PIKE COUNTY LIGHT & POWER COMPANY

 

 

TO

 

 

BANKERS TRUST COMPANY,

 

As Trustee

 

 

 

 

Second Supplemental Indenture

 

 

Dated as of October 1, 1998

 

 

 

Supplemental to Indenture of Mortgage and Deed of Trust

 

Dated July 15, 1971

 

 

 

$3,200,000 of First Mortgage Bonds, 7.07% Series C Due 2018

 

 

 

Recorded in the office of the Recorder of Deeds of Pike County, Commonwealth of
Pennsylvania on November 4, 1998 in Book Volume 1637, page 5.

 

 

 

 

TABLE OF CONTENTS

 

        Page                       Parties       2                     Recitals
  Purpose of Second Supplemental Indenture   2         Authorization of Second
Supplemental Indenture   2  

 

ARTICLE I

THE SERIES C BONDS

 

  Section 1   Creation of Bonds   3                       Section 2   Redemption
of Bonds   3                       Section 3   Description of Bonds   4        
  Form       4                 Signatures   4                 Trustee’s
Authentication   5                 Modification   6                 Redemption
Table and Procedure    7                 Transfer   7                 Exchange 
  8    

 

ARTICLE II

CONCERNING THE TRUSTEE

 

 

Section 1

  The Trustee   8    

ARTICLE III

MISCELLANEOUS PROVISIONS

 

  Section 1   Amendment of Indenture   8                       Section 2  
Further Amendments of Indenture   8                       Section 3   Bondholder
Consent   8                       Section 4   Incorporation of Indenture   8    
                  Section 5   Incorporation of Certain Provisions of the Bond
Purchase Agreement   8                       Section 6   Counterparts   8      
                Section 7   Schedule I Confirms Lien of Indenture   8          
            Section 8   Headings Not to Affect Construction   9                
      TESTIMONIUM   9       SIGNATURES AND SEALS   9       ACKNOWLEDGMENTS   9  
   

SCHEDULE I – Detailed Description of Property

  9    

 

 

1 

 

 

SECOND SUPPLEMENTAL INDENTURE dated as of October 1, 1998 between PIKE COUNTY
LIGHT & POWER COMPANY, a corporation duly organized and existing under the laws
of the Commonwealth of Pennsylvania (hereinafter called the “Company”), having
its principal office at 219 1/2 Broad Street, Milford, Pennsylvania 18337, party
of the first part, and BANKERS TRUST COMPANY, a corporation duly organized and
existing under the laws of the State of New York, as Trustee (hereinafter called
the “Trustee”), having an office at Four Albany Street, New York, New York,
party of the second part.

 

WHEREAS, to secure the Company’s First Mortgage Bonds (hereinafter called the
“Bonds”), the Company has executed and delivered to the Trustee an Indenture of
Mortgage and Deed of Trust (herein called the “Original Indenture”) dated July
15, 1971, which is recorded in the office of the Recorder of Deeds of Pike
County, Pennsylvania in Book Volume 115, page 235, as supplemented by a First
Supplemental Indenture (the “First Supplemental Indenture”) dated as of August
15, 1990, which was recorded in the office of the Recorder of Deeds of Pike
County, Pennsylvania in Book Volume 0229, page 112; and

 

WHEREAS, the Company desires by this Second Supplemental Indenture to create
another series of Bonds to be issued under the Indenture (the Original
Indenture, as supplemented by the First Supplemental Indenture and this Second
Supplemental Indenture being herein called the “Indenture”), to designate or
otherwise distinguish such series, to specify the particulars necessary to
describe and define the same, and to specify such other provisions and
agreements in respect thereto as are in said Indenture provided or permitted and

 

WHEREAS, the Company has issued under the Indenture $950,000 of its First
Mortgage Bonds, 9% Series A due August 15, 2001, of which $883,500 is
outstanding on the date hereof; and

 

WHEREAS, the Company has issued under the Indenture $1,800,000 of its First
Mortgage Bonds, 9.95% Series B due August 15, 2020, of which $1,800,000 is
outstanding on the date hereof; and

 

WHEREAS, the Board of Directors of the Company has duly authorized this Second
Supplemental Indenture and pursuant to the provisions of the Indenture has fixed
and determined the terms and conditions of the Series C Bonds hereinafter
referred to, to be issued under the Indenture; and

 

WHEREAS, all conditions and requirements necessary to make this Second
Supplemental Indenture, when duly executed, a valid, binding and legal
instrument in accordance with its terms and for the purposes herein expressed
have been done, performed and fulfilled; and

 

NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH:

 

That in consideration of the premises and of the sum of One Dollar lawful money
of the United States of America to the Company by the Trustee at or before the
execution and delivery of this Second Supplemental Indenture paid, the receipt
whereof is hereby acknowledged, and of other good and valuable considerations,
the Company has executed and delivered this Second Supplemental Indenture.

 

2 

 

 

 

ARTICLE I

THE SERIES C BONDS

Section 1.                There is hereby created a series of Bonds to be issued
under and secured by the Indenture, to be designated as “First Mortgage Bonds,
7.07% Series C due 2018 of the Company (herein called the “Series C Bonds”). The
Series C Bonds shall be limited in aggregate principal amount to $3,200,000,
except as provided under Section 2.04 of the indenture. The date of the
commencement of the first interest period for all Series C Bonds shall be the
date of original issuance of the Series C Bonds. The Series C Bonds shall mature
October 1, 2018. The principal of, premium, if any, and interest on the Series C
Bonds shall be payable in any coin or currency of the United States of America
which is at the time of payment legal tender for public and private debts.
Unless otherwise provided in a written agreement between the Company and a
holder of the Bonds, the place where such principal, premium, if any, and
interest shall be payable shall, subject to Section 2 of this Article I, be the
Corporate Trust Office of the Trustee in the Borough of Manhattan, City and
State of New York. The rate of interest shall be 7.07% per annum, payable
(computed on the basis of a 360-day year of twelve 30-day months) semi-annually
on the first day of April and the first day of October in each year, commencing
April 1, 1999.

Section 2.                The Series C Bonds shall be redeemable prior to their
maturity, in whole, or from time to time in part, as, and at the times and
respective redemption prices, provided in the form of Series C Bond set forth in
Section 3 of this Article I. In case any Series C Bond is to be redeemed in part
only, the notice which relates to such Bond shall state the portion of the
principal amount thereof to be redeemed and shall state that on and after the
date fixed for redemption, upon surrender of such Bond, the holder will receive
the redemption price in respect of the principal amount thereof called for
redemption and a new Series C Bond or Bonds of authorized denominations for the
principal amount thereof remaining unredeemed or, at the option of the holder of
such Series C Bond called for redemption, the Trustee, in lieu of delivering a
new Series C Bond or Bonds as aforesaid, will make a notation on such Series C
Bond called for redemption of the payment of the redeemed portion thereof; and
the notice shall further state that, notwithstanding the foregoing, on the date
fixed for redemption, the holder of any Series C Bond to be redeemed in part
only will receive the redemption price in respect of the principal amount
thereof called for redemption without the surrender of such Bond, provided that
there shall have been filed with the Trustee an agreement between the registered
owner of such Bond and the Company whereby the holder will receive the
redemption price in respect of the principal amount thereof called for
redemption without such surrender, and such holder agrees that he will, prior to
delivery upon sale, transfer or other disposition, surrender such Bond to the
Trustee in exchange for a new Series C Bond or Bonds of authorized denominations
for the unredeemed balance of the principal amount thereof The Trustee is
authorized to act in accordance with any such agreement and shall, subject to
the provisions of Section 14.01 of the Indenture, have no liability to any
holder of Series C Bonds, the Company, or otherwise for failure of any holder of
Series C Bonds to submit such Series C Bonds to the Trustee as aforesaid. The
Company hereby agrees to indemnify the Trustee against, and hold it harmless
from, any loss or damage resulting from any act or omission on the part of any
Bondholder or the Company in connection with any such agreement and against any
liability resulting from any action, subject to the provisions of Section 14.01
of the Indenture, taken by the Trustee in accordance with the provisions of any
such agreement.

3 

 

 

If fewer than all of the Series C Bonds are to be redeemed, the Trustee, upon
notice from the Company of the principal amount of the Series C Bonds to be
redeemed, shall prorate the principal amount of Series C Bonds to be redeemed
among all holders of Series C Bonds in proportion (consistent with the
requirement that particular Series C Bonds be redeemed only in multiples of
$1,000) to the respective unpaid principal amounts of Series C Bonds held by
such holders on such date of proration (which date shall not be more than 10
days prior to the mailing of notice to such holders of such redemption as herein
required), and shall then select for redemption the particular Series C Bonds or
portions to be redeemed.

 

The Trustee shall promptly notify the Company in writing of the Series C Bonds
selected for redemption and, in the case of any Series C Bonds selected for
partial redemption, the principal amounts thereof to be redeemed.

 

Section 3.                The Series C Bonds shall be registered Bonds without
coupons in the denomination of $1,000 and in such multiples of $1,000 as may be
executed by the Company and delivered to the Trustee for authentication and
delivery. The office or agency of the Company at which books for the
registration and registration of transfer of Bonds of Series C shall be kept
shall be the Corporate Trust Office of the Trustee in the Borough of Manhattan,
City and State of New York. The Series C Bonds shall be transferable and
exchangeable as provided in the form thereof set forth in this Second
Supplemental Indenture.

The Series C Bonds and the Trustee’s Certificate to be inscribed on all Bonds of
said series, are to be substantially in the forms following:

 

[Form of Face of Series C Bond]

 

PIKE COUNTY LIGHT & POWER COMPANY

 

First Mortgage Bond 7.07% Series C Due 2018

 

PIKE COUNTY LIGHT & POWER COMPANY, a Pennsylvania corporation (herein called the
“Company”), for value received, hereby promises to pay to _____________, or
registered assigns, the principal sum of Three Million Two Hundred Thousand
Dollars ($3,200,000) on October 1, 2018, and to pay interest (computed on the
basis of a 360-day year of twelve 30-day months) on such principal sum at the
rate per annum specified in the title of this Bond semi-annually on April 1 and
October 1 in each year, commencing April 1, 1999 until payment of such principal
sum has been made, or duly provided for, to the registered owner hereof as of
the close of business on the record date respecting such interest payment date.
The fifteenth day of the month next preceding an interest payment date (whether
or not such fifteenth day is a Business Day, as defined in the Indenture
referred to on the reverse side hereof) shall be deemed the “record date” for
the determination of persons to whom interest on Series C Bonds shall be
payable; and, in the event that any Bond is transferred after the close of
business on such record date and prior to the opening of business on the
interest payment date next following, the interest payable on such interest
payment date shall be paid to the registered holder at the close of business on
such record date of such Series C Bond, subject to certain exceptions set forth
in the Indenture. Any such interest not so punctually paid or duly provided for
shall forthwith cease to be payable to the registered holder on such record
date, and may be paid to the person in whose name this Series C Bond is
registered at the close of business on a special record date for the payment of
such defaulted interest to be fixed by the Trustee, notice whereof shall be
given to holders of Series C Bonds not less than 10 days prior to such special
record date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Series C Bonds may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in such Indenture.

 

4 

 

 

 

Unless otherwise provided in a written agreement between the holder of this Bond
and the Company, both principal of and interest on this Bond, as well as any
premium hereon in case of the redemption hereof prior to maturity, are payable
at the Corporate Trust Office of the Trustee hereinafter named, in the Borough
of Manhattan, City and State of New York, or at such other office or agency in
said Borough as shall be maintained by the Company for such purpose, in such
coin or currency of the United States of America as at the time of payment shall
be legal tender for public and private debts.

 

Reference is made to the further provisions of this Bond set forth on the
reverse hereof, which for all purposes have the same effect as though fully set
forth at this place.

 

This Bond shall not be valid or obligatory for any purpose until authenticated
by the execution by the Trustee of the certificate inscribed hereon.

 

In Witness Whereof, the Company has caused this Bond to be executed in its
corporate name by a facsimile of the signature of its President or a Vice
President and imprinted with a facsimile of its corporate seal, attested by a
facsimile of the signature of its Secretary or an Assistant Secretary.

 

Dated:

 

PIKE COUNTY LIGHT & POWER COMPANY

 

 

By: ___________________________________

President

[Corporate Seal]

 

Attest:

 

 

__________________________________________

Secretary

 

[Form of Trustee’s Certificate]

 

This is one of the First Mortgage Bonds of the Series designated above and
described in the within-mentioned Indenture.

 

 

Bankers Trust Company,as Trustee

 

 

By ______________________________

(Authorized Officer)

 

5 

 

 

[Form of Reverse of Series C Bond]

 

This Bond is one of a duly authorized issue of Bonds of the Company, of an
unlimited (except as provided in the Indenture hereinafter mentioned) permitted
principal amount, all issued or to be issued in one or more series, all of the
Bonds of all Series C being issued or to be issued under and, irrespective of
the time of issue, all equally secured by an Indenture of Mortgage and Deed of
Trust (herein, with all instruments stated to be supplemental thereto to which
the Trustee hereinafter named is or shall be a party, called the “Indenture”),
dated July 15, 1971, to Bankers Trust Company (hereinafter, with its successors
as defined in the Indenture, referred to as the “Trustee”), to which Indenture,
an executed counterpart of which is on file with the Trustee, reference is
hereby made for a description of the properties mortgaged and pledged to the
Trustee, and for a statement of the nature and extent of the security, the
rights of the holders of the Bonds and of the Company and the Trustee with
respect to such security, and the terms and conditions upon which said Bonds are
or are to be issued and secured; but neither the foregoing reference to the
Indenture, nor any provision of this Bond or of the Indenture, shall affect or
impair the obligation of the Company, which is absolute and unconditional, to
pay, at the stated or accelerated maturities herein provided, the principal of;
premium, if any, and interest on this Bond as herein provided.

 

The Indenture and the rights and obligations of the Company and of the holders
of the Bonds thereunder may be changed or modified at any time upon the consent
and approval of the company and of the holders of at least 66 2/3% in principal
amount of the Bonds then outstanding affected by such change or modification, as
provided in the Indenture, and in the manner and subject to the limitations
therein set forth; provided, that no such change or modification shall (a) alter
or impair the obligation of the Company to pay the principal of premium, if any,
and interest on any Bond at the time and place and at the rate and in the
currency provided therein, without the consent of the holder of such Bond, (b)
permit the creation by the Company of any mortgage, or lien in the nature of a
mortgage, ranking prior to or pari passu with the lien of the Indenture, or
alter adversely to the Bondholders the character of the lien of the Indenture,
except as in the Indenture otherwise expressly provided, unless the creation of
such mortgage or lien, or such alteration of the lien of the Indenture, be
consented to by the holders of all outstanding Bonds, (c) affect the Trustee
unless consented to by the Trustee or (d) permit a reduction of the percentage
of the Bonds required for any change or modification of the Indenture, without
the consent of the holders of all outstanding Bonds.

 

The principal of this Bond together with accrued interest thereon may be
declared, or may become, due and payable before maturity in certain events, on
the conditions, in the manner and with the effect set forth in the Indenture.

 

Each Series C Bond shall be dated as of the date of its authentication, and
shall bear interest from April 1 or October 1, as the case may be, next
preceding the date of such Bond to which interest has been paid (unless the date
of such Bond is an April 1 or an October 1 to which interest has been paid, in
which case such Bond shall bear interest from its date, or unless the date of
such Bond is prior to the payment of any interest on the Series C Bonds, in
which case it shall bear interest from the date of original issuance of the
Series C Bonds) However, so long as there is no existing default in the payment
of interest on the Series C Bonds, any such Bond authenticated by the Trustee
after the close of business on the record date for any interest payment date and
prior to such interest payment date shall be dated the date of its
authentication, but shall bear interest from such interest payment date;
provided, however, that if and to the extent that the Company shall default in
the payment of interest on such interest payment date, then such Bond shall bear
interest from the April 1 or October 1, as the case may be, next preceding the
date of such Bond to which interest has previously been paid or made available
for payment on the outstanding Series C Bonds or, if no interest has been paid
on such Bond, from the date of original issuance of the Series C Bonds.

 

The Series C Bonds are not entitled to the benefit of a Sinking or Improvement
Fund provided for in the Indenture. The Series C Bonds may be redeemed at the
option of the Company, either as a whole or in part, on any date prior to
maturity and on or after October 1, 2008, whether or not an interest payment
date, at the respective redemption prices (expressed as percentages of principal
amount to be redeemed) indicated in the tabulation below under the heading
“Optional Redemption Prices” and are also subject to redemption as a whole at a
redemption price equal to the principal amount thereof pursuant to Section 10.07
of the Indenture upon the sale in certain cases or the taking by exercise of the
power of eminent domain of all or substantially all the property subject to the
lien of the Indenture:

 

6 

 

 

 

 

 

DATE FIXED FOR REDEMPTION

OPTIONAL REDEMPTION PRICES (%)

 

 

  On or after October 1, 2008 and prior to
October 1, 2009 103.349     Thereafter and prior to October 1, 2010 102.977    
Thereafter and prior to October 1, 2011 102.605     Thereafter and prior to
October 1, 2012 102.233

 

    Thereafter and prior to October 1, 2013 101.861     Thereafter and prior to
October 1, 2014 101.488     Thereafter and prior to October 1, 2015 101.116    
Thereafter and prior to October 1, 2016 100.744     Thereafter and prior to
October 1, 2017 100.372     Thereafter to maturity 100.000

 

together, in each case, with interest accrued and unpaid to the date fixed for
redemption, upon notice mailed to the respective registered owners of the
Series C Bonds designated for redemption at least 30 days and not more than 60
days prior to the date fixed for redemption, at their addresses appearing upon
the Bond registration books, all subject to the conditions more fully set forth
in the Indenture.

No recourse shall be had for the payment of any part of principal of, or premium
or interest on, this Bond, or for any claim based hereon or thereon, or
otherwise in any manner with respect hereto, or with respect to the Indenture,
to or against any incorporator or any past, present or future stockholder,
officer or director of the Company or of any successor corporation, either
directly or through the Company or any successor corporation, whether by virtue
of any constitution, statute or other provision of law, or by the enforcement of
any assessment or penalty, or otherwise, all such liability being expressly
waived and released by the acceptance of this Bond and as part of the
consideration for the issue hereof, as provided in the Indenture.

7 

 

 

If this Bond or any part thereof is called for redemption and payment duly
provided, this Bond or such part thereof shall cease to bear interest from and
after the date for such redemption.

Registration of transfer of this Bond may be made and this Bond may be exchanged
as prescribed in the Indenture by the registered owner in person or by duly
authorized attorney, at the Corporate Trust office of the Trustee, or at such
other offices or agencies of the Trustee or the Company as shall be maintained
for such purpose, upon the surrender of this Bond, and thereupon a new Bond or
Bonds of authorized denominations of the same series for a like aggregate
principal amount will be issued to the transferee, all in the manner and subject
to the terms, conditions and limitations specified in the Indenture. No service
charge shall be made for any registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto. The Company and the
Trustee may deem and treat the person in whose name this Bond is registered as
the absolute owner hereof for the purpose of receiving payment of or on account
of the principal and interest due hereon (subject to the provisions of the first
paragraph on the face of this Bond), and for all other purposes, and neither the
Company, the Trustee nor any paying agent or agency shall be affected by any
notice to the contrary, whether this Bond or such interest shall be overdue or
not.

ARTICLE II

CONCERNING THE TRUSTEE

Section 1. The Trustee shall not be responsible in any manner whatsoever for or
in respect of the validity or sufficiency of this Second Supplemental Indenture
or the due execution hereof by the Company or for or in respect of the recitals
and statements contained herein, all of which recitals and statements are made
solely by the Company.

ARTICLE III

MISCELLANEOUS PROVISIONS

Section 1. The Indenture is hereby amended with respect to redemption from time
to time of fewer than all of the outstanding Series C Bonds, and not with
respect to Bonds of any other series except as may be specifically provided with
respect thereto, to the extent necessary so that the provisions of Article I of
this Second Supplemental Indenture are not inconsistent with the Indenture.

Section 2. The holders of the Series C Bonds, by their purchase and holding
thereof, agree that the Indenture is amended by (a) deleting therefrom
Section 7.13 thereof; and (b) substituting the word “Engineer” for the words
“Independent Engineer” in Sections 4.01 and 10.02 thereof.

Section 3. Bonds owned or held by the Company or an Affiliate of the Company
shall not be counted for the purposes of determining whether the requisite
consent of holders of Bonds has been given to take any action under the
Indenture requiring such consent.

Section 4. Except insofar as herein otherwise expressly provided, all the
provisions, terms and conditions of the Original Indenture shall be deemed to be
incorporated in, and made a part of, this Second Supplemental Indenture; and the
Original Indenture as supplemented by the First Supplemental Indenture and this
Second Supplemental Indenture is in all respects ratified and confirmed; and the
Original Indenture, the First Supplemental Indenture and this Second
Supplemental Indenture shall be read, taken and construed as one and the same
instrument.

Section 5. Notwithstanding any provisions in the Indenture to the contrary, so
long as any Series C Bonds are outstanding Section 6.01 and Section 8.02 of the
Bond Purchase Agreement dated as of October __, 1998 between the Company and
Woodmen Accident and Life Company are hereby incorporated into this Second
Supplemental Indenture with respect to the Series C Bonds. No amendment to
Section 6.01 and Section 8.02 of the Bond Purchase Agreement shall adversely
affect the rights and/or obligations of the Trustee without the Trustee’s
consent.

Section 6. This Second Supplemental Indenture may be executed in any number of
counterparts, and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts, or as many of them as the Company and
the Trustees shall preserve undestroyed, shall together constitute but one and
the same instrument.

8 

 

 

Section 7. Schedule I hereto confirms the lien of the Indenture on the
properties specifically described thereon.

Section 8. The headings of the Articles and Sections herein are for convenience
only and shall not affect the construction hereof.

 

IN WITNESS WHEREOF, PIKE COUNTY LIGHT AND POWER COMPANY has caused this Second
Supplemental Indenture to be signed in its corporate name by its President or a
Vice President and its corporate seal to be hereunto affixed and attested by its
secretary or an Assistant Secretary, and, in token of its acceptance of the
trusts created hereunder, Bankers Trust company has caused this Second
Supplemental Indenture to be signed in its corporate name by one of its Vice
Presidents and its corporate seal to be hereunto affixed and attested by one of
its Assistant Secretaries, all as of the day and year first above written, but
actually executed by Pike County Light & Power Company on the date set forth in
its acknowledgement appended hereto.

PIKE COUNTY LIGHT & POWER COMPANY

[Corporate Seal]

By /s/ R. Lee Haney

Senior Vice President

Attest:

/s/ [unknow signator]

Secretary

BANKERS TRUST COMPANY, as Trustee

By /s/ Barbara Nastro

Assistant Treasurer

Attest:

/s/ William T. Jenkins

Assistant Treasurer

 

STATE OF NEW YORK )

) SS.:

COUNTY OF ROCKLAND )

On the 2nd day of November, in the year 1998, before me personally came R. Lee
Haney, to me known, who, being by me duly sworn, did depose and say that he
resides at 201 Wannamaker Lane, Upper Nyack, NY; that he is a Senior Vice
president of Pike County Light & Power Company, one of the corporations
described in and which executed the above instrument; that he knows the seal of
said corporation; that the seal affixed to said instrument is such corporate
seal; that it was so affixed by order of the Board of Directors of said
corporation; and that he signed his name thereto by like order.

/s/ Todd M. Lieval

Notary Public

TODD M. LIEVAL

Notary Public, State of New York

No 4954004

Qualified in Rockland County

Commission Expires July 31, 1999

 

STATE OF NEW YORK )

) SS.:

COUNTY OF ROCKLAND )

On the 2nd day of November, in the year 1998, before me personally came Barbara
Nastro, to me known, who, being by me duly sworn, did depose and say that (s)he
resides at Hoboken, NJ; that (s)he is an Assistant Treasurer of Bankers Trust
Company, one of the corporations described in and which executed the above
instrument; that (s)he knows the seal of said corporation; that the seal affixed
to said instrument is such corporate seal; that it was so affixed by order of
the Board of Directors of said corporation; and that (s)he signed her/his name
thereto by like order.

/s/ Matthew Sherman

Notary Public

MATTHEW SHERMAN

Notary Public, State of New York

No. 01 SH5087362

Commission Expires 7/3/99

9