Document:

<PAGE>

                                                                    Exhibit 4.14

                     CAPITAL SECURITIES GUARANTEE AGREEMENT

                             BAC Capital Trust [__]

                          Dated as of [________, ____]

<PAGE>

                             CROSS-REFERENCE TABLE*

         Section of
         Trust Indenture Act                                     Section of
         of 1939, as amended                                     Declaration
         -------------------                                     -----------

         310(a)..............................................    4.1(a)
         310(c)..............................................    Inapplicable
         311(c)..............................................    Inapplicable
         312(a)..............................................    2.2(a)
         312(b)..............................................    2.2(b)
         313.................................................    2.3
         314(a)..............................................    2.4
         314(b)..............................................    Inapplicable
         314(c)..............................................    2.5
         314(d)..............................................    Inapplicable
         314(f)..............................................    Inapplicable
         315(a)..............................................    3.1(d)
         315(c)..............................................    3.1(c)
         315(d)..............................................    3.1(d)
         _________________

*        This Cross-Reference Table does not constitute part of the Capital
Securities Guarantee and shall not affect the interpretation of any of its terms
or provisions.

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<S>                                                                                                     <C>
                                                 ARTICLE 1
                                      DEFINITIONS AND INTERPRETATION

SECTION 1.1    Definitions and Interpretation......................................................       1

                                                 ARTICLE 2
                                            TRUST INDENTURE ACT

SECTION 2.1    Trust Indenture Act; Application....................................................       5
SECTION 2.2    Lists of Holders of Securities......................................................       5
SECTION 2.3    Reports by the Capital Securities Guarantee Trustee.................................       5
SECTION 2.4    Periodic Reports to Capital Securities Guarantee Trustee............................       5
SECTION 2.5    Evidence of Compliance with Conditions Precedent....................................       5
SECTION 2.6    Events of Default; Waiver...........................................................       6
SECTION 2.7    Event of Default; Notice............................................................       6
SECTION 2.8    Conflicting Interests...............................................................       6

                                                 ARTICLE 3
                     POWERS, DUTIES AND RIGHTS OF CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 3.1    Powers and Duties of the Capital Securities Guarantee Trustee.......................       6
SECTION 3.2    Certain Rights of Capital Securities Guarantee Trustee..............................       8
SECTION 3.3    Not Responsible for Recitals or Issuance of Capital Securities Guarantee............      10

                                                 ARTICLE 4
                                   CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 4.1    Capital Securities Guarantee Trustee; Eligibility...................................      10
SECTION 4.2    Appointment, Removal and Resignation of Capital Securities Guarantee Trustee........      11

                                                 ARTICLE 5
                                                 GUARANTEE

SECTION 5.1    Guarantee...........................................................................      12
SECTION 5.2    Waiver of Notice and Demand.........................................................      12
SECTION 5.3    Obligations Not Affected............................................................      12
SECTION 5.4    Rights of Holders...................................................................      13
SECTION 5.5    Guarantee of Payment................................................................      13
SECTION 5.6    Subrogation.........................................................................      13
SECTION 5.7    Independent Obligations.............................................................      14

                                                 ARTICLE 6
                                 LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.1    Limitation of Transactions..........................................................      14
SECTION 6.2    Ranking.............................................................................      14

                                                 ARTICLE 7
                                                TERMINATION

SECTION 7.1    Termination.........................................................................      15
</TABLE>

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                                TABLE OF CONTENTS

<TABLE>
<S>                                                                       <C>
                                    ARTICLE 8
                                 INDEMNIFICATION

SECTION 8.1    Exculpation..............................................   15
SECTION 8.2    Indemnification..........................................   15

                                    ARTICLE 9
                                  MISCELLANEOUS

SECTION 9.1    Successors and Assigns...................................   16
SECTION 9.2    Amendments...............................................   16
SECTION 9.3    Notices..................................................   16
SECTION 9.4    Benefit..................................................   17
SECTION 9.5    Governing Law............................................   17
</TABLE>

                                       ii

<PAGE>

                     CAPITAL SECURITIES GUARANTEE AGREEMENT

                  This GUARANTEE AGREEMENT (the "Capital Securities Guarantee"),
dated as of [_______, ____], is executed and delivered by BANK OF AMERICA
CORPORATION, a Delaware corporation (the "Guarantor"), and THE BANK OF NEW YORK,
a New York banking corporation, as trustee (the "Capital Securities Guarantee
Trustee"), for the benefit of the Holders (as defined herein) from time to time
of the Capital Securities (as defined herein) of BAC Capital Trust [__], a
Delaware statutory business trust (the "Issuer").

                  WHEREAS, pursuant to an Amended and Restated Declaration of
Trust (the "Declaration"), dated as of [________, ____], among the trustees of
the Issuer named therein, the Guarantor, as sponsor, and the holders from time
to time of undivided beneficial interests in the assets of the Issuer, the
Issuer is issuing on the date hereof _________ Capital Securities representing
undivided preferred beneficial interests in the assets of the Issuer, having an
aggregate liquidation amount of $[__], designated the___% Capital Securities
(the "Capital Securities");

                  WHEREAS, as incentive for the Holders to purchase the Capital
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Capital Securities Guarantee, to pay to the Holders
of the Capital Securities the Guarantee Payments (as defined herein) and to make
certain other payments on the terms and conditions set forth herein.

                  WHEREAS, the Guarantor also is executing and delivering a
guarantee agreement (the "Common Securities Guarantee") for the benefit of the
holders of the Common Securities (as defined herein);

                  NOW, THEREFORE, in consideration of the purchase by each
Holder of Capital Securities, which purchase the Guarantor hereby agrees shall
benefit the Guarantor, the Guarantor executes and delivers this Capital
Securities Guarantee for the benefit of the Holders.

                                   ARTICLE 1

                         DEFINITIONS AND INTERPRETATION

SECTION 1.1       Definitions and Interpretation.
                  ------------------------------

                  In this Capital Securities Guarantee, unless the context
otherwise requires:

                  (a)      Capitalized terms used in this Capital Securities
                           Guarantee but not defined in the preamble above have
                           the respective meanings assigned to them in this
                           Section 1.1;

                  (b)      terms defined in the Declaration as at the date of
                           execution of this Capital Securities Guarantee have
                           the same meaning when used in this Capital Securities
                           Guarantee;

                                       1

<PAGE>

                  (c)       a term defined anywhere in this Capital Securities
                            Guarantee has the same meaning throughout;

                  (d)       all references to "the Capital Securities Guarantee"
                            or "this Capital Securities Guarantee" are to this
                            Capital Securities Guarantee as modified,
                            supplemented or amended from time to time;

                  (e)       all references in this Capital Securities Guarantee
                            to Articles and Sections are to Articles and
                            Sections of this Capital Securities Guarantee,
                            unless otherwise specified;

                  (f)       a term defined in the Trust Indenture Act has the
                            same meaning when used in this Capital Securities
                            Guarantee, unless otherwise defined in this Capital
                            Securities Guarantee or unless the context otherwise
                            requires; and

                  (g)       a reference to the singular includes the plural and
                            vice versa.

                  "Affiliate" has the same meaning as given to that term in Rule
                   ---------
405 of the Securities Act of 1933, as amended, or any successor rule thereunder.

                  "Authorized Officer" means the Chief Executive Officer,
                   ------------------
President, Chief Financial Officer, any Vice President, Treasurer, Assistant
Treasurer, Associate General Counsel or other person authorized to bind a
person.

                  "Business Day" means any day other than a day on which federal
                   ------------
or state banking institutions in New York, New York or Charlotte, North Carolina
are authorized or obligated by law, executive order or regulation to close.

                  "Capital Securities Guarantee Trustee" means The Bank of New
                   ------------------------------------
York, a New York banking corporation, until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Capital Securities Guarantee and thereafter means each such
Successor Capital Securities Guarantee Trustee.

                  "Capital Securities" means the total number of ___% Capital
                   ------------------
Securities (liquidation amount $[__] per Capital Security) issued pursuant to
the Declaration representing undivided preferred beneficial interests in the
assets of the Issuer.

                  "Common Securities" means the securities representing
                   -----------------
undivided common beneficial interests in the assets of the Issuer.

                  "Corporate Trust Office" means the office of the Capital
                   ----------------------
Securities Guarantee Trustee at which the corporate trust business of the
Capital Securities Guarantee Trustee shall, at any particular time, be
principally administered, which office at the date of execution of this
Agreement is located at 101 Barclay Street, 21 West, New York, New York 10286.

                  "Covered Person" means any Holder or beneficial owner of
                   --------------
Capital Securities.

                                       2

<PAGE>

                  "Event of Default" means a default by the Guarantor on any of
                   ----------------
its payments or other obligations under this Capital Securities Guarantee.

                  "Guarantee Payments" means the following payments or
                   ------------------
distributions, without duplication, with respect to the Capital Securities, to
the extent not paid or made by the Issuer: (i) any accrued and unpaid
Distributions that are required to be paid on such Capital Securities to the
extent the Issuer shall have funds available therefor, (ii) the applicable
Redemption Price to the extent the Issuer has funds available therefor, with
respect to any Capital Securities called for redemption by the Issuer, and (iii)
upon a voluntary or involuntary dissolution, winding-up or termination of the
Issuer (other than in connection with the distribution of Notes to the Holders
in exchange for Capital Securities as provided in the Declaration), the lesser
of (a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Capital Securities to the date of payment, to the extent
the Issuer shall have funds available therefor, and (b) the amount of assets of
the Issuer remaining available for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution"). If an Event of Default
under, and as defined in, the Indenture has occurred and is continuing, the
rights of holders of the Common Securities to receive payments under the Common
Securities Guarantee are subordinated to the rights of Holders of Capital
Securities to receive Guarantee Payments under the Capital Securities Guarantee.

                  "Holder" shall mean any holder, as registered on the books and
                   ------
records of the Issuer, of any Capital Securities; provided, however, that in
                                                  --------  -------
determining whether the holders of the requisite percentage of Capital
Securities have given any request, notice, consent or waiver hereunder, "Holder"
shall not include the Guarantor or any Affiliate of the Guarantor.

                  "Indemnified Person" means the Capital Securities Guarantee
                   ------------------
Trustee, any Affiliate of the Capital Securities Guarantee Trustee, or any
officers, directors, shareholders, members, partners, employees,
representatives, nominees, custodians or agents of the Capital Securities
Guarantee Trustee.

                  "Indenture" means the Indenture dated as of October 1, 2001
                   ---------
among the Guarantor (the "Note Issuer") and The Bank of New York, as trustee,
together with any Board Resolution (as defined in the Indenture) or any
indenture supplemental thereto, pursuant to which certain subordinated debt
securities of the Note Issuer are to be issued to the Property Trustee (as
defined in the Declaration) of the Issuer.

                  "Majority in liquidation amount of the Securities" means,
                   ------------------------------------------------
except as provided by the Trust Indenture Act, a vote by Holder(s) of Capital
Securities, voting separately as a class, of more than 50% of the liquidation
amount (including the stated amount that would be paid on redemption,
liquidation, dissolution or otherwise, plus accrued and unpaid Distributions to
the date upon which the voting percentages are determined) of all Capital
Securities.

                  "Notes" means the series of junior subordinated debt
                   -----
securities of the Guarantor designated the ____% Junior Subordinated Deferrable
Interest Notes due [_____] held by the Property Trustee of the Issuer on behalf
of the Trust.

                                       3

<PAGE>

                  "Officers' Certificate" means, with respect to any Person, a
                   ---------------------
certificate signed by an Authorized Officer of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Capital Securities Guarantee shall include:

                  (a)  a statement that each officer signing the Officers'
         Certificate has read the covenant or condition and the definition
         relating thereto;

                  (b)  a brief statement of the nature and scope of the
         examination or investigation undertaken by each officer in
         rendering the Officers' Certificate;

                  (c)  a statement that each such officer has made such
         examination or investigation as, in such officer's opinion, is
         necessary to enable such officer to express an informed opinion as to
         whether or not such covenant or condition has been complied with; and

                  (d)  a statement as to whether, in the opinion of each such
         officer, such condition or covenant has bee complied with.

                  "Person" means a legal person, including any individual,
                   ------
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.

                  "Responsible Officer" means, with respect to the Capital
                   -------------------
Securities Guarantee Trustee, any officer within the Corporate Trust Office of
the Capital Securities Guarantee Trustee, including any vice president, any
assistant vice president, any assistant secretary, the treasurer, any assistant
treasurer or other officer of the Corporate Trust Office of the Capital
Securities Guarantee Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of that officer's knowledge of and familiarity with the
particular subject.

                  "Successor Capital Securities Guarantee Trustee" means a
                   ----------------------------------------------
successor Capital Securities Guarantee Trustee possessing the qualifications to
act as Capital Securities Guarantee Trustee under Section 4.1.

                  "Trust Indenture Act" means the Trust Indenture Act of 1939,
                   -------------------
as amended.

                  "Trust Securities" means the Common Securities and the Capital
                   ----------------
Securities.

                                       4

<PAGE>

                                   ARTICLE 2
                               TRUST INDENTURE ACT

SECTION 2.1       Trust Indenture Act; Application.
                  --------------------------------

                  (a) This Capital Securities Guarantee is subject to the
provisions of the Trust Indenture Act that are required to be part of this
Capital Securities Guarantee and shall, to the extent applicable, be governed by
such provisions; and

                  (b) If and to the extent that any provision of this Capital
Securities Guarantee limits, qualifies or conflicts with the duties imposed by
Sections 310 to 317, inclusive, of the Trust Indenture Act, such imposed duties
shall control.

SECTION 2.2       Lists of Holders of Securities.
                  ------------------------------

     (a)          The Guarantor shall provide the Capital Securities Guarantee
Trustee with a list, in such form as the Capital Securities Guarantee Trustee
may reasonably require, of the names and addresses of the Holders of the Capital
Securities ("List of Holders") as of such date, (i) within 10 days after each
record date, and (ii) at any other time within 30 days of receipt by the
Guarantor of a written request for a List of Holders as of a date no more than
10 days before such List of Holders is given to the Capital Securities Guarantee
Trustee; provided, that the Guarantor shall not be obligated to provide such
         --------
List of Holders at any time the List of Holders does not differ from the most
recent List of Holders given to the Capital Securities Guarantee Trustee by the
Guarantor. The Capital Securities Guarantee Trustee may destroy any List of
Holders previously given to it on receipt of a new List of Holders.

     (b)          The Capital Securities Guarantee Trustee shall comply with its
obligations under Sections 311(a), 311(b) and Section 312(b) of the Trust
Indenture Act.

SECTION 2.3       Reports by the Capital Securities Guarantee Trustee.
                  ---------------------------------------------------

                  Within 60 days after March 31 of each year, the Capital
Securities Guarantee Trustee shall provide to the Holders of the Capital
Securities such reports as are required by Section 313 of the Trust Indenture
Act, if any, in the form and in the manner provided by Section 313 of the Trust
Indenture Act. The Capital Securities Guarantee Trustee also shall comply with
the requirements of Section 313(d) of the Trust Indenture Act.

SECTION 2.4       Periodic Reports to Capital Securities Guarantee Trustee.
                  --------------------------------------------------------

                  The Guarantor shall provide to the Capital Securities
Guarantee Trustee such documents, reports and information, if any, as required
by Section 314 and the compliance certificate required by Section 314 of the
Trust Indenture Act in the form, in the manner and at the times required by
Section 314 of the Trust Indenture Act.

SECTION 2.5       Evidence of Compliance with Conditions Precedent.
                  ------------------------------------------------

                  The Guarantor shall provide to the Capital Securities
Guarantee Trustee such evidence of compliance with any conditions precedent, if
any, provided for in this Capital

                                       5

<PAGE>

Securities Guarantee that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.

SECTION 2.6       Events of Default; Waiver.
                  -------------------------

                  The Holders of a Majority in liquidation amount of Capital
Securities may, by vote, on behalf of the Holders of all of the Capital
Securities, waive any past Event of Default and its consequences. Upon such
waiver, any such Event of Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured, for every purpose of this
Capital Securities Guarantee, but no such waiver shall extend to any subsequent
or other default or Event of Default or impair any right consequent thereon.

SECTION 2.7       Event of Default; Notice.
                  ------------------------

                  (a) The Capital Securities Guarantee Trustee shall, within 90
days after the occurrence of an Event of Default, transmit by mail, first class
postage prepaid, to the Holders of the Capital Securities, notices of all Events
of Default actually known to a Responsible Officer of the Capital Securities
Guarantee Trustee, unless such defaults have been cured before the giving of
such notice, provided, that, the Capital Securities Guarantee Trustee shall be
protected in withholding such notice if and so long as a Responsible Officer of
the Capital Securities Guarantee Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of the Capital
Securities.

                  (b) The Capital Securities Guarantee Trustee shall not be
deemed to have knowledge of any Event of Default unless the Capital Securities
Guarantee Trustee shall have received written notice thereof, or unless a
Responsible Officer of the Capital Securities Guarantee Trustee charged with the
administration of the Declaration shall have obtained actual knowledge thereof.

SECTION 2.8       Conflicting Interests.
                  ---------------------

                  The Declaration shall be deemed to be specifically described
in this Capital Securities Guarantee for the purposes of clause (i) of the first
proviso contained in Section 310(b) of the Trust Indenture Act.

                                   ARTICLE 3
                          POWERS, DUTIES AND RIGHTS OF
                      CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 3.1       Powers and Duties of the Capital Securities Guarantee Trustee.
                  -------------------------------------------------------------

                  (a) This Capital Securities Guarantee shall be held by the
Capital Securities Guarantee Trustee for the benefit of the Holders of the
Capital Securities, and the Capital Securities Guarantee Trustee shall not
transfer this Capital Securities Guarantee to any Person except a Holder of
Capital Securities exercising his or her rights pursuant to Section 5.4(b) or to
a Successor Capital Securities Guarantee Trustee on acceptance by such Successor
Capital Securities Guarantee Trustee of its appointment to act as Successor
Capital Securities Guarantee

                                       6

<PAGE>

Trustee. The right, title and interest of the Capital Securities Guarantee
Trustee shall automatically vest in any Successor Capital Securities Guarantee
Trustee, and such vesting and cessation of title shall be effective whether or
not conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Capital Securities Guarantee Trustee.

                  (b) If an Event of Default actually known to a Responsible
Officer of the Capital Securities Guarantee Trustee has occurred and is
continuing, the Capital Securities Guarantee Trustee shall enforce this Capital
Securities Guarantee for the benefit of the Holders of the Capital Securities.

                  (c) The Capital Securities Guarantee Trustee, before the
occurrence of any Event of Default and after the curing of all Events of Default
that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Capital Securities Guarantee, and no implied
covenants shall be read into this Capital Securities Guarantee against the
Capital Securities Guarantee Trustee. In case an Event of Default has occurred
(that has not been cured or waived pursuant to Section 2.6) and is actually
known to a Responsible Officer of the Capital Securities Guarantee Trustee, the
Capital Securities Guarantee Trustee shall exercise such of the rights and
powers vested in it by this Capital Securities Guarantee, and use the same
degree of care and skill in its exercise thereof, as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.

                  (d) No provision of this Capital Securities Guarantee shall be
construed to relieve the Capital Securities Guarantee Trustee from liability for
its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:

                  (i) prior to the occurrence of any Event of Default and after
         the curing or waiving of all such Events of Default that may have
         occurred:

                      (A) the duties and obligations of the Capital Securities
                  Guarantee Trustee shall be determined solely by the express
                  provisions of this Capital Securities Guarantee, and the
                  Capital Securities Guarantee Trustee shall not be liable
                  except for the performance of such duties and obligations as
                  are specifically set forth in this Capital Securities
                  Guarantee, and no implied covenants or obligations shall be
                  read into this Capital Securities Guarantee against the
                  Capital Securities Guarantee Trustee; and

                      (B) in the absence of bad faith on the part of the Capital
                  Securities Guarantee Trustee, the Capital Securities Guarantee
                  Trustee may conclusively rely, as to the truth of the
                  statements and the correctness of the opinions expressed
                  therein, upon any certificates or opinions furnished to the
                  Capital Securities Guarantee Trustee and conforming to the
                  requirements of this Capital Securities Guarantee; but in the
                  case of any such certificates or opinions that by any
                  provision hereof are specifically required to be furnished to
                  the Capital Securities Guarantee Trustee, the Capital
                  Securities Guarantee Trustee shall be under a duty to examine
                  the same to determine whether or not they conform to the
                  requirements of this Capital Securities Guarantee;

                                       7

<PAGE>

                  (ii)  the Capital Securities Guarantee Trustee shall not be
         liable for any error of judgment made in good faith by a Responsible
         Officer of the Capital Securities Guarantee Trustee, unless it shall be
         proved that the Capital Securities Guarantee Trustee was negligent in
         ascertaining the pertinent facts upon which such judgment was made;

                  (iii) the Capital Securities Guarantee Trustee shall not be
         liable with respect to any action taken or omitted to be taken by it in
         good faith in accordance with the direction of the Holders of not less
         than a Majority in liquidation amount of the Capital Securities
         relating to the time, method and place of conducting any proceeding for
         any remedy available to the Capital Securities Guarantee Trustee, or
         exercising any trust or power conferred upon the Capital Securities
         Guarantee Trustee under this Capital Securities Guarantee; and

                  (iv)  no provision of this Capital Securities Guarantee shall
         require the Capital Securities Guarantee Trustee to expend or risk its
         own funds or otherwise incur personal financial liability in the
         performance of any of its duties or in the exercise of any of its
         rights or powers, if the Capital Securities Guarantee Trustee shall
         have reasonable grounds for believing that the repayment of such funds
         or liability is not reasonably assured to it under the terms of this
         Capital Securities Guarantee or indemnity, reasonably satisfactory to
         the Capital Securities Guarantee Trustee, against such risk or
         liability is not reasonably assured to it.

SECTION 3.2       Certain Rights of Capital Securities Guarantee Trustee.
                  ------------------------------------------------------

                  (a)   Subject to the provisions of Section 3.1:

                  (i)   The Capital Securities Guarantee Trustee may rely
         conclusively, and shall be fully protected in acting or refraining from
         acting upon, any resolution, certificate, statement, instrument,
         opinion, report, notice, request, direction, consent, order, bond,
         debenture, note, other evidence of indebtedness or other paper or
         document believed by it to be genuine and to have been signed, sent or
         presented by the proper party or parties.

                  (ii)  Any direction or act of the Guarantor contemplated by
         this Capital Securities Guarantee shall be sufficiently evidenced by an
         Officers' Certificate.

                  (iii) Whenever, in the administration of this Capital
         Securities Guarantee, the Capital Securities Guarantee Trustee shall
         deem it desirable that a matter be proved or established before taking,
         suffering or omitting any action hereunder, the Capital Securities
         Guarantee Trustee (unless other evidence is herein specifically
         prescribed) may, in the absence of bad faith on its part, request and
         conclusively rely upon an Officers' Certificate which, upon receipt of
         such request, shall be promptly delivered by the Guarantor.

                  (iv)  The Capital Securities Guarantee Trustee shall have no
         duty to see to any recording, filing or registration of any instrument
         (or any rerecording, refiling or registration thereof).

                                       8

<PAGE>

                  (v)    The Capital Securities Guarantee Trustee may consult
         with counsel of its selection, and the advice or opinion of such
         counsel with respect to legal matters shall be full and complete
         authorization and protection in respect of any action taken, suffered
         or omitted by it hereunder in good faith and in accordance with such
         advice or opinion. Such counsel may be counsel to the Guarantor or any
         of its Affiliates and may include any of its employees. The Capital
         Securities Guarantee Trustee shall have the right at any time to seek
         instructions concerning the administration of this Capital Securities
         Guarantee from any court of competent jurisdiction.

                  (vi)   The Capital Securities Guarantee Trustee shall be under
         no obligation to exercise any of the rights or powers vested in it by
         this Capital Securities Guarantee at the request or direction of any
         Holder, unless such Holder shall have provided to the Capital
         Securities Guarantee Trustee such security and indemnity, reasonably
         satisfactory to the Capital Securities Guarantee Trustee, against the
         costs, expenses (including attorneys' fees and expenses and the
         expenses of the Capital Securities Guarantee Trustee's agents, nominees
         or custodians) and liabilities that might be incurred by it in
         complying with such request or direction, including such reasonable
         advances as may be requested by the Capital Securities Guarantee
         Trustee; provided that, nothing contained in this Section 3.2(a)(vi)
         shall be taken to relieve the Capital Securities Guarantee Trustee,
         upon the occurrence of an Event of Default, of its obligation to
         exercise the rights and powers vested in it by this Capital Securities
         Guarantee.

                  (vii)  The Capital Securities Guarantee Trustee shall not be
         bound to make any investigation into the facts or matters stated in any
         resolution, certificate, statement, instrument, opinion, report,
         notice, request, direction, consent, order, bond, debenture, note,
         other evidence of indebtedness or other paper or document, but the
         Capital Securities Guarantee Trustee, in its discretion, may make such
         further inquiry or investigation into such facts or matters as it may
         see fit.

                  (viii) The Capital Securities Guarantee Trustee may execute
         any of the trusts or powers hereunder or perform any duties hereunder
         either directly or by or through agents, nominees, custodians or
         attorneys, and the Capital Securities Guarantee Trustee shall not be
         responsible for any misconduct or negligence on the part of any agent
         or attorney appointed with due care by it hereunder.

                  (ix)   Any action taken by the Capital Securities Guarantee
         Trustee or its agents hereunder shall bind the Holders of the Capital
         Securities, and the signature of the Capital Securities Guarantee
         Trustee or its agents alone shall be sufficient and effective to
         perform any such action. No third party shall be required to inquire as
         to the authority of the Capital Securities Guarantee Trustee to so act
         or as to its compliance with any of the terms and provisions of this
         Capital Securities Guarantee, both of which shall be conclusively
         evidenced by the Capital Securities Guarantee Trustee's or its agent's
         taking such action.

                  (x)    Whenever in the administration of this Capital
         Securities Guarantee the Capital Securities Guarantee Trustee shall
         deem it desirable to receive instructions with respect to enforcing any
         remedy or right or taking any other action hereunder, the Capital

                                       9

<PAGE>

         Securities Guarantee Trustee (i) may request instructions from the
         Holders of a Majority in liquidation amount of the Securities, (ii) may
         refrain from enforcing such remedy or right or taking such other action
         until such instructions are received, and (iii) shall be protected in
         conclusively relying on or acting in accordance with such instructions.

                  (xi) The Capital Securities Guarantee Trustee shall not be
         liable for any action taken, suffered, or omitted to be taken by it in
         good faith and reasonably believed by it to be authorized or within the
         discretion or rights or powers conferred upon it by this Capital
         Securities Guarantee.

                  (b)  No provision of this Capital Securities Guarantee shall
be deemed to impose any duty or obligation on the Capital Securities Guarantee
Trustee to perform any act or acts or exercise any right, power, duty or
obligation conferred or imposed on it in any jurisdiction in which it shall be
illegal, or in which the Capital Securities Guarantee Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Capital Securities Guarantee
Trustee shall be construed to be a duty.

SECTION 3.3       Not Responsible for Recitals or Issuance of Capital Securities
                  --------------------------------------------------------------
Guarantee.
---------

                  The recitals contained in this Capital Securities Guarantee
shall be taken as the statements of the Guarantor, and the Capital Securities
Guarantee Trustee does not assume any responsibility for their correctness. The
Capital Securities Guarantee Trustee makes no representation as to the validity
or sufficiency of this Capital Securities Guarantee.

                                   ARTICLE 4
                      CAPITAL SECURITIES GUARANTEE TRUSTEE

SECTION 4.1       Capital Securities Guarantee Trustee; Eligibility.
                  -------------------------------------------------

                  (a)      There shall at all times be a Capital Securities
Guarantee Trustee which shall:

                  (i)      not be an Affiliate of the Guarantor; and

                  (ii)     be a corporation organized and doing business under
         the laws of the United States of America or any State or Territory
         thereof or of the District of Columbia, or a corporation or Person
         permitted by the Securities and Exchange Commission to act as a trustee
         under the Trust Indenture Act, authorized under such laws to exercise
         corporate trust powers, having a combined capital and surplus of at
         least $50,000,000, and subject to supervision or examination by
         Federal, State, Territorial or District of Columbia authority. If such
         corporation publishes reports of condition at least annually, pursuant
         to law or to the requirements of the supervising or examining authority
         referred to above, then, for the purposes of this Section 4.1(a)(ii),
         the combined capital and surplus of such corporation shall be deemed to
         be its combined capital and surplus as set forth in its most recent
         report of condition so published.

                                       10

<PAGE>

                  (b) If at any time the Capital Securities Guarantee Trustee
shall cease to be eligible to so act under Section 4.1(a), the Capital
Securities Guarantee Trustee shall immediately resign in the manner and with the
effect set out in Section 4.2(c).

                  (c) If the Capital Securities Guarantee Trustee has or shall
acquire any "conflicting interest" within the meaning of Section 310(b) of the
Trust Indenture Act, the Capital Securities Guarantee Trustee and Guarantor
shall in all respects comply with the provisions of Section 310(b) of the Trust
Indenture Act.

SECTION 4.2       Appointment, Removal and Resignation of Capital Securities
                  -----------------------------------------------------------
Guarantee Trustee.
-----------------

                  (a) Subject to Section 4.2(b), the Capital Securities
Guarantee Trustee may be appointed or removed without cause at any time by the
Guarantor except during an Event of Default.

                  (b) The Capital Securities Guarantee Trustee shall not be
removed in accordance with Section 4.2(a) until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such appointment by
written instrument executed by such Successor Capital Securities Guarantee
Trustee and delivered to the Guarantor.

                  (c) The Capital Securities Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an instrument in
writing executed by the Capital Securities Guarantee Trustee and delivered to
the Guarantor, which resignation shall not take effect until a Successor Capital
Securities Guarantee Trustee has been appointed and has accepted such
appointment by instrument in writing executed by such Successor Capital
Securities Guarantee Trustee and delivered to the Guarantor and the resigning
Capital Securities Guarantee Trustee.

                  (d) If no Successor Capital Securities Guarantee Trustee shall
have been appointed and accepted appointment as provided in this Section 4.2
within 60 days after delivery of an instrument of removal or resignation, the
Capital Securities Guarantee Trustee resigning or being removed may petition any
court of competent jurisdiction for appointment of a Successor Capital
Securities Guarantee Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper, appoint a Successor Capital Securities
Guarantee Trustee.

                  (e) No Capital Securities Guarantee Trustee shall be liable
for the acts or omissions to act of any Successor Capital Securities Guarantee
Trustee.

                  (f) Upon termination of this Capital Securities Guarantee or
removal or resignation of the Capital Securities Guarantee Trustee pursuant to
this Section 4.2, the Guarantor shall pay to the Capital Securities Guarantee
Trustee all amounts accrued to the date of such termination, removal or
resignation.

                                       11

<PAGE>

                                    ARTICLE 5
                                    GUARANTEE

SECTION 5.1       Guarantee.
                  ---------

                  The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim that the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.

SECTION 5.2       Waiver of Notice and Demand.
                  ---------------------------

                  The Guarantor hereby waives notice of acceptance of this
Capital Securities Guarantee and of any liability to which it applies or may
apply, presentment, demand for payment, any right to require a proceeding first
against the Issuer or any other Person before proceeding against the Guarantor,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.

SECTION 5.3       Obligations Not Affected.
                  ------------------------

                  The obligations, covenants, agreements and duties of the
Guarantor under this Capital Securities Guarantee shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:

                  (a) the release or waiver, by operation of law or otherwise,
of the performance or observance by the Issuer of any express or implied
agreement, covenant, term or condition relating to the Capital Securities to be
performed or observed by the Issuer;

                  (b) the extension of time for the payment by the Issuer of all
or any portion of the Distributions, Redemption Price, Liquidation Distribution
or any other sums payable under the terms of the Capital Securities or the
extension of time for the performance of any other obligation under, arising out
of, or in connection with, the Capital Securities (other than an extension of
time for payment of Distributions, Redemption Price, Liquidation Distribution or
other sum payable that results from the extension of any interest payment period
on the Notes or any extension of the maturity date of the Notes permitted by the
Indenture);

                  (c) any failure, omission, delay or lack of diligence on the
part of the Holders to enforce, assert or exercise any right, privilege, power
or remedy conferred on the Holders pursuant to the terms of the Capital
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;

                  (d) the voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy, assignment for the
benefit of creditors, reorganization, arrangement, composition or readjustment
of debt of, or other similar proceedings affecting, the Issuer or any of the
assets of the Issuer;

                                       12

<PAGE>

               (e) any invalidity of, or defect or deficiency in, the Capital
Securities;

               (f) any failure or omission to receive any regulatory approval or
consent required in connection with the Common Securities or Capital Securities,
including the failure to receive any approval of the Board of Governors of the
Federal Reserve System required in connection with the Capital Securities;

               (g) the settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or

               (h) any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it being
the intent of this Section 5.3 that the obligations of the Guarantor hereunder
shall be absolute and unconditional under any and all circumstances.

               There shall be no obligation of the Holders to give notice to, or
obtain consent of, the Guarantor with respect to the happening of any of the
foregoing.

SECTION 5.4    Rights of Holders.
               -----------------

               (a) The Holders of a Majority in liquidation amount of the
Capital Securities have the right to direct the time, method and place of
conducting of any proceeding for any remedy available to the Capital Securities
Guarantee Trustee in respect of this Capital Securities Guarantee or exercising
any trust or power conferred upon the Capital Securities Guarantee Trustee under
this Capital Securities Guarantee.

               (b) If the Capital Securities Guarantee Trustee fails to enforce
such Capital Securities Guarantee, any Holder of Capital Securities may
institute a legal proceeding directly against the Guarantor to enforce the
Capital Securities Guarantee Trustee's rights under this Capital Securities
Guarantee, without first instituting a legal proceeding against the Issuer, the
Capital Securities Guarantee Trustee or any other person or entity. The
Guarantor waives any right or remedy to require that any action be brought first
against the Issuer or any other person or entity before proceeding directly
against the Guarantor.

SECTION 5.5    Guarantee of Payment.
               --------------------

               This Capital Securities Guarantee creates a guarantee of payment
and not of collection.

SECTION 5.6    Subrogation.
               -----------

               The Guarantor shall be subrogated to all (if any) rights of the
Holders of Capital Securities against the Issuer in respect of any amounts paid
to such Holders by the Guarantor under this Capital Securities Guarantee;
provided, however, that the Guarantor shall not (except to the extent required
by mandatory provisions of law) be entitled to enforce or exercise any right
that it may acquire by way of subrogation or any indemnity, reimbursement or
other agreement, in all cases as a result of payment under this Capital
Securities Guarantee, if, at the time of any such payment, any amounts are due
and unpaid under this Capital Securities Guarantee. If any

                                       13

<PAGE>

amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.

SECTION 5.7    Independent Obligations.
               -----------------------

               The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Issuer with respect to the Capital
Securities, and that the Guarantor shall be liable as principal and as debtor
hereunder to make Guarantee Payments pursuant to the terms of this Capital
Securities Guarantee notwithstanding the occurrence of any event referred to in
subsections (a) through (h), inclusive, of Section 5.3 hereof.

                                    ARTICLE 6
                    LIMITATION OF TRANSACTIONS; SUBORDINATION

SECTION 6.1    Limitation of Transactions.
               --------------------------

               So long as any Capital Securities remain outstanding, if there
shall have occurred and be continuing an Event of Default under this Capital
Securities Guarantee, an Event of Default or a Nonpayment under the Declaration
or during an Extended Interest Payment Period (as defined in the Indenture),
then (a) the Guarantor shall not declare or pay any dividend on, make any
distributions with respect to, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of its capital stock (other than (i)
purchases or acquisitions of shares of its common stock in connection with the
satisfaction by the Guarantor of its obligations under any employee benefit
plans, (ii) as a result of a reclassification of the Guarantor's capital stock
or the exchange or conversion of one class or series of the Guarantor's capital
stock for another class or series of the Guarantor's capital stock, or (iii) the
purchase of fractional interests in shares of the Guarantor's capital stock
pursuant to an acquisition or the conversion or exchange provisions of such
capital stock of the Guarantor or the security being converted or exchanged) or
make any guarantee payments with respect to the foregoing or (b) the Guarantor
shall not make any payment of interest, principal or premium, if any, on or
repay, repurchase or redeem any debt securities (including guarantees) issued by
the Guarantor which rank pari passu with or junior to the Notes.

SECTION 6.2    Ranking.
               -------

               This Capital Securities Guarantee will constitute an unsecured
obligation of the Guarantor and will rank (i) subordinate and junior in right of
payment to all other liabilities, including contingent liabilities, of the
Guarantor, (ii) pari passu with the most senior preferred or preference stock
now or hereafter issued by the Guarantor and with any guarantee now or hereafter
entered into by the Guarantor in respect of any preferred securities (including
trust preferred securities) or preference stock of any Affiliate of the
Guarantor, and (iii) senior to the Guarantor's common stock.

                                       14

<PAGE>

                                    ARTICLE 7
                                   TERMINATION

SECTION 7.1   Termination.
              -----------

              This Capital Securities Guarantee shall terminate upon (i) full
payment of the Redemption Price of all Capital Securities, (ii) upon the
distribution of the Notes to the Holders of all of the Capital Securities, or
(iii) upon full payment of the amounts payable in accordance with the
Declaration upon liquidation or dissolution of the Issuer. Notwithstanding the
foregoing, this Capital Securities Guarantee will continue to be effective or
will be reinstated, as the case may be, if at any time any Holder of Capital
Securities must restore payment of any sums paid under the Capital Securities or
under this Capital Securities Guarantee.

                                    ARTICLE 8
                                 INDEMNIFICATION

SECTION 8.1   Exculpation.
              -----------

     (a)      No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Guarantor or any Covered Person for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Indemnified Person in good faith in accordance with this Capital
Securities Guarantee and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on such Indemnified
Person by this Capital Securities Guarantee or by law, except that an
Indemnified Person shall be liable for any such loss, damage or claim incurred
by reason of such Indemnified Person's negligence or willful misconduct with
respect to such acts or omissions.

     (b)      An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Guarantor and upon such information, opinions,
reports or statements presented to the Guarantor by any Person as to matters the
Indemnified Person reasonably believes are within such other Person's
professional or expert competence and who has been selected with reasonable care
by or on behalf of the Guarantor, including information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses, or any other facts pertinent to the existence and amount of assets from
which Distributions to Holders of Capital Securities might properly be paid.

SECTION 8.2   Indemnification.
              ---------------

              The Guarantor agrees to indemnify each Indemnified Person for, and
to hold each Indemnified Person harmless against, any and all loss, liability,
damage, claim or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 8.2 shall survive the termination of this
Capital Securities Guarantee.

                                       15

<PAGE>

                                    ARTICLE 9
                                  MISCELLANEOUS

SECTION 9.1   Successors and Assigns.
              ----------------------

              All guarantees and agreements contained in this Capital Securities
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders
of the Capital Securities then outstanding.

SECTION 9.2   Amendments.
              ----------

              Except with respect to any changes that do not adversely affect
the rights of Holders (in which case no consent of Holders will be required),
this Capital Securities Guarantee may only be amended with the prior approval of
the Holders of at least a Majority in liquidation amount (including the stated
amount that would be paid on redemption, liquidation or otherwise, plus accrued
and unpaid Distributions to the date upon which the voting percentages are
determined) of all the outstanding Capital Securities. The provisions of Section
12.2 of the Declaration with respect to meetings of Holders of the Securities
apply to the giving of such approval.

SECTION 9.3   Notices.
              -------

              All notices provided for in this Capital Securities Guarantee
shall be in writing, duly signed by the party giving such notice, and shall be
delivered, telecopied or mailed by first class mail, as follows:

       (a)    If given to the Capital Securities Guarantee Trustee, at the
Capital Securities Guarantee Trustee's mailing address set forth below (or such
other address as the Capital Securities Guarantee Trustee may give notice of to
the Holders of the Capital Securities):

                    The Bank of New York
                    101 Barclay Street, 21 West
                    New York, New York 10286
                    Attention: Corporate Trust Trustee Administration
                    Telecopy:  (212)815-5915

         (b) If given to the Guarantor, at the Guarantor's mailing address set
forth below (or such other address as the Guarantor may give notice of to the
Holders of the Capital Securities):

                    Bank of America Corporation
                    Bank of America Corporate Center
                    100 North Tryon Street
                    NC1-007-23-01
                    Charlotte, North Carolina 28255
                    Attention: Corporate Treasury
                    Telecopy:  (704) 386-0270

                                       16

<PAGE>

        (c)    If given to any Holder of Capital Securities, at the address set
forth on the books and records of the Issuer.

               All such notices shall be deemed to have been given when received
in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid except that if a notice or other document is refused delivery or
cannot be delivered because of a changed address of which no notice was given,
such notice or other document shall be deemed to have been delivered on the date
of such refusal or inability to deliver.

SECTION 9.4    Benefit.
               -------

               This Capital Securities Guarantee is solely for the benefit of
the Holders of the Capital Securities and, subject to Section 3.1(a), is not
separately transferable from the Capital Securities.

SECTION 9.5    Governing Law.
               ------------

               THIS CAPITAL SECURITIES GUARANTEE SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.

                                       17

<PAGE>

     THIS CAPITAL SECURITIES GUARANTEE is executed as of the day and year first
above written.

                              BANK OF AMERICA CORPORATION, as Guarantor

                              By: ________________________________________
                                  Name:  Karen A. Gosnell
                                  Title: Senior Vice President

                              THE BANK OF NEW YORK, as Capital Securities
                              Guarantee Trustee

                              By: ________________________________________
                                  Name:
                                  Title:

                                       18EXHIBIT 4.1.1

                   AMENDED AND RESTATED LIMITED LIABILITY
                  COMPANY AGREEMENT OF CONSUMERS FUNDING LLC

<TABLE>
<CAPTION>

                                                 TABLE OF CONTENTS
                                                                                                                Page
                                                      ARTICLE I
<S>                                                                                                             <C>

                                                     Definitions...................................................1

         SECTION 1.01  Capitalized Terms...........................................................................1
         SECTION 1.02  Other Definitional Provisions...............................................................7

                                                     ARTICLE II
                                     Formation of the Limited Liability Company....................................8

         SECTION 2.01  Formation; Filings..........................................................................8
         SECTION 2.02  Name and Office.............................................................................8
         SECTION 2.03  Business Purpose............................................................................8
         SECTION 2.04  Term........................................................................................9
         SECTION 2.05  No State Law Partnership...................................................................10
         SECTION 2.06  Authority of Member........................................................................10
         SECTION 2.07  Liability to Third Parties.................................................................10
         SECTION 2.08  No Personal Liability of any Member, Special Member, Manager, Etc..........................10
         SECTION 2.09  Separateness...............................................................................11
         SECTION 2.10  Limited Liability and Bankruptcy Remoteness................................................12

                                                     ARTICLE III

                                                     Management...................................................12

         SECTION 3.01  Management by Managers.....................................................................12
         SECTION 3.02  Acts by Managers...........................................................................13
         SECTION 3.03  Number and Qualifications..................................................................13
         SECTION 3.04  Independent Managers.......................................................................13
         SECTION 3.05  Appointment and Vacancy....................................................................14
         SECTION 3.06  Term.......................................................................................14
         SECTION 3.07  Removal....................................................................................15
         SECTION 3.08  Resignation................................................................................15
         SECTION 3.09  Place of Meetings of Managers..............................................................15
         SECTION 3.10  Meetings of Managers.......................................................................15
         SECTION 3.11  Quorum; Majority Vote......................................................................15
         SECTION 3.12  Methods of Voting; Proxies.................................................................16
         SECTION 3.13  Actions Without a Meeting..................................................................16
         SECTION 3.14  Telephone and Similar Meetings.............................................................16
         SECTION 3.15  Managers...................................................................................16

                                                     ARTICLE IV

                                                      Officers....................................................16

         SECTION 4.01  Designation; Term; Qualifications..........................................................16
         SECTION 4.02  Removal and Resignation....................................................................17
         SECTION 4.03  Vacancies..................................................................................17
         SECTION 4.04  Compensation...............................................................................17

                                                      ARTICLE V

                                                       Member.....................................................17

         SECTION 5.01  Powers.....................................................................................17
         SECTION 5.02  Compensation of Member.....................................................................18
         SECTION 5.03  Actions by the Member......................................................................18
         SECTION 5.04  Control by Member..........................................................................18
         SECTION 5.05  Special Member.............................................................................18

                                                     ARTICLE VI

                                                   Common Interest................................................19

         SECTION 6.01  General....................................................................................19
         SECTION 6.02  Distributions..............................................................................19
         SECTION 6.03  Rights on Liquidation, Dissolution or Winding Up...........................................20
         SECTION 6.04  Redemption.................................................................................20
         SECTION 6.05  Voting Rights..............................................................................21

                                                     ARTICLE VII

                                        Allocations; Distributions; Expenses;
                                      Taxes; Books; Records; and Bank Accounts....................................21

         SECTION 7.01  Allocations................................................................................21
         SECTION 7.02  Distributions..............................................................................21
         SECTION 7.03  Limitation Upon Distributions..............................................................21
         SECTION 7.04  Expenses...................................................................................21
         SECTION 7.05  Tax Elections..............................................................................22
         SECTION 7.06  Annual Tax Information.....................................................................22
         SECTION 7.07  Tax Matters Member.........................................................................23
         SECTION 7.08  Maintenance of Books.......................................................................23
         SECTION 7.09  Reports....................................................................................23
         SECTION 7.10  Bank and Investment Accounts...............................................................23

                                                    ARTICLE VIII

                                                   Indemnification................................................23

         SECTION 8.01  Mandatory Indemnification of the Member,
             the Special Members, and the Managers................................................................23
         SECTION 8.02  Mandatory Advancement of Expenses..........................................................24
         SECTION 8.03  Indemnification of Officers, Employees and Agents..........................................24
         SECTION 8.04  Nonexclusivity of Rights...................................................................25
         SECTION 8.05  Contract Rights............................................................................25
         SECTION 8.06  Insurance..................................................................................25
         SECTION 8.07  Savings Clause.............................................................................25
         SECTION 8.08  Other Ventures.............................................................................26
         SECTION 8.09  Other Arrangements Not Excluded............................................................26

                                                     ARTICLE IX

                                              Miscellaneous Provisions............................................26

         SECTION 9.01  Offset.....................................................................................26
         SECTION 9.02  Notices....................................................................................27
         SECTION 9.03  Effect of Waiver or Consent................................................................27
         SECTION 9.04  Governing Law; Severability................................................................27
         SECTION 9.05  No Bankruptcy Petition; No Dissolution.....................................................27
         SECTION 9.06  Amendment..................................................................................28
         SECTION 9.07  Headings and Sections......................................................................29
         SECTION 9.08  Binding Agreement..........................................................................29

SCHEDULE A:  SCHEDULE OF CAPITAL CONTRIBUTIONS OF MEMBER.........................................................A-1

SCHEDULE B:  CERTIFICATE OF COMMON INTEREST......................................................................B-1

SCHEDULE C:  MANAGERS............................................................................................C-1

SCHEDULE D:  OFFICERS............................................................................................D-1

</TABLE>

                            AMENDED AND RESTATED
                    LIMITED LIABILITY COMPANY AGREEMENT
                                     OF
                           CONSUMERS FUNDING LLC,
                    a Delaware Limited Liability Company

                  AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT,
dated November 8, 2001 (the "Agreement"), of CONSUMERS FUNDING LLC, a
Delaware limited liability company (the "Company"), having its principal
office at 212 W. Michigan Avenue, Suite M-1029, Jackson, Michigan 49201.

                  WHEREAS, Consumers Energy Company ("Consumers"), as sole
Member, (i) on October 11, 2000 filed a Certificate of Formation of the
Company with the Delaware Secretary of State, (ii) amended and restated
such Certificate of Formation on November 6, 2001 and filed the same with
the Secretary of State of the State of Delaware on November 6, 2001, and
(iii) executed a Limited Liability Company Agreement, dated October 11,
2000 (the "Original LLC Agreement"); and

                  WHEREAS, this Agreement amends and restates the Original
LLC Agreement in all respects, and from and after the date hereof
constitutes the governing instrument of the Company;

                  NOW THEREFORE, the Member (as defined below) hereby
amends and restates the Original LLC Agreement as follows:

                                 ARTICLE I

                                Definitions

                  SECTION 1.01 Capitalized Terms. For all purposes of this
Agreement, the following terms shall have the meanings set forth below:

                  "Act" shall mean the Delaware Limited Liability Company
Act, as amended (currently Chapter 18 of Title 6, Sections 18-101 through
18-1109 of the Delaware Code).

                  "Administration Agreement" shall mean the Administration
Agreement, dated November 8, 2001, between the Company and Consumers, as
administrator.

                  "Affiliate" shall mean, with respect to any specified
Person, any other Person controlling or controlled by or under common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.

                  "Agreement" shall mean this Amended and Restated Limited
Liability Company Agreement of the Company.

                  "Bankruptcy" shall mean, with respect to any Person, if
such Person (i) makes an assignment for the benefit of creditors, (ii)
files a voluntary petition in bankruptcy, (iii) is adjudged a bankrupt or
insolvent, or has entered against it an order for relief, in any bankruptcy
or insolvency proceedings, (iv) files a petition or answer seeking for
itself any reorganization, arrangement, composition, readjustment,
liquidation or similar relief under any statute, law or regulation, (v)
files an answer or other pleading admitting or failing to contest the
material allegations of a petition filed against it in any proceeding of
this nature, (vi) seeks, consents to or acquiesces in the appointment of a
trustee, receiver or liquidator of the Person or of all or any substantial
part of its properties, or (vii) if one hundred and twenty (120) days after
the commencement of any proceeding against the Person seeking
reorganization, arrangement, composition, readjustment, liquidation or
similar relief under any statute, law or regulation, the proceeding has not
been dismissed, or if within ninety (90) days after the appointment without
such Person's consent or acquiescence of a trustee, receiver or liquidator
of such Person or of all or any substantial part of its properties, the
appointment is not vacated or stayed, or if within ninety (90) days after
the expiration of any such stay, the appointment is not vacated. The
foregoing definition of "Bankruptcy" is intended to replace and shall
supersede and replace the definition of "Bankruptcy" set forth in Sections
18-101(1) and 18-304 of the Act.

                  "Basic Documents" shall mean this Agreement, the
Certificate of Formation, the Indenture, the Sale Agreement, any Bill of
Sale, the Servicing Agreement, the Administration Agreement, the
Intercreditor Agreement, the Securities Account Control Agreement and the
Underwriting Agreement.

                  "Bill of Sale" shall mean the bill of sale, issued by
Consumers to the Company as of November 8, 2001, pursuant to the Sale
Agreement, together with any other bill of sale delivered in accordance
therewith.

                  "Bonds" shall have the meaning set forth in Section
2.03(a).

                  "Business Day" shall mean any day other than a Saturday,
Sunday or other day on which banks are authorized or required by law to be
closed in New York City, New York, Jackson, Michigan or, with respect to
any payments on any Bonds listed on the Luxembourg Stock Exchange, in
Luxembourg.

                  "Certificate of Formation" shall mean the Certificate of
Formation of the Company as filed in accordance with the Act with the
Secretary of State of the State of Delaware on October 11, 2000, as amended
and restated and filed with the Secretary of State of the State of Delaware
on November 6, 2001.

                  "Code" shall mean the Internal Revenue Code of 1986, as
amended (or any successor law).

                  "Common Interest" shall mean the limited liability
company interest of the Member in the Company as described in Article VI.
The Company shall have one class of Common Interest.

                  "Company" shall mean Consumers Funding LLC, a Delaware
limited liability company.

                  "Consumers" shall mean Consumers Energy Company, a
Michigan corporation.

                  "Customer Choice Act" shall mean the Customer Choice and
Electricity Reliability Act 2000 PA 141 and 2000 PA 142.

                  "Financing Order" shall mean the Opinion and Order issued
on October 24, 2000 and the Order Granting Rehearing issued on January 12,
2001 by the MPSC with respect to Consumers.

                  "Fiscal Year" shall mean, unless the Managers shall at
any time determine otherwise pursuant to the requirements of the Code, a
calendar year.

                  "GAAP" shall mean the generally accepted accounting
principles promulgated or adopted by the Financial Accounting Standards
Board and its successors from time to time.

                  "Governmental Authority" shall mean any federal, state,
local or foreign court or governmental department, commission, board,
bureau, agency, authority, instrumentality or regulatory body.

                  "Indenture" shall mean the Indenture, dated as of
November 8, 2001, between the Company and the Trustee, including any
Supplement thereto creating a new Series of Bonds.

                  "Independent Manager" shall mean, with respect to the
Company, a Manager who is not, and within the previous five years was not
(except solely by virtue of such Person's serving as, or being an Affiliate
of any other Person serving as, an independent director or manager, as
applicable, of Consumers or any bankruptcy-remote special purpose entity
that is an Affiliate of Consumers or the Company), (i) a stockholder,
member, partner, director, officer, employee, Affiliate, customer,
supplier, creditor or independent contractor of, or any Person that has
received any benefit in any form whatever from (other than in such
Manager's capacity as a ratepayer or customer of Consumers in the ordinary
course of business), or any Person that has provided any service in any
form whatsoever to, or any major creditor (or any Affiliate of any major
creditor) of, the Company, Consumers, or any of their Affiliates, or (ii)
any Person owning beneficially, directly or indirectly, any outstanding
shares of common stock, any limited liability company interests or any
partnership interests, as applicable, of the Company, Consumers or any of
their Affiliates, or of any major creditor (or any Affiliate of any major
creditor) of any of the foregoing, or a stockholder, member, partner,
director, officer, employee, Affiliate, customer, supplier, creditor or
independent contractor of, or any Person that has received any benefit in
any form whatever from (other than in such Person's capacity as a ratepayer
or customer of Consumers in the ordinary course of business), or any Person
that has provided any service in any form whatever to, such beneficial
owner or any of such beneficial owner's Affiliates, or (iii) a member of
the immediate family of any person described above; provided that the
indirect or beneficial ownership of stock through a mutual fund or similar
diversified investment vehicle with respect to which the owner does not
have discretion or control over the investments held by such diversified
investment vehicle shall not preclude such owner from being an Independent
Manager. For purposes of this definition, "major creditor" shall mean a
natural person or business entity to which the Company, Consumers or any of
their Affiliates has outstanding indebtedness for borrowed money or credit
on open account in a sum sufficiently large as would reasonably be expected
to influence the judgment of the proposed Independent Manager adversely to
the interests of the Company when the interests of that Person are adverse
to those of the Company.

                  "Intercreditor Agreement" shall mean: (i) the
Intercreditor Agreement dated as of November 8, 2001 (the "Initial
Intercreditor Agreement"), among Consumers, the Trustee, the Issuer,
Canadian Imperial Bank of Commerce and Asset Securitization Cooperative
Corporation, as amended and supplemented from time to time; or (ii) any
subsequent intercreditor agreement entered into by the Trustee pursuant to
Section 18(b) of the Initial Intercreditor Agreement.

                  "Manager" shall mean any manager of the Company,
including any Independent Manager.

                  "Member" shall mean Consumers, in its capacity as a
member in the Company under this Agreement, or any successor thereto as a
member pursuant to Article VI; provided, however, the term "Member" shall
not include the Special Members.

                  "MPSC" shall mean the Michigan Public Service Commission.

                  "Person" shall mean any natural person, corporation,
business trust, joint venture, association, company, partnership, limited
liability company, joint stock company, corporation, trust, unincorporated
organization or Governmental Authority.

                  "Proceeding" shall have the meaning set forth in Section
8.01(a).

                  "Sale Agreement" shall mean the Sale Agreement, dated as
of November 8, 2001, between Consumers, as seller, and the Company.

                  "Securities Account Control Agreement" shall mean the
securities account control agreement dated as of November 8, 2001, by and
between Consumers Funding LLC, as debtor, the Trustee, as the secured
party, and The Bank of New York, in its capacity as securities intermediary
thereunder.

                  "Securities Act" shall mean the Securities Act of 1933,
as amended, and the rules and regulations of the United States Securities
and Exchange Commission promulgated thereunder.

                  "Securitization Property" shall have the meaning assigned
to that term in the Customer Choice Act and the Financing Order.

                  "Series" shall mean each series of Bonds issued and
authenticated pursuant to the Indenture and a related Supplement.

                  "Servicing Agreement" shall mean the Servicing Agreement,
dated as of November 8, 2001, between the Company and Consumers, as
servicer.

                  "Special Member" shall mean, upon such person's admission
to the Company as a member of the Company pursuant to Section 5.05, a
person acting as Independent Manager, in such person's capacity as a member
of the Company. A "Special Member" shall have the rights and duties
expressly set forth in this Agreement.

                  "State" means any one of the 50 states of the United
States of America or the District of Columbia.

                  "Supplement" shall mean a supplement to the Indenture
complying (to the extent applicable) with the terms of Article 9 of the
Indenture.

                  "Treasury Regulations" shall mean regulations, including
proposed or temporary regulations, promulgated under the Code. References
herein to specific provisions of proposed or temporary regulations shall
include analogous provisions of final Treasury Regulations or other
successor Treasury Regulations.

                  "Trustee" shall mean the party named as such in the
Indenture until a successor replaces it in accordance with the applicable
provisions of the Indenture and thereafter means the successor serving
thereunder.

                  "Underwriting Agreement" shall mean the Underwriting
Agreement, dated October 31, 2001, between Consumers, the Company and
Morgan Stanley & Co. Incorporated, on behalf of itself and as
representative of the several underwriters listed therein.

                  SECTION 1.02  Other Definitional Provisions.

                  (a) Unless otherwise defined herein, all capitalized
terms herein shall have the meanings ascribed thereto in the Indenture.

                  (b) All terms in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.

                  (c) As used in this Agreement and in any certificate or
other documents made or delivered pursuant hereto or thereto, accounting
terms not defined in this Agreement or in any such certificate or other
document, and accounting terms partly defined in this Agreement or in any
such certificate or other document to the extent not defined, shall have
the respective meanings given to them under GAAP. To the extent that the
definitions of accounting terms in this Agreement or in any such
certificate or other document are inconsistent with the meanings of such
terms under GAAP, the definitions contained in this Agreement or in any
such certificate or other document shall control.

                  (d) The words "hereof", "herein", "hereunder", and words
of similar import when used in this Agreement shall refer to this Agreement
as a whole and not to any particular provision of this Agreement; Section
references contained in this Agreement are references to Sections in this
Agreement unless otherwise specified; and the term "including" shall mean
"including without limitation".

                  (e) The definitions contained in this Agreement are
applicable to the singular as well as the plural forms of such terms.

                  (f) Any agreement, instrument or statute defined or
referred to herein or in any instrument or certificate delivered in
connection herewith means such agreement, instrument or statute as from
time to time amended, modified or supplemented and includes (in the case of
agreements or instruments) references to all attachments thereto and
instruments incorporated therein; references to a Person are also to its
permitted successors and assigns.

                                 ARTICLE II

                 Formation of the Limited Liability Company

                  SECTION 2.01 Formation; Filings. Pursuant to the Act and
in accordance with the further terms and provisions hereof, the Member
hereby continues the Company as a limited liability company. The
Certificate of Formation of the Company, has been executed and filed with
the Secretary of State of the State of Delaware by an authorized person
within the meaning of the Act. The Member shall execute or cause to be
executed from time to time all other instruments, certificates, notices and
documents, and shall do or cause to be done all such filing, recording,
publishing and other acts, in each case, as may be necessary or appropriate
from time to time to comply with all applicable requirements for the
formation and/or operation and, when appropriate, termination of a limited
liability company in the State of Delaware and all other jurisdictions
where the Company shall desire to conduct its business.

                  SECTION 2.02  Name and Office.

                  (a) The name of the Company shall be "Consumers Funding
LLC." All business of the Company shall be conducted in such name and all
contracts, property and other assets of the Company shall be held in that
name and the Member shall not have any ownership interests in such
contracts, property or other assets in its individual name.

                  (b) The address of the registered office of the Company
in the State of Delaware is the Corporation Trust Center, 1209 Orange
Street in the city of Wilmington, County of New Castle, 19801. The name of
its registered agent at that address is CT Corporation.

                  (c) The Company may also have offices at such other
places both within and without the State of Delaware as the Member may from
time to time determine.

                  SECTION 2.03 Business Purpose. The nature of the business
or purpose to be conducted or promoted by the Company is to engage
exclusively in the following business and financial activities:

         (a)      to authorize, issue, sell and deliver one or more Series
                  or classes of securitization bonds ("Bonds") under the
                  Indenture and, in connection therewith, to execute and
                  deliver Supplements, including Supplements providing for
                  the issuance of additional Series of Bonds, each as
                  permitted by and in accordance with the terms of the
                  Indenture;

         (b)      to purchase and hold Securitization Property and pledge
                  the same to the Trustee pursuant to the terms and
                  conditions of the Basic Documents;

         (c)      to negotiate, authorize, execute, deliver, assume the
                  obligations under, and perform, the Basic Documents and
                  any other agreement or instrument or document relating to
                  the activities set forth in clauses (a) and (b) above,
                  including but not limited to agreements with third-party
                  credit enhancers and [additional] swap or hedge agreement
                  counterparties relating to any Series of Bonds; provided,
                  that each party to any agreement with the Company shall
                  covenant that it shall not, prior to the date which is
                  one year and one day after the termination of the
                  Indenture and the payment in full of any Series of the
                  Bonds and any other amounts owed under the Indenture,
                  including, without limitation, any amounts owed to
                  third-party credit enhancers, and any amounts owed under
                  any hedge or swap agreement, acquiesce, petition or
                  otherwise invoke or cause the Company to invoke the
                  process of any court or government authority for the
                  purpose of commencing or sustaining a case against the
                  Company under any federal or State bankruptcy, insolvency
                  or similar law or appointing a receiver, liquidator,
                  assignee, trustee, custodian, sequestrator or other
                  similar official of the Company or any substantial part
                  of the property of the Company; or ordering the winding
                  up or liquidation of the affairs of the Company; and
                  provided, further, that the Company shall be permitted to
                  incur additional indebtedness or other liabilities
                  payable to service providers and trade creditors in the
                  ordinary course of business in connection with the
                  foregoing activities; and

         (d)      to engage in any activity and to exercise any powers
                  permitted to limited liability companies under the laws
                  of the State of Delaware that are related or incidental
                  to the foregoing and necessary, convenient or advisable
                  to accomplish the foregoing.

The Company is not authorized to and shall not engage in any activities in
the nature of selling electricity.

                  SECTION 2.04 Term. The term of the Company shall continue
until the Company is dissolved and liquidated in accordance with the Act,
subject to Sections 6.03 and 9.05. The existence of the Company as a
separate legal entity shall continue until the cancellation of the
Certificate of Formation in accordance with the Act.

                  SECTION 2.05 No State Law Partnership. The Member and the
Special Members intend that the Company shall not be a partnership
(including, without limitation, a general partnership or a limited
partnership) or joint venture, and that neither the Member, any Special
Member nor any Manager shall be a partner or joint venturer of the Member,
any Special Member or any Manager with respect to the business of the
Company for any purposes, and this Agreement shall not be construed to
suggest otherwise.

                  SECTION 2.06 Authority of Member. Subject to Section
3.04, the Member, acting in such capacity, shall have the authority or
power to act for or on behalf of the Company, to do any act that would be
binding on the Company, or to incur any expenditures, debts, liabilities or
obligations on behalf of the Company.

                  SECTION 2.07 Liability to Third Parties. Except as
otherwise expressly provided by the Act, neither the Member, any Special
Member nor any Manager shall be liable for the debts, obligations or
liabilities of the Company (whether arising in contract, tort or
otherwise), including, without limitation, under a judgment, decree or
order of a court, by reason of being the Member or acting as a Special
Member or Manager of the Company.

                  SECTION 2.08 No Personal Liability of any Member, Special
Member, Manager, Etc. (a) Neither the Member nor any Special Member shall
be subject in such capacity to any personal liability whatsoever to any
Person in connection with the assets or the acts, obligations or affairs of
the Company, (b) the Member and each Special Member shall have the same
limitation of personal liability as is extended to stockholders of a
private corporation for profit incorporated under the General Corporation
Law of the State of Delaware, and (c) no Manager or officer of the Company
shall be subject in such capacity to any personal liability whatsoever to
any Person, other than the Company or its Member, in connection with the
assets or the affairs of the Company; and, subject to the provisions of
Article VIII, all such Persons shall look solely to the assets of the
Company for satisfaction of claims of any nature arising in connection with
the affairs of the Company; provided, that such protection from personal
liability shall apply to the fullest extent permitted by applicable law, as
the same exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the Company to
provide greater or broader indemnification rights than such law permitted
the Company to provide prior to such amendment).

                  SECTION 2.09  Separateness.

                  (a) Except as provided in the Basic Documents, the funds
and other assets of the Company shall not be commingled with those of any
other entity, and the Company shall maintain its accounts separate from the
Member and any other Person.

                  (b) The Company shall not hold itself out as being liable
for the debts of any other entity, and shall conduct its own business in
its own name.

                  (c) The Company shall not form, or cause to be formed,
any subsidiaries.

                  (d) The Company shall act solely in its limited liability
company name and through its duly authorized Member, Special Members,
Managers, officers or agents in the conduct of its business, and shall
conduct its business so as not to mislead others as to the identity of the
entity or assets with which they are concerned.

                  (e) The Company shall maintain separate records, books of
account and financial statements, and shall not commingle its records and
books of account with the records and books of account of any other entity
or the Member.

                  (f) The Managers shall hold appropriate meetings to
authorize all of its limited liability company actions, which meetings may
be held by telephone conference call. The Company shall observe all
formalities required by this Agreement.

                  (g) The Company shall at all times ensure that its
capitalization is adequate in light of its business and purpose.

                  (h) Neither the Member, any Special Member nor any
Manager shall guarantee, become liable on or hold itself out as being
liable for the debts of the Company. The Company shall not guarantee or
become obligated for the debts of the Member, any Special Member or any
Manager, any Affiliate thereof or any other Person, or otherwise hold out
its credit as being available to satisfy the obligations of the Member, any
Special Member, any Manager or any other Person, shall not pledge its
assets for the benefit of any entity other than the Trustee, shall not make
loans or advances to any Person, and shall not acquire obligations or
securities of the Member, any Special Member, any Manager or any Affiliate
thereof.

                  (i) The Company shall pay its own liabilities out of its
own funds, including fees and expenses of the Administrator pursuant to the
Administration Agreement and the Servicer pursuant to the Servicing
Agreement.

                  (j) The Company shall maintain an arm's-length
relationship with its Affiliates.

                  (k) The Company shall allocate fairly and reasonably any
overhead for office space shared with the Member, any Special Member or any
Manager.

                  (l) The Company shall use its own separate stationery,
invoices, checks and other business forms.

                  (m) The Company shall correct any known misunderstanding
regarding its separate identity.

                  Failure of the Company, the Member, any Special Member or
any Manager on behalf of the Company to comply with any of the foregoing
covenants or any of the covenants contained in this Agreement shall not
affect the status of the Company as a separate legal entity or the limited
liability of the Member, any Special Member or any Manager.

                  SECTION 2.10 Limited Liability and Bankruptcy Remoteness.
Without limiting the generality of Section 2.09, the Company shall be
operated in such a manner as the Managers deem reasonable and necessary or
appropriate to preserve (a) the limited liability of Consumers (or its
successor) as the Member in the Company and the limited liability of the
Special Members, (b) the separateness of the Company from the business of
Consumers (or its successor), as the Member of the Company, or any other
Affiliate thereof and (c) until the expiration of the period of one year
and one day specified in Section 9.05, the bankruptcy-remote status of the
Company.

                                ARTICLE III

                                 Management

                  SECTION 3.01 Management by Managers. The powers of the
Company shall be exercised by or under the authority of, and the business
and affairs of the Company shall be managed under the direction of, the
Managers.

                  SECTION 3.02 Acts by Managers.

                  (a) The Managers shall be obliged to devote only as much
of their time to the Company's business as shall be reasonably required in
light of the Company's business and objectives. A Manager shall perform his
or her duties as a Manager in good faith, in a manner he or she reasonably
believes to be in the best interests of the Company, and with such care as
an ordinarily prudent person in a like position would use under similar
circumstances.

                  (b) Every Manager is an agent of the Company for the
purpose of its business, and the act of every Manager, including the
execution in the name of the Company of any instrument for carrying on the
business of the Company, binds the Company, unless such act is in
contravention of this Agreement or unless the Manager so acting otherwise
lacks the authority to act for the Company and the person with whom he or
she is dealing has knowledge of the fact that he or she has no such
authority.

                  (c) The Managers shall have the right and authority to
take all actions which the Managers deem necessary, useful or appropriate
for the day-to-day management and conduct of the Company's business.

                  (d) The Managers may exercise all powers of the Company
and do all such lawful acts and things as are not by the Act, other
applicable law or this Agreement directed or required to be exercised or
done by the Member. All instruments, contracts, agreements and documents
providing for the acquisition or disposition of property of the Company
shall be valid and binding on the Company if executed by one or more of the
Managers. All instruments, contracts, agreements and documents of
whatsoever type executed on behalf of the Company shall be executed in the
name of the Company by one or more Managers.

                  SECTION 3.03 Number and Qualifications. The number of
Managers of the Company shall not be less than three nor more than five, as
may be determined by the Member from time to time, but no decrease in the
number of Managers shall have the effect of shortening the term of any
incumbent Manager.

                  SECTION 3.04  Independent Managers.

                  (a) The Company shall have at all times at least two
individuals who are each Independent Managers. The Independent Managers may
not delegate their duties, authorities or responsibilities hereunder. If
any Independent Manager resigns, dies or becomes incapacitated, or such
position is otherwise vacant, no action requiring the unanimous affirmative
vote of the Managers shall be taken until a successor Independent Manager
is appointed by the Member and qualifies and approves such action.

                  (b) Notwithstanding any other provision of this Agreement
and any provision of law that otherwise so empowers the Company, the
Member, any Special Member, any Manager or any other Person, the Company
shall not, and neither the Member nor any Special Member, Manager nor any
other Person on behalf of the Company shall, without the prior unanimous
consent of the Managers, including each of the Independent Managers, do any
of the following: (i) engage in any business or activity other than those
set forth in Article II; (ii) except as provided in the Basic Documents,
incur any indebtedness, other than the Bonds, obligations under agreements
with third party credit enhancers and hedge or swap agreement
counterparties relating to any Series of Bonds and ordinary course expenses
as set forth in Article II, or assume or guarantee any indebtedness of any
other entity; (iii) make a general assignment for the benefit of creditors;
(iv) file a petition commencing a voluntary bankruptcy case; (v) file a
petition or answer seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any statute,
law or regulation; (vi) file an answer or other pleading admitting or
failing to contest the material allegations of a petition filed against it
in any proceeding seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any statute,
law or regulation, or the entry of any order appointing a trustee,
liquidator or receiver of it or of its assets or any substantial portion
thereof; (vii) seek, consent to or acquiesce in the appointment of a
trustee, receiver or liquidator of it or of all or any substantial part of
its assets; (viii) consolidate or merge with or into any other entity or
convey or transfer substantially all of its properties and assets
substantially as an entirety to any entity, or (ix) amend this Agreement or
take action in furtherance of any such action. With regard to any action
contemplated by the preceding sentence, or with regard to any action taken
or determination made at any time when the Company is insolvent, each
Manager will, to the fullest extent permitted by law, owe its primary
fiduciary duty to the Company (including the creditors of the Company).

                  SECTION 3.05 Appointment and Vacancy. The Member will
appoint each Manager, including any Manager to be appointed by reason of an
increase in the number of Managers.

                  SECTION 3.06 Term. Each Manager shall hold office until
his or her successor shall be selected by the Member and qualified, or
until his or her earlier death, resignation or removal as provided in this
Agreement.

                  SECTION 3.07 Removal. Subject to Section 3.04(a) and
Section 3.15 of this Agreement, the Member may remove, with or without
cause, any Manager.

                  SECTION 3.08 Resignation. Any Manager may resign at any
time. Such resignation shall be made in writing and shall take effect at
the time specified therein or, if no time is specified therein, at the time
of its receipt by the remaining Managers; provided that the resignation of
an Independent Manager shall not be effective until a replacement
Independent Manager has been appointed. The acceptance of a resignation
shall not be necessary to make it effective, unless so expressly provided
in the resignation.

                  SECTION 3.09 Place of Meetings of Managers. Any meetings
of the Managers may be held either within or without the State of Delaware
at such place or places as shall be determined from time to time by
resolution of the Managers.

                  SECTION 3.10 Meetings of Managers. Meetings of the
Managers may be held when called by any Managers or Manager. The Manager or
Managers calling any meeting shall cause notice to be given of such
meeting, including therein the time, date and place of such meeting, to
each Manager at least two Business Days before such meeting. The business
to be transacted at, or the purpose of, any meeting of the Managers shall
be specified in the notice or waiver of notice of any such meeting. If
fewer than all of the Managers are present in person, by telephone or by
proxy, business transacted at any such meeting shall be confined to the
business or purposes specifically stated in the notice or waiver of notice
of such meeting.

                  SECTION 3.11 Quorum; Majority Vote. At all meetings of
the Managers, the presence in person, by telephone or by proxy of a
majority of the Managers shall be necessary and sufficient to constitute a
quorum for the transaction of business unless a greater number is required
by this Agreement or by law. The act of a majority of the Managers present
in person, by telephone or by proxy at a meeting at which a quorum is
present in person, by telephone or by proxy shall be the act of the
Managers, except as otherwise provided by law or this Agreement. If a
quorum shall not be present in person, by telephone or by proxy at any
meeting of the Managers, the Managers present in person, by telephone or by
proxy at the meeting may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be
present in person, by telephone or by proxy.

                  SECTION 3.12 Methods of Voting; Proxies. A Manager may
vote either in person, by telephone or by proxy executed in writing by the
Manager; provided that the Person designated to act as proxy for an
Independent Manager must be an Independent Manager.

                  SECTION 3.13 Actions Without a Meeting. Any action
required or permitted to be taken at a meeting of the Managers may be taken
without a meeting, without prior notice, and without a vote, if a consent
in writing, setting forth the action so taken, is signed by the Managers
having not fewer than the minimum number of votes that would be necessary
to take the action at a meeting at which all Managers entitled to vote on
the action were present and voted. Copies of any such consents shall be
filed with the minutes and permanent records of the Company.

                  SECTION 3.14 Telephone and Similar Meetings. The
Managers, or members of any committee thereof, may participate in and hold
meetings by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can
hear each other. Such participation in any such meeting shall constitute
presence in person at such meeting, except where a Person participates in
such meeting for the express purpose of objecting to the transaction of any
business on the ground that such meeting is not lawfully called or
convened.

                  SECTION 3.15 Managers. The Member and each Manager shall
take all actions necessary from time to time to ensure that at all times
the number of Managers shall be not less than three nor more than five;
provided, however, that pursuant to Section 3.04, the Company shall at all
times have at least two Independent Managers. The Managers upon the
execution of this Agreement shall be Alan M. Wright, David A. Mikelonis,
Thomas A. McNish, Dwight Jenkins (who will serve as an Independent Manager)
and Dean A. Christiansen (who will serve as an Independent Manager).

                                 ARTICLE IV

                                  Officers

                  SECTION 4.01 Designation; Term; Qualifications. The
Managers may, from time to time, designate one or more Persons to be
officers of the Company. Any officer so designated shall have such title
and authority and perform such duties as the Managers may, from time to
time, delegate to them. Each officer shall hold office for the term for
which such officer is designated and until his or her successor shall be
duly designated and shall qualify or until his or her death, resignation or
removal as provided in this Agreement. Any Person may hold any number of
offices. No officer need be a Manager, the Member, a Delaware resident, or
a United States citizen. The persons identified on Schedule D are hereby
designated the initial officers of the Company.

                  SECTION 4.02 Removal and Resignation. Any officer of the
Company may be removed as such, with or without cause, by the Managers at
any time. Any officer of the Company may resign as such at any time upon
written notice to the Company. Such resignation shall be made in writing
and shall take effect at the time specified therein or, if no time is
specified therein, at the time of its receipt by the Managers.

                  SECTION 4.03 Vacancies. Any vacancy occurring in any
office of the Company may be filled by the Managers.

                  SECTION 4.04 Compensation. The compensation, if any, of
the officers of the Company shall be fixed from time to time by the
Managers.

                                 ARTICLE V

                                   Member

                  SECTION 5.01 Powers. Subject to the provisions of this
Agreement and the Act, all powers shall be exercised by or under the
authority of, and the business and affairs of the Company shall be
controlled by, the Member pursuant to Section 5.03. Pursuant to Section
3.01, the Member has delegated such powers to the Managers. Without
prejudice to such general powers, but subject to the same limitations, it
is hereby expressly declared that the Member shall have the following
powers, subject to Section 3.04 in all cases:

                  First: To select and remove the Managers and prescribe
         such powers and duties for them as may be consistent with the Act
         and other applicable law and this Agreement.

                  Second: To conduct, manage and control the affairs and
         business of the Company, and to make such rules and regulations
         therefor consistent with the Act and other applicable law and this
         Agreement.

                  Third: To change the registered office of the Company in
         Delaware from one location to another; to fix and locate from time
         to time one or more other offices of the Company; and to designate
         any place within or without the State of Delaware for the conduct
         of the business of the Company.

                  SECTION 5.02 Compensation of Member. The Company shall
have authority to pay to the Member reasonable compensation for the
Member's services to the Company. It is understood that the compensation
paid to the Member under the provisions of this Section shall be determined
without regard to the income of the Company, shall not be deemed to
constitute distributions to the recipient of any profit, loss or capital of
the Company and shall be considered as an operating expense of the Company.

                  SECTION 5.03 Actions by the Member. All actions of the
Member may be taken by written resolution of the Member which shall be
signed on behalf of the Member by an authorized officer of the Member and
filed with the minutes and permanent records of the Company.

                  SECTION 5.04 Control by Member. To the extent the Member
takes any action with respect to the Company (including by means of its
appointment of any individual Manager or its control or employment of any
individual Manager in any other capacity), the Member, or any such Manager,
as applicable, will act in good faith in accordance with the terms of this
Agreement, and make decisions with respect to the business and daily
operations of the Company independent of, and not dictated by, in the case
of any such Manager, the Member, or in either case any Affiliate of the
foregoing, and, to the fullest extent permitted by law, any such Manager
shall bear a fiduciary duty to the Company (including its creditors) under
the circumstances set forth in Section 3.04.

                  SECTION 5.05 Special Member. Upon the occurrence of any
event that causes the Member to cease to be a member of the Company, each
person acting as an Independent Manager pursuant to Section 3.04 shall,
without any action of any Person and simultaneously with the Member ceasing
to be a member of the Company, automatically be admitted to the Company as
a special member (a "Special Member") and shall continue the Company
without dissolution. No Special Member may resign from the Company or
transfer its rights as Special Member unless (a) a successor Special Member
has been admitted to the Company as Special Member by executing a
counterpart to this Agreement, and (b) such successor has also accepted its
appointment as Independent Manager, provided, however, the Special Members
shall auto matically cease to be members of the Company upon the admission
to the Company of a substitute Member. Each Special Member shall be a
member of the Company that has no interest in the profits, losses and
capital of the Company and has no right to receive any distributions of
Company assets. Pursuant to Section 18-301 of the Act, a Special Member
shall not be required to make any capital contributions to the Company and
shall not receive a limited liability company interest in the Company. A
Special Member, in its capacity as Special Member, may not bind the
Company. Except as required by any mandatory provision of the Act, each
Special Member, in its capacity as Special Member, shall have no right to
vote on, approve or otherwise consent to any action by, or matter relating
to, the Company, including, without limitation, the merger, consolidation
or conversion of the Company. In order to implement the admission to the
Company of each Special Member pursuant to this Section 5.05, each person
acting as an Independent Manager pursuant to Section 3.04 shall execute a
counterpart to this Agreement. Prior to its admission to the Company as
Special Member, each person acting as an Independent Manager pursuant to
Section 3.04 shall not be a member of the Company.

                                 ARTICLE VI

                              Common Interest

                  SECTION 6.01 General. The Common Interest constitutes
personal property and shall be freely transferable and assignable in whole
but not in part upon registration of such transfer and assignment on the
books of the Company in accordance with the procedures established for such
purpose by the Managers of the Company. Upon registration of the transfer
and assignment of the Common Interest on the books of the Company, the
transferee/assignee shall be and become the sole Member of the Company and
shall have the rights and powers, and be subject to the restrictions and
liabilities, of the Member under this Agreement and the Act, and the
transferor/assignor shall cease to be the Member, each as of the date of
such registration. Notwithstanding the foregoing, the Common Interest may
not be transferred unless each Rating Agency (as defined in the Indenture)
then rating the Bonds of any Class or Series shall have confirmed in
writing to the Trustee and the Company that such transfer will not result
in a reduction or withdrawal of the then current rating by any such Rating
Agency of any outstanding Series of Bonds. The Common Interest of the
Member in the Company shall be evidenced by a certificate in the form set
forth in Schedule B hereto.

                  SECTION 6.02 Distributions. The Member shall be entitled
to receive, out of the assets of the Company legally available therefor,
when, as and if declared by the Managers, distributions payable in cash in
such amounts, if any, as the Managers shall declare. Notwithstanding any
provision to the contrary contained in this Agreement, the Company shall
not be required to make a distribution to the Member on account of its
interest in the Company if such distribution would violate Section 18-607
of the Act or any other applicable law or any Basic Document.

                  SECTION 6.03  Rights on Liquidation, Dissolution or
Winding Up.

                  (a) In the event of any liquidation, dissolution or
winding up of the Company, the Member shall be entitled to all remaining
assets of the Company available for distribution to the Member after
payment of all liabilities, debts and obligations of the Company to
creditors, as set forth in Section 18-804 of the Act.

                  (b) Neither the sale of all or substantially all of the
property or business of the Company, nor the merger or consolidation of the
Company into or with another Company or other entity, shall be deemed to be
a dissolution, liquidation or winding up, voluntary or involuntary, for the
purpose of this Section 6.03.

                  (c) The commencement of a bankruptcy, insolvency,
receivership or other similar proceeding by or against the Company, any
Special Member or the Member shall not result in the dissolution of the
Company or in the cessation of the interest of the Member in the Company.
The withdrawal or resignation of the Member or any Special Member or the
dissolution of the Member or any Special Member shall not, by itself,
constitute a dissolution of the Company.

                  (d) Subject to Section 5.05, upon the occurrence of any
event that causes the last remaining member of the Company to cease to be a
member of the Company, to the fullest extent permitted by law, the personal
representative of such member is hereby authorized to, and shall, within
ninety (90) days after the occurrence of the event that terminated the
continued membership of such member in the Company, agree in writing (i) to
continue the Company and (ii) to the admission of the personal
representative or its nominee or designee, as the case may be, as a
substitute member of the Company, effective as of the occurrence of the
event that terminated the continued membership of the last remaining member
of the Company in the Company.

                  (e) Notwithstanding any other provision of this
Agreement, the bankruptcy of the Member or any Special Member shall not
cause the Member or Special Member, respectively, to cease to be a member
of the Company and upon the occurrence of such an event, the business of
the Company shall continue without dissolution.

                  SECTION 6.04 Redemption. The Common Interest shall not be
redeemable.

                  SECTION 6.05 Voting Rights. The Member shall have the
sole right to vote on all matters as to which members of a limited
liability company shall be entitled to vote pursuant to the Act and other
applicable law.

                                ARTICLE VII

                   Allocations; Distributions; Expenses;
                  Taxes; Books; Records; and Bank Accounts

                  SECTION 7.01 Allocations. Except as may be required by
section 704(c) of the Code and Treasury Regulation ss.
1.704-1(b)(2)(iv)(f)(4), all items of income, gain, loss, deduction, and
credit of the Company for each Fiscal Year shall be allocated to the
Member. Any credit available for federal income tax purposes shall be
allocated to the Member in the same manner.

                  SECTION 7.02 Distributions. All distributions shall be
made to the Member from surplus funds. Except as provided in Section 7.03,
all distributions shall be made in such amounts and at such times as
determined by the Managers.

                  SECTION 7.03 Limitation Upon Distributions. No
distribution shall be declared and paid unless, after the distribution is
made, the fair value of the Company assets is in excess of all liabilities
of the Company and no default has occurred and is continuing under the
Indenture or any Series of Bonds then outstanding.

                  SECTION 7.04 Expenses. Except as otherwise provided in
this Agreement, and subject to the provisions of the Basic Documents, the
Company shall be responsible for all expenses and the allocation thereof
including without limitation:

                  (a)      all expenses incurred by the Member or its
                           Affiliates in organizing the Company;

                  (b)      all expenses related to the payment of the
                           principal of and interest on the Bonds issued by
                           the Company;

                  (c)      all expenses related to the business of the
                           Company and all routine administrative expenses
                           of the Company, including any amounts payable
                           under the Administration Agreement and the
                           Servicing Agreement, the maintenance of books
                           and records of the Company, and the preparation
                           and dispatch to the Member of checks, financial
                           reports, tax returns and notices required
                           pursuant to this Agreement;

                  (d)      all expenses incurred in connection with any
                           litigation or arbitration involving the Company
                           (including the cost of any investigation and
                           preparation) and the amount of any judgment or
                           settlement paid in connection therewith;

                  (e)      all expenses for indemnity or contribution
                           payable by the Company to any person;

                  (f)      all expenses incurred in connection with the
                           collection of amounts due to the Company from
                           any person;

                  (g)      all expenses incurred in connection with the
                           preparation of amendments to this Agreement;

                  (h)      all expenses incurred in connection with the
                           liquidation, dissolution and winding up of the
                           Company; and

                  (i)      all expenses otherwise allocated in good faith
                           to the Company by the Managers.

                  SECTION 7.05 Tax Elections. The Managers shall make the
following elections on behalf of the Company:

                  (a)      To elect the calendar year as the Company's
                           Fiscal Year;

                  (b)      To elect the accrual method of accounting;

                  (c) To elect to treat all organization and start-up costs
of the Company as deferred expenses amortizable over sixty (60) months
under Section 195 of the Code; and

                  (d) To elect with respect to such other federal, state
and local tax matters as the Managers shall agree upon from time to time.

                  SECTION 7.06 Annual Tax Information. The Managers shall
cause the Company to deliver to the Member all information necessary for
the preparation of the Member's federal or state tax returns.

                  SECTION 7.07 Tax Matters Member. The Member shall
communicate and negotiate with the Internal Revenue Service on any tax
matter on behalf of the Member and the Company.

                  SECTION 7.08 Maintenance of Books. The Company shall keep
books and records of accounts and shall keep minutes of the proceedings of
the Member, the Managers and each committee of the Managers. The Fiscal
Year shall be the accounting year of the Company.

                  SECTION 7.09 Reports. Within sixty (60) days following
the end of each Fiscal Year during the term of the Company, the Managers
shall cause to be furnished to the Member a balance sheet, an income
statement and a statement of changes in Member's capital account for, or as
of the end of, that Fiscal Year. Such financial statements shall be
prepared in accordance with the accounting method selected by the Managers
consistently applied (except as therein noted), and shall be accompanied by
an audit report from a nationally recognized accounting firm. The Managers
also may cause to be prepared or delivered such other reports as they may
deem appropriate. The Company shall bear the costs of all such financial
statements and reports.

                  SECTION 7.10 Bank and Investment Accounts. The Managers
shall establish and maintain one or more separate bank and investment
accounts and arrangements for Company funds in the Company name with such
financial institutions and firms as the Managers determine.

                                ARTICLE VIII

                              Indemnification

                  SECTION 8.01 Mandatory Indemnification of the Member, the
Special Members, and the Managers. Any Person who was or is a party or is
threatened to be made a party to, or is involved in, any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative, arbitrative or investigative (hereafter a "Proceeding"), or
any appeal in such a Proceeding or any inquiry or investigation that could
lead to such a Proceeding, by reason of the fact that such Person is or was
the Member, a Special Member or a Manager, or by reason of the fact that
the Member, such Special Member or such Manager is or was serving at the
request of the Company as a member, director, manager, officer, partner,
venturer, proprietor, trustee, employee, agent or similar functionary of
another foreign or domestic corporation, limited liability company,
partnership, joint venture, partnership, trust, sole proprietorship,
employee benefit plan or other enterprise, shall be indemnified by the
Company to the fullest extent permitted by applicable law, as the same
exists or may hereafter be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the Company to provide
greater or broader indemnification rights than such law permitted the
Company to provide prior to such amendment) against judgments, penalties
(including, without limitation, excise and similar taxes and punitive
damages), fines, settlements and reasonable expenses (including, without
limitation, attorneys' fees) actually incurred by such Person in connection
with such Proceeding. It is expressly acknowledged that the indemnification
provided in this Article VIII could involve indemnification for negligence
or under theories of strict liability. Notwithstanding anything herein to
the contrary, for so long as any Bonds are outstanding, no payment from
funds of the Company (as distinct from funds from other sources, such as
insurance) of any indemnity under this Article VIII shall be payable except
out of funds available for payment of Company expenses as provided in the
Indenture.

                  SECTION 8.02 Mandatory Advancement of Expenses. Expenses
incurred by a Person of the type entitled to be indemnified under Section
8.01 in defending any Proceeding shall be paid or reimbursed by the Company
in advance of the final disposition of the Proceeding, without any
determination as to such Person's ultimate entitlement to indemnification
under Section 8.01, upon receipt of a written affirmation by such Person of
such Person's good faith belief that such Person has met the standard of
conduct necessary for indemnification under applicable law and a written
undertaking by or on behalf of such Person to repay all amounts so advanced
if it shall ultimately be determined that such Person is not entitled to be
indemnified by the Company as authorized in Section 8.01 or otherwise. The
written undertaking shall be an unlimited general obligation of the Person
but need not be secured and shall be accepted without reference to
financial ability to make repayment.

                  SECTION 8.03 Indemnification of Officers, Employees and
Agents. The Company shall indemnify and pay and advance expenses to an
officer, employee or agent of the Company to the same extent and subject to
the same conditions under which it may indemnify and pay and advance
expenses to the Member, any Special Member or any Manager under this
Article VIII; and the Company shall indemnify and pay and advance expenses
to any Person who is or was an officer, employee or agent of the Company
and who is or was serving at the request of the Company as a member,
manager, director, officer, partner, venturer, proprietor, trustee,
employee, agent or similar functionary of another foreign or domestic
limited liability company, partnership, corporation, partnership, joint
venture, sole proprietorship, trust, employee benefit plan or other
enterprise against any liability asserted against such Person and incurred
by such Person in such a capacity or arising out of such Person's status as
such to the same extent and subject to the same conditions that the Company
may indemnify and pay and advance expenses to the Member, any Special
Member or any Manager under this Article VIII.

                  SECTION 8.04 Nonexclusivity of Rights. The
indemnification and advancement and payment of expenses provided by this
Article VIII (a) shall not be deemed exclusive of any other rights to which
the Member, a Special Member, a Manager or other Person seeking
indemnification may be entitled under any statute, agreement, decision of
the Member or disinterested Managers, or otherwise both as to action in
such Person's official capacity and as to action in another capacity while
holding such office, (b) shall continue as to any Person who has ceased to
serve in the capacity which initially entitled such Person to indemnity and
advancement and payment of expenses, and (c) shall inure to the benefit of
the heirs, executors, administrators, successors and assigns of the Member,
such Special Member, such Manager or such other Person.

                  SECTION 8.05 Contract Rights. The rights granted pursuant
to this Article VIII shall be deemed to be contract rights, and no
amendment, modification or repeal of this Article VIII shall have the
effect of limiting or denying any such rights with respect to actions taken
or Proceedings arising prior to any such amendment, modification or repeal.

                  SECTION 8.06 Insurance. The Company may purchase and
maintain insurance or other arrangement or both, at its expense, on behalf
of itself or any Person who is or was serving as the Member, a Special
Member or a Manager, officer, employee or agent of the Company, or is or
was serving at the request of the Company as a member, manager, director,
officer, partner, venturer, proprietor, trustee, employee, agent or similar
functionary of another foreign or domestic limited liability company,
partnership, corporation, partnership, joint venture, sole proprietorship,
trust, employee benefit plan or other enterprise, against any liability,
expense or loss, whether or not the Company would have the power to
indemnify such Person against such liability under the provisions of this
Article VIII.

                  SECTION 8.07 Savings Clause. If this Article VIII or any
portion of this Agreement shall be invalidated on any ground by any court
of competent jurisdiction, then the Company shall nevertheless indemnify
and hold harmless the Member, each Special Member, each Manager or any
other Person indemnified pursuant to this Article VIII as to costs, charges
and expenses (including, without limitation, attorneys' fees), judgments,
fines and amounts paid in settlement with respect to any action, suit or
proceeding, whether civil, criminal, administrative or investigative, to
the fullest extent permitted by any applicable portion of this Article VIII
that shall not have been invalidated and to the fullest extent permitted by
applicable law.

                  SECTION 8.08 Other Ventures. It is expressly agreed that
the Member, any Special Member, any Manager and any Affiliates, officers,
directors, managers, stockholders, partners or employees of the Member, any
Special Member or any Manager, may engage in other business ventures of
every nature and description, whether or not in competition with the
Company, independently or with others, and the Company shall not have any
rights in and to any independent venture or activity or the income or
profits derived therefrom.

                  SECTION 8.09 Other Arrangements Not Excluded. The
indemnification and advancement of expenses authorized in or ordered by a
court pursuant to this Article VIII:

                  (a)      Does not exclude any other rights to which a
                           Person seeking indemnification or advancement of
                           expenses may be entitled under any agreement,
                           decision of the Member or otherwise, for either
                           an action of the Member, any Special Member or
                           any Manager, officer, employee or agent in the
                           official capacity of such Person or an action in
                           another capacity while holding such position,
                           except that indemnification, unless ordered by a
                           court, may not be made to or on behalf of the
                           Member, any Special Member or any Manager if a
                           final adjudication established that its acts or
                           omissions involved intentional misconduct, fraud
                           or a knowing violation of the law and was
                           material to the cause of action; and

                  (b)      Continues for a person who has ceased to be the
                           Member, a Special Member or a Manager, officer,
                           employee or agent and inures to the benefit of
                           the successors, heirs, executors and
                           administrators of such a person.

                                 ARTICLE IX

                          Miscellaneous Provisions

                  SECTION 9.01 Offset. Whenever the Company is to pay any
sum to the Member, any amounts the Member owes the Company may be deducted
from such sum before payment.

                  SECTION 9.02 Notices. Except as expressly set forth to
the contrary in this Agreement, all notices, requests, or consents provided
for or permitted to be given under this Agreement shall be in writing and
shall be given either by depositing such writing in the United States mail,
addressed to the recipient, postage paid, and registered or certified with
return receipt requested or by delivering such writing to the recipient in
person, by reputable overnight courier, or by facsimile transmission; and a
notice, request or consent given under this Agreement shall be effective on
receipt by the Person to whom sent. All notices, requests, and consents to
be sent to the Member shall be sent to or made to 212 W. Michigan Avenue,
Jackson, Michigan 49201, Attention: Treasurer or such other address as the
Member may specify by notice to the Company and the Managers. Any notice,
request, or consent to the Company or the Managers must be given to the
Managers at the following address: 212 W. Michigan Avenue, Suite M-1029,
Jackson, Michigan 49201, Attention: Managers. Whenever any notice is
required to be given by law or this Agreement, a written waiver thereof,
signed by the Person entitled to notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.

                  SECTION 9.03 Effect of Waiver or Consent. A waiver or
consent, express or implied, to or of any breach or default by any Person
in the performance by such Person of its obligations with respect to the
Company shall not be a consent or waiver to or of any other breach or
default in the performance by such Person of the same or any other
obligations of such Person with respect to the Company.

                  SECTION 9.04 Governing Law; Severability. THIS AGREEMENT
SHALL BE GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAW OF
THE STATE OF DELAWARE, EXCLUDING ANY CONFLICT-OF-LAWS RULE OR PRINCIPLE
THAT MIGHT REFER THE GOVERNANCE OR THE CONSTRUCTION OF THIS AGREEMENT TO
THE LAW OF ANOTHER JURISDICTION. In the event of a direct conflict between
the provisions of this Agreement and any mandatory provision of the Act,
then the applicable provision of the Act shall control. If any provision of
this Agreement or the application thereof to any Person or circumstance is
held invalid or unenforceable to any extent, the remainder of this
Agreement and the application of that provision to other Persons or
circumstances shall not be affected thereby and such provision shall be
enforced to the fullest extent permitted by law.

                  SECTION 9.05 No Bankruptcy Petition; No Dissolution. (a)
The Member, each Special Member and each Manager hereby covenants and
agrees (or shall be deemed to have hereby covenanted and agreed) that,
prior to the date which is one year and one day after the termination of
the Indenture and the payment in full of any Series of the Bonds, any other
amounts owed under the Indenture, including, without limitation, any
amounts owed to third-party credit enhancers, and any amounts owed under
any hedge or swap agreement, the Member, such Special Member and such
Manager will not acquiesce, petition or otherwise invoke or cause the
Company to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against the Company under any
federal or State bankruptcy, insolvency or similar law or appointing a
receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of the Company or any substantial part of the property of
the Company, or ordering the winding up or liquidation of the affairs of
the Company; provided, however, that nothing in this Section 9.05 shall
constitute a waiver of any right to indemnification, reimbursement or other
payment from the Company pursuant to this Agreement.

                  (b) To the fullest extent permitted by law, the Member,
each Special Member and each Manager hereby covenants and agrees (or shall
be deemed to have hereby covenanted and agreed) that, until the termination
of the Indenture and the payment in full of any Series of the Bonds, any
other amounts owed under the Indenture, including without limitation, any
amounts owed to third-party credit enhancers, and any amounts owed under
any hedge or swap agreement, the Member, such Special Member and such
Manager will not consent to, or make application for, or institute or
maintain any action for, the dissolution of the Company under Section
18-801 or 18-802 of the Act or otherwise.

                  (c) In the event that the Member, any Special Member or
any Manager takes action in violation of this Section 9.05, the Company
agrees that it will file an answer with the court or otherwise properly
contest the taking of such action and raise the defense that the Member,
the Special Member or the Manager, as the case may be, has agreed in
writing not to take such action and should be estopped and precluded
therefrom and such other defenses, if any, as its counsel advises that it
may assert.

                  (d) The provisions of this Section 9.05 shall survive the
termination of this Agreement and the resignation, withdrawal or removal of
the Member, any Special Member or any Manager. Nothing herein contained
shall preclude participation by the Member, any Special Member or a Manager
in assertion or defense of its claims in any such proceeding involving the
Company.

                  SECTION 9.06 Amendment. This Agreement may not be
amended, except in writing by the Member and the Company, upon prior
approval of the Trustee and with prior notice to the Rating Agencies (as
defined in the Indenture) and notification from each of Fitch, Inc. and
Standard & Poor's Ratings Group, a division of The McGraw-Hill Companies,
to the Company, that such amendment will not result in a reduction or
withdrawal of the then current rating by such Rating Agency of any
outstanding series or class of Bonds.

                  SECTION 9.07 Headings and Sections. The headings in this
Agreement are inserted for convenience only and are in no way intended to
describe, interpret, define, or limit the scope, extent or intent of this
Agreement or any provision hereof.

                  SECTION 9.08 Binding Agreement. Notwithstanding any other
provision of this Agreement, the Member agrees that this Agreement
constitutes a legal, valid and binding agreement of the Member, and is
enforceable against the Member by the Independent Mangers, in accordance
with its terms. In addition, the Independent Managers shall be intended
beneficiaries of this Agreement.

                  IN WITNESS WHEREOF, this Agreement is hereby executed by
the undersigned as of November 8, 2001.

                   MEMBER:

                             CONSUMERS ENERGY COMPANY

                             By: /s/ Laura L. Mountcastle
                                 ---------------------------------------
                                 Name: Laura L. Mountcastle
                                 Title:  Vice President and Treasurer

                   COMPANY:

                             CONSUMERS FUNDING LLC

                             By: /s/ Laura L. Mountcastle
                                 ---------------------------------------
                                 Name: Laura L. Mountcastle
                                 Title:  President, Chief Executive Officer,
                                          Chief Financial Officer and Treasurer

                                                   Agreed and Consented to by
                                                   the Independent Mangers:

                                                    /s/ Dean A. Christiansen
                                                   ----------------------------

                                                    /s/ Dwight Jenkins
                                                   ----------------------------

<TABLE>
<CAPTION>

                                                     SCHEDULE A

                                     SCHEDULE OF CAPITAL CONTRIBUTIONS OF MEMBER

                                                   COMMON INTEREST

                                              CAPITAL                  COMMON INTEREST                CAPITAL
MEMBER'S NAME                                CONTRIBUTION                 PERCENTAGE                  ACCOUNT
-------------                             ---------------               ------------                  -------

<S>                                          <C>                                <C>                   <C>
Consumers Energy                             $2,342,960                         100%                  $2,342,960
Company
</TABLE>

                                 SCHEDULE B

                       CERTIFICATE OF COMMON INTEREST

                                     of

                           CONSUMERS FUNDING LLC

                        A Limited Liability Company

             Organized under the Laws of the State of Delaware

         This Certificate is issued and shall be held subject to the
provisions of the Certificate of Formation of CONSUMERS FUNDING LLC, a
Limited Liability Company organized under the laws of the State of Delaware
(the "Company"), filed on October 11, 2000 with the Secretary of State of
the State of Delaware, and the Limited Liability Company Agreement dated
October 11, 2000 of the Company, as each may be amended from time to time.

         This Certificate of Common Interest certifies that Consumers
Energy Company is the registered holder of the entire Common Interest of
the Company, which Common Interest shall be transferable only on the books
of the Company by the holder hereof in person or by a duly authorized
attorney upon surrender of this Certificate with a proper endorsement.

         IN WITNESS WHEREOF, this Company has caused this Certificate to be
signed by one of its duly authorized Managers this 8th day of November,
2001.

                                                   ---------------------------
                                                   Title:  Manager

                           CONSUMERS FUNDING LLC

         For Value Received the undersigned hereby sells, assigns and
         transfers unto

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

         the entire Common Interest of the Company represented by the
         within Certificate and does hereby irrevocably constitute and
         appoint

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

         Attorney, to transfer said Common Interest on the books of the
         Company with full power of substitution in the premises.

         Dated:
                -----------------------

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

                                 SCHEDULE C

                                  MANAGERS

Names
-----
1)     Alan M. Wright

2)     David A. Mikelonis

3)     Thomas A. McNish

4)     Dean A. Christiansen

5)     Dwight Jenkins

                                 SCHEDULE D

                                  OFFICERS

Laura L. Mountcastle                 President, Chief Executive Officer, Chief
                                     Financial Officer and Treasurer
Glenn P. Barba                       Controller

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