Exhibit 4.6


 




 


EXECUTION COPY





 


FIRST SUPPLEMENTAL
INDENTURE


 


INTERNATIONAL
TRANSMISSION COMPANY


 


TO


 


BNY MIDWEST TRUST
COMPANY


 


Trustee


 










 


Dated as of July 15,
2003


 










 


Supplementing the
First Mortgage and Deed of Trust


Dated as of July 15,
2003


 


THIS INSTRUMENT
CONTAINS AFTER-ACQUIRED PROPERTY PROVISIONS


 


Establishing a
series of Securities designated 4.45% First Mortgage Bonds, Series A




 





 





















 


TABLE
OF CONTENTS


 


	
  ARTICLE ONE
  DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION

  	
   

  
	
   

  	
   

  
	
  Section 101.    Definitions

  	
   

  
	
   

  	
   

  
	
  ARTICLE TWO
  TITLE, FORM AND TERMS OF THE SERIES A BONDS

  	
   

  
	
   

  	
   

  
	
  Section 201.    Title
  of the Series A Bonds

  	
   

  
	
   

  	
   

  
	
  Section 202.    Form and
  Terms of the Series A Bonds

  	
   

  
	
   

  	
   

  
	
  Section 203.    Execution
  and Authentication

  	
   

  
	
   

  	
   

  
	
  Section 204.    Depositary for Global Securities

  	
   

  
	
   

  	
   

  
	
  Section 205.    Place of Payment

  	
   

  
	
   

  	
   

  
	
  Section 206.    Legends

  	
   

  
	
   

  	
   

  
	
  Section 207.    Restrictions
  on Transfer and Exchange of Series A Bonds

  	
   

  
	
   

  	
   

  
	
  Section 208.    Book-Entry
  Provisions for Restricted Global Securities and Regulation S Global
  Securities

  	
   

  
	
   

  	
   

  
	
  Section 209.    Special
  Transfer Provisions

  	
   

  
	
   

  	
   

  
	
  ARTICLE THREE  REDEMPTION

  	
   

  
	
   

  	
   

  
	
  ARTICLE FOUR  MAINTENANCE
  AND RENEWAL

  	
   

  
	
   

  	
   

  
	
  ARTICLE FIVE  REPORTS

  	
   

  
	
   

  	
   

  
	
  ARTICLE SIX  NET
  EARNINGS CERTIFICATE

  	
   

  
	
   

  	
   

  
	
  ARTICLE SEVEN  LIEN

  	
   

  
	
   

  	
   

  
	
  ARTICLE EIGHT  MISCELLANEOUS
  PROVISIONS

  	
   

  



 


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FIRST SUPPLEMENTAL
INDENTURE, dated as of July 15, 2003, between International Transmission
Company, a corporation organized and existing under the laws of the State of
Michigan (herein called the “Company”),
having its principal office at 1901 South Wagner, Ann Arbor, MI 48103 and BNY
MIDWEST TRUST COMPANY, a corporation duly organized and existing under the laws
of the State of Illinois, as Trustee (herein called the “Trustee”), the office of the Trustee at
which on the date hereof its corporate trust business is principally
administered being 2 N. LaSalle Street, Suite 1020, Chicago, Illinois 60630.


 


RECITALS OF THE
COMPANY


 


WHEREAS, the Company has
heretofore executed and delivered to the Trustee a First Mortgage and Deed of
Trust dated as of July 15, 2003 (the “Original
Indenture”) providing for the issuance by the Company from time to
time of its bonds, notes and other evidence of indebtedness to be issued in one
or more series (in the Original Indenture and herein called the “Securities”) and to provide security for
the payment of the principal of and premium, if any, and interest, if any, on
the Securities; and


 


WHEREAS, the Company, in
the exercise of the power and authority conferred upon and reserved to it under
the provisions of the Original Indenture and pursuant to appropriate
resolutions of the Board of Directors, has duly determined to make, execute and
deliver to the Trustee this First Supplemental Indenture (the “First Supplemental Indenture”) to the
Original Indenture as permitted by Sections 2.01, 3.01, 4.01, 4.02 and 14.01 of
the Original Indenture in order to establish the form or terms of, and to
provide for the creation and issuance of, a series of Securities to be
designated and in such initial aggregate principal amount as further set out in
Section 202 hereof; and


 


WHEREAS, all things
necessary to make the Securities of the First Series, when executed by the
Company and authenticated and delivered by the Trustee or any Authenticating
Agent and issued upon the terms and subject to the conditions hereinafter and
in the Original Indenture set forth against payment therefore the valid,
binding and legal obligations of the Company and to make this First
Supplemental Indenture a valid, binding and legal agreement of the Company,
have been done;


 


NOW, THEREFORE, THIS
FIRST SUPPLEMENTAL INDENTURE WITNESSETH that, in order to establish the terms
of a series of Securities, and for and in consideration of the premises and of
the covenants contained in the Original Indenture and in this First
Supplemental Indenture and for other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, it is mutually
covenanted and agreed as follows:


 


ARTICLE ONE



DEFINITIONS AND OTHER PROVISIONS

OF GENERAL APPLICATION


 


Section 101.           Definitions. 
Each capitalized term that is used herein and is defined in the Original
Indenture shall have the meaning specified in the Original Indenture unless
such term is otherwise defined herein.


 





















 


“Adjusted
Treasury Rate” means, with respect to any Redemption Date, the rate
per annum equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, calculated using a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Redemption Date, plus 0.15%.


 


“Agent Member” has the meaning given to such
term in Section 208(a) hereof.


 


“Comparable
Treasury Issue” means the United States Treasury security selected
by an Independent Investment Banker as having a maturity comparable to the
remaining term of the Series A Bonds to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities having a maturity
comparable to the remaining term of such Series A Bonds.


 


“Comparable
Treasury Price” means, with respect to any Redemption Date, (i) the
average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such Redemption Date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated “Composite 3:30 p.m. Quotations for U.S.
Government Securities,” or (ii) if such release (or any successor release)
is not published or does not contain such prices on such business day, (A) the
average of the Reference Treasury Dealer Quotations for such Redemption Date,
after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or (B) if the Trustee obtains fewer than three such Reference
Treasury Dealer Quotations, the average of all such Reference Treasury Dealer
Quotations.


 


“Definitive Securities” has the meaning
given to such term in Section 202(d) hereof.


 


“Depositary” means DTC, together with any
Person succeeding thereto by merger, consolidation or acquisition of all or
substantially all of its assets, including substantially all of its securities
payment and transfer operations.


 


“Distribution Compliance Period” has the
meaning given to such term in Section 202(c) hereof.


 


“DTC” means The Depository Trust Company, a
New York corporation, having a principal office at 55 Water Street, New York,
New York 10041-0099.


 


“Global Securities” has the meaning given to
such term in Section 202(c) hereof.


 


“Indenture” means the Original Indenture, as
supplemented by this First Supplemental Indenture.


 


“Independent
Investment Banker” means one of the Reference Treasury Dealers
appointed by the Trustee after consultation with the Company.


 


“Initial Purchasers” means Credit Suisse
First Boston LLC and CIBC World Markets Corp.


 


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“Institutional Accredited Investor” means an
institutional “accredited investor” as defined in Rule 501(a)(1), (2), (3) and (7) under the Securities Act.


 


“Issue Date” means July 16, 2003, the
date on which the Series A Bonds are originally
issued under this First Supplemental Indenture.


 


“Non-U.S. Person” has the meaning assigned
to such term in Regulation S.


 


“Permanent Regulation S Global Security” has
the meaning given to such term in Section 202(c) hereof.


 


“QIB” has the meaning given to such term in Section 202(d) hereof.


 


“Reference
Treasury Dealer” means each of Credit Suisse First Boston LLC and
Morgan Stanley & Co. Incorporated, and their respective successors;
provided, however, that if any of the foregoing is not a primary U.S.
Government securities dealer in New York City (a “Primary
Treasury Dealer”), the Company will appoint another Primary Treasury
Dealer as a substitute.


 


“Reference
Treasury Dealer Quotations” means, with respect to each Reference
Treasury Dealer and any Redemption Date, the average, as determined by the
Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in writing
to the Trustee by such Reference Treasury Dealer at 5:00 p.m. on the third
business day next preceding such Redemption Date.


 


“Regulation S” means Regulation S
promulgated under the Securities Act.


 


“Regulation S Definitive Security” has the
meaning given to such term in Section 202(d) hereof.


 


“Regulation S Global Security” has the
meaning given to such term in Section 202(c) hereof.


 


“Regulation S Securities” means Series A Bonds offered and sold as part of their initial
distribution to persons outside the United States in accordance with Regulation
S under the Securities Act.


 


“Restricted Definitive Securities” has the
meaning given to such term in Section 202(d) hereof.


 


“Restricted Global Security” has the meaning
given to such term in Section 202(b) hereof.


 


“Restricted Legend” has the meaning given to
such term in Section 206(a) hereof.


 


“Restricted Securities” has the meaning
given to such term in Section 206(a) hereof.


 


“Rule 144A” means Rule 144A under
the Securities Act.


 


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“Rule 144A Definitive Securities” has
the meaning given to such term in Section 202(d) hereof.


 


“Securities Act” means the United States
Securities Act of 1933, as amended.


 


“Series A Bonds” has the meaning given
to such term in Section 201 hereof.


 


“Significant Subsidiary” means any Subsidiary of the Company that would be a “significant
subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such
Regulation is in effect on the Issue Date.


 


“Temporary Regulation S Global Security” has
the meaning given to such term in Section 202(c) hereof.


 


ARTICLE TWO



TITLE, FORM AND TERMS OF THE SERIES A BONDS


 


Section 201.           Title
of the Series A Bonds.  This First Supplemental Indenture hereby
creates a series of Securities designated as the “4.45% First Mortgage Bonds, Series A,
due July 15, 2013” of the Company (the “Series A Bonds”).


 


Section 202.           Form and
Terms of the Series A Bonds.  For purposes of the Original Indenture, the Series A Bonds shall constitute a single series of Securities and
may be issued in an unlimited principal aggregate amount, although the initial
issuance of the Series A Bonds shall be in the principal amount of
$185,000,000.  In accordance with Sections 2.01 and 3.01 of the Original Indenture, this
First Supplemental Indenture hereby provides that the Series A Bonds (x) shall be payable in such amounts and in
the manner as set forth therein (the form of which is substantially as set
forth in Exhibit A attached hereto) and in the Original Indenture
at the rates specified in the Series A Bonds, (y) and shall have the form
and such other terms as set forth in this First Supplemental Indenture, the Series A
Bonds and the Original Indenture (except to the extent specifically provided
for in this First Supplemental Indenture or in the Series A Bonds).


 


(a)  The Series A  Bonds
issued in transactions exempt from registration under the Securities Act shall
be substantially in the form of Exhibit A attached hereto.  The Series A  Bonds may have such notations, legends or
endorsements approved as to form by the Company and required, as applicable, by
law, stock exchange or depository rule, agreements to which the Company is
subject and/or usage.  The terms of the Series A  Bonds
set forth in Exhibit A are herein incorporated by reference and are
part of the terms of this First Supplemental Indenture.


 


(b)  The Series A Bonds offered and sold in
reliance on Rule 144A shall be issued, and will only be available, in the
form of one or more Global Securities substantially in the form of Exhibit A
attached hereto with such applicable legends as are provided for in Section 206
(each, a “Restricted Global Security”)
duly executed by the Company and duly authenticated by the Trustee as herein
provided.  The Restricted Global Security
shall be in definitive, fully registered form without coupons and be registered
in the name of DTC and deposited with BNY Midwest Trust Company, at its
corporate trust office, as custodian for DTC. 
The aggregate principal 


 


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amount of any Restricted
Global Security may from time to time be increased or decreased by adjustments
made on the records of the Trustee, as provided in Section 209 hereof,
which adjustments shall be conclusive as to the aggregate principal amount of
any such Global Security.


 


(c)  The Series A Bonds offered and sold
outside the United States in reliance on Regulation S shall be issued, and
will only be available, initially in the form of one or more temporary global
Securities substantially in the form of Exhibit A hereto with such
applicable legends as are provided for in Sections 206 and 208 (the “Temporary Regulation S Global Security”)
duly executed by the Company and duly authenticated by the Trustee as herein
provided.  Beneficial ownership interests
in the Temporary Regulation S Global Security shall not be exchangeable for
interests in the Restricted Global Security, the permanent Regulation S
Global Securities substantially in the form of Exhibit A hereto
(each, a “Permanent Regulation S Global
Security”) duly executed by the Company and duly authenticated by
the Trustee as herein provided or a Definitive Security prior to the expiration
of the Distribution Compliance period and then only upon certification in
accordance with Rule 903 under the Securities Act, in form reasonably
satisfactory to the Trustee, to the effect that beneficial ownership interests
in such Temporary Regulation S Global Security are owned either by Non-U.S.
Persons or U.S. Persons who purchased such interests in a transaction that did
not require registration under the Securities Act.  The Temporary Regulation S Global Security
and the Permanent Regulation S Global Security are collectively referred to
herein as the “Regulation S Global
Security.”  The
Regulation S Global Securities shall be in definitive, fully registered
form without coupons and be registered in the name of DTC and deposited with
BNY Midwest Trust Company, at its corporate trust office, as custodian for DTC,
for credit initially and during the Distribution Compliance Period to the
respective accounts of beneficial owners of such Series A Bonds (or to
such other accounts as they may direct) at Morgan Guaranty Trust Company of New
York, Brussels office, as operator of Euroclear or Clearstream.  As used herein, the term “Distribution Compliance Period,” with
respect to the Regulation S Global Securities offered and sold in reliance
on Regulation S, means the period of 40 consecutive days beginning on and
including the later of (i) the day on which the Series A Bonds are
first offered to persons other than distributors (as defined in
Regulation S) in reliance on Regulation S and (ii) the Issue
Date.  The aggregate principal amount of
any Regulation S Global Security may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as provided in Section 209
hereof, which adjustments shall be conclusive as to the aggregate principal
amount of any such Global Security.  The
Restricted Global Security and Regulation S Global Security are sometimes
collectively referred to herein as the “Global
Securities.”


 


(d)  Series A
Bonds offered and sold to any Institutional Accredited Investor that is not a
qualified institutional buyer as defined in Rule 144A under the Securities
Act (“QIB”) in a transaction
exempt from registration under the Securities Act (and other than as described
in Section 202(c)) shall be issued substantially in the form of Exhibit A
hereto in definitive, fully registered form without coupons with such
applicable legends as are provided for in Section 206 (the “Restricted Definitive Securities”) duly
executed by the Company and duly authenticated by the Trustee as herein
provided.  Series A
Bonds issued pursuant to Section 208(c) in exchange for interests in
a Regulation S Global Security shall be issued in definitive, fully
registered form without interest coupons (the “Regulation S Definitive Securities”).  Series A Bonds
issued pursuant to Section 208(c) in exchange for interests in a
Restricted Global Security or a


 


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Regulation S Global
Security shall be issued in the form of definitive Global Securities (the “Rule 144A Definitive Securities”).  The Restricted Definitive Securities, the Rule 144A
Definitive Securities and the Regulation S Definitive Securities are
sometimes collectively referred to herein as the “Definitive Securities.”


 


Section 203.           Execution and Authentication.  The Trustee, upon a Company Order and
pursuant to the terms of the Original Indenture and this First Supplemental
Indenture, shall authenticate and deliver Series A
Bonds for original issue in an initial aggregate principal amount of
$185,000,000.  Such Company Order shall
specify the amount of the Series A Bonds to be
authenticated, the date on which the original issue of Series A Bonds is
to be authenticated and the aggregate principal amount of Series A Bonds
outstanding on the date of authentication. 
All of the Series A Bonds issued under the
Indenture shall be treated as a single series for all purposes under the
Indenture, including, without limitation, waivers, amendments, and offers to
purchase.


 


Section 204.           Depositary for Global Securities.  The Depositary for the Series A Bonds shall be DTC.


 


Section 205.           Place
of Payment.  The Place of Payment in
respect of the Series A Bonds will be at the principal office or agency of
the Company in The City of New York, State of New York or at the office or
agency of the Trustee in The City of New York, State of New York which, at the
date hereof, is located at 101 Barclay Street, New York, New York 10286.


 


Section 206.           Legends.


 


(a)           All
Series A Bonds issued pursuant to this First
Supplemental Indenture shall be “Restricted
Securities” and shall bear a legend to the following effect (the “Restricted Legend”) except as permitted by
the following paragraph (b), as appropriate:


 


“THIS SECURITY (OR ITS
PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.  EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION
FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER.


 


THE HOLDER OF THIS
SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS SECURITY MAY BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED
STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER
THE SECURITIES


 


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ACT, (III) PURSUANT
TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE) OR (IV) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH
(IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE.”


 


Each Restricted
Definitive Security shall bear the following legend on the face thereof:


 


“IN CONNECTION WITH ANY
TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH
CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.”


 


Each Temporary Regulation
S Global Security shall bear the following legend on the face thereof:


 


“EXCEPT AS SET FORTH
BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL
SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN THE PERMANENT REGULATION S
GLOBAL SECURITY OR ANY OTHER SECURITY REPRESENTING AN INTEREST IN THE
SECURITIES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND CONTAINING
RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF THE “40-DAY DISTRIBUTION
COMPLIANCE PERIOD” (WITHIN THE MEANING OF RULE 903(B)(2) OF
REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN
FORM REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS
ARE OWNED EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS
IN A TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES
ACT.  DURING SUCH 40-DAY DISTRIBUTION
COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP IN THIS TEMPORARY REGULATION S GLOBAL
SECURITY MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED THROUGH EUROCLEAR SYSTEM
OR CLEARSTREAM BANKING, S.A. AND ONLY (1) TO THE COMPANY, (2) WITHIN
THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (3) OUTSIDE
THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT OR (4) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT, IN EACH OF CASES (1) THROUGH (4) IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND OTHER
JURISDICTIONS.  HOLDERS OF INTERESTS IN
THIS TEMPORARY REGULATIONS S GLOBAL SECURITY WILL


 


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NOTIFY ANY PURCHASER OF
THIS SECURITY OF THE RESALE RESTRICTIONS REFERRED TO ABOVE, IF THEN APPLICABLE.


 


BENEFICIAL INTERESTS IN
THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR
INTERESTS IN A RESTRICTED GLOBAL SECURITY ONLY IF (1) SUCH EXCHANGE OCCURS
IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE WITH
RULE 144A, AND (2) THE TRANSFEROR OF THE TEMPORARY REGULATION S
GLOBAL SECURITY FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED
TO THIS CERTIFICATE) TO THE EFFECT THAT THE REGULATION S GLOBAL SECURITY
IS BEING TRANSFERRED (A) TO A PERSON WHO THE TRANSFEROR REASONABLY
BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A, (B) TO A PERSON WHO IS PURCHASING FOR ITS OWN ACCOUNT OR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A AND (C) IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.


 


BENEFICIAL INTERESTS IN A
RESTRICTED GLOBAL SECURITY MAY BE TRANSFERRED TO A PERSON WHO TAKES
DELIVERY IN THE FORM OF AN INTEREST IN THE REGULATION S GLOBAL
SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE 40-DAY DISTRIBUTION
COMPLIANCE PERIOD, ONLY IF THE TRANSFEROR FIRST DELIVERS TO THE TRUSTEE A
WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE
EFFECT THAT IF SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR
904 OF REGULATION S OR RULE 144 (IF AVAILABLE) AND THAT, IF SUCH
TRANSFER OCCURS PRIOR TO THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE
PERIOD, THE INTEREST TRANSFERRED WILL BE HELD IMMEDIATELY THEREAFTER THROUGH
EUROCLEAR SYSTEM OR CLEARSTREAM BANKING, S.A.”


 


(b)           Upon
any sale or transfer of a Restricted Security pursuant to Rule 144 under
the Securities Act, the Depositary shall, subject to approval by the Company
and the provisions of Section 3.05 of the Original Indenture, permit the
Holder thereof to request the issuance of a Series A Bond that does not
bear one or more of the legends set forth above and rescind any restrictions on
the transfer of such Restricted Security, if the sale or exchange was made in
reliance on Rule 144 and the Holder certifies to that effect in writing to
the Depositary.


 


Section 207.           Restrictions
on Transfer and Exchange of Series A Bonds.


 


All Series A Bonds issued upon any registration of transfer or exchange
of Series A Bonds shall be valid obligations of the Company, evidencing
the same interest therein, and entitled to the same benefits under the Original
Indenture and this First Supplemental Indenture, as the Series A Bonds
surrendered upon such registration of transfer or exchange.


 


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A Holder may transfer a Series A
Bond, or request that a Series A Bond be exchanged for Series A Bonds
in authorized denominations and in an aggregate principal amount equal to the
principal amount of such Series A Bond surrendered for exchange of other
authorized denominations, by surrender of such Series A Bonds to the
Trustee with the form of transfer notice thereon duly completed and executed,
and otherwise complying with the terms of the Original Indenture and this First
Supplemental Indenture, including providing evidence of compliance with any
restrictions on transfer, in form satisfactory to the Company, the Trustee and
the Security Registrar.  No such transfer
shall be effected until, and such transferee shall succeed to the rights of a
Holder only upon, final acceptance and registration of the transfer by the Security
Registrar in the Security Register. 
Prior to the registration of any transfer of a Series A Bond by a
Holder as provided herein, the Company, the Security Registrar, the Paying
Agent and the Trustee shall deem and treat the person in whose name the Series A
Bond is registered on the Security Register as the absolute owner and holder
thereof for the purpose of receiving payment of all amounts payable with
respect to such Series A Bond and for all other purposes, and none of the
Company, the Security Registrar, the Paying Agent or the Trustee shall be
affected by any notice to the contrary. 
Furthermore, DTC shall, by acceptance of a Global Security, agree that
transfers of beneficial interests in such Global Security may be effected only through a book-entry system maintained by DTC
(or its agent) and that ownership of a beneficial interest in the Global
Security shall be required to be reflected in a book-entry.  When Series A Bonds are presented to the
Security Registrar with a request to register the transfer thereof or to
exchange them for other authorized denominations of a Series A Bond in a
principal amount equal to the aggregate principal amount of Series A Bonds
surrendered for exchange, the Security Registrar shall register the transfer or
make the exchange as requested if its requirements for such transactions are
met.


 


To permit registrations
of transfers and exchanges in accordance with the terms, conditions and
restrictions hereof, the Company shall execute, and the Trustee shall
authenticate, Series A Bonds at the Security Registrar’s
request.  No service charge shall be made
to a Holder for any registration of transfer or exchange of Series A Bonds, but the Company may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Series A Bonds.  All Series A
Bonds surrendered for registration of transfer or exchange shall be cancelled
by the Trustee in accordance with its then customary procedures.


 


Section 208.           Book-Entry Provisions for Restricted Global Securities and
Regulation S Global Securities.


 


(a)           Members
of, or participants in, DTC (“Agent Members”)
shall have no rights under the Original Indenture, this First Supplemental
Indenture and the Series A Bonds with respect to any Global Security held
on their behalf by DTC, or BNY Midwest Trust Company as its custodian, and DTC
may be treated by the Company, the Trustee and any agent of the Trustee as the
absolute owner of such Global Security for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein
shall prevent the Company, the Trustee or any agent of the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
DTC or shall impair, as between DTC and its Agent Members, the operation of
customary practices governing the exercise of the rights of a holder of any
Global Security.  Upon the issuance of
any


 


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Global Security, the
Security Registrar or its duly appointed agent shall record DTC as the
registered holder of such Global Security.


 


(b)           Transfers
of any Global Security shall be limited to transfers of such Restricted Global
Security or Regulation S Global Security in whole, but not in part, to
DTC.  Each Global Security shall bear the
following legend:


 


“UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON MADE TO
CEDE & CO.), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN. 
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.”


 


Beneficial interests in
the Restricted Global Security and any Regulation S Global Security may be
transferred in accordance with the rules and procedures of DTC and the
provisions of Section 209.


 


(c)           Beneficial
interests in a Restricted Global Security or a Regulation S Global
Security shall be delivered to all beneficial owners thereof in the form of Rule 144A
Definitive Securities or Regulation S Definitive Securities, as the case
may be, if (i) DTC notifies the Trustee that it is unwilling or unable to
continue as depositary for such Restricted Global Security or Regulation S
Global Security, as the case may be, and a successor depositary is not
appointed by the Trustee within 90 days of such notice, and (ii) after the
occurrence and during the continuance of an Event of Default, owners of
beneficial interests in a Global Security with a principal amount aggregating
not less than a majority of the outstanding principal amount of the Global
Security advise the Trustee, the Company and DTC through Agent Members in
writing that the continuation of a book-entry system through DTC or its
successor is no longer in their best interests.


 


(d)           Any
beneficial interest in one of the Global Securities that is transferred to a
Person who takes delivery in the form of an interest in another Global Security
will, upon such transfer, cease to be an interest in such Global Security and
become an interest in the other Global Security and, accordingly, will
thereafter be subject to all transfer restrictions, if any, and other
procedures applicable to beneficial interests in such other Global Security for
as long as it remains such an interest.


 


10





















 


(e)           In
connection with the transfer of an entire Restricted Global Security or an
entire Regulation S Global Security to the beneficial owners thereof
pursuant to paragraph (c) of this Section 208, such Restricted Global
Security or Regulation S Global Security, as the case may be, shall be
deemed to be surrendered to the Trustee for cancellation, and the Company shall
execute, and the Trustee shall authenticate, to each beneficial owner
identified by DTC in exchange for its beneficial interest in such Restricted
Global Security or Regulation S Global Security, as the case may be, an
equal aggregate principal amount of Rule 144A Definitive Securities or
Regulation S Definitive Securities, as the case may be, of authorized
denominations.  None of the Company, the
Security Registrar, the Paying Agent or the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such registration instructions.  Upon the issuance of Rule 144A
Definitive Securities or Regulation S Definitive Securities, as the case
may be, the Company and the Trustee shall recognize the Person in whose name
the Rule 144A Definitive Securities or Regulation S Definitive
Securities, as the case may be, are registered in the Security Register as
Holders hereunder.


 


(f)            Any
Rule 144A Definitive Securities or Regulation S Definitive
Securities, as the case may be, delivered in exchange for an interest in the
Restricted Global Security pursuant to paragraph (c) of this Section 208
shall, except as otherwise provided by paragraph (e) of Section 209,
bear the Restricted Legend.


 


(g)           Prior
to the expiration of the Distribution Compliance Period, any Regulation S
Definitive Security delivered in exchange for an interest in a
Regulation S Global Security pursuant to paragraph (c) of this Section 208
shall bear the Restricted Legend.


 


(h)           The
registered holder of any Restricted Global Security or Regulation S Global
Security may grant proxies and otherwise authorize any Person, including Agent
Members and Persons that may hold interests through Agent Members, to take any
action which a Holder is entitled to take under the Original Indenture or this
First Supplemental Indenture or the Series A
Bonds.


 


(i)            Neither
the Company nor the Trustee shall be liable if the Trustee or the Company is
unable to locate a qualified successor clearing agency.


 


Section 209.           Special Transfer Provisions.


 


The following provisions
shall also apply to the Series A Bonds:


 


(a)           Transfers
to Non-QIB Institutional Accredited Investors.  The following provisions shall apply with
respect to the registration of any proposed transfer of a Series A Bond to any Institutional Accredited Investor that is
neither a QIB nor a Non-U.S. Person:


 


(i)            The Security Registrar shall register the transfer
of any Series A Bond, whether or not bearing the Restricted Legend, only
if (x) the requested transfer is at least two years after the later of the
(A) Issue Date and (B) the last date on which such Series A Bond
was held by the Company or any affiliate of the Company or (y) the
proposed transferor is an Initial Purchaser who is transferring Series A
Bonds purchased under the purchase agreement therefor and the proposed
transferee has delivered to the


 


11





















 


Security Registrar a letter substantially in the form of Exhibit C
hereto and the aggregate principal amount of the Series A
Bonds being transferred is at least $100,000. 
Except as provided in the foregoing sentence, the Registrar shall not
register the transfer of any Series A Bond to any
Institutional Accredited Investor that is neither a QIB nor a Non-U.S. Person.


 


(ii)           If the proposed transferor is an Agent Member holding a beneficial
interest in a Restricted Global Security, upon receipt by the Security
Registrar of (x) the documents, if any, required by paragraph (i) and
(y) instructions given in accordance with DTC’s and the Security Registrar’s
procedures, the Security Registrar shall reflect on its books and records the
date of the transfer and a decrease in the principal amount of such Restricted
Global Security in an amount equal to the principal amount of the beneficial
interest in such Restricted Global Security to be transferred, and the Company
shall execute and the Trustee shall authenticate and deliver to the transferor
or at its direction, one or more Restricted Definitive Securities of like tenor
and amount.


 


(b)           Transfers
to QIBs.  The following provisions
shall apply with respect to the registration of any proposed transfer of a Series A Bond to a QIB (excluding Non-U.S. Persons):


 


(i)            If the Series A Bond to be transferred
consists of a Restricted Definitive Security, or of an interest in any
Regulation S Global Security during the Distribution Compliance Period,
the Security Registrar shall register the transfer if such transfer is being
made by a proposed transferor who has checked the box provided for on the form
of Series A Bond stating, or has otherwise advised the Company, the
Trustee and the Security Registrar in writing, that the sale has been made in
compliance with the provisions of Rule 144A to a transferee who has signed
the certification provided for on the form of Series A Bond stating, or
has otherwise advised the Company, the Trustee and the Security Registrar in
writing, that it is purchasing the Series A Bond for its own account or an
account with respect to which it exercises sole investment discretion and that
it, or the Person on whose behalf it is acting with respect to any such
account, is a QIB within the meaning of Rule 144A, and is aware that the
sale to it is being made in reliance on Rule 144A and acknowledges that it
has received such information regarding the Company as it has requested
pursuant to Rule 144A or has determined not to request such information
and that it is aware that the transferor is relying upon its foregoing
representations in order to claim the exemption from registration provided by Rule 144A.


 


(ii)           Upon receipt by the Security Registrar of the documents required by
clause (i) above and instructions given in accordance with DTC’s and
the Security Registrar’s procedures therefor, the Security Registrar shall
reflect on its books and records the date of such transfer and an increase in
the principal amount of a Restricted Global Security in an amount equal to the principal
amount of the Restricted Definitive Securities or interests in such
Regulation S Global Security, as the case may be, being transferred, and
the Trustee shall cancel such Definitive Securities or decrease the amount of
such Regulation S Global Security so transferred.


 


12





















 


(c)           Transfers
of Interests in the Temporary Regulation S Global Security, the Permanent
Regulation S Global Security or the Regulation S Definitive Securities.


 


(i)            After the expiration of the Distribution Compliance
Period, the Security Registrar shall register any transfer of interests in any
Regulation S Global Security or Regulation S Definitive Security
without requiring any additional certification.


 


(ii)           Until the expiration of the Distribution Compliance Period, interests in
the Temporary Regulation S Global Security may only be sold, pledged or
transferred through Morgan Guaranty Trust Company of New York, Brussels Office,
as operator of the Euroclear System (“Euroclear”)
or Clearstream Luxembourg, a société anonyme (“Clearstream”) (as indirect participants in the Depositary) or
Agent Members acting for and on behalf of Euroclear and Clearstream only (x)
for interests in a Permanent Regulation S Global Security and then only upon
certification in form reasonably satisfactory to the Trustee that interests in
such Temporary Regulation S Global Security are owned by either Non-U.S.
Persons or U.S. Persons who purchased such interests in a transaction that did
not require registration under the Securities Act or (y) for interests in the
Restricted Global Security if the transferor first delivers to the Trustee a
written transfer notice to the effect that the Series A Bonds are being
transferred to a person (A) who the transferor reasonably believes to be a
QIB; (B) purchasing for its own account or the account of a QIB in a
transaction meeting the requirements of Rule 144A; and (C) in
accordance with all applicable securities laws of the states of the United
States and other jurisdictions.


 


(d)           Transfers
to Non-U.S. Persons at Any Time.  The
following provisions shall apply with respect to any registration of any
transfer of a Series A Bond to a Non-U.S. Person:


 


(i)            Prior to the expiration of the Distribution
Compliance Period, the Security Registrar shall register any proposed transfer
of a Series A Bond to a Non-U.S. Person upon
receipt of a certificate substantially in the form set forth as Exhibit B
hereto from the proposed transferor.


 


(ii)           After the expiration of the Distribution Compliance Period, the Security
Registrar shall register any proposed transfer to any Non-U.S. Person if the Series A Bond to be transferred is a Restricted Definitive Security
or an interest in a Restricted Global Security, upon receipt of a certificate
substantially in the form of Exhibit B from the proposed
transferor.  The Security Registrar shall
promptly send a copy of such certificate to the Company.


 


(iii)          Upon receipt by the Security Registrar of (x) the documents, if any,
required by clause (ii) and (y) instructions in accordance with
DTC’s and the Security Registrar’s procedures, the Security Registrar shall
reflect on its books and records the date of such transfer and a decrease in
the principal amount of such Restricted Global Security in an amount equal to
the principal amount of the beneficial interest in such Restricted Global
Security to be transferred, and, upon receipt by the Security Registrar of
instructions given in accordance with DTC’s and the Security Registrar’s
procedures, the Security Registrar shall reflect on its books and records the
date and an increase in the


 


13





















 


principal amount of the Regulation S Global Security in an amount
equal to the principal amount of the Restricted Definitive Security or the
Restricted Global Security, as the case may be, to be transferred, and the
Trustee shall cancel the Definitive Security, if any, so transferred or
decrease the amount of such Restricted Global Security.


 


(e)           Restricted
Legend.  Upon the transfer, exchange
or replacement of Series A Bonds not bearing the
Restricted Legend, the Security Registrar shall deliver Series A Bonds
that do not bear the Restricted Legend. 
Upon the transfer, exchange or replacement of Series A Bonds
bearing the Restricted Legend, the Security Registrar shall deliver only Series A
Bonds that bear the Restricted Legend unless either (i) the circumstances
contemplated by paragraph (d)(ii) of this Section 209 exist or (ii) there
is delivered to the Security Registrar an opinion of counsel to the effect that
neither such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act.


 


(f)            General.  By acceptance of any Series A Bond
bearing the Restricted Legend, each Holder of such Series A Bond
acknowledges the restrictions on transfer of such Series A Bond set forth
in such Restricted Legend and otherwise in this First Supplemental Indenture
and agrees that it will transfer such Series A Bond only as provided in
such Restricted Legend and otherwise in this First Supplemental Indenture.  In connection with any transfer of Series A
Bonds, each Holder agrees by its acceptance of the Series A Bonds to
furnish the Security Registrar or the Trustee such certifications, legal
opinions or other information as either of them may reasonably require to
confirm that such transfer is being made pursuant to an exemption from, or a
transaction not subject to, the registration requirements of the Securities Act
and in accordance with the terms and provisions of this Article Two;
provided that the Security Registrar shall not be required to determine the
sufficiency of any such certifications, legal opinions or other information.


 


Until such time as no Series A Bonds remain Outstanding, the Security Registrar shall
retain copies of all letters, notices and other written communications received
pursuant to Section 208 or this Section 209.  The Trustee, if not the Security Registrar at
such time, shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Security Registrar.


 


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


 


Until definitive Series A Bonds are ready for delivery, the Company may use
temporary Series A Bonds.  Temporary
Series A Bonds shall be substantially in the form
of definitive Series A Bonds but may have variations that the Company
considers appropriate for temporary


 


14





















 


Series A Bonds.  Without
unreasonable delay, the Company shall deliver definitive Series A Bonds in exchange for temporary Series A Bonds.


 


The Company may issue
some or all of the Securities in temporary or permanent global form.  The Company may issue a Global Security only
to the Depositary.  A Depositary may transfer
a Global Security only to its nominee or to a successor Depository.  A Global Security shall represent the amount
of Series A Bonds specified in the Global
Security.  A Global Security may have
variations that the Depositary requires or that the Company considers appropriate
for such a security.


 


Beneficial owners of part
or all of a Global Security are subject to the rules of the Depository as
in effect from time to time.


 


The Company, the Trustee
and their agents shall not be responsible for any acts or omissions of a Depositary,
for any Depository records of beneficial ownership interests or for any
transactions between or among the Depositary, Agent Members and beneficial
owners.


 


The Company at any time
may deliver Series A Bonds to the Trustee for
cancellation.  The Paying Agent, if not
the Trustee, shall forward to the Trustee any Series A
Bonds surrendered to them for payment or conversion.  The Trustee shall cancel all Series A Bonds surrendered for registration of transfer, exchange,
payment or cancellation and shall dispose of cancelled Series A Bonds
according to its then customary practices. 
The Company may not issue new Series A
Bonds to replace Series A Bonds that it has paid or which have been
delivered to the Trustee for cancellation.


 


ARTICLE THREE 



REDEMPTION


 


The Series A Bonds
may be redeemed, in accordance with the procedures set forth in the Original
Indenture, on not less than 30 nor more than 60 days’ notice prior to the
Redemption Date to the Holders, given as provided in the Original Indenture, as
a whole or in part, at any time at the option of the Company, at a Redemption
Price equal to the greater of (i) 100% of the principal amount of the Series A
Bonds being redeemed and (ii) as determined by an Independent Investment
Banker, the sum of the present values of the remaining scheduled payments of
principal and interest thereon (not including any portion of such payments of
interest accrued as of the Redemption Date) discounted to the Redemption Date
on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day
months) at the Adjusted Treasury Rate, plus, in each case, accrued and unpaid
interest thereon to, but excluding, the Redemption Date; provided, however,
that installments of interest on the Series A Bonds that are due and payable
on an interest payment date falling on or prior to the relevant Redemption Date
will be payable to the Holders of such Series A Bonds registered as such
at the close of business on the relevant record date according to the terms and
provisions of the Original Indenture.


 


In the event of a partial
redemption of the Series A Bonds, the Company
will issue new Series A Bonds for the unredeemed portion in the name of
each Holder of the partially redeemed Series A Bonds.


 


15





















 


If less than all of the Series A
Bonds are to be redeemed, the Series A Bonds will be redeemed by lot, pro
rata by the Trustee or by such method of selection as the Trustee shall deem
fair and appropriate and which may, in any case, provide for the selection for
redemption of Series A Bonds and portions of Series A Bonds in
amounts of $1,000 or any integral multiples of $1,000 in excess thereof.


 


Unless the Company
defaults in payment of the Redemption Price, the portion of Series A Bonds called for redemption will no longer accrue interest
on and after the Redemption Date.


 


ARTICLE FOUR



MAINTENANCE AND RENEWAL


 


(a)           The
Company covenants and agrees that, so long as any of the Series A Bonds
are Outstanding, the Company will expend during each calendar year, and certify
to the Trustee in an Officer’s Certificate, an amount not less than 2.00% of
the average amount of depreciable property of the Company at the beginning and
at the end of such calendar year for one or more of the following purposes:


 


(i)            capital expenditures for the maintenance and repair of the
utility properties of the Company subject to the Lien of the Original
Indenture;


 


(ii)           the construction or acquisition of Property Additions on
which the Original Indenture is a first Lien, subject only to Permitted Liens
and Prepaid Liens; or


 


(iii)          the retirement, through purchase, payment or redemption, of
Securities issued under and secured by the Indenture (including any future
supplemental indenture pursuant to the Original Indenture).


 


(b)           The
term “amount of depreciable property” shall mean as of any date the amount of
Property Additions included at such date on the books of the Company which is
depreciable, as determined in accordance with generally accepted accounting
principles in the United States.  The
average of the amount of depreciable property shall mean the arithmetical
average of the amount of depreciable property at the beginning, and the amount
thereof at the end, of such calendar year. 
Partial years shall be prorated.


 


If, in any calendar year,
the required expenditures for the foregoing purposes are not made, the Company
shall deposit with the Trustee on or before the first day of February next
succeeding the close of such calendar year a sum in cash to the extent of any
deficiency, after deducting (subject to the terms of the Indenture) any
eligible credit for unused excess expenditures previously made for such
purposes.  Such cash may be applied to
the redemption at the applicable Redemption Price, or to the repurchase, of
Securities, or may be withdrawn to the extent of 100% of Property Additions.


 


(c)           Excess
expenditures in any calendar year may be used to comply with the requirements
of any subsequent year or years and Property Additions may be certified to
comply with the provisions of clause (b) above; provided, that
Property Additions so used, and Securities


 


16





















 


retired through
expenditures so used, cannot be used for other purposes under this First
Supplemental Indenture; provided, further that, (i) no Retired Securities
or expenditures for Funded Property which shall have been made the basis for
authentication of Securities or the release of Mortgaged Property or the
withdrawal of deposited cash or Securities or any other amounts under any other
provision of the Indenture, or which shall have been made out of any insurance
moneys or moneys received from the condemnation, sale or other disposition of
any of the Company’s property subject to the Lien of the Indenture, or which
shall have previously been used or applied or certified to the Trustee to
comply with this Article Four or any other provision of the Indenture and (ii) no
retirement of Securities which shall have been made with moneys applied to such
purpose pursuant to any provision of this Article Four or of Section 4.04
or 8.06 of the Original Indenture, shall be certified or used or applied for
the purpose of complying with this Article or withdrawing any moneys paid
to the Trustee pursuant to this Article. 
This Article shall not require the annual retirement by the Company
of any specific amount of Outstanding Securities.


 


(d)           So
long as any of the Series A Bonds are Outstanding, on or before the first
day of February of each year beginning February 1, 2004, the Company
shall deliver to the Trustee an Officer’s Certificate showing in reasonable
detail:  (1) the Company’s
expenditures pursuant to each of subclauses (a)(i), (a)(ii) and (a)(iii) above,
or otherwise deposited with the Trustee pursuant to this Article, (2) any
eligible credit for excess expenditures from prior periods and the extent to
which the Company elects to have such excess applied to the period next
preceding delivery of such Officer’s Certificate, and (3) the amount of
cash the Company is depositing with the Trustee concurrently with the delivery
of such Officer’s Certificate to comply with the requirements of this Article Four.  Such Officer’s Certificate shall also state
that it complies with the requirements of this Article Four.


 


(e)           At
the option of the Company, any moneys paid to and held by the Trustee under the
provisions of subclause (b) of this Section shall, upon the
written request of the Company pursuant to an Officer’s Certificate, (1) be
applied by the Trustee to the purchase in the open market of Securities of any
series, at not exceeding the then applicable Redemption Price, if any, at which
Securities of said series may then be redeemed or (2) be paid to or upon
the order of the Company to the extent of (i) the principal amount of
Securities of said series purchased or paid by the Company and delivered to the
Trustee, cancelled or for cancellation and (ii) the accrued interest and
the premium, if any, theretofore paid to the Trustee, as hereinabove provided,
on such principal amount of Securities. 
The Company hereby covenants and agrees that it will pay to the Trustee
from time to time in cash such additional sums, if any, as shall be paid or
required to be paid by the Trustee as or for accrued interest and premium, if
any, in respect of any Securities purchased or redeemed pursuant to the
provisions of this Section.


 


(f)            Any
and all Securities, the retirement (through payment or purchase) of which shall
be certified to the Trustee in compliance with the provisions of this Article,
shall be delivered to the Trustee at or before the time the same shall be so
certified and shall thereupon be cancelled and destroyed by the Trustee, unless
theretofore cancelled and destroyed.  All
other Securities received by the Trustee pursuant to any provision of this Article shall
thereupon be cancelled and destroyed by the Trustee.


 


17





















 


ARTICLE FIVE



REPORTS


 


In addition to the
reports the Company must provide pursuant to the Original Indenture, the
Company hereby covenants and agrees that:


 


(a)           whether
or not required by the Commission, so long as any Series A Bonds are
outstanding, the Company shall mail to the Trustee and the Holders, within the
time periods specified in the Commission’s rules and regulations all
quarterly and annual financial information that would be required to be
contained in a filing with the Commission on Forms 10-Q and 10-K if the
Company were required to file such Forms, including a “Management’s Discussion
and Analysis of Financial Condition and Results of Operations” and, with
respect to the annual information only, a report on the annual financial
statements by the Company’s certified independent accountants; provided, that
with respect to the fiscal quarter of the Company ending June 30, 2003,
the Company will not be required to provide such quarterly information until September 30,
2003;


 


(b)           whether
or not required by the Commission, so long as any Series A Bonds are
outstanding, the Company shall mail to the Trustee and the Holders, within 5
calendar days of the occurrence thereof, an Officers’ Certificate providing
notice of any of the following events, including in reasonable detail a summary
of such event or events and the Company’s plans in respect thereof, if any:


 


(1)           any
change of control of the Company, including the name of the Person(s) acquiring
control, the amount and source of the consideration used, the basis of the
control, the date and description of the transaction resulting in the change of
control, the percentage of beneficial ownership of voting securities of the
Company owned by the Person gaining control, the identity of the Person from
whom control was assumed and the effect of such change of control, if any, on
any material agreements or arrangements of the Company;


 


(2)           any acquisition or disposition of any significant assets of
the Company or any of its Subsidiaries, whether in one transaction or a series
of related transactions;


 


(3)           any bankruptcy or receivership of the Company or any direct
or indirect parent of the Company;


 


(4)           any change in the Company’s or any of its Significant
Subsidiaries’ auditors;


 


(5)           any resignation of any director of the Company;


 


(6)           any change in the fiscal year of the Company; and


 


(7)           information with respect to the Company’s results of
operations, financial condition or prospects which, in the reasonable judgment
of the Company, would be material to a Holder;


 


18





















 


provided, that at such
time as the Company is required to file reports on Form 8-K, the Company
shall mail to the Trustee and the Holders, within the time periods specified in
the Commission’s rules and regulations the information required in current
reports on Form 8-K that are required to be filed with the Commission in
lieu of the information preceding this proviso of this clause (b);


 


(c)           following
the filing of any information with the Commission, the Company shall make such
information available to prospective investors in any Series A Bonds upon
their request; and


 


(d)           furnish
to the Holders and to prospective investors in the Series A Bonds, upon
the request of such Holders, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act so long as the Series A
Bonds are not freely transferable under the Securities Act.


 


At the request of the
Company, the Trustee shall assist the Company in the mailing to Holders of any
of the aforesaid information, reports and certificates pursuant to
clauses (a), (b) and/or (c) above.  If the Trustee delivers the foregoing
information to the Holders on behalf of the Company, the Company shall not be
required to deliver such information. 
Should the Company deliver to the Trustee any such information, reports
or certificates or any annual reports, information, documents and other reports
pursuant to Section 314(a) of the Trust Indenture Act (if this First
Supplemental Indenture shall become qualified and subject to the Trust
Indenture Act), delivery of such information, reports and certificates, or such
annual reports, information, documents and other reports to the Trustee is for
informational purposes only and the Trustee’s receipt of such shall not
constitute notice or constructive notice of any information contained therein
or determinable from information contained therein, including the Company’s
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officer’s Certificates).


 


ARTICLE SIX



NET EARNINGS CERTIFICATE


 


Notwithstanding Section 1.04
or any other provision of the Original Indenture, the Net Earnings Certificate
delivered in connection with the initial issuance of Series A Bonds on the Issue Date shall be made and signed by an
Accountant if it is not signed by an independent public accountant.


 


ARTICLE SEVEN



LIEN


 


The Series A Bonds are entitled to the benefit of the Lien under the
Indenture, including, without limitation, the Lien on the property referred to
in Exhibit A to the Original Indenture (which is attached hereto as Exhibit D).


 


19





















 


ARTICLE EIGHT


 


MISCELLANEOUS
PROVISIONS


 


The Trustee makes no
undertaking or representations in respect of, and shall not be responsible in
any manner whatsoever for and in respect of, the validity or sufficiency of
this First Supplemental Indenture, the Series A Bonds or the proper
authorization 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. 
The Trustee shall not be accountable for the use or the application by
the Company of the Series A Bonds or of the
proceeds thereof.


 


Except as expressly
amended and supplemented hereby, the Original Indenture shall continue in full
force and effect in accordance with the provisions thereof and the Original
Indenture is in all respects hereby ratified and confirmed.  This First Supplemental Indenture and all of
its provisions shall be deemed a part of the Original Indenture in the manner
and to the extent herein and therein provided.


 


This First Supplemental Indenture and the Series A
Bonds shall be governed by and construed in accordance with the law of the
State of New York, except, if this First Supplemental Indenture shall become
qualified and shall become subject to the Trust Indenture Act, to the extent
that the Trust Indenture Act shall be applicable, and except to the extent that
the law of any jurisdiction wherein any portion of the Mortgaged Property is
located shall mandatorily govern the creation of a mortgage lien on and
security interest in, or perfection, priority or enforcement of the Lien of the
Indenture or exercise of remedies with respect to, such portion of the
Mortgaged Property.


 


This First 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.


 


20





















 


IN WITNESS WHEREOF, the
parties hereto have caused this First Supplemental Indenture to be duly
executed as of the day and year first above written.


 


	
   

  	
  INTERNATIONAL
  TRANSMISSION

  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BNY MIDWEST TRUST
  COMPANY, as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Roxane Ellwanger

  	
   

  
	
   

  	
   

  	
  Title:  Assistant Vice President

  	
   

  



 





















 


	
  STATE OF MICHIGAN

  	
  )

  
	
   

  	
  ) ss.:

  
	
  COUNTY OF

  	
  )

  



 


On this                 
day of                 
2003, before me personally appeared                                     ,
to me known to be                                               
of INTERNATIONAL TRANSMISSION COMPANY, one of the corporations that executed
the within and foregoing instrument, and acknowledged said instrument to be the
free and voluntary act and deed of said Corporation, for the uses and purposes
therein mentioned, and on oath stated that he was authorized to execute said
instrument and that the seal affixed, if any, is the corporate seal of said
Corporation.


 


On the         
day of                 
in the year          before me
personally came                                     
to me known, who, being by me duly sworn, did depose and say that he resides at
                                                              ;
that he is                                                           
of INTERNATIONAL TRANSMISSION COMPANY, the corporation described in and which
executed the above instrument; and that he signed his name thereto by authority
of the board of directors of said corporation.


 


IN WITNESS WHEREOF, I have hereunto set my hand and
affixed my official seal the day and year first above written.


 


 


	
   

  	
   

  
	
   

  	
  , Notary Public

  
	
   

  	
  , County, Michigan

  
			



 


	
  My Commission expires:

  	
   

  	
   

  



 





















 


	
  STATE OF ILLINOIS

  	
  )

  
	
   

  	
  ) ss.:

  
	
  COUNTY OF COOK

  	
  )

  



 


On the day of July in the year 2003 before me,
the undersigned, personally appeared Roxane Ellwanger, Assistant Vice President
of BNY Midwest Trust Company, personally known to me or proved to me on the
basis of satisfactory evidence to be the individual whose name is subscribed to
the within instrument and acknowledged to me that she executed the same in her
capacity, and that by her signature on the instrument, the individual or the
person upon behalf of which the individual acted, executed the instrument.


 


 


	
   

  	
   

  
	
  Print Name: A. Hernandez

  



 


Notary Public in and for
the State of Illinois

Commission expires:  July 8, 2006


 


Drafted by:

Milbank, Tweed, Hadley & McCloy LLP

1 Chase Manhattan Plaza

New York, New York 10005


 


When recorded
return to:

BNY Midwest Trust Company

2 N. LaSalle Street, Suite 1020

Chicago, Illinois 60630

Attention: Corporate Trust Administration/Roxane Ellwanger


 





















 


EXHIBIT A


 


[FORM OF FACE
OF SERIES A BONDS]


 


[UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON MADE TO
CEDE & CO.), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN. 
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.]*


 


[THIS SECURITY (OR ITS
PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM.  EACH PURCHASER OF THIS SECURITY IS HEREBY
NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION
FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER.


 


THE HOLDER OF THIS
SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS SECURITY MAY BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED
STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN
A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER
THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR
(IV) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS


 










*                To
be included on the face of each Global Security.


 


A-1





















 


REQUIRED TO, NOTIFY ANY
PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.]**


 


[IN CONNECTION WITH ANY
TRANSFER, THE HOLDER WILL DELIVER TO THE SECURITY REGISTRAR AND TRANSFER AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.]***


 


[EXCEPT AS SET FORTH
BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL
SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN THE PERMANENT REGULATION S
GLOBAL SECURITY OR ANY OTHER SECURITY REPRESENTING AN INTEREST IN THE
SECURITIES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND CONTAINING
RESTRICTIONS ON TRANSFER, UNTIL THE EXPIRATION OF THE “40-DAY DISTRIBUTION
COMPLIANCE PERIOD” (WITHIN THE MEANING OF RULE 903(B)(2) OF
REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN
FORM REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS
ARE OWNED EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH
INTERESTS IN A TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE
SECURITIES ACT.  DURING SUCH 40-DAY
DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP IN THIS TEMPORARY
REGULATION S GLOBAL SECURITY MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED
THROUGH EUROCLEAR SYSTEM OR CLEARSTREAM BANKING, S.A. AND ONLY (1) TO THE
COMPANY, (2) WITHIN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (3) OUTSIDE THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH
RULE 904 UNDER THE SECURITIES ACT OR (4) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (1) THROUGH
(4) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES AND OTHER JURISDICTIONS. 
HOLDERS OF INTERESTS IN THIS TEMPORARY REGULATIONS S GLOBAL SECURITY
WILL NOTIFY ANY PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS REFERRED
TO ABOVE, IF THEN APPLICABLE.


 


BENEFICIAL INTERESTS IN
THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR
INTERESTS IN A RESTRICTED GLOBAL SECURITY ONLY IF (1) SUCH EXCHANGE OCCURS
IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE WITH
RULE 144A, AND (2) THE TRANSFEROR OF THE TEMPORARY REGULATION S
GLOBAL SECURITY FIRST DELIVERS TO THE


 










**              To
be included on the face of each Restricted Security and Rule 144A Definitive
Security.


 


***             To
be included on the face of each Restricted Definitive Security and Rule 144A
Definitive Security.


 


A-2





















 


TRUSTEE A WRITTEN
CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT
THE REGULATION S GLOBAL SECURITY IS BEING TRANSFERRED (A) TO A PERSON
WHO THE TRANSFEROR REASONABLY BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A, (B) TO A PERSON WHO IS PURCHASING
FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A AND (C) IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES AND OTHER JURISDICTIONS.


 


BENEFICIAL INTERESTS IN A
RESTRICTED GLOBAL SECURITY MAY BE TRANSFERRED TO A PERSON WHO TAKES
DELIVERY IN THE FORM OF AN INTEREST IN THE REGULATION S GLOBAL
SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE 40-DAY DISTRIBUTION
COMPLIANCE PERIOD, ONLY IF THE TRANSFEROR FIRST DELIVERS TO THE TRUSTEE A
WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE
EFFECT THAT IF SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR
904 OF REGULATION S OR RULE 144 (IF AVAILABLE) AND THAT, IF SUCH
TRANSFER OCCURS PRIOR TO THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE
PERIOD, THE INTEREST TRANSFERRED WILL BE HELD IMMEDIATELY THEREAFTER THROUGH
EUROCLEAR SYSTEM OR CLEARSTREAM BANKING, S.A.]****


 










****            To
be included on the face of each Temporary Regulation S Global Security.


 


A-3





















 


INTERNATIONAL
TRANSMISSION COMPANY

4.45% FIRST MORTGAGE BONDS, SERIES A DUE JULY 15, 2013


 


	
   

  	
  $

  	
   

  
	
  No.

  	
   

  	
  CUSIP

  	
   

  
	
   

  	
  ISIN

  	
   

  
				



 


INTERNATIONAL
TRANSMISSION COMPANY, a corporation duly organized and existing under the laws
of the State of Michigan (herein called the “Company,”
which term includes any successor under the Indenture hereinafter referred to),
for value received, hereby promises to pay to                                       
or registered assigns, the principal sum of $                             
on July 15, 2013, and to pay interest thereon from July 16, 2003, or
from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually in arrears on January 15 and July 15
in each year, commencing January 15, 2004, at the rate per annum provided
in the title hereof, until the principal hereof is paid or made available for
payment, and, subject to the terms of the Indenture hereinafter referenced, at
the rate of 4.45% per annum on any overdue principal and premium and (to the
extent that the payment of such interest shall be legally enforceable) on any
overdue installment of interest, from the dates such amounts are due until they
are paid or made available for payment, and such interest shall be payable on
demand.  The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Series A
Bond is registered at the close of business on the Regular Record Date for such
interest, which shall be the January 1 or July 1 (whether or not a
Business Day), as the case may be, immediately preceding such Interest Payment
Date.  Any such interest not so
punctually paid or duly provided for will forthwith cease to be payable to the
Holder on such Regular Record Date and may be paid to the Person in whose name
this Series A 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 as provided in the Indenture.  Interest will be computed on the basis of a
360-day year of 30-day months.


 


Payment of the principal
of (and premium, if any) and interest on the Series A Bonds will be made
at the office or agency of the Company maintained for that purpose in the City
of New York, State of New York or at the office or place of business of the Trustee
or its successor in trust under the Original Indenture hereinafter referenced,
in such coin or currency of the United States of America as at the time of
payment is legal tender for the payment of public and private debts; [if this
Security is not a Global Security, insert — provided, however, that at the
option of the Company payments of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register] [if this Security is a Global Security, insert—provided,
however, that except with respect to payments of principal, payments shall be
made by wire transfer of immediately available funds with respect to payments
in respect of Global Securities if the Holders thereof have provided wire
instructions in respect of such payments to the Company or the Paying
Agent].  Holders must surrender Series A Bonds to a Paying Agent to collect principal payments.


 


A-4





















 


Reference is hereby made
to the further provisions of the Series A Bonds 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 manually executed by or on behalf of the Trustee
under the Indenture (hereinafter referenced), this Series A Bond shall not
be entitled to any benefits under the Indenture (hereinafter referenced), or be
valid or obligatory for any purpose.


 


IN WITNESS WHEREOF,
INTERNATIONAL TRANSMISSION COMPANY has caused this Series A Bond to be duly executed.


 


 


	
  Dated:

  	
  INTERNATIONAL
  TRANSMISSION

  
	
   

  	
  COMPANY

  
	
   

  	
   

  
	
   

  	
  BY

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  



 


A-5





















 


TRUSTEE’S
CERTIFICATE OF AUTHENTICATION


 


This is one of the Series A Bonds of the series designated therein referred to in the
within-mentioned Indenture.


 


	
  Date:

  	
  BNY MIDWEST TRUST
  COMPANY,

  
	
   

  	
  as
  Trustee,

  
	
   

  	
   

  
	
   

  	
  BY:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  	
   

  



 


A-6





















 


[FORM OF
REVERSE OF SERIES A BOND]


 


This 4.45% First Mortgage
Bond, Series A is one of the duly authorized issue of bonds, notes or
other evidences of indebtedness of the Company (herein sometimes referred to as
the “Series A Bonds”), of the
series hereinafter specified, all issued or to be issued under and pursuant to
the Original Indenture dated as of July 15, 2003, as supplemented by the
First Supplemental Indenture, dated as of July 15, 2003 (as so
supplemented, the “Indenture”),
duly executed and delivered by the Company and BNY Midwest Trust Company, as
Trustee (herein called the “Trustee,”
which term includes any successor trustee under the Indenture), to which
Indenture and any other indentures supplemental thereto reference is hereby
made for a statement of the respective rights, obligations, duties and
immunities thereunder of the Trustee and any agent of the Trustee, any Paying
Agent, the Company and the Holders of the Series A Bonds and of the terms
upon which the Series A Bonds are issued and are to be authenticated and
delivered.  This Security is one of the
series designated on the face hereof, which series is initially limited in
aggregate principal amount to $185,000,000; provided that the Company may from
time to time or at any time, without the consent of the Holders of the Series A
Bonds, issue additional Securities, including additional Series A Bonds,
which additional Series A Bonds shall, if issued, increase the aggregate
principal amount of, and shall be consolidated and form a single series with,
the Series A Bonds issued on the Issue Date.  By the terms of the Indenture, additional
Securities of other separate series, which may vary as to date, aggregate
principal amount, Stated Maturity, interest rate or method of calculating the
interest rate, redemption provisions and in other respects as therein provided,
may be issued in an unlimited amount.


 


Series A Bonds may
be redeemed in accordance with the procedures set forth in the Original
Indenture on not less than 30 nor more than 60 days’ notice prior to the
Redemption Date thereof to the Holder thereof, given as provided in the
Indenture, as a whole or in part, at any time at the option of the Company, at
a Redemption Price equal to the greater of (i) 100% of the principal
amount of the Series A Bonds being redeemed and (ii) as determined by
an Independent Investment Banker, the sum of the present values of the
remaining scheduled payments of principal and interest thereon (not including
any portion of such payments of interest accrued as of the Redemption Date)
discounted to the Redemption Date on a semi-annual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Adjusted Treasury Rate, plus,
in each case, accrued and unpaid interest thereon to, but excluding, the
Redemption Date; provided, however, that installments of interest on the Series A
Bonds that are due and payable on an interest payment date falling on or prior
to the relevant Redemption Date will be payable to the Holder of the Series A
Bond registered as such at the close of business on the relevant Record Date
according to the terms and provisions of the Indenture.


 


The Series A Bonds are subject to the further redemption provisions and
procedures set forth in the Indenture.


 


The Indenture contains
provisions for defeasance of (a) the entire indebtedness of the Series A Bonds and (b) certain restrictive covenants upon
compliance by the Company with certain conditions set forth in the Indenture.


 


A-7





















 


If an Event of Default with
respect to the Series A Bonds shall occur and be
continuing, the unpaid principal of the Series A Bonds may be declared due
and payable in the manner and with the effect provided in the Indenture.


 


The Indenture permits,
with certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the
Holders of the Securities of each series to be affected under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Securities at the time
Outstanding of all series to be affected (voting as a class). The Indenture
also contains provisions permitting the Holders of specified percentages in
principal amount of the Securities of each series At
the time Outstanding, on behalf of the Holders of all Securities of such
series, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of the Securities of this series shall
be conclusive and binding upon such Holder and upon all future Holders of the
Securities of this series And of any Securities of this series issued upon
the registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon the Securities
of this series.


 


No reference herein to
the Indenture and no provision of the Series A Bonds or of the Indenture
shall alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of (and premium, if any) and interest, if
any, on the Series A Bonds 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
the Series A Bonds is registrable in the Security Register, upon surrender
of the Series A Bonds for registration of transfer at the office or agency
of the Company in any place where the principal of (and premium, if any) and
interest, if any, on the Series A Bonds are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Series A
Bonds of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.


 


The Series A Bonds are issuable only in registered form without coupons
in denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject to
certain limitations therein set forth, the Series A
Bonds are exchangeable for a like aggregate principal amount of Series A
Bonds 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 Company may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.


 


Prior to due presentment
of the Series A Bonds for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in
whose name the Series A Bonds are registered as the owner hereof for all
purposes, whether or not the Series A


 


A-8





















 


Bonds be
overdue, and neither the Company, the Trustee nor any such agent shall be
affected by notice to the contrary.


 


The Series A Bonds are not subject to any sinking fund.


 


The Series A Bonds are entitled to the benefit of the Lien under the
Indenture.


 


Each Holder, by accepting
a Series A Bond, agrees to be bound by all the
terms and provisions of the Indenture, as the same may be amended from time to
time in accordance with its terms.


 


This Series A Bond shall be governed by and
construed in accordance with the law of the State of New York, except, if the
Indenture governing this Series A Bond shall become qualified and shall
become subject to the Trust Indenture Act, to the extent that the Trust
Indenture Act shall be applicable, and except to the extent that the law of any
jurisdiction wherein any portion of the Mortgaged Property is located shall
mandatorily govern the creation of a mortgage lien on and security interest in,
or perfection, priority or enforcement of the Lien of the Indenture or exercise
of remedies with respect to, such portion of the Mortgaged Property.


 


All capitalized terms
used but not defined in this Series A Bond shall
have the meanings assigned to them in the Indenture.


 


A-9





















 


FORM OF
TRANSFER NOTICE


 


FOR VALUE RECEIVED the
undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto


 


Insert Taxpayer
Identification No.


 


	
   

  	
   

  
	
   

  
	
   

  	
   

  
	
   

  
	
  please print or
  typewrite name and address including zip code of assignee

  
	
   

  
	
   

  	
   

  
	
   

  
	
  the within
  Series A Bond and all rights thereunder, hereby irrevocably constituting
  and appointing

  
	
   

  
	
   

  	
   

  
	
   

  
	
  attorney
  to transfer said Series A Bond on the books of the Security Registrar
  with full power of substitution in the premises.

  



 


A-10





















 


[THE FOLLOWING
PROVISION TO BE INCLUDED

ON ALL SERIES A BONDS,

EXCEPT REGULATION S GLOBAL SECURITIES AND

REGULATION S DEFINITIVE SECURITIES]


 


In connection with any
transfer of this Certificate occurring prior to the date that is the earlier of
the date of an effective Registration Statement or the date two years after the
later of the original issuance of this Series A Bond or the last date on
which this Series A Bond was held by International Transmission Company or
any affiliate of International Transmission Company, the undersigned confirms
that without utilizing any general solicitation or general advertising that:


 


[Check One]


 


o
(a) the Series A Bonds are being transferred to a person whom we
reasonably believe is a “qualified institutional buyer” (as defined in Rule 144A
under the Securities Act of 1933) (a “QIB”) that purchases for its own account
or for the account of one or more QIBs to whom notice has been given that the
resale, pledge or transfer is being made in reliance on Rule 144A under
the Securities Act;


 


or


 


o
(b) the Series A Bonds are being transferred
other than in accordance with (a) above and documents are being furnished
that comply with the conditions of transfer set forth in this Series A
Bond and the Indenture.


 


If neither of the foregoing
boxes is checked, the Security Registrar shall not be obligated to register
this Series A Bond in the name of any Person other than the Holder hereof
unless and until the conditions to any such transfer of registration set forth
herein and in Section 209 of the First Supplemental Indenture shall have
been satisfied.


 


	
  Date: 

  	
  [                    
  ,      ]

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [Name of Transferor]

  
	
   

  	
   

  
	
   

  	
  NOTE: The signature
  must correspond with the name as written upon the face of the
  within-mentioned instrument in every particular, without alteration or any
  change whatsoever.

  
	
   

  
	
  Signature Guarantee: 

  	
   

  	
   

  
								



 


SIGNATURE
GUARANTEE


 


Signatures must be guaranteed by an “eligible guarantor institution”
meeting the requirements of the Security Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program (“STAMP”)
or such other “signature guarantee program” as may be determined by the
Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.


 


A-11





















 


EXHIBIT B


 


[Form of
Regulation S Transfer Certificate]


 


[Date]


 


International
Transmission Company (the “Company”)


1901 South Wagner


Ann Arbor, Michigan 48103-9715


Attention:  General Counsel


 


 


BNY Midwest Trust Company
(the “Trustee”)


2 N. LaSalle Street, Suite 1020


Chicago, Illinois  60630


Attention:  Corporate Trust Administration/Roxane
Ellwanger


 


Dear Ladies and
Gentlemen:


 


In connection with our
proposed transfer of $                      
aggregate principal amount of 4.45% First Mortgage Bonds, Series A,
due July 15, 2013 (the “Series A Bonds”) of the Company, we confirm that:


 


(vii)         the offer of the Series A Bonds was not made to a
person in the United States;


 


(vii)         either
(i) at the time the buy order was originated, the transferee was outside
the United States or we and any person acting on our behalf reasonably believed
that the transferee was outside the United States or (ii) the transaction
was executed in, on or through the facilities of a designated off-shore
securities market and neither we nor any person acting on our behalf knows that
the transaction has been pre-arranged with a buyer in the United States;


 


(vii)         no
directed selling efforts have been made in the United States in contravention
of the requirements of Rule 903(a) or Rule 904(a) of
Regulation S, as applicable; and


 


(vii)         the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.


 


In addition, if the sale
is made during the Distribution Compliance Period and the provisions of Rule 903(b)(2) or
Rule 904(b)(1) of Regulation S are applicable thereto, we confirm
that such sale has been made in accordance with the applicable provisions of Rule 903(b)(2) or
Rule 904(b)(1), as the case may be.


 


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The Company and the
Trustee are entitled to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in any
administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.  Terms used in
this certificate have the meanings set forth in Regulation S.


 


Very truly yours,


 


[Name of Transferor]


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Signature

  	
   

  



 


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EXHIBIT C


 


[Form of
Certificate to be Delivered in Connection with
Transfers to

Non-QIB Institutional Accredited Investors]


 


[Date]


 


International
Transmission Company


1901 South Wagner


Ann Arbor, Michigan  48103-9715


 


Credit Suisse First
Boston LLC


Eleven Madison Avenue


New York, NY  10010


 


Dear Sirs:


 


We are delivering this
letter in connection with an offering of $                    
of 4.45% First Mortgage Bonds, Series A due July 15, 2013 (the “Series A Bonds”)
of International Transmission Company, a Michigan corporation (the “Company”), all as described in the
Confidential Offering Circular (the “Offering
Circular”) relating to the offering.


 


We hereby confirm that:


 


(vii)         we
are an institutional “accredited investor” within the meaning of Rule 501(a)(1),
(2), (3) or (7) of Regulation D under the Securities Act of 1933, as
amended (the “Securities Act”), or
an entity in which all of the equity owners are accredited investors within the
meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities
Act (an “Institutional Accredited Investor”);


 


(vii)         (A) any
purchase of the Series A Bonds by us will be for our own account or for
the account of one or more other Institutional Accredited Investors or as
fiduciary for the account of one or more trusts, each of which is an “accredited
investor” within the meaning of Rule 501(a)(7) under the Securities
Act and for each of which we exercise sole investment discretion or (B) we
are a “bank,” within the meaning of Section 3(a)(2) of the Securities
Act, or a “savings and loan association” or other institution described in Section 3(a)(5)(A) of
the Securities Act that is acquiring the Series A Bonds as fiduciary for
the account of one or more institutions for which we exercise sole investment
discretion;


 


(vii)         we
will acquire Series A Bonds having a minimum purchase price of not less
than $100,000 for our own account or for any separate account for which we are
acting;


 


(vii)         we have such knowledge and experience in financial and
business matters that we are capable of evaluating the merits and risks of
purchasing the Series A Bonds;


 


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(vii)         we
are not acquiring the Series A Bonds with a view to distribution thereof
or with any present intention of offering or selling any of the Series A
Bonds, except inside the United States in accordance with Rule 144A under
the Securities Act or outside the United States under Regulation S under the Securities
Act, as provided below; provided that
the disposition of our property and the property of any accounts for which we
are acting as fiduciary shall remain at all times within our control;


 


(vii)         we
have received a copy of the Offering Circular relating to the offering of the Series A
Bonds and acknowledge that we have had access to financial and other
information, and have been afforded the opportunity to ask questions of
representatives of the Company and receive answers thereto, as we deem necessary
in connection with our decision to purchase the Series A Bonds; and


 


(vii)         we
understand that any subsequent transfer of the Series A Bonds is subject
to certain restrictions and conditions set forth in the Indenture, dated as of July 15,
2003, among the Company, BNY Midwest Trust Company (the “Trustee”) as supplemented by the First
Supplemental Indenture, dated as of July 15, 2003 among the Company and
the Trustee (together, the “Indenture”),
relating to the Series A Bonds, and we agree to be bound by, and not to
resell, pledge or otherwise transfer the purchased Series A Bonds except
in compliance with, such restrictions and conditions and the Securities Act.


 


We understand
that the Series A Bonds are being offered in a transaction not involving
any public offering within the United States within the meaning of the
Securities Act and that the Series A Bonds have not been and will not be
registered under the Securities Act, and we agree, on our own behalf and on
behalf of each account for which we acquire any Series A
Bonds, that if in the future we decide to resell, pledge or otherwise transfer
the Series A Bonds within two years after the later of the original
issuance of such Series A Bonds and the last date on which such Series A
Bonds are owned by the Company or any affiliate of the Company, the Series A
Bonds may be offered, resold, pledged or otherwise transferred only (i) in
the United States to a person who we reasonably believe is a “qualified
institutional buyer” (as defined in Rule 144A under the Securities Act) in
a transaction meeting the requirements of Rule 144A, (ii) outside the
United States in a transaction in accordance with Rule 904 under the
Securities Act, (iii) under an exemption from registration under the
Securities Act provided by Rule 144 thereunder (if available) or (iv) under
an effective registration statement under the Securities Act, in each of cases (i) through
(iv), subject to any applicable securities laws of any State of the United
States or any other applicable jurisdiction. 
We understand that the Security Registrar and transfer agent for the Series A Bonds, will not be required to accept for registration of
transfer any Series A Bonds acquired by us, except upon presentation of
evidence satisfactory to the Company and the
transfer agent that the foregoing restrictions on transfer have been complied
with.  We further understand that any Series A Bonds acquired by us will be in the form of definitive
physical certificates and that the certificates will bear a legend reflecting
the substance of this paragraph.


 


We acknowledge that you,
the Company and others will rely upon our
confirmations, acknowledgements and agreements set forth herein, and we agree
to notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.


 


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THIS
LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.


 


 


	
  Date:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (Name of Purchaser)

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
  Address:

  	
   

  
							



 


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EXHIBIT D


 


REAL
PROPERTY


 


State of Michigan


 


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