Document:

Exhibit 10.1

                                 COMPUMED, INC.

                 AMENDED AND RESTATED 2003 STOCK INCENTIVE PLAN

SECTION  1.    PURPOSE

        The purpose of the CompuMed, Inc. 2003 Stock Incentive Plan (the "Plan")
is  to  enhance  the  long-term  stockholder value of CompuMed, Inc., a Delaware
corporation  (the  "Company"),  by offering opportunities to selected persons to
participate in the Company's growth and success, and to encourage them to remain
in the service of the Company or a Related Company (as defined in Section 2) and
to  acquire  and  maintain  stock  ownership  in  the  Company.

SECTION  2.    DEFINITIONS

        In  the  Plan:

        "Award"  means  any  Option  or  Stock  Award.

        "Board"  means  the  Board  of  Directors  of  the  Company.

        "Cause," unless otherwise defined in the instrument evidencing the Award
or  in  a  written  employment  or  services  agreement between the Company or a
Related  Company  and  the  Participant,  means  dishonesty,  fraud, misconduct,
unauthorized  use or disclosure of confidential information or trade secrets, or
conviction or confession of a crime punishable by law (except minor violations),
in  each  case  as  determined  by the Plan Administrator, and its determination
shall  be  conclusive  and  binding.

        "Code"  means the Internal Revenue Code of 1986, as amended from time to
time.

        "Common Stock" means the common stock, par value $0.01 per share, of the
Company.

        "Company  Transaction,"  unless  otherwise  defined  in  the  instrument
evidencing  the  Award  or in a written employment or services agreement between
the  Participant  and  the  Company  or a Related Company, means consummation of
either

        (a)   a  merger  or  consolidation of the Company with or into any other
company,  entity  or  person  or

        (b)   a  sale, lease, exchange or other transfer in one transaction or a
series  of  related  transactions  undertaken  with  a  common purpose of all or
substantially  all  the  Company's  then  outstanding  securities  or  all  or
substantially  all  the  Company's  assets;  provided,  however,  that a Company
Transaction  shall  not  include  a  Related  Party  Transaction.

        "Disability,"  unless  otherwise defined by the Plan Administrator or in
the  instrument  evidencing  the  Award  or  in a written employment or services
agreement  between the Participant and the Company or a Related Company, means a
mental  or  physical impairment of the Participant that is expected to result in
death  or  that  has lasted or is expected to last for a continuous period of 12
months  or  more and that causes the Participant to be unable, in the opinion of
the  Plan  Administrator,  to  perform  his  or  her duties for the Company or a
Related  Company  and  to  be  engaged  in  any  substantial  gainful  activity.

        "Early  Retirement"  means Termination of Service prior to Retirement on
terms  and  conditions  approved  by  the  Plan  Administrator.

        "Exchange  Act"  means  the Securities Exchange Act of 1934, as amended.

        "Fair  Market  Value"  means  the per share value of the Common Stock as
established  in  good faith by the Plan Administrator or, if the Common Stock is
(a) listed on the Nasdaq National Market, the closing sales price for the Common
Stock  as  reported  by  that  market  for  regular session trading for a single
trading  day, or (b) listed on the New York Stock Exchange or the American Stock
Exchange,  the  closing  sales  price  for  the  Common  Stock  as such price is
officially  quoted  in  the  composite tape of transactions on such exchange for
regular  session  trading  for  a  single  trading day, (c) quoted on the Nasdaq
SmallCap  Market,  the  last sales price as reported by that market for a single
trading  day  or (d) quoted on the OTC Bulletin Board Service or by the National
Quotation  Bureau,  Inc.,  the  closing bid price reported by such service for a
single  trading day. If there is no such reported price for the Common Stock for
the  date in question, then such price on the last preceding date for which such
price  exists  shall  be  determinative  of  Fair  Market  Value.

        "Grant  Date"  means  the date on which the Plan Administrator completes
the  corporate  action  authorizing  the  grant  of  an Award or such later date
specified  by  the  Plan  Administrator  provided  that  conditions  to  the
exercisability  or  vesting  of  Awards  shall  not  defer  the  Grant  Date.

        "Incentive Stock Option" means an Option granted with the intention that
it qualify as an "incentive stock option" as that term is defined in Section 422
of  the  Code.

        "Nonqualified  Stock  Option"  means  an  Option other than an Incentive
Stock  Option.

        "Option"  means the right to purchase Common Stock granted under Section
7.

        "Option  Expiration  Date"  has  the  meaning  set forth in Section 7.6.

        "Option  Term"  has  the  meaning  set  forth  in  Section  7.3.

        "Participant"  means  the  person  to  whom  an  Award  is  granted.

        "Plan  Administrator"  has  the  meaning  set  forth  in  Section  3.1.

        "Related  Company"  means any entity that, directly or indirectly, is in
control  of,  or  is  controlled  by  the  Company.

        "Related  Party  Transaction" means (a) a merger or consolidation of the
Company in which the holders of the outstanding voting securities of the Company
immediately prior to the merger or consolidation hold at least a majority of the
outstanding  voting  securities  of  the Successor Company immediately after the
merger  or  consolidation;  (b) a sale, lease, exchange or other transfer of the
Company's  assets  to  a  majority-owned  subsidiary  company; (c) a transaction
undertaken  for  the  principal  purpose  of  restructuring  the  capital of the
Company,  including  reincorporating  the Company in a different jurisdiction or
creating  a  holding  company;  or  (d)  a corporate dissolution or liquidation.

        "Retirement,"  unless  otherwise  defined by the Plan Administrator from
time  to time for purposes of the Plan, means Termination of Service on or after
the  date the individual reaches "normal retirement age" as that term is defined
in  Section  411(a)(8)  of  the  Code.

        "Securities  Act"  means  the  Securities  Act  of  1933,  as  amended.

        "Stock  Award"  means  an  Award  of  shares  of  Common  Stock or units
denominated  in Common Stock granted under Section 9, the rights of ownership of
which  may  be  subject  to  restrictions  prescribed by the Plan Administrator.

        "Successor  Company"  means the surviving company, the successor company
or  its  parent,  as  applicable,  in  connection  with  a  Company Transaction.

        "Ten  Percent Stockholder" means a Participant who owns more than 10% of
the total combined voting power of all classes of the stock of the Company or of
its  parent  or  subsidiary  corporations.

        "Termination  of  Service"  means a termination of employment or service
relationship  with  the  Company  or  a  Related Company for any reason, whether
voluntary  or  involuntary,  including  death,  Disability,  Early Retirement or
Retirement,  as determined by the Plan Administrator in its sole discretion. Any
question  as to whether and when there has been a Termination of Service for the
purposes  of  an  Award  and  the  cause of such Termination of Service shall be
determined  by  the  Plan  Administrator  and  its determination shall be final.
Transfer of the Participant's employment or service relationship between Related
Companies,  or  between  the  Company  and  any  Related  Company,  shall not be
considered  a  Termination  of  Service for purposes of an Award, but unless the
Plan  Administrator  determines  otherwise,  a  Termination  of Service shall be
deemed  to occur if the Participant's employment or service relationship is with
an  entity  that  has  ceased  to  be  a  Related  Company.

        "Vesting  Commencement  Date"  means  the  Grant Date or such other date
selected  by  the Plan Administrator as the date from which the Option begins to
vest  for  purposes  of  Section  7.4.

SECTION  3.    ADMINISTRATION

3.1    Plan  Administrator

        The  Plan  shall  be  administered  by  the  Board and/or a committee or
committees  (which  term includes subcommittees) appointed by, and consisting of
two  or  more  members of, the Board (a "Plan Administrator"). If and so long as
the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act,
the  Board  shall  consider  in selecting the members of any committee acting as
Plan  Administrator,  with  respect  to  any persons subject or likely to become
subject to Section 16 of the Exchange Act, the provisions regarding (a) "outside
directors"  as  contemplated  by Section 162(m) of the Code and (b) "nonemployee
directors" as contemplated by Rule 16b-3 under the Exchange Act. Notwithstanding
the  foregoing,  the Board may delegate the responsibility for administering the
Plan  with  respect  to  designated  classes  of  eligible  persons to different
committees  consisting  of  one  or  more  members of the Board, subject to such
limitations  as  the  Board deems appropriate. Committee members shall serve for
such  term  as  the  Board may determine, subject to removal by the Board at any
time.  To the extent consistent with applicable law, the Board may authorize one
or  more  officers  of  the  Company  to  grant  Awards to designated classes of
eligible  persons,  within  the  limits  specifically  prescribed  by the Board.

3.2    Administration  and  Interpretation  by  Plan  Administrator

        Except  for  the  terms and conditions explicitly set forth in the Plan,
the  Plan  Administrator  shall  have exclusive authority, in its discretion, to
determine all matters relating to Awards under the Plan, including selecting the
persons  to  be  granted  Awards,  determining the type of Awards, the number of
shares  of  Common  Stock  subject  to  an  Award,  and  all  terms, conditions,
restrictions  and  limitations,  if any, of an Award, and approving the forms of
agreement  for  use  under  the  Plan.  The  Plan  Administrator shall also have
exclusive  authority  to  interpret  the  Plan  and  the terms of any instrument
evidencing  the  Award  and  may  from  time  to time adopt and change rules and
regulations  of  general  application  for  the  Plan's administration. The Plan
Administrator's  interpretation  of  the Plan and its rules and regulations, and
all  actions taken and determinations made by the Plan Administrator pursuant to
the  Plan,  shall be conclusive and binding on all parties involved or affected.
The  Plan Administrator may delegate ministerial duties to such of the Company's
officers as it so determines. For purposes of determining the effect on an Award
of a Company-approved leave of absence or a Participant's working less than full
time,  the  human  resources  director  or  other  person

SECTION  4.    STOCK  SUBJECT  TO  THE  PLAN

4.1    Authorized  Number  of  Shares

        Subject to adjustment from time to time as provided in Section 12.1, the
number  of shares of Common Stock available for issuance under the Plan shall be
4,600,000  shares.

        In  addition,  (a)  any  authorized  shares  not  issued  or  subject to
outstanding awards under the Company's 2002 Stock Option Plan (the "Prior Plan")
on  the date of adoption of the Plan by the Company's Board of Directors and (b)
any  shares subject to outstanding awards under the Prior Plan on such date that
cease  to  be  subject  to  such  awards  (other  than  by reason of exercise or
settlement  of  the  awards  to  the extent they are exercised for or settled in
shares),  up  to an aggregate maximum of 1,900,000 shares, subject to adjustment
from  time to time as provided in Section 12.1, shall cease, as of such date, to
be available for grant and issuance under the Prior Plan, but shall be available
for  issuance  under  the  Plan.

        The  number  of shares of Common Stock reserved pursuant to this Section
4.1  shall  be  increased  by the corresponding number of shares of Common Stock
that may be issued pursuant to Awards granted in substitution for, or the number
of  shares of Common Stock issuable pursuant to any old awards that are assumed,
in  an  Acquisition  Transaction  as  set  forth  in  Section  6.3.

        Shares issued under the Plan shall be drawn from authorized and unissued
shares  or  shares  now held or subsequently acquired by the Company as treasury
shares.

4.2    Reuse  of  Shares

        Any  shares of Common Stock that have been made subject to an Award that
cease to be subject to the Award (other than by reason of exercise or settlement
of the Award to the extent it is exercised for or settled in shares) shall again
be  available  for issuance in connection with future grants of Awards under the
Plan.  In  the  event shares issued under the Plan are reacquired by the Company
pursuant  to  any  forfeiture  provision,  right of repurchase or right of first
refusal,  such  shares  shall  again  be available for the purposes of the Plan;
provided, that the maximum number of shares that may be issued upon the exercise
of  Incentive  Stock Options shall equal the sum of the share numbers in Section
4.1,  subject  to  adjustment from time to time as provided in Section 12.1; and
provided,  further,  that  for purposes of Section 4.3, any such shares shall be
counted  in  accordance  with  the  requirements  of Section 162(m) of the Code.
SECTION  5.    ELIGIBILITY

        An  Award  may  be  granted  to any officer, director or employee of the
Company  or  a  Related  Company  that  the Plan Administrator from time to time
selects.  An Award may also be granted to any consultant, advisor or independent
contractor  who provides services to the Company or any Related Company, so long
as  such  Participant  (a) renders bona fide services that are not in connection
with  the  offer  and  sale  of  the  Company's  securities in a capital-raising
transaction and (b) does not directly or indirectly promote or maintain a market
for  the  Company's  securities.

SECTION  6.    AWARDS

6.1    Form  and  Grant  of  Awards

        The Plan Administrator shall have the authority, in its sole discretion,
to  determine  the  type or types of Awards to be granted under the Plan. Awards
may  be  granted  singly  or  in  combination.

6.2    Settlement  of  Awards

        The  Company  may settle Awards through the delivery of shares of Common
Stock, the granting of replacement Awards or any combination thereof as the Plan
Administrator  shall  determine.  Any  Award  settlement  may be subject to such
conditions,  restrictions  and  contingencies  as  the  Plan Administrator shall
determine.  The  Plan  Administrator  may  permit or require the deferral of any
Award  payment,  subject to such rules and procedures as it may establish, which
may  include  provisions  for  the payment or crediting of interest, or dividend
equivalents,  including converting such credits into deferred stock equivalents.

6.3    Acquired  Company  Awards

        Notwithstanding  anything  in  the  Plan  to  the  contrary,  the  Plan
Administrator  may grant Awards under the Plan in substitution for awards issued
under  other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of acquired entities ("Acquired Entities") (or
the  parent  of an Acquired Entity) and the new Award is substituted, or the old
award  is assumed, by reason of a merger, consolidation, acquisition of property
or  stock, reorganization or liquidation (the "Acquisition Transaction"). In the
event  that a written agreement pursuant to which the Acquisition Transaction is
completed  is  approved by the Board and said agreement sets forth the terms and
conditions  of  the  substitution for or assumption of outstanding awards of the
Acquired  Entity,  said terms and conditions shall be deemed to be the action of
the  Plan  Administrator  without  any further action by the Plan Administrator,
except as may be required for compliance with Rule 16b-3 under the Exchange Act,
and  the  persons  holding  such  awards  shall  be  deemed  to be Participants.

SECTION  7.    AWARDS  OF  OPTIONS

7.1    Grant  of  Options

        The Plan Administrator shall have the authority, in its sole discretion,
to  grant Options designated as Incentive Stock Options or as Nonqualified Stock
Options.

7.2    Option  Exercise  Price

        The  exercise  price  for  shares  purchased under an Option shall be as
determined  by  the  Plan  Administrator, but shall not be less than the minimum
exercise  price  required by Section 8.3 with respect to Incentive Stock Options
and  shall  not be less than 85% of Fair Market Value of the Common Stock on the
Grant  Date  with  respect  to  Nonqualified  Stock  Options.

7.3    Term  of  Options

        Subject  to earlier termination in accordance with the terms of the Plan
and  the  instrument  evidencing  the Option, the maximum term of an Option (the
"Option Term") shall be as established for that Option by the Plan Administrator
or, if not so established, shall be ten years from the Grant Date. For Incentive
Stock  Options,  the  Option  Term  shall  be  as  specified  in  Section  8.4.

7.4    Exercise  of  Options

        The  Plan Administrator shall establish and set forth in each instrument
that  evidences  an  Option the time at which, or the installments in which, the
Option  shall vest and become exercisable, any of which provisions may be waived
or  modified by the Plan Administrator at any time. If not so established in the
instrument  evidencing  the Option, the Option shall vest and become exercisable
according to the following schedule, which may be waived or modified by the Plan
Administrator  at  any  time:

--------------------------------------------------------------------------------
Period of Participant's Continuous Employment or Service With the Company or Its
Related  Companies  From the Vesting Commencement Date;  Portion of Total Option
That  Is  Vested  and  Exercisable
--------------------------------------------------------------------------------

After  1  Year;  1/3

Each additional one-month period of continuous service completed thereafter;  An
additional  1/36th

After  3  years;  100%

        The  Plan  Administrator, in its sole discretion, may adjust the vesting
schedule  of  an Option held by a Participant who works less than "full time" as
that  term  is defined by the Plan Administrator or who takes a Company-approved
leave  of  absence.

        To  the  extent  an Option has vested and become exercisable, the Option
may  be  exercised  in  whole  or  from  time to time in part by delivery to the
Company of a written stock option exercise agreement or notice, in a form and in
accordance  with procedures established by the Plan Administrator, setting forth
the  number  of  shares with respect to which the Option is being exercised, the
restrictions  imposed  on the shares purchased under such exercise agreement, if
any,  and  such  representations  and  agreements as may be required by the Plan
Administrator,  accompanied  by  payment in full as described in Section 7.5. An
Option  may be exercised only for whole shares and may not be exercised for less
than  a  reasonable  number of shares at any one time, as determined by the Plan
Administrator.

7.5    Payment  of  Exercise  Price

        The exercise price for shares purchased under an Option shall be paid in
full  to  the  Company  by delivery of consideration equal to the product of the
Option  exercise  price  and  the number of shares purchased. Such consideration
must  be  paid before the Company will issue the shares being purchased and must
be  in a form or a combination of forms acceptable to the Plan Administrator for
that  purchase,  which  forms  may  include:

        (a)   cash;

        (b)   check;

        (c)   tendering  (either  actually or, if the Common Stock is registered
under  Section  12(b)  or  12(g)  of the Exchange Act, by attestation) shares of
Common  Stock  already  owned by the Participant for at least six months (or any
shorter  period  necessary  to  avoid  a  charge  to  the Company's earnings for
financial  reporting purposes) that on the day prior to the exercise date have a
Fair  Market  Value  equal  to  the aggregate exercise price of the shares being
purchased  under  the  Option;

        (d)   if  the Common Stock is registered under Section 12(b) or 12(g) of
the Exchange Act, delivery of a properly executed exercise notice, together with
irrevocable  instructions  to  a  brokerage  firm  designated  by the Company to
deliver promptly to the Company the aggregate amount of sale or loan proceeds to
pay the Option exercise price and any withholding tax obligations that may arise
in  connection  with the exercise, all in accordance with the regulations of the
Federal  Reserve  Board;  or

        (e)   such  other  consideration  as  the Plan Administrator may permit.

7.6    Post-Termination  Exercises

        The  Plan Administrator shall establish and set forth in each instrument
that  evidences  an  Option whether the Option shall continue to be exercisable,
and  the  terms  and  conditions of such exercise, if a Participant ceases to be
employed  by, or to provide services to, the Company or a Related Company, which
provisions  may  be waived or modified by the Plan Administrator at any time. If
not  so established in the instrument evidencing the Option, the Option shall be
exercisable according to the following terms and conditions, which may be waived
or  modified  by  the  Plan  Administrator  at  any  time:

        (a)   Any portion of an Option that is not vested and exercisable on the
date  of  a  Participant's  Termination  of  Service  shall expire on such date.

        (b)   Any  portion  of  an  Option that is vested and exercisable on the
date  of  a Participant's Termination of Service shall expire on the earliest to
occur  of

        (i)    if  the  Participant's  Termination of Service occurs for reasons
other  than Cause, Retirement or Early Retirement, Disability or death, the date
that  is  three  months  after  such  Termination  of  Service;

        (ii)   if  the  Participant's Termination of Service occurs by reason of
Retirement or Early Retirement, Disability or death, the one-year anniversary of
such  Termination  of  Service;  and

        (iii)  the  last  day of the Option Term (the "Option Expiration Date").

        If  a Participant's Termination of Service occurs for Cause, all Options
granted to the Participant shall automatically expire upon first notification to
the  Participant  of  such termination, unless the Plan Administrator determines
otherwise.  If  a  Participant's  employment  or  service  relationship with the
Company  is  suspended pending an investigation of whether the Participant shall
be  terminated  for  Cause,  all the Participant's rights under any Option shall
likewise  be  suspended  during  the  period of investigation. If any facts that
would  constitute  termination  for  Cause  are discovered after a Participant's
Termination  of  Service,  any  Option  then  held  by  the  Participant  may be
immediately  terminated  by  the  Plan  Administrator,  in  its sole discretion.

        Notwithstanding  the  foregoing,  if a Participant dies after his or her
Termination of Service but while an Option is otherwise exercisable, the portion
of  the Option that is vested and exercisable on the date of such Termination of
Service shall expire upon the earlier to occur of (y) the Option Expiration Date
and  (z)  the  one-year  anniversary  of  the  date  of  death,  unless the Plan
Administrator  determines  otherwise.

        (c)   A Participant's change in status from an employee to a consultant,
advisor  or  independent  contractor  or  a  change in status from a consultant,
advisor  or  independent  contractor  to  an employee, shall not be considered a
Termination  of  Service  for  purposes  of  this  Section  7.

        (d)   The  effect  of  a  Company-approved  leave  of  absence  on  the
application  of this Section 7 shall be determined by the Plan Administrator, in
its  sole  discretion.

SECTION  8.    INCENTIVE  STOCK  OPTION  LIMITATIONS

        Notwithstanding  any  other  provisions  of  the Plan, and to the extent
required by Section 422 of the Code, Incentive Stock Options shall be subject to
the  following  additional  terms  and  conditions:

8.1    Dollar  Limitation

        To  the  extent  the  aggregate  Fair Market Value (determined as of the
Grant  Date)  of  Common  Stock  with respect to which a Participant's Incentive
Stock  Options  become  exercisable  for the first time during any calendar year
(under  the  Plan and all other stock option plans of the Company and its parent
and  subsidiary  corporations)  exceeds  $100,000,  such  portion  in  excess of
$100,000  shall  be  treated  as  a  Nonqualified Stock Option. In the event the
Participant holds two or more such Options that become exercisable for the first
time in the same calendar year, such limitation shall be applied on the basis of
the  order  in  which  such  Options  are  granted.

8.2    Eligible  Employees

        Individuals who are not employees of the Company or one of its parent or
subsidiary  corporations  may  not  be  granted  Incentive  Stock  Options.

8.3    Exercise  Price

        The  exercise  price of an Incentive Stock Option shall be at least 100%
of  the Fair Market Value of the Common Stock on the Grant Date, and in the case
of  an Incentive Stock Option granted to a Ten Percent Stockholder, shall not be
less  than  110% of the Fair Market Value of the Common Stock on the Grant Date.
The  determination  of  more than 10% ownership shall be made in accordance with
Section  422  of  the  Code.

8.4    Option  Term

        Subject  to earlier termination in accordance with the terms of the Plan
and  the instrument evidencing the Option, the Option Term of an Incentive Stock
Option  shall not exceed ten years, and in the case of an Incentive Stock Option
granted  to  a  Ten  Percent  Stockholder,  shall  not  exceed  five  years.

8.5    Exercisability

        An Option designated as an Incentive Stock Option shall cease to qualify
for  favorable  tax  treatment  as an Incentive Stock Option to the extent it is
exercised  (if  permitted by the terms of the Option) (a) more than three months
after  the date of a Participant's Termination of Service if termination was for
reasons other than death or Disability, (b) more than one year after the date of
a  Participant's  Termination  of  Service  if  termination  was  by  reason  of
Disability,  or  (c) after the Participant has been on leave of absence for more
than  90  days,  unless  the Participant's reemployment rights are guaranteed by
statute  or  contract.

8.6    Taxation  of  Incentive  Stock  Options

        In  order  to  obtain  certain  tax benefits afforded to Incentive Stock
Options  under  Section  422  of  the Code, the Participant must hold the shares
acquired  upon the exercise of an Incentive Stock Option for two years after the
Grant  Date  and  one  year  after  the  date  of  exercise.

        A  Participant may be subject to the alternative minimum tax at the time
of exercise of an Incentive Stock Option. The Participant shall give the Company
prompt  notice  of  any  disposition  of  shares  acquired on the exercise of an
Incentive  Stock  Option  prior  to  the  expiration  of  such  holding periods.

8.7    Promissory  Notes

        The  amount  of any promissory note delivered pursuant to Section 7.5 in
connection  with  an  Incentive  Stock  Option  shall  bear  interest  at a rate
specified  by the Plan Administrator, but in no case less than the rate required
to  avoid  imputation  of  interest  (taking  into account any exceptions to the
imputed  interest  rules)  for  federal  income  tax  purposes.

8.8    Code  Definitions

        For the purposes of this Section 8, "parent corporation" and "subsidiary
corporation"  shall  have the meanings attributed to those terms for purposes of
Section  422  of  the  Code.

SECTION  9.    STOCK  AWARDS

9.1    Grant  of  Stock  Awards

        The  Plan  Administrator is authorized to make Awards of Common Stock or
Awards  denominated  in  units  of Common Stock on such terms and conditions and
subject  to  such  repurchase  or  forfeiture restrictions, if any (which may be
based  on  continuous service with the Company or the achievement of performance
goals  related  to  one  or  more  of  the  following:  profits,  profit growth,
profit-related return ratios, cash flow or total stockholder return net revenue,
net  earnings,  operating  earnings  or  income,  earnings per share, cash flow,
pretax  profits,  earnings growth, revenue growth, book value per share or stock
price,  where  such  goals  may  be  stated  in  absolute  terms  or relative to
comparison  companies),  as  the Plan Administrator shall determine, in its sole
discretion,  which  terms, conditions and restrictions shall be set forth in the
instrument evidencing the Award. The terms, conditions and restrictions that the
Plan Administrator shall have the power to determine shall include the manner in
which  shares  subject  to  Stock  Awards  are  held during the periods they are
subject  to  restrictions  and  the  circumstances  under  which  repurchase  or
forfeiture  of  the  Stock  Award  shall  occur  by  reason  of  a Participant's
Termination  of  Service.

9.2    Issuance  of  Shares

        Upon  the  satisfaction  of  any  terms,  conditions  and  restrictions
prescribed in respect to a Stock Award, or upon a Participant's release from any
terms,  conditions  and restrictions of a Stock Award, as determined by the Plan
Administrator,  the  Company  shall  release,  as  soon  as  practicable, to the
Participant  or,  in  the  case  of  the  Participant's  death,  to the personal
representative  of the Participant's estate or as the appropriate court directs,
the  appropriate  number  of  shares  of  Common  Stock.

9.3    Waiver  of  Restrictions

        Notwithstanding any other provisions of the Plan, the Plan Administrator
may,  in  its sole discretion, waive the repurchase or forfeiture period and any
other  terms,  conditions  or  restrictions  on  any  Stock  Award  under  such
circumstances and subject to such terms and conditions as the Plan Administrator
shall  deem  appropriate; provided, however, that the Plan Administrator may not
adjust performance goals for any Stock Award intended to be exempt under Section
162(m)  of  the  Code for the year in which the Stock Award is settled in such a
manner  as  would  increase  the  amount  of compensation otherwise payable to a
Participant.

SECTION  10.    WITHHOLDING

        The Company may require the Participant to pay to the Company the amount
of any taxes that the Company is required by applicable federal, state, local or
foreign  law  to  withhold  with respect to the grant, vesting or exercise of an
Award.  The  Company  shall  not be required to issue any shares of Common Stock
under  the  Plan  until  such  obligations  are  satisfied.

        The  Plan  Administrator  may permit or require a Participant to satisfy
all  or part of his or her tax withholding obligations by (a) paying cash to the
Company,  (b) having the Company withhold from any cash amounts otherwise due or
to  become  due  from  the Company to the Participant, or (c) having the Company
withhold  a  number  of shares of Common Stock that would otherwise be issued to
the  Participant  (or  become vested in the case of Stock Awards) having a value
equal to the tax withholding obligations, or (d) surrendering a number of shares
of  Common  Stock  the  Participant already owns having a value equal to the tax
withholding  obligations. The value of the shares so withheld may not exceed the
employer's minimum required tax withholding rate, and the value of the shares so
tendered  may  not  exceed such rate to the extent the Participant has owned the
tendered  shares  for  less  than  six months if such limitation is necessary to
avoid  a  charge  to  the  Company  for  financial  reporting  purposes.

SECTION  11.    ASSIGNABILITY

        No Award or interest in an Award may be assigned, pledged or transferred
by  the  Participant  or  made  subject  to  attachment  or  similar proceedings
otherwise  than  by  will or by the applicable laws of descent and distribution,
except  to  the  extent  a  Participant  designates  a  beneficiary  on  a
Company-approved  form  who  may exercise the Award or receive payment under the
Award  after  the Participant's death. During a Participant's lifetime, an Award
may  be  exercised only by the Participant. Notwithstanding the foregoing and to
the  extent permitted by Section 422 of the Code, the Plan Administrator, in its
sole  discretion,  may  permit  a  Participant  to  assign or transfer an Award;
provided,  however, that an Award so assigned or transferred shall be subject to
all  the  terms and conditions of the Plan and those contained in the instrument
evidencing  the  Award.

SECTION  12.    ADJUSTMENTS

12.1    Adjustment  of  Shares

        In  the event, at any time or from time to time, a stock dividend, stock
split,  spin-off,  combination  or exchange of shares, recapitalization, merger,
consolidation,  distribution  to stockholders other than a normal cash dividend,
or  other  change in the Company's corporate or capital structure results in (a)
the  outstanding shares of Common Stock, or any securities exchanged therefor or
received  in  their  place,  being  exchanged  for a different number or kind of
securities  of  the  Company  or  of  any other company or (b) new, different or
additional  securities  of the Company or of any other company being received by
the  holders  of  shares  of  Common  Stock  of  the  Company,  then  the  Plan
Administrator  shall make proportional adjustments in (i) the maximum number and
kind  of  securities subject to the Plan and issuable as Incentive Stock Options
as set forth in Section 4, the maximum number and kind of securities that may be
made  subject  to  Stock  Awards and to Awards to any individual as set forth in
Section  4.3,  and  the  number  and  kind  of  securities automatically granted
pursuant  to  a  formula  program under the Plan and (ii) the number and kind of
securities  that are subject to any outstanding Award and the per share price of
such  securities, without any change in the aggregate price to be paid therefor.
The  determination  by  the  Plan  Administrator  as  to the terms of any of the
foregoing  adjustments  shall  be  conclusive  and  binding. Notwithstanding the
foregoing,  a dissolution or liquidation of the Company or a Company Transaction
shall  not  be  governed  by this Section 12.1 but shall be governed by Sections
12.2  and  12.3,  respectively.

12.2    Dissolution  or  Liquidation

        To  the extent not previously exercised or settled, and unless otherwise
determined  by  the Plan Administrator in its sole discretion, Options and Stock
Awards denominated in units shall terminate immediately prior to the dissolution
or  liquidation  of  the  Company.  To  the  extent  a  forfeiture  provision or
repurchase  right  applicable  to  an  Award  has  not  been  waived by the Plan
Administrator,  the  Award  shall  be  forfeited  immediately  prior  to  the
consummation  of  the  dissolution  or  liquidation.

12.3    Company  Transaction

        12.3.1    Options

        In  the  event of a Company Transaction, except as otherwise provided in
the  instrument  evidencing  an  Option  or  in a written employment or services
agreement  between  a  Participant  and  the  Company  or  a  Related  Company,

        (a)   Except  as  provided  in  subsection  (b)  below, each outstanding
Option  shall  be  assumed  or  an equivalent option or right substituted by the
Successor  Company.

        (b)   If  in connection with a Company Transaction the Successor Company
refuses to assume or substitute for an Option, then each such outstanding Option
shall  become  fully vested and exercisable with respect to 100% of the unvested
portion  of  the  Option.  In such case, the Plan Administrator shall notify the
Participant in writing or electronically that the unvested portion of the Option
specified  above  shall  be  fully  vested  and exercisable for a specified time
period.  At  the  expiration  of  the  time  period, the Option shall terminate,
provided  that  the  Company  Transaction  has  occurred.

        (c)   For  the  purposes  of  this  Section  12.3,  the  Option shall be
considered  assumed  or substituted for if following the Company Transaction the
option  or  right  confers  the  right to purchase or receive, for each share of
Common Stock subject to the Option immediately prior to the Company Transaction,
the  consideration  (whether  stock,  cash,  or  other  securities  or property)
received  in  the  Company Transaction by holders of Common Stock for each share
held  on  the  effective  date of the transaction (and if holders were offered a
choice  of  consideration,  the type of consideration chosen by the holders of a
majority  of  the  outstanding  shares);  provided,  however,  that  if  such
consideration  received in the Company Transaction is not solely common stock of
the  Successor  Company,  the  Plan  Administrator  may, with the consent of the
Successor  Company,  provide  for  the  consideration  to  be  received upon the
exercise  of  the  Option, for each share of Common Stock subject thereto, to be
solely  common stock of the Successor Company substantially equal in fair market
value  to the per share consideration received by holders of Common Stock in the
Company  Transaction. The determination of such substantial equality of value of
consideration  shall  be  made  by  the Plan Administrator and its determination
shall  be  conclusive  and  binding.

        (d)   Notwithstanding  the foregoing or any other provision of the Plan,
the  Plan  Administrator  may  determine  at  any time that Participants holding
Options  shall have the right in lieu of exercising the Option to elect during a
specified  period  of time determined by the Plan Administrator to surrender all
or  part of an Option to the Company in exchange for a cash payment in an amount
equal  to the amount by which the Fair Market Value per share of Common Stock as
of  the  date  the  Corporate  Transaction occurs exceeds the per share exercise
price for such Option multiplied by the number of shares subject to such Option.

        (e)   All  Options  shall  terminate  and  cease  to  remain outstanding
immediately  following  the Company Transaction, except to the extent assumed by
the  Successor  Company.

        12.3.2    Stock  Awards

        In  the  event of a Company Transaction, except as otherwise provided in
the  instrument  evidencing the Award and unless otherwise provided in a written
employment  or  services  agreement  between  a Participant and the Company or a
Related Company, the vesting of shares subject to Stock Awards shall accelerate,
and  the  forfeiture provisions to which such shares are subject shall lapse, if
and  to  the  same extent that the vesting of outstanding Options accelerates in
connection  with  the Company Transaction. If unvested Options are to be assumed
or  substituted  by a Successor Company without acceleration upon the occurrence
of  a Company Transaction, the repurchase or forfeiture provisions to which such
Stock  Awards are subject shall continue with respect to shares of the Successor
Company  that  may  be  issued  in  exchange  for  such  shares.

12.4    Further  Adjustment  of  Awards

        Subject to Sections 12.2 and 12.3, the Plan Administrator shall have the
discretion,  exercisable  at  any  time  before  a  sale, merger, consolidation,
reorganization, liquidation, dissolution or change of control of the Company, as
defined  by the Plan Administrator, to take such further action as it determines
to  be necessary or advisable with respect to Awards. Such authorized action may
include  (but  shall  not  be  limited to) establishing, amending or waiving the
type,  terms,  conditions  or  duration  of, or restrictions on, Awards so as to
provide  for  earlier,  later, extended or additional time for exercise, lifting
restrictions  and  other modifications, and the Plan Administrator may take such
actions  with respect to all Participants, to certain categories of Participants
or  only to individual Participants. The Plan Administrator may take such action
before  or after granting Awards to which the action relates and before or after
any  public  announcement  with  respect  to  such  sale, merger, consolidation,
reorganization, liquidation, dissolution or change of control that is the reason
for  such  action.

12.5    Limitations

        The  grant  of  Awards  shall  in  no  way affect the Company's right to
adjust,  reclassify,  reorganize  or  otherwise  change  its capital or business
structure  or to merge, consolidate, dissolve, liquidate or sell or transfer all
or  any  part  of  its  business  or  assets.

12.6    Fractional  Shares

        In  the  event  of any adjustment in the number of shares covered by any
Award, each such Award shall cover only the number of full shares resulting from
such  adjustment.

SECTION  13.    AMENDMENT  AND  TERMINATION

13.1    Amendment,  Suspension  or  Termination  of  Plan

        The Board may amend, suspend or terminate the Plan or any portion of the
Plan  at  any  time  and  in such respects as it shall deem advisable; provided,
however, that to the extent required for compliance with Section 422 of the Code
or  any applicable law or regulation, stockholder approval shall be required for
any  amendment  that would (a) increase the total number of shares available for
issuance  under  the Plan, (b) modify the class of employees eligible to receive
Options,  or (c) otherwise require stockholder approval under any applicable law
or  regulation.  Any  amendment  made  to  the  Plan  that  would  constitute  a
"modification"  to  Incentive  Stock  Options  outstanding  on  the date of such
amendment  shall  not,  without the consent of the Participant, be applicable to
such outstanding Incentive Stock Options but shall have prospective effect only.

13.2    Term  of  Plan

        The Plan shall have no fixed expiration date; provided, however, that no
Incentive  Stock  Options  may be granted more than ten years after the later of
(a)  the  adoption by the Board of the Plan and (b) the adoption by the Board of
any  amendment  to  the  Plan  that  constitutes  the adoption of a new plan for
purposes  of  Section  422  of  the  Code.

13.3    Consent  of  Participant

        The  suspension,  amendment  or  termination  of  the  Plan or a portion
thereof  or  the  amendment  of  an  outstanding  Award  shall  not, without the
Participant's  consent,  materially  adversely affect any rights under any Award
theretofore  granted to the Participant under the Plan. Any change or adjustment
to  an  outstanding Incentive Stock Option shall not, without the consent of the
Participant, be made in a manner so as to constitute a "modification" that would
cause such Incentive Stock Option to fail to continue to qualify as an Incentive
Stock  Option.  Notwithstanding  the foregoing, any adjustments made pursuant to
Sections  12.1  through  12.3  shall  not  be  subject  to  these  restrictions.

SECTION  14.    GENERAL

14.1    Evidence  of  Awards

        Awards granted under the Plan shall be evidenced by a written instrument
that  shall  contain such terms, conditions, limitations and restrictions as the
Plan  Administrator  shall deem advisable and that are not inconsistent with the
Plan.

14.2    No  Individual  Rights

        Nothing  in the Plan or any Award granted under the Plan shall be deemed
to  constitute  an  employment  contract or confer or be deemed to confer on any
Participant  any  right  to  continue in the employ of, or to continue any other
relationship  with,  the  Company or any Related Company or limit in any way the
right  of  the  Company  or  any  Related  Company  to terminate a Participant's
employment  or  other  relationship  at  any  time,  with  or  without  Cause.

14.3    Issuance  of  Shares

        Notwithstanding  any other provision of the Plan, the Company shall have
no  obligation  to issue or deliver any shares of Common Stock under the Plan or
make any other distribution of benefits under the Plan unless, in the opinion of
the Company's counsel, such issuance, delivery or distribution would comply with
all  applicable  laws  (including,  without  limitation, the requirements of the
Securities  Act  or  the  laws  of  any  state or foreign jurisdiction), and the
applicable  requirements  of  any  securities  exchange  or  similar  entity.

        The  Company shall be under no obligation to any Participant to register
for  offering or resale or to qualify for exemption under the Securities Act, or
to  register or qualify under the laws of any state or foreign jurisdiction, any
shares of Common Stock, security or interest in a security paid or issued under,
or  created  by,  the  Plan,  or to continue in effect any such registrations or
qualifications  if made. The Company may issue certificates for shares with such
legends  and  subject  to  such  restrictions  on  transfer  and  stop-transfer
instructions  as  counsel  for  the  Company  deems  necessary  or desirable for
compliance  by  the  Company  with  federal,  state and foreign securities laws.

        To  the  extent  the Plan or any instrument evidencing an Award provides
for  issuance  of stock certificates to reflect the issuance of shares of Common
Stock,  the  issuance  may be effected on a noncertificated basis, to the extent
not  prohibited by applicable law or the applicable rules of any stock exchange.

14.4    No  Rights  as  a  Stockholder

        No  Option  or  Stock  Award  denominated  in  units  shall  entitle the
Participant  to any cash dividend, voting or other right of a stockholder unless
and until the date of issuance under the Plan of the shares that are the subject
of  such  Award.

14.5    Compliance  With  Laws  and  Regulations

        Notwithstanding  anything  in  the  Plan  to  the  contrary,  the  Plan
Administrator, in its sole discretion, may bifurcate the Plan so as to restrict,
limit  or condition the use of any provision of the Plan to Participants who are
officers  or  directors  subject  to  Section  16 of the Exchange Act without so
restricting,  limiting  or  conditioning  the  Plan  with  respect  to  other
Participants.  Additionally,  in interpreting and applying the provisions of the
Plan,  any  Option  granted  as  an  Incentive Stock Option pursuant to the Plan
shall,  to  the  extent  permitted  by  law, be construed as an "incentive stock
option"  within  the  meaning  of  Section  422  of  the  Code.

14.6    Participants  in  Other  Countries

        The  Plan  Administrator  shall  have  the  authority  to  adopt  such
modifications,  procedures  and  subplans  as  may  be necessary or desirable to
comply  with  provisions  of the laws of other countries in which the Company or
any  Related  Company  may  operate to assure the viability of the benefits from
Awards  granted  to  Participants  employed  in  such  countries and to meet the
objectives  of  the  Plan.

14.7    No  Trust  or  Fund

        The Plan is intended to constitute an "unfunded" plan. Nothing contained
herein  shall  require the Company to segregate any monies or other property, or
shares of Common Stock, or to create any trusts, or to make any special deposits
for  any  immediate  or  deferred  amounts  payable  to  any Participant, and no
Participant  shall  have  any  rights  that  are greater than those of a general
unsecured  creditor  of  the  Company.

14.8    Severability

        If  any  provision of the Plan or any Award is determined to be invalid,
illegal  or  unenforceable  in  any  jurisdiction, or as to any person, or would
disqualify  the  Plan  or  any Award under any law deemed applicable by the Plan
Administrator, such provision shall be construed or deemed amended to conform to
applicable  laws, or, if it cannot be so construed or deemed amended without, in
the  Plan  Administrator's  determination, materially altering the intent of the
Plan  or  the  Award,  such provision shall be stricken as to such jurisdiction,
person  or  Award, and the remainder of the Plan and any such Award shall remain
in  full  force  and  effect.

14.9    Choice  of  Law

        The  Plan and all determinations made and actions taken pursuant hereto,
to  the extent not otherwise governed by the laws of the United States, shall be
governed  by  the  laws  of  the  State  of  Delaware  without  giving effect to
principles  of  conflicts  of  law.

SECTION  15.    EFFECTIVE  DATE

        The  effective  date  is  the  date  on which the Plan is adopted by the
Board.  If  the  stockholders  of  the Company do not approve the Plan within 12
months  after  the  Board's  adoption  of  the Plan, any Incentive Stock Options
granted  under  the  Plan  will  be  treated  as  Nonqualified  Stock  Options.EX-4.2

ONE HUNDRED SECOND SUPPLEMENTAL INDENTURE

Providing among other things for

FIRST MORTGAGE BONDS,

5.65% Insured Quarterly Notes Due 2035

Dated as of April 13, 2005

CONSUMERS ENERGY COMPANY

TO

JPMORGAN CHASE BANK, N.A.

TRUSTEE

Counterpart _____ of 90

1

THIS ONE HUNDRED SECOND SUPPLEMENTAL INDENTURE, dated as of April 13, 2005 (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 One Energy Plaza, in
Jackson, Jackson County, Michigan 49201, formerly known as Consumers Power Company (hereinafter
sometimes referred to as the “Company”), and JPMORGAN CHASE BANK, N.A., a national banking
association organized under the laws of the United States of America, with its corporate trust
offices at 4 New York Plaza, New York, New York 10004 (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 (as
supplemented, 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 effective November 13, 2004, the name of JPMorgan Chase Bank was changed to JPMorgan
Chase Bank, N.A.; and

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

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

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

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

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

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

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

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

WHEREAS, the Indenture provides for the issuance of bonds thereunder in one or more series,
and the Company, by appropriate corporate action in conformity with the terms of the Indenture, has
duly determined to create, and does hereby create, a new series of bonds under the Indenture
designated 5.65% Insured Quarterly Notes Due 2035, each of which bonds shall also bear the
descriptive title “First Mortgage Bonds” (hereinafter provided for and hereinafter sometimes
referred to as the “IQ Notes”), 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 in the title thereof and
are to mature April 15, 2035; and

WHEREAS, the Company and Ambac Assurance Corporation (the “Insurer”) have entered into an
Insurance Agreement dated as of April 13, 2005 (the “Insurance Agreement”) pursuant to which the
Insurer agreed to provide a financial guaranty insurance policy (the “Policy”) that will insure the
payment of principal and interest on the IQ Notes, subject to such limitations as set forth in the
Policy; and

WHEREAS the Company and Edward D. Jones & Co., L.P., Comerica Securities, Inc., Goldman, Sachs
& Co., Wachovia Capital Markets, LLC and Fifth Third Securities, Inc. (the “Underwriters”) have
entered into an Underwriting Agreement dated April 7, 2005 (the “Underwriting Agreement”), pursuant
to which the Company agreed to sell and the Underwriters agreed to buy $150,000,000 in aggregate
principal amount of IQ Notes (such IQ Notes, the “Bonds”); and

WHEREAS, each of the registered bonds without coupons of IQ Notes and the Trustee’s
Authentication Certificate thereon are to be substantially in the following form, respectively, to
wit:

[FORM OF REGISTERED BOND OF THE IQ NOTES]

[FACE]

THIS BOND IS A GLOBAL BOND REGISTERED IN THE NAME OF THE DEPOSITARY (REFERRED TO HEREIN) OR A
NOMINEE THEREOF AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL BONDS
REPRESENTED HEREBY, THIS GLOBAL BOND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO
A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE
OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS GLOBAL BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK), A NEW YORK CORPORATION (THE
“DEPOSITARY”), TO THE TRUSTEE FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT IS MADE TO CEDE & CO.,
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

Financial Guaranty Insurance Policy No. 23828BE (the “Policy”) with respect to payments due
for principal and interest, and payments due on redemption at the request of a Representative (as
defined below), on this IQ Note has been issued by Ambac Assurance Corporation (“Ambac Assurance”).
The Policy has been delivered to The Bank of New York, New York, New York, as the Insurance
Trustee under said Policy and will be held by such Insurance Trustee or any successor insurance
trustee. The Policy is on file and available for inspection at the principal office of the
Insurance Trustee and a copy thereof may be secured from Ambac Assurance or the Insurance Trustee.
All payments required to be made under the Policy shall be made in accordance with the provisions
thereof. The owner of this IQ Note acknowledges and consents to the subrogation rights of Ambac
Assurance as more fully set forth in the Policy.

CONSUMERS ENERGY COMPANY

FIRST MORTGAGE BOND

5.65% INSURED QUARTERLY NOTES DUE 2035

CUSIP:      $150,000,000

ISIN:      

No.:

CONSUMERS ENERGY COMPANY, a Michigan corporation (hereinafter called the “Company”), for value
received, hereby promises to pay to Cede & Co., or registered assigns, the principal sum of One
Hundred Fifty Million Dollars ($150,000,000) on April 15, 2035, and to pay to the registered holder
hereof interest on said sum from the latest quarterly interest payment date to which interest has
been paid on the bonds of this series preceding the date hereof, unless the date hereof be an
interest payment date to which interest is being paid, in which case from the date hereof, or
unless the date hereof is prior to July 15, 2005 in which case from April 13, 2005 (or if this bond
is dated between the record date for any interest payment date and such interest payment date, then
from such interest payment date, provided, however, that if the Company shall default in payment of
the interest due on such interest payment date, then from the next preceding quarterly interest
payment date to which interest has been paid on the bonds of this series, or if such interest
payment date is July 15, 2005, from April 13, 2005), at the rate per annum, until the principal
hereof shall have become due and payable, specified in the title of this bond, payable on January
15, April 15, July 15 and October 15 in each year. 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, N.A., Trustee

By:

Authorized Officer

[REVERSE]

CONSUMERS ENERGY COMPANY

FIRST MORTGAGE BOND

5.65% INSURED QUARTERLY NOTES DUE 2035

The interest payable on any January 15, April 15, July 15 or October 15 will, subject to
certain exceptions provided in the Indenture hereinafter mentioned, be paid to the person in whose
name this bond is registered at the close of business on the record date, which shall be the first
calendar day of the month in which such interest payment date occurs, or, if such January 15, April
15, July 15 or October 15 shall be a legal holiday or a day on which banking institutions in the
Borough of Manhattan, The City of New York, are authorized to close, the next preceding day which
shall not be a legal holiday or a day on which such institutions are so authorized to close. The
principal of and the premium, if any, and interest on this bond shall be payable at the office or
agency of the Company in the Borough of Manhattan, The City of New York, designated for that
purpose, in any coin or currency of the United States of America which at the time of payment is
legal tender for public and private debts.

This bond is one of the bonds of a series designated as First Mortgage Bonds, 5.65% Insured
Quarterly Notes due 2035 (sometimes herein referred to as the “IQ Notes” or the “Bonds”) issued and
to be issued from time to time 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, N.A., 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 IQ Notes are redeemable at the option of the Company, in whole or in part, without premium
or penalty, at any time or from time to time on or after April 15, 2010, upon not less than 30 nor
more than 60 days’ notice at a redemption price equal to 100% of the principal amount to be
redeemed plus accrued and unpaid interest to the redemption date. In addition, at the option of
any deceased Beneficial Owner’s Representative (as such terms are defined in the Indenture),
interests in the IQ Notes are redeemable at 100% of their principal amount, plus accrued and upaid
interest, subject to certain limitations provided in, and in accordance with the terms of, the
Indenture.

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 reduce any premium
payable on the redemption hereof, (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 upon the approval or consent of the holders of which modifications or
alterations may be made as aforesaid.

The Company reserves the right, without any consent, vote or other action by holders of the IQ
Notes 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 premium, if any, 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.

[END OF FORM OF REGISTERED BOND OF THE IQ NOTES]

- — - — - — - — - — - — - — -

AND WHEREAS all acts and things necessary to make the IQ Notes ( referred to herein as the
“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, this Supplemental
Indenture, 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, 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 $150,000,000 principal amount of the IQ Notes, 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, alienate and convey unto JPMorgan Chase Bank, N.A., 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 12 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;

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 “IQ Notes”) 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 IQ Notes shall be issued in
the aggregate principal amount of $150,000,000, shall mature on April 15, 2035 and shall be issued
only as registered bonds without coupons in denominations of $1,000 and any multiple thereof. The
serial numbers of the IQ Notes 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 IQ Notes shall bear interest at the rate per annum, until the
principal thereof shall have become due and payable, specified in the title thereto, payable
quarterly on January 15, April 15, July 15 and October 15 in each year. The principal of and the
premium, if any, and the interest on said bonds shall be payable in any coin or currency of the
United States of America which at the time of payment is legal tender for public and private debts,
at the office or agency of the Company in the City of New York, designated for that purpose.

	 	 	 
	SECTION 2.FORM, EXCHANGE AND CERTIFICATED BONDS
	2.01

	 	Form of Bonds.
	
 
	 	 

The IQ Notes shall be issued initially in the form of one or more permanent Global Bonds in
definitive, fully registered form without interest coupons with the global securities legend (each,
a “Global Bond”), which shall be deposited on behalf of the purchasers of the Bonds represented
thereby with the Trustee, at its corporate trust office, as securities custodian (or with such
other securities custodian as the Depository (as defined below) may direct), and registered in the
name of the Depository or a nominee of the Depository, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the Global
Bonds may from time to time be increased or decreased by adjustments made on the records of the
Trustee and the Depository or its nominee as hereinafter provided. The Depositary for the Global
Bonds shall be The Depository Trust Company, a New York corporation, or its duly appointed
successor (the “Depository”). This Section 2.01 shall apply only to a Global Bond deposited with
or on behalf of the Depository.

The Company shall execute and the Trustee shall, in the case of each of the IQ Notes in
accordance with this Section 2.01, authenticate and deliver initially one or more Global Bonds that
(a) shall be registered in the name of the Depository or the nominee of the Depository and (b)
shall be delivered by the Trustee to the Depository or pursuant to the Depository’s instructions or
held by the Trustee as securities custodian.

Members of, or participants in, the Depository (“Agent Members”) shall have no rights under
this Supplemental Indenture with respect to any Global Bond held on their behalf by the Depository
or by the Trustee as the securities custodian or under such Global Bond, and the Company, the
Trustee and any agent of the Company or the Trustee shall be entitled to treat the Depository as
the absolute owner of such Global Bond for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Company, the Trustee or any agent of the Company from giving
effect to any written certification, proxy or other authorization furnished by the Depository or
impair, as between the Depository and its Agent Members, the operation of customary practices of
such Depository governing the exercise of the rights of a holder of a beneficial interest in any
Global Bond.

Except as provided in this Section 2.01, Section 2.02 or Section 2.03, owners of beneficial
interests in Global Bonds shall not be entitled to receive physical delivery of certificated Bonds.

2.02 Transfer and Exchange.

(a) Transfer and Exchange of Global Bonds.

(i) The transfer and exchange of Global Bonds or beneficial interests therein shall
be effected through the Depository, in accordance with this Supplemental Indenture
(including applicable restrictions on transfer set forth herein, if any) and the
procedures of the Depository therefor.

(ii) Notwithstanding any other provision of this Supplemental Indenture (other than
the provisions set forth in Section 2.03), a Global Bond may not be transferred as a whole
except by the Depository to a nominee of the Depository or by a nominee of the Depository
to the Depository or another nominee of the Depository or by the Depository or any such
nominee to a successor Depository or a nominee of such successor Depository.

(b) Cancellation or Adjustment of Global Bond. At such time as all beneficial
interests in a Global Bond have either been exchanged for certificated Bonds, redeemed, purchased
or canceled, such Global Bond shall be canceled by the Trustee. At any time prior to such
cancellation, if any beneficial interest in a Global Bond is exchanged for certificated Bonds,
redeemed, purchased or canceled, the principal amount of Bonds represented by such Global Bond
shall be reduced and an adjustment shall be made on the books and records of the securities
custodian with respect to such Global Bond.

(c) Obligations with Respect to Transfers and Exchanges of Bonds.

(i) To permit registrations of transfers and exchanges, the Company shall execute and
the Trustee shall authenticate certificated Bonds and Global Bonds at the security
registrar’s request.

(ii) No service charge shall be made for registration of transfer or exchange, but
the Company may require payment of a sum sufficient to cover any transfer tax, assessments
or similar governmental charge payable in connection therewith.

(iii) Prior to the due presentation for registration of transfer of any Bond, the
Company, the Trustee, the paying agent or the security registrar may deem and treat the
person in whose name a Bond is registered as the absolute owner of such Bond for the
purpose of receiving payment of principal of and interest on such Bond and for all other
purposes whatsoever, whether or not such Bond is overdue, and none of the Company, the
Trustee, the paying agent or the security registrar shall be affected by notice to the
contrary.

(iv) All Bonds issued upon any transfer or exchange pursuant to the terms of the
Indenture shall evidence the same debt and shall be entitled to the same benefits under
the Indenture as the Bonds surrendered upon such transfer or exchange.

(d) No Obligation of Trustee.

(i) The Trustee (whether in its capacity as Trustee or otherwise) shall have no
responsibility or obligation to any beneficial owner of a Global Bond, Agent Member or
other person with respect to the accuracy of the records of the Depository or its nominee
or of any Agent Member, with respect to any ownership interest in the Bonds or with
respect to the delivery to any Agent Member, beneficial owner or other person (other than
the Depository) of any notice (including any notice of redemption) or the payment of any
amount, under or with respect to such Bonds. All notices and communications to be given
to the holders and all payments to be made to holders under the Bonds shall be given or
made only to or upon the order of the registered holders (which shall be the Depository or
its nominee in the case of a Global Bond). The rights of beneficial owners in any Global
Bond shall be exercised only through the Depository subject to the applicable rules and
procedures of the Depository. The Trustee may rely and shall be fully protected in
relying upon information furnished by the Depository with respect to its Agent Members and
any beneficial owners.

(ii) The Trustee shall have no obligation or duty to monitor, determine or inquire as
to compliance with any restrictions on transfer imposed under this Supplemental Indenture
or under applicable law with respect to any transfer of any interest in any Bond
(including any transfers between or among Agent Members or beneficial owners in any Global
Bond) other than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly required by, the
terms of the Indenture.

2.03 Certificated Bonds.

(a) A Global Bond deposited with the Depository or with the Trustee as securities custodian
pursuant to Section 2.01 shall be transferred to the beneficial owners thereof in the form of
certificated Bonds in an aggregate principal amount equal to the principal amount of such Global
Bond, in exchange for such Global Bond, only if such transfer complies with this Section 2.03 and
the conditions set forth in Article II of the Indenture.

(b) Any Global Bond that is transferable to the beneficial owners thereof pursuant to this
Section 2.03 shall be surrendered by the Depository to the Trustee at its corporate trust office to
be so transferred, in whole or from time to time in part, without charge, and the Trustee shall
authenticate and deliver, upon such transfer of each portion of such Global Bond, an equal
aggregate principal amount of certificated Bonds of authorized denominations. Any portion of a
Global Bond transferred pursuant to this Section 2.03 shall be executed, authenticated and
delivered only in denominations of $1,000 principal amount and any integral multiple thereof and
registered in such names as the Depository shall direct.

(c) Subject to the provisions of Section 2.03(b), the registered holder of a Global Bond shall
be entitled to grant proxies and otherwise authorize any person, including Agent Members and
persons that may hold interests through Agent Members, to take any action which a holder is
entitled to take under the Indenture or the Bonds.

	 	 	 
	SECTION 3.	 	REDEMPTION
	
 
	 	SECTION 3.01. Redemption at the Company’s Option.

The IQ Notes are redeemable at the option of the Company, in whole or in part, without premium
or penalty, at any time or from time to time on or after April 15, 2010, upon not less than 30 nor
more than 60 days’ notice at a redemption price equal to 100% of the principal amount to be
redeemed plus unpaid accrued interest to the redemption date.

If notice of redemption is given as aforesaid, the IQ Notes so to be redeemed shall, on the
redemption date, become due and payable at the redemption price together with any accrued interest
thereon, and from and after such date (unless the Company shall default in the payment of the
redemption price and accrued interest) the IQ Notes shall cease to bear interest. If any IQ Note
called for redemption shall not be paid upon surrender thereof for redemption, the principal shall,
until paid, bear interest from the redemption date at a rate of 5.65% per annum. Subject to the
foregoing and applicable law (including without limitation, United States federal securities laws),
the Company or its affiliates may, at any time and from time to time, purchase outstanding IQ Notes
by tender, in the open market or by private agreement; provided, however, the Company may not use
any purchased IQ Notes as a credit against any redemption obligation.

SECTION 3.02. Redemption at the Holder’s Option. For purposes of this Section 3.02 a
“Beneficial Owner” means the person who has the right to sell, transfer or otherwise dispose of an
interest in the IQ Notes and the right to receive the proceeds therefrom, as well as the interest
and principal payable to the holder thereof. In general, a determination of beneficial ownership
in the IQ Notes will be subject to the rules, regulations and procedures governing the depositary
and institutions that have accounts with the depositary or a nominee thereof (the “Participants”).

Unless the IQ Notes have been declared due and payable prior to their maturity by reason of a
default (as defined in the Indenture), the personal representative or other person authorized to
represent the estate of the deceased Beneficial Owner or from a surviving joint tenant(s) or
tenant(s) by the entirety or the trustee of a trust (each, a “Representative”) of a deceased
Beneficial Owner has the right to request redemption prior to the stated maturity of all or part of
such deceased Beneficial Owner’s interest, expressed in integral multiples of $1,000 principal
amount, in the IQ Notes, and the Company will redeem the same subject to the limitations that the
Company will not be obligated to redeem, during the period from April 13, 2005 through and
including April 15, 2006 (the “Initial Period”), and during any twelve-month period which ends on
and includes each April 15 thereafter (each such twelve-month period being hereinafter referred to
as a “Subsequent Period”), (i) on behalf of a deceased Beneficial Owner any interest in the IQ
Notes which exceeds an aggregate principal amount of $35,000 (the “Individual Limitation”) or (ii)
interests in the IQ Notes in an aggregate principal amount exceeding $3,000,000 (the “Annual
Limitation”). Representatives of deceased Beneficial Owners must make arrangements with the
Participant through whom such interest is owned in order that timely presentation of redemption
requests can be made by the Participant to the Trustee. The Trustee shall maintain records with
respect to such redemption requests received by it including date of receipt, the name of the
Participant filing the redemption request and the status of each such redemption request with
respect to the Individual Limitation and the Annual Limitation. The Trustee shall immediately file
each redemption request it receives, together with the information regarding the eligibility
thereof with respect to the Individual Limitation and Annual Limitation, with the Company. The
depositary, the Trustee and the Company may conclusively assume, without independent investigation,
that the statements contained in each redemption request are true and correct and shall have no
responsibility for reviewing any documents submitted to the Participant by the Representative or
for determining whether the applicable decedent is in fact the Beneficial Owner of the Interest in
the IQ Notes to be redeemed or is in fact deceased and whether the Representative is duly
authorized to request redemption on behalf of the applicable Beneficial Owner.

Subject to the Individual Limitation and the Annual Limitation, the Company will, after the
death of any Beneficial Owner, redeem the interest of such Beneficial Owner in the IQ Notes on the
next interest payment date occurring not less than 30 days following receipt by the Company of a
redemption request received from the Trustee. If redemption requests exceed the aggregate
principal amount of interests in IQ Notes required to be redeemed during the Initial Period or
during any Subsequent Period, then such excess redemption requests will be applied in the order
received by the Trustee to successive Subsequent Periods, regardless of the number of Subsequent
Periods required to redeem such interests. The Company may at any time notify the Trustee that it
will redeem, on the next interest payment date occurring not less than 30 days thereafter, all or
any such lesser amount of IQ Notes for which redemption requests have been received but which are
not then eligible for redemption by reason of the Individual Limitation and the Annual Limitation.
All redemption requests will be redeemed in the order in which the Trustee receives the redemption
request. To obtain repayment pursuant to a redemption request, the Representative must provide to
the Participant (i) a written request for repayment signed by the Representative, and such
signature must be guaranteed by a member firm of a registered national securities exchange or of
the NASD or a commercial bank or trust company having an office or correspondent in the United
States, (ii) appropriate evidence satisfactory to the Company and the Trustee that (A) the
Representative has authority to act on behalf of the deceased Beneficial Owner, (B) the death of
such Beneficial Owner has occurred and (C) the deceased was the owner of a beneficial interest in
such IQ Note at the time of death, (iii) if applicable, a properly executed assignment or
endorsement, and (iv) if the beneficial interest in such IQ Note is held by a nominee of the
deceased Beneficial Owner, a certificate satisfactory to the Trustee from such nominee attesting to
the deceased’s ownership of a beneficial interest in such IQ Note. The Participant will provide
these documents to the Trustee. All questions as to the eligibility or validity of any exercise of
redemption on behalf of a deceased Beneficial Owner will be determined by the Company, in its sole
discretion, which determinations will be final and binding on all parties.

For purposes of this Section 3.02 an interest in IQ Notes held in tenancy by the entirety,
joint tenancy or by tenants in common will be deemed to be held by a single Beneficial Owner and
the death of a tenant by the entirety, joint tenant or tenant in common will be deemed the death of
a Beneficial Owner. The death of a person who, during his lifetime, was entitled to substantially
all of the rights of a Beneficial Owner of an interest in the IQ Notes will be deemed the death of
the Beneficial Owner, regardless of the recordation of such interest on the records of the
Participant, if such rights can be established to the satisfaction of the Participant and the
Company.

If the Company, although not obligated to do so, chooses to redeem interests of any deceased
Beneficial Owner in the IQ Notes in the Initial Period or any Subsequent Period in excess of the
Individual Limitation, such redemption, to the extent that it exceeds the Individual Limitation for
any deceased Beneficial Owner, shall not be included in the computation of the Annual Limitation
for such Initial Period or such Subsequent Period, as the case may be, or for any succeeding
Subsequent Period. The Company may, at its option, redeem interests of deceased Beneficial Owners
in the IQ Notes, in the Initial Period or any Subsequent Period in an aggregate principal amount
exceeding the Annual Limitation. Any such redemption, to the extent it exceeds the Annual
Limitation, shall not reduce the Annual Limitation for any Subsequent Period.

In the case of any redemption request which is presented pursuant to this Section 3.02 and
which has not been fulfilled at the time the Company gives notice of its election to redeem part of
the IQ Notes pursuant to Section 3.01 hereof, the IQ Notes which are the subject of such pending
redemption request shall be redeemed prior to any other IQ Notes.

The price the Company will pay for the IQ Notes to be redeemed pursuant to a redemption
request is 100% of the principal amount thereof plus accrued but unpaid interest to the redemption
date.

The principal amount of any IQ Notes acquired or redeemed by the Company other than by
redemption at the option of any Representative of a deceased Beneficial Owner pursuant to this
Section 3.02 shall not be included in the computation of either the Individual Limitation or the
Annual Limitation for the Initial Period or for any Subsequent Period.

Any redemption request may be withdrawn by the Representative upon delivery of a written
request for such withdrawal given by the Participant on behalf of the Representative to the
depositary and by the depositary to the Trustee not less than 60 days prior to the interest payment
date on which such IQ Notes are eligible for redemption.

The Company may, at its option, purchase any IQ Notes for which Redemption Requests have been
received in lieu of redeeming such IQ Notes. Any IQ Notes so purchased by the Company shall either
be reoffered for sale and sold within 180 days after the date of purchase or presented to the
Trustee for redemption and cancellation.

SECTION 4. The IQ Notes are not redeemable by the operation of the maintenance and replacement
provisions of the Indenture or with the proceeds of released property or in any other manner except
as set forth in Section 3 hereof.

SECTION 5. SPECIAL INSURANCE PROVISIONS

SECTION 5.01. Insurer as Third Party Beneficiary.

To the extent that the Indenture confers upon or gives or grants to Ambac Assurance
Corporation (the “Insurer”) any right, remedy or claim, the Insurer is hereby explicitly recognized
as being a third-party beneficiary thereunder and may enforce any such right remedy or claim
conferred, given or granted thereunder.

SECTION 5.02. Notices and Information.

(a) The Company shall furnish to the Insurer:

(i) Any notice that is required to be given to a holder of the IQ Notes or to the Trustee
pursuant to the Indenture.

(ii) As soon as practicable after the filing thereof, a copy of any financial statement of the
Company and a copy of any audit and annual report of the Company; a copy of any notice to be given
to the registered owners of the IQ Notes including, without limitation, notice of any redemption of
or defeasance of the IQ Notes; and such additional information it may reasonably request.

(b) The Company will permit the Insurer to discuss the affairs, finances and accounts of the
Company or any information the Insurer may reasonably request regarding the security for the IQ
Notes with appropriate officers of the Company. The Company will permit the Insurer to have access
to and to make copies of all books and records relating to the IQ Notes at any reasonable time.

(c) Notwithstanding any other provision of the Indenture, the Trustee and the Company shall
notify the Insurer if at any time there are insufficient moneys to make any payments of principal
and/or interest on the IQ Notes as required and promptly upon the occurrence of any default under
the Indenture or under or with respect to the IQ Notes.

All notices and information required to be given to the Insurer shall be in writing and shall
be sent by overnight delivery to Ambac Assurance Corporation, One State Street Plaza, New York, NY
10004, Attention: Surveillance Dept. – Global Utilities.

SECTION 5.03. Concerning the Special Insurance Provisions.

The provisions of this Section 5 shall apply notwithstanding anything in the Indenture to the
contrary, but only so long as the Policy shall be in full force and effect and the Insurer is not
in default thereunder.

SECTION 5.04. Amendments; Voting Rights.

Any provision of the Indenture expressly recognizing or granting rights in or to the Insurer
may not be amended in any manner which affects the rights of the Insurer hereunder without the
prior written consent of the Insurer. The Insurer’s consent shall be required in lieu of the
consent of the holders of IQ Notes or any of them, when required under the Indenture, for the
following purposes: (i) any amendment, supplement or change to or modification of this
Supplemental Indenture, the Indenture or the terms of the IQ Notes, (ii) removal of the Trustee or
Paying Agent and selection and appointment of any successor trustee or paying agent; and (iii)
initiation or approval of any action not described in (i) or (ii) above which requires the consent
of the holders of IQ Notes or any of them.

SECTION 5.05. Defeasance.

Notwithstanding anything herein or in the Indenture to the contrary, in the event that the
principal and/or interest due on the IQ Notes shall be paid by the Insurer pursuant to the Policy,
the IQ Notes shall remain outstanding for all purposes, not be defeased or otherwise satisfied and
not be considered paid by the Company, and the assignment and pledge of moneys held in trust by the
Trustee and all covenants, agreements and other obligations of the Company to the registered owners
of the IQ Notes shall continue to exist and shall run to the benefit of the Insurer, and the
Insurer shall be subrogated to the rights of such registered owners.

SECTION 5.06. Insurer’s Rights to Notice; Subrogation.

As long as the Policy shall be in full force and effect, the Company, the Trustee and any
Paying Agent agree to comply with the following provisions:

(a) If the Trustee or Paying Agent determines that there will be insufficient funds to pay the
principal of or interest on the IQ Notes on any date when payment is due, the Trustee or Paying
Agent shall so notify the Insurer within one business day after such determination. Such notice
shall specify the amount of the anticipated deficiency, the IQ Notes to which such deficiency is
applicable and whether such IQ Notes will be deficient as to principal or interest, or both. The
Insurer will make payments of principal or interest due, and payments due on receipt of a
redemption request from a Representative on the IQ Notes on or before the first day next following
the date on which the Insurer shall have received notice of nonpayment from the Trustee or Paying
Agent or the date when such payment is due, whichever occurs later.

(b) The Trustee or Paying Agent shall, after giving notice to the Insurer as provided in (a)
above, make available to the Insurer and, at the Insurer’s direction, to The Bank of New York, in
New York, New York, as insurance trustee for the Insurer or any successor insurance trustee (the
“Insurance Trustee”), the registration books of the Company maintained by the Trustee or Paying
Agent and all records relating to the IQ Notes maintained by the Trustee or the Paying Agent under
the Indenture.

(c) The Trustee or Paying Agent shall provide the Insurer and the Insurance Trustee with a
list of registered owners of IQ Notes entitled to receive principal or interest payments from the
Insurer under the terms of the Policy, and shall make arrangements with the Insurance Trustee (i)
to mail checks or pay by wire transfer to the registered owners of IQ Notes entitled to receive all
or partial interest payments from the Insurer and (ii) to pay principal upon IQ Notes surrendered
or otherwise assigned to the Insurance Trustee by the registered owners of IQ Notes entitled to
receive full or partial principal payments from the Insurer.

(d) The Trustee or Paying Agent shall, at the time it provides notice to the Insurer pursuant
to (a) above, notify registered owners of IQ Notes entitled to receive the payment of principal or
interest thereon from the Insurer (i) as to the fact of such entitlement, (ii) that the Insurer
will remit to them all or a part of the interest payments next coming due upon proof of any
holder’s entitlement to interest payments and delivery to the Insurance Trustee, in form
satisfactory to the Insurance Trustee, of an appropriate assignment of the registered owner’s right
to payment, (iii) that should they be entitled to receive full payment of principal from the
Insurer, they must surrender their IQ Notes (and/or provide an appropriate instrument of assignment
in form satisfactory to the Insurance Trustee to permit ownership of such IQ Notes to be registered
in the name of the Insurer) for payment to the Insurance Trustee, and not the Trustee or Paying
Agent and (iv) that should they be entitled to receive partial payment of principal from the
Insurer, they must surrender their IQ Notes (and/or provide an appropriate instrument of assignment
in form satisfactory to the Insurance Trustee) for payment thereon first to the Trustee or Paying
Agent who shall note on such IQ Notes (or in the registry for same) the portion of the principal
paid by the Company through the Trustee or Paying Agent and then to the Insurance Trustee, which
will then pay the unpaid portion of principal.

(e) In the event that the Trustee or Paying Agent has notice that any payment of principal of
or interest on IQ Notes which has become Due for Payment (as defined in the Policy) and which is
made to a holder of IQ Notes by or on behalf of the Company has been deemed a preferential transfer
and theretofore recovered from its registered owner pursuant to the United States Bankruptcy Code
by a trustee in bankruptcy in accordance with the final, nonappealable order of a court having
competent jurisdiction, the Trustee or Paying Agent shall, at the time the Insurer is notified
pursuant to (a) above, notify all registered owners that in the event that any registered owner’s
payment is so recovered, such registered owner will be entitled to payment from the Insurer to the
extent of such recovery if sufficient funds are not otherwise available, and the Trustee or Paying
Agent shall furnish to the Insurer its records evidencing the payments of principal of and interest
on the IQ Notes which have been made by the Trustee or Paying Agent and subsequently recovered from
registered owners and the dates on which such payments were made.

(f) In addition to those rights granted the Insurer under the Indenture, the Insurer shall, to
the extent it makes payment of principal of or interest on the IQ Notes, become subrogated to the
rights of the recipients of such payments in accordance with the terms of the Policy, and to
evidence such subrogation (i) in the case of subrogation as to claims for past due interest, the
Trustee or Paying Agent shall note the Insurer’s rights as subrogee on the registration books of
the Company maintained by the Trustee or Paying Agent upon receipt from the Insurer of proof of the
payment of interest thereon to the registered owners of the IQ Notes, and (ii) in the case of
subrogation as to claims for past due principal, the Trustee or Paying Agent shall note the
Insurer’s rights as subrogee on the registration books of the Company maintained by the Trustee or
Paying Agent upon surrender of the IQ Notes by the registered owners thereof together with proof
from the Insurer of the payment of principal thereof.

SECTION 5.07. Insurer’s Rights Concerning the Trustee.

(a) The Insurer shall receive prompt written notice from the Company of any Trustee or Paying
Agent resignation. The Company shall not appoint a successor Trustee or Paying Agent without the
prior approval of the Insurer.

(b) Notwithstanding any other provision of the Indenture, in determining whether the rights of
the holders of IQ Notes will be adversely affected in any material respect by any action taken
pursuant to the terms and provisions of the Indenture, the Trustee or Paying Agent shall consider
the effect on the holders of IQ Notes as if there were no Policy.

SECTION 5.08. Insurer’s Rights.

Anything in the Indenture to the contrary notwithstanding, upon the occurrence and continuance
of a default, so long as the Policy shall be in full force and effect and the Insurer is not in
default under the terms of the Policy, the Insurer shall be entitled to control and direct the
enforcement of all rights and remedies granted to the holders of IQ Notes.

SECTION 5.09. No Third Party Beneficiary.

Nothing contained in this Supplemental Indenture expressed or implied is intended or shall be
construed to confer upon, or to give or grant to, any person or entity, other than a holder of
bonds issued under the Indenture, as supplemented and amended as above set forth, the Company, the
Trustee, the Paying Agent and the Insurer, any right, remedy or claim under or by reason of this
Supplement or any covenant, condition or stipulation hereof, and all covenants, stipulations,
promises and agreements in this Supplement contained by and on behalf of the Company shall be for
the sole and exclusive benefit of the Company, the Trustee, the Paying Agent, the Insurer and the
holders of the bonds.

SECTION 5.10. Additional Default.

The Company agrees to comply with all the covenants, terms and conditions set forth in the
Insurance Agreement and to ensure that no Event of Default (as defined therein) occurs thereunder.
If an Event of Default (as defined in the Insurance Agreement) occurs, the Insurer shall give
notice thereof to the Trustee and the Trustee shall thereupon demand that the Company cure such
failure as set forth in Section 11.01(f) of the Indenture. As provided in Section 11.01(f) of the
Indenture, the failure to cure such failure within the time period set forth therein, shall be a
default under the Indenture.

SECTION 6. The Company reserves the right, without any consent, vote or other action by the
holders of the IQ Notes or of any subsequent series of bonds issued under the Indenture, to make
such amendments to the Indenture, as supplemented, as shall be necessary in order to amend Section
17.02 to read as follows:

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

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

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

The Company and the Trustee, if they so elect, and either before or
after such consent has been obtained, may require the holder of any bond
consenting to the execution of any such supplemental indenture to submit his
bond to the Trustee or to ask such bank, banker or trust company as may be
designated by the Trustee for the purpose, for the notation thereon of the
fact that the holder of such bond has consented to the execution of such
supplemental indenture, and in such case such notation, in form satisfactory
to the Trustee, shall be made upon all bonds so submitted, and such bonds
bearing such notation shall forthwith be returned to the persons entitled
thereto.

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

SECTION 7. 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 8. 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, eighth and ninth recitals hereof), all of
which recitals and statements are made solely by the Company.

SECTION 9. 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 10. In the event the date of any notice required or permitted hereunder shall not be a
Business Day (as defined below), 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 10, 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.

SECTION 11. This Supplemental Indenture and the IQ Notes 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 12. 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, 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 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.

IX.

OFFICE BUILDINGS, SERVICE BUILDINGS, GARAGES, ETC.

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

X.

TELEPHONE PROPERTIES AND

RADIO COMMUNICATION EQUIPMENT

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

XI.

OTHER REAL PROPERTY

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

ALCONA COUNTY

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

The East 330 feet of the South 660 feet of the SW 1/4 of the SW 1/4 of Section
8, T28N, R8E, except the West 264 feet of the South 330 feet thereof; said land
being more particularly described as follows: To find the place of beginning of this
description, commence at the Southwest corner of said section, run thence East along
the South line of said section 1243 feet to the place of beginning of this
description, thence continuing East along said South line of said section 66 feet to
the West 1/8 line of said section, thence N 02 degrees 09’ 30” E along the said West
1/8 line of said section 660 feet, thence West 330 feet, thence S 02 degrees 09’ 30”
W, 330 feet, thence East 264 feet, thence S 02 degrees 09’ 30” W, 330 feet to the
place of beginning.

ALLEGAN COUNTY

Certain land in 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” 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 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 degrees 21’W 250 feet to the
North and South quarter line of said section, thence South along said North and
South quarter line of said section 200 feet to the place of beginning.

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.

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 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.

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 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:

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 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 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.

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.

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.)

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 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 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.

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 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; 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 13. The Company is a transmitting utility under Section 9501(2) of the Michigan
Uniform Commercial Code (M.C.L. 440.9501(2)) as defined in M.C.L. 440.9102(1)(aaaa).

IN WITNESS WHEREOF, said Consumers Energy Company has caused this Supplemental Indenture to be
executed in its corporate name by its Chairman of the Board, President, a Vice President or its
Treasurer and its corporate seal to be hereunto affixed and to be attested by its Secretary or an
Assistant Secretary, and said JPMorgan Chase Bank, N.A., 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.

2

CONSUMERS ENERGY COMPANY

	 	 	 	 	 	 	 	 	 
	(SEAL)	 	By: /s/ Laura L. Mountcastle

	 	 	 

	 
	 	 	 	 	 	Laura L. Mountcastle

	 
	 	 	 	 	 	Vice President and Treasurer

	Attest:
	 	 	 	 	 	 	 	 
	/s/ Joyce H. Norkey
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Joyce H. Norkey
Assistant Secretary
	 	 	 	 	 	 	 	 
	Signed, sealed and delivered
by CONSUMERS ENERGY COMPANY
in the presence of
	 	 	 	 	 	 	 	 
	/s/ Kimberly C. Wilson
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Kimberly C. Wilson
	 	 	 	 	 	 	 	 
	/s/ Sammie B. Dalton
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Sammie B. Dalton
	 	 	 	 	 	 	 	 
	STATE OF MICHIGAN
	 	 	)	 	 	 	 	 
	 
	 	ss.
	 	 	 	 
	COUNTY OF JACKSON
	 	 	)	 	 	 	 	 

The foregoing instrument was acknowledged before me this 13th day of April, 2005,
by Laura L. Mountcastle, Vice President and Treasurer of CONSUMERS ENERGY COMPANY, a Michigan
corporation, on behalf of the corporation.

	 	 	 
	
 
	 	/s/ Margaret Hillman
	
 
	 	 
	[Seal]

	 	Margaret Hillman, Notary Public

State of Michigan, County of Jackson

	 	 	 	My Commission Expires: 06/14/10

Acting in the County of Jackson

	 	 	 
	
 
	 	JPMORGAN CHASE BANK, N.A., AS TRUSTEE
	 
	 	 
	(SEAL)

	 	By: /s/ L. O’Brien
	
 
	 	 

	 	L.	 	O’Brien

Vice President

Attest:

/s/ Rosa Ciaccia

Rosa Ciaccia

Trust Officer

Signed, sealed and delivered

by JPMORGAN CHASE BANK, N.A.

in the presence of

/s/ Paul Schmalzel

Paul Schmalzel

/s/ Albert Mari

Albert Mari

	 	 	 	 	 
	STATE OF NEW YORK
	 	 	)	 
	 
	 	ss.
	COUNTY OF KING
	 	 	)	 

The foregoing instrument was acknowledged before me this 13th day of April, 2005,
by L. O’Brien, a Vice President of JPMORGAN CHASE BANK, N.A., as Trustee, a national banking
association, on behalf of the bank.

	 	 	 
	
 
	 	/s/ Rosita Walters
	
 
	 	 
	[Seal]

	 	ROSITA WALTERS

Notary Public, State of New York

No. 01WA6048854

Qualified in Kings County

Commission Expires Oct. 2, 2006
	 
	 	 
	Prepared by:

	 	When recorded, return to:
	Kimberly C. Wilson

One Energy Plaza, EP11-219

Jackson, MI 49201

	 	Consumers Energy Company

Business Services Real Estate Dept.

Attn: Nancy Fisher, EP7-439

One Energy Plaza

Jackson, MI 49201
	 
	 	 

3

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