Document:

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                                                                   Exhibit 10.23

                                AGENCY AGREEMENT

This Agency Agreement (the "Agreement") is hereby entered into and made
effective as of the 1st day of January, 2003 ("Effective Date"), by and between
Meadowbrook, Inc., Preferred Insurance Agency, Inc., TPA Insurance Agency, Inc.,
Preferred Comp Insurance Agency of New Hampshire, TPA Insurance Agency of New
Hampshire, Inc., Meadowbrook of Nevada, Inc. d/b/a Meadowbrook Insurance
Services, Meadowbrook of Florida, Inc., Association Self-Insurance Services,
Inc., Florida Preferred Administrators, Inc., Interline Insurance Services,
Inc., Commercial Carriers Insurance Agency, Inc., (hereinafter collectively
referred to as the "Agent"), and Star Insurance Company, Savers Property &
Casualty Insurance Company, Williamsburg National Insurance Company and
Ameritrust Insurance Corporation (hereinafter collectively referred to as the
"Company").

In consideration of the mutual covenants and benefits set forth in this
Agreement and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged and accepted, the Agent and the Company agree as
follows:

1.    APPOINTMENT AND AUTHORITY OF THE AGENT

The Agent's authority under this Agreement shall extend only to the states
specifically authorized by the Company and in which the Agent has the
appropriate licenses to transact such business with the Company. The Company
hereby appoints the Agent as the Company's non-exclusive agent and the Agent
acknowledges the Company may appoint other agents to represent the Company or
any of its affiliated companies.

The Company hereby appoints and provides limited authority to the Agent to
solicit and secure applications for the Company and:

            [X] the Agent is granted binding authority, pursuant to the
            Company's underwriting guidelines, policies, bulletins, or other
            documents, which the Company may amend from time to time.

The Agent shall have no authority, nor shall Agent represent itself as having
any authority, other than as specifically provided for in this Agreement.

2.    INDEPENDENT CONTRACTOR

The Agent is an independent contractor. Subject to the terms and conditions of
this Agreement, the Agent shall be free to exercise its own judgement and
discretion with regard to the conduct of its business and as to the persons from
whom the Agent will solicit insurance business. Nothing contained in this
Agreement shall be construed to create between the Company and the Agent the
relationship of employer and employee, joint venture, or partnership. The
Company may, from time to time, prescribe rules and regulations relating to the
conduct of business covered by this Agreement, which rules and regulations shall
be observed and conformed to by the Agent.

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3.    AGENCY EXPENSES

The Company shall not be responsible for the Agent's expenses in connection with
the solicitation of insurance or performance of any duties or obligations of the
Agent under this Agreement, unless previously agreed to in writing by the Agent
and the Company.

4.    DUTIES AND RESPONSIBILITIES OF THE AGENT

The Agent will perform all of its duties under this Agreement to the
satisfaction of the Company, which duties and responsibilities shall include,
but not be limited to, the following:

      a.    The Agent agrees to timely comply with all licensing,
            countersignature or other similar requirements of any jurisdiction
            in which insurance is written or risks are located;

      b.    The Agent will comply with all instructions, rules, bulletins,
            manuals, forms, underwriting guidelines and rates issued by the
            Company, which may be amended from time to time by the Company.
            Also, the Company reserves the right to establish and change any
            procedures from time to time;

      c.    The Agent will forward to the Company all applications, binders or
            requests for policy changes, and report all insurance accepted and
            bound no later than ten (10) days following the effective date of
            the insurance coverage. Failure to comply may result in the
            immediate suspension of any underwriting authority granted to the
            Agent by the Company;

      d.    The Agent will promptly deliver, and as directed by the Company,
            execute or countersign insurance policies, binders, certificates of
            insurance and endorsements as directed by the Company;

      e.    The Agent will ensure that all premiums and rates for policies are
            charged in full compliance with rate filings of the Company;

      f.    The Agent will retain complete and accurate records pertaining to
            business transacted on behalf of the Company. The Agent shall retain
            all underwriting information that is required by law and copies of
            any other relevant documents for audit and review by the Company;

      g.    The Agent agrees to assume full responsibility for the acts or
            omissions of any employees of the Agent, to the extent that such
            acts or omissions affect the Company. The Agent agrees to advise
            each employee of the limitations of authority placed upon the Agent
            by the Company under this Agreement;

      h.    The Agent represents and warrants to the Company the Agent and its
            employees, if any, are properly licensed to solicit and service any
            business submitted to the Company. The Agent shall provide the
            Company with copies of all licenses required of the Agent by all
            regulatory authorities having jurisdiction over the Agent and its
            employees. The Agent shall maintain all such licenses throughout the
            term of this Agreement. In the event the Agent, or any of its
            employees, shall have their licenses terminated, revoked, suspended,
            lapsed or otherwise not remain in good standing for any reason,

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            the Agent shall advise the Company in writing of such event within
            five (5) days from the date the Agent is provided notice of such
            event;

      i.    The Agent is responsible to perform the duties assumed under this
            Agreement in accordance with the standards of performance of such
            duties that exist in the insurance industry. The Agent agrees that
            it will maintain or, if needed, add sufficient personnel with the
            required expertise and capabilities to fulfill its obligations under
            this Agreement and will maintain or, if needed, add equipment to
            meet the duties it assumes under this Agreement. To the extent
            applicable, the Agent warrants and represents that all of the
            Agent's computer systems and software are compatible with the
            Company's approved rating and policy issuance systems.

      j.    Where applicable, the Agent agrees to be available and make their
            personnel available for education and training in the use of any of
            the Company's applicable systems;

      k.    The Agent assumes responsibility to promptly notify the Company of
            any insured claim of which the Agent has any direct or indirect
            knowledge; and

      l.    The Agent will notify the Company in a timely manner to cancel any
            policy for non-payment of premium. Failure to notify the Company in
            a timely manner will result in the Agent being responsible for any
            uncollectible earned premiums.

5.    LIMITATIONS ON AGENT'S AUTHORITY

The Agent shall have no authority, nor shall it represent itself to have any
authority other than as specifically provided for in this Agreement. Agent shall
not perform any of the following acts:

      a.    Make, waive, alter, or change any term, rate or condition stated in
            any policy of insurance or Company approved form or rate, without
            the prior written consent of the Company;

      b.    Extend the time for payment of premiums or other monies due to the
            Company, unless authorized in writing by the Company;

      c.    Transact business contrary to the rules and regulations of any
            insurance department and/or other governmental authorities having
            jurisdiction over any actions performed under this Agreement;

      d.    Make, accept or endorse notes or checks payable to the Company, or
            otherwise incur any expense or liability on behalf of the Company,
            unless authorized in writing by the Company;

      e.    Enter into a sub-agent, broker, or other agreement which authorizes
            the sub-agent, broker, or other party to perform any act, affecting
            any term or condition of this Agreement; or

      f.    Back date the effective date of coverage of any binder or policy.

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6.    AGENT'S COMPENSATION

The Agent's sole compensation from the Company shall be limited to a commission
calculated as a percentage of premiums and audit premiums written and received
by the Company under this Agreement, as set forth in Addendum I. The Agent shall
deduct its commission on such business written from the premium remitted to the
Company based on either the Company or Agent account current. Premium taxes and
surcharges are not included as premium and therefore, are not subject to
commission. The Company shall charge, and the Agent shall pay, a return
commission at the same rate on any return premium, audit premium and return
premiums on cancellations effectuated by the Company or the policyholder.

7.    PREMIUM TRUST REQUIREMENTS

The Agent shall collect and timely pay for all premiums due the Company for
business written under this Agreement. The Agent shall hold in trust all
premiums received by the Agent in a fiduciary capacity for and on behalf of the
Company. All premiums paid by the policyholders to the Agent shall be deposited
in a trust account of a federally chartered bank, be segregated from the
operating account(s) of the Agent and shall be paid over to the Company in
accordance with Section 9. The Agent agrees to provide the Company with the
identity of the federally chartered bank and trust account number on inception
of this Agreement, on each anniversary thereafter and if any changes are made to
the premium trust account. Furthermore, the Agent agrees to allow the Company
the right to audit the premium trust account.

8.    OWNERSHIP OF EXPIRATIONS

In the event this Agreement is terminated and the Agent has paid to the Company
all premiums due before the effective date of termination, the Agent's
expirations, records, files, related information and the use and control of the
expirations shall remain the property of the Agent and be left in its undisputed
possession. If such premium has not been fully accounted for and paid by the
Agent to the Company prior to the effective date of termination, then the
records, expirations, files, related information and use and control thereof
shall be owned and controlled by the Company.

9.    PREMIUM BILLING AND UNCOLLECTIBLE PREMIUM

The Agent and Company agree to account for and pay all premium balances in
accordance with the following established procedure:

      [X] The Agent shall submit to the Company by the 10th of each month an
account current indicating all of the previous months premium and
taxes/surcharges due, in accordance with the terms and payment plans associated
with each policy. All premiums (including any audit premiums) from the account
current shall be paid to the Company, regardless of whether the Agent has
collected it from the policyholder. The premium, net of commissions, shall be
received by the Company by:

                     [ ] the last calendar day of each month
                                       or;
               [X] the fifteenth (15) day of the following month.

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Failure by the Agent to submit their account current and/or the required premium
payment to the Company by the above stated due dates, the Agent shall be charged
a late penalty calculated at an interest rate of nine percent (9.0%) on the
outstanding premium balance due the Company for each day the payment is late. In
addition, the Agent's authority to solicit and place business under this
Agreement shall be suspended until the premium payment, including any late fees,
is received by the Company. Further, if Agent is delinquent in remitting
premiums due to Company, any and all monies due the Agent will be applied
against any premium the Agent is delinquent in remitting to the Company.

The Agent is responsible for billing and collecting from the policyholder, all
deposit, installment, endorsement and audit premiums and remitting net of
commission to the Company. The Agent shall not be entitled to take credits on
their account current for any transactions that have not yet been processed by
the Company.

The Agent shall be relieved of the responsibility to pay premiums developed by
any premium audit, subject to all of the following conditions:

1.    The Agent has made a good faith effort to collect such audit premiums.

2.    The Agent shall submit to the Company an executed Uncollectible Audit
      Premium Form (the "Audit Form"). The Audit Form shall be submitted by the
      Agent to the Company within seventy-five (75) days from the audit
      statement date. If the Audit Form is submitted timely, the Agent shall be
      relieved of collection responsibility, not be entitled to any commission
      and shall cease any further collection efforts.

3.    The failure by the Agent to submit an executed Audit Form within the
      seventy-five (75) day period shall constitute an election by Agent to
      retain responsibility for payment of such audit premium in accordance with
      the terms of this Agreement.

4.    The Agent agrees to cooperate with the Company in any and all collection
      efforts.

              ALL PREMIUM PAYMENTS AND AUDIT FORMS MUST BE SENT TO:

                                  P.O. BOX 5002
                            SOUTHFIELD, MI 48034-5002
                            ATTN: ACCOUNTS RECEIVABLE

10.   TERM

This Agreement shall remain in effect, unless terminated pursuant to Section 16
of this Agreement.

11.   ERRORS AND OMISSIONS INSURANCE AND FIDELITY INSURANCE

The Agent agrees to maintain an errors and omissions insurance policy during the
term of this Agreement and for a period of twelve (12) months thereafter or
until all policies have either been cancelled or non-renewed, in an amount not
less than:

                [X] Two Million Dollars ($2,000,000.00) per claim
             and Two Million Dollars ($2,000,000.00) per aggregate.

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If the Agent is insured by a claims-made coverage form, the retroactive date of
the policy must be the same date or an earlier date, as the Effective Date of
this Agreement.

If the Agent's aggregate limit is reduced below Two Million Dollars
($2,000,000.00) due to payment of claim(s), the Agent must notify the Company
within ten (10) days and immediately pursue reinstatement of the aggregate limit
to at least the minimum requirement of Two Million Dollars ($2,000,000.00)
aggregate.

The Agent agrees to provide the Company with a Certificate of Insurance
verifying the existence of errors and omissions coverage upon inception of this
Agreement and every anniversary thereafter. Further, the Agent agrees to provide
the Company with ten (10) days advance written notice of termination,
cancellation, or change in such policy by either the insurance carrier or the
Agent.

The Agent agrees to maintain an Employee Dishonesty insurance policy during the
term of this Agreement or until all policies have either been cancelled or
non-renewed, in an amount not less than:

                 [X] Five Hundred Thousand Dollars ($500,000.00)

The Agent agrees to provide the Company with a Certificate of Insurance
verifying the existence of employee dishonesty coverage upon the inception of
this Agreement and every anniversary thereafter. Further, the Agent agrees to
provide the Company with ten (10) days advance written notice of termination,
cancellation, or change in such policy by either the insurance carrier or the
Agent.

12.   FINANCIAL STATEMENT

Upon request by the Company, the Agent hereby agrees to furnish the Company with
annual copies of the Agent's latest audited financial statement, or if not
audited, copies signed by an officer of the Agent. When requested by the
Company, the Agent agrees to provide such statements within ninety (90) days of
the end of the Agent's fiscal year.

13.   ADVERTISING

Except as otherwise provided herein, any use of the Company's name, or any of
its Trademarks or Service Marks (the "Marks") by the Agent for advertising
purposes is prohibited without the prior written consent of the Company for such
use. The Agent shall not make, publish, issue or insert, or cause to have made,
published, issued or inserted any advertisement, letter, circular, pamphlet, or
other publication or statement, whether written or through electronic media,
which makes reference to the Company or any of its policies or services, or
which refer to the insurance written under this Agreement (collectively, the
"Materials"), without the prior written approval of the Company. If at any time
during the term of this Agreement, the Agent, its employees or its
representatives shall commit any act which brings those parties into public
disrepute, contempt, scandal or ridicule or which shocks or offends the
community or which reflects unfavorably upon the Company, or if such parties
have so acted in the past and information in regard thereto becomes public while
this Agreement is in effect, then the Company shall have the right to
immediately terminate this Agreement and the Agent shall immediately remove from
use or display, all such Marks and Materials.

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14.   NAME, LOGO, TRADEMARK OR SERVICE MARK

Solely in connection with the activities set forth herein and subject to the
terms and conditions set forth in this Agreement, the Company hereby grants to
the Agent a non-exclusive right to use the Company's Marks on such contracts,
applications, stationary, and advertisements utilized in relation to this
Agreement. This grant is expressly subject to the provisions of this Agreement,
is non-transferable and may be revoked at any time by the Company. The Agent
shall not acquire any right or license in or to any of the Company's Marks.

The Company will display the Agent's name on all policies and other
communications from the Company to its policyholders, who are clients of the
Agent, relating to policy issuance, renewal, cancellation, billing or
modification of the policyholder's insurance coverage.

The Agent agrees not to use any of the Company's Marks as part of its own marks
or for any other purpose, unless the Company consents to such use in advance and
in writing.

If this Agreement is terminated, no Company Marks or Materials shall be used by
Agent.

15.   COMPANY PROPERTY

The Agent will safeguard, maintain confidentiality and account for all forms,
manuals, equipment, and other like Company property and supplies furnished to
the Agent by the Company. Your agreement and obligation to safeguard the
confidentiality of such information will survive the termination of this
Agreement.

All such property and supplies shall always remain the exclusive property of the
Company and shall be returned to the Company or its representative before the
date of termination of this Agreement.

16.   TERMINATION

This Agreement may be terminated as follows:

      a.    This Agreement may be terminated by either party by giving the other
            party a minimum of ninety (90) days advance written notice, prior to
            the effective date of termination, or more if required by state law,
            of its intent to terminate this Agreement;

      b.    This Agreement may be terminated immediately by mutual agreement and
            consent of both parties, where permitted by law;

      c.    This Agreement shall terminate immediately upon the occurrence of
            one or more of the following:

            i.    Any willful misconduct, violation of law, or any act of fraud
                  or dishonesty relating to this Agreement, by either party or
                  any of its officers, directors or employees; or

            ii.   Receivership, liquidation, insolvency, bankruptcy, admission
                  in writing by a party of its inability to pay debts as they
                  become due, or assignment for the benefit of creditors; or

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            iii.  Suspension, probation, revocation or termination of Agent's
                  license;

            iv.   Violation of Section 12; or

            v.    the loss of adequate reinsurance covering any and all business
                  written by the Agent with the Company.

The Agent shall have no authority to quote or bind any new business on or after
the date notice of termination is sent by the Company. The Agent will have no
authority to quote or bind any renewal business, pursuant to this Agreement,
with a policy effective date on or after the effective date of termination,
unless required by law or regulation. The Agent will use their best efforts to
place all such business elsewhere.

Upon termination of this Agreement, the Company agrees that commissions will be
applied in accordance with the attached addenda on premiums collected by the
Agent and paid to the Company. In addition, it is agreed that on cancellation
and return premiums, the Company shall charge and the Agent shall pay a return
commission, in accordance with the attached Addenda.

Unless required by law, the Company will not permit the Agent to deduct their
commission on any business renewed after the effective date of the termination
of this Agreement. If the Company is required by state law to have the Agent
continue to provide service to policyholders after this Agreement has been
terminated, the Company will permit the Agent to deduct the minimum commission
allowable by applicable state law on policies that are renewed pursuant to state
law after the effective date of termination of this Agreement as full
compensation for such service. Such commission deductions shall be made at the
end of each calendar quarter and shall be computed and paid by the Company to
the Agent.

17.   COMPLIANCE WITH LAW

The Agent acknowledges that it may receive personal and private information
about a policyholder. The Agent agrees to maintain such information in
confidence and to maintain adequate safeguards to insure the confidentiality of
such information, in accordance with applicable federal and state law.

Also, the Agent represents that it is compliant, or will become compliant within
six (6) months of the Effective Date of this Agreement, with the Violent Crime
Control Act of 1994 and the USA Patriot Act of 2002.

18.   INDEMNIFICATION

The Company shall defend, indemnify, and hold harmless the Agent and/or Agent's
directors, officers, employees, agents, or other representatives from and
against any claims, suits, hearings, actions, damages, losses, or expenses, made
by a policyholder of the Company relating solely to an alleged act, error, or
omission of the Company in its proceedings or handling of the policyholder's
policy; provided, however, that the Company shall not be required to defend or
indemnify the Agent to the extent that it is alleged that the Agent caused, was
involved in, or contributed to such act, error or omission. The Agent shall
promptly notify the Company of any such claim, suit, hearing, action or
proceeding or threat thereof.

The Agent shall defend, indemnify, and hold harmless the Company, its parent,
subsidiaries and affiliates and/or their officers, directors, employees, agents
or other

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representatives for any and all damages, losses, liabilities, fines, penalties,
costs, and all other expenses reasonably incurred by the Company, including
reasonable attorneys fees, for liabilities imposed upon the Company in
connection with or arising out of any claim, suit, hearing, action or
proceeding, or threat thereof in which the Company is involved by reason of the
Agent having performed services for the Company under this Agreement, or having
failed to perform services required under this Agreement. The Company shall
promptly notify the Agent of any such claim, suit, hearing, action or proceeding
or threat thereof

19.   COMPANY'S RIGHT OF OFFSET

The Company or the Agent may offset any money owed  under this Agreement .

20.   INSPECTION AND AUDIT OF AGENT

The Agent, upon reasonable notice and during normal business hours, will permit
duly authorized representative(s) of the Company, at the Company's expense, to
visit, inspect, examine, copy, audit, and verify, at Agents' offices or
elsewhere, all documents, files, books, reports, work papers, accounting records
or bank statements relating to the insurance written under this Agreement. Any
inspection or audit by the Company will take place no later than thirty (30)
days from the Company's written request to the Agent.

21.   NO THIRD PARTY BENEFICIARIES

This Agreement is for the exclusive benefit of the parties hereto, and no third
party, including without limitation any policyholder is intended or shall be a
beneficiary of any provisions hereof.

22.   ASSIGNMENT

This Agreement shall inure to the benefit of any successor of the Company. The
Agent shall not assign any of its rights, or delegate any of its duties,
obligations or responsibilities under this Agreement without the prior written
consent of the Company. The Agent agrees to provide ninety (90) days advance
written notice to the Company of any sale or transfer of its business or
consolidation with another company. The Company may consent to an assignment of
this Agreement or elect to terminate this Agreement, in accordance with Section
16 of this Agreement. Any purported assignment by the Agent, in the absence of
such written consent by the Company, shall be void.

23.   WAIVER

The failure of either party at any time to enforce any provision of this
Agreement, or any right or remedy hereunder at law or in equity, or to exercise
any election herein provided, shall not constitute a waiver of any provision,
right, remedy or election or in any way affect the validity of this Agreement,
nor act as a waiver of any subsequent breach or waiver of that same provision or
any other provision of this Agreement.

24.   NOTICE

All notices, demands and requests required or permitted to be given under this
Agreement shall be in writing and shall be directed to the addresses indicated
below, or such other address as indicated by the parties, from time to time.
Such notices or other

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communications shall be deemed given (a) when personally delivered or sent by
facsimile transmission or electronic mail to the party to be given the notice or
other communication at the address indicated below, or (b) on the business day
following the business day that such notice or other communication is sent by
overnight courier or next day delivery.

25.   APPLICABLE LAW

This Agreement and the rights and responsibilities of the parties hereunder
shall be construed in accordance with and governed by the laws of the State of
Michigan without regard to its conflict of law provisions. Any action arising
out of or relating to this Agreement or any act of the Agent or the Company
taken pursuant to this Agreement, or the enforcement or any breach thereof shall
be venued in the Circuit Court for the County of Oakland, State of Michigan.

26.   ACCORD AND SATISFACTION

The acceptance of the Company of any sums from the Agent in amounts which are
less than the amounts due and payable hereunder are neither intended, nor shall
they be construed, to constitute an accord and satisfaction of any dispute
between the Company and the Agent regarding sums due and payable by the Agent,
unless the Company specifically agrees to same in a document executed by both
the Agent and the Company.

27.   SEVERABILITY

If any term or provision, or any portion thereof, of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be held
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to such persons or circumstances other than those as to
which it is held invalid or unenforceable, shall not be affected thereby, and
each term and provision of this Agreement shall continue to be valid and be
enforced to the fullest extent permitted by law.

28.   ENTIRE AGREEMENT

This Agreement supersedes all previous agency agreements, whether oral or
written and may be changed or modified in a writing signed by the parties. This
Agreement is intended by the parties as a final expression of their
understanding and as a complete and exclusive statement of the terms hereof. All
negotiations, considerations, and representations between the parties having
been incorporated herein. No course of prior dealing between the parties or
their directors, officers, employees, agents or affiliates shall be relevant or
admissible to supplement, explain, or vary any of the terms of this Agreement.
Acceptance of, or acquiescence in, a course of performance rendered under this
or any prior Agreement between the parties or their affiliates shall not be
relevant nor admissible to determine the meaning of any of the terms of this
Agreement.

29.   JOINT AND SEVERAL LIABILITY.

If two or more individuals, corporations, partnerships or other business
associations (or any combination of two or more thereof) shall sign this
Agreement as the Agent, the liability of each such individual, corporation,
partnership, or other business association to perform all such obligations
hereunder shall be deemed to be joint and several, and all actions taken, or
notices, payments and agreements given, or made by, with or to any of them,
shall be deemed to be taken, given or made by all of them. In like manner, if
the Agent shall be a partnership or other business association, the members of
which are, by

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virtue of statute or federal law, subject to personal liability, the liability
of each such member shall be joint and several.

30.   REQUISITE AUTHORITY

The undersigned(s) hereby represents that they are authorized to execute this
Agreement on behalf of the Agent and the Company.

                                    MEADOWBROOK, INC.

                                    /s/ Robert S. Cubbin
                                    --------------------------------------------

                                    By:  Robert S. Cubbin
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    PREFERRED INSURANCE AGENCY, INC.

                                    /s/ William E. Brault
                                    --------------------------------------------

                                    By:  William E. Brault
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    TPA INSURANCE AGENCY, INC.

                                    /s/ William E. Brault
                                    --------------------------------------------

                                    By:  William E. Brault
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    PREFERRED COMP INSURANCE AGENCY
                                         OF NEW HAMPSHIRE

                                    /s/ Michael G. Costello
                                    --------------------------------------------

                                    By:  Michael G. Costello
                                         ---------------------------------------
                                    Its: Assistant Secretary
                                         ---------------------------------------

                                    TPA INSURANCE AGENCY OF NEW HAMPSHIRE, INC.

                                    /s/ Michael G. Costello
                                    --------------------------------------------

                                    By:  Michael G. Costello
                                         ---------------------------------------
                                    Its: Assistant Secretary
                                         ---------------------------------------

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                                    MEADOWBROOK OF NEVADA, INC. D/B/A
                                    MEADOWBROOK INSURANCE SERVICES

                                    /s/ Robert S. Cubbin
                                    --------------------------------------------

                                    By:  Robert S. Cubbin
                                         ---------------------------------------
                                    Its: Vice President
                                         ---------------------------------------

                                    MEADOWBROOK OF FLORIDA, INC.

                                    /s/ Gregory L. Wilde
                                    --------------------------------------------

                                    By:  Gregory L. Wilde
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    ASSOCIATION SELF-INSURANCE SERVICES, INC.

                                    /s/ Robert S. Cubbin
                                    --------------------------------------------

                                    By:  Robert S. Cubbin
                                         ---------------------------------------
                                    Its: Executive Vice President
                                         ---------------------------------------

                                    FLORIDA PREFERRED ADMINISTRATORS, INC.

                                    /s/ Gregory L. Wilde
                                    --------------------------------------------

                                    By:  Gregory L. Wilde
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    INTERLINE INSURANCE SERVICES, INC.

                                    /s/ Eric P. Litcher
                                    --------------------------------------------

                                    By:  Eric P. Litcher
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    COMMERCIAL CARRIERS INSURANCE AGENCY, INC.

                                    /s/ Susan P. Scurti
                                    --------------------------------------------

                                    By:  Susan P. Scurti
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

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                                    STAR INSURANCE COMPANY

                                    /s/ Joseph C. Henry
                                    --------------------------------------------

                                    By:  Joseph C. Henry
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    SAVERS PROPERTY & CASUALTY INSURANCE COMPANY

                                    /s/ Karl W. Koch
                                    --------------------------------------------

                                    By:  Karl W. Koch
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    WILLIAMSBURG NATIONAL INSURANCE CO.

                                    /s/ Gregory L. Wilde
                                    --------------------------------------------

                                    By:  Gregory L. Wilde
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    AMERITRUST INSURANCE CORPORATION

                                    /s/ Gregory L. Wilde
                                    --------------------------------------------

                                    By:  Gregory L. Wilde
                                         ---------------------------------------
                                    Its: President
                                         ---------------------------------------

                                    13 of 13<PAGE>

                                                                 EXHIBIT 4(a)(i)

                       EIGHTY-THIRD SUPPLEMENTAL INDENTURE

                        PROVIDING AMONG OTHER THINGS FOR

                              FIRST MORTGAGE BONDS,

                           COLLATERAL SERIES DUE 2004

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

                         DATED AS OF SEPTEMBER 26, 2002

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

                            CONSUMERS ENERGY COMPANY

                                       TO

                              JPMORGAN CHASE BANK,

                                     TRUSTEE

                                                         Counterpart _____ of 80

<PAGE>

         THIS EIGHTY-THIRD SUPPLEMENTAL INDENTURE, dated as of September 26,
2002 (herein sometimes referred to as "this Supplemental Indenture"), made and
entered into by and between CONSUMERS ENERGY COMPANY, a corporation organized
and existing under the laws of the State of Michigan, with its principal
executive office and place of business at 212 West Michigan Avenue, in Jackson,
Jackson County, Michigan 49201, formerly known as Consumers Power Company
(hereinafter sometimes referred to as the "Company"), and JPMORGAN CHASE BANK, a
corporation organized and existing under the laws of the State of New York, with
its corporate trust offices at 450 W. 33rd Street, in the Borough of Manhattan,
The City of New York, New York 10001 (hereinafter sometimes referred to as the
"Trustee"), as Trustee under the Indenture dated as of September 1, 1945 between
Consumers Power Company, a Maine corporation (hereinafter sometimes referred to
as the "Maine corporation"), and City Bank Farmers Trust Company (Citibank,
N.A., successor, hereinafter sometimes referred to as the "Predecessor
Trustee"), securing bonds issued and to be issued as provided therein
(hereinafter sometimes referred to as the "Indenture"),

         WHEREAS at the close of business on January 30, 1959, City Bank Farmers
Trust Company was converted into a national banking association under the title
"First National City Trust Company"; and

         WHEREAS at the close of business on January 15, 1963, First National
City Trust Company was merged into First National City Bank; and

         WHEREAS at the close of business on October 31, 1968, First National
City Bank was merged into The City Bank of New York, National Association, the
name of which was thereupon changed to First National City Bank; and

         WHEREAS effective March 1, 1976, the name of First National City Bank
was changed to Citibank, N.A.; and

         WHEREAS effective July 16, 1984, Manufacturers Hanover Trust Company
succeeded Citibank, N.A. as Trustee under the Indenture; and

         WHEREAS effective June 19, 1992, Chemical Bank succeeded by merger to
Manufacturers Hanover Trust Company as Trustee under the Indenture; and

         WHEREAS effective July 15, 1996, The Chase Manhattan Bank (National
Association), merged with and into Chemical Bank which thereafter was renamed
The Chase Manhattan Bank; and

         WHEREAS effective November 11, 2001, The Chase Manhattan Bank merged
with Morgan Guaranty Trust Company of New York and the surviving corporation was
renamed JPMorgan Chase Bank; and

         WHEREAS the Indenture was executed and delivered for the purpose of
securing such bonds as may from time to time be issued under and in accordance
with the terms of the Indenture, the aggregate principal amount of bonds to be
secured thereby being limited to $5,000,000,000 at any one time outstanding
(except as provided in Section 2.01 of the Indenture), and the Indenture
describes and sets forth the property conveyed thereby and is filed in the
Office of the Secretary of State of the State of Michigan and is of record in
the Office of

                                       -1-

<PAGE>

the Register of Deeds of each county in the State of Michigan in which this
Supplemental Indenture is to be recorded; and

         WHEREAS the Indenture has been supplemented and amended by various
indentures supplemental thereto, each of which is filed in the Office of the
Secretary of State of the State of Michigan and is of record in the Office of
the Register of Deeds of each county in the State of Michigan in which this
Supplemental Indenture is to be recorded; and

         WHEREAS the Company and the Maine corporation entered into an Agreement
of Merger and Consolidation, dated as of February 14, 1968, which provided for
the Maine corporation to merge into the Company; and

         WHEREAS the effective date of such Agreement of Merger and
Consolidation was June 6, 1968, upon which date the Maine corporation was merged
into the Company and the name of the Company was changed from "Consumers Power
Company of Michigan" to "Consumers Power Company"; and

         WHEREAS the Company and the Predecessor Trustee entered into a
Sixteenth Supplemental Indenture, dated as of June 4, 1968, which provided,
among other things, for the assumption of the Indenture by the Company; and

         WHEREAS said Sixteenth Supplemental Indenture became effective on the
effective date of such Agreement of Merger and Consolidation; and

         WHEREAS the Company has succeeded to and has been substituted for the
Maine corporation under the Indenture with the same effect as if it had been
named therein as the mortgagor corporation; and

         WHEREAS effective March 11, 1997, the name of Consumers Power Company
was changed to Consumers Energy Company; and

         WHEREAS, the Company has entered into an Amended and Restated Term Loan
Agreement dated as of September 26, 2002 (the "Term Loan Agreement") with
various financial institutions and Citicorp North America, Inc., as
administrative agent (in such capacity, the "Agent") for the Banks (as such term
is defined in the Term Loan Agreement) providing for the making of certain
financial accommodations thereunder, and pursuant to such Term Loan Agreement
the Company has agreed to issue to the Agent, as evidence of and security for
the Obligations (as such term is defined in the Term Loan Agreement), a new
series of bonds under the Indenture; and

         WHEREAS, for such purposes the Company desires to issue a new series of
bonds, to be designated First Mortgage Bonds, Collateral Series due 2004, each
of which bonds shall also bear the descriptive title "First Mortgage Bond"
(hereinafter provided for and hereinafter sometimes referred to as the "2004
Collateral Series Bonds"), the bonds of which series are to be issued as
registered bonds without coupons and are to bear interest at the rate per annum
specified herein and are to mature July 11, 2004; and

         WHEREAS, each of the registered bonds without coupons of the 2004
Collateral Series Bonds and the Trustee's Authentication Certificate thereon are
to be substantially in the following form, to wit:

                                       -2-

<PAGE>

          [FORM OF REGISTERED BOND OF THE 2004 COLLATERAL SERIES BONDS]

                                     [FACE]

                            CONSUMERS ENERGY COMPANY
                               FIRST MORTGAGE BOND
                           COLLATERAL SERIES DUE 2004

         No. 1                                              $300,000,000

         CONSUMERS ENERGY COMPANY, a Michigan corporation (hereinafter called
the "Company"), for value received, hereby promises to pay to Citicorp North
America, Inc., as agent (in such capacity, the "Agent") for the Banks under and
as defined in the Amended and Restated Term Loan Agreement dated as of September
26, 2002 among the Company, the Banks and the Agent (the "Term Loan Agreement"),
or registered assigns, the principal sum of Three Hundred Million Dollars
($300,000,000) or such lesser principal amount as shall be equal to the
aggregate principal amount of the Term Loans (as defined in the Term Loan
Agreement) included in the Obligations (as defined in the Term Loan Agreement)
outstanding on July 11, 2004 (the "Maturity Date"), but not in excess, however,
of the principal amount of this bond, and to pay interest thereon at the
Interest Rate (as defined below) until the principal hereof is paid or duly made
available for payment on the Maturity Date, or, in the event of redemption of
this bond, until the redemption date, or, in the event of default in the payment
of the principal hereof, until the Company's obligations with respect to the
payment of such principal shall be discharged as provided in the Indenture (as
defined on the reverse hereof). Interest on this bond shall be payable on each
Interest Payment Date (as defined below), commencing on the first Interest
Payment Date next succeeding September 26, 2002. If the Maturity Date falls on a
day which is not a Business Day, as defined below, principal and any interest
and/or fees payable with respect to the Maturity Date will be paid on the
immediately preceding Business Day. The interest payable, and punctually paid or
duly provided for, on any Interest Payment Date will, subject to certain
exceptions, be paid to the person in whose name this bond (or one or more
predecessor bonds) is registered at the close of business on the Record Date (as
defined below); provided, however, that interest payable on the Maturity Date
will be payable to the person to whom the principal hereof shall be payable.
Should the Company default in the payment of interest ("Defaulted Interest"),
the Defaulted Interest shall be paid to the person in whose name this bond (or
one or more predecessor bonds) is registered on a subsequent record date fixed
by the Company, which subsequent record date shall be fifteen (15) days prior to
the payment of such Defaulted Interest. As used herein, (A) "Business Day" shall
mean any day, other than a Saturday or Sunday, on which banks generally are open
in New York, New York for the conduct of substantially all of their commercial
lending activities and on which interbank wire transfers can be made on the
Fedwire system; (B) "Interest Payment Date" shall mean each date on which
interest and/or fees under the Term Loan Agreement are due and payable from time
to time pursuant to the Term Loan Agreement; (C) "Interest Rate" shall mean a
rate of interest per annum, adjusted as necessary, to result in an interest
payment equal to the aggregate amount of interest and fees due under the Term
Loan Agreement on the applicable Interest Payment Date; and (D) "Record Date"
with respect to any Interest Payment Date shall mean the day (whether or not a
Business Day) immediately next preceding such Interest Payment Date.

                                       -3-

<PAGE>

         Payment of the principal of and interest on this bond will be made in
immediately available funds at the office or agency of the Company maintained
for that purpose in the City of Jackson, Michigan, in such coin or currency of
the United States of America as at the time of payment is legal tender for
payment of public and private debts.

         The provisions of this bond are continued on the reverse hereof and
such continued provisions shall for all purposes have the same effect as though
fully set forth at this place.

         This bond shall not be valid or become obligatory for any purpose
unless and until it shall have been authenticated by the execution by the
Trustee or its successor in trust under the Indenture of the certificate hereon.

         IN WITNESS WHEREOF, Consumers Energy Company has caused this bond to be
executed in its name by its Chairman of the Board, its President or one of its
Vice Presidents by his or her signature or a facsimile thereof, and its
corporate seal or a facsimile thereof to be affixed hereto or imprinted hereon
and attested by its Secretary or one of its Assistant Secretaries by his or her
signature or a facsimile thereof.

                                       CONSUMERS ENERGY COMPANY

Dated:

                                       By:  ____________________________________
                                       Printed:  _______________________________
                                       Title:  _________________________________

Attest:  _________________________

                      TRUSTEE'S AUTHENTICATION CERTIFICATE

         This is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.

                                   JPMORGAN CHASE BANK, Trustee

                                   By___________________________________________
                                                Authorized Officer

                                       -4-

<PAGE>

                                    [REVERSE]

                            CONSUMERS ENERGY COMPANY

                               FIRST MORTGAGE BOND
                           COLLATERAL SERIES DUE 2004

         This bond is one of the bonds of a series designated as First Mortgage
Bonds, Collateral Series due 2004 (sometimes herein referred to as the "2004
Collateral Series Bonds") issued under and in accordance with and secured by an
Indenture dated as of September 1, 1945, given by the Company (or its
predecessor, Consumers Power Company, a Maine corporation) to City Bank Farmers
Trust Company (JPMorgan Chase Bank, successor) (hereinafter sometimes referred
to as the "Trustee"), together with indentures supplemental thereto, heretofore
or hereafter executed, to which indenture and indentures supplemental thereto
(hereinafter referred to collectively as the "Indenture") reference is hereby
made for a description of the property mortgaged and pledged, the nature and
extent of the security and the rights, duties and immunities thereunder of the
Trustee and the rights of the holders of said bonds and of the Trustee and of
the Company in respect of such security, and the limitations on such rights. By
the terms of the Indenture, the bonds to be secured thereby are issuable in
series which may vary as to date, amount, date of maturity, rate of interest and
in other respects as provided in the Indenture.

         The 2004 Collateral Series Bonds are to be issued and delivered to the
Agent in order evidence and secure the obligation of the Company under the Term
Loan Agreement to make payments to the Banks under the Term Loan Agreement and
to provide the Banks the benefit of the lien of the Indenture with respect to
the 2004 Collateral Series Bonds.

         The obligation of the Company to make payments with respect to the
principal of 2004 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with respect to the principal of the 2004
Collateral Series Bonds shall be deemed discharged in the same amount as the
payment with respect to the Term Loans discharges the outstanding obligation
with respect to such Term Loans.

         The obligation of the Company to make payments with respect to the
interest on 2004 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2004 Collateral Series

                                       -5-

<PAGE>

Bonds shall be deemed discharged in the same amount as the payment with respect
to the Term Loans discharges the outstanding obligation with respect to such
Term Loans.

         The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on this bond, so far as such payments at the time have become due, has
been fully satisfied and discharged unless and until the Trustee shall have
received a written notice from the Agent stating (i) that timely payment of
principal and interest on the 2004 Collateral Series Bonds has not been made,
(ii) that the Company is in arrears as to the payments required to be made by it
to the Agent pursuant to the Term Loan Agreement, and (iii) the amount of the
arrearage.

         If an Event of Default (as defined in the Term Loan Agreement) with
respect to the payment of the principal of any Term Loans shall have occurred,
it shall be deemed to be a default for purposes of Section 11.01 of the
Indenture in the payment of the principal of the 2004 Collateral Series Bonds
equal to the amount of such unpaid principal (but in no event in excess of the
principal amount of the 2004 Collateral Series Bonds). If an Event of Default
(as defined in the Term Loan Agreement) with respect to the payment of interest
on any Term Loans or fees shall have occurred, it shall be deemed to be a
default for purposes of Section 11.01 of the Indenture in the payment of the
interest on the 2004 Collateral Series Bonds equal to the amount of such unpaid
interest or fees.

         This bond is not redeemable except upon written demand of the Agent
following the occurrence of an Event of Default under the Term Loan Agreement
and the acceleration of the Obligations, as provided in Section 9.2 of the Term
Loan Agreement. This bond is not redeemable by the operation of the improvement
fund or the maintenance and replacement provisions of the Indenture or with the
proceeds of released property.

         In case of certain defaults as specified in the Indenture, the
principal of this bond may be declared or may become due and payable on the
conditions, at the time, in the manner and with the effect provided in the
Indenture. The holders of certain specified percentages of the bonds at the time
outstanding, including in certain cases specified percentages of bonds of
particular series, may in certain cases, to the extent and as provided in the
Indenture, waive certain defaults thereunder and the consequences of such
defaults.

         The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than seventy-five per
centum in principal amount of the bonds (exclusive of bonds disqualified by
reason of the Company's interest therein) at the time outstanding, including, if
more than one series of bonds shall be at the time outstanding, not less than
sixty per centum in principal amount of each series affected, to effect, by an
indenture supplemental to the Indenture, modifications or alterations of the
Indenture and of the rights and obligations of the Company and the rights of the
holders of the bonds and coupons; provided, however, that no such modification
or alteration shall be made without the written approval or consent of the
holder hereof which will (a) extend the maturity of this bond or reduce the rate
or extend the time of payment of interest hereon or reduce the amount of the
principal hereof, or (b) permit the creation of any lien, not otherwise
permitted, prior to or on a parity with the lien of the Indenture, or (c) reduce
the percentage of the principal amount of the bonds the holders of which are
required to approve any such supplemental indenture.

                                       -6-

<PAGE>

         The Company reserves the right, without any consent, vote or other
action by holders of the 2004 Collateral Series Bonds or any other series
created after the Sixty-eighth Supplemental Indenture to amend the Indenture to
reduce the percentage of the principal amount of bonds the holders of which are
required to approve any supplemental indenture (other than any supplemental
indenture which is subject to the proviso contained in the immediately preceding
sentence) (a) from not less than seventy-five per centum (including sixty per
centum of each series affected) to not less than a majority in principal amount
of the bonds at the time outstanding or (b) in case fewer than all series are
affected, not less than a majority in principal amount of the bonds of all
affected series, voting together.

         No recourse shall be had for the payment of the principal of or
interest on this bond, or for any claim based hereon, or otherwise in respect
hereof or of the Indenture, to or against any incorporator, stockholder,
director or officer, past, present or future, as such, of the Company, or of any
predecessor or successor company, either directly or through the Company, or
such predecessor or successor company, or otherwise, under any constitution or
statute or rule of law, or by the enforcement of any assessment or penalty, or
otherwise, all such liability of incorporators, stockholders, directors and
officers, as such, being waived and released by the holder and owner hereof by
the acceptance of this bond and being likewise waived and released by the terms
of the Indenture.

         This bond shall be exchangeable for other registered bonds of the same
series, in the manner and upon the conditions prescribed in the Indenture, upon
the surrender of such bonds at the Investor Services Department of the Company,
as transfer agent. However, notwithstanding the provisions of Section 2.05 of
the Indenture, no charge shall be made upon any registration of transfer or
exchange of bonds of said series other than for any tax or taxes or other
governmental charge required to be paid by the Company.

         The Agent shall surrender this bond to the Trustee when all of the
principal of and interest on the Term Loans arising under the Term Loan
Agreement, and all of the fees payable pursuant to the Term Loan Agreement,
shall have been duly paid, and the Term Loan Agreement shall have been
terminated.

      [END OF FORM OF REGISTERED BOND OF THE 2004 COLLATERAL SERIES BONDS]

                                       -7-

<PAGE>

         AND WHEREAS all acts and things necessary to make the 2004 Collateral
Series Bonds, when duly executed by the Company and authenticated by the Trustee
or its agent and issued as prescribed in the Indenture, as heretofore
supplemented and amended, and this Supplemental Indenture provided, the valid,
binding and legal obligations of the Company, and to constitute the Indenture,
as supplemented and amended as aforesaid, as well as by this Supplemental
Indenture, a valid, binding and legal instrument for the security thereof, have
been done and performed, and the creation, execution and delivery of this
Supplemental Indenture and the creation, execution and issuance of bonds subject
to the terms hereof and of the Indenture, as so supplemented and amended, have
in all respects been duly authorized;

         NOW, THEREFORE, in consideration of the premises, of the acceptance and
purchase by the holders thereof of the bonds issued and to be issued under the
Indenture, as supplemented and amended as above set forth, and of the sum of One
Dollar duly paid by the Trustee to the Company, and of other good and valuable
considerations, the receipt whereof is hereby acknowledged, and for the purpose
of securing the due and punctual payment of the principal of and premium, if
any, and interest on all bonds now outstanding under the Indenture and the
$300,000,000 principal amount of the 2004 Collateral Series Bonds proposed to be
issued initially and all other bonds which shall be issued under the Indenture,
as supplemented and amended from time to time, and for the purpose of securing
the faithful performance and observance of all covenants and conditions therein,
and in any indenture supplemental thereto, set forth, the Company has given,
granted, bargained, sold, released, transferred, assigned, hypothecated,
pledged, mortgaged, confirmed, set over, warranted, alienated and conveyed and
by these presents does give, grant, bargain, sell, release, transfer, assign,
hypothecate, pledge, mortgage, confirm, set over, warrant, alien and convey unto
JPMorgan Chase Bank, as Trustee, as provided in the Indenture, and its successor
or successors in the trust thereby and hereby created and to its or their
assigns forever, all the right, title and interest of the Company in and to all
the property, described in Section 11 hereof, together (subject to the
provisions of Article X of the Indenture) with the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, excepting, however, the
property, interests and rights specifically excepted from the lien of the
Indenture as set forth in the Indenture;

         TOGETHER WITH all and singular the tenements, hereditaments and
appurtenances belonging or in any wise appertaining to the premises, property,
franchises and rights, or any thereof, referred to in the foregoing granting
clause, with the reversion and reversions, remainder and remainders and (subject
to the provisions of Article X of the Indenture) the tolls, rents, revenues,
issues, earnings, income, products and profits thereof, and all the estate,
right, title and interest and claim whatsoever, at law as well as in equity,
which the Company now has or may hereafter acquire in and to the aforesaid
premises, property, franchises and rights and every part and parcel thereof;

         SUBJECT, HOWEVER, with respect to such premises, property, franchises
and rights, to excepted encumbrances as said term is defined in Section 1.02 of
the Indenture, and subject also to all defects and limitations of title and to
all encumbrances existing at the time of acquisition. TO HAVE AND TO HOLD all
said premises, property, franchises and rights hereby conveyed, assigned,
pledged or mortgaged, or intended so to be, unto the Trustee, its successor or
successors in trust and their assigns forever;

                                       -8-

<PAGE>

         BUT IN TRUST, NEVERTHELESS, with power of sale for the equal and
proportionate benefit and security of the holders of all bonds now or hereafter
authenticated and delivered under and secured by the Indenture and interest
coupons appurtenant thereto, pursuant to the provisions of the Indenture and of
any supplemental indenture, and for the enforcement of the payment of said bonds
and coupons when payable and the performance of and compliance with the
covenants and conditions of the Indenture and of any supplemental indenture,
without any preference, distinction or priority as to lien or otherwise of any
bond or bonds over others by reason of the difference in time of the actual
authentication, delivery, issue, sale or negotiation thereof or for any other
reason whatsoever, except as otherwise expressly provided in the Indenture; and
so that each and every bond now or hereafter authenticated and delivered
thereunder shall have the same lien, and so that the principal of and premium,
if any, and interest on every such bond shall, subject to the terms thereof, be
equally and proportionately secured, as if it had been made, executed,
authenticated, delivered, sold and negotiated simultaneously with the execution
and delivery thereof;

         AND IT IS EXPRESSLY DECLARED by the Company that all bonds
authenticated and delivered under and secured by the Indenture, as supplemented
and amended as above set forth, are to be issued, authenticated and delivered,
and all said premises, property, franchises and rights hereby and by the
Indenture and indentures supplemental thereto conveyed, assigned, pledged or
mortgaged, or intended so to be, are to be dealt with and disposed of under,
upon and subject to the terms, conditions, stipulations, covenants, agreements,
trusts, uses and purposes expressed in the Indenture, as supplemented and
amended as above set forth, and the parties hereto mutually agree as follows:

         SECTION 1. There is hereby created one series of bonds (the "2004
Collateral Series Bonds") designated as hereinabove provided, which shall also
bear the descriptive title "First Mortgage Bond", and the form thereof shall be
substantially as hereinbefore set forth (the "Sample Bond"). The 2004 Collateral
Series Bonds shall be issued in the aggregate principal amount of $300,000,000,
shall mature on July 11, 2004 and shall be issued only as registered bonds
without coupons in denominations of $1,000 and any multiple thereof. The serial
numbers of the 2004 Collateral Series Bonds shall be such as may be approved by
any officer of the Company, the execution thereof by any such officer either
manually or by facsimile signature to be conclusive evidence of such approval.
The 2004 Collateral Series Bonds are to be issued to and registered in the name
of the Agent under the Term Loan Agreement (as such terms are defined in the
Sample Bond) to evidence and secure any and all Obligations (as such term is
defined in the Term Loan Agreement) of the Company under the Term Loan
Agreement.

         The 2004 Collateral Series Bonds shall bear interest as set forth in
the Sample Bond. The principal of and the interest on said bonds shall be
payable as set forth in the Sample Bond.

         The obligation of the Company to make payments with respect to the
principal of 2004 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due principal of the Term Loans included in
the Obligations shall have been fully or partially paid. Satisfaction of any
obligation to the extent that payment is made with respect to the Term Loans
means that if any payment is made on the principal of the Term Loans, a
corresponding payment obligation with respect to the principal of the 2004
Collateral Series Bonds shall be deemed discharged in the

                                       -9-

<PAGE>

same amount as the payment with respect to the Term Loans discharges the
outstanding obligation with respect to such Term Loans.

         The obligation of the Company to make payments with respect to the
interest on 2004 Collateral Series Bonds shall be fully or partially, as the
case may be, satisfied and discharged to the extent that, at the time that any
such payment shall be due, the then due interest and/or fees on the Term Loans
included in the Obligations shall have been fully or partially paid.
Satisfaction of any obligation to the extent that payment is made with respect
to the Term Loans means that if any payment is made on the interest and/or fees
on the Term Loans, a corresponding payment obligation with respect to the
interest on the 2004 Collateral Series Bonds shall be deemed discharged in the
same amount as the payment with respect to the Term Loans discharges the
outstanding obligation with respect to such Term Loans.

         The Trustee may at any time and all times conclusively assume that the
obligation of the Company to make payments with respect to the principal of and
interest on the 2004 Collateral Series Bonds, so far as such payments at the
time have become due, has been fully satisfied and discharged unless and until
the Trustee shall have received a written notice from the Agent stating (i) that
timely payment of principal and interest on the 2004 Collateral Series Bonds has
not been made, (ii) that the Company is in arrears as to the payments required
to be made by it to the Agent pursuant to the Term Loan Agreement, and (iii) the
amount of the arrearage.

         The 2004 Collateral Series Bonds shall be exchangeable for other
registered bonds of the same series, in the manner and upon the conditions
prescribed in the Indenture, upon the surrender of such bonds at the Investor
Services Department of the Company, as transfer agent. However, notwithstanding
the provisions of Section 2.05 of the Indenture, no charge shall be made upon
any registration of transfer or exchange of bonds of said series other than for
any tax or taxes or other governmental charge required to be paid by the
Company.

         SECTION 2. The 2004 Collateral Series Bonds are not redeemable by the
operation of the maintenance and replacement provisions of this Indenture or
with the proceeds of released property.

         SECTION 3. Upon the occurrence of an Event of Default under the Term
Loan Agreement and the acceleration of the Obligations, the 2004 Collateral
Series Bonds shall be redeemable in whole upon receipt by the Trustee of a
written demand from the Agent stating that there has occurred under the Term
Loan Agreement both an Event of Default and a declaration of acceleration of the
Obligations and demanding redemption of the 2004 Collateral Series Bonds
(including a description of the amount of principal, interest and fees which
comprise such Obligations). The Company waives any right it may have to prior
notice of such redemption under the Indenture. Upon surrender of the 2004
Collateral Series Bonds by the Agent to the Trustee, the 2004 Collateral Series
Bonds shall be redeemed at a redemption price equal to the aggregate amount of
the Obligations.

         SECTION 4. The Company reserves the right, without any consent, vote or
other action by the holder of the 2004 Collateral Series Bonds or of any
subsequent series of bonds issued under the Indenture, to make such amendments
to the Indenture, as supplemented, as shall be necessary in order to amend
Section 17.02 to read as follows:

                                      -10-

<PAGE>

                  SECTION 17.02. With the consent of the holders of not less
         than a majority in principal amount of the bonds at the time
         outstanding or their attorneys-in-fact duly authorized, or, if fewer
         than all series are affected, not less than a majority in principal
         amount of the bonds at the time outstanding of each series the rights
         of the holders of which are affected, voting together, the Company,
         when authorized by a resolution, and the Trustee may from time to time
         and at any time enter into an indenture or indentures supplemental
         hereto for the purpose of adding any provisions to or changing in any
         manner or eliminating any of the provisions of this Indenture or of any
         supplemental indenture or modifying the rights and obligations of the
         Company and the rights of the holders of any of the bonds and coupons;
         provided, however, that no such supplemental indenture shall (1) extend
         the maturity of any of the bonds or reduce the rate or extend the time
         of payment of interest thereon, or reduce the amount of the principal
         thereof, or reduce any premium payable on the redemption thereof,
         without the consent of the holder of each bond so affected, or (2)
         permit the creation of any lien, not otherwise permitted, prior to or
         on a parity with the lien of this Indenture, without the consent of the
         holders of all the bonds then outstanding, or (3) reduce the aforesaid
         percentage of the principal amount of bonds the holders of which are
         required to approve any such supplemental indenture, without the
         consent of the holders of all the bonds then outstanding. For the
         purposes of this Section, bonds shall be deemed to be affected by a
         supplemental indenture if such supplemental indenture adversely affects
         or diminishes the rights of holders thereof against the Company or
         against its property. The Trustee may in its discretion determine
         whether or not, in accordance with the foregoing, bonds of any
         particular series would be affected by any supplemental indenture and
         any such determination shall be conclusive upon the holders of bonds of
         such series and all other series. Subject to the provisions of Sections
         16.02 and 16.03 hereof, the Trustee shall not be liable for any
         determination made in good faith in connection herewith.

                  Upon the written request of the Company, accompanied by a
         resolution authorizing the execution of any such supplemental
         indenture, and upon the filing with the Trustee of evidence of the
         consent of bondholders as aforesaid (the instrument or instruments
         evidencing such consent to be dated within one year of such request),
         the Trustee shall join with the Company in the execution of such
         supplemental indenture unless such supplemental indenture affects the
         Trustee's own rights, duties or immunities under this Indenture or
         otherwise, in which case the Trustee may in its discretion but shall
         not be obligated to enter into such supplemental indenture.

                  It shall not be necessary for the consent of the bondholders
         under this Section to approve the particular form of any proposed
         supplemental indenture, but it shall be sufficient if such consent
         shall approve the substance thereof.

                  The Company and the Trustee, if they so elect, and either
         before or after such consent has been obtained, may require the holder
         of any bond consenting to the execution of any such supplemental
         indenture to submit his bond to the Trustee or to ask such bank, banker
         or trust company as may be designated by the Trustee

                                      -11-

<PAGE>

         for the purpose, for the notation thereon of the fact that the holder
         of such bond has consented to the execution of such supplemental
         indenture, and in such case such notation, in form satisfactory to the
         Trustee, shall be made upon all bonds so submitted, and such bonds
         bearing such notation shall forthwith be returned to the persons
         entitled thereto.

                  Prior to the execution by the Company and the Trustee of any
         supplemental indenture pursuant to the provisions of this Section, the
         Company shall publish a notice, setting forth in general terms the
         substance of such supplemental indenture, at least once in one daily
         newspaper of general circulation in each city in which the principal of
         any of the bonds shall be payable, or, if all bonds outstanding shall
         be registered bonds without coupons or coupon bonds registered as to
         principal, such notice shall be sufficiently given if mailed, first
         class, postage prepaid, and registered if the Company so elects, to
         each registered holder of bonds at the last address of such holder
         appearing on the registry books, such publication or mailing, as the
         case may be, to be made not less than thirty days prior to such
         execution. Any failure of the Company to give such notice, or any
         defect therein, shall not, however, in any way impair or affect the
         validity of any such supplemental indenture.

         SECTION 5. As supplemented and amended as above set forth, the
Indenture is in all respects ratified and confirmed, and the Indenture and all
indentures supplemental thereto shall be read, taken and construed as one and
the same instrument.

         SECTION 6. Nothing contained in this Supplemental Indenture shall, or
shall be construed to, confer upon any person other than a holder of bonds
issued under the Indenture, as supplemented and amended as above set forth, the
Company, the Trustee and the Agent, for the benefit of the Banks (as such term
is defined in the Term Loan Agreement), any right or interest to avail himself
of any benefit under any provision of the Indenture, as so supplemented and
amended.

         SECTION 7. The Trustee assumes no responsibility for or in respect of
the validity or sufficiency of this Supplemental Indenture or of the Indenture
as hereby supplemented or the due execution hereof by the Company or for or in
respect of the recitals and statements contained herein (other than those
contained in the sixth, seventh and eighth recitals hereof), all of which
recitals and statements are made solely by the Company.

         SECTION 8. This Supplemental Indenture may be simultaneously executed
in several counterparts and all such counterparts executed and delivered, each
as an original, shall constitute but one and the same instrument.

         SECTION 9. In the event the date of any notice required or permitted
hereunder shall not be a Business Day, then (notwithstanding any other provision
of the Indenture or of any supplemental indenture thereto) such notice need not
be made on such date, but may be made on the next succeeding Business Day with
the same force and effect as if made on the date fixed for such notice.
"Business Day" means, with respect to this Section 9, any day, other than a
Saturday or Sunday, on which banks generally are open in New York, New York for
the conduct

                                      -12-

<PAGE>

of substantially all of their commercial lending activities and on which
interbank wire transfers can be made on the Fedwire system.

         SECTION 10. This Supplemental Indenture and the 2004 Collateral Series
Bonds shall be governed by and deemed to be a contract under, and construed in
accordance with, the laws of the State of Michigan, and for all purposes shall
be construed in accordance with the laws of such state, except as may otherwise
be required by mandatory provisions of law.

         SECTION 11.  Detailed Description of Property Mortgaged:

                                       I.

                       ELECTRIC GENERATING PLANTS AND DAMS

         All the electric generating plants and stations of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, including all powerhouses, buildings, reservoirs, dams,
pipelines, flumes, structures and works and the land on which the same are
situated and all water rights and all other lands and easements, rights of way,
permits, privileges, towers, poles, wires, machinery, equipment, appliances,
appurtenances and supplies and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with such
plants and stations or any of them, or adjacent thereto.

                                       II.

                           ELECTRIC TRANSMISSION LINES

         All the electric transmission lines of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including towers, poles, pole lines, wires, switches, switch racks,
switchboards, insulators and other appliances and equipment, and all other
property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such transmission lines or any of them or
adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises and rights for or relating to the construction,
maintenance or operation thereof, through, over, under or upon any private
property or any public streets or highways, within as well as without the
corporate limits of any municipal corporation. Also all the real property,
rights of way, easements, permits, privileges and rights for or relating to the
construction, maintenance or operation of certain transmission lines, the land
and rights for which are owned by the Company, which are either not built or now
being constructed.

                                      III.

                          ELECTRIC DISTRIBUTION SYSTEMS

         All the electric distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including substations, transformers, switchboards,

                                      -13-

<PAGE>

towers, poles, wires, insulators, subways, trenches, conduits, manholes, cables,
meters and other appliances and equipment, and all other property, real or
personal, forming a part of or appertaining to or used, occupied or enjoyed in
connection with such distribution systems or any of them or adjacent thereto;
together with all real property, rights of way, easements, permits, privileges,
franchises, grants and rights, for or relating to the construction, maintenance
or operation thereof, through, over, under or upon any private property or any
public streets or highways within as well as without the corporate limits of any
municipal corporation.

                                       IV.

               ELECTRIC SUBSTATIONS, SWITCHING STATIONS AND SITES

         All the substations, switching stations and sites of the Company,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture, for transforming, regulating, converting or distributing or
otherwise controlling electric current at any of its plants and elsewhere,
together with all buildings, transformers, wires, insulators and other
appliances and equipment, and all other property, real or personal, forming a
part of or appertaining to or used, occupied or enjoyed in connection with any
of such substations and switching stations, or adjacent thereto, with sites to
be used for such purposes.

                                       V.

   GAS COMPRESSOR STATIONS, GAS PROCESSING PLANTS, DESULPHURIZATION STATIONS,
              METERING STATIONS, ODORIZING STATIONS, REGULATORS AND
                                      SITES

         All the compressor stations, processing plants, desulphurization
stations, metering stations, odorizing stations, regulators and sites of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
lien of the Indenture, for compressing, processing, desulphurizing, metering,
odorizing and regulating manufactured or natural gas at any of its plants and
elsewhere, together with all buildings, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with any of such
purposes, with sites to be used for such purposes.

                                       VI.

                               GAS STORAGE FIELDS

         The natural gas rights and interests of the Company, including wells
and well lines (but not including natural gas, oil and minerals), the gas
gathering system, the underground gas storage rights, the underground gas
storage wells and injection and withdrawal system used in connection therewith,
constructed or otherwise acquired by it and not heretofore described in the
Indenture or any supplement thereto and not heretofore released from the lien of
the Indenture: In the Overisel Gas Storage Field, located in the Township of
Overisel, Allegan County, and in the Township of Zeeland, Ottawa County,
Michigan; in the Northville Gas Storage Field located

                                      -14-

<PAGE>

in the Township of Salem, Washtenaw County, Township of Lyon, Oakland County,
and the Townships of Northville and Plymouth and City of Plymouth, Wayne County,
Michigan; in the Salem Gas Storage Field, located in the Township of Salem,
Allegan County, and in the Township of Jamestown, Ottawa County, Michigan; in
the Ray Gas Storage Field, located in the Townships of Ray and Armada, Macomb
County, Michigan; in the Lenox Gas Storage Field, located in the Townships of
Lenox and Chesterfield, Macomb County, Michigan; in the Ira Gas Storage Field,
located in the Township of Ira, St. Clair County, Michigan; in the Puttygut Gas
Storage Field, located in the Township of Casco, St. Clair County, Michigan; in
the Four Corners Gas Storage Field, located in the Townships of Casco, China,
Cottrellville and Ira, St. Clair County, Michigan; in the Swan Creek Gas Storage
Field, located in the Township of Casco and Ira, St. Clair County, Michigan; and
in the Hessen Gas Storage Field, located in the Townships of Casco and Columbus,
St. Clair, Michigan.

                                      VII.

                             GAS TRANSMISSION LINES

         All the gas transmission lines of the Company, constructed or otherwise
acquired by it and not heretofore described in the Indenture or any supplement
thereto and not heretofore released from the lien of the Indenture, including
gas mains, pipes, pipelines, gates, valves, meters and other appliances and
equipment, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such
transmission lines or any of them or adjacent thereto; together with all real
property, right of way, easements, permits, privileges, franchises and rights
for or relating to the construction, maintenance or operation thereof, through,
over, under or upon any private property or any public streets or highways,
within as well as without the corporate limits of any municipal corporation.

                                      VIII.

                            GAS DISTRIBUTION SYSTEMS

         All the gas distribution systems of the Company, constructed or
otherwise acquired by it and not heretofore described in the Indenture or any
supplement thereto and not heretofore released from the lien of the Indenture,
including tunnels, conduits, gas mains and pipes, service pipes, fittings,
gates, valves, connections, meters and other appliances and equipment, and all
other property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such distribution systems or any of them
or adjacent thereto; together with all real property, rights of way, easements,
permits, privileges, franchises, grants and rights, for or relating to the
construction, maintenance or operation thereof, through, over, under or upon any
private property or any public streets or highways within as well as without the
corporate limits of any municipal corporation.

                                      -15-

<PAGE>

                                       IX.

               OFFICE BUILDINGS, SERVICE BUILDINGS, GARAGES, ETC.

         All office, garage, service and other buildings of the Company,
wherever located, in the State of Michigan, constructed or otherwise acquired by
it and not heretofore described in the Indenture or any supplement thereto and
not heretofore released from the lien of the Indenture, together with the land
on which the same are situated and all easements, rights of way and
appurtenances to said lands, together with all furniture and fixtures located in
said buildings.

                                       X.

                            TELEPHONE PROPERTIES AND
                          RADIO COMMUNICATION EQUIPMENT

         All telephone lines, switchboards, systems and equipment of the
Company, constructed or otherwise acquired by it and not heretofore described in
the Indenture or any supplement thereto and not heretofore released from the
line of the Indenture, used or available for use in the operation of its
properties, and all other property, real or personal, forming a part of or
appertaining to or used, occupied or enjoyed in connection with such telephone
properties or any of them or adjacent thereto; together with all real estate,
rights of way, easements, permits, privileges, franchises, property, devices or
rights related to the dispatch, transmission, reception or reproduction of
messages, communications, intelligence, signals, light, vision or sound by
electricity, wire or otherwise, including all telephone equipment installed in
buildings used as general and regional offices, substations and generating
stations and all telephone lines erected on towers and poles; and all radio
communication equipment of the Company, together with all property, real or
personal (except any in the Indenture expressly excepted), fixed stations,
towers, auxiliary radio buildings and equipment, and all appurtenances used in
connection therewith, wherever located, in the State of Michigan.

                                       XI.

                               OTHER REAL PROPERTY

         All other real property of the Company and all interests therein, of
every nature and description (except any in the Indenture expressly excepted)
wherever located, in the State of Michigan, acquired by it and not heretofore
described in the Indenture or any supplement thereto and not heretofore released
from the line of the Indenture. Such real property includes but is not limited
to the following described property, such property is subject to any interests
that were excepted or reserved in the conveyance to the Company:

                                  ALCONA COUNTY

         Certain land in Caledonia Township, Alcona County, Michigan described
         as:

                  The East 330 feet of the South 660 feet of the SW 1/4 of the
         SW 1/4 of Section 8, T28N, R8E, except the West 264 feet of the South
         330 feet thereof; said land being more particularly described as
         follows: To find the place of

                                      -16-

<PAGE>

         beginning of this description, commence at the Southwest corner of said
         section, run thence East along the South line of said section 1243 feet
         to the place of beginning of this description, thence continuing East
         along said South line of said section 66 feet to the West 1/8 line of
         said section, thence N 02 degrees 09' 30" E along the said West 1/8
         line of said section 660 feet, thence West 330 feet, thence S 02
         degrees 09' 30" W, 330 feet, thence East 264 feet, thence S 02 degrees
         09' 30" W, 330 feet to the place of beginning.

                                 ALLEGAN COUNTY

         Certain land in Lee Township, Allegan County, Michigan described as:

                  The NE 1/4 of the NW 1/4 of Section 16, T1N, R15W.

                                  ALPENA COUNTY

         Certain land in Wilson and Green Townships, Alpena County, Michigan
described as:

                  All that part of the S'ly 1/2 of the former Boyne City-Gaylord
         and Alpena Railroad right of way, being the Southerly 50 feet of a 100
         foot strip of land formerly occupied by said Railroad, running from the
         East line of Section 31, T31N, R7E, Southwesterly across said Section
         31 and Sections 5 and 6 of T30N, R7E and Sections 10, 11 and the E 1/2
         of Section 9, except the West 1646 feet thereof, all in T30N, R6E.

                                  ANTRIM COUNTY

         Certain land in Mancelona Township, Antrim County, Michigan described
as:

                  The S 1/2 of the NE 1/4 of Section 33, T29N, R6W, excepting
         therefrom all mineral, coal, oil and gas and such other rights as were
         reserved unto the State of Michigan in that certain deed running from
         the State of Michigan to August W. Schack and Emma H. Schack, his wife,
         dated April 15, 1946 and recorded May 20, 1946 in Liber 97 of Deeds on
         page 682 of Antrim County Records.

                                  ARENAC COUNTY

         Certain land in Standish Township, Arenac County, Michigan described
as:

                  A parcel of land in the SW 1/4 of the NW 1/4 of Section 12,
         T18N, R4E, described as follows: To find the place of beginning of said
         parcel of land, commence at the Northwest corner of Section 12, T18N,
         R4E; run thence South along the West line of said section, said West
         line of said section being also the center line of East City Limits
         Road 2642.15 feet to the W 1/4 post of said section and the place of
         beginning of said parcel of land; running thence N 88 degrees 26' 00" E
         along the East and West 1/4 line of said section, 660.0 feet; thence
         North parallel with the West line of said section, 310.0 feet; thence S
         88 degrees 26' 00"

                                      -17-

<PAGE>

         W, 330.0 feet; thence South parallel with the West line of said
         section, 260.0 feet; thence S 88 degrees 26' 00" W, 330.0 feet to the
         West line of said section and the center line of East City Limits Road;
         thence South along the said West line of said section, 50.0 feet to the
         place of beginning.

                                  BARRY COUNTY

         Certain land in Johnstown Township, Barry County, Michigan described
as:

                  A strip of land 311 feet in width across the SW 1/4 of the NE
         1/4 of Section 31, T1N, R8W, described as follows: To find the place of
         beginning of this description, commence at the E 1/4 post of said
         section; run thence N 00 degrees 55' 00" E along the East line of said
         section, 555.84 feet; thence N 59 degrees 36' 20" W, 1375.64 feet;
         thence N 88 degrees 30' 00" W, 130 feet to a point on the East 1/8 line
         of said section and the place of beginning of this description; thence
         continuing N 88 degrees 30' 00" W, 1327.46 feet to the North and South
         1/4 line of said section; thence S 00 degrees 39'35" W along said North
         and South 1/4 line of said section, 311.03 feet to a point, which said
         point is 952.72 feet distant N'ly from the East and West 1/4 line of
         said section as measured along said North and South 1/4 line of said
         section; thence S 88 degrees 30' 00" E, 1326.76 feet to the East 1/8
         line of said section; thence N 00 degrees 47' 20" E along said East 1/8
         line of said section, 311.02 feet to the place of beginning.

                                   BAY COUNTY

         Certain land in Frankenlust Township, Bay County, Michigan described
as:

                  The South 250 feet of the N 1/2 of the W 1/2 of the W 1/2 of
         the SE 1/4 of Section 9, T13N, R4E.

                                  BENZIE COUNTY

         Certain land in Benzonia Township, Benzie County, Michigan described
as:

                  A parcel of land in the Northeast 1/4 of Section 7, Township
         26 North, Range 14 West, described as beginning at a point on the East
         line of said Section 7, said point being 320 feet North measured along
         the East line of said section from the East 1/4 post; running thence
         West 165 feet; thence North parallel with the East line of said section
         165 feet; thence East 165 feet to the East line of said section; thence
         South 165 feet to the place of beginning.

                                  BRANCH COUNTY

         Certain land in Girard Township, Branch County, Michigan described as:

                  A parcel of land in the NE 1/4 of Section 23 T5S, R6W,
         described as beginning at a point on the North and South quarter line
         of said section at a point

                                      -18-

<PAGE>

         1278.27 feet distant South of the North quarter post of said section,
         said distance being measured along the North and South quarter line of
         said section, running thence S89 degrees21'E 250 feet, thence North
         along a line parallel with the said North and South quarter line of
         said section 200 feet, thence N89 degrees21'W 250 feet to the North and
         South quarter line of said section, thence South along said North and
         South quarter line of said section 200 feet to the place of beginning.

                                 CALHOUN COUNTY

         Certain land in Convis Township, Calhoun County, Michigan described as:

                  A parcel of land in the SE 1/4 of the SE 1/4 of Section 32,
         T1S, R6W, described as follows: To find the place of beginning of this
         description, commence at the Southeast corner of said section; run
         thence North along the East line of said section 1034.32 feet to the
         place of beginning of this description; running thence N 89 degrees 39'
         52" W, 333.0 feet; thence North 290.0 feet to the South 1/8 line of
         said section; thence S 89 degrees 39' 52" E along said South 1/8 line
         of said section 333.0 feet to the East line of said section; thence
         South along said East line of said section 290.0 feet to the place of
         beginning. (Bearings are based on the East line of Section 32, T1S,
         R6W, from the Southeast corner of said section to the Northeast corner
         of said section assumed as North.)

                                   CASS COUNTY

         Certain easement rights located across land in Marcellus Township, Cass
County, Michigan described as:

                  The East 6 rods of the SW 1/4 of the SE 1/4 of Section 4, T5S,
         R13W.

                                CHARLEVOIX COUNTY

         Certain land in South Arm Township, Charlevoix County, Michigan
described as:

                  A parcel of land in the SW 1/4 of Section 29, T32N, R7W,
         described as follows: Beginning at the Southwest corner of said section
         and running thence North along the West line of said section 788.25
         feet to a point which is 528 feet distant South of the South 1/8 line
         of said section as measured along the said West line of said section;
         thence N 89 degrees 30' 19" E, parallel with said South 1/8 line of
         said section 442.1 feet; thence South 788.15 feet to the South line of
         said section; thence S 89 degrees 29' 30" W, along said South line of
         said section 442.1 feet to the place of beginning.

                                      -19-

<PAGE>

                                CHEBOYGAN COUNTY

         Certain land in Inverness Township, Cheboygan County, Michigan
described as:

                  A parcel of land in the SW frl 1/4 of Section 31, T37N, R2W,
         described as beginning at the Northwest corner of the SW frl 1/4,
         running thence East on the East and West quarter line of said Section,
         40 rods, thence South parallel to the West line of said Section 40
         rods, thence West 40 rods to the West line of said Section, thence
         North 40 rods to the place of beginning.

                                  CLARE COUNTY

         Certain land in Frost Township, Clare County, Michigan described as:

                  The East 150 feet of the North 225 feet of the NW 1/4 of the
         NW 1/4 of Section 15, T20N, R4W.

                                 CLINTON COUNTY

         Certain land in Watertown Township, Clinton County, Michigan described
as:

                  The NE 1/4 of the NE 1/4 of the SE 1/4 of Section 22, and the
         North 165 feet of the NW 1/4 of the NE 1/4 of the SE 1/4 of Section 22,
         T5N, R3W.

                                 CRAWFORD COUNTY

         Certain land in Lovells Township, Crawford County, Michigan described
as:

                  A parcel of land in Section 1, T28N, R1W, described as:
         Commencing at NW corner said section; thence South 89 degrees53'30"
         East along North section line 105.78 feet to point of beginning; thence
         South 89 degrees53'30" East along North section line 649.64 feet;
         thence South 55 degrees 42'30" East 340.24 feet; thence South 55
         degrees 44' 37"" East 5,061.81 feet to the East section line; thence
         South 00 degrees 00' 08"" West along East section line 441.59 feet;
         thence North 55 degrees 44' 37" West 5,310.48 feet; thence North 55
         degrees 42'30" West 877.76 feet to point of beginning.

                                  EATON COUNTY

         Certain land in Eaton Township, Eaton County, Michigan described as:

                  A parcel of land in the SW 1/4 of Section 6, T2N, R4W,
         described as follows: To find the place of beginning of this
         description commence at the Southwest corner of said section; run
         thence N 89 degrees 51' 30" E along the South line of said section 400
         feet to the place of beginning of this description; thence continuing N
         89 degrees 51' 30" E, 500 feet; thence N 00 degrees 50' 00" W, 600
         feet; thence S 89 degrees 51' 30" W parallel with the South line of
         said

                                      -20-

<PAGE>

         section 500 feet; thence S 00 degrees 50' 00" E, 600 feet to the place
         of beginning.

                                  EMMET COUNTY

         Certain land in Wawatam Township, Emmet County, Michigan described as:

                  The West 1/2 of the Northeast 1/4 of the Northeast 1/4 of
         Section 23, T39N, R4W.

                                 GENESEE COUNTY

         Certain land in Argentine Township, Genesee County, Michigan described
as:

                  A parcel of land of part of the SW 1/4 of Section 8, T5N, R5E,
         being more particularly described as follows:

                  Beginning at a point of the West line of Duffield Road, 100
         feet wide, (as now established) distant 829.46 feet measured N01
         degrees42'56"W and 50 feet measured S88 degrees14'04"W` from the South
         quarter corner, Section 8, T5N, R5E; thence S88 degrees14'04"W a
         distance of 550 feet; thence N01 degrees42'56"W a distance of 500 feet
         to a point on the North line of the South half of the Southwest quarter
         of said Section 8; thence N88 degrees14'04"E along the North line of
         South half of the Southwest quarter of said Section 8 a distance 550
         feet to a point on the West line of Duffield Road, 100 feet wide (as
         now established); thence S01 degrees42'56"E along the West line of said
         Duffield Road a distance of 500 feet to the point of beginning.

                                 GLADWIN COUNTY

         Certain land in Secord Township, Gladwin County, Michigan described as:

                  The East 400 feet of the South 450 feet of Section 2, T19N,
         R1E.

                              GRAND TRAVERSE COUNTY

         Certain land in Mayfield Township, Grand Traverse County, Michigan
         described as:

                  A parcel of land in the Northwest 1/4 of Section 3, T25N,
         R11W, described as follows: Commencing at the Northwest corner of said
         section, running thence S 89 degrees19'15" E along the North line of
         said section and the center line of Clouss Road 225 feet, thence South
         400 feet, thence N 89 degrees19'15" W 225 feet to the West line of said
         section and the center line of Hannah Road, thence North along the West
         line of said section and the center line of Hannah Road 400 feet to the
         place of beginning for this description.

                                      -21-

<PAGE>

                                 GRATIOT COUNTY

         Certain land in Fulton Township, Gratiot County, Michigan described as:

                  A parcel of land in the NE 1/4 of Section 7, Township 9 North,
         Range 3 West, described as beginning at a point on the North line of
         George Street in the Village of Middleton, which is 542 feet East of
         the North and South one-quarter (1/4) line of said Section 7; thence
         North 100 feet; thence East 100 feet; thence South 100 feet to the
         North line of George Street; thence West along the North line of George
         Street 100 feet to place of beginning.

                                HILLSDALE COUNTY

         Certain land in Litchfield Village, Hillsdale County, Michigan
described as:

                  Lot 238 of Block three (3) of Assessors Plat of the Village of
         Litchfield.

                                  HURON COUNTY

         Certain easement rights located across land in Sebewaing Township,
Huron County, Michigan described as:

                  The North 1/2 of the Northwest 1/4 of Section 15, T15N, R9E.

                                  INGHAM COUNTY

         Certain land in Vevay Township, Ingham County, Michigan described as:

                  A parcel of land 660 feet wide in the Southwest 1/4 of Section
         7 lying South of the centerline of Sitts Road as extended to the
         North-South 1/4 line of said Section 7, T2N, R1W, more particularly
         described as follows: Commence at the Southwest corner of said Section
         7, thence North along the West line of said Section 2502.71 feet to the
         centerline of Sitts Road; thence South 89 degrees54'45" East along said
         centerline 2282.38 feet to the place of beginning of this description;
         thence continuing South 89 degrees54'45" East along said centerline and
         said centerline extended 660.00 feet to the North-South 1/4 line of
         said section; thence South 00 degrees07'20" West 1461.71 feet; thence
         North 89 degrees34'58" West 660.00 feet; thence North 00 degrees07'20"
         East 1457.91 feet to the centerline of Sitts Road and the place of
         beginning.

                                  IONIA COUNTY

         Certain land in Sebewa Township, Ionia County, Michigan described as:

                  A strip of land 280 feet wide across that part of the SW 1/4
         of the NE 1/4 of Section 15, T5N, R6W, described as follows:

                                      -22-

<PAGE>

                  To find the place of beginning of this description commence at
         the E 1/4 corner of said section; run thence N 00 degrees 05' 38" W
         along the East line of said section, 1218.43 feet; thence S 67 degrees
         18' 24" W, 1424.45 feet to the East 1/8 line of said section and the
         place of beginning of this description; thence continuing S 67 degrees
         18' 24" W, 1426.28 feet to the North and South 1/4 line of said section
         at a point which said point is 105.82 feet distant N'ly of the center
         of said section as measured along said North and South 1/4 line of said
         section; thence N 00 degrees 04' 47" E along said North and South 1/4
         line of said section, 303.67 feet; thence N 67 degrees 18' 24" E,
         1425.78 feet to the East 1/8 line of said section; thence S 00 degrees
         00' 26" E along said East 1/8 line of said section, 303.48 feet to the
         place of beginning. (Bearings are based on the East line of Section 15,
         T5N, R6W, from the E 1/4 corner of said section to the Northeast corner
         of said section assumed as N 00 degrees 05' 38" W.)

                                  IOSCO COUNTY

         Certain land in Alabaster Township, Iosco County, Michigan described
as:

                  A parcel of land in the NW 1/4 of Section 34, T21N, R7E,
         described as follows: To find the place of beginning of this
         description commence at the N 1/4 post of said section; run thence
         South along the North and South 1/4 line of said section, 1354.40 feet
         to the place of beginning of this description; thence continuing South
         along the said North and South 1/4 line of said section, 165.00 feet to
         a point on the said North and South 1/4 line of said section which said
         point is 1089.00 feet distant North of the center of said section;
         thence West 440.00 feet; thence North 165.00 feet; thence East 440.00
         feet to the said North and South 1/4 line of said section and the place
         of beginning.

                                 ISABELLA COUNTY

         Certain land in Chippewa Township, Isabella County, Michigan described
as:

                  The North 8 rods of the NE 1/4 of the SE 1/4 of Section 29,
         T14N, R3W.

                                 JACKSON COUNTY

         Certain land in Waterloo Township, Jackson County, Michigan described
as:

                  A parcel of land in the North fractional part of the N
         fractional 1/2 of Section 2, T1S, R2E, described as follows: To find
         the place of beginning of this description commence at the E 1/4 post
         of said section; run thence N 01 degrees 03' 40" E along the East line
         of said section 1335.45 feet to the North 1/8 line of said section and
         the place of beginning of this description; thence N 89 degrees 32' 00"
         W, 2677.7 feet to the North and South 1/4 line of said section; thence
         S 00 degrees 59' 25" W along the North and South 1/4 line of said
         section 22.38 feet to the North 1/8 line of said section; thence S 89
         degrees 59' 10" W along the North 1/8 line of said section 2339.4 feet
         to the center line of State Trunkline Highway M-52; thence N 53 degrees
         46' 00" W along the center line of said State

                                      -23-

<PAGE>

         Trunkline Highway 414.22 feet to the West line of said section; thence
         N 00 degrees 55' 10" E along the West line of said section 74.35 feet;
         thence S 89 degrees 32' 00" E, 5356.02 feet to the East line of said
         section; thence S 01 degrees 03' 40" W along the East line of said
         section 250 feet to the place of beginning.

                                KALAMAZOO COUNTY

         Certain land in Alamo Township, Kalamazoo County, Michigan described
as:

                  The South 350 feet of the NW 1/4 of the NW 1/4 of Section 16,
         T1S, R12W, being more particularly described as follows: To find the
         place of beginning of this description, commence at the Northwest
         corner of said section; run thence S 00 degrees 36' 55" W along the
         West line of said section 971.02 feet to the place of beginning of this
         description; thence continuing S 00 degrees 36' 55" W along said West
         line of said section 350.18 feet to the North 1/8 line of said section;
         thence S 87 degrees 33' 40" E along the said North 1/8 line of said
         section 1325.1 feet to the West 1/8 line of said section; thence N 00
         degrees 38' 25" E along the said West 1/8 line of said section 350.17
         feet; thence N 87 degrees 33' 40" W, 1325.25 feet to the place of
         beginning.

                                 KALKASKA COUNTY

         Certain land in Kalkaska Township, Kalkaska County, Michigan described
as:

                  The NW 1/4 of the SW 1/4 of Section 4, T27N, R7W, excepting
         therefrom all mineral, coal, oil and gas and such other rights as were
         reserved unto the State of Michigan in that certain deed running from
         the Department of Conservation for the State of Michigan to George
         Welker and Mary Welker, his wife, dated October 9, 1934 and recorded
         December 28, 1934 in Liber 39 on page 291 of Kalkaska County Records,
         and subject to easement for pipeline purposes as granted to Michigan
         Consolidated Gas Company by first party herein on April 4, 1963 and
         recorded June 21, 1963 in Liber 91 on page 631 of Kalkaska County
         Records.

                                   KENT COUNTY

         Certain land in Caledonia Township, Kent County, Michigan described as:

                  A parcel of land in the Northwest fractional 1/4 of Section
         15, T5N, R10W, described as follows: To find the place of beginning of
         this description commence at the North 1/4 corner of said section, run
         thence S 0 degrees 59' 26" E along the North and South 1/4 line of said
         section 2046.25 feet to the place of beginning of this description,
         thence continuing S 0 degrees 59' 26" E along said North and South 1/4
         line of said section 332.88 feet, thence S 88 degrees 58' 30" W 2510.90
         feet to a point herein designated "Point A" on the East bank of the
         Thornapple River, thence continuing S 88 degrees 53' 30" W to the
         center thread of the Thornapple River, thence NW'ly along the center
         thread of said Thornapple

                                      -24-

<PAGE>

         River to a point which said point is S 88 degrees 58' 30" W of a point
         on the East bank of the Thornapple River herein designated "Point B",
         said "Point B" being N 23 degrees 41' 35" W 360.75 feet from said
         above-described "Point A", thence N 88 degrees 58' 30" E to said "Point
         B", thence continuing N 88 degrees 58' 30" E 2650.13 feet to the place
         of beginning. (Bearings are based on the East line of Section 15, T5N,
         R10W between the East 1/4 corner of said section and the Northeast
         corner of said section assumed as N 0 degrees 59' 55" W.)

                                   LAKE COUNTY

         Certain land in Pinora and Cherry Valley Townships, Lake County,
Michigan described as:

                  A strip of land 50 feet wide East and West along and adjoining
         the West line of highway on the East side of the North 1/2 of Section
         13 T18N, R12W. Also a strip of land 100 feet wide East and West along
         and adjoining the East line of the highway on the West side of
         following described land: The South 1/2 of NW 1/4, and the South 1/2 of
         the NW 1/4 of the SW 1/4, all in Section 6, T18N, R11W.

                                  LAPEER COUNTY

         Certain land in Hadley Township, Lapeer County, Michigan described as:

                  The South 825 feet of the W 1/2 of the SW 1/4 of Section 24,
         T6N, R9E, except the West 1064 feet thereof.

                                 LEELANAU COUNTY

         Certain land in Cleveland Township, Leelanau County, Michigan described
as:

                  The North 200 feet of the West 180 feet of the SW 1/4 of the
         SE 1/4 of Section 35, T29N, R13W.

                                 LENAWEE COUNTY

         Certain land in Madison Township, Lenawee County, Michigan described
as:

                  A strip of land 165 feet wide off the West side of the
         following described premises: The E 1/2 of the SE 1/4 of Section 12.
         The E 1/2 of the NE 1/4 and the NE 1/4 of the SE 1/4 of Section 13,
         being all in T7S, R3E, excepting therefrom a parcel of land in the E
         1/2 of the SE 1/4 of Section 12, T7S, R3E, beginning at the Northwest
         corner of said E 1/2 of the SE 1/4 of Section 12, running thence East 4
         rods, thence South 6 rods, thence West 4 rods, thence North 6 rods to
         the place of beginning.

                                      -25-

<PAGE>

                                LIVINGSTON COUNTY

         Certain land in Cohoctah Township, Livingston County, Michigan
described as:

                  Parcel 1

                  The East 390 feet of the East 50 rods of the SW 1/4 of Section
         30, T4N, R4E.

                  Parcel 2

                  A parcel of land in the NW 1/4 of Section 31, T4N, R4E,
         described as follows: To find the place of beginning of this
         description commence at the N 1/4 post of said section; run thence N 89
         degrees 13' 06" W along the North line of said section, 330 feet to the
         place of beginning of this description; running thence S 00 degrees 52'
         49" W, 2167.87 feet; thence N 88 degrees 59' 49" W, 60 feet; thence N
         00 degrees 52' 49" E, 2167.66 feet to the North line of said section;
         thence S 89 degrees 13' 06" E along said North line of said section, 60
         feet to the place of beginning.

                                  MACOMB COUNTY

         Certain land in Macomb Township, Macomb County, Michigan described as:

                  A parcel of land commencing on the West line of the E 1/2 of
         the NW 1/4 of fractional Section 6, 20 chains South of the NW corner of
         said E 1/2 of the NW 1/4 of Section 6; thence South on said West line
         and the East line of A. Henry Kotner's Hayes Road Subdivision #15,
         according to the recorded plat thereof, as recorded in Liber 24 of
         Plats, on page 7, 24.36 chains to the East and West 1/4 line of said
         Section 6; thence East on said East and West 1/4 line 8.93 chains;
         thence North parallel with the said West line of the E 1/2 of the NW
         1/4 of Section 6, 24.36 chains; thence West 8.93 chains to the place of
         beginning, all in T3N, R13E.

                                 MANISTEE COUNTY

         Certain land in Manistee Township, Manistee County, Michigan described
as:

                  A parcel of land in the SW 1/4 of Section 20, T22N, R16W,
         described as follows: To find the place of beginning of this
         description, commence at the Southwest corner of said section; run
         thence East along the South line of said section 832.2 feet to the
         place of beginning of this description; thence continuing East along
         said South line of said section 132 feet; thence North 198 feet; thence
         West 132 feet; thence South 198 feet to the place of beginning,
         excepting therefrom the South 2 rods thereof which was conveyed to
         Manistee Township for highway purposes by a Quitclaim Deed dated June
         13, 1919 and recorded July [11], 1919 in Liber 88 of Deeds on page 638
         of Manistee County Records.

                                      -26-

<PAGE>

                                  MASON COUNTY

         Certain land in Riverton Township, Mason County, Michigan described as:

Parcel 1

                  The South 10 acres of the West 20 acres of the S 1/2 of the NE
         1/4 of Section 22, T17N, R17W.

Parcel 2

                  A parcel of land containing 4 acres of the West side of
         highway, said parcel of land being described as commencing 16 rods
         South of the Northwest corner of the NW 1/4 of the SW 1/4 of Section
         22, T17N, R17W, running thence South 64 rods, thence NE'ly and N'ly and
         NW'ly along the W'ly line of said highway to the place of beginning,
         together with any and all right, title, and interest of Howard C.
         Wicklund and Katherine E. Wicklund in and to that portion of the
         hereinbefore mentioned highway lying adjacent to the E'ly line of said
         above described land.

                                 MECOSTA COUNTY

         Certain land in Wheatland Township, Mecosta County, Michigan described
as:

                  A parcel of land in the SW 1/4 of the SW 1/4 of Section 16,
         T14N, R7W, described as beginning at the Southwest corner of said
         section; thence East along the South line of Section 133 feet; thence
         North parallel to the West section line 133 feet; thence West 133 feet
         to the West line of said Section; thence South 133 feet to the place of
         beginning.

                                 MIDLAND COUNTY

         Certain land in Ingersoll Township, Midland County, Michigan described
as:

                  The West 200 feet of the W 1/2 of the NE 1/4 of Section 4,
         T13N, R2E.

                                MISSAUKEE COUNTY

         Certain land in Norwich Township, Missaukee County, Michigan described
as:

                  A parcel of land in the NW 1/4 of the NW 1/4 of Section 16,
         T24N, R6W, described as follows: Commencing at the Northwest corner of
         said section, running thence N 89 degrees 01' 45" E along the North
         line of said section 233.00 feet; thence South 233.00 feet; thence S 89
         degrees 01' 45" W, 233.00 feet to the West line of said section; thence
         North along said West line of said section 233.00 feet to the place of
         beginning. (Bearings are based on the West line of Section 16, T24N,
         R6W, between the Southwest and Northwest corners of said section
         assumed as North.)

                                      -27-

<PAGE>

                                  MONROE COUNTY

         Certain land in Whiteford Township, Monroe County, Michigan described
as:

                  A parcel of land in the SW1/4 of Section 20, T8S, R6E,
         described as follows: To find the place of beginning of this
         description commence at the S 1/4 post of said section; run thence West
         along the South line of said section 1269.89 feet to the place of
         beginning of this description; thence continuing West along said South
         line of said section 100 feet; thence N 00 degrees 50' 35" E, 250 feet;
         thence East 100 feet; thence S 00 degrees 50' 35" W parallel with and
         16.5 feet distant W'ly of as measured perpendicular to the West 1/8
         line of said section, as occupied, a distance of 250 feet to the place
         of beginning.

                                 MONTCALM COUNTY

         Certain land in Crystal Township, Montcalm County, Michigan described
as:

                  The N 1/2 of the S 1/2 of the SE 1/4 of Section 35, T10N, R5W.

                               MONTMORENCY COUNTY

         Certain land in the Village of Hillman, Montmorency County, Michigan
described as:

                  Lot 14 of Hillman Industrial Park, being a subdivision in the
         South 1/2 of the Northwest 1/4 of Section 24, T31N, R4E, according to
         the plat thereof recorded in Liber 4 of Plats on Pages 32-34,
         Montmorency County Records.

                                 MUSKEGON COUNTY

         Certain land in Casnovia Township, Muskegon County, Michigan described
as:

                  The West 433 feet of the North 180 feet of the South 425 feet
         of the SW 1/4 of Section 3, T10N, R13W.

                                 NEWAYGO COUNTY

         Certain land in Ashland Township, Newaygo County, Michigan described
as:

                  The West 250 feet of the NE 1/4 of Section 23, T11N, R13W.

                                 OAKLAND COUNTY

         Certain land in Wixcom City, Oakland County, Michigan described as:

                  The E 75 feet of the N 160 feet of the N 330 feet of the W
         526.84 feet of the NW 1/4 of the NW 1/4 of Section 8, T1N, R8E, more
         particularly described as follows: Commence at the NW corner of said
         Section 8, thence N 87 degrees 14' 29" E along the North line of said
         Section 8 a distance of 451.84 feet to the place

                                      -28-

<PAGE>

         of beginning for this description; thence continuing N 87 degrees 14'
         29" E along said North section line a distance of 75.0 feet to the East
         line of the West 526.84 feet of the NW 1/4 of the NW 1/4 of said
         Section 8; thence S 02 degrees 37' 09" E along said East line a
         distance of 160.0 feet; thence S 87 degrees 14' 29" W a distance of
         75.0 feet; thence N 02 degrees 37' 09" W a distance of 160.0 feet to
         the place of beginning.

                                  OCEANA COUNTY

         Certain land in Crystal Township, Oceana County, Michigan described as:

                  The East 290 feet of the SE 1/4 of the NW 1/4 and the East 290
         feet of the NE 1/4 of the SW 1/4, all in Section 20, T16N, R16W.

                                  OGEMAW COUNTY

         Certain land in West Branch Township, Ogemaw County, Michigan described
as:

                  The South 660 feet of the East 660 feet of the NE 1/4 of the
         NE 1/4 of Section 33, T22N, R2E.

                                 OSCEOLA COUNTY

         Certain land in Hersey Township, Osceola County, Michigan described as:

                  A parcel of land in the North 1/2 of the Northeast 1/4 of
         Section 13, T17N, R9W, described as commencing at the Northeast corner
         of said Section; thence West along the North Section line 999 feet to
         the point of beginning of this description; thence S 01 degrees 54' 20"
         E 1327.12 feet to the North 1/8 line; thence S 89 degrees 17' 05" W
         along the North 1/8 line 330.89 feet; thence N 01 degrees 54' 20" W
         1331.26 feet to the North Section line; thence East along the North
         Section line 331 feet to the point of beginning.

                                  OSCODA COUNTY

         Certain land in Comins Township, Oscoda County, Michigan described as:

                  The East 400 feet of the South 580 feet of the W 1/2 of the SW
         1/4 of Section 15, T27N, R3E.

                                  OTSEGO COUNTY

         Certain land in Corwith Township, Otsego County, Michigan described as:

                  Part of the NW 1/4 of the NE 1/4 of Section 28, T32N, R3W,
         described as: Beginning at the N 1/4 corner of said section; running
         thence S 89 degrees 04' 06" E along the North line of said section,
         330.00 feet; thence S 00 degrees 28' 43" E, 400.00 feet; thence N 89
         degrees 04' 06" W, 330.00 feet to the North and

                                      -29-

<PAGE>

         South 1/4 line of said section; thence N 00 degrees 28' 43" W along the
         said North and South 1/4 line of said section, 400.00 feet to the point
         of beginning; subject to the use of the N'ly 33.00 feet thereof for
         highway purposes.

                                  OTTAWA COUNTY

         Certain land in Robinson Township, Ottawa County, Michigan described
as:

                  The North 660 feet of the West 660 feet of the NE 1/4 of the
         NW 1/4 of Section 26, T7N, R15W.

                               PRESQUE ISLE COUNTY

         Certain land in Belknap and Pulawski Townships, Presque Isle County,
Michigan described as:

                  Part of the South half of the Northeast quarter, Section 24,
         T34N, R5E, and part of the Northwest quarter, Section 19, T34N, R6E,
         more fully described as: Commencing at the East 1/4 corner of said
         Section 24; thence N 00 degrees15'47" E, 507.42 feet, along the East
         line of said Section 24 to the point of beginning; thence S 88
         degrees15'36" W, 400.00 feet, parallel with the North 1/8 line of said
         Section 24; thence N 00 degrees15'47" E, 800.00 feet, parallel with
         said East line of Section 24; thence N 88 degrees15'36"E, 800.00 feet,
         along said North 1/8 line of Section 24 and said line extended; thence
         S 00 degrees15'47" W, 800.00 feet, parallel with said East line of
         Section 24; thence S 88 degrees15'36" W, 400.00 feet, parallel with
         said North 1/8 line of Section 24 to the point of beginning.

                  Together with a 33 foot easement along the West 33 feet of the
         Northwest quarter lying North of the North 1/8 line of Section 24,
         Belknap Township, extended, in Section 19, T34N, R6E.

                                ROSCOMMON COUNTY

         Certain land in Gerrish Township, Roscommon County, Michigan described
as:

                  A parcel of land in the NW 1/4 of Section 19, T24N, R3W,
         described as follows: To find the place of beginning of this
         description commence at the Northwest corner of said section, run
         thence East along the North line of said section 1,163.2 feet to the
         place of beginning of this description (said point also being the place
         of intersection of the West 1/8 line of said section with the North
         line of said section), thence S 01 degrees 01' E along said West 1/8
         line 132 feet, thence West parallel with the North line of said section
         132 feet, thence N 01 degrees 01' W parallel with said West 1/8 line of
         said section 132 feet to the North line of said section, thence East
         along the North line of said section 132 feet to the place of
         beginning.

                                      -30-

<PAGE>

                                 SAGINAW COUNTY

         Certain land in Chapin Township, Saginaw County, Michigan described as:

                  A parcel of land in the SW 1/4 of Section 13, T9N, R1E,
         described as follows: To find the place of beginning of this
         description commence at the Southwest corner of said section; run
         thence North along the West line of said section 1581.4 feet to the
         place of beginning of this description; thence continuing North along
         said West line of said section 230 feet to the center line of a creek;
         thence S 70 degrees 07' 00" E along said center line of said creek
         196.78 feet; thence South 163.13 feet; thence West 185 feet to the West
         line of said section and the place of beginning.

                                 SANILAC COUNTY

         Certain easement rights located across land in Minden Township, Sanilac
County, Michigan described as:

                  The Southeast 1/4 of the Southeast 1/4 of Section 1, T14N,
         R14E, excepting therefrom the South 83 feet of the East 83 feet
         thereof.

                                SHIAWASSEE COUNTY

         Certain land in Burns Township, Shiawassee County, Michigan described
as:

                  The South 330 feet of the E 1/2 of the NE 1/4 of Section 36,
         T5N, R4E.

                                ST. CLAIR COUNTY

         Certain land in Ira Township, St. Clair County, Michigan described as:

                  The N 1/2 of the NW 1/4 of the NE 1/4 of Section 6, T3N, R15E.

                                ST. JOSEPH COUNTY

         Certain land in Mendon Township, St. Joseph County, Michigan described
as:

                  The North 660 feet of the West 660 feet of the NW 1/4 of SW
         1/4, Section 35, T5S, R10W.

                                 TUSCOLA COUNTY

         Certain land in Millington Township, Tuscola County, Michigan described
as:

                  A strip of land 280 feet wide across the East 96 rods of the
         South 20 rods of the N 1/2 of the SE 1/4 of Section 34, T10N, R8E, more
         particularly described as commencing at the Northeast corner of Section
         3, T9N, R8E, thence S 89 degrees 55' 35" W along the South line of said
         Section 34 a distance of 329.65 feet, thence N 18 degrees 11' 50" W a
         distance of 1398.67 feet to the South 1/8

                                      -31-

<PAGE>

         line of said Section 34 and the place of beginning for this
         description; thence continuing N 18 degrees 11' 50" W a distance of
         349.91 feet; thence N 89 degrees 57' 01" W a distance of 294.80 feet;
         thence S 18 degrees 11' 50" E a distance of 350.04 feet to the South
         1/8 line of said Section 34; thence S 89 degrees 58' 29" E along the
         South 1/8 line of said section a distance of 294.76 feet to the place
         of beginning.

                                VAN BUREN COUNTY

         Certain land in Covert Township, Van Buren County, Michigan described
as:

                  All that part of the West 20 acres of the N 1/2 of the NE
         fractional 1/4 of Section 1, T2S, R17W, except the West 17 rods of the
         North 80 rods, being more particularly described as follows: To find
         the place of beginning of this description commence at the N 1/4 post
         of said section; run thence N 89 degrees 29' 20" E along the North line
         of said section 280.5 feet to the place of beginning of this
         description; thence continuing N 89 degrees 29' 20" E along said North
         line of said section 288.29 feet; thence S 00 degrees 44' 00" E,
         1531.92 feet; thence S 89 degrees 33' 30" W, 568.79 feet to the North
         and South 1/4 line of said section; thence N 00 degrees 44' 00" W along
         said North and South 1/4 line of said section 211.4 feet; thence N 89
         degrees 29' 20" E, 280.5 feet; thence N 00 degrees 44' 00" W, 1320 feet
         to the North line of said section and the place of beginning.

                                WASHTENAW COUNTY

         Certain land in Manchester Township, Washtenaw County, Michigan
described as:

                  A parcel of land in the NE 1/4 of the NW 1/4 of Section 1,
         T4S, R3E, described as follows: To find the place of beginning of this
         description commence at the Northwest corner of said section; run
         thence East along the North line of said section 1355.07 feet to the
         West 1/8 line of said section; thence S 00 degrees 22' 20" E along said
         West 1/8 line of said section 927.66 feet to the place of beginning of
         this description; thence continuing S 00 degrees 22' 20" E along said
         West 1/8 line of said section 660 feet to the North 1/8 line of said
         section; thence N 86 degrees 36' 57" E along said North 1/8 line of
         said section 660.91 feet; thence N 00 degrees22' 20" W, 660 feet;
         thence S 86 degrees 36' 57" W, 660.91 feet to the place of beginning.

                                  WAYNE COUNTY

         Certain land in Livonia City, Wayne County, Michigan described as:

                  Commencing at the Southeast corner of Section 6, T1S, R9E;
         thence North along the East line of Section 6 a distance of 253 feet to
         the point of beginning; thence continuing North along the East line of
         Section 6 a distance of 50 feet; thence Westerly parallel to the South
         line of Section 6, a distance of 215 feet; thence Southerly parallel to
         the East line of Section 6 a distance of 50 feet;

                                      -32-

<PAGE>

         thence easterly parallel with the South line of Section 6 a distance of
         215 feet to the point of beginning.

                                 WEXFORD COUNTY

         Certain land in Selma Township, Wexford County, Michigan described as:

                  A parcel of land in the NW 1/4 of Section 7, T22N, R10W,
         described as beginning on the North line of said section at a point 200
         feet East of the West line of said section, running thence East along
         said North section line 450 feet, thence South parallel with said West
         section line 350 feet, thence West parallel with said North section
         line 450 feet, thence North parallel with said West section line 350
         feet to the place of beginning.

         SECTION 12. The Company is a transmitting  utility under Section
9401(5) of the Michigan Uniform Commercial Code (M.C.L. 440.9401(5)) as
defined in M.C.L. 440.9105(n).

         IN WITNESS WHEREOF, said Consumers Energy Company has caused this
Supplemental Indenture to be executed in its corporate name by its Chairman of
the Board, President, a Vice President or its Treasurer and its corporate seal
to be hereunto affixed and to be attested by its Secretary or an Assistant
Secretary, and said JPMorgan Chase Bank, as Trustee as aforesaid, to evidence
its acceptance hereof, has caused this Supplemental Indenture to be executed in
its corporate name by a Vice President and its corporate seal to be hereunto
affixed and to be attested by a Trust Officer, in several counterparts, all as
of the day and year first above written.

                                      -33-

<PAGE>

                                             CONSUMERS ENERGY COMPANY

(SEAL)                                    By /s/ LAURA L. MOUNTCASTLE
                                             ----------------------------
                                             Laura L. Mountcastle
Attest:                                      Vice President and Treasurer

/s/ DON A. FORSBLOM
----------------------
Don A. Forsblom
Assistant Secretary

Signed, sealed and delivered
by CONSUMERS ENERGY COMPANY
in the presence of

/s/ KIMBERLY C. WILSON
----------------------
Kimberly C. Wilson

Sammie B. Dalton

STATE OF MICHIGAN             )

                               ss.

COUNTY OF JACKSON             )

                  The foregoing instrument was acknowledged before me this 26th
day of September, 2002, by Laura L. Mountcastle, Vice President and Treasurer of
CONSUMERS ENERGY COMPANY, a Michigan corporation, on behalf of the corporation.

                                       /s/ MARGARET HILLMAN
                                       -------------------------------------
                                       Margaret Hillman, Notary Public
[Seal]                                 Jackson County, Michigan
                                       My Commission Expires:  June 14, 2004

                                       S-1

<PAGE>
                                  JPMORGAN CHASE BANK, AS TRUSTEE

                                       /s/ L. O'BRIEN
                                  By ---------------------
                                          L. O'BRIEN
                                        Vice President

(SEAL)

Attest:

/s/ Nicholas Sberlati
------------------------
Nicholas Sberlati
Trust Officer

Signed, sealed and delivered
by JPMORGAN CHASE BANK
in the presence of

/s/ Natalia Rodriguez
------------------------
Natalia Rodriguez
Assistant Vice President

William G. Keenan
------------------------
William G. Keenan
Assistant Vice President

STATE OF NEW YORK            )
                              ss.
COUNTY OF NEW YORK           )

          The foregoing instrument was acknowledged before me this 26th day of
September, 2002, by L. O'BRIEN, a Vice President of JPMORGAN CHASE BANK,
A New York corporation, on behalf of the corporation.

                                           /s/ Emily Fayan
                                          ----------------------------------
                                                                Notary Public
                                          New York County, New York
                                          My Commission Expires:

                                                        Emily Fayan
                                             Notary Public, State of New York
                                                      No. 24-473706
                                                Qualified in Kings County
                                           Certificate Filed in New York County
                                           Commission Expires December 31, 2005

[Seal]

                                   Prepared by:
                                   Kimberly C. Wilson
                                   212 West Michigan Avenue
                                   Jackson, MI 49201

S-2

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