Document:

exv4w252

Exhibit 4-252

 

THE DETROIT EDISON COMPANY

AND

THE BANK OF NEW YORK TRUST COMPANY, N.A.

TRUSTEE

 

TWENTY-THIRD SUPPLEMENTAL INDENTURE

DATED AS OF APRIL 1, 2008

 

SUPPLEMENTING THE COLLATERAL TRUST INDENTURE

DATED AS OF JUNE 30, 1993

PROVIDING FOR

2008 SERIES DT VARIABLE RATE SENIOR NOTES DUE 2036

 

 

 

     SUPPLEMENTAL INDENTURE, dated as of the 1st day of April 2008, between THE DETROIT EDISON
COMPANY, a corporation organized and existing under the laws of the State of Michigan (the
“Company”), and THE BANK OF NEW YORK TRUST COMPANY, N.A., a national banking association organized
under the laws of the United States of America, having a corporate trust office in the City of
Detroit, Michigan, as successor trustee (the “Trustee”);

     WHEREAS, the Company has heretofore executed and delivered to the Trustee a Collateral Trust
Indenture dated as of June 30, 1993 (the “Original Indenture”), as supplemented, providing for the
issuance by the Company from time to time of its debt securities; and

     WHEREAS, the Company now desires to provide for the issuance of an additional series of its
senior debt securities pursuant to the Original Indenture in connection with its obligations to the
Michigan Strategic Fund (the “MSF”) under the Loan Agreement dated as of April 1, 2008 (the “Loan
Agreement”) relating to the Michigan Strategic Fund Variable Rate Limited Obligation Refunding
Revenue Bonds (The Detroit Edison Company Exempt Facilities Project), Series 2008DT (the “2008DT
Bonds”); and

     WHEREAS, the Company intends hereby to designate a series of debt securities which shall have
the benefit of the provisions of Article Four of the Original Indenture and the other related
provisions of the Original Indenture relating to the grant of security, subject to the release
provisions provided for herein, and which shall have the terms and variations from the provisions
of the Original Indenture as set forth herein; and

     WHEREAS, the Company, in the exercise of the power and authority conferred upon and reserved
to it under the provisions of the Original Indenture, including Section 1001 thereof, and pursuant
to appropriate resolutions of the Board of Directors, has duly determined to make, execute and
deliver to the Trustee this Twenty-Third Supplemental Indenture to the Original Indenture as
permitted by Sections 201 and 301 of the Original Indenture in order to establish the form or terms
of, and to provide for the creation and issue of, a series of its debt securities under the
Original Indenture, which shall be known as the 2008 Series DT Variable Rate Senior Notes due 2036;
and

     WHEREAS, all things necessary to make such debt securities, when executed by the Company and
authenticated and delivered by the Trustee or any Authenticating Agent and issued upon the terms
and subject to the conditions hereinafter and in the Original Indenture set forth against payment
therefor, the valid, binding and legal obligations of the Company and to make this Twenty-Third
Supplemental Indenture a valid, binding and legal agreement of the Company, have been done;

     NOW, THEREFORE, THIS TWENTY-THIRD SUPPLEMENTAL INDENTURE WITNESSETH that, in order to
establish the terms of a series of debt securities, and for and in consideration of the premises
and of the covenants contained in the Original Indenture and in this Twenty-Third Supplemental
Indenture and for other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, it is mutually covenanted and agreed as follows:

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ARTICLE ONE

DEFINITIONS AND OTHER

PROVISIONS OF GENERAL APPLICATION

     SECTION 1.01. Definitions. Each capitalized term that is used herein and is defined in the
Original Indenture shall have the meaning specified in the Original Indenture unless such term is
otherwise defined herein. The following terms shall have the respective meanings set forth below:

     “2008DT Bonds” means the $68,500,000 Michigan Strategic Fund Variable Rate Limited Obligation
Refunding Revenue Bonds (The Detroit Edison Company Exempt Facilities Project), Series 2008DT.

     “Bond Indenture” means the Trust Indenture, dated as of April 1, 2008 between the Michigan
Strategic Fund and the Bond Trustee providing for the issuance of the 2008DT Bonds.

     “Bond Trustee” means The Bank of New York Trust Company, N.A., as trustee under the Bond
Indenture, or any successor thereto.

     “Business Day” means any day except a Saturday, Sunday or other day (i) on which commercial
banks located in the cities in which the Principal Office of the Trustee, the Principal Office of
the Company, the Principal Office of the Remarketing Agent, the Principal Office of the Auction
Agent during any Auction Period or the Principal Office of the Paying Agent, each as defined in the
Bond Indenture, are located are required or authorized by law or regulation to remain closed or are
closed, or (ii) on which The New York Stock Exchange is closed.

     “Capitalization” means the total of all the following items appearing on, or included in, the
consolidated balance sheet of the Company: (i) liabilities for indebtedness maturing more than 12
months from the date of determination; and (ii) common stock, common stock expense, accumulated
other comprehensive income or loss, preferred stock, preference stock, premium on capital stock and
retained earnings (however the foregoing may be designated), less, to the extent not otherwise
deducted, the cost of shares of capital stock of the Company held in its treasury, if any. Subject
to the foregoing, Capitalization shall be determined in accordance with generally accepted
accounting principles and practices applicable to the type of business in which the Company is
engaged and may be determined as of a date not more than 60 days prior to the happening of the
event for which the determination is being made. In connection with such determination, the
Company shall certify to the Trustee that it has, prior to making its final determination,
consulted with the independent accountants regularly retained by the Company.

     “Debt” means any outstanding debt for money borrowed evidenced by notes, debentures, bonds or
other securities, or guarantees of any debt.

     “Net Tangible Assets” means the amount shown as total assets on the consolidated balance sheet
of the Company, less (i) intangible assets including, but without limitation, such items as
goodwill, trademarks, trade names, patents, unamortized debt discount and expense and other
regulatory assets carried as an asset on the Company’s consolidated balance sheet, and (ii)
appropriate adjustments, if any, on account of minority interests. Net Tangible Assets shall be

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determined in accordance with generally accepted accounting principles and practices
applicable to the type of business in which the Company is engaged and may be determined as of a
date not more than 60 days prior to the happening of the event for which such determination is
being made. In connection with such determination, the Company shall certify to the Trustee that
it has, prior to making its final determination, consulted with the independent accountants
regularly retained by the Company.

     “Operating Property” means (i) any interest in real property owned by the Company and (ii) any
asset owned by the Company that is depreciable in accordance with generally accepted accounting
principles, excluding, in either case, any interest of the Company as lessee under any lease
(except for a lease that results from a Sale and Lease-Back Transaction) that has been or would be
capitalized on the books of the lessee in accordance with generally accepted accounting principles.

     “Pledged Bonds” means the related series of Bonds (as hereafter defined) and any other
Mortgage Bonds issued to secure Securities subject to the release provisions provided herein or in
any other supplemental indenture to the Original Indenture.

     “Release Date” means the date as of which all Mortgage Bonds, (i) other than the Pledged
Bonds, including the related series of Bonds, and (ii) other than outstanding Mortgage Bonds
(exclusive of Pledged Bonds) which do not in aggregate principal amount exceed the greater of 5% of
the Net Tangible Assets of the Company or 5% of the Capitalization of the Company, have been
retired through payment, redemption or otherwise, provided that no default or Event of Default has
occurred and, at such time, is continuing under the Original Indenture.

     “Sale and Lease-Back Transaction” means any arrangement with any person providing for the
leasing to the Company of any Operating Property (except for leases for a term, including any
renewal or potential renewal, of not more than 48 months), which Operating Property has been or is
to be sold or transferred by the Company to the person; provided, however, Sale and Lease-Back
Transaction shall not include any arrangement first entered into prior to the date hereof and shall
not include any transaction pursuant to which the Company sells Operating Property to, and
thereafter purchases energy or services from, any entity, which transaction is ordered or
authorized by any regulatory authority having jurisdiction over the Company or its operations or is
entered into pursuant to any plan or program of industry restructuring ordered or authorized by any
such regulatory authority.

     “Substitute Mortgage” means a mortgage indenture of the Company, other than the Mortgage,
designated by the Company to the Trustee as a Substitute Mortgage pursuant to Section 4.03 hereof.
The lien of the Substitute Mortgage shall have such priority, and be with respect to such property,
as shall be specified by the Company in its sole discretion.

     “Substitute Mortgage Bonds” means any mortgage bonds issued by the Company under a Substitute
Mortgage and delivered to the Trustee pursuant to Section 4.03 hereof or pursuant to the comparable
provision of any other supplemental indenture relating to Securities subject to the release
provisions.

     “Value” means, with respect to a Sale and Lease-Back Transaction, as of any particular time,
the amount equal to the greater of (i) the net proceeds to the Company from the sale or

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transfer of the property leased pursuant to the Sale and Lease-Back Transaction or (ii) the
net book value of the property, as determined by the Company in accordance with generally accepted
accounting principles at the time of entering into the Sale and Lease-Back Transaction, in either
case multiplied by a fraction, the numerator of which shall be equal to the number of full years of
the term of the lease that is part of the Sale and Lease-Back Transaction remaining at the time of
determination and the denominator of which shall be equal to the number of full years of the term,
without regard, in any case, to any renewal or extension options contained in the lease.

     SECTION 1.02. Section References. Each reference to a particular section set forth in this
Twenty-Third Supplemental Indenture shall, unless the context otherwise requires, refer to this
Twenty-Third Supplemental Indenture.

ARTICLE TWO

TITLE AND TERMS OF THE SECURITIES

     SECTION 2.01. Title of the Securities; Stated Maturity. This Twenty-Third Supplemental
Indenture hereby establishes a series of Securities, which shall be known as the Company’s “2008
Series DT Variable Rate Senior Notes due 2036” (the “Notes”). For purposes of the Original
Indenture, the Notes shall constitute a single series of Securities. The Stated Maturity on which
the principal of the Notes shall be due and payable will be December 1, 2036. The Notes are being
issued to secure the Company’s obligations to the MSF under the Loan Agreement.

     SECTION 2.02. Certain Variations from the Original Indenture.

     (a) The Notes shall have the benefit of the provisions of Article Four of the Original
Indenture and shall have the benefit of, or be subject to, the other related provisions of the
Original Indenture relating to the grant of security, including (for avoidance of doubt and not for
purposes of limitation) the Granting Clause, the definitions of “Deliverable Mortgage Bonds,”
“Deliverable Securities,” “Designated Mortgage Bonds,” “Grant,” “Mortgage,” “Mortgage Bonds,”
“Mortgage Trustee,” “Previously Delivered Mortgage Bonds,” and “Trust Estate,” Section 301(20),
Section 301(a), Section 301(b), Section 301(d), and Article VI, subject, in each case, to the
release provisions provided for in Section 4.02 herein. In addition, on and after the Release
Date, unless Substitute Mortgage Bonds are issued to secure the Notes, the Notes shall have the
benefit of the additional covenants set forth in Article Three hereof.

     (b) In the event the Company desires to provide for the payment of the Notes, in lieu of
defeasing the Notes in accordance with Section 503 of the Original Indenture, it shall either
redeem an equal principal amount of the 2008DT Bonds or take such action as shall be required by
Article VIII of the Bond Indenture to defease an equal principal amount of the 2008DT Bonds.
Pursuant to Section 2.03(c) hereof, such redemption or defeasance shall result in the discharge of
the Company’s obligation with respect to the Notes and the cancellation of the Notes.

     (c) Any amount payable by the Company in respect of principal of the Notes, whether at
maturity or prior to maturity by redemption or upon redemption or acceleration or otherwise, in a
circumstance where there has not been a corresponding payment of principal of 2008DT Bonds, shall
be applied simultaneously to the redemption or defeasance of an equal principal amount of

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2008DT Bonds in accordance with the Bond Indenture. In the event the amount so paid is
insufficient to provide for such redemption or defeasance, the Company shall pay such additional
amounts as shall be necessary to make up the deficiency.

     SECTION 2.03. Amount, Assignability and Redemption.

     (a) The aggregate principal amount of Notes that may be issued under this Twenty-Third
Supplemental Indenture is limited to $68,500,000 (except as provided in Section 301(2) of the
Original Indenture). The Notes shall be issuable only as Registered Securities without coupons
and, as permitted by Section 301 and Section 302 of the Original Indenture, in denominations of
$1,000 and integral multiples thereof to the Bond Trustee as assignee of the MSF, pursuant to the
Loan Agreement. The Notes shall not be further assignable or transferable except as may be
required to effect a transfer to any successor Bond Trustee.

     (b) The Notes may bear such legends as may be necessary to refer to the Loan Agreement or to
comply with any law or with any rules or regulations made pursuant thereto or to evidence the
limited assignability.

     (c) Upon payment of the principal, premium, if any, or interest on the 2008DT Bonds, whether
at maturity or prior to maturity by redemption or otherwise, or upon provision for the payment
thereof having been made in accordance with Article IV or VIII of the Bond Indenture, Notes in a
principal amount equal to the principal amount of the 2008DT Bonds shall, to the extent of such
payment of principal, premium or interest, be deemed fully paid and the obligation of the Company
thereunder to make such payment shall forthwith cease and be discharged, and, in the case of the
payment of principal and premium, if any, such Notes shall be surrendered for cancellation or
presented for appropriate notation to the Trustee.

     (d) The Notes shall be redeemed on the date and in the principal amount which corresponds to
the redemption date for, and the principal amount to be redeemed of, the 2008DT Bonds.

     (e) In the event of an Event of Default under the Bond Indenture and the acceleration of the
2008DT Bonds, the Notes shall be redeemable in whole upon receipt by the Trustee of a written
demand (Redemption Demand) from the Bond Trustee indicating that it has paid accelerated principal.

     SECTION 2.04. Certain Terms of the Notes.

     (a) The Notes shall bear interest at the rate of interest established for the 2008DT Bonds
from time to time in accordance with the Bond Indenture on the principal amount thereof from the
date of original issue, or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, until the principal of the Notes becomes due and payable, and on any
overdue principal and premium and (to the extent that payment of such interest is enforceable under
applicable law) on any overdue installment of interest at the same rate per annum during such
overdue period. Interest on the Notes will be payable on such dates as interest shall be payable
on the 2008DT Bonds (each such date, an “Interest Payment Date”). Payment of interest on the
2008DT Bonds shall be deemed to constitute payment of interest on the Notes. The

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amount of interest payable for any period shall be computed on the same basis as interest on
the 2008DT Bonds pursuant to the Bond Indenture.

     (b) In the event that any Interest Payment Date, redemption date or other date of Maturity of
the Notes is not a Business Day, then payment of the amount payable on such date will be made on
the next succeeding day which is a Business Day (and without any interest or other payment in
respect of any such delay), in each case with the same force and effect as if made on such date.
The interest installment so payable, and punctually paid or duly provided for, on any Interest
Payment Date with respect to any Note will, as provided in the Original Indenture, be paid to the
person in whose name the Note (or one or more Predecessor Securities, as defined in the Original
Indenture) is registered at the close of business on the relevant record date for such interest
installment, which shall be the same as the record date for the 2008DT Bonds with respect to the
relevant Interest Payment Date (the “Regular Record Date”). Any such interest installment not
punctually paid or duly provided for shall forthwith cease to be payable to the registered Holders
on such Regular Record Date, and may either be paid to the person in whose name the Note (or one or
more Predecessor Securities) is registered at the close of business on a Special Record Date to be
fixed by the Trustee for the payment of such defaulted interest, notice whereof shall be given to
the registered Holders of the Notes not less than ten days prior to such Special Record Date, or
may be paid at any time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Notes may be listed, and upon such notice as may be required by
such exchange, all as more fully provided in the Original Indenture. The principal of, and
premium, if any, and the interest on the Notes shall be payable at the office or agency of the
Company maintained for that purpose in the Borough of Manhattan, the City of New York, in any coin
or currency of the United States of America that at the time of payment is legal tender for payment
of public and private debts; provided, however, that payment of interest may be made at the option
of the Company by check mailed to the registered Holder at the close of business on the Regular
Record Date at such address as shall appear in the Security Register. Any waiver or rescission of
a declaration of acceleration of principal of the 2008DT Bonds shall constitute a waiver or
rescission with respect to the Notes.

     (c) The Notes are not subject to repayment at the option of the Holders thereof and are not
subject to any sinking fund, except to the extent that the Bond Trustee, or its successor in
interest, may have exercised its rights pursuant to Section 2.03 hereof. As provided in the form
of the Note attached hereto as Exhibit A, the Notes are subject to Optional Redemption and
Extraordinary Optional Redemption, as a whole or in part, and Special Optional Redemption, in
whole, by the Company prior to Stated Maturity of the principal thereof upon the same terms as the
2008DT Bonds. Except as modified in the form of Note, redemptions shall be effected in accordance
with Article Twelve of the Original Indenture.

     (d) The Notes shall have such other terms and provisions as are set forth in the form of Note
attached hereto as Exhibit A (which is incorporated by reference in and made a part of this
Twenty-Third Supplemental Indenture as if set forth in full at this place).

     SECTION 2.05. Form of Note. Attached hereto as Exhibit A is the form of the definitive Note.
If the Company elects to have the Notes secured by Substitute Mortgage Bonds on and after the
Release Date, the terms of the Notes shall be amended to make appropriate reference to the
Substitute Mortgage and the Substitute Mortgage Bonds; provided, that the consent of Holders shall
not be required in connection with such amendment.

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ARTICLE THREE

ADDITIONAL COVENANTS

     SECTION 3.01. Limitations on Liens.

     (a) From and after the Release Date, unless Substitute Mortgage Bonds are issued to secure the
Notes, so long as any Notes are outstanding, the Company may not issue, assume, guarantee
(including any contingent obligation to purchase) or permit to exist any Debt that is secured by
any mortgage, security interest, pledge or lien (“Lien”) of or upon any Operating Property owned by
the Company, whether owned at the Release Date or subsequently acquired, without effectively
securing the Notes (together with, if the Company shall so determine, any other indebtedness of the
Company ranking equally with the Notes) equally and ratably with the Debt (but only so long as the
Debt is so secured).

     The foregoing restriction will not apply to:

     (i) Liens on any Operating Property existing at the time of its acquisition and not
created in contemplation of the acquisition;

     (ii) Liens on Operating Property of a corporation existing at the time the corporation is
merged into or consolidated with the Company, or at the time the corporation disposes of
substantially all of its properties (or those of a division) to the Company, provided that the
Lien is not extended to property owned by the Company immediately prior to the merger,
consolidation or other disposition and is not created in contemplation of the merger,
consolidation or other disposition;

     (iii) Liens on Operating Property to secure the cost of acquisition, construction,
development or substantial repair, alteration or improvement of such property or to secure
indebtedness incurred to provide funds for any of these purposes or for reimbursement of funds
previously expended for any of these purposes, provided the Liens are created or assumed
contemporaneously with, or within 18 months after, the acquisition or the completion of
substantial repair or alteration, construction, development or substantial improvement or
within 6 months thereafter pursuant to a commitment for financing arranged with a lender or
investor within such 18-month period;

     (iv) Liens in favor of the United States or any state or any department, agency or
instrumentality or political subdivision of the United States or any state, or for the benefit
of holders of securities issued by any of these entities, to secure any Debt incurred for the
purpose of financing all or any part of the purchase price or the cost of substantially
repairing or altering, constructing, developing or substantially improving the Operating
Property; or

     (v) Any extension, renewal or replacement (or successive extensions, renewals or
replacements), in whole or in part, of any Lien referred to in the exceptions listed above,
provided, however, that the principal amount of Debt secured thereby and not otherwise
authorized by those exceptions listed above shall not exceed the principal amount of Debt,

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plus any premium or fee payable in connection with any such extension, renewal or
replacement, so secured at the time of such extension, renewal or replacement.

     (b) In addition, notwithstanding the foregoing restrictions, from and after the Release Date,
the Company may issue, assume or guarantee Debt secured by a Lien which would otherwise be subject
to the foregoing restrictions up to an aggregate amount which, together with all other of the
Company’s secured Debt (not including secured Debt permitted under any of the foregoing exceptions)
and the Value of Sale and Lease-Back Transactions existing at such time (other than Sale and
Lease-Back Transactions the proceeds of which have been applied to the retirement of certain
indebtedness, Sale and Lease-Back Transactions in which the property involved would have been
permitted to be subjected to a Lien under any of the foregoing exceptions, and Sale and Lease-Back
Transactions that are permitted by the first sentence of Section 3.02 below), does not exceed the
greater of 10% of the Company’s Net Tangible Assets or 10% of the Company’s Capitalization. The
foregoing restrictions do not limit the Company’s ability to place Liens on (i) the capital stock
of any of the Company’s subsidiaries or (ii) the assets of any of the Company’s subsidiaries.

     SECTION 3.02. Limitations on Sale and Lease-Back Transactions. So long as the Notes are
outstanding from and after the Release Date, unless Substitute Mortgage Bonds are issued to secure
the Notes, the Company may not enter into or permit to exist any Sale and Lease-Back Transaction
with respect to any Operating Property (except for leases for a term, including any renewal or
potential renewal, of not more than 48 months), if the purchaser’s commitment is obtained more than
18 months after the later of the completion of the acquisition, construction or development of the
Operating Property or the placing in operation of the Operating Property or of the Operating
Property as constructed or developed or substantially repaired, altered or improved. This
restriction will not apply if (a) the Company would be entitled pursuant to Section 3.01(a) above
to issue, assume, guarantee or permit to exist Debt secured by a Lien on the Operating Property
without equally and ratably securing the Notes, (b) after giving effect to the Sale and Lease-Back
Transaction, pursuant to Section 3.01(b) above, the Company could incur at least $1.00 of
additional Debt secured by Liens (other than Liens permitted by clause (a)), or (c) the Company
applies within 180 days an amount equal to, in the case of a sale or transfer for cash, the net
proceeds (not less than the fair value of the Operating Property so leased), and, otherwise, an
amount equal to the fair value (as determined by the Board of Directors of the Company) of the
Operating Property so leased to the retirement of Notes or other Debt of the Company ranking
equally with the Notes; provided, however, that any such retirement of Notes shall be in accordance
with the terms and provisions of the Indenture and the Notes; provided, further, that the amount to
be applied to such retirement of Notes or other Debt shall be reduced by an amount equal to the sum
of (a) an amount equal to the redemption price with respect to Notes delivered within such one
hundred eighty (180)-day period to the Trustee for retirement and cancellation and (b) the
principal amount, plus any premium or fee paid in connection with any redemption in accordance with
the terms of other Debt voluntarily retired by the Company within such one hundred eighty (180)-day
period, excluding in each case retirements pursuant to mandatory sinking fund or prepayment
provisions and payments at Stated Maturity.

     SECTION 3.03. Waiver. Section 1109 of the Original Indenture shall apply to the covenants set
forth in Sections 3.01 and 3.02 above at any time such covenants are in effect.

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ARTICLE FOUR

SECURITY AND RELEASE PROVISIONS

     SECTION 4.01. Security. Subject to Section 4.02 below, as provided in and pursuant to Article
Four of the Original Indenture, the Notes will be secured as to payments of principal, interest and
premium, if any, by a series of Mortgage Bonds (the “General and Refunding Mortgage Bonds, 2008
Series DT,” the “Bonds,” the “Bonds of the related series” or the “related series of Bonds”) of the
Company to be issued concurrently with the issuance of the Notes under and secured by a Mortgage
and Deed of Trust, dated as of October 1, 1924, between the Company and J.P. Morgan Trust Company,
National Association, as successor trustee (the “Mortgage Trustee”), as amended and supplemented by
various supplemental indentures, including the supplemental indenture, dated as of April 1, 2008,
creating the Bonds (collectively, the “Mortgage”), pledged by the Company for the benefit of the
Holders of the Notes to the Trustee under this Twenty-Third Supplemental Indenture. The Bonds
shall be issued in an aggregate principal amount equal to the aggregate principal amount of the
Notes.

     SECTION 4.02. Release. Until the Release Date and subject to Article Four of the Original
Indenture, the Bonds of the related series issued and delivered to the Trustee shall serve as
security for any and all obligations of the Company under all Notes from time to time Outstanding,
including, but not limited to (1) the full and prompt payment of the principal and premium, if any,
on the Notes when and as the same shall become due and payable in accordance with the terms and
provisions of the Indenture or the Notes, either at the Stated Maturity thereof, upon acceleration
of the maturity thereof, upon redemption, or otherwise, and (2) the full and prompt payment of any
interest on the Notes when and as the same shall become due and payable in accordance with the
terms and provisions of this Indenture or the Notes including, if and to the extent provided for in
the Notes, interest on overdue installments of principal and (to the extent permitted by law)
interest on overdue installments of interest.

     Each supplemental indenture to the Mortgage pursuant to which any Bonds are issued shall
contain a provision to the effect that any payment by the Company hereunder of principal of or
premium or interest on Notes which shall have been authenticated and delivered in connection with
the issuance and delivery to the Trustee of such Bonds (other than by the application of the
proceeds of a payment in respect of such Bonds) shall to the extent thereof, be deemed to satisfy
and discharge the obligation of the Company, if any, to make a payment of principal, premium or
interest, as the case may be, in respect of such Bonds which is then due.

     Notwithstanding anything in the Original Indenture to the contrary, from and after the Release
Date, the obligation of the Company to make payment with respect to the principal of and premium,
if any, and interest on the Bonds shall be deemed satisfied and discharged as provided in the
supplemental indenture or indentures to the Mortgage creating such Bonds and the Bonds shall cease
to secure in any manner Notes theretofore or subsequently issued; the Trustee shall thereupon
surrender the Bonds to the Mortgage Trustee for cancellation and execute and deliver such proper
instruments of release as may be required. From and after the Release Date, all Notes, whether
theretofore or subsequently issued, shall, at the Company’s option, either (i) become unsecured or
(ii) be secured by Substitute Mortgage Bonds pursuant to Section 4.03 below, and any conditions to
the issuance of Notes that refer or relate to Bonds or the Mortgage shall be inapplicable (except
as such conditions shall be deemed to refer to Substitute Mortgage

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Bonds or a Substitute Mortgage pursuant to Section 4.03 below). From and after the Release
Date, the Company shall not issue any additional Mortgage Bonds, including Pledged Bonds, under the
Mortgage. Notice of the occurrence of the Release Date shall be given by the Trustee to the
Holders of the Notes in the manner provided for in the Original Indenture not later than 30 days
after the Company notifies the Trustee of the occurrence of the Release Date.

     In connection with the establishment of the occurrence of the Release Date, the Trustee shall
be entitled to receive, may presume the correctness of, and shall be fully protected in relying
upon, an Officers’ Certificate designating the Release Date and stating that the conditions to the
occurrence of the Release Date have been satisfied.

     When the obligation of the Company to make payments with respect to the principal of, and
premium, if any, and interest on all or any part of the Bonds shall be satisfied or deemed
satisfied pursuant to the Original Indenture or pursuant to this Twenty-Third Supplemental
Indenture, the Trustee shall, upon written request of the Company, deliver to the Company without
charge therefor all of the Bonds so satisfied or deemed satisfied, together with such appropriate
instruments of transfer or release as may be reasonably requested by the Company. All Bonds
delivered to the Company in accordance with this Section shall be delivered by the Company to the
Mortgage Trustee for cancellation.

     SECTION 4.03. Substitute Mortgage Bonds.

     (a) The Company shall notify the Trustee not less than 90 days prior to the Release Date (or
such shorter period as the Company and the Trustee may agree) if the Company has determined to
deliver to the Trustee on the Release Date Substitute Mortgage Bonds in an aggregate principal
amount equal to the aggregate principal amount of Notes and any other Securities subject to the
release provisions Outstanding on the Release Date, in trust for the benefit of the Holders from
time to time of the Notes and any other Securities subject to the release provisions issued under
the Original Indenture, as supplemented, as security for any and all obligations of the Company
under the Notes and any other Securities subject to the release provisions, including but not
limited to, (1) the full and prompt payment of the principal of and premium, if any, on the Notes
and any other Securities subject to the release provisions when and as the same shall become due
and payable in accordance with the terms and provisions of the Original Indenture, as supplemented,
or the Notes or such other Securities subject to the release provisions, either at the stated
maturity thereof, upon acceleration of the maturity thereof or upon redemption, and (2) the full
and prompt payment of any interest on the Notes and any other Securities subject to the release
provisions when and as the same shall become due and payable in accordance with the terms and
provisions of the Original Indenture, as supplemented, or the Notes or such other Securities
subject to the release provisions.

     (b) The Substitute Mortgage Bonds to be delivered pursuant to the notice described in Section
4.03(a) shall be delivered in separate series and issues corresponding to the series and issues of
Notes and other Securities subject to the release provisions Outstanding on the Release Date, each
series or issue of Substitute Mortgage Bonds having the same stated rate or rates of interest (or
interest calculated in the same manner), Interest Payment Dates, stated maturity date and
redemption provisions, and in the same aggregate principal amount, as the related series or issue
of Notes or other Securities subject to the release provisions outstanding on the Release

10

 

Date. The Company shall enter into a Substitute Mortgage for the issuance of Substitute
Mortgage Bonds, and designate it as such in the notice.

     (c) The notice described in Section 4.03(a) shall also state that on the Release Date the
Company shall deliver to the Trustee a supplemental indenture to the Original Indenture that will
provide, among other things, that upon the issuance of Notes and other Securities subject to the
release provisions on or after the Release Date, the Company shall deliver to the Trustee in trust
for the benefit of the Holders as described in Section 4.03(a) hereof, and the Trustee shall accept
therefor, related series of Substitute Mortgage Bonds registered in the name of the Trustee and
conforming to the requirements therein specified.

     (d) The determination whether to deliver Substitute Mortgage Bonds shall be made in the
Company’s sole discretion and without any obligation to do so.

     (e) In the event that the Company does not deliver the notice described in Section 4.03(a),
the Notes and other Securities subject to the release provisions Outstanding on the Release Date
shall, as of the Release Date, no longer be entitled to the benefit of the pledge of the Pledged
Bonds and shall thereafter be general unsecured obligations of the Company.

     (f) Article Four and related provisions of the Original Indenture shall apply to Substitute
Mortgage Bonds pledged to the Trustee hereunder and the provisions thereof shall be deemed to refer
to the Substitute Mortgage and the Substitute Mortgage Bonds. If the Company elects to have the
Notes secured by Substitute Mortgage Bonds on and after the Release Date, Article Four and related
provisions may be amended to make appropriate reference to the Substitute Mortgage and the
Substitute Mortgage Bonds; provided, that the consent of Holders shall not be required in
connection with such amendment.

     SECTION 4.04. Events of Default.

     (a) On and after the Release Date, Section 601(8) of the Original Indenture shall no longer
apply to the Notes.

     For purposes of the Notes, Section 601(8) of the Original Indenture shall read, “the
occurrence of an “event of default” as such term is defined in the Mortgage; or”.

     (b) On and after the Release Date, if the Notes become secured by Substitute Mortgage Bonds
pursuant to Section 4.03 above, the occurrence of an “event of default” (as defined in the
Substitute Mortgage) shall constitute an Event of Default under Section 601 of the Original
Indenture with respect to the Notes and the references in Section 601(4) of the Original Indenture
and related provisions to “Mortgage Bonds” shall be deemed to refer to “Substitute Mortgage Bonds.”

ARTICLE FIVE

MISCELLANEOUS PROVISIONS

     The Trustee makes no undertaking or representations in respect of, and shall not be
responsible in any manner whatsoever for and in respect of, the validity or sufficiency of this

11

 

Twenty-Third Supplemental Indenture or the proper authorization or the due execution hereof by
the Company or for or in respect of the recitals and statements contained herein, all of which
recitals and statements are made solely by the Company.

     Except as expressly amended hereby and by the supplemental indenture appointing the Trustee as
successor trustee, the Original Indenture shall continue in full force and effect in accordance
with the provisions thereof and the Original Indenture is in all respects hereby ratified and
confirmed. This Twenty-Third Supplemental Indenture and all its provisions shall be deemed a part
of the Original Indenture in the manner and to the extent herein and therein provided.

     This Twenty-Third Supplemental Indenture and the Notes shall be governed by, and construed in
accordance with, the laws of the State of New York.

     This Twenty-Third Supplemental Indenture may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all such counterparts shall together
constitute but one and the same instrument.

12

 

     IN WITNESS WHEREOF, the parties hereto have caused this Twenty-Third Supplemental Indenture to
be duly executed and attested, all as of the day and year first above written.

	 	 	 	 	 
	 	THE DETROIT EDISON COMPANY

 	 
	 	By:  	/s/ Paul A. Stadnikia
 	 
	 	Name:  	Paul A. Stadnikia 	 
	 	Title:  	Assistant Treasurer 	 
	 

ATTEST:

	 	 	 	 	 
	By:

	 	/s/ Sandra Kay Ennis
 

	 	 
	Name:

	 	Sandra Kay Ennis	 	 
	Title:

	 	Corporate Secretary	 	 

13

 

	 	 	 	 	 
	 	THE BANK OF NEW YORK TRUST COMPANY,

N.A., as Trustee

 	 
	 	By:  	/s/ J. Michael Banas
 	 
	 	Name:  	J. Michael Banas 	 
	 	Title:  	Vice President 	 
	 

ATTEST:

	 	 	 	 	 
	By: 

Name:

	 	/s/ Alexis M. Johnson
 

Alexis M. Johnson
	 	 
	Title:

	 	Authorized Officer	 	 

14

 

EXHIBIT A

			
	     	 	 
	No. R-___
	 	$                    

THE DETROIT EDISON COMPANY

2008 SERIES DT VARIABLE RATE SENIOR NOTES DUE 2036

Principal Amount: $                    

Authorized Denomination: $1,000

Regular Record Date: Same as the record date for the 2008DT Bonds with respect to the relevant
Interest Payment Date

Original Issue Date: April 11, 2008

Stated Maturity: December 1, 2036

Interest Payment Dates: Such dates as interest shall be payable on the 2008DT Bonds

Interest Rate: Such rate as is established for the 2008DT Bonds from time to time

     THE DETROIT EDISON COMPANY, a corporation duly organized and existing under the laws of the
State of Michigan (the “Company,” which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to the The Bank of New York
Trust Company, N.A., as Bond Trustee, or registered assigns, at the office or agency of the Company
in the City of New York, New York, the principal sum of                                          Dollars
($                    ) on December 1, 2036 (the “Stated Maturity”), in the coin or currency of the United
States, and to pay interest thereon from the Original Issue Date shown above, or from the most
recent Interest Payment Date to which interest has been paid or duly provided for, in arrears on
each Interest Payment Date as specified above, commencing on the first date on which interest is
payable on the 2008DT Bonds, and on the Stated Maturity at the rate per annum shown above (the
“Interest Rate”) until the principal hereof is paid or made available for payment, and on any
overdue principal and premium and on any overdue installment of interest. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Securities) is
registered on the Regular Record Date as specified above next preceding such Interest Payment Date.
This Note is being issued to the Bond Trustee, as assignee of the Michigan Strategic Fund (the
“MSF”), pursuant to the Company’s obligations under the Loan Agreement dated as of April 1, 2008
(the “Loan Agreement”) between the MSF and the Company relating to the Michigan Strategic Fund
Variable Rate Limited Obligation Refunding Revenue Bonds (The Detroit Edison Company Exempt
Facilities Project), Series 2008DT (the “2008DT Bonds”), which are issued under the Trust Indenture
dated as of April 1, 2008 (the “Bond Indenture”) between the MSF and The Bank of New York Trust
Company, N.A., as trustee (the “Bond Trustee”). Except as otherwise provided in the Indenture, any
such interest not so punctually paid or duly provided for will forthwith cease to be payable to the
Holder on such Regular Record Date and may either be paid to the Person in whose name this Note (or
one or more Predecessor Securities) is registered at the

A-1

 

close of business on a Special Record Date for the payment of such defaulted Interest to be
fixed by the Trustee, notice whereof shall be given to Holders of Notes of this series not less
than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner
not inconsistent with the requirements of any securities exchange, if any, on which the Notes of
this series shall be listed, and upon such notice as may be required by any such exchange, all as
more fully provided in the Indenture.

     Payments of interest on this Note will include interest accrued to but excluding the
respective Interest Payment Dates. Interest payments for this Note shall be computed and paid on
the same basis as interest on the 2008DT Bonds pursuant to the Bond Indenture. The Company shall
pay interest on overdue principal and premium, if any, and, to the extent lawful, on overdue
installments of interest at the rate per annum borne by this Note. In the event that any Interest
Payment Date, Redemption Date or Maturity Date is not a Business Day, then the required payment of
principal, premium, if any, and interest will be made on the next succeeding day that is a Business
Day (and without any interest or other payment in respect of any such delay), in each case with the
same force and effect as if made on such date. “Business Day” means any day except a Saturday,
Sunday or other day (i) on which commercial banks located in the cities in which the Principal
Office of the Trustee, the Principal Office of the Company, the Principal Office of the Remarketing
Agent, the Principal Office of the Auction Agent during any Auction Period or the Principal Office
of the Paying Agent, each as defined in the Bond Indenture, are located are required or authorized
by law or regulation to remain closed or are closed, or (ii) on which The New York Stock Exchange
is closed.

     Payment of principal of, premium, if any, and interest on the Notes shall be made in such coin
or currency of the United States of America as at the time of payment is legal tender for payment
of public and private debts. Payments of principal, premium, if any, and interest due at the
Stated Maturity or earlier redemption of such Securities shall be made at the office of the Paying
Agent upon surrender of such Securities to the Paying Agent. Payments of interest shall be made,
at the option of the Company, subject to such surrender where applicable, by check mailed to the
address of the Person entitled thereto as such address shall appear in the Security Register.

     UNTIL THE RELEASE DATE (AS DEFINED BELOW), THIS NOTE SHALL BE SECURED BY GENERAL AND REFUNDING
MORTGAGE BONDS, 2008 SERIES DT (THE “MORTGAGE BONDS”) ISSUED AND DELIVERED BY THE COMPANY TO THE
TRUSTEE (AS DEFINED BELOW) UNDER THE COMPANY’S SUPPLEMENTAL INDENTURE DATED AS OF APRIL 1, 2008,
SUPPLEMENTING THE MORTGAGE AND DEED OF TRUST DATED AS OF OCTOBER 1, 1924 BETWEEN THE COMPANY AND
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION (THE “MORTGAGE TRUSTEE”), PLEDGED BY THE COMPANY
FOR THE BENEFIT OF THE HOLDERS OF THE NOTES TO THE TRUSTEE UNDER THE INDENTURE (THE “MORTGAGE”).
ON THE RELEASE DATE, THE NOTES SHALL CEASE TO BE SECURED BY SUCH MORTGAGE BONDS AND, AT THE
COMPANY’S OPTION, SHALL EITHER (1) BECOME UNSECURED GENERAL OBLIGATIONS OF THE COMPANY OR (2) BE
SECURED BY SUBSTITUTE MORTGAGE BONDS UNDER A SUBSTITUTE MORTGAGE.

     Unless the Certificate of Authentication hereon has been executed by the Trustee or a duly
appointed Authentication Agent referred to herein, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.

A-2

 

     This Note is one of a duly authorized series of Securities of the Company (herein sometimes
referred to as the “Notes”), specified in the Indenture, all issued or to be issued in one or more
series under and pursuant to a Collateral Trust Indenture dated as of June 30, 1993 (the “Original
Indenture”) duly executed and delivered between the Company and The Bank of New York Trust Company,
N.A., as successor Trustee (herein referred to as the “Trustee”), as supplemented through and
including a Twenty-Third Supplemental Indenture dated as of April 1, 2008 (together with the
Original Indenture, the “Indenture”) between the Company and the Trustee, to which Indenture and
all indentures supplemental thereto reference is hereby made for a description of the respective
rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the registered Holders of the Notes and of the terms upon which the Notes are, and are
to be, authenticated and delivered.

     The Notes are not subject to repayment at the option of the Holders thereof and are not
subject to any sinking fund, except to the extent that the Bond Trustee, or its successor in
interest, may have exercised its rights pursuant to Section 2.03 of the aforesaid Twenty-Third
Supplemental Indenture. The Notes are subject to Optional Redemption and Extraordinary Optional
Redemption, as a whole or in part, and Special Optional Redemption, in whole, by the Company prior
to Stated Maturity of the principal thereof upon the same terms as the 2008DT Bonds are subject to
redemption. Upon payment of the principal or premium, if any, on the 2008DT Bonds, whether at
maturity or prior to maturity by redemption or otherwise, or upon provision for the payment thereof
having been made in accordance with Article IV or VIII of the Bond Indenture, or upon payment of
interest on the 2008DT Bonds, Notes in a principal amount equal to the principal amount of the
2008DT Bonds so paid, or interest on Notes in an amount equal to the interest on the 2008DT Bonds
so paid, as the case may be, shall, to the extent of such payment, be deemed fully paid and the
obligation of the Company thereunder to make such payment shall forthwith cease and be discharged,
and, in the case of the payment of principal and premium, if any, such Notes shall be surrendered
for cancellation or presented for appropriate notation to the Trustee.

     Notwithstanding the foregoing, installments of interest on this Note that are due and payable
on Interest Payment Dates falling on or prior to a Redemption Date will be payable on the Interest
Payment Date to the registered Holders as of the close of business on the relevant Record Date.

     Notice of any Optional, Extraordinary Optional or Special Optional Redemption will be mailed
at least 30 days but not more than 60 days before the Optional, Extraordinary Optional or Special
Optional Redemption Date, as the case may be, to the Holder hereof at its registered address.

     Unless the Company defaults in payment of the applicable Redemption Price, on and after the
applicable Redemption Date interest will cease to accrue on the principal amount of this Note
called for redemption.

     If money sufficient to pay the applicable Redemption Price with respect to the principal
amount of and accrued interest on the principal amount of this Note to be redeemed on the
applicable Redemption Date is deposited with the Trustee or Paying Agent on or before the related
Redemption Date and certain other conditions are satisfied, then on or after such date, interest
will cease to accrue on the principal amount of this Note called for redemption.

A-3

 

     If the Company elects to redeem all or a portion of the Notes, the redemption will be
conditional upon receipt by the Paying Agent or the Trustee of monies sufficient to pay the
Redemption Price. If the Notes are only partially redeemed by the Company, the Trustee shall
select which Notes are to be redeemed in a manner it deems fair and appropriate in accordance with
the terms of the Indenture.

     In the event of redemption of this Note in part only, a new Note or Notes of this series for
the unredeemed portion hereof will be issued in the name of the registered Holder hereof upon the
cancellation hereof.

     In case an Event of Default, as defined in the Indenture, shall have occurred and be
continuing, the principal of all of the Notes may be declared, and upon such declaration shall
become, due and payable, in the manner, with the effect and subject to the conditions provided in
the Indenture.

     The Indenture contains provisions for defeasance at any time of the entire indebtedness of
this Note upon compliance by the Company with certain conditions set forth therein. In the event
the Company desires to provide for the payment of Notes, in lieu of defeasing the Notes in
accordance with the Indenture, the Company shall either redeem an equal principal amount of 2008DT
Bonds or take such action as shall be required by the Bond Indenture to defease an equal principal
amount of 2008DT Bonds.

     Any amount payable by the Company in respect of principal of the Notes, whether at maturity or
prior to maturity by redemption or otherwise, in a circumstance where there has not been a
corresponding payment of principal of 2008DT Bonds, shall be applied simultaneously to the
redemption or defeasance of any equal principal amount of 2008DT Bonds in accordance with the Bond
Indenture.

     The Indenture contains provisions permitting the Company and the Trustee, with the consent of
the registered Holders of not less than a majority in aggregate principal amount of the outstanding
Securities of each series affected at the time, as defined in the Indenture, to execute
supplemental indentures for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of any supplemental indenture or of modifying
in any manner the rights of the registered Holders of the Securities; provided, however, that no
such supplemental indenture shall (i) extend the fixed maturity of any Securities of any series, or
reduce the principal amount thereof, or reduce the rate of or extend the time of payment of
interest thereon, or reduce any premium payable upon the redemption thereof, without the consent of
the registered Holder of each Security so affected or (ii) reduce the aforesaid percentage of
Securities, the registered Holders of which are required to consent to any such supplemental
indenture, without the consent of the registered Holders of each Security then outstanding and
affected thereby. The Indenture also contains provisions permitting (i) the registered Holders of
at least 66 2/3% in aggregate principal amount of the Securities of all series at the time
outstanding affected thereby, on behalf of the registered Holders of the Securities of such series,
to waive compliance by the Company with certain provisions of the Indenture and (ii) the registered
Holders of a majority in aggregate principal amount of the Securities of all series at the time
outstanding affected thereby, on behalf of the registered Holders of the Securities of such series,
to waive certain past defaults under the Indenture and their consequences. Any such consent or
waiver by the registered Holder of this Note (unless revoked as provided in the Indenture) shall be
conclusive and binding upon such registered Holder and upon all future

A-4

 

registered Holders and owners of this Note and of any Note issued in exchange hereof or in
place hereof (whether by registration of transfer or otherwise), irrespective of whether or not any
notation of such consent or waiver is made upon this Note.

     No reference herein to the Indenture and no provision of this Note or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and unconditional, to pay the
principal of and interest on this Note at the time and place and at the rate and in the coin or
currency herein prescribed.

     Prior to the Release Date, the Notes of this series shall be secured by a series of Mortgage
Bonds (the “Related Series of Bonds”), delivered by the Company to the Trustee for the benefit of
the Holders of the Notes. Reference is made to the Mortgage and the Indenture for a description of
the rights of the Trustee as Holder of the Related Series of Bonds, the property mortgaged and
pledged under the Mortgage and the rights of the Company and of the Mortgage Trustee in respect
thereof, the duties and immunities of the Mortgage Trustee and the terms and conditions upon which
the Related Series of Bonds are secured and the circumstances under which additional Mortgage Bonds
may be issued.

     FROM AND AFTER SUCH TIME AS ALL BONDS, OTHER THAN (1) PLEDGED BONDS, INCLUDING THE RELATED
SERIES OF BONDS, AND (2) MORTGAGE BONDS (EXCLUSIVE OF PLEDGED BONDS) WHICH DO NOT IN AGGREGATE
PRINCIPAL AMOUNT EXCEED THE GREATER OF FIVE PERCENT (5%) OF NET TANGIBLE ASSETS OR FIVE PERCENT
(5%) OF CAPITALIZATION, HAVE BEEN RETIRED THROUGH PAYMENT, REDEMPTION OR OTHERWISE (INCLUDING THOSE
MORTGAGE BONDS THE PAYMENT FOR WHICH HAS BEEN PROVIDED FOR IN ACCORDANCE WITH THE MORTGAGE) AT,
BEFORE OR AFTER THE MATURITY THEREOF, PROVIDED THAT NO DEFAULT OR EVENT OF DEFAULT HAS OCCURRED AND
IS CONTINUING (THE “RELEASE DATE”), THE RELATED SERIES OF BONDS SHALL CEASE TO SECURE THE NOTES IN
ANY MANNER.

     As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Note is registrable in the Security Register of the Company, upon surrender of
this Note for registration of transfer at the office or agency of the Company in any place where
the principal of and any interest on this Note are payable or at such other offices or agencies as
the Company may designate, duly endorsed by or accompanied by a written instrument or instruments
of transfer in form satisfactory to the Company and the Security Registrar or any transfer agent
duly executed by the registered Holder hereof or his or her attorney duly authorized in writing,
and thereupon one or more new Notes of this series and of like tenor, of authorized denominations
and for the same aggregate principal amount will be issued to the designated transferee or
transferees. No service charge will be made for any such transfer, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge payable in relation
thereto.

     Prior to due presentment for registration of transfer of this Note, the Company, the Trustee,
any Paying Agent and any Note Registrar may deem and treat the registered Holder hereof as the
absolute owner hereof (whether or not this Note shall be overdue and notwithstanding any notice of
ownership or writing hereon made by anyone other than the Note Registrar) for the purpose of
receiving payment of or on account of the principal hereof and

A-5

 

interest due hereon and for all other purposes, and neither the Company nor the Trustee nor
any Paying Agent nor any Security Registrar shall be affected by any notice to the contrary.

     As set forth in, and subject to the provisions of, the Indenture, no Holder of any Note will
have any right to institute any proceeding with respect to the Indenture or for any remedy
thereunder, unless (i) such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default with respect to the Notes of this series, (ii) the Holders of not less
than 25% in principal amount of the outstanding Notes of this series shall have made written
request, and offered reasonable indemnity, to the Trustee to institute such proceeding as trustee,
(iii) the Trustee shall have failed to institute such proceeding within 60 days and (iv) the
Trustee shall not have received from the Holders of a majority in principal amount of the
outstanding Notes of this series a direction inconsistent with such request within such 60-day
period; provided, however, that such limitations do not apply to a suit instituted by the Holder
hereof for the enforcement of payment of the principal of or any interest on this Note on or after
the respective due dates expressed herein.

     All terms used in this Note which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.

A-6

 

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

	 	 	 	 	 	 	 
	 	 	THE DETROIT EDISON COMPANY
	 
	 	 	 	 	 	 
	[Corporate Seal]
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

ATTEST:

	 	 	 	 	 
	By:
	 	 	 	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 

A-7

 

CERTIFICATE OF AUTHENTICATION

     This is one of the Notes of the series of Notes described in the within mentioned Indenture.

	 	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK TRUST
COMPANY, N.A.

as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Authorized Signatory
	 	 

Date:                    

A-8

 

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto

	 	 	 	 	 
	 
	 

	 	 

(Please insert Social Security or Other Identifying Number of Assignee)
	 	 
	 
	 

	 	 

(Please print or type name and address, including zip code of assignee)
	 	 

the within Note and all rights thereunder, hereby irrevocably constituting and appointing such
person attorneys to transfer the within Note on the books of the Issuer, with full power of
substitution in the premises.

Dated:                                         

     NOTICE: The signature of this assignment must correspond with the name as written upon the
face of the within Note in every particular, without alteration or enlargement or any change
whatever and NOTICE: Signature(s) must be guaranteed by a financial institution that is a member of
the Securities Transfer Agents Medallion Program (“STAMP”), the Stock Exchange, Inc. Medallion
Signature Program (“MSP”). When assignment is made by a guardian, trustee, executor or
administrator, an officer of a corporation, or anyone in a representative capacity, proof of his or
her authority to act must accompany this Note.

A-9exv10w43

Exhibit 10-43

AMENDMENT AND WAIVER AGREEMENT

          AMENDMENT AND WAIVER AGREEMENT dated as of May 8, 2008 among THE DETROIT EDISON COMPANY, a
Michigan corporation (the “Seller”), CAFCO, LLC, a Delaware limited liability company
(“CAFCO”), CITIBANK, N.A., a national banking association (“Citibank”) and CITICORP
NORTH AMERICA, INC., a Delaware corporation, individually (“CNAI”) and as agent (the
“Agent”).

          Preliminary Statements. (1) (A) The Seller, CAFCO, Citibank and CNAI, individually and
as Agent, are parties to a Trade Receivables Purchase and Sale Agreement, dated as of February 28,
1989, as amended and restated as of October 1, 1991, and as further amended and restated as of
March 9, 2001, as further amended (the “RPA”) and (B) the Seller, Citibank and CNAI,
individually and as Agent are parties to the Trade Receivables Purchase and Sale Agreement, dated
as of February 28, 1989, as amended and restated as of October 1, 1991, as further amended (the
“Citibank Agreement”, together with the RPA, the “Agreements”; capitalized terms
not otherwise defined herein shall have the meanings attributed to them in the Agreements) pursuant
to which CAFCO has purchased certain Eligible Assets from the Seller;

          (2) The Seller, the Investor, Citibank and CNAI, individually and as Agent, desire to, among
other things, amend the Agreements to change the margin set forth in the definition of Assignee
Rate or Citibank Rate, as the case may be, and to amend the fees set forth in the letter agreements
dated as of January 24, 2002 referred to in Section 2.10(a) of each of the Agreements (the “Fee
Letters”).

          (3) The Seller, the Investor, Citibank and CNAI, individually and as Agent, also desire to
waive certain Events of Investment Ineligibility or Events of Termination, as the case may be,
which have or may have occurred.

          NOW, THEREFORE, the parties agree as follows:

          SECTION 1. Amendments to Agreements. Effective as of the date hereof (unless
otherwise set forth herein) and upon compliance with the terms and conditions of Section 4 of this
Amendment and Waiver Agreement:

          (a) Section 1.01 of each of the Agreements is amended as follows:

     (i) as of July 1, 2008, the definition of “Assignee Rate” in the RPA and of
“Citibank Rate” in the Citibank Agreement are amended by deleting the percentage
“1.25%” where it appears in clause (y) thereof and replacing it with the percentage
“2.25%”.

 

 

     (ii) New definitions are added which read in their entirety as follows:

     “Accounting Based Consolidation Event” means the consolidation, for
financial and/or regulatory accounting purposes, of all or any portion of the assets
and liabilities of the Investor that are the subject of this Agreement, the Asset
Purchase Agreement or any other Transaction Document with all or any portion of the
assets and liabilities of the Affected Person (other than the Investor) as the
result of the existence of, or occurrence of any change in, accounting standards or
the issuance of any pronouncement, interpretation or release, including, without
limitation, the Financial Accounting Standards Board Interpretation No. 46, by any
accounting body or any other body charged with the promulgation or administration of
accounting standards, including, without limitation, the Financial Accounting
Standards Board, the International Accounting Standards Board, the American
Institute of Certified Public Accountants, the Federal Reserve Board of Governors
and the Securities and Exchange Commission, and shall occur as of the date that such
consolidation (i) shall have occurred with respect to the financial statements of
the applicable Affected Person or (ii) shall have been required to have occurred,
regardless of whether such financial statements were prepared as of such date.

     “Asset Purchase Agreement” shall have the meaning assigned to that term
in Section 2.11(c).

     “Transaction Document” shall have the meaning assigned to that term in
Section 2.11(c).

	 	(b)	 	A new Section 2.11(c) is added to each of the Agreements which
reads in its entirety as follows:

     (c) If an Affected Person determines that compliance with any applicable law or
request from any central bank or other authority charged with the interpretation or
administration thereof (whether or not having the force of law) or the occurrence of
any Accounting Based Consolidation Event after May 8, 2008 (i) affects or would
affect the amount of capital required or reasonably expected to be maintained by
such Affected Person and that the amount of such capital is increased by or based
upon the existence of such Affected Person’s commitment under this Agreement and all
other instruments and documents to be delivered hereunder (the “Transaction
Documents”) or any agreement pursuant to which liquidity is provided to the
Investor (an “Asset Purchase Agreement”) or upon such Affected Person’s
purchasing or maintaining the ownership of Eligible Assets, (ii) increases the cost
of making or maintaining such commitment under the Transaction Documents or any

2

 

Asset Purchase Agreement or purchasing or maintaining the ownership of Eligible
Assets to any Affected Person or (iii) reduces the return of an Affected Person in
connection with the Transaction Documents or any Asset Purchase Agreement, then,
upon written demand of such Affected Person (with a copy of such demand to the
Agent), the Seller shall immediately pay to the Agent for the account of such
Affected Person, from time to time as specified by such Affected Person, additional
amounts sufficient to compensate such Affected Person for such increased cost and/or
reduced return in light of such circumstances. A certificate setting forth in
reasonable detail such amounts and the circumstances giving rise thereto submitted
to the Seller by such Affected Person shall be conclusive and binding for all
purposes, absent manifest error.

          SECTION 2. Amendments to Fee Letters. As of July 1, 2008, each of the Fee Letters is
amended by deleting the fraction “20/100” where it appears in clause (i) and the fraction
“17.5/100” where it appears in clause (ii) and replacing them, respectively, with the fractions
“25/100” and “50/100”.

          Clause (i) of the Fee Letter relating to the RPA is further amended by the addition of the
following paragraph which reads in its entirety as follows:

     If an Accounting Based Consolidation Event shall occur with respect to the
Investor and any Affected Person (other than the Investor), then from and after
written notification thereof from the Agent, the Administration Fee rate payable by
the Seller shall be, instead of the Administration Fee rate pursuant to the prior
paragraph, a rate equal to (i) the percentage rate set forth in clause (y) of the
definition of Assignee Rate, minus (ii) the Program Fee rate.

          SECTION 3. Waiver. The Agent understands that as of the last day of March 2008, the
Default-to-Delinquency Ratio exceeded 60%, and, therefore, (i) an Event of Investment Ineligibility
under Section 7.01(h) of the RPA has occurred and (ii) Events of Termination under Sections 7.01(f)
and 7.01(i) of the Citibank Agreement have occurred and that for an unspecified period of time
prior to the last day of March 2008, one or more Investor Reports may have inadvertently been
inaccurate and the Default-to-Delinquency Ratio may have exceeded 60%, and therefore, (iii) Events
of Investment Ineligibility under Sections 7.01(c) and 7.01(h) of the RPA may have occurred and
(iv) Events of Termination under Sections 7.01(c), 7.01(f) and 7.01(i) of the Citibank Agreement
may have occurred (the said Events of Investment Ineligibility and Events of Termination being
hereinafter referred to as the “Events”).

          The Agent agrees that, notwithstanding the occurrence of the Events described in the prior
paragraph or any Events subsequent to the last day of March 2008 which have occurred or may occur
under Section 7.01(h) of the RPA or

3

 

          Sections 7.01(f) and 7.01(i) of the Citibank Agreement on or prior to September 30, 2008
(collectively, the “Specified Events”), (i) the Agent shall not, prior to September 30,
2008, declare the Facility Termination Date or the Commitment Termination Date, as the case may be,
to have occurred pursuant to Section 7.01 of each of the Agreements as a result solely of the
occurrence of a Specified Event, (ii) no Provisional Liquidation Day shall be deemed to have
occurred under the Agreements, prior to September 30, 2008, as a result solely of the occurrence of
a Specified Event, (iii) the Agent shall not, prior to September 30, 2008, exercise its rights
under Section 6.03(a) of each of the Agreements as a result solely of the occurrence of a Specified
Event, and (iv) prior to September 30, 2008, Specified Events shall be disregarded in determining
whether the Seller (A) may extend the maturity or adjust the Outstanding Balance of any Defaulted
Receivables pursuant to the second to last sentence of Section 6.02(a) of each of the Agreements
and (B) shall comply with the provisions of Section 5.02(e) of the Agreements with respect thereto.
The Seller, the Investor, Citibank and the Agent agree that on or after September 30, 2008 the
Agent may declare the Facility Termination Date and/or the Commitment Termination Date, as the case
may be, to have occurred under the Agreements as a result of the occurrence of any Specified Event,
regardless of whether or not the Default-to-Delinquency Ratio for the most recent month (or for any
month prior thereto) exceeded 60%.

          This Amendment and Waiver Agreement shall not be deemed to be a waiver of (i) any other Event
or any event which would constitute an Event but for the requirement that notice be given or time
elapse or both (an “Incipient Event”) which may now or hereafter exist under the Agreements
or (ii) except as provided in the preceding paragraph, any Specified Event. Nothing in this
Amendment and Waiver Agreement shall prejudice the Agent’s right to exercise at any time any
rights, remedies, powers, claims or causes of action now or hereafter available under the
Agreements as a result of any past, present or future Event or Incipient Event (including, except
as provided in the preceding paragraph, any Specified Event). The Agent hereby specifically
reserves all of its rights, remedies, powers, claims and causes of action under the Agreements and
under applicable law, all of which rights, remedies, powers, claims and causes of action are
cumulative.

          SECTION 4. Conditions Precedent. The terms and provisions of this Amendment and
Waiver Agreement shall become effective upon the execution and delivery of five (5) counterparts
hereof by the parties hereto.

          SECTION 5. Confirmation of Agreements and Fee Letters. Except as herein expressly
amended, each of the Agreements and the Fee Letters is ratified and confirmed in all respects and
shall remain in full force and effect in accordance with its terms. Each reference in the
Agreements and the Fee Letters to “this Agreement” shall mean the relevant Agreement or Fee Letter
as amended by this Amendment and Waiver Agreement, and as hereafter amended or restated.

4

 

          SECTION 6. GOVERNING LAW. THIS AMENDMENT AND WAIVER AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT THE
VALIDITY OR PERFECTION OF THE INTERESTS OF THE OWNERS IN THE RECEIVABLES, OR REMEDIES HEREUNDER, IN
RESPECT THEREOF ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.

          SECTION 7. Execution in Counterparts. This Amendment and Waiver Agreement may be
executed in any number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of which when taken
together shall constitute one and the same Agreement. Delivery of an executed counterpart of a
signature page to this Amendment and Waiver Agreement by telecopier shall be effective as delivery
of a manually executed counterpart of this Amendment and Waiver Agreement.

          SECTION 8. Seller’s Representations and Warranties. The Seller represents and
warrants that this Amendment and Waiver Agreement has been duly authorized, executed and delivered
by the Seller pursuant to its corporate powers and constitutes the legal, valid and binding
obligation of the Seller.

[Remainder of this page intentionally left blank]

5

 

     IN WITNESS WHEREOF, the parties have caused this Amendment and Waiver Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first above written.

	 	 	 	 	 
	 	THE DETROIT EDISON COMPANY

 	 
	 	By:  	/s/ David R. Murphy
 	 
	 	 	Title: Assistant Treasurer 	 
	 	 	 	 
	 
	 	CAFCO, LLC

 	 
	 	By:  	CITICORP NORTH AMERICA, INC.,
 	 
	 	 	as Attorney-in-Fact 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	     /s/ Raymond F. Dizon
 	 
	 	 	Vice President 	 
	 	 	 	 
	 
	 	CITICORP NORTH AMERICA, INC.,

individually and as Agent

 	 
	 	By:  	/s/ Raymond F. Dizon
 	 
	 	 	Vice President 	 
	 	 	 	 
	 
	 	CITIBANK N.A.

 	 
	 	By:  	/s/ Raymond F. Dizon
 	 
	 	 	Vice President 	 
	 	 	 	 
	 

6

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