EXHIBIT 3.2
Limited Liability
Company Agreement
LIMITED LIABILITY COMPANY AGREEMENT
OF
ILLINOIS POWER SECURITIZATION
LIMITED LIABILITY COMPANY
A DELAWARE LIMITED LIABILITY COMPANY
THIS LIMITED LIABILITY COMPANY AGREEMENT (this "Agreement") of
Illinois Power Securitization Limited Liability Company, a Delaware limited
liability company (the "Company"), is made and entered into as of September
10, 1998, by Illinois Power Company, an Illinois corporation, as the sole
member of the Company (the "Sole Member"). Pursuant to Section 18-201(d) of
the Act (as defined herein) this Agreement shall be effective as of September
10, 1998.
WHEREAS, the Sole Member has caused to be filed a Certificate of
Formation with the Secretary of State of the State of Delaware (the
"Secretary") to organize the Company under and pursuant to the Act (as herein
defined);
WHEREAS, upon the terms and subject to the conditions set forth
herein, the Sole Member is concurrently with the execution of this Agreement
acquiring a Membership Interest (as herein defined) in the Company; and
WHEREAS, in accordance with the Act, the Sole Member desires to
enter into this Agreement to set forth the respective rights, powers and
interests of the Sole Member with respect to the Company and its Membership
Interest therein and to provide for the management of the business and
operations of the Company.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained and other good and valuable consideration, the
receipt, adequacy and sufficiency of which are hereby acknowledged, the Sole
Member, intending to be legally bound, hereby agrees as follows:
ARTICLE 1
DEFINITIONS
1.1 DEFINITIONS. Except as otherwise herein expressly provided, the
following terms and phrases shall have the meanings as set forth
below:
"ACT" shall mean the Delaware Limited Liability Company Act,
6 Del. C. Sections 18-101 ET SEQ., as the same may hereafter be amended from
time to time.
"AFFILIATE" shall mean, when used with reference to a specific
Person, any other Person that, directly or indirectly, through one or more
intermediaries, Controls, is Controlled by or is under common Control with
such specific Person.
"AGREEMENT" shall mean this instrument comprising the Limited
Liability Company Agreement of the Company, as amended, modified,
supplemented or restated from time to time in accordance with this Agreement.
"BASIC DOCUMENTS" shall mean all agreements, instruments and
other documents entered into from time to time by the Company in connection
with the acquisition and sale of intangible transition property under the
Funding Law, and the issuance of transitional funding instruments by the
Company or by any assign of such intangible transition property including,
but not limited to, any Agreement Relating to Grant of Intangible Transition
Property, any Intangible Transition Property Sale Agreement, the Intangible
Transition Property Servicing Agreement, any Declaration of Trust, the
Administration Agreement and all other documents and certificates delivered
in connection therewith.
"BUSINESS DAY" shall mean any day that is not a Saturday, Sunday
or a day on which banking institutions in the State of Illinois, the State of
New York or The Depository Trust Company are authorized or obligated by law
or executive order to close.
"CAPITAL CONTRIBUTION" shall mean, with respect to the Sole
Member, the amount of cash and the initial value of any Contributed Property
(net of liabilities to which such property is subject).
"CERTIFICATE" shall mean the Certificate of Formation of the
Company originally filed with the Secretary on September 10, 1998 as
described in Section 2.1, and as further amended, modified, supplemented, or
restated from time to time.
"COMPANY" shall have the meaning assigned to such term in the
preamble hereto.
"CONTRIBUTED PROPERTY" shall mean any property or other assets,
in such form as may be permitted by the Act, but excluding cash, contributed
or deemed contributed to the Company with respect to the Membership Interest
held by the Sole Member.
"CONTROL" shall mean any of the following: (a) in the case of a
corporation, ownership, directly or through ownership of other Entities, of
at least ten percent (10%) of all the voting stock (exclusive of stock which
is voting only as required by applicable law or in the event of nonpayment of
dividends and pays dividends only on a nonparticipating basis at a fixed or
floating rate); (b) in the case of any other Entity, ownership, directly or
through ownership of other Entities, of at least ten percent (10%) of all of
the beneficial equity interests therein, (calculated by a method that
excludes from equity interests, ownership interests that are nonvoting
(except as required by applicable law or in the event of nonpayment of
dividends or distributions) and pay dividends or distributions only on a
non-participating basis at a fixed or floating rate); (c) in any case, the
ability, whether by the direct or indirect ownership of shares or other
equity interests, by contract or otherwise, to elect a majority of the
directors of a corporation, to select the managing partner of a partnership,
to select a manager of a limited liability company, or otherwise to select,
or have the power to remove and then select, a majority of those Persons
exercising governing authority over an Entity or to exercise governing
authority over
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an Entity; (d) in the case of a limited partnership, being the sole general
partner, any of the general partners to the extent each has equal management
control and authority, or the managing general partner or managing general
partners thereof; (e) in the case of a limited liability company that has one
or more managers, being a manager; or (f) in the case of a trust, being
trustee thereof or any Person having the right to select any such trustee
without the consent of any other Person.
"ENTITY" shall mean any general partnership, limited partnership,
limited liability company, corporation, joint venture, foundation, trust,
business trust, real estate investment trust or association.
"EVENT OF BANKRUPTCY" shall mean, with respect to any Person,
that such Person shall (a) institute proceedings to be adjudicated bankrupt
or insolvent, (b) consent to the institution of bankruptcy or insolvency
proceedings against it, (c) file a petition seeking or consent to
reorganization or relief under any applicable federal or state law relating
to bankruptcy, (d) consent to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of such Person or
a substantial part of its property, (e) make a general assignment for the
benefit of creditors or (f) admit in writing its inability to pay its debts
generally as they become due.
"FUNDING LAW" shall mean the Electric Utility Transitional
Funding Law of 1997, 220 ILCS 5/18-101 ET SEQ.
"GAAP" shall mean generally accepted accounting principles in
effect in the United States from time to time.
"ILLINOIS POWER AFFILIATED GROUP" shall mean the Sole Member,
Illinova Corporation, an Illinois corporation and any Affiliate of such
companies (other than the Company).
"INDEPENDENT MANAGER" shall mean a natural person who is familiar
with and has experience with asset securitization and is not at the time of
appointment, has not been at any time preceding such appointment and is not
during the term of such appointment (other than as incidental to such
person's role as Independent Manager): (a) a member, stockholder, partner,
director, manager, officer or employee of any member of the Illinois Power
Affiliated Group; (b) a customer, supplier or other person who derives more
than ten percent (10%) of its purchases or revenues from its activities with
the Company or any member of the Illinois Power Affiliated Group; or (c) a
member of the family of any such member, stockholder, partner, director,
manager, officer, employee, customer or supplier.
"INTANGIBLE TRANSITION PROPERTY" shall have the meaning specified
in Section 2.3.
"MANAGEMENT AGREEMENT" shall mean the agreement of the members of
the Management Committee in the form attached hereto as Exhibit B. The
Management Agreement shall be deemed incorporated into, and part of, this
Agreement.
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"MANAGEMENT COMMITTEE" shall mean a committee formed upon or
prior to the acquisition by the Company of Intangible Transition Property and
composed of not less than three nor more than five individuals, at least one
of whom at all times must qualify as an Independent Manager. The Company
shall be without authority to take the actions specified herein as requiring
the vote or consent of the Management Committee absent the currently
effective appointment of an Independent Manager to the Management Committee.
"MANAGER" shall mean a member of the Management Committee.
"MEMBER" shall mean a member of the Company.
"MEMBERSHIP INTEREST" shall mean, with respect to a Member, the
limited liability company interest of the Member in the Company.
"NET CASH FLOWS" shall mean the excess of revenue over expenses
less any reserves the Management Committee considers appropriate or necessary
for the conduct of business.
"PERSON" shall mean any natural person or Entity.
"SALE AGREEMENTS" shall have the meaning specified in Section 2.3.
"SECRETARY" shall have the meaning assigned to such term in the
first recital of this Agreement.
"SOLE MEMBER" shall have the meaning assigned to such term in the
preamble hereto.
ARTICLE 2
FORMATION AND BUSINESS OF THE COMPANY
2.1 FORMATION. The Company has been organized as a Delaware limited
liability company under and pursuant to the Act by filing on
September 10, 1998, a Certificate of Formation with the Secretary
as required by the Act by Illinois Power Company, as an authorized
person under the Act. To the extent that the rights or obligations
of the Sole Member are different by reason of any provision of this
Agreement than they would be in the absence of such provision, this
Agreement shall, to the extent permitted by the Act, control.
2.2 NAME. The name of the Company shall be "Illinois Power
Securitization Limited Liability Company." The business of the
Company may be conducted under that name or, upon compliance with
applicable laws, any other name that the Sole Member deems
appropriate or advisable. The Sole Member shall cause to be filed
any fictitious name certificates and similar filings, and any
amendments thereto that the Management Committee considers
appropriate or advisable.
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2.3 PURPOSE. The purpose for which the Company is formed is limited
solely to:
(a) acquire, own, hold, administer, service or enter into
agreements regarding the receipt and servicing of "intangible transition
property" as such term is defined in the Funding Law as of the date hereof
("INTANGIBLE TRANSITION PROPERTY"), which Article is also known as the
Electric Utility Transitional Funding Law of 1997, along with certain other
related assets;
(b) manage, sell, assign, pledge, collect amounts due on or
otherwise deal with the intangible transition property and related assets to
be so acquired in accordance with the terms of the "Sale Agreements" as
defined below;
(c) enter into, perform and comply with one or more sale
agreements, assignment agreements, or other agreements providing for the sale
of the aforementioned intangible transition property and related assets
(collectively, the "SALE AGREEMENTS") and to enter into, perform and comply
with such servicing agreements, interest rate swap agreements, administration
agreements, collection account agreements and other similar agreements as may
be necessary or desirable in connection with such Sale Agreements;
(d) enter into, perform and comply with one or more declarations
of trust related to the creation of one or more Delaware business trusts to
be formed in connection with the transactions contemplated by the Sale
Agreements; and
(e) engage in any lawful act or activity and to exercise any
powers permitted to limited liability companies formed under the laws of the
State of Delaware that, in either case, are incidental to and necessary,
suitable or convenient for the accomplishment of the above-mentioned purposes.
The Company shall not engage in any activity other than in connection
with the foregoing or other than as required or authorized by the terms of
any Sale Agreements or other agreement referenced above. The Company shall
have all powers reasonably necessary or convenient to effect the foregoing
purposes, including all powers granted under the Act. The Company, and the
Sole Member or any Manager, including the Independent Manager, on behalf of
the Company, may enter into and perform the Basic Documents and all
documents, agreements, certificates or financing statements contemplated
thereby or related thereto, all without any further act, vote or approval of
any Member, Manager or other Person, notwithstanding any other provisions of
this Agreement (including Section 6.1), the Act, or other applicable law,
rule or regulation. The authorization set forth in the preceding sentence
shall not be deemed a restriction on the power and authority of the Sole
Member or any Manager, including the Independent Manager, to enter into other
agreements or documents on behalf of the Company.
2.4 PRINCIPAL OFFICE. The location of the principal place of business
of the Company shall be at such location as shall be selected from
time to time by the Sole Member.
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2.5 REGISTERED AGENT AND REGISTERED OFFICE. The registered agent of
the Company shall be the initial registered agent named in the
Certificate or such other Person or Persons as the Sole Member may
designate from time to time in the manner provided by the Act. The
registered office of the Company required by the Act to be
maintained in the State of Delaware shall be the initial registered
office named in the Certificate or such other office (which need
not be a place of business of the Company) as the Sole Member may
designate from time to time in the manner provided by the Act.
2.6 SEPARATE EXISTENCE. The Company shall:
(a) Maintain in full effect its existence, rights and franchises
as a limited liability company under the laws of the State of Delaware and
obtain and preserve its qualification to do business in each jurisdiction
in which such qualification is or shall be necessary to protect the
validity and enforceability of this Agreement and each other instrument or
agreement necessary or appropriate to the proper administration hereof and
to permit and effectuate the undertakings contemplated hereby.
(b) Maintain with commercial banking institutions its own
deposit account or accounts separate from those of any Affiliate of the
Illinois Power Affiliated Group.
(c) Ensure that, to the extent that it shares the same officers
or other employees with its Sole Member or any Affiliate of the Illinois
Power Affiliated Group, the salaries of and the expenses related to
providing benefits to such officers and other employees shall be fairly
allocated among such entities, and each such entity shall bear its fair
share of the salary and benefit costs associated with all such common
officers and employees.
(d) Pay all of its operating expenses incurred by it from the
assets of the Company, and ensure that, to the extent that it jointly
contracts with its Sole Member or any Affiliate of the Illinois Power
Affiliated Group to do business with vendors or service providers or to
share overhead expenses, the costs incurred in so doing shall be allocated
fairly among such entities, and each such entity shall bear its fair share
of such costs.
(e) Maintain a principal executive and administrative office
through which its business is conducted separate from those of its Sole
Member and any Affiliate of the Illinois Power Affiliated Group. To the
extent that the Company and its Sole Member or any Affiliate of the
Illinois Power Affiliated Group have offices in contiguous space, there
shall be fair and appropriate allocation of overhead costs among them,
and each such entity shall bear its fair share of such expenses.
(f) Observe all necessary, appropriate and customary
formalities, including, but not limited to, holding all regular and special
Members' meetings, and meetings of the Company's Management Committee,
appropriate to authorize all action on behalf of the Company, keeping all
resolutions or consents necessary to authorize actions taken or to be
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taken, and maintaining accurate and separate books, records and accounts,
including, but not limited to, payroll and intercompany transaction
accounts.
(g) At all times from and after the entry into any Sale
Agreement and the acquisition of any Intangible Transition Property, vest
the management of the Company in the Management Committee and ensure that
its Management Committee shall at all times include at least one
Independent Manager.
(h) Refrain from commingling its assets with those of the Sole
Member or any member of the Illinois Power Affiliated Group (except as
contemplated by any Sale Agreement and any servicing or administration
agreements entered into in connection therewith).
(i) Act solely in its own name and through its own authorized
managers and agents, and no Affiliate of the Illinois Power Affiliated
Group shall be appointed to act as agent of the Company, except as
expressly contemplated by the Basic Documents.
(j) Ensure that no Affiliate of the Illinois Power Affiliated
Group shall advance funds to the Company, or otherwise guaranty debts of
the Company, except as provided in the Basic Documents; PROVIDED, HOWEVER,
that any Affiliate of the Illinois Power Affiliated Group may provide funds
to the Company in connection with the initial capitalization of the Company
or as thereafter permitted by the Basic Documents with any subsequent
capitalization.
(k) Not enter into any guaranty, or otherwise become liable,
with respect to any obligation of any Affiliate of the Illinois Power
Affiliated Group and not hold itself out, or permit itself to be held out,
as having agreed to pay or as being liable for the debts of Illinois Power
or any other member of the Illinois Power Affiliated Group.
(l) Comply with all restrictions on its business and operations
as set forth in the Section 2.3.
2.7 LIMITATION ON CERTAIN ACTIVITIES. Notwithstanding any other
provisions of this Agreement or the Certificate, the Company, and
the Sole Member or Management Committee on behalf of the Company,
shall not:
(a) engage in any business or activity other than as set forth in
Article 2 hereof;
(b) without the affirmative vote of its Sole Member and (at any
time after the formation of the Management Committee) the affirmative vote
of all of the Managers, initiate any Event of Bankruptcy with respect to
the Company or take any company action in furtherance of any such Event of
Bankruptcy;
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(c) merge or consolidate with, or convert into, any other Person
or, except to the extent permitted by each Sale Agreement, sell all or
substantially all of its assets or acquire all or substantially all of the
assets or capital stock or other ownership interest of any other Person;
(d) incur any indebtedness or assume or guarantee any
indebtedness of any Person (other than the indebtedness incurred under the
Sale Agreements); or
(e) to the fullest extent permitted by law, without the
affirmative vote of its Member and (at any time after the formation of the
Management Committee) the affirmative vote of all Managers, execute any
dissolution, liquidation, or winding up of the Company.
To the fullest extent permitted by applicable law, including without
limitation Section 18-1101(c) of the Act, the fiduciary duty of each Manager,
including the Independent Manager, in respect of any decision on any matter
referred to in this Section 2.7 shall be owed solely to the Company
(including its creditors) and not to the Sole Member or any other holders of
equity interest in the Company as may exist at such time.
2.8 NO STATE LAW PARTNERSHIP. No provisions of this Agreement
(including, without limitation, the provisions of Article 6) shall
be deemed or construed to constitute a partnership (including,
without limitation, a limited partnership) or joint venture, or the
Sole Member a partner or joint venturer of or with any Manager or
the Company, for any purposes.
2.9 ADDRESS OF THE SOLE MEMBER. The address of the Sole Member is set
forth on EXHIBIT A, as amended from time to time, attached hereto
and made a part hereof.
ARTICLE 3
TERM
3.1 COMMENCEMENT. The Company's term commenced upon the filing of the
Certificate with the Secretary on September 10, 1998.
3.2 CONTINUATION. Notwithstanding any provision of this Agreement,
the bankruptcy (as defined in Section 18-101(1) of the Act and
including any event described in Section 18-304(a) of the Act) of
any Member will not cause the Sole Member to cease to be a member
of the Company, and upon the occurrence of such an event, the
business of the Company shall continue without dissolution.
Notwithstanding any other provision of this Agreement, each Member
waives any right it might have under Section 18-801 of the Act to
agree in writing to dissolve the Company, including upon the
occurrence of the bankruptcy (as defined in Section 18-101(1) of
the Act and including any event described in Section 18-304(a) of
the Act) of any
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Member or the occurrence of any other event which under the Act
would otherwise cause any Member to cease to be a member of the
Company.
ARTICLE 4
CAPITAL CONTRIBUTIONS
4.1 CAPITAL CONTRIBUTION. The Sole Member has made an initial capital
contribution of $1,000. The Sole Member may be required or shall
be permitted to contribute additional Capital Contributions in cash
or property to the Company on such terms and conditions as may be
agreed to by the Sole Member from time to time. The amounts so
contributed by the Sole Member shall be credited to the Sole
Member's capital account, as provided in Section 4.2 below. The
Sole Member shall have a Membership Interest of one hundred percent
(100%) of the Company.
4.2 CAPITAL ACCOUNT. The Company shall establish an individual capital
account for the Sole Member.
4.3 NO INTEREST ON OR RETURN OF CAPITAL CONTRIBUTION. No Member shall
be entitled to interest on its Capital Contribution or capital
account. Except as provided herein or by law, no Member shall have
a right to demand or receive the return of its Capital
Contribution.
ARTICLE 5
ALLOCATIONS; BOOKS
5.1 ALLOCATIONS OF INCOME AND LOSS.
(a) BOOK ALLOCATIONS. The net income and net loss of the
Company shall be allocated entirely to the Sole Member.
(b) TAX ALLOCATIONS. Because the Company is not making (and
will not make) an election to be treated as an association taxable as a
corporation under Section 301.7701-3(a) of the U.S. Treasury Regulations,
and because the Company is a business entity that has a single owner and is
not a corporation, it shall be disregarded as an entity separate from its
owner for federal income tax purposes under Section 301.7701-3(b)(1) of the
U.S. Treasury Regulations. Accordingly, all items of income, gain, loss,
deduction and credit of the Company for all taxable periods will be treated
for federal income tax purposes, and for state and local income and other tax
purposes to the extent permitted by applicable law, as realized or incurred
directly by the Sole Member. To the extent not so permitted, all items of
income, gain, loss, deduction and credit of the Company shall be allocated
entirely to the Sole Member.
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5.2 BOOKS OF ACCOUNT. At all times during the continuance of the
Company, the Company shall maintain or cause to be maintained full,
true, complete and correct books of account in accordance with
GAAP, using the fiscal year and taxable year of the Sole Member.
In addition, the Company shall keep all records required to be kept
pursuant to the Act.
5.3 DISTRIBUTIONS. The Company may distribute all or any portion of
Net Cash Flows to the Sole Member upon the unanimous vote of the
Management Committee; provided that the Management Committee shall
not authorize such distributions more frequently than monthly.
Notwithstanding any provision to the contrary contained in this
Agreement, the Company shall not be required to make a distribution
to any Member on account of its interest in the Company if such
distribution would violate Section 18-607 of the Act or any other
applicable law or any Basic Documents.
ARTICLE 6
MANAGEMENT OF THE COMPANY
6.1 MANAGEMENT OF COMPANY. At all times from and after the Company's
entry into any Sale Agreement or acquisition of any Intangible
Transition Property, the property and business of the Company shall
be controlled and managed by the Management Committee; PROVIDED,
HOWEVER, that except as otherwise provided in this Agreement, the
Sole Member acting alone can bind or execute any instrument on
behalf of the Company, and may sign all checks, drafts, and other
instruments obligating the Company to pay money. Prior to the
entry into any Sale Agreement and the acquisition of any Intangible
Transition Property, the Sole Member shall appoint an Independent
Manager. In the event that the Independent Manager resigns or is
removed as Independent Manager, the Sole Member shall appoint, as
soon as reasonably practicable, a successor Independent Manager.
The Company shall pay the Independent Manager an annual fee of not
less than $3,500 per year. Each Manager, including the
Independent Manager, is hereby deemed to be a "manager" within the
meaning of Section 18-101(10) of the Act.
6.2 RESIGNATION OF MANAGER. Notwithstanding anything herein to the
contrary, the Independent Manager may not resign as a Manager of
the Company without the consent of the Sole Member.
6.3 DUTIES OF MANAGERS. Each Manager shall execute and deliver the
Management Agreement.
6.4 REMOVAL OF MANAGERS. A Manager (including the Independent Manager)
may be removed, at any time, with or without cause, upon the
written election of the Sole Member.
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ARTICLE 7
DISSOLUTION, LIQUIDATION AND WINDING-UP
7.1 DISSOLUTION. The Company shall continue until dissolved and its
affairs wound up upon the occurrence of the earliest of the
following events:
(a) the election to dissolve the Company made in writing by the
Sole Member and each Manager, including without limitation the Independent
Manager, as permitted by the Basic Documents;
(b) the sale or other disposition of all or substantially all of
the assets of the Company in accordance with the Basic Documents;
(c) the occurrence of any event that causes the last remaining
Member of the Company to cease to be a member of the Company unless the
business of the Company is continued without dissolution in a manner
permitted by the Act; or
(d) the entry of a decree of judicial dissolution of the Company
pursuant to Section 18-802 of the Act.
7.2 ACCOUNTING. In the event of the dissolution, liquidation and
winding-up of the Company, a proper accounting shall be made of the
capital account of the Sole Member and of the net income or net
loss of the Company from the date of the last previous accounting
to the date of dissolution.
7.3 CERTIFICATE OF CANCELLATION. As soon as possible following the
occurrence of any of the events specified in Section 7.1 and the
completion of the winding up of the Company, the Person winding up
the business and affairs of the Company shall cause to be executed
a Certificate of Cancellation of the Certificate in such form as
shall be prescribed by the Secretary and file the Certificate of
Cancellation of the Certificate as required by the Act.
7.4 WINDING UP. Upon the occurrence of any event specified in
Section 7.1, the Company shall continue solely for the purpose of
winding up its affairs in an orderly manner, liquidating its
assets, and satisfying the claims of its creditors. The Sole
Member, or if the Sole Member has ceased to be a member of the
Company, then any Member so designated by the then current
Members of the Company, shall be responsible for overseeing the
winding up and liquidation of the Company, shall take full
account of the liabilities of the Company and its assets, shall
either cause its assets to be sold or distributed, and if sold as
promptly as is consistent with obtaining the fair market value
thereof, shall cause the proceeds therefrom, to the extent
sufficient therefor, to be applied and distributed as provided in
Section 7.5.
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7.5 ORDER OF PAYMENT OF LIABILITIES UPON DISSOLUTION. After
determining that all known debts and liabilities of the Company,
including all contingent, conditional or unmatured liabilities of
the Company, in the process of winding-up, including, without
limitation, debts and liabilities to the Sole Member in the event
it is a creditor of the Company to the extent otherwise permitted
by law, have been paid or adequately provided for, the remaining
assets shall be distributed in cash or in kind to the Members of
the Company.
7.6 LIMITATIONS ON PAYMENTS MADE IN DISSOLUTION. Except as otherwise
specifically provided in this Agreement, the Members of the Company
shall only be entitled to look solely to the assets of Company for
the return of its positive capital account balance and shall have
no recourse for its Capital Contribution and/or share of net income
(upon dissolution or otherwise) against any of the Independent
Manager or the Management Committee.
7.7 LIMITATION ON LIABILITY. Except as otherwise provided by the Act,
the debts, obligations and liabilities of the Company, whether
arising in contract, tort or otherwise, shall be solely the debts,
obligations and liabilities of the Company, and no Member or
Manager shall be obligated personally for any such debt, obligation
or liability of the Company solely by reason of being a Member or a
Manager.
ARTICLE 8
TRANSFER AND ASSIGNMENT
8.1 TRANSFER OF MEMBERSHIP INTERESTS.
(a) The Sole Member may transfer its Membership Interest, but
the transferee shall not be admitted as a Member except in accordance with
Section 8.2. Until the transferee is admitted as a Member, the Sole Member
shall continue to be the sole member of the Company and to be entitled to
exercise any rights or powers of a Member of the Company with respect to the
Membership Interest transferred.
(b) To the fullest extent permitted by law, any purported
transfer of any Membership Interest in violation of the provisions of this
Agreement shall be wholly void and shall not effectuate the transfer
contemplated thereby. Notwithstanding anything contained herein to the
contrary, the Sole Member may not transfer any Membership Interest in
violation of any provision of this Agreement or in violation of any
applicable Federal or state securities laws.
8.2 ADMISSION OF TRANSFEREE AS MEMBER. A transferee of a Membership
Interest desiring to be admitted as a Member must execute a
counterpart of, or an agreement adopting, this Agreement and shall
not be admitted without the unanimous affirmative vote of the
Management Committee, which vote must include the affirmative vote
of the Independent Manager. Upon admission of the transferee as
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a Member, the transferee shall have, to the extent of the
Membership Interest transferred, the rights and powers and shall
be subject to the restrictions and liabilities of the Sole Member
under this Agreement and the Act. The transferee shall also be
liable, to the extent of the Membership Interest transferred, for
the unfulfilled obligations, if any, of the transferor Member to
make Capital Contributions, but shall not be obligated for
liabilities unknown to the transferee at the time such transferee
was admitted as a Member and that could not be ascertained from
this Agreement. Whether or not the transferee of a Membership
Interest becomes a Member, the Sole Member is not released from
any liability to the Company under this Agreement or the Act.
ARTICLE 9
GENERAL PROVISIONS
9.1 NOTICES. All notices, offers or other communications required or
permitted to be given pursuant to this Agreement shall be in
writing and may be personally served or sent by United States mail
and shall be deemed to have been given when delivered in person or
three business days after deposit in United States mail, registered
or certified, postage prepaid, and properly addressed, by or to the
appropriate party. For purposes of this Section 9.1, the addresses
of the parties hereto shall be as set forth on EXHIBIT A hereto.
The address of any party hereto may be changed by a notice in
writing given in accordance with the provisions of this Section
9.1.
9.2 CONTROLLING LAW. This Agreement and all questions relating to its
validity, interpretation, performance and enforcement (including,
without limitation, provisions concerning limitations of actions),
shall be governed by and construed in accordance with the laws of
the State of Delaware, notwithstanding any conflict-of-laws
doctrines of such state or other jurisdiction to the contrary.
9.3 EXECUTION OF COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an
original as against any party whose signature appears thereon, and
all of which shall together constitute one and the same instrument.
This Agreement shall become binding when one or more counterparts
hereof, individually or taken together, shall bear the signatures
of all of the parties reflected hereon as the signatories.
9.4 SEVERABILITY. The provisions of this Agreement are independent of
and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for
any reason any other or others of them may be invalid or
unenforceable in whole or in part.
9.5 ENTIRE AGREEMENT. This Agreement contains the entire understanding
among the parties hereto with respect to the subject matter hereof,
and supersedes all prior and
13
contemporaneous agreements and understandings, inducements or
conditions, express or implied, oral or written, except as herein
contained.
9.6 AMENDMENTS TO ORGANIZATIONAL DOCUMENTS.
(a) The power to alter, amend or repeal this Agreement shall be
only on the consent of the Sole Member, PROVIDED, that the Company shall not
adopt a new Limited Liability Company Agreement or alter, amend or repeal any
provision of Sections 2.3, 2.6, 2.7, 3.2, 6.2, 7.1, 8.2, 9.6 and 9.11 of this
Agreement (the "Restricted Provisions") without the unanimous affirmative
vote of the Management Committee, which vote must include the affirmative
vote of the Independent Manager.
(b) The Company's power to alter, amend or repeal the
Certificate shall be vested in the Sole Member; PROVIDED, that the Company
shall not amend, alter, change or repeal any provision of the Restricted
Provisions without the unanimous affirmative vote of the Management
Committee, which vote must include the affirmative vote of the Independent
Manager. Upon obtaining the approval of any amendment, supplement or
restatement as to the Certificate, the Company shall cause a Certificate of
Amendment or Amended and Restated Certificate to be prepared, executed and
filed in accordance with the Act.
9.7 PARAGRAPH HEADINGS. The paragraph headings in this Agreement are
for convenience and they form no part of this Agreement and shall
not affect its interpretation.
9.8 GENDER, ETC. Words used herein, regardless of the number and
gender specifically used, shall be deemed and construed to include
any other number, singular or plural, and any other gender,
masculine, feminine or neuter, as the context indicates is
appropriate. The term "including" shall mean "including, but not
limited to."
9.9 NUMBER OF DAYS. In computing the number of days (other than
Business Days) for purposes of this Agreement, all days shall be
counted, including Saturdays, Sundays and holidays; PROVIDED,
HOWEVER, that if the final day of any time period falls on a
Saturday, Sunday or holiday on which national banks are or may
elect to be closed, then the final day shall be deemed to be the
next day which is not a Saturday, Sunday or such holiday.
9.10 ASSURANCES. The Sole Member shall hereafter execute and deliver
such further instruments and do such further acts and things as may
be reasonably required or useful to carry out the intent and
purpose of this Agreement and as are not inconsistent with the
terms hereof.
9.11 ENFORCEMENT BY INDEPENDENT MANAGER. Notwithstanding any other
provision of this Agreement, the Sole Member agrees that this
Agreement (including without limitation, Sections 2.3, 2.6, 2.7,
3.2, 6.2, 7.1, 8.2, 9.6 and 9.11) constitutes a legal,
14
valid and binding agreement of the Sole Member, and is
enforceable against the Sole Member by the Independent Manager in
accordance with its terms. The Independent Manager is an
intended beneficiary of this Agreement.
ARTICLE 10
INDEMNIFICATION
10.1 INDEMNIFICATION. Subject to Section 10.3 of this Article, the
Company shall, to the fullest extent permitted by law, indemnify
any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the
Company) by reason of the fact that he is or was a manager,
officer, employee or agent of the Company, or is or was serving at
the request of the Company as a manager, director, officer,
employee or agent of another company, partnership, joint venture,
trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit or
proceeding if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of NOLO CONTENDERE or its
equivalent, shall not, of itself, create a presumption that the
person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests
of the Company, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was
unlawful.
10.2 INDEMNIFICATION FOR SUITS BY OR IN RIGHT OF COMPANY. Subject to
Section 10.3 of this Article, the Company shall, to the fullest
extent permitted by law, indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the
Company to procure a judgment in its favor by reason of the fact
that he is or was a manager, officer, employee or agent of the
Company, or is or was serving at the request of the Company as a
manager, director, officer, employee or agent of another company,
partnership, joint venture, trust or other enterprise against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement of
such action or suit if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests
of the Company; except that no indemnification shall be made in
respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable to the Company unless and
only to the extent that the Court of Chancery or the court in
which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly
and
15
reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
10.3 AUTHORIZATION. Any indemnification under this Article (unless
ordered by a court) shall be made by the Company only as authorized
in the specific case upon a determination that indemnification of
the manager, officer, employee or agent is proper in the
circumstances because he has met the applicable standard of conduct
set forth in Section 10.1 or Section 10.2, of this Article, as the
case may be. Such determination shall be made (a) by independent
legal counsel in a written opinion or (b) by the Sole Member to
the extent, however, that a manager, officer, employee or agent of
the Company has been successful on the merits or otherwise in
defense of any action, suit or proceeding described above, or in
defense of any claim, issue or matter therein, he shall be
indemnified against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection therewith, without the
necessity of authorization in the specific case.
10.4 GOOD FAITH. For purposes of any determination under Section 10.3
of this Article, a person shall be deemed to have acted in good
faith and in a manner he/she reasonably believed to be in or not
opposed to the best interests of the Company, or, with respect to
any criminal action or proceeding, to have had no reasonable cause
to believe his/her conduct was unlawful, if the action is based on
the records or books of account of the Company or another
enterprise, or on information supplied to him by the officers of
the Company or another enterprise in the course of their duties, or
on the advice of legal counsel for the Company or another
enterprise or on information or records given or reports made to
the Company or another enterprise by an independent certified
public accountant or by an appraiser or other expert selected with
reasonable care by the Company or another enterprise. The term
"another enterprise" as used in this Section 10.4 shall mean any
other Company or any partnership, joint venture, trust or other
enterprise of which such person is or was serving at the request of
the Company as a manager, director, officer, employee or agent.
The provisions of this Section 10.4 shall not be deemed to be
exclusive or to limit in any way the circumstances in which a
person may be deemed to have met the applicable standard of conduct
set forth in Sections 10.1 or 10.2 of this Article, as the case may
be.
10.5 COURT ACTION. Notwithstanding any contrary determination in the
specific case under Section 10.3 of this Article, and
notwithstanding the absence of any determination thereunder, any
manager, officer, employee or agent may apply to any court of
competent jurisdiction in the State of Delaware for indemnification
to the extent otherwise permissible under Sections 10.1 and 10.2 of
this Article. The basis of such indemnification by a court shall
be a determination by such court that indemnification of the
manager, officer, employee or agent is proper in the circumstances
because he has met the applicable standards of conduct set forth in
Section 10.1 and 10.2 of this Article, as the case may be. Notice
of any application
16
for indemnification pursuant to this Section 10.5 shall be given
to the Company promptly upon the filing of such application.
10.6 EXPENSES. Expenses incurred in defending or investigating a
threatened or pending action, suit or proceeding may be paid by the
Company in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of the
manager, officer, employee or agent to repay such amount if it
shall ultimately be determined that he is not entitled to be
indemnified by the Company as authorized in this Article.
10.7 NON-EXCLUSIVITY. The indemnification and advancement of expenses
provided by or granted pursuant to this Article shall not be deemed
exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under
any by-law, agreement, contract, vote or pursuant to the direction
(howsoever embodied) of any court of competent jurisdiction or
otherwise, both as to action in his official capacity and as to
action in another capacity while holding such office, it being the
policy of the Company that indemnification of the persons specified
in Sections 10.1 and 10.2 of this Article shall be made to the
fullest extent permitted by law. The provisions of this Article
shall not be deemed to preclude the indemnification of any person
who is not specified in Section 10.1 or 10.2 of this Article but
who the Company has the power of obligation to indemnify under the
provisions of the Act, or otherwise.
10.8 INSURANCE. The Company may purchase and maintain insurance on
behalf of any person who is or was a manager, officer, employee or
agent of the Company, or is or was serving at the request of the
Company as a manager, director, officer, employee or agent of
another company, partnership, joint venture, trust or other
enterprise against any liability asserted against him/her and
incurred by him/her in any such capacity, or arising out of his/her
status as such, whether or not the Company would have the power or
the obligation to indemnify him/her against such liability under
the provisions of this Article.
10.9 CONSOLIDATION/MERGER. For purposes of this Article, references
to "the Company" shall include, in addition to the resulting
Company, any constituent Company (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its
separate existence had continued, would have had the power and
authority to indemnify its managers, directors, officers, and
employees or agents, so that any person who is or was a manager,
director, officer, employee or agent of such constituent Company,
or is or was serving at the request of such constituent Company
as a manager, director, officer, employee or agent of another
Company, partnership, joint venture, trust or other enterprise,
shall stand in the same position under the provisions of this
Article with respect to the resulting or surviving Company as he
would have with respect to such constituent Company if its
separate existence had continued.
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10.10 HEIRS, EXECUTORS, AND ADMINISTRATORS. The indemnification and
advancement of expenses provided by, or granted pursuant to, this
section shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a manager,
director, office, employee or agent and shall inure to the benefit
of the heirs, executors and administrators of such a person.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the Sole Member hereto has executed this
Agreement or caused this Agreement to be executed on its behalf as of the
date first above written.
ILLINOIS POWER COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President-Finance
19
EXHIBIT A
NOTICE ADDRESS OF SOLE MEMBER
NAME OF MEMBER NOTICE ADDRESS
Illinois Power Company 000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Treasury Department
EXHIBIT B
MANAGEMENT AGREEMENT
_________, 1998
Illinois Power Securitization Limited Liability Company
c/o Illinois Power Company
000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
RE: MANAGEMENT AGREEMENT - ILLINOIS POWER SECURITIZATION LIMITED
LIABILITY COMPANY
Ladies and Gentlemen:
For good and valuable consideration, each of the undersigned
persons, who have been designated as members of the management committee of
Illinois Power Securitization Limited Liability Company, a Delaware limited
liability company (the "Company") in accordance with the Limited Liability
Company Agreement of the Company, dated as of September 10, 1998, as it may
be amended or restated from time to time (the "LLC Agreement"), hereby agree:
1. To accept such person's rights and authority as a member of
the Management Committee (as defined in the LLC Agreement) under the LLC
Agreement and to perform and discharge such person's duties and obligations
as a member of the Management Committee under the LLC Agreement and agrees
that such rights, authority, duties and obligations under the LLC Agreement
shall continue until such person's successor as a member of the Management
Committee is designated or until such person's resignation or removal as a
member of the Management Committee in accordance with the LLC Agreement. A
member of the Management Committee is designated as a "manager" of the
Company within the meaning of the Delaware Limited Liability Company Act.
2. THIS MANAGEMENT AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, AND ALL RIGHTS AND
REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAWS.
IN WITNESS WHEREOF, the undersigned have executed this Management
Agreement as of the day and year first above written.
__________________________________
Name:
__________________________________
Name:
__________________________________
Name:
__________________________________
Name:
__________________________________
Name:
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