised: October 5, 2006}
CMS Paten™ ErfirgyCoiipany
CMS £ menu rises lnternationaRLC
Generation LLC
CMS Generation investment
CHS Prairie State LLC
CMS ::n-n!nn:n i.n:’ or LLC
Idafca Win* Generation Company.. LLC
Palermo Energy General Partner Ltd”.
:. MS General on Fn«5trneni Company VU
Taweeiah A’ I Operaijng CoT-pan*
CMS Energy
UK LimJiefl*
CMS G*n<tfaUOn Lfi vastTTrafl” Compary 111
CMS En!erp4**s IriVftslmanl C C n n i ;nn * n v I
_    Palermo Energy
CMC General ion investnenl Camp-any IV
CMS Generation L uxcriibu u rg S.A.H.L
CMS Generation Inveslmenl Company II
CMS Ger*ralkiri Niv.“i n and. BV.
CMS G&Pflfaikin Jorf L Hilar E L.irv\j Duration Companv
Jorf Laisfar Puwei Energy Aktiebolag
CMS Takoradr Investment Company
Shuweihat O&M General Partner Company
Shuweihsfl General Partner Company
Shuweihat DIM Lrmrtad Partnership
ShuweihaJLiroilerJ ]_
Partnership
CMS -iuttai Investment Company I
CMS Generation Ts.weelah Lirnjlsd
CMS Generation Neyveli L \.
CMS rmefnalkmaf Operating Company
I Uairrtflrianit Compaq I
75*
Company
Ernirfllefi CMS Power company
ST-CMS Electric Company (Vjtjrttiusi
ST-CMS eteclFK Company PJ. Ltd.
CMS Generation Jqrf Lasfir || LJmilerJ
Duration Company
50% |
Jorf Lit.-; Fa i EnefgiAfcti’ebolafl
L
Jorf Lasfar Handehbolag
Jorf Lasfar Energy Company,. SCA
!
50%
Jorf Lasfar I t-ffl
Stiuweihal CMS Intern alionaf Power Company <UAEJ
Taweeiah Shareu Facilities Company LLC
| South India Natural I    Gas Marketing I Company Private
Shuweihat Shared Fatf lilies Company LLC
CMS Generation LrK i Operating; Private I Limited
50%
Jorf Ustsr
WdJabDJag
CMS General on
Jorf Lasfar lit Limilerf Duration Company
Jorf Lasfaf Power 50^|     Energy HB
CMS Morocco Operating Co.. SCA

--------------------------------------------------------------------------------

 

EXECUTION VERSION
AMENDMENT NO. 1
TO AGREEMENT OF PURCHASE AND SALE
          Amendment No. 1, dated as of April 12, 2007 (this “Amendment”), to the
Agreement of Purchase and Sale, dated as of February 3, 2007 (the “Agreement”),
by and between CMS Enterprises Company, a Michigan corporation (“Seller”), and
Abu Dhabi National Energy Company PJSC, a United Arab Emirates public joint
stock company (“Buyer”). Capitalized terms used but not defined herein shall
have the meanings ascribed to them in the Agreement.
          WHEREAS, Section 9.18 of the Agreement provides that no amendment to
the Agreement shall be effective unless it shall be in writing and signed by
each party to the Agreement; and
          WHEREAS, the parties wish to amend the Agreement and the Seller
Disclosure Letter as provided in this Amendment.
          NOW, THEREFORE, in consideration of the mutual promises and covenants
set forth herein and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, and intending to be legally bound,
the parties hereby agree as follows:
          1. Amendment to Table of Contents. Section 5.16 of the Table of
Contents is hereby amended and restated in its entirety to read as follows:
     Section 5.16 Merger
          2. Amendment to Index of Defined Terms. The term “Redomiciliation” is
hereby deleted from the Index of Defined Terms.
          3. Amendment to the fourth WHEREAS clause. The fourth WHEREAS clause
is hereby amended and restated in its entirety to read as follows:
WHEREAS, prior to the Closing, Seller shall cause Generation to be merged by
operation of law into a Michigan limited liability company in accordance with
Section 5.16 (the “Merger”);
          4. Amendment to Section 1.2(b). Section 1.2(b) of the Agreement is
hereby amended and restated in its entirety to read as follows:
As of the Closing Date, the term “Generation” shall mean CMS Generation LLC, a
Michigan limited liability company.
          5. Amendment to Section 5.16. Section 5.16 of the Agreement is hereby
amended and restated in its entirety to read as follows:

 

--------------------------------------------------------------------------------

 

Prior to Closing, Seller shall (a) cause the Merger to be consummated and
(b) cause the tax elections set forth in Section 5.16 of the Seller Disclosure
Letter (the “Tax Elections”) to be consummated, and Seller shall keep Buyer
reasonably updated in relation to the progress of the Merger and Tax Elections
and allow Buyer and its advisors reasonable opportunity to review and comment on
all documentation relating to the Merger and Tax Elections. Buyer shall be
responsible for the payment of all costs, Taxes and reasonable expenses relating
to the implementation of the Merger and Tax Elections, up to an aggregate amount
of $100,000.
          6. Amendment to the Seller Disclosure Letter. The Seller Disclosure
Letter Schedules 5.15 and 5.16 are hereby amended and replaced in their entirety
with the documents attached hereto as Annex A and Annex B, respectively.
          7. Governing Law. This Amendment shall be governed by and construed in
accordance with the Laws of the State of New York applicable to agreements made
and to be performed entirely within such State, without regard to the conflict
of laws principles of such State.
          8. Miscellaneous.
     (a) Except as expressly amended and supplemented hereby, the Agreement
remains in full force and effect.
     (b) This Amendment may be executed in two (2) or more counterparts, each of
which, when executed, shall be deemed to be an original and both of which
together shall constitute one and the same document.
     (c) This Amendment is limited by its terms and does not and shall not serve
to amend or waive any provision of the Agreement except as expressly provided
for in this Amendment.
     (d) Any reference to the Agreement in the Agreement or any other document
(except as specifically indicated to the contrary) shall be deemed to be a
reference to the Agreement as amended hereby.
     (e) This Amendment may be amended, modified or supplemented only by written
mutual agreement of Seller and Buyer.
     9. Acknowledgement. Buyer acknowledges that this Amendment effects the
termination of any and all obligations, responsibilities and use of reasonable
best efforts by Seller to (i) cause CMS Generation Co. to be merged into a
Delaware limited liability company, or (ii) to redomiciliate CMS Generation LLC
in the Cayman Islands. Buyer acknowledges that any and all adverse impact to
Buyer that has been or may be caused by the matters agreed to herein shall not
be considered to be a Material Adverse Effect or a violation by Seller under the
original Section 5.16 of the Agreement. Buyer acknowledges that Seller fulfilled
its obligations in Section 5.4(b) of the agreement with respect to using its
reasonable best efforts to obtain from relevant Governmental

 

--------------------------------------------------------------------------------

 

Authorities the approvals and consents listed in Section 6.3(d) of the Seller
Disclosure Letter under the headings “Governmental Consents” and “Jorf Consents”
(subparagraph 2 only).

 

--------------------------------------------------------------------------------

 

EXECUTION VERSION
     IN WITNESS WHEREOF, each of Seller and Buyer has caused this Amendment to
the Agreement to be duly executed on its behalf by an authorized officer as of
the date first above written.

            CMS ENTERPRISES COMPANY
      By:           Name:           Title:        

            ABU DHABI NATIONAL ENERGY COMPANY PJSC
      By:           Name:   Peter Barker Homek        Title:   Chief Executive
Officer     

 

--------------------------------------------------------------------------------

 

Annex A
Schedule 5.15

 

--------------------------------------------------------------------------------

 

SCHEDULE 5.15 CORPORATE RESTRUCTURING

                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected) Step I
: Convert Taweelah A2 Operating Company, a Michigan corporation, to a Michigan
LLC (via several steps).
 
       
1. Merge Taweelah A2 Operating Company (MI) into New Taweelah LLC (MI)
Note: Entity name following merger will be Taweelah A2 Operating LLC.
  Taweelah A2 Operating Company (MI)   None
 
        Step 2: Transfer Jegurupadu entities related to historic Indian
operations to CMS International Ventures.
 
       
2a. CMS Generation Investment Company III (Cayman) transfers its interests in
the Jegurupadu entities, related to historic Indian operations to CMS
International Ventures LLC (MI)
  CMS Generation Jegurupadu I Limited Duration Company (Cayman) (99%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)
 
       
2a.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (99%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)
 
       
2a.
  Jegurupadu CMS Generation Company Ltd. (Mauritius) (100%)   None
 
       
2b. CMS Enterprises Investment Company I (Cayman) transfers its interests in the
Jegurupadu entities related to historic Indian operations to CMS Enterprises
International LLC (MI)
  CMS Generation Jegurupadu I Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)

 

--------------------------------------------------------------------------------

 

                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
2b.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)
 
       
2c. CMS Enterprises International LLC (MI) transfers its interests in the
Jegurupadu entities related to historic Indian operations to CMS Generation LLC
(MI)
  CMS Generation Jegurupadu I Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)
 
       
2c.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)
 
       
2d. CMS Generation LLC (MI) transfers its interests in the Jegurupadu entities
related to historic Indian operations to CMS Enterprises Company (MI)
  CMS Generation Jegurupadu I Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)
 
       
2d.
  CMS Generation Jegurupadu II Limited Duration Company (Cayman) (1%)  
Jegurupadu O&M Company Mauritius (Mauritius) (50%)
 
        Step 3: Transfer Indian entities related to historic Indian operations
to HYDRA-CO.
 
       
3a. CMS (India) Operations & Maintenance Company Private Limited (India)
transfers its ownership interests in South India Natural Gas Marketing Company
Private Limited (India) and TN-LNG Power Co. Pvt. Ltd. (India) pro rata to its
owners (CMS International Operating Company (Cayman) and CMS Generation LLC
(MI))
  South India Natural Gas Marketing Company Private Limited (India) (36.94%)
TN-LNG Power Co. Pvt. Ltd. (India) (36.04%)   None

 

--------------------------------------------------------------------------------

 

                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
3b. CMS International Operating Company (Cayman) transfers its inerests in South
India Natural Gas Marketing Company Private Limited (India) and TN-LNG Power Co.
Pvt. Ltd. (India) to CMS Generation LLC (MI)
  South India Natural Gas Marketing Company Private Limited (India) (Intl
Operating’s pro rata ownership interests)

TN-LNG Power Co.Pvt. Ltd. (India) (Intl Operating’s pro rata ownership
interests)   None
 
       
3c. CMS Generation LLC (MI) transfers the interests it holds in South India
Natural Gas Marketing Company Private Limited (India) and TN-LNG Power Co. Pvt.
Ltd. (India) to HYDRA-CO Enterprises, mc. (NY)
  South India Natural Gas Marketing Company Private Limited (India)
(Generation’s pro rata share, plus Intl Operating’s pro rata share transferred
to Generation in the previous Step)

TN-LNG Power Co. Pvt. Ltd. (India) (Generation’s pro rata share, plus Intl
Operating’s pro rata share transferred to Generation in the previous Step)  
None
 
        Step 4: Transfer CMS Generation Investment Company III (Neyveli) to CMS
Generation.
 
       
4a. CMS International Ventures LLC (MI) transfers its interest in CMS Generation
Investment Company III (Cayman) pro rata to members (CMS Generation LLC (MI),
CMS Gas Transmission Company (MI) and CMS Enterprises Company (MI)
  CMS Generation Investment Company III (Cayman) (100%)   CMS Generation Neyveli
Ltd. (Mauritius) (100%)
 
       
4b. CMS Gas Transmission Company (MI) transfers its interests in CMS Generation
Investment Company III (Cayman) to CMS Enterprises Company (MI)
  CMS Generation Investment Company III (Cayman) (GT’s pro rata ownership
interests of GIC III)   CMS Generation Neyveli Ltd. (Mauritius) (100%)

 

--------------------------------------------------------------------------------

 

                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
4c. CMS Enterprises Company (MI) transfers the interests it holds in CMS
Generation Investment Company 111 (Cayman) to CMS Generation LLC (MI)
  CMS Generation Investment Company III (Cayman) (Enterprises’ pro rata share of
GIC III, plus GT’s pro rata share transferred to ENT in previous Step)   CMS
Generation Neyveli Ltd. (Mauritius) (100%)
 
        Step 5: Transfer CMS Generation’s interest in CMS International Ventures
to CMS Enterprises.
 
       
5. CMS Generation LLC (MI) transfers its 21.02% interest in CMS International
Ventures LLC (MI) to CMS Enterprises Company (MI)
  CMS International Ventures LLC (MI) (21.02%)   CMS Electric & Gas, L.L.C. (MI)
(100%)
CMS Gas Transmission del Sur Company (Cayman) (1 00%)
CMS Generation Investment Company V (Cayman) (100%)
CMS Generation S.R.L. (Argentina) (100%)’
CMS Luxembourg S.a.r.l. (Luxembourg) (100%)
CMS Operating S.R.L. (Argentina) (100%)’
 
        Step 6: Transfer IPP entities not included in the transaction to
HYDRA-CO.
 
       
6. CMS Generation LLC (MI) transfers its holdings in assets (transfer of direct
and indirect interests) not included in the transaction to HYDRA-CO Enterprises,
Inc. (NY)
  CMS Centrales Termicas S.A. (Argentina) (99%)’   Cuyana S.A. de Inversiones
(Argentina) (1%)’
 
       
6.
  CMS Exeter LLC (MI) (100%)   Exeter Energy Limited Partnership (CT) (2%)
Oxford/CMS Development Limited Partnership (MI) (1%)
 
       
6.
  CMS Generation Filer City Operating LLC (MI) (100%)   None
 
       
6.
  CMS Generation Filer City, Inc (MI) (100%)   T.E.S. Filer City Station Limited
Partnership (MI) (50%)
 
       
6.
  CMS Generation Genesee Company (MI) (100%)   Genesee Power Station Limited
Partnership (DE) (1%)

1 Ownership interests in this entity have been transferred by CMS Generation Co.
pursuant to the sale of Argentine assets (March 2007).

 

--------------------------------------------------------------------------------

 

                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
6.
  CMS Generation Grayling Company (MI) (100%)   Grayling Generating Station
Limited Partnership (MI) (1%)
Grayling Partners Land Development, L.L.C. (MI) (1%)
 
       
6.
  CMS Generation Grayling Holdings Company (MI) (100%)   Grayling Generating
Station Limited Partnership (MI) (49%)
Grayling Partners Land Development, L.L.C. (MI) (49%)
 
       
6.
  CMS Generation Holdings Company (MI) (100%)   CMS Centrales Termicas S.A.
(Argentina) (1%)’
CMS Comercializadora de Energia S.A. (COMESA) (Argentina) (1%)’
CMS Ensenada S. A. (Argentina) (1%)’
CMS Generation S.R.L. (Argentina) (0.01%)’
Genesee Power Station Limited Partnership (DE) (48.75%)
GPS Newco, L.L.C. (KS) (50%)
 
       
6.
  CMS Generation Honey Lake Company (MI) (100%)   HL Power Company, a California
Limited Partnership (CA) (.5%)
Honey Lake Energy I L.P. (CA) (99%)
Honey Lake Energy II, L.P. (CA) (99%)
 
       
6.
  CMS Generation Michigan Power L.L.C. (MI) (100%)   None
 
       
6.
  CMS Generation Operating LLC (MI) (100%)   None
 
       
6.
  CMS Generation Recycling Company (MI) (100%)   Mid-Michigan Recycling, L.C.
(MI) (50%)
 
       
6.
  CMS Generation San Nicolas Company (MI) (0.1%)’   Inversora de San Nicolas,
S.A. (0.1%)’
 
       
6.
  CMS Palermo Energy Company (Nova Scotia) (100%)   Palermo Energy General
Partner Ltd. (Nova Scotia) (100%)
Palermo Energy Limited Partnership (Ontario) (99.999%)
 
       
6.
  CMS Prairie State LLC (MI) (100%)   Lively Grove Energy, LLC (DE) (50%)
 
       
6.
  Dearborn Generation Operating, L.L.C. (MI) (100%)   None

 

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                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
6.
  Exeter Energy Limited Partnership (CT) (50%)   None
 
       
6.
  Hidroelectrica El Chocon S.A. (Argentina) (2.48%)’   None
 
       
6.
  Honey Lake Energy I L.P. (CA) (1%)   HL Power Company, a California Limited
Partnership (CA) (18.65%)
 
       
6.
  Honey Lake Energy II, L.P. (CA) (1%)   HL Power Company, a California Limited
Partnership (CA) (18.65%)
 
       
6.
  Idaho Wind Generation Company, LLC (DE) (100%)   None
 
       
6.
  Lassen Wind Generation LLC (MI) (100%)   None
 
       
6.
  Oxford Tire Recycling Inc. (DE) (100%)   None
 
       
6.
  OxfordiCMS Development Limited Partnership (MI) (99%)   Exeter Energy Limited
Partnership (CT) (48%)
 
       
6.
  Servicios de Aguas de Chile CMS y Compania Limitada (Chile) (99.99%)   None
 
        Step 7: Transfer HYDRA-CO to CMS Enterprises.
 
       
7. CMS Generation LLC (MI) transfers its interest in HYDRA-CO Enterprises, Inc.
(NY) to CMS Enterprises Company (MI)
  HYDRA-CO Enterprises, Inc. (NY) (100%)   CMS Centrales Termicas S.A.
(Argentina) (99%)’
CMS Exeter LLC (MI) (100%)
CMS Generation Filer City Operating LLC (MI) (100%)
CMS Generation Filer City, Inc. (MI) (100%)
CMS Generation Genesee Company (MI) (100%)
CMS Generation Grayling Company (MI) (100%)
CMS Generation Grayling Holdings Company (MI) (100%)
CMS Generation Holdings Company (MI) (100%)
CMS Generation Honey Lake Company (MI) (100%)
CMS Generation Michigan Power L.L.C. (MI) (100%)
CMS Generation Operating Company 11, Inc. (NY) (100%)

 

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                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
 
      CMS Generation Operating LLC (MI) (100%)
CMS Generation Recycling Company (MI) (100%)
CMS Generation San Nicolas Company (MI) (0.1%)’
CMS Palermo Energy Company (Nova Scotia) (100%)
CMS Prairie State LLC (MI) (100%)
Craven County Wood Energy Limited Partnership (DE) (44.99%)
Dearborn Generation Operating, L.L.C. (MI) (100%)
Exeter Energy Limited Partnership (CT) (50%)
HCE-Biopower, Inc. (NY) (100%)
HCE-Jamaica Development, Inc. (NY) (1 00%)
HCE-Rockfort Diesel, Inc. (NY) (1 00%)
Hidroelectrica El Chocon S.A. (Argentina) (2.48%)’
Honey Lake Energy I L.P. (CA) (1%)
Honey Lake Energy 1I, L.P. (CA) (1%)
Idaho Wind Generation Company, LLC (DE) (100%)
IPP Investment Partnership (MI) (49%)
Lassen Wind Generation ILC (MI) (100%)
Little Falls Hydroelectric Associates, L.P. (NY) (0.63%)
Little Falls Hydropower Associates (NY) (33.33%)
Lock 17 Group (NY) (33.33%)
Lock 17 Management Group (NY) (33.33%)
New Bern Energy Recovery, Inc. (DE) (100%)
Oxford Tire Recycling, Inc. (DE) (100%)
Oxford/CMS Development Limited Partnership (MI) (99%)
PowerSmith Cogeneration Project, LP (DE) (6.25%)
Servicios de Aguas de Chile CMS y Compania Limitada (Chile) (99.99%)

 

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                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
 
      South India Natural Gas Marketing Company Private Limited (India) (36.94%)
TN-LNG Power Co. Pvt. Ltd. (India) (36.04%)
 
        Step 8: Transfer CMS Energy UK Limited to CMS Generation.
 
       
8. CMS Enterprises Company (MI) contributes its interest in CMS Energy UK
Limited (England) to CMS Generation LLC (MI)
  CMS Energy UK Limited (England) (100%)   None
 
        Step 9: Address intercompany lending transactions.
 
       
9. Intercompany lending transactions
  Entities to be determined.   N/A

 

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Annex B
Schedule 5.16

 

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SCHEDULE 5.16
MERGER AND TAX ELECTION
5.16(a): Merger

                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected) Step
1: Convert CMS Generation Co. (MI) to a Michigan LLC (via several steps).
 
       
la. Merge CMS Generation Co. (MI) into New Generation LLC (MI)
Note: Entity name following merger will be CMS Generation LLC
  CMS Generation Co. (MI)   CMS (India) Operations & Maintenance Company Private
Limited (India) (1%)
CMS Centrales Termicas S.A. (Argentina) (99%)’
CMS Enterprises International LLC (MI) (100%)
CMS Exeter LLC (MI) (100%)
CMS Generation Filer City Operating LLC (MI) (100%)
CMS Generation Filer City, Inc. (MI) (100%)
CMS Generation Genesee Company (MI) (100%)
CMS Generation Grayling Company (MI) (100%)
CMS Generation Grayling Holdings Company (MI) (100%)
CMS Generation Holdings Company (MI) (100%)
CMS Generation Honey Lake Company (MI) (100%)
CMS Generation Investment Company VI (Cayman) (100%)
CMS Generation Investment Company VII (Cayman) (100%)
CMS Generation Michigan Power L.L.C. (MI) (100%)
CMS Generation Operating LLC (MI) (100%)
CMS Generation Recycling Company (MI) (1 00%)
CMS Generation San Nicolas Company (MI) (0.1%)’
CMS International Operating Company (Cayman) (100%)
CMS International Ventures, L.L.C. (MI) (21.02%)
CMS Morocco Operating Co., S.C.A. (Morocco) (0.1%)

1 Ownership interests in this entity have been transferred by CMS Generation Co.
pursuant to the sale of Argentine assets (March 2007).

 

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                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected)
 
      CMS Palermo Energy Company (Nova Scotia) (100%)
CMS Prairie State LLC (MI) (100%)
Dearbom Generation Operating, L.L.C. (MI) (100%)
Exeter Energy Limited Partnership (CT) (50%)
Hidroelectrica El Chocon S.A. (Argentina) (2.48%)’
Honey Lake Energy I L.P. (CA) (1%)
Honey Lake Energy II, L.P. (CA) (1%)
HYDRA-CO Enterprises, Inc. (NY) (100%)
Idaho Wind Generation Company, LLC (DE) (100%)
Lassen Wind Generation LLC (MI) (100%)
Oxford Tire Recycling, Inc. (DE) (100%)
Oxford/CMS Development Limited Partnership (MI) (99%)
Servicios de Aguas de Chile CMS y Compania Limitada (Chile) (99.99%)
Taweelah A2 Operating Company (MI) (100%)’

5.16(b): Tax Election

                  Subsidiary Entity/Entities Interest(s)     Entity Interest
Directly Affected   Indirectly Affected     (Domicile)   (Domicile) Action Step
  (% Ownership by Transferor)   (% Ownership by Entity Directly Effected) Step
1: Complete election related to tax status.
 
       
1. Change tax status of CMS Enterprises International LLC (MI) to a disregarded
entity
  CMS Enterprises International LLC (MI)   N/A

2 Taweelah A2 Operating Company, a Michigan corporation, will be converted to a
Michigan LLC pursuant to the Reorganization.