Document:

EX-4.1

TWENTY-SEVENTH SUPPLEMENTAL INDENTURE

dated as of May 12, 2011

This Twenty-Seventh Supplemental Indenture, dated as of the 12th day of May, 2011 between CMS
Energy Corporation, a corporation duly organized and existing under the laws of the State of
Michigan (hereinafter called the “Issuer”) and having its principal office at One Energy Plaza,
Jackson, Michigan 49201, and The Bank of New York Mellon, a New York banking corporation
(hereinafter called the “Trustee”) and having its Corporate Trust Office at 101 Barclay Street, New
York, New York 10286.

WITNESSETH:

WHEREAS, the Issuer and the Trustee (ultimate successor to NBD Bank, National Association)
entered into an Indenture, dated as of September 15, 1992 (the “Original Indenture”), pursuant to
which one or more series of debt securities of the Issuer (the “Securities”) may be issued from
time to time; and

WHEREAS, Section 2.3 of the Original Indenture permits the terms of any series of Securities
to be established in an indenture supplemental to the Original Indenture; and

WHEREAS, Section 8.1(e) of the Original Indenture provides that a supplemental indenture may
be entered into by the Issuer and the Trustee without the consent of any Holders (as defined in the
Original Indenture) of the Securities to establish the form and terms of the Securities of any
series; and

WHEREAS, the Issuer has requested the Trustee to join with it in the execution and delivery of
this Twenty-Seventh Supplemental Indenture in order to supplement and amend the Original Indenture
by, among other things, establishing the form and terms of a series of Securities to be known as
the Issuer’s “2.75% Senior Notes due 2014” (the “2014 Notes”), providing for the issuance of the
2014 Notes and amending and adding certain provisions thereof for the benefit of the Holders of the
2014 Notes; and

WHEREAS, the Issuer and the Trustee desire to enter into this Twenty-Seventh Supplemental
Indenture for the purposes set forth in Section 2.3 and Section 8.1(e) of the Original Indenture as
referred to above; and

WHEREAS, the Issuer has furnished the Trustee with a copy of the resolutions of its Board of
Directors certified by its Secretary or Assistant Secretary authorizing the execution of this
Twenty-Seventh Supplemental Indenture; and

WHEREAS, all things necessary to make this Twenty-Seventh Supplemental Indenture a valid
agreement of the Issuer and the Trustee and a valid supplement to the Original Indenture have been
done;

NOW, THEREFORE, for and in consideration of the premises and the purchase of the 2014 Notes to
be issued hereunder by Holders thereof, the Issuer and the Trustee mutually covenant and agree, for
the equal and proportionate benefit of the respective Holders from time to time of the 2014 Notes,
as follows:

ARTICLE I

STANDARD PROVISIONS; DEFINITIONS

SECTION 1.01. Standard Provisions. The Original Indenture together with this Twenty-Seventh
Supplemental Indenture and all previous indentures supplemental thereto entered into pursuant to
the applicable terms thereof are hereinafter sometimes collectively referred to as the “Indenture.”
All capitalized terms which are used herein and not otherwise defined herein are defined in the
Original Indenture and are used herein with the same meanings as in the Original Indenture.

SECTION 1.02. Definitions.

(a) The following terms have the meanings set forth in the Sections hereof set forth below:

	 	 	 	 	 
	Term	 	Section
	Applicable Premium

	 	 	2.04	 
	Change of Control Date

	 	 	3.01	 
	Change of Control Purchase Notice

	 	 	3.01	(b)
	Change of Control Purchase Price

	 	 	3.01	 
	Depositary

	 	Article IX

	DTC

	 	 	2.03	 
	Events of Default

	 	 	5.01	 
	Global Note

	 	Article IX

	Indenture

	 	 	1.01; 2.04	 
	Interest Payment Date

	 	 	2.03	 
	Issuer

	 	Preamble; 2.03

	Lien

	 	 	4.02	 
	Original Indenture

	 	Recitals

	Original Issue Date

	 	 	2.03	 
	Place of Payment

	 	 	2.03	 
	Purchase Date

	 	3.01(a)(iii)

	Record Date

	 	 	2.03	 
	Required Repurchase

	 	 	3.01	 
	Securities

	 	Recitals

	Stated Maturity

	 	 	2.01(a); 2.03	 
	Treasury Rate

	 	 	2.04	 
	Trustee

	 	Preamble; 2.04

	2014 Notes

	 	Recitals; 2.04

(b) Section 1.1 of the Original Indenture is amended to insert the new definitions solely
applicable to the 2014 Notes and to replace, solely with respect to the 2014 Notes (but not with
respect to any other series of Securities), any existing definitions (as applicable) in the
Original Indenture, in the appropriate alphabetical sequence, as follows:

“Business Day” means any day on which banking institutions in New York, New York are not
authorized or required by law or regulation to close.

“Capital Lease Obligation” of a Person means any obligation that is required to be classified
and accounted for as a capital lease on the face of a balance sheet of such Person prepared in
accordance with generally accepted accounting principles; the amount of such obligation shall be
the capitalized amount thereof, determined in accordance with generally accepted accounting
principles; the stated maturity thereof shall be the date of the last payment of rent or any other
amount due under such lease prior to the first date upon which such lease may be terminated by the
lessee without payment of a penalty; and such obligation shall be deemed secured by a Lien on any
property or assets to which such lease relates.

“Capital Stock” means any and all shares, interests, rights to purchase, warrants, options,
participations or other equivalents of or interests in (however designated) corporate stock,
including any Preferred Stock or Letter Stock.

“Change of Control” means the occurrence of any of the following events: (1) any “person” or
“group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act or any successor
provisions to either of the foregoing) becomes the “beneficial owners” (as used in Rules 13d-3 and
13d-5 under the Exchange Act, except that a person or group will be deemed to have “beneficial
ownership” of all shares that any such person or group has the right to acquire, whether such right
is exercisable immediately or only after the passage of time), directly or indirectly, of a
majority of the total voting power of the Voting Stock of the Issuer, whether as a result of the
issuance of securities of the Issuer, any merger, consolidation, liquidation or dissolution of the
Issuer or otherwise; (2) the sale, transfer, assignment, lease, conveyance or other disposition,
directly or indirectly, of all or substantially all the assets of the Issuer and its subsidiaries,
considered as a whole (other than a disposition of such assets as an entirety or virtually as an
entirety to a wholly-owned subsidiary) shall have occurred, or the Issuer merges, consolidates or
amalgamates with or into any other Person or any other Person merges, consolidates or amalgamates
with or into the Issuer, in any such event pursuant to a transaction in which the outstanding
Voting Stock of the Issuer is reclassified into or exchanged for cash, securities or other
property, other than any such transaction where (a) the outstanding Voting Stock of the Issuer is
reclassified into or exchanged for other Voting Stock of the Issuer or for Voting Stock of the
surviving corporation and (b) the holders of the Voting Stock of the Issuer immediately prior to
such transaction own, directly or indirectly, a majority of the Voting Stock of the Issuer or the
surviving corporation immediately after such transaction and in substantially the same proportion
as before the transaction; (3) during any period, individuals who at the beginning of such period
constituted the board of directors of the Issuer (together with any new directors whose election or
appointment by such board of directors or whose nomination for election by the stockholders of the
Issuer was approved by a vote of a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the board of directors of
the Issuer then in office; or (4) the stockholders of the Issuer shall have approved any plan of
liquidation or dissolution of the Issuer.

“Change of Control Repurchase Event” means the occurrence of both a Change of Control and a
Rating Decline.

“Consolidated Assets” means, at any date of determination, the aggregate assets of the Issuer
and its Consolidated Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles.

“Consolidated Current Liabilities” means, for any period, the aggregate amount of liabilities
of the Issuer and its Consolidated Subsidiaries which may properly be classified as current
liabilities (including taxes accrued as estimated), after (i) eliminating all inter-company items
between the Issuer and any Consolidated Subsidiary and (ii) deducting all current maturities of
long-term Indebtedness, all as determined in accordance with generally accepted accounting
principles.

“Consolidated Net Tangible Assets” means, for any period, the total amount of assets (less
accumulated depreciation or amortization, allowances for doubtful receivables, other applicable
reserves and other properly deductible items) as set forth on the most recently available quarterly
or annual consolidated balance sheet of the Issuer and its Consolidated Subsidiaries, determined on
a consolidated basis in accordance with generally accepted accounting principles, and after giving
effect to purchase accounting and after deducting therefrom, to the extent otherwise included, the
amounts of: (i) Consolidated Current Liabilities; (ii) minority interests in Consolidated
Subsidiaries held by Persons other than the Issuer or a Restricted Subsidiary; (iii) excess of cost
over fair value of assets of businesses acquired, as determined in good faith by the Board of
Directors as evidenced by resolutions of the Board of Directors; (iv) any revaluation or other
write-up in value of assets subsequent to December 31, 1996, as a result of a change in the method
of valuation in accordance with generally accepted accounting principles; (v) unamortized debt
discount and expenses and other unamortized deferred charges, goodwill, patents, trademarks,
service marks, trade names, copyrights, licenses, organization or developmental expenses and other
intangible items; (vi) treasury stock; and (vii) any cash set apart and held in a sinking or other
analogous fund established for the purpose of redemption or other retirement of Capital Stock to
the extent such obligation is not reflected in Consolidated Current Liabilities.

“Consolidated Subsidiary” means any Subsidiary whose accounts are or are required to be
consolidated with the accounts of the Issuer in accordance with generally accepted accounting
principles.

“Consumers” means Consumers Energy Company, a Michigan corporation and wholly-owned Subsidiary
of the Issuer.

“Enterprises” means CMS Enterprises Company, a Michigan corporation and wholly-owned
Subsidiary of the Issuer.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and
any successor legislation.

“Indebtedness” of any Person means, without duplication:

(i) the principal of and premium (if any) in respect of (A) indebtedness of such Person for
money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other similar
instruments for the payment of which such Person is responsible or liable;

(ii) all Capital Lease Obligations of such Person;

(iii) all obligations of such Person issued or assumed as the deferred purchase price of
property, all conditional sale obligations and all obligations under any title retention agreement
(but excluding trade accounts payable arising in the ordinary course of business);

(iv) all obligations of such Person for the reimbursement of any obligor on any letter of
credit, bankers’ acceptance or similar credit transaction (other than obligations with respect to
letters of credit securing obligations (other than obligations described in clauses (i) through
(iii) above) entered into in the ordinary course of business of such Person to the extent such
letters of credit are not drawn upon or, if and to the extent drawn upon, such drawing is
reimbursed no later than the third Business Day following receipt by such Person of a demand for
reimbursement following payment on the letter of credit);

(v) all obligations of the type referred to in clauses (i) through (iv) above of other Persons
and all dividends of other Persons for the payment of which, in either case, such Person is
responsible or liable as obligor, guarantor or otherwise; and

(vi) all obligations of the type referred to in clauses (i) through (v) above of other Persons
secured by any Lien on any property or asset of such Person (whether or not such obligation is
assumed by such Person), the amount of such obligation being deemed to be the lesser of the value
of such property or assets or the amount of the obligation so secured.

“Investment Grade” means BBB- or higher by S&P and Baa3 or higher by Moody’s, or the
equivalent of such ratings by S&P or Moody’s or, if either S&P or Moody’s shall not make a rating
on the 2014 Notes publicly available, another Rating Agency.

“Letter Stock”, as applied to the Capital Stock of any corporation, means Capital Stock of any
class or classes (however designated) which is intended to reflect the separate performance of
certain of the businesses or operations conducted by such corporation or any of its subsidiaries.

“Moody’s” means Moody’s Investors Service, Inc.

“Paying Agent” means any Person authorized by the Issuer to pay the principal of (and premium,
if any) or interest on any of the 2014 Notes on behalf of the Issuer. Initially, the Paying Agent
shall be the Trustee.

“Person” means any individual, corporation, partnership, limited liability company, joint
venture, association, joint-stock company, trust, unincorporated organization, government or any
agency or political subdivision thereof, or any other entity.

“Predecessor 2014 Note” of any particular 2014 Note means every previous 2014 Note evidencing
all or a portion of the same debt as that evidenced by such particular 2014 Note; and, for the
purposes of the definition, any 2014 Note authenticated and delivered under Section 2.9 of the
Original Indenture in exchange for or in lieu of a mutilated, destroyed, lost or stolen 2014 Note
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen 2014 Note.

“Preferred Stock”, as applied to the Capital Stock of any corporation, means Capital Stock of
any class or classes (however designated) that is preferred as to the payment of dividends, or as
to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such corporation.

“Rating Agency” means each of S&P and Moody’s or, if S&P or Moody’s or both shall not make a
rating on the 2014 Notes publicly available, a nationally recognized statistical rating
organization or organizations, as the case may be, selected by the Issuer (as certified by a
resolution of the Issuer’s board of directors), which shall be substituted for S&P or Moody’s, or
both, as the case may be.

“Rating Decline” means the rating of the 2014 Notes shall be decreased by one or more
gradations (including gradations within categories as well as between rating categories) by each of
the Rating Agencies on any date from the date of the public notice of an arrangement that could
result in a Change of Control until the end of the 30-day period following public notice of the
occurrence of the Change of Control (which 30-day period shall be extended so long as the rating of
the 2014 Notes is under publicly announced consideration for possible downgrade by either of the
Rating Agencies; provided, that the other Rating Agency has either downgraded, or publicly
announced that it is considering downgrading, the 2014 Notes); provided, however, that if the
rating of the 2014 Notes by each of the Rating Agencies is Investment Grade, then “Rating Decline”
means the rating of the 2014 Notes shall be decreased by one or more gradations (including
gradations within categories as well as between rating categories) by each of the Rating Agencies
such that the rating of the 2014 Notes by each of the Rating Agencies falls below Investment Grade
on any date from the date of the public notice of an arrangement that could result in a Change of
Control until the end of the 30-day period following public notice of the occurrence of the Change
of Control (which 30-day period shall be extended so long as the rating of the 2014 Notes is under
publicly announced consideration for possible downgrade by either of the Rating Agencies; provided,
that the other Rating Agency has either downgraded, or publicly announced that it is considering
downgrading, the 2014 Notes).

“Restricted Subsidiary” means any Subsidiary (other than Consumers and its Subsidiaries) of
the Issuer which, as of the date of the Issuer’s most recent quarterly consolidated balance sheet,
constituted at least 10% of the total Consolidated Assets of the Issuer and its Consolidated
Subsidiaries and any other Subsidiary which from time to time is designated a Restricted Subsidiary
by the Board of Directors; provided that no Subsidiary may be designated a Restricted Subsidiary
if, immediately after giving effect thereto, an Event of Default or event that, with the lapse of
time or giving of notice or both, would constitute an Event of Default would exist, and (i) any
such Subsidiary so designated as a Restricted Subsidiary must be organized under the laws of the
United States or any State thereof, (ii) more than 80% of the Voting Stock of such Subsidiary must
be owned of record and beneficially by the Issuer or a Restricted Subsidiary and (iii) such
Restricted Subsidiary must be a Consolidated Subsidiary.

“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

“Securities Act” means the Securities Act of 1933, as amended from time to time, and any
successor legislation.

“Support Obligations” means, for any Person, without duplication, any financial obligation,
contingent or otherwise, of such Person guaranteeing or otherwise supporting any debt or other
obligation of any other Person in any manner, whether directly or indirectly, and including,
without limitation, any obligation of such Person, direct or indirect, (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such debt or to purchase (or to advance or
supply funds for the purchase of) any security for the payment of such debt, (ii) to purchase
property, securities or services for the purpose of assuring the owner of such debt of the payment
of such debt, (iii) to maintain working capital, equity capital, available cash or other financial
statement condition of the primary obligor so as to enable the primary obligor to pay such debt,
(iv) to provide equity capital under or in respect of equity subscription arrangements (to the
extent that such obligation to provide equity capital does not otherwise constitute debt), or (v)
to perform, or arrange for the performance of, any non-monetary obligations or non-funded debt
payment obligations of the primary obligor.

“Voting Stock” means securities of any class or classes the holders of which are ordinarily,
in the absence of contingencies, entitled to vote for corporate directors (or persons performing
similar functions).

ARTICLE II

DESIGNATION AND TERMS OF THE 2014 NOTES; FORMS

SECTION 2.01. Establishment of Series.

(a) There is hereby created a series of Securities to be known and designated as the “2.75%
Senior Notes due 2014” to be issued in aggregate principal amount of $250,000,000. Additional
Securities, without limitation as to amount, having substantially the same terms as the 2014 Notes
(except a different issue date, a different issue price and bearing interest from the last Interest
Payment Date to which interest has been paid or duly provided for on the 2014 Notes, and, if no
interest has been paid, from May 12, 2011), may also be issued by the Issuer pursuant to the
Indenture without the consent of the existing Holders of the 2014 Notes; provided, that such
additional Securities must be part of the same issue as the 2014 Notes for United States federal
income tax purposes. Such additional Securities shall be part of the same series as the 2014
Notes. The “Stated Maturity” of the 2014 Notes is May 15, 2014; the principal amount of the 2014
Notes shall be payable on such date unless the 2014 Notes are earlier redeemed or purchased in
accordance with the terms of the Indenture.

(b) The 2014 Notes will bear interest from the Original Issue Date, or from the most recent
date to which interest has been paid or duly provided for, at the rate of 2.75% per annum stated
therein until the principal thereof is paid or made available for payment. Interest will be
payable semi-annually on each Interest Payment Date and at Maturity, as provided in the form of the
2014 Note in Section 2.03 and Section 2.04 hereof.

(c) The Record Date referred to in Section 2.3(f)(4) of the Original Indenture for the payment
of the interest on any 2014 Note payable on any Interest Payment Date (other than on the Stated
Maturity) shall be the May 1 and November 1 next preceding the relevant Interest Payment Date
(whether or not a Business Day) except that interest payable on the Stated Maturity shall be paid
to the Person to whom the principal amount is paid.

(d) The payment of the principal of, and premium (if any) and interest on, the 2014 Notes
shall not be secured by a security interest in any property.

(e) The 2014 Notes shall be redeemable at the option of the Issuer, in whole or in part, at
any time and from time to time, upon not less than 30, nor more than 60 days’ notice at a
redemption price equal to 100% of the principal amount of such 2014 Notes being redeemed plus the
Applicable Premium, if any, thereon at the time of redemption, together with accrued and unpaid
interest, if any, thereon to, but not including, the redemption date. In no event will the
redemption price ever be less than 100% of the principal amount of the 2014 Notes plus accrued
interest, if any, thereon to the redemption date. Notwithstanding Section 11.2 of the Indenture,
notice of the foregoing redemption need not set forth the redemption price but only the manner of
calculation thereof. The Issuer shall give the Trustee notice of the redemption price promptly
after the calculation thereof and the Trustee shall have no responsibility for such calculation.
The 2014 Notes shall be purchased by the Issuer at the option of the Holders thereof as provided in
Article III hereof.

(f) The 2014 Notes shall not be convertible.

(g) The 2014 Notes will not be subordinated to the payment of Senior Debt.

(h) The Issuer will not pay any additional amounts on the 2014 Notes held by a Person who is
not a U.S. person (as defined in Regulation S under the Securities Act) in respect of any tax,
assessment or government charge withheld or deducted.

(i) The events specified in Events of Default with respect to the 2014 Notes shall include the
events specified in Article VI hereof. In addition to the covenants set forth in Article Three of
the Original Indenture, the Holders of the 2014 Notes shall have the benefit of the covenants of
the Issuer set forth in Article IV hereof. The provisions of Section 9.1 and Section 9.2 of the
Original Indenture shall be amended and restated solely with respect to the 2014 Notes as specified
in Article V hereof.

(j) The 2014 Notes are issuable only in registered form without coupons in minimum
denominations of $2,000 and any integral multiple of $1,000 in excess thereof.

(k) The provisions of Article VII, Article VIII and Article IX hereof shall apply to the 2014
Notes as specified therein.

SECTION 2.02. Forms Generally. The 2014 Notes and Trustee’s certificate of authentication
shall be in substantially the form set forth in this Article II, with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by the Indenture, and
may have such letters, numbers or other marks of identification and such legends or endorsements
placed thereon as may be required to comply with the rules of any securities exchange or as may,
consistently herewith, be determined by the officers executing such 2014 Notes, as evidenced by
their execution thereof.

The definitive 2014 Notes shall be printed, lithographed or engraved on steel engraved borders
or may be produced in any other manner, all as determined by the officers executing such 2014
Notes, as evidenced by their execution thereof.

SECTION 2.03. Form of Face of 2014 Note.

THIS SECURITY IS A REGISTERED GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS
SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE
OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY.

Unless this Global Note is presented by an authorized representative of The Depository Trust
Company, a New York corporation (“DTC”), to CMS Energy Corporation or its agent for registration of
transfer, exchange or payment, and any certificate issued is registered in the name of a nominee of
DTC or in such other name as is requested by an authorized representative of DTC (and any payment
is made to such nominee of DTC or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof has an interest herein.

CMS ENERGY CORPORATION

2.75% SENIOR NOTE DUE 2014

No. 1 $250,000,000

CUSIP No.: 125896BH2

ISIN No.: US125896BH28

CMS Energy Corporation, a corporation duly organized and existing under the laws of the State
of Michigan (herein called the “Issuer”, which term includes any successor Person under the
Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or
registered assigns, the principal sum of Two Hundred Fifty Million Dollars on May 15, 2014 (“Stated
Maturity”) and to pay interest thereon from May 12, 2011 (the “Original Issue Date”) or from the
most recent Interest Payment Date to which interest has been paid or duly provided for,
semi-annually in arrears on May 15 and November 15 in each year, commencing on November 15, 2011
(each an “Interest Payment Date”), to the Persons in whose names the 2014 Notes are registered at
5:00 p.m., New York City time, on the May 1 and November 1 (whether or not a Business Day) next
preceding the relevant Interest Payment Date (each a “Record Date”), and on the Stated Maturity, to
the Person to whom the principal amount is paid, at the rate of 2.75% per annum, until the
principal hereof is paid or made available for payment. The amount of interest payable on any
Interest Payment Date shall be computed on the basis of a 360-day year of twelve 30-day months.
Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to
the Holder on such Record Date and may either be paid to the Person in whose name this 2014 Note
(or one or more Predecessor 2014 Notes) is registered at 5:00 p.m., New York City time, on a
subsequent record date (which shall be not less than five Business Days prior to the date of
payment of such defaulted interest) for the payment of such defaulted interest to be fixed by the
Trustee, notice whereof shall be given to Holders of 2014 Notes not less than 15 calendar days
preceding such subsequent Record Date.

Payment of the principal of (and premium, if any) and interest on this 2014 Note will be made
at the office or agency of the Issuer maintained for that purpose in New York, New York (the “Place
of Payment”), in such coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts; provided, however, that at the option of the
Issuer payment of interest (other than interest payable at Maturity) may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the Security Register or
by wire transfer to an account designated by such Person not later than ten days prior to the date
of such payment.

Reference is hereby made to the further provisions of this 2014 Note set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place.

Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual signature, this 2014 Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.

IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly executed under its
corporate seal.

Dated:

CMS ENERGY CORPORATION

By

Its:

By

Its:

SECTION 2.04. Form of Reverse of 2014 Note.

This 2.75% Senior Note due 2014 is one of a duly authorized issue of securities of the Issuer
(herein called the “2014 Notes”), issued and to be issued under an Indenture, dated as of September
15, 1992 (as supplemented by the Twenty-Seventh Supplemental Indenture, dated as of May 12, 2011
and as further amended or supplemented from time to time, the “Indenture”), between the Issuer and
The Bank of New York Mellon, a New York banking corporation (ultimate successor to NBD Bank,
National Association), as Trustee (herein called the “Trustee”, which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Issuer, the Trustee, and the Holders of the 2014 Notes and of the
terms upon which the 2014 Notes are, and are to be, authenticated and delivered. This 2014 Note is
one of the series designated on the face hereof, issued in an initial aggregate principal amount of
$250,000,000. Additional Securities, without limitation as to amount, having substantially the
same terms as the 2014 Notes (except a different issue date, a different issue price and bearing
interest from the last Interest Payment Date to which interest has been paid or duly provided for
on the 2014 Notes, and, if no interest has been paid, from May 12, 2011), may also be issued by the
Issuer pursuant to the Indenture without the consent of the existing Holders of the 2014 Notes;
provided, that such additional Securities must be part of the same issue as the 2014 Notes for
United States federal income tax purposes. Such additional Securities shall be part of the same
series as the 2014 Notes.

No sinking fund is provided for the 2014 Notes.

The 2014 Notes are subject to redemption at the option of the Issuer, in whole or in part,
upon not less than 30 nor more than 60 days’ notice as provided in the Indenture at any time and
from time to time, at a redemption price equal to 100% of the principal amount of such 2014 Notes
being redeemed plus the Applicable Premium, if any, thereon at the time of redemption, together
with accrued and unpaid interest, if any, thereon to, but not including, the redemption date, but
interest installments whose Stated Maturity is on or prior to such redemption date will be payable
to the Holder of record at the close of business on the relevant Record Date referred to on the
face hereof, all as provided in the Indenture. In no event will the redemption price ever be less
than 100% of the principal amount of the 2014 Notes plus accrued interest to the redemption date.

The following definitions are used to determine the Applicable Premium:

“Applicable Premium” means, with respect to a 2014 Note (or portion thereof) being redeemed at
any time, the excess of (A) the present value at such time of the principal amount of such 2014
Note (or portion thereof) being redeemed plus all interest payments due on such 2014 Note (or
portion thereof) after the redemption date (but, for the avoidance of doubt, excluding any portion
of such payments of interest accrued to the redemption date), which present value shall be computed
using a discount rate equal to the Treasury Rate plus 25 basis points, over (B) the principal
amount of such 2014 Note (or portion thereof) being redeemed at such time. For purposes of this
definition, the present values of the interest and principal payments will be determined in
accordance with generally accepted principles of financial analysis.

“Treasury Rate” means the yield to maturity at the time of computation of United States
Treasury securities with a constant maturity (as compiled and published in the most recent Federal
Reserve Statistical Release H.15(519) which has become publicly available at least two Business
Days prior to the redemption date or, in the case of defeasance, prior to the date of deposit (or,
if such Statistical Release is no longer published, any publicly available source of similar market
data)) most nearly equal to the then remaining average life to stated maturity of the 2014 Notes;
provided, however, that if the average life to stated maturity of the 2014 Notes is not equal to
the constant maturity of a United States Treasury security for which a weekly average yield is
given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest
one-twelfth of a year) from the weekly average yields of United States Treasury securities for
which such yields are given.

If a Change of Control Repurchase Event occurs, the Issuer shall notify the Holder of this
2014 Note of such occurrence and such Holder shall have the right to require the Issuer to make a
Required Repurchase of all or any part of this 2014 Note at a Change of Control Purchase Price
equal to 101% of the principal amount of this 2014 Note to be so purchased as more fully provided
in the Indenture and subject to the terms and conditions set forth therein. In the event of a
Required Repurchase of only a portion of this 2014 Note, a new 2014 Note or 2014 Notes for the
unrepurchased portion hereof will be issued in the name of the Holder hereof upon the cancellation
hereof.

If an Event of Default with respect to this 2014 Note shall occur and be continuing, the
principal of this 2014 Note may be declared due and payable in the manner and with the effect
provided in the Indenture.

In any case where any Interest Payment Date, redemption date, repurchase date, Stated Maturity
or Maturity of any 2014 Note shall not be a Business Day, then (notwithstanding any other provision
of the Indenture or this 2014 Note) payment of interest or principal (and premium, if any) need not
be made on such date, but may be made on the next succeeding Business Day with the same force and
effect as if made on the Interest Payment Date, redemption date, repurchase date or Stated Maturity
or at Maturity; provided that no interest shall accrue on the amount so payable for the period from
and after such Interest Payment Date, redemption date, repurchase date, Stated Maturity or
Maturity, as the case may be, to such Business Day.

The Trustee and the Paying Agent shall return to the Issuer upon written request any money or
property held by them for the payment of any amount with respect to the 2014 Notes that remains
unclaimed for two years, provided, however, that the Trustee or such Paying Agent, before being
required to make any such return, shall at the expense of the Issuer cause to be published once in
a newspaper of general circulation in The City of New York or mail to each such Holder notice that
such money or property remains unclaimed and that, after a date specified therein, which shall not
be less than 30 days from the date of such publication or mailing, any unclaimed money or property
then remaining shall be returned to the Issuer. After return to the Issuer, Holders entitled to
the money or property must look to the Issuer for payment as general creditors unless an applicable
abandoned property law designates another Person.

The Indenture contains provisions for defeasance at any time of (i) the entire indebtedness of
this 2014 Note or (ii) certain restrictive covenants and Events of Default with respect to this
2014 Note, in each case upon compliance with certain conditions set forth therein.

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Issuer and the rights of the Holders of all
outstanding 2014 Notes under the Indenture at any time by the Issuer and the Trustee with the
consent of the Holders of not less than a majority in principal amount of Securities of all series
(including the 2014 Notes) then outstanding and affected (voting as one class).

The Indenture permits the Holders of a majority in principal amount of Securities of all
series at the time outstanding with respect to which a default shall have occurred and be
continuing (voting as one class) to waive on behalf of the Holders of all outstanding Securities of
such series any past default by the Issuer, provided that no such waiver may be made with respect
to a default in the payment of the principal of or the interest on any Security of such series, the
default in the payment of the redemption price or Change of Control Purchase Price with respect to
the 2014 Notes, or the default by the Issuer in respect of certain covenants or provisions of the
Indenture, the modification or amendment of which must be consented to by the Holder of each
outstanding Security of each series affected.

As set forth in, and subject to, the provisions of the Indenture, no Holder of any 2014 Note
will have any right to institute any proceeding with respect to the Indenture or for any remedy
thereunder, unless such Holder shall have previously given to the Trustee written notice of a
continuing Event of Default, the Holders of not less than 25% in principal amount of the
outstanding Securities of each affected series (voting as one class) shall have made written
request, and offered reasonable indemnity against costs, expenses and liabilities, to the Trustee
to institute such proceeding as trustee, and the Trustee shall not have received from the Holders
of a majority in principal amount of the outstanding Securities of each affected series (voting as
one class) a direction inconsistent with such request and shall have failed to institute such
proceeding within 60 days; provided, however, that such limitations do not apply to a suit
instituted by the Holder hereof for the enforcement of payment of the principal of (and premium, if
any) or any interest on this 2014 Note on or after the respective due dates expressed herein.

No reference herein to the Indenture and no provision of this 2014 Note or of the Indenture
shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the
principal of and any premium and interest on this 2014 Note at the times, place and rate, and in
the coin or currency, herein prescribed.

As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this 2014 Note is registrable in the Security Register, upon surrender of this 2014
Note for registration of transfer at the office or agency of the Issuer in any place where the
principal of and any premium and interest on this 2014 Note are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Security
Registrar duly executed by, the Holder hereof or such Holder’s attorney duly authorized in writing,
and thereupon one or more new 2014 Notes of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the designated
transferee or transferees.

The 2014 Notes are issuable only in registered form without coupons in minimum denominations
of $2,000 and any integral multiple of $1,000 in excess thereof. As provided in the Indenture and
subject to certain limitations therein set forth, 2014 Notes are exchangeable for a like aggregate
principal amount of 2014 Notes and of like tenor of a different authorized denomination, as
requested by the Holder surrendering the same.

No service charge shall be made for any such registration of transfer or exchange, but the
Issuer may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.

The Issuer shall not be required to (i) issue, exchange or register the transfer of this 2014
Note for a period of 15 days next preceding the mailing of the notice of redemption of 2014 Notes
or (ii) exchange or register the transfer of any 2014 Note or any portion thereof selected, called
or being called for redemption, except in the case of any 2014 Note to be redeemed in part, the
portion thereof not so to be redeemed.

Prior to due presentment of this 2014 Note for registration of transfer, the Issuer, the
Trustee and any agent of the Issuer or the Trustee may treat the Person in whose name this 2014
Note is registered as the owner hereof for all purposes, whether or not this 2014 Note be overdue,
and neither the Issuer, the Trustee nor any such agent shall be affected by notice to the contrary.

All terms used in this 2014 Note without definition which are defined in the Indenture shall
have the meanings assigned to them in the Indenture. In case of any conflict between this 2014
Note and the Indenture, the provisions of the Indenture shall control.

SECTION 2.05. Form of Trustee’s Certificate of Authentication. The Trustee’s certificate of
authentication shall be in substantially the following form:

This is one of the Securities of the series designated herein referred to in the
within-mentioned Indenture.

THE BANK OF NEW YORK MELLON,

as Trustee

By

Authorized Officer

SECTION 2.06. Rights of Trustee. The Trustee shall not be deemed to have notice, or be
charged with knowledge, of any event requiring notice under the Indenture unless the Trustee shall
have received from the Issuer or other requisite party such notice in writing.

ARTICLE III

CHANGE OF CONTROL

SECTION 3.01. Change of Control. Upon the occurrence of a Change of Control Repurchase Event
(the effective date of such Change of Control Repurchase Event being the “Change of Control Date”),
each Holder of a 2014 Note shall have the right to require that the Issuer repurchase (a “Required
Repurchase”) all or any part of such Holder’s 2014 Note at a repurchase price payable in cash equal
to 101% of the principal amount of such 2014 Note plus accrued interest, if any, to the Purchase
Date (the “Change of Control Purchase Price”).

(a) Within 30 days following the Change of Control Date, the Issuer shall mail a notice to
each Holder with a copy to the Trustee stating:

(i) that a Change of Control Repurchase Event has occurred and that such Holder has the
right to require the Issuer to repurchase all or any part of such Holder’s 2014 Notes at the
Change of Control Purchase Price;

(ii) the Change of Control Purchase Price;

(iii) the date on which any Required Repurchase shall be made (which shall be no
earlier than 60 days nor later than 90 days from the date such notice is mailed) (the
“Purchase Date”);

(iv) the name and address of the Paying Agent; and

(v) the procedures that Holders must follow to cause the 2014 Notes to be repurchased,
which shall be consistent with this Section 3.01 and the Indenture.

(b) Holders electing to have a 2014 Note repurchased must deliver a written notice (the
“Change of Control Purchase Notice”) to the Paying Agent (initially the Trustee) at its corporate
trust office in New York, New York, or any other office of the Paying Agent maintained for such
purposes, not later than 30 days prior to the Purchase Date. The Change of Control Purchase Notice
shall state: (i) the portion of the principal amount of any 2014 Notes to be repurchased, which
portion must be a minimum of $1,000 and in $1,000 integral multiples, provided, that any
unrepurchased portion of a 2014 Note must be in a minimum denomination of $2,000; (ii) that such
2014 Notes are to be repurchased by the Issuer pursuant to the change of control provisions of the
Indenture; and (iii) unless the 2014 Notes are represented by one or more Global Notes, the
certificate numbers of the 2014 Notes to be delivered by the Holder thereof for repurchase by the
Issuer. Any Change of Control Purchase Notice may be withdrawn by the Holder by a written notice
of withdrawal delivered to the Paying Agent not later than three Business Days prior to the
Purchase Date. The notice of withdrawal shall state the principal amount and, if applicable, the
certificate numbers of the 2014 Notes as to which the withdrawal notice relates and the principal
amount of such 2014 Notes, if any, which remains subject to a Change of Control Purchase Notice.

If a 2014 Note is represented by a Global Note (as described in Article IX hereof), the
Depositary or its nominee will be the Holder of such 2014 Note and therefore will be the only
entity that can elect a Required Repurchase of such 2014 Note. To obtain repayment pursuant to
this Section 3.01 with respect to such 2014 Note, the beneficial owner of such 2014 Note must
provide to the broker or other entity through which it holds the beneficial interest in such 2014
Note (i) the Change of Control Purchase Notice signed by such beneficial owner, and such signature
must be guaranteed by a member firm of a registered national securities exchange or of the
Financial Industry Regulatory Authority, Inc. or a commercial bank or trust company having an
office or correspondent in the United States, and (ii) instructions to such broker or other entity
to notify the Depositary of such beneficial owner’s desire to obtain repayment pursuant to this
Section 3.01. Such broker or other entity will be responsible for disbursing any payments it
receives pursuant to this Section 3.01 to such beneficial owner.

(c) Payment of the Change of Control Purchase Price for a 2014 Note for which a Change of
Control Purchase Notice has been delivered and not withdrawn is conditioned (except in the case of
a 2014 Note represented by one or more Global Notes) upon delivery of such 2014 Note (together with
necessary endorsements) to the Paying Agent at its office in New York, New York, or any other
office of the Paying Agent maintained for such purpose, at any time (whether prior to, on or after
the Purchase Date) after the delivery of such Change of Control Purchase Notice. Payment of the
Change of Control Purchase Price for such 2014 Note will be made promptly following the later of
the Purchase Date or the time of delivery of such 2014 Note. If the Paying Agent holds, in
accordance with the terms of the Indenture, money sufficient to pay the Change of Control Purchase
Price of such 2014 Note on the Purchase Date, then, on and after such date, interest will cease
accruing, and all other rights of the Holder shall terminate (other than the right to receive the
Change of Control Purchase Price upon delivery of the 2014 Note).

(d) The Issuer shall comply with the provisions of Regulation 14E and any other tender offer
rules under the Exchange Act, which may then be applicable in connection with any offer by the
Issuer to repurchase 2014 Notes at the option of Holders upon a Change of Control Repurchase Event.

(e) No 2014 Note may be repurchased by the Issuer as a result of a Change of Control
Repurchase Event if there has occurred and is continuing an Event of Default (other than a default
in the payment of the Change of Control Purchase Price with respect to the 2014 Notes).

ARTICLE IV

ADDITIONAL COVENANTS OF THE ISSUER

WITH RESPECT TO THE 2014 NOTES

SECTION 4.01. Existence. So long as any of the 2014 Notes are outstanding, subject to
Article Nine of the Original Indenture, the Issuer will do or cause to be done all things necessary
to preserve and keep in full force and effect its corporate existence.

SECTION 4.02. Limitation on Certain Liens. So long as any of the 2014 Notes are outstanding,
the Issuer shall not create, incur, assume or suffer to exist any lien, mortgage, pledge, security
interest, conditional sale, title retention agreement or other charge or encumbrance of any kind,
or any other type of arrangement intended or having the effect of conferring upon a creditor of the
Issuer or any Subsidiary a preferential interest (a “Lien”) upon or with respect to any of its
property of any character, including without limitation any shares of Capital Stock of Consumers or
Enterprises, without making effective provision whereby the 2014 Notes shall (so long as any such
other creditor shall be so secured) be equally and ratably secured (along with any other creditor
similarly entitled to be secured) by a direct Lien on all property subject to such Lien, provided,
however, that the foregoing restrictions shall not apply to:

(i) Liens for taxes, assessments or governmental charges or levies to the extent not
past due;

(ii) pledges or deposits to secure (A) obligations under workmen’s compensation laws or
similar legislation, (B) statutory obligations of the Issuer or (C) Support Obligations;

(iii) Liens imposed by law, such as materialmen’s, mechanics’, carriers’, workmen’s and
repairmen’s Liens and other similar Liens arising in the ordinary course of business
securing obligations which are not overdue or which have been fully bonded and are being
contested in good faith;

(iv) purchase money Liens upon or in property acquired and held by the Issuer in the
ordinary course of business to secure the purchase price of such property or to secure
Indebtedness incurred solely for the purpose of financing the acquisition of any such
property to be subject to such Liens, or Liens existing on any such property at the time of
acquisition, or extensions, renewals or replacements of any of the foregoing for the same or
a lesser amount, provided that no such Lien shall extend to or cover any property other than
the property being acquired and no such extension, renewal or replacement shall extend to or
cover property not theretofore subject to the Lien being extended, renewed or replaced, and
provided, further, that the aggregate principal amount of the Indebtedness at any one time
outstanding secured by Liens permitted by this Section 4.02(iv) shall not exceed
$10,000,000; and

(v) Liens not otherwise permitted by Section 4.02(i) through Section 4.02(iv) hereof
securing Indebtedness of the Issuer; provided that on the date such Liens are created, and
after giving effect to such Indebtedness, the aggregate principal amount at maturity of all
of the secured Indebtedness of the Issuer at such date shall not exceed 10% of Consolidated
Net Tangible Assets at such date.

SECTION 4.03. Reporting. For purposes of Section 4.3(a) of the Original Indenture solely
with respect to the 2014 Notes (but not with respect to any other series of Securities), the
Trustee agrees that documents filed by the Issuer with the Commission via the Commission’s EDGAR
system (or any successor thereto) will constitute filing of the same with the Trustee as of the
time such documents are so filed.

ARTICLE V

CONSOLIDATION, MERGER AND TRANSFER OF PROPERTY

SECTION 5.01. Limitation on Consolidation, Merger and Transfer. Section 9.1 of the Original
Indenture is hereby amended and restated solely with respect to the 2014 Notes (but not with
respect to any other series of Securities) as follows, and all references in the Original Indenture
to Section 9.1 thereof and to the provisions specified therein shall, with respect to the 2014
Notes, be deemed to be references to this Section 5.01 and to the provisions specified herein,
respectively.

“Nothing contained in the Indenture or in any of the 2014 Notes shall prevent any
consolidation or merger of the Issuer with or into any other Person or Persons (whether or not
affiliated with the Issuer), or successive consolidations or mergers in which the Issuer or its
successor or successors shall be a party or parties, or shall prevent any conveyance, transfer or
lease of the property of the Issuer as an entirety or substantially as an entirety, to any other
Person (whether or not affiliated with the Issuer); provided, however, that:

(a) in case the Issuer shall consolidate with or merge into another Person or convey, transfer
or lease its properties and assets as an entirety or substantially as an entirety to any Person,
the entity formed by such consolidation or into which the Issuer is merged or the Person that
acquires by conveyance or transfer, or that leases, the properties and assets of the Issuer as an
entirety or substantially as an entirety shall be a corporation or a limited liability company
organized and existing under the laws of the United States of America, any state thereof or the
District of Columbia and shall expressly assume, by an indenture (or indentures, if at such time
there is more than one Trustee) supplemental to the Indenture, executed by the successor Person and
delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the
principal of and any premium and interest on the 2014 Notes and the performance of every obligation
in the Indenture and the outstanding 2014 Notes on the part of the Issuer to be performed or
observed;

(b) immediately after giving effect to such transaction, no Event of Default or event that,
after notice or lapse of time, or both, would become an Event of Default, shall have occurred and
be continuing; and

(c) either the Issuer or the successor Person shall have delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance,
transfer or lease and, if a supplemental indenture is required in connection with such transaction,
such supplemental indenture complies with the provisions of the Indenture and all conditions
precedent therein relating to such transaction.”

SECTION 5.02. Successor Person Substituted for the Issuer. Section 9.2 of the Original
Indenture is hereby amended and restated solely with respect to the 2014 Notes (but not with
respect to any other series of Securities) as follows, and all references in the Original Indenture
to Section 9.2 thereof and to the provisions specified therein shall, with respect to the 2014
Notes, be deemed to be references to this Section 5.02 and to the provisions specified herein,
respectively.

“Upon any consolidation by the Issuer with or merger of the Issuer into any other Person or
any conveyance, transfer or lease of the properties and assets of the Issuer substantially as an
entirety to any Person in accordance with Section 5.01 hereof, the successor Person formed by such
consolidation or into which the Issuer is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and power of, the
Issuer under the Indenture with the same effect as if such successor Person had been named as the
Issuer herein; and thereafter, except in the case of a lease, the predecessor Person shall be
released from all obligations and covenants under the Indenture and the 2014 Notes.

In case of any such consolidation, merger, conveyance, transfer or lease, such changes in
phraseology and form (but not in substance) may be made in the 2014 Notes thereafter to be issued
as may be appropriate.”

ARTICLE VI

ADDITIONAL EVENTS OF DEFAULT

WITH RESPECT TO THE 2014 NOTES

SECTION 6.01. Definition. All of the events specified in Section 5.1(a) through Section
5.1(h) of the Original Indenture shall be “Events of Default” with respect to the 2014 Notes.

SECTION 6.02. Amendments to Section 5.1 of the Original Indenture. Solely for the purpose of
determining Events of Default with respect to the 2014 Notes (but not with respect to any other
series of Securities), Section 5.1(e), Section 5.1(f) and Section 5.1(h) of the Original Indenture
shall be amended such that each and every reference in Section 5.1(e) and Section 5.1(f) and the
first two references in Section 5.1(h) of the Original Indenture to the Issuer shall be deemed to
mean either the Issuer or Consumers.

SECTION 6.03. Additional Events of Default. Solely for the purpose of determining Events of
Default with respect to the 2014 Notes (but not with respect to any other series of Securities), an
Event of Default shall also include default in the Issuer’s obligation to redeem the 2014 Notes
after exercising its redemption option pursuant to this Twenty-Seventh Supplemental Indenture.

SECTION 6.04. Additional Waivers of Past Defaults. In addition to those matters set forth in
Section 5.10 of the Original Indenture, solely with respect to the 2014 Notes (but not with respect
to any other series of Securities), approval of the Holders of each outstanding 2014 Note shall be
required to waive any default in any payment of the redemption price or Change of Control Purchase
Price with respect to any 2014 Note.

ARTICLE VII

DISCHARGE OF INDENTURE AND DEFEASANCE

All of the provisions of Article Ten of the Original Indenture shall be applicable to the 2014
Notes. Upon satisfaction by the Issuer of the requirements of Section 10.1(C) of the Original
Indenture, in connection with any covenant defeasance (as provided in Section 10.1(C) of the
Original Indenture), the Issuer shall be released from its obligations under Article Three and
Article Nine of the Original Indenture and under Article IV and Article V hereof with respect to
the 2014 Notes and the omission to comply with such obligations under such Articles upon such
covenant defeasance shall not constitute an Event of Default under the Indenture with respect to
the 2014 Notes.

ARTICLE VIII

MODIFICATION AND WAIVER

SECTION 8.01. Without Consent of Holders. In addition to any permitted amendment or
supplement to the Indenture pursuant to Section 8.1(a), Section 8.1(b), Section 8.1(c), Section
8.1(e) and Section 8.1(f) of the Original Indenture, the Issuer and the Trustee may amend or
supplement the Indenture (to the extent applicable to the 2014 Notes) or the 2014 Notes without
notice to or the consent of any Holder, to:

(a) surrender any right or power conferred upon the Issuer;

(b) comply with the requirements of the Commission in order to effect or maintain the
qualification of the Indenture under the Trust Indenture Act of 1939, as amended; and

(c) add guarantees of obligations under the 2014 Notes.

In addition, Section 8.1(d) of the Original Indenture is hereby amended and restated solely
with respect to the 2014 Notes (but not with respect to any other series of Securities) as follows,
and all references in the Original Indenture to Section 8.1(d) thereof shall, with respect to the
2014 Notes, be deemed to be references to the following provisions of this Section 8.01:

“(d)(1) cure any ambiguity or correct or supplement any inconsistent or otherwise defective
provision contained in the Indenture; provided that such modification or amendment does not
adversely affect the interests of the Holders of the 2014 Notes in any material respect; provided,
further, that any amendment made solely to conform the provisions of the Indenture and the form or
terms of the 2014 Notes to the section entitled “Description of the Notes” as set forth in the
final prospectus supplement related to the offering and sale of the 2014 Notes dated May 9, 2011
will not be deemed to adversely affect the interests of the Holders of the 2014 Notes;

(d)(2) make any provision with respect to matters or questions arising under the Indenture
that the Issuer may deem necessary or desirable and that shall not be inconsistent with provisions
of the Indenture; provided, that such change or modification does not, in the good faith opinion of
the Board of Directors, adversely affect the interests of the Holders of the 2014 Notes in any
material respect;”

SECTION 8.02. With Consent of Holders. In addition to those matters set forth in Section 8.2
of the Original Indenture, solely with respect to the 2014 Notes (but not with respect to any other
series of Securities), no amendment or supplemental indenture to the Indenture shall, without the
consent of the Holder of each 2014 Note affected thereby:

(a) reduce the redemption price or Change of Control Purchase Price of the 2014 Notes;

(b) change the terms applicable to redemption or purchase of the 2014 Notes in a manner
adverse to the Holder; or

(c) change the Issuer’s obligation to maintain an office or agency in New York, New York.

ARTICLE IX

GLOBAL NOTES

The 2014 Notes will be issued initially in the form of one or more Global Notes. “Global
Note” means a registered 2014 Note evidencing one or more 2014 Notes issued to a depositary (the
“Depositary”) or its nominee, in accordance with this Article IX and bearing the legend prescribed
in this Article IX. The Issuer hereby designates The Depository Trust Company as the Depositary.
The Issuer shall execute and the Trustee shall, in accordance with this Article IX and the Issuer
Order with respect to the 2014 Notes, authenticate and deliver one or more Global Notes in
temporary or permanent form that (i) shall represent and shall be denominated in an aggregate
amount equal to the aggregate principal amount of the 2014 Notes to be represented by such Global
Note or Global Notes, (ii) shall be registered in the name of the Depositary for such Global Note
or Global Notes or the nominee of such Depositary, (iii) shall be delivered by the Trustee to such
Depositary or pursuant to such Depositary’s instructions and (iv) shall bear a legend substantially
to the following effect: “Unless this Global Note is presented by an authorized representative of
the Depositary to the Issuer or its agent for registration of transfer, exchange or payment, and
any certificate issued is registered in the name of a nominee of the Depositary or in such other
name as is requested by an authorized representative of the Depositary (and any payment is made to
such nominee of the Depositary or to such other entity as is requested by an authorized
representative of the Depositary), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof has an interest herein.”

Notwithstanding Section 2.8 of the Original Indenture, unless and until it is exchanged in
whole or in part for 2014 Notes in definitive form, a Global Note representing one or more 2014
Notes may not be transferred except as a whole by the Depositary to a nominee of such Depositary or
by a nominee of such Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor Depositary for 2014 Notes or a nominee of such
successor Depositary.

If at any time the Depositary for the 2014 Notes is unwilling or unable to continue as
Depositary for the 2014 Notes, defaults in the performance of its duties as Depositary or ceases to
be a clearing agency registered under the Exchange Act or other applicable statute or regulation,
the Issuer shall appoint a successor Depositary with respect to the 2014 Notes. If a successor
Depositary for the 2014 Notes is not appointed by the Issuer by the earlier of (x) 90 days from the
date the Issuer receives notice to the effect that the Depositary is unwilling or unable to act, or
the Issuer determines that the Depositary is unable to act, or (y) the effectiveness of the
Depositary’s resignation or failure to fulfill its duties as Depositary, the Issuer will execute,
and the Trustee, upon receipt of an Issuer Order for the authentication and delivery of definitive
2014 Notes, will authenticate and deliver 2014 Notes in definitive form in an aggregate principal
amount equal to the principal amount of the Global Note or Global Notes representing such 2014
Notes in exchange for such Global Note or Global Notes.

If the Issuer so specifies with respect to any 2014 Notes, an owner of a beneficial interest
in a Global Note representing the 2014 Notes may, on terms acceptable to the Issuer and the
Depositary for the Global Note, receive individual 2014 Notes in exchange for the beneficial
interest. In any such instance, an owner of a beneficial interest in a Global Note will be
entitled to physical delivery in definitive form of 2014 Notes represented by the Global Note equal
in principal amount to the beneficial interest, and to have the 2014 Notes registered in its name.
2014 Notes so issued in definitive form will be issued as registered 2014 Notes in minimum
denominations of $2,000 and in $1,000 integral multiples, unless otherwise specified by the Issuer.

Upon the exchange of a Global Note for 2014 Notes in definitive form, such Global Note shall
be cancelled by the Trustee. 2014 Notes in definitive form issued in exchange for a Global Note
pursuant to this Article IX shall be registered in such names and in such authorized denominations
as the Depositary for such Global Note, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee or Security Registrar. The Trustee shall
deliver such 2014 Notes to the Persons in whose names such 2014 Notes are so registered.

ARTICLE X

SUPPLEMENTAL INDENTURES

This Twenty-Seventh Supplemental Indenture is a supplement to the Original Indenture. As
supplemented by this Twenty-Seventh Supplemental Indenture, the Original Indenture is in all
respects ratified, approved and confirmed, and the Original Indenture and this Twenty-Seventh
Supplemental Indenture shall together constitute one and the same instrument.

ARTICLE XI

INAPPLICABLE PROVISIONS OF THE ORIGINAL INDENTURE

The 2014 Notes shall not constitute Subordinated Securities and the provisions of Article
Twelve of the Original Indenture shall not apply to the Notes.

TESTIMONIUM

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

1

IN WITNESS WHEREOF, the parties hereto have caused this Twenty-Seventh Supplemental Indenture
to be duly executed and their respective corporate seals to be hereunto affixed and attested, all
as of the day and year first written above.

CMS ENERGY CORPORATION

By: /s/ Laura L. Mountcastle

Laura L. Mountcastle

Vice President and Treasurer

Attest: /s/ Shelley J. Ruckman

THE BANK OF NEW YORK MELLON,

as Trustee

 /s/ Laurence J. O’Brien

Laurence J. O’Brien

Vice President

Attest: /s/ Timothy W. Casey

2sinx_ex1042.htm

 

EXHIBIT 10.42

 

TABLE OF ARTICLES

1.           Definitions

2.           Wenning

3.           Sionix

4.           Time

5.           Payments

6.           Protection of Persons and Property

7.           Insurance

8.           Changes in the Work

9.           Correction of Work

10.           Dispute Resolution

11.           Miscellaneous Provisions

12.           Termination of the Agreement

13.           Basis of Compensation

14.           Other Conditions and Services

15.           General Provisions

  

 

  

Exhibits/Schedules/Drawings

	
Exhibit

	 	
Description

	 	
Contract Article

	
A

	 	
Pricing Schedule

	 	
Recitals (A)

Paragraph 5.1

Paragraph 13.1

	
B

	 	
Letter of Intent

	 	
Recitals (C)

	
C

	 	
Water Quality Guidelines

	 	
Paragraph 1.1.2

Paragraph 4.4

	
D

	 	
Exceptions to Water Quality Guidelines

	 	
Paragraph 1.1.2

Paragraph 4.4

	
E

	 	
Permits and Licenses

	 	
Paragraph 2.10

	
F

	 	
Mutual Confidentiality and Non-Disclosure Agreement

	 	
Paragraph 2.10

	
G

	 	
Key Personnel

	 	
Paragraph 3.1.4

	
H

	 	
Sionix Warranty Statement

	 	
Paragraph 3.2.5

	  	 	  	 	  
	
Schedule

	 	
Description

	 	
Contract Article

	
1

	 	
Construction Schedule

	 	
Paragraph 14.1

	  	 	  	 	  
	
Drawing

	 	
Description

	 	
Contract Article

	
1

	 	
System Configuration

	 	
Recitals (A)

 

 

 

 

 

 

THIS PURCHASE AGREEMENT (the "Agreement") is made and entered into and is effective as of August 6, 2010, by and between Wenning Poultry, Inc., an Ohio corporation (“WENNING"), with a location at 1500 Union City Road, Ft. Recovery, OH 45846 and SIONIX CORPORATION, a Nevada corporation ("SIONIX"), with a location at 2801 Ocean Park Blvd., Suite 339, Santa Monica, CA 90405.

RECITALS

A.         WENNING desires to purchase a Mobile Water Treatment System (the "SIONIX MWTS") to be located on the Wenning Farm (the "Site") near Ft. Recovery, Ohio. This Agreement provides for specific terms and conditions pursuant to which SIONIX shall design, configure, fabricate, assemble and install, start-up, and commission the SIONIX MWTS on the Wenning Farm.  The configuration of the SIONIX MWTS is defined in the Purchase/Pricing Proposal of June 13, 2010 and the System Configuration Drawing, attached hereto and incorporated herein by reference as Exhibit "A" and Drawing "1."

B.         The installation of the SIONIX MWTS on the designated Site will be referred to as the "MWTS Project."

C.         This Agreement hereby incorporates the prior non-binding Letter of Intent (the “LOI”) between the Parties relating to the SIONIX MWTS, dated May 14, 2010, attached hereto and incorporated herein as Exhibit "B." In the event of any conflict or inconsistency between the provisions of this Agreement and the provisions of the LOI, the provisions of this Agreement shall control.

NOW, THEREFORE, the parties hereto agree as follows:

ARTICLE 1 - DEFINITIONS

1.1.  BASIC DEFINITIONS

1.1.1. THE CONTRACT DOCUMENTS. The Contract Documents consist of this Agreement, the Exhibits, Schedules and Drawings attached hereto, and any Modifications issued after execution of this Agreement. A Modification is a Change Order or a written amendment to this Agreement signed by both parties as more fully described in Article 8 hereunder.

1.1.2. THE SIONIX MWTS: THE WORK. The term "Work" with respect to the SIONIX MWTS means the design, configuration, component selection, manufacture, assembly of the SIONIX MWTS and the subsequent installation, start-up, commissioning, training and other services as may be required thereafter on the WENNING Site by SIONIX to fulfill the SIONIX obligations as provided in this Agreement. SIONIX shall perform the Work and turn the SIONIX MWTS over to WENNING in a manner that is: (i) sufficient and adequate in all respects necessary to successfully accomplish Substantial Completion; (ii) in conformance with FAO Agricultural Drainage Water Management in Arid and Semi Arid Areas, Annex 2, Water Quality Guidelines for Livestock and Poultry Production for Parameters of Concern in Agricultural Drainage Water, attached hereto and incorporated herein by reference as Exhibit "C," except as noted in Exhibit "D," attached hereto and incorporated herein by reference; and (iv) approved as to form, use and content by public and private entities authorized to administer or enforce any building or construction code or standard whose approval of the MWTS Project is necessary for the construction or operation of the SIONIX MWTS all in accordance with all applicable laws (subject to Section 8.5 hereof).  As of the date of this Agreement no such code or standard has been determined applicable to the installation and operation of the SIONIX MWTS on the WENNING Site.

 

  

  

  

 

1.2. EXECUTION, CORRELATION AND INTENT

1.2.1 CONTRACT DOCUMENTS COMPLETE. It is the intent of WENNING and SIONIX that the Contract Documents include all items necessary for proper execution and completion of the Work. The Contract Documents are complementary, and what is required by one shall be as binding as if required by all.  Performance by SIONIX shall be required only to the extent consistent with and reasonably inferable from the Contract Documents as being necessary to produce the intended results. Words that have well-known technical or construction industry meanings are used in the Contract Documents in accordance with such recognized meanings.

1.2.2 NO VIOLATION OF LAW. If SIONIX believes or is advised by another professional retained to provide services on the MWTS Project that implementation of any instruction received from WENNING would cause a violation of any applicable law, SIONIX shall notify WENNING in writing.  SIONIX shall not be obligated to perform any act which it believes will violate any applicable law.

1.2.3 NO THIRD PARTY BENEFICIARIES. Nothing contained in this Agreement shall create a contractual relationship between WENNING and any person or entity other than SIONIX, except that WENNING shall be the intended beneficiary of any subcontracts between SIONIX and other parties for the Work, and of all subcontracts made by such other parties.

1.3. OWNERSHIP AND USE OF DOCUMENTS

1.3.1 OWNERSHIP. Drawings, specifications, and other documents and electronic data furnished by SIONIX are instruments of service. Manufacturing and assembly drawings of the SIONIX MWTS are specifically excluded from those referenced herein and will not be furnished to WENNING.  Subject to this Agreement, SIONIX shall retain all common law, statutory and other reserved rights, including copyright in those instruments of service furnished by them. Individual component specifications, and other supporting documents and electronic data (if any) are furnished for use solely with respect to this Agreement to facilitate installation of the SIONIX MWTS. WENNING shall be permitted to retain copies, including reproducible copies, of such specifications, and other supporting documents and electronic data (if any) furnished by SIONIX for information, reference and future use in connection with the MWTS Project, except as provided in Sections 1.3.2 and 1.3.3 hereof, and is hereby granted a perpetual, non-exclusive royalty-free license for such use.

1.3.2 USE OF DRAWINGS. Component specifications, and other supporting documents and electronic data (if any) furnished by SIONIX shall not be used by WENNING or others on other water treatment projects competitive with the SIONIX MWTS, for additions to this MWTS Project or for completion of this MWTS Project by others, except by agreement in writing and with appropriate compensation to SIONIX.

1.3.4 ACCESS TO DOCUMENTS. Submission or distribution of the Contract Documents to meet official regulatory requirements or for similar purposes in connection with the MWTS Project is not to be construed as publication in derogation of the rights reserved in Section 1.3.1 hereof. WENNING shall have the right to full and complete access to review and study all of the soils reports, environmental reports and all other documents generated or received by SIONIX or any of its subcontractors in connection with the Work, including drafts and work in process, without any representation or warranty by SIONIX, following written notice during business hours.

  

  

  

1.3.5 ROYALTY FREE LICENSE. SIONIX shall incorporate provisions in all its subcontracts with engineers and other design professionals and consultants granting WENNING the rights including, without limitation, a perpetual non-exclusive, royalty free license to use their work product as provided in this Section 1.3. and requiring their respective sub-contractors and sub-consultants to grant WENNING such rights and licenses to WENNING related to the SIONIX MWTS.

ARTICLE 2 - WENNING

2.1 WENNING'S REPRESENTATIVE. WENNING shall designate a representative authorized to act on WENNING's behalf with respect to the MWTS Project (the "WENNING Representative"). WENNING or the WENNING Representative shall examine documents submitted by SIONIX and shall render decisions in a timely manner (not to exceed two (2) business days after receipt of a written request for decision unless otherwise approved by SIONIX in writing) and in accordance with the schedule accepted by WENNING. WENNING may obtain independent review of the Contract Documents by a separate architect, engineer, contractor or cost estimator under contract to, or employed by WENNING. Such independent review shall be undertaken at WENNING's expense in a timely manner (not to exceed two (2) business days after receipt of written request for decision) and shall not delay the orderly progress of the Work. WENNING shall use its commercially reasonable best efforts to require any consultant engaged by WENNING to execute the SIONIX Confidentiality and Nondisclosure Agreement.

2.2 REPORTS. Subject to Section 2.3 hereof, WENNING may be requested to furnish services of land surveyors, geotechnical engineers and other consultants for subsoil, air and water conditions, if such services are necessary for SIONIX to properly carry out the Work required by this Agreement and SIONIX shall be entitled to rely on any reports or analysis delivered with respect to such services; provided, however, that if the event SIONIX knows or learns of any discrepancy between the actual conditions of the Site and any such report or analysis and has confirmed the existence of such discrepancy, SIONIX shall promptly notify WENNING in writing describing such discrepancy and if possible, shall include in such written notice a proposal to remedy such discrepancy.

2.3 REVIEW OF REPORTS. SIONIX shall review all recommendations and reports furnished by such consultants and promptly (not to exceed five (5) business days after receipt of written request therefore) advise WENNING in writing of any questions or concerns SIONIX has regarding such recommendations.

2.4 PRIOR INFORMATION. WENNING shall disclose, to the extent known, the results and reports of prior tests, inspections or investigations conducted for the MWTS Project involving: structural or mechanical systems; chemical, air and water pollution; hazardous materials; or other environmental and subsurface conditions. WENNING shall disclose all information known to WENNING regarding the presence of pollutants on the MWTS Project Site that are not related to the Work.

2.5 RELIANCE ON REPORTS. Those services, information, surveys and reports required by Sections 2.3 through 2.4 which are within WENNING's control shall be furnished at WENNING's expense and subject to the terms hereof, SIONIX shall be entitled to rely upon the accuracy and completeness thereof.

  

  

  

2.6 ADDITIONAL INSURANCE. If WENNING requires SIONIX to maintain any special insurance coverage, policy, amendment, or rider, WENNING shall pay the additional cost thereof, except as otherwise stipulated in this Agreement.

2.7 NOTICE OF DEFECT. If WENNING observes or otherwise becomes aware of a fault or defect in the Work or nonconformity with the Contract Documents, WENNING shall give prompt written notice thereof to SIONIX.

2.8 FINANCIAL CAPABILITY. WENNING shall, at the request of SIONIX, prior to the Commencement Date (as defined herein), furnish to SIONIX reasonable evidence that WENNING has made financial arrangements satisfactory to SIONIX in connection with the MWTS Project.

2.9 SIONIX ACKNOWLEDGMENT. WENNING shall communicate with persons or entities employed or retained by SIONIX only through SIONIX, unless otherwise directed by SIONIX. SIONIX acknowledges that WENNING shall rely on SIONIX for the proper design, configuration, manufacture, installation and completion of the Work, and that WENNING has the right to rely on SIONIX. Subject to its right to rely on the accuracy of information provided by WENNING, SIONIX shall be solely responsible for the proper scheduling of the Work, and WENNING's approval of a schedule or other submittal provided by SIONIX shall not be deemed to operate as a waiver or bar to any rights or claims WENNING may thereafter have against SIONIX in the event WENNING subsequently discovers a deficiency in such approved schedule or other submittal.

2.10 OBLIGATIONS OF WENNING. WENNING agrees to do the following with respect to the SIONIX MWTS:  (i) take such action as reasonably requested by SIONIX (at no cost to WENNING except as otherwise provided herein) to assist SIONIX in obtaining the applicable Permits and Licenses, including those set forth on Exhibit "E," attached hereto and incorporated herein by reference ("Permits"); (ii) pay for the Work in accordance with the terms herein; iii) timely respond to requests for information as reasonably requested by SIONIX; iv) designate the location of the improvements and provide access to the SIONIX MWTS Site (the "Site") in a condition which is suitable for the construction of the SIONIX MWTS; and (v) maintain the confidentiality of proprietary SIONIX information in accordance with and as set forth in the Mutual Confidentiality and Non-Disclosure Agreement, attached hereto and incorporated herein as Exhibit "F,"  to be executed between the parties to this Agreement simultaneous with the execution of this Agreement.

ARTICLE 3 - SIONIX

3.1 SERVICES AND RESPONSIBILITIES

3.1.1 PROFESSIONALS. Services related to the design, system configuration, component selection and specification, manufacture and assembly of the SIONIX MWTS required by this Agreement shall be performed by qualified engineers and other design professionals either on the staff of SIONIX or employed as subcontract engineers by SIONIX. The contractual obligations of such professional persons or entities are undertaken and performed in the interest of WENNING and SIONIX.

3.1.2 RESPONSIBILITY OF SIONIX. SIONIX shall be responsible to WENNING for acts and omissions of the SIONIX employees. Subcontractors and their agents and employees, and other persons performing any portion of the SIONIX obligations under this Agreement.

  

  

  

3.1.3                 PERMITS, FACILITATING, INTERFACING AND COORDINATING WITH WENNING.

(a) Permits. Notwithstanding anything to the contrary contained herein, including paragraph 1.1.2 above, SIONIX shall diligently utilize its commercially reasonable best efforts to obtain all applicable permits, licenses and approvals required by all governmental agencies for the lawful construction and operation of the SIONIX MWTS, including but not limited to those Permits listed on Exhibit "E"; provided, however, that the failure of SIONIX to obtain any permit will not be a default under the Agreement unless such failure is due to SIONIX' failure to comply with the terms of this Agreement.

(b) Interfacing and Coordination With WENNING. SIONIX will be responsible for interfacing and coordinating with WENNING and other consultants employed by WENNING (the "WENNING Consultants") so that all will have sufficient information, lead-time, reminders and guidance from SIONIX to facilitate the timely progress of the Work. SIONIX will provide WENNING with adequate advance written notice of each matter that will require any decision by WENNING. The notices will inform WENNING and the WENNING Consultants of a reasonable milestone date by when a decision must be made to prevent delays and will be accompanied by with the most accurate data possible relative to the cost and schedule impact of the decision item. Where the decision may involve an increase in the Contract Sum (as defined herein) or in the Contract Time (as defined herein), the SIONIX notice will specify the anticipated cost and schedule impact sufficiently to permit an informed and reasoned judgment. If the parties disagree as to the time impact, but agree to all other terms of the change, the change order shall provide that the change is without prejudice to the right of either party to seek resolution of the disagreement pursuant to ARTICLE 10 hereof.

3.1.4 KEY PERSONNEL. SIONIX has designated, and WENNING has approved, the following members of the SIONIX management team for the MWTS Project (collectively, "Key Personnel") as listed on Exhibit "G," attached hereto and incorporated herein by reference, and they shall be assigned to spend as much time as is necessary to perform such duties. SIONIX hereby advises WENNING that installation, start-up, commissioning, and training on the SIONIX MTWS is contractually delegated to Perc Water Corporation ("PERC") and that Key Personnel from PERC have yet to be designated.  As soon as practical after the execution of this Agreement, SIONIX shall advise WENNING the names and positions of PERC personnel assigned to the MWTS Project subject to WENNING approval, such approval shall not be unreasonably withheld, and shall revise Exhibit "G" accordingly. SIONIX will not cause, suffer or permit the re-assignment, removal or replacement by it, or by PERC, of any of the Key Personnel identified above without WENNING's prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. WENNING's approval of replacement personnel may be conditioned upon WENNING's satisfaction that the designated replacement is at least as well qualified by training, education and experience as the person to be replaced.  SIONIX shall promptly remove and replace any of its employees with persons reasonably acceptable to WENNING upon written request of WENNING, if such individual is disorderly or if in WENNING's reasonable opinion, such individual is otherwise incapable of fulfilling its responsibilities. During the performance of installation, from the initial mobilization and thereafter, SIONIX shall maintain continuously at the Site adequate management, supervisory, administrative, security, engineering and technical personnel to ensure expeditious and competent handling of all matters related to the Work.

  

  

  

3.2 BASIC SERVICES

3.2.1 BASIC SERVICES. The SIONIX Basic Services shall include those described in ARTICLE 14 and Section 3.2.1 hereof.  SIONIX Basic Services for the Work shall include the following distinct elements:

3.2.1.1. SIONIX Design Services. Subject to Section 8.5 hereof, this element of the Work includes all design, configuration, and component specification for the SIONIX MWTS utilizing that degree of care and skill ordinarily exercised by members of the same profession currently practicing under similar circumstances and in accordance with the Contract Documents.

3.2.1.2. SIONIX Manufacturing, Fabrication and Assembly Services. Subject to Section 8.5 hereof, this element of the Work includes all manufacturing, fabricating and assembly services, necessary for the timely and proper manufacture and assembly of the SIONIX MWTS in accordance with all applicable Contract Documents, permits, applicable laws, and this Agreement up until the SIONIX MWTS has been delivered to a common carrier for delivery to the installation Site.

3.2.1.3. SIONIX Installation Services. Subject to Section 8.5 hereof, this element of the Work includes installation, startup, commissioning and training services of the SIONIX MWTS on Site. Commencement of Installation shall occur as defined in Section 4.2 herein or as otherwise complies with a startup plan approved by the WENNING's. The parties acknowledge the Commencement of Installation may vary based on availability of influent flow.  During the SIONIX MWTS startup period, SIONIX shall furnish an Operating and Maintenance Manual in form and substance reasonably consistent with industry standards. Installation Services during construction shall include the preparation of necessary clarifications and revisions to the Contract Documents by designated Key Personnel; review of specifications; responding to requests for information; collecting, reviewing and forwarding to WENNING all guarantees, warranties and operating manuals to be submitted by SIONIX or its subcontractors or vendors under this Agreement or specifications for the SIONIX MWTS; signing certificates of Substantial Completion and Final Completion and otherwise facilitating the timely performance of the Installation Services.

3.2.2 PAYMENT OF COSTS AND EXPENSES. Unless otherwise provided in the Contract Documents, WENNING shall provide or cause to be provided and shall pay for water, heat, utilities, transportation and other facilities and services necessary for proper execution and completion of the Installation Services, whether temporary or permanent and whether or not incorporated or to be incorporated in the Work.

3.2.3 METHOD OF PERFORMANCE. SIONIX shall be responsible for all installation means, methods, techniques, sequences and procedures, and for coordinating all portions of the Installation Services under this Agreement.

3.2.4 UPDATES TO WENNING. SIONIX shall keep WENNING informed of the progress and quality of the Work.

3.2.5  PRODUCT WARRANTY. The SIONIX warranty governing this Agreement is attached hereto and incorporated herein as Exhibit "H."

  

  

  

3.2.6 TRANSACTION PRIVILEGE TAXES: SPECULATIVE BUILDER TAXES. WENNING shall pay all prime contractor transaction privilege sales, consumer, use and similar taxes provided in this Section. WENNING shall indemnify, defend and hold harmless SIONIX and its officers, directors, employees, agents, representatives, affiliates and agents (individually, a "SIONIX Indemnified Party" collectively the "SIONIX Indemnified Parties") for, from and against any and all third party claims, demands, causes of action, liabilities, damages (excluding consequential and punitive damages to the extent imposed on SIONIX), judgments, penalties, settlements and all other losses arising from WENNING's failure to timely and fully pay the Privilege Taxes and all attorneys' fees, consultants' fees, court costs (whether or not taxable by statute), and expenses incurred by each SIONIX Indemnified Party.

3.2.7 COMPLIANCE WITH LAWS. SIONIX shall comply with and give notices required by laws, ordinances, rules, regulations and lawful orders of public authorities relating to the MWTS Project. Subject to Section 8.5 hereof, SIONIX shall comply with all federal, state, county, town and local statutes, rules, regulations, ordinances, executive orders and other legislative or executive requirements, applicable to the Work and all applicable laws with respect to the SIONIX MWTS, including, but not limited to those pertaining to building permits, occupational health, safely, building codes, construction standards, and licensure applicable to the Installation Services necessary for the installation of the SIONIX MWTS.  Specifically excluded are those liquid or solid wastes and/or hazardous wastes, generated by the normal operation of the SIONIX MWTS, which are the sole and exclusive responsibility of WENNING. SIONIX shall incorporate this provision in all subcontracts and hereby assumes responsibility for the compliance of its subcontractors with said laws. Nothing in this Section 3.2.7 shall be deemed to limit the SIONIX right to give notice and to submit claims for concealed conditions as provided in Section 8.5 hereof.

3.2.8 CLEAN SITE. SIONIX shall keep the Site and surrounding area free from accumulation of waste materials or rubbish caused by the Installation Services under this Agreement. At the completion of the Installation Services, SIONIX shall remove from the Site waste materials, rubbish, SIONIX tools, construction equipment, machinery, and surplus materials.

3.3 ADDITIONAL SERVICES. The services described in this Section 3.3 shall be compensated only if the proposed Additional Services and the SIONIX compensation therefore are authorized in writing by WENNING before the services are provided. Additional Services include:  (i) making revisions in drawings, specifications, and other documents or electronic data when such revisions are required by the enactment or revisions of applicable laws after the date of execution of this Agreement; (ii) providing consultation concerning replacement of the Work damaged by fire or other cause during construction, and furnishing services required in connection with the replacement of such Work; (iii) providing services in connection with a public hearing, (except for appearance at hearings held in connection with permit applications) arbitration proceeding or legal proceeding, except where SIONIX is a party thereto; (iv) providing coordination of construction performed by WENNING's own forces or separate contractors employed by WENNING and coordination of services required in connection with construction performed and equipment supplied by WENNING; and (v) providing services for exercising of the SIONIX MWTS in the event there is insufficient wastewater influent for the Commencement of Startup.

ARTICLE 4 - TIME

4.1 TIMELY PERFORMANCE. Unless otherwise indicated, WENNING and SIONIX shall perform their respective obligations as expeditiously as is consistent with reasonable skill and care and the orderly progress of the MWTS Project.

  

  

  

4.2 COMMENCEMENT OF INSTALLATION. Time limits stated in the Contract Documents are of the essence. The Installation Services to be performed under this Agreement as part of the Work shall commence upon the Installation Commencement Date, unless otherwise agreed, subject to authorized modifications. The "Installation Commencement Date" shall be the date on which all components constituting the SIONIX MWTS are delivered to the Site and when WENNING has provided the SIONIX MWTS sufficient influent flow from WENNING equipment to allow startup of the SIONIX MWTS (the SIONIX MWTS requires a minimum and continual flow of one hundred fifty thousand (150,000) gallons per day).

4.4 SUBSTANTIAL COMPLETION. "Substantial Completion" shall mean the date when all of the following events have been accomplished and verified by the WENNING Representative: (i) the SIONIX MWTS has been completed in accordance with all applicable plans, specifications and Contract Documents; and (ii) SIONIX has successfully completed the "Acceptance Testing" in accordance with Table A2.1 and Table A2.2 of Exhibit "C," except as those standards are modified by Exhibit "D" and certified by a qualified laboratory selected by SIONIX and consented to by WENNING; provided, however if under test, any portion of the Work should fail and require equipment adjustment, alteration, or replacement, the Acceptance Test shall be repeated until such Acceptance Testing has been successful.

4.5 FINAL COMPLETION. "Final Completion" shall mean the date after Substantial Completion when all of the following events have been accomplished for the SIONIX MWTS: (i) Certification of the Acceptance Testing has been received by WENNING; (ii) a letter certifying Final Completion has been received by WENNING from SIONIX; (iii) SIONIX has submitted the final configuration drawings and flow charts and component warranties in hard copy and PDF format; and (iv) SIONIX has submitted the O&M Manual to WENNING.

4.6 EXCUSABLE DELAY.  If SIONIX is delayed at any time in the progress of the Work by an act or neglect of WENNING, WENNING's employees, or separate contractors employed by WENNING, or by changes ordered in the Work that were not caused or required by deficiencies or discrepancies in the SIONIX MWTS design, or by union labor disputes, fire, unusual delay in deliveries, adverse weather conditions not reasonably anticipatable, unavoidable casualties or by any other causes that are not caused by or do not result from default by SIONIX, or by any other cause that SIONIX could not reasonably control, or by delay authorized by WENNING pending arbitration, or by other causes which WENNING and SIONIX agree may justify delay (each an "Excusable Delay''), then the Contract Time shall be reasonably extended by Change Order.

4.7 SCHEDULE IMPACT OF CHANGE ORDERS. When Change Orders are initialed by WENNING, or SIONIX desires to revise the Construction Schedule, SIONIX shall submit to WENNING a written analysis illustrating the effect of each Change Order on the scheduled Substantial Completion Date and other material milestones for completion of the Work. In the event the parties agree on all terms of the Change Order except for its impact on the Contract Time, the Change Order shall state that the Work will proceed without waiver of the right of either party to submit the disagreement over its impact on the Contract Time to mediation and arbitration as provided in ARTICLE 10 hereof.

4.8 NOTICE OF DELAY. If SIONIX wishes to make a claim for an increase in the Contract Sum or an extension of the Contract Time on account of a delay in the Work, written notice thereof shall be given to WENNING promptly, but not later than seven (7) days after the occurrence of the event giving rise to such claim: otherwise the claim shall be waived.

  

  

  

ARTICLE 5 - PAYMENTS

5.1 PAYMENT.  Payment for the SIONIX MWTS is defined in Exhibit "A."

5.2 TITLE. SIONIX warrants that title to the SIONIX MWTS will pass to WENNING no later than the time of "Final Payment." SIONIX further warrants that upon submittal of the Final Payment the SIONIX MWTS shall be free and clear of liens, claims, security interests or encumbrances in favor of SIONIX or any other person or entity performing construction at the Site or furnishing materials or equipment relating to the construction.

5.3 WAIVER OF THE SIONIX CLAIMS. Acceptance of the Final Payment shall constitute a waiver of all claims by SIONIX except those previously made in writing and identified by SIONIX as unsettled at the time of the Final Payment.

5.2 INTEREST PAYMEMTS. Payments due SIONIX under this Agreement which are not paid when due shall bear interest from the date due at the rate specified in ARTICLE 13, or in the absence of a specified rate, at the legal rate prevailing where the MWTS Project is located.

ARTICLE 6 - PROJECTION OF PERSONS AND PROPERTY

6.1 SAFETY PRECAUTIONS. SIONIX shall be responsible for initiating, maintaining and providing Supervision of all safety precautions and programs in connection with the performance of this Agreement.

6.2 PROTECTION OF PERSONS AND PROPERTY. SIONIX shall take reasonable precautions for the safety of, and shall provide reasonable protection to prevent damage, injury or loss to:  (i) employees on the Work and other persons who may be affected thereby; (ii) the Work and materials and equipment to be incorporated therein, whether in storage on or off the Site, under care, custody, or control of SIONIX or SIONIX Subcontractors; and (iii) other property at or adjacent thereto, such as trees, shrubs, lawns, walks, pavements, roadways, structures and utilities not designated for removal relocation or replacement in the course of construction.

6.3 SAFETY NOTICES. SIONIX shall give notices required by applicable laws, ordinances, rules, regulations and lawful orders of public authorities bearing on the safety of persons or property or their protection from damage, injury or loss.

6.4 REPAIR OF PROPERTY DAMAGE. SIONIX shall promptly remedy damage and loss (other than damage or loss insured under property insurance provided or required by the Contract Documents) to property at the Site caused in whole or in part by SIONIX, a subcontractor of SIONIX or anyone directly or indirectly employed by any of them, or by anyone for whose acts they may be liable.

ARTICLE 7 - INSURANCE

7.1 SIONIX LIABILITY INSURANCE

7.1.1 GENERAL INSURANCE. SIONIX shall purchase from and maintain, in a company or companies lawfully authorized to do business in the jurisdiction in which the MWTS Project is located, insurance in accordance with the provisions of Schedule I attached hereto and incorporated herein by reference.

  

  

  

7.1.2 CERTIFICATES OF INSURANCE. Certificates of insurance acceptable to WENNING shall be delivered to WENNING that will confirm that the requirements set forth in Schedule I attached hereto have been met.

7.2 WENNING'S INSURANCE

7.2.1 LIABILITY INSURANCE. WENNING shall not be responsible for purchasing and maintaining any liability insurance.

7.2.2 PROPERTY AND CASUALTY INSURANCE. WENNING shall not be required to purchase or maintain any property or casually insurance with respect to the Site or the SIONIX MWTS; provided, however, that WENNING acknowledges that the property and casualty insurance to be provided by SIONIX with respect to the Site and the SIONIX MWTS as required herein shall expire and be of no further force and effect as of the date of Acceptance and the risk of loss for the Site and the SIONIX MWTS shall thereafter be the responsibility of WENNING.

7.3 OTHER INSURANCE PROVISIONS

7.3.1 WAIVER OF SUBROGATION. To the extent it does not affect the applicable insurance coverage, WENNING and SIONIX waive all rights against each other and other design professionals, contractors, subcontractors, agents and employees, each of the other, for damages caused by fire or other perils to the extent builder's risk insurance proceeds are obtained pursuant to this Section 7.3 or other builder's risk insurance applicable to the Work, except such rights as they may have to proceeds of such insurance held by WENNING as trustee. WENNING or SIONIX, as appropriate, shall require from contractors and Subcontractors by appropriate agreements, written where legally required for validity, similar waivers each in favor of other parties enumerated in this Section 7.3. The policies shall provide such waivers of subrogation by endorsement or otherwise. A waiver of subrogation shall be effective as to a person or entity even though that person or entity would otherwise have a duty of indemnification, contractual or otherwise, did not pay the insurance premium directly or indirectly, and whether or not the person or entity had an insurable interest in the properly damaged.

7.3.2 ADJUSTMENT OF CLAIMS. WENNING as trustee shall have power to adjust and settle a loss with insurers.

7.4 LOSS OF USE OF INSURANCE. WENNING, at WENNING's option, may purchase and maintain such insurance as will insure WENNING against loss of use of WENNING's property due to fire or other hazards, however caused. WENNING waives all rights of action against SIONIX for loss of use of WENNING's property, including consequential losses due to fire or other hazards, however caused.

ARTICLE 8 - CHANGES IN THE WORK

8.1 CHANGES

8.1.1 CHANGES IN THE WORK. Except for materially changing the capacity of the SIONIX MWTS, changes in the Work may be accomplished after execution of this Agreement, without invalidating this Agreement by Change Order.

8.1.2 DESCRIPTION. A Change Order shall be based upon agreement between WENNING and SIONIX.

  

  

  

 

8.1.3 SUBJECT TO CONTRACT DOCUMENTS. Changes in the Work shall be performed under applicable provisions of the Contract Documents, and SIONIX shall proceed promptly, unless otherwise provided in the Change Order.

8.2 CHANGE ORDERS

8.2.1 DEFINITION. A Change Order is a written instrument prepared by SIONIX and signed by WENNING stating their agreement upon all of the following:  (i) a change in the Work; (ii) the amount of the adjustment, if any, in the Contract Sum; and (iii) the extent of the adjustment, if any, in the Contract Time.

8.2.2 CANCELLATION OF CHANGE ORDER REQUEST. If WENNING requests a proposal for a change in the Work from SIONIX and subsequently elects not to proceed with the change, a Change Order shall be issued to reimburse SIONIX for any costs incurred for estimating services, design services or preparation of proposed revisions to the Contract Documents.

8.3 CONSTRUCTION CHANGE DIRECTIVES

8.3.1 DEFINITION. A Construction Change Directive is a written order prepared and signed by WENNING, directing a change in the Work prior to agreement on adjustment, if any, in the Contract Sum or Contract Time, or both.

8.3.2 DETERMINATION OF ADJUSTMENT. Except as otherwise agreed by WENNING and SIONIX, the adjustment to the Contract Sum shall be determined in accordance with Section 13.1.2 hereof, taking into account any savings attributable to the change in the Work; provided, however, that SIONIX shall not be entitled to reimbursement for costs due to the negligence or failure to fulfill a specific responsibility under this Agreement of SIONIX or of any of its Subcontractors or any person or entity for whom SIONIX is responsible.

8.3.3 INTERIM PAYMENTS. Pending final determination of cost to WENNING, amounts not in dispute shall be paid in full upon execution of the Change Order or Directive. The amount of credit to be allowed by SIONIX to WENNING for deletion or change which results in a net decrease in the Contract Sum will be actual net cost. When both additions and credits covering related Work or substitutions are involved in a change, the allowance for overhead and profit shall be figured on the basis of the net increase, if any, with respect to that change.

8.3.4 FINAL AGREEMENT. When WENNING and SIONIX agree upon the adjustments in the Contract Sum and Contract Time, such agreement shall be effective immediately and shall be recorded by preparation and execution of an appropriate Change Order.

8.4 MINOR CHANGES IN THE WORK. SIONIX shall, with the written approval of WENNING, have authority to make minor changes in the Construction Documents and the Work consistent with the intent of the Contract Documents when such minor changes do not involve adjustment in the Contract Sum or extension of the Contract Time or any change in the Work that would require other government approval or affect performance of the SIONIX MWTS. SIONIX shall promptly inform WENNING, in writing, of minor changes in the Construction Documents and the Work and obtain WENNING's approval therefore.

  

  

  

8.4 CONCEALED CONDITIONS. If conditions are encountered at the Site which are:  (i) subsurface or otherwise concealed physical conditions which differ materially from those indicated in the Contract Documents, or (ii) unknown physical conditions of an unusual nature which differ materially from those ordinarily found to exist and generally recognized as inherent in construction activities of the character provided for in the Contract Documents, then notice by the observing party shall be given to the other party promptly before conditions are disturbed and in no event later than five (5) days after first observance of the conditions. The Contract Sum shall be equitably adjusted for such concealed or unknown conditions by Change Order upon claim by either party made within five (5) days after the claimant becomes aware of the conditions.

8.5 REGULATORY CHANGES. SIONIX shall be appropriately compensated for changes in the event SIONIX incurs an increase in the cost of design and construction necessitated by the enactment or revisions of applicable laws after the date of this Agreement. The amount of such compensation shall be determined by the principles set forth in Section 8.3.2 hereof.

ARTICLE 9 - CORRECTION OF WORK

9.1 WORK TO BE CORRECTED. SIONIX shall promptly correct Work rejected by WENNING or known by SIONIX to be defective or failing to conform to the requirements of the Contract Documents, whether observed before Substantial Completion, or after Substantial Completion if still covered by the warranty set forth in Section 3.2.5 hereof, and whether or not fabricated, installed or completed. SIONIX shall bear costs of correcting such rejected Work, including additional testing and inspections.

9.2 TIME FOR CORRECTION. Except with respect to effluent levels and without limiting any liability or obligations SIONIX may otherwise have to WENNING under any statute or applicable law if within the greater of: (i) the Construction Warranty Period, as extended pursuant to Section 3.2.5 hereof, if applicable; or (ii) the time provided by terms of an applicable special warranty required by the Contract Documents or provided by the manufacturer of any equipment, any of the Work is found to be not in accordance with the requirements of the Contract Documents, SIONIX shall correct it promptly after receipt of a written notice from WENNING to do so, within the time for correction specified by WENNING in such notice (no less than fourteen (14) days), at no cost to WENNING, unless WENNING has previously given SIONIX a written acceptance of such condition. If SIONIX fails to correct the deficient element of the Work within the time given in such notice, WENNING may perform the corrective work and SIONIX shall pay WENNING, upon demand, the reasonable costs WENNING incurred for such correction.

9.3 EFFECT OF TIME PERIODS. Nothing contained in this ARTICLE 9 shall be construed to establish a period of limitation or a limitation of any liability or obligation with respect to other obligations which the SIONIX might have under the Contract Documents or applicable law. Establishment of the time periods as described in Section 9.2 relates only to the specific obligation of the SIONIX to correct the Work, and has no relationship to the time within which the obligation to comply with the Contract Documents or applicable law may be sought to be enforced, nor to the time within which proceedings may be commenced to establish the SIONIX's liability with respect to the SIONIX's obligations other than specifically to correct the Work.

9.4 RIGHT TO STOP WORK. If SIONIX fails to correct nonconforming Work after receipt of a notice from WENNING, or fails to carry out the Work in accordance with the Contract Documents or, subject to Section 8.5 hereof, applicable Law, WENNING, by written order signed personally or by an agent specifically so empowered by WENNING in writing, may order SIONIX to stop the Work, or any portion thereof, until the cause for such order has been eliminated; provided, however, that WENNING's right to stop the Work shall not give rise to a duty on the part of WENNING to exercise the right for benefit of the SIONIX or other persons or entities.

  

  

  

9.5 RIGHT TO CURE. If SIONIX defaults or neglects to carry out any part of the Work in accordance with the Contract Documents and fails within seven (7) days after receipt of written notice from WENNING to commence and continue correction of such default or neglect with diligence and promptness, WENNING may, without prejudice to other remedies WENNING may have, correct such deficiencies. In such case an appropriate Change Order shall be issued deducting from payments then or thereafter due SIONIX, the costs of correcting such deficiencies. If the payments then or thereafter due SIONIX are not sufficient to cover the amount of the deduction, SIONIX shall pay the difference to WENNING. Such action by WENNING shall be subject to dispute resolution procedures as provided in ARTICLE 10 hereof.

ARTICLE 10 - DISPUTE RESOLUTION

10.1 MEDIATION. Claims, disputes or other matters in question between the parties to this Agreement arising out of or relating to this Agreement or breach thereof shall be subject to and decided through mediation by the Chief Executive Officers of the parties hereto.  A demand for mediation shall be made within a reasonable time after the claim, dispute or other matter in question has arisen. In no event shall the demand for mediation be made after the date when institution of legal or equitable proceedings based on such claim, dispute or other matter in question would be barred by the applicable statutes of repose or limitations.

10.2 JUDICIAL ACTION. In the event claims, disputes or other matters in question between the parties to this Agreement cannot be settled by Mediation between the Chief Executive Officers of the parties and legal action is initiated, the parties hereto specifically agree such filings will be conducted in accordance with the following protocol:

10.2.1 VENUE PREFERENCE AND JURISDICTION.  The Complaining Party to this Agreement initiating legal action against the Non-Complaining Party to this Agreement must file such action in the Federal Court presiding in the jurisdiction of the Non-Complaining Party.  Each party to this Agreement hereby accepts the exclusive personal jurisdiction and venue preference of the Non-Complaining Party.

 

 

10.2.2 GOVERNING LAW.  This Agreement shall be governed by the laws of the State of Delaware without reference to conflict of law provisions.

10.3 ATTORNEYS' FEES. The prevailing party in any litigation arising from this Agreement shall be entitled to its reasonable attorneys' fees, court costs, expert fees, and other reasonable expenses incurred.

ARTICLE 11 - MISCELLANEOUS PROVISIONS

11.1 SUBCONTRACTS

11.1.1 LIST OF SUBCONTRACTORS. SIONIX, as soon as practicable after execution of this Agreement, shall furnish to WENNING in writing the names of the persons or entities SIONIX has or will engage as contractors and Subcontractors for the MWTS Project.

  

  

  

11.1.2 SUBCONTRACTS FOR PROFESSIONAL SERVICES AND FOR CONSTRUCTION SERVICES.All of the SIONIX agreements with engineers, other design professionals and consultants, subcontractors, suppliers, materialmen, and other vendors shall be consistent with and materially similar to this Agreement, specifically providing for assignability to WENNING in the event this Agreement is terminated by WENNING for cause against SIONIX.

11.2 WORK BY WENNING OR WENNING'S CONTRACTORS

11.2.1 OPTION OF WENNING. WENNING reserves the right to perform construction or operations related to the MWTS Project but not within the scope of the Work undertaken by SIONIX with WENNING's own forces, and to award separate contracts in connection with other portions of the MWTS Project or other construction or operations on the Site under conditions of insurance and waiver of subrogation identical to the provisions of (his Agreement. If SIONIX claims that delay or additional cost is involved because of such action by WENNING, SIONIX shall assert such claims as provided in Section 11.3 hereof.

11.2.2 COORDINATION. SIONIX shall afford WENNING's separate contractors reasonable opportunity for introduction and storage of their materials and equipment and performance of their activities and shall connect and coordinate the SIONIX construction and operations within theirs as required by the Contract Documents.

11.2.3 ADDITIONAL COSTS. Costs caused by delays or by improperly timed activities or defective construction shall be borne by the party responsible.

11.3 CLAIMS FOR DAMAGES. If either party to this Agreement suffers injury or damage to person or property because of an act or omission of the other party, of any of the other party's employees or agents, or of others for whose acts such party is legally liable, written notice of such injury or damage, whether or not insured, shall be given to the other party within a reasonable time not exceeding ten (10) days after first observance. The notice shall provide sufficient detail to enable the other party to investigate the matter. If a claim of additional cost or time related to this claim is to be asserted, it shall be filed in writing.

11.4 INDEMNIFICATION

11.4.1 SIONIX INDEMNITY. To the fullest extent permitted by Law SIONIX shall indemnify, defend and hold harmless WENNING and its officers, directors, employees, agents, representatives, affiliates and agents (individually, an "Indemnified Party" and collectively the "Indemnified Parties") for, from and against any and all third party claims, demands, causes of action, damages (excluding consequential and punitive damages), judgments, penalties, settlements and all other losses arising from the performance or nonperformance of this Agreement (hereinafter individually or collectively referred to as a '"Claim" or '"Claims") and all attorneys' fees, consultants' fees, court costs (whether or not taxable by statute), and expenses incurred by each Indemnified Party. This indemnity is in addition to and shall not be deemed to limit any other indemnity given by SIONIX, and extends to the maximum extent permitted by Law and includes, but is not limited to any Claim, just or unjust, of any kind, nature or description whatsoever, whether sounding in a tort, warranty, contract (including breach of this Agreement), equity, a statute, or any other theory of liability, and whether the Claim is based on an alleged death, personal injury, sickness, conversion, breach of warranty (express or implied), breach of representation, defective work not remedied, lien, stop notice, property damage (including property damage to the Work), patent infringement, copyright infringement, loss of use and all other direct economic loss, release of a petroleum byproduct or other substance regulated by applicable Law, legal violations or other claimed damage. This indemnity shall apply even if the Claim results in part from an Indemnified Party's negligently or knowingly acting or failing to act, but in that event the Indemnified Party shall not be indemnified for that portion of the Claim that results from its negligently or knowingly acting or failing to act, it being expressly understood that an Indemnified Party's failure acting or failing to act in reliance on promises, representations or agreements made by SIONIX in the performance of the Work shall not be considered negligently or knowingly acting or failing to act by an Indemnified Party.

  

  

  

11.4.2 EMPLOYEE INDEMNIFICATION. In claims against any person or entity indemnified under this Agreement by an employee of SIONIX, anyone directly or indirectly employed by SIONIX or anyone for whose acts SIONIX may be liable, the indemnification obligation under this Section 11.4 shall not be limited by a limitation on amount or type of damages, compensation or benefits payable by or for SIONIX under workers' compensation acts, disability benefit acts or other employee benefit acts.

11.5 SUCCESSORS AND ASSIGNS. An assignee shall have all of the rights and duties of WENNING with respect to the subject matter of the assignment. WENNING may assign all of its right, title, interest, obligations and duties under the Agreement to an affiliate of WENNING without SIONIX' prior written consent, so long as WENNING is not relieved from liability under the Agreement.  Any other assignment of the obligations under this Agreement must be agreed to by the non-assigning party in writing, said assignment will not unreasonably be withheld, subject only to a strict prohibition on assignment by WENNING to a current or potential competitor of SIONIX.

11.6 EXTENT OF AGREEMENT. This Agreement, together with all Contract Documents, Schedules and Drawings attached hereto represent the entire agreement between WENNING and SIONIX and supersede all prior negotiations, representations or agreements, either written or oral. This Agreement may be amended only by written instrument and signed by both WENNING and SIONIX.

ARTICLE 12 - TERMINATION OF THE AGREEMENT

 

 

12.1 TERMINATION BY WENNING

12.1.1 ABANDONMENT. This Agreement may be terminated by WENNING upon fourteen (14) days' written notice to SIONIX in the event that the MWTS Project is abandoned. If such termination occurs, WENNING shall pay SIONIX for the Work completed and for proven loss sustained upon materials, equipment, tools, and construction equipment and machinery, including reasonable profit and applicable damages.

12.1.2 DEFAULT. If SIONIX fails or neglects to carry out any part of the Work in accordance with the Contract Documents or fails to perform any of its obligations or duties under this Agreement, WENNING may give written notice specifying the failure or neglect. SIONIX shall have seven (7) days thereafter within which to either cure the default or to obtain WENNING's written approval of a plan for accomplishing cure by such later dale as the parties may agree, which approval of the plan and later date for accomplishing cure will not be unreasonably withheld or delayed by WENNING. SIONIX shall be in default if it fails to correct the defaults, failure or neglect within seven (7) days after being given such notice to cure the default or obtain WENNING's approval of a plan for cure within seven (7) days after being given such notice or if SIONIX, having timely received WENNING's approval of a plan of cure, fails to continuously and diligently pursue cure to completion in accordance with such approved plan In the event of the SIONIX default, WENNING may, without prejudice to any other remedy and without further notice, terminate this Agreement and take possession of the Site and of all materials, equipment, tools and construction equipment and machinery thereon owned by SIONIX and finish the Work and perform all applicable warranty work by whatever method WENNING may deem expedient. If the unpaid balance of the Contract Sum exceeds the expense of finishing the Work and all damages incurred by WENNING, such excess shall be paid to SIONIX. If the expense of completing the Work and performing the warranty work incurred by WENNING exceeds the unpaid balance, SIONIX shall pay the difference to WENNING. This obligation for payment shall survive termination of this Agreement. This ARTICLE 12 shall not limit any other rights or remedies of WENNING.

  

  

  

12.2 TERMINATION BY SIONIX. If WENNING fails to make any uncontested payment when due, SIONIX may give written notice of intention to suspend or terminate this Agreement. If SIONIX fails to receive the uncontested payment within seven (7) days after receipt of such notice by WENNING, SIONIX may terminate this Agreement and recover from WENNING payment for the Work executed and for proven losses sustained upon materials, equipment, tools, and construction equipment and machinery, including reasonable profit and applicable damages.

ARTICLE 13 - BASIS OF COMPENSATION

WENNING shall compensate the SIONIX in accordance with ARTICLE 5 hereof, and the other provisions of this Agreement as described below.

13.1         COMPENSATION. For the SIONIX performance of the Work, as described in Section 3.2 hereof and including any other services listed in ARTICLE 14 hereof as part of Basic Services, WENNING shall pay the SIONIX in current funds the Contract Sum as follows:  (i) the Contract Sum for the SIONIX MWTS shall be the lump sum of $1,428,500 allocated and paid in accordance with Exhibit "A," shall be SIONIX' total compensation for all components of Design Services, Construction Services (including procurement and installation of equipment), Startup, Testing, and all other Work necessary for the performance of the SIONIX obligations to timely and properly complete the SIONIX MWTS, and all costs incurred by SIONIX in connection therewith, whether or not the component (or cost thereof) is specifically referred to in this Agreement, save and except only components (or costs) that are specifically identified in this Agreement and the Outline Specifications as exclusions from the Work to be performed for the Contract Sum; and (ii) in the event the parties agree that any additional components of the SIONIX MWTS are to be performed, they shall execute an appropriate Change Order incorporating such components in the Work, with compensation for such additional components to be determined on the basis of the SIONIX standard pricing policies.

13.1.2                 ADDITIONAL SERVICES. For Additional Services, as described in Section 3.3 hereof and including any other services listed in ARTICLE 14 hereof as Additional Services for Change Orders as described in Section 3.2 hereof.

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13.2 REIMBURSABLE EXPENSES. Reimbursable Expenses are in addition to the compensation for Basic and Additional Services, and include actual expenditures made by SIONIX and SIONIX employees and contractors in the interest of the MWTS Project (the "Reimbursable Expenses"). SIONIX' reimbursable expenses shall be limited to the actual cost incurred plus ten percent (10%) for overhead and profit (not to exceed Fifteen Thousand Dollars ($15,000) in the aggregate) for costs to reproduce more than one (1) copy of any final set of plans or final report prepared by SIONIX and any necessary fees paid by SIONIX to governmental agencies for permits or approvals. There shall be no markup for taxes, additional insurance, and permits.

  

  

  

ARTICLE 14 - OTHER CONDITIONS AND SERVICES

14.1         TIME FOR PERFORMANCE OF THE WORK. The Installation Services to be performed shall be commenced upon the Installation Commencement Date and, subject to authorized adjustments and delays not caused by SIONIX. Final Completion shall be achieved by the respective dates established in the Construction Schedule, attached hereto and incorporated herein as Schedule "1."

14.2 SIONIX REPRESENTATIONS AND WARRANTIES.                                                                                                           SIONIX hereby represents and  warrants:  (i) it is duly organized, validly existing, and in good standing under the laws of Nevada, and has the requisite power and authority to own carry on its business as now conducted; (ii) has the requisite power and authority to enter into this Agreement and to carry out its obligations hereunder, and the execution and delivery of this Agreement by SIONIX and the consummation of the transactions contemplated hereby have been duly authorized, and no other corporate proceedings on the part of SIONIX is necessary to authorize this Agreement and such transactions; (iii) this Agreement has been duly executed and delivered by SIONIX and constitutes a valid and binding obligation enforceable in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, or other similar laws relating to the enforcement of creditors' rights generally and by general principles of equity; (iv) it possesses the legal capacity to execute and deliver this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated hereby; (v) it is not subject to, nor obligated under any provision of its articles of incorporation or bylaws, any agreement, arrangement, or understanding, any license, franchise, or permit; or any law, regulation, order, judgment, or decree, which would be breached or violated, or in respect of which a right of termination or acceleration would arise, or pursuant to which any encumbrance on any of its assets would be created, by its execution, delivery, and performance of this Agreement and the consummation by it of the transactions contemplated hereby; (vi) except for the permits set forth on Schedule 1 attached hereto, no authorization, consent, or approval of, or filing with, any public body, court, or authority is necessary on the part of SIONIX for the consummation by SIONIX of the transactions contemplated by this Agreement; (vii) subject to Section 8.5 hereof, the treatment process for the SIONIX MWTS as set forth in the plans and specifications to be furnished by SIONIX shall be in compliance with all the then existing applicable federal, state and local rules, regulations and laws and the SIONIX MWTS shall be constructed in accordance with such plans and specifications; and (viii) except as otherwise stated herein, there are no suits, claims, actions, arbitrations, investigations, or proceedings entered against, now pending, or, to the knowledge of SIONIX, threatened against SIONIX before any court, arbitration, administrative or regulatory body, or any governmental agency nor is SIONIX subject to any continuing court or administrative order, writ, injunction, or decree and is not in default with respect to any order, writ, injunction, or decree of any court or federal, state, municipal, or other governmental department, commission, board, agency, or instrumentality.

  

  

  

14.3 WENNING'S REPRESENTATIONS AND WARRANTIES. WENNING hereby represents, warrants, and agrees as follows, to and for the benefit of the SIONIX:  (i) it is duly organized, validly existing, and in good standing under the laws of Ohio, and has the requisite power and authority to own and operate the properties and to carry on its business as now conducted; (ii) it has the requisite power and authority to enter into this Agreement and to carry out its obligations hereunder and the execution and delivery of this Agreement by WENNING and the consummation of the transactions contemplated herein have been duly authorized, and no other corporate proceedings on the part of WENNING is necessary to authorize this Agreement and such transactions; (iii) this Agreement has been duly executed and delivered by WENNING and constitutes a valid and binding obligation of WENNING enforceable in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency, reorganization, or oilier similar laws relating to the enforcement of creditors' rights generally and by general principles of equity; (iv) it possesses the legal capacity to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby; (v) it is not subject to nor obligated under any provision of its articles of incorporation or bylaws,  any agreement, arrangement, or understanding, any license, franchise, or permit, or any law. regulation, order, judgment, or decree, which would be breached or violated, or in respect of which a right of termination or acceleration would arise, or pursuant to which any encumbrance on any of its assets would be created, by its execution, delivery, and performance of this Agreement and the consummation by it of the transactions contemplated hereby, and (vi) there are no suits, claims, actions, arbitrations, investigations, or proceedings entered against, now pending, or, to the knowledge of WENNING, threatened against WENNING before any court, arbitration, administrative or regulatory body, or any governmental agency, and WENNING is not subject to any continuing court or administrative order, writ, injunction, or decree and is not in default with respect to any order, writ, injunction, or decree of any court or federal, state, municipal, or oilier governmental department, commission, board, agency, or instrumentality.

ARTICLE 15 - GENERAL PROVISIONS

15.1 LIMITATION OF LIABILITY. Notwithstanding anything to the contrary contained herein, in no event will SIONIX be liable for any damages or any liability in excess of all amounts available under the insurance coverage obtained by SIONIX as required herein.  No party shall be liable for any indirect, special, incidental or consequential damages, including without limitation, loss of profit, loss of revenue, loss of use, or for punitive damages, arising out of or in relation to the performance of this Agreement whether or not such liability is claimed in contract, equity, tort, or otherwise.

15.2 WAIVER.  Unless expressly provided herein no delay or omission by the parties hereto in exercising any right or remedy provided for herein shall constitute a waiver of such right or remedy nor shall it be construed as a bar to or waiver of any such right or remedy on any future occasion.

15.3 NOTICES.  Any notice required or authorized to be given hereunder or any other communications between the parties provided for under the terms of this Agreement shall be in writing (unless otherwise provided) and shall be served personally or by reputable express courier service or by facsimile addressed to the relevant party at the address stated below herein or at any other address notified by that part to the other as its address for service.  Any notice so given personally shall be deemed to have been served on delivery, any notice so given by express courier service shall be deemed to have been served two (2) Business Days after the same shall have been delivered to the relevant courier, and any notice so given by facsimile shall be deemed to have been served on dispatch.  As proof of such service it shall be sufficient to produce a receipt showing personal service, the receipt of a reputable courier company showing the correct address of the addressee or any activity report of the sender's facsimile machine showing the correct facsimile number of the party on whom notice is served and the correct number of pages transmitted.  The parties address for service are:

  

  

  

  

  

  

To WENNING:                                          WENNING POULTRY

1500 Union City Road

Ft. Recovery, OH 45846

Facsimile:  (419) 375-2027

Telephone:  (419) 375-4781

To SIONIX:                                  SIONIX CORPORATION

2801 Ocean Park Blvd.

Suite 339

Santa Monica, CA 90405

Facsimile:  (888) 627-9993

Telephone:  (847) 235-4566

15.4 AMENDMENTS.  This Agreement may be modified or amended only by an instrument in writing signed by all parties hereto.

15.5 ENTIRE AGREEMENT. The terms and conditions set forth herein, together with those set forth on all exhibits, schedules and drawings attached hereto, constitute the complete statement of the agreement between WENNING and SIONIX relating to the subject matter hereof.  No prior statement, correspondence or parole evidence shall modify or affect the terms and conditions hereof nor shall such prior statements, correspondence or parole evidence be introduced or considered in any judicial or arbitral proceeding.  Prior representations, promises, warranties or statements by any agent or employee of WENNING or  SIONIX that differ in any way from the terms and conditions hereof shall be given no effect.

15.6 COUNTERPARTS.  This Agreement may be executed by the parties in one or more counterparts, all of which taken together, shall constitute one and the same instrument.  Facsimile signatures shall have the same effect as original signatures.  A party delivering facsimile counterpart signature pages shall promptly thereafter deliver original counterpart signature pages.

15.7 FORCE MAJEURE.  No delay in performance by any party hereunder shall constitute a default under this Agreement if, and to the extent, such delay is caused by a Force Majeure Event.

15.8 RELATIONSHIP. This Agreement is not intended to create a partnership, franchise, joint venture, agency or a fiduciary or employment relationship.  Neither party may bind the other party or act in a manner which expresses or implies a relationship other than that of buyer and supplier.

15.9 SEVERABILITY. If any provision of this Agreement shall be held illegal or unenforceable, that provision shall be limited or eliminated to the minimum extent necessary so that this Agreement shall otherwise remain in full force and effect.

(SIGNATURE PAGE FOLLOWS)

  

  

  

IN WITNESS WHEREOF, this Agreement has been executed and delivered by the duly authorized representatives of WENNING and SIONIX as of the date first written above.

	 WENNING POULTRY, INC. 	 	 	 SIONIX CORPORATION	 
	 	 	 	 	 
	 	 	 	 	 
	
/s/James Wenning

	 	 	
/s/ James R. Currier

	 
	(Signature)	 	 	
(Signature)

	 
	
James Wenning, President 

	 	 	
James R. Currier, Chairman/CEO

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