Exhibit 4.2


 


Company Order


 


November 20, 2007


 


The Bank of New York
Trust Company, N.A.


Two North LaSalle Street,
Suite 1020


Chicago, IL  60602


 


Ladies and Gentlemen:


 


Application is hereby
made to The Bank of New York Trust Company, N.A., a national banking
association, as trustee (the “Trustee”), under the Indenture dated as of June
1, 2006 (the “Indenture”), between Illinois Power Company, an Illinois
corporation (the “Company”), and the Trustee for the authentication and
delivery of $250,000,000 aggregate principal amount of the Company’s 6.125%
Senior Secured Notes due 2017 (the “Notes”), pursuant to the provisions of
Article II of the Indenture. Additional Notes without limitation as to amount,
and without the consent of the holders of the then Outstanding Notes, may also
be authenticated and delivered in the manner provided in Section 2.05 of the
Indenture. All capitalized terms not defined herein that are defined in the
Indenture shall have the same meaning as used in the Indenture.


 


The Notes will be
initially issued pursuant to Section 4(2) of the Securities Act of 1933, as
amended (the “Securities Act”), in the form of Global Notes registered in the
name of Cede & Co. (as nominee for The Depository Trust Company (“DTC”),
New York, New York, which will act as the Depositary for the Global Notes). Pursuant
to Section 2.05(c) of the Indenture, the Notes will have the terms set forth in
the form of Global Note attached hereto as Exhibit A and in the form of
definitive Note attached hereto as Exhibit B (which terms are incorporated by
reference in this Company Order). The Global Notes shall bear the depository
legend in substantially the form set forth in Exhibit A attached hereto. The
Notes will be issued only in denominations of $1,000 and in integral multiples
of $1,000 in excess thereof.


 


Initially, beneficial
interests in the Notes offered and sold to qualified institutional buyers (as
defined in Rule 144A under the Securities Act) (“QIBs”) in reliance upon Rule
144A under the Securities Act will be represented by one or more separate
Global Notes (each, a “Rule 144A Global Certificate”) registered in the name of
Cede & Co., as registered owner and as nominee for DTC and shall include
the non-registration and registration rights legends set forth in Exhibit A
attached hereto. Initially beneficial interests in the Notes offered and sold
to purchasers pursuant to Regulation S under the Securities Act will be
evidenced by one or more separate temporary Global Notes (each, a “Temporary
Regulation S Global Certificate”) and will be registered in the name of Cede
& Co., as registered owner and as nominee for DTC for the accounts of The
Euroclear System (“Euroclear”) or Clearstream Banking, Luxembourg, société
anonyme (“Clearstream”) and shall include the Regulation S and
registration rights legends set forth in Exhibit A attached hereto. Notes
offered and sold to institutional “accredited investors” (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) who are not QIBs and who
are not purchasers pursuant to Regulation S under the Securities Act will be in
definitive form in the form attached hereto as Exhibit B and shall include
the non-registration and registration 


 

















 


rights legends set forth therein. The Trustee and the Company will have
no responsibility or liability for any aspect of transfers of beneficial
interests in the Notes (which transfers will be conducted pursuant to the
customary procedures of DTC), any records of DTC of beneficial interests or any
transactions between DTC and its participants or between any such participants
and any other beneficial owners or for monitoring, supervising or reviewing of
any thereof.


 


Transfers of beneficial
interests in the Rule 144A Global Certificate will be subject to the
restrictions on transfer contained in the non-registration legend set forth in
Exhibit A hereto. Prior to the expiration of the period of
40 consecutive days beginning on and including the later of (x) the day on
which the offering of the Notes commences and (y) the original issue date of
the Notes (the “Distribution Compliance Period”), transfers of beneficial
interests in the Temporary Regulation S Global Certificate will be subject
to the restrictions on transfer contained in the Regulation S legend set
forth in Exhibit A hereto. At any time after the expiration of the
Distribution Compliance Period, upon receipt by the Trustee and the Company of
a certificate from Euroclear or Clearstream certifying that it has received
certification of non-U.S. beneficial ownership of a Temporary Regulation S
Global Certificate (or portion thereof) with respect to any Notes to be
exchanged, one or more separate permanent Global Notes (each, a “Permanent
Regulation S Global Certificate” and, together with each Temporary Regulation S
Global Certificate, each, a “Regulation S Global Certificate”) shall be duly
executed by the Company and authenticated by the Trustee as provided in the
Indenture, shall be registered in the name of Cede & Co., as registered
owner and as nominee for DTC, and shall include the registration rights legend
set forth in Exhibit A hereto and shall be deposited with the Trustee, as
custodian for DTC. The Trustee, as custodian for DTC, shall reflect by
endorsement thereon a decrease in the principal amount of the Temporary Regulation
S Global Certificate in an amount equal to the principal amount of such
Temporary Regulation S Global Certificate exchanged. Prior to the expiration of
the Distribution Compliance Period, beneficial interests in any Temporary
Regulation S Global Certificate may only be held through Euroclear or
Clearstream. After the expiration of the Distribution Compliance Period,
transfers of beneficial interests in the Permanent Regulation S Global
Certificate will not be subject to any restrictions.


 


In connection with any
transfer of Notes, the Trustee and the Company shall be under no duty to
inquire into, may conclusively presume the correctness of, and shall be fully
protected in relying upon the certificates and other information (set forth in
the form of definitive Note attached hereto as Exhibit B, for use in connection
with the transfer of the Notes in definitive form, or set forth in Exhibit A-1
attached hereto, for use in connection with the transfer of beneficial
interests between a Rule 144A Global Certificate and a Regulation S Global
Certificate or to a Note in definitive form, or otherwise) received from the
Holders and any transferees of any Notes regarding the validity, legality and
due authorization of any such transfer, the eligibility of the transferee to
receive such Note and any other facts and circumstances related to such
transfer. Transfers of beneficial interests between a Rule 144A Global
Certificate and a Regulation S Global Certificate, and other transfers relating
to beneficial interests in the Notes in global form, shall be reflected by
endorsements of the Trustee, as custodian for DTC, on the schedule attached to
such certificate.


 


The Company has entered
into a Registration Rights Agreement dated as of November 20, 2007 (the “Registration
Rights Agreement”) with the initial purchasers of the Notes pursuant 


 


2

















 


to which the Notes that are issued and sold without registration (the “Private
Notes”) under the Securities Act may be exchanged for Notes that will be
registered under the Securities Act and that will otherwise have substantially
the same terms as the Private Notes (the “Exchange Notes”), except that such
Exchange Notes will be issued in the form of Global Note attached hereto as
Exhibit A and will bear all customary legends (except for the non-registration,
Regulation S and registration rights legends) or, in lieu of such exchange, the
Company has agreed to file a shelf registration statement for the resale of the
Notes (in which case any Notes so resold will be issued in the form of Global
Note attached hereto as Exhibit A and bear all customary legends (except
for the non-registration, Regulation S and registration rights legends)). The
Private Notes will be exchanged for Exchange Notes only pursuant to an
effective registration statement under the Securities Act and otherwise in
accordance with the Registration Rights Agreement and the Indenture. The
Private Notes and the Exchange Notes will constitute a single series of notes
under the Indenture. Exchange Notes shall be authenticated and delivered by the
Trustee at one time or from time to time upon the receipt by the Trustee of a
Company Order in principal amounts equal to the principal amounts of the
Private Notes surrendered in exchange therefor. In addition, upon the receipt
of such Company Order, the Trustee will take such actions as to effectuate the
exchange of any Private Notes for Exchange Notes in accordance with the
Registration Rights Agreement and the Indenture.


 


In connection with this
Company Order, there are delivered to you herewith the following:


 


1.               Certified copies of
the resolutions adopted by the Board of Directors of the Company authorizing
this Company Order and the issuance and sale of the Notes by the Company
pursuant to Section 2.05(c)(1) of the Indenture;


 


2.               Opinions of Counsel
addressed to you or in which it is stated that you may rely pursuant to Section
2.05(c)(2) of the Indenture;


 


3.               Expert’s
certificate pursuant to Section 2.05(c)(3) of the Indenture;


 


4.               Officers’
Certificate pursuant to Section 2.05(c)(4) of the Indenture;


 


5.               Two Global Notes
representing the Notes executed on behalf of the Company in accordance with the
terms of Section 2.05(a) of the Indenture, specifying the terms of the Notes
(which terms are incorporated by reference herein); and


 


6.               Pursuant to Section
2.05(c)(3) of the Indenture, the Company’s Mortgage Bonds designated “Mortgage
Bonds, Senior Notes Series BB” (the “Mortgage Bonds”) in the principal
amount of $250,000,000 relating to the Notes, fully registered in the name of
the Trustee in trust for the benefit of the Holders from time to time of such
Notes.


 


You are hereby instructed
to authenticate the Global Notes representing the Notes and hold them as DTC’s
custodian. The Global Notes representing the Notes are to be held for delivery
through the facilities of DTC to the initial purchasers thereof against payment
therefor at the closing in respect of the sale thereof, such closing to be held
at 10:00 a.m., New York time, 


 


3

















 


November 20, 2007, at the offices of Pillsbury Winthrop Shaw Pittman
LLP, 1540 Broadway, New York, New York 10036.


 


4

















 


Please acknowledge
receipt of the Global Notes representing the Notes, the instructions referred
to above and the supporting documentation pursuant to the Indenture referred to
above (including the Mortgage Bonds in trust for the benefit of the Holders).


 


	
   

  	
  Very truly yours,

  
	
   

  	
   

  	
   

  
	
   

  	
  Illinois Power Company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
           /s/
  Jerre E. Birdsong

  	
   

  
	
   

  	
   

  	
  Name:   Jerre
  E. Birdsong

  	
   

  
	
   

  	
   

  	
  Title:
      Vice
  President and Treasurer

  	
   

  
					



 


5

















 


Receipt from the Company
of the Global Notes representing the Notes, certain instructions related
thereto and the supporting documentation pursuant to the Indenture (including
the Mortgage Bonds in trust for the benefit of the Holders) in connection with
the authentication and delivery of the Notes is hereby acknowledged.


 


	
   

  	
  The Bank of New York
  Trust Company, N.A.,

  
	
   

  	
  as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
           /s/
  M. Callahan

  
	
   

  	
   

  	
  Name: M. Callahan

  
	
   

  	
   

  	
  Title: Vice President

  



 


6
















 


EXHIBIT A


FORM OF GLOBAL NOTE


 


[depository legend]


 


THIS SECURITY IS A GLOBAL
NOTE REGISTERED IN THE NAME OF THE DEPOSITARY (REFERRED TO HEREIN) OR A NOMINEE
THEREOF AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE FOR THE INDIVIDUAL NOTES
REPRESENTED HEREBY AS PROVIDED IN THE INDENTURE REFERRED TO BELOW, THIS
SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE
TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS
THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK), TO THE TRUSTEE FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS 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.


 


[non-registration legend to be included on Private
Notes]


 


THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THE HOLDER HEREOF,
BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS
SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED PRIOR TO THE DATE
WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE DATE THEREOF AND
THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE THEREOF WAS THE OWNER OF
THIS SECURITY OR THE EXPIRATION OF SUCH SHORTER PERIOD AS MAY BE PRESCRIBED BY
RULE 144(k), OR ANY SUCCESSOR PROVISION THEREOF, UNDER THE SECURITIES ACT (THE “RESALE
RESTRICTION TERMINATION DATE”) OTHER THAN (1) TO THE COMPANY, (2) IN A
TRANSACTION ENTITLED TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT, (3) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE
BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ATTACHED TO THIS
SECURITY), (4) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR 904 OF


 


A-1

















 


REGULATION
S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR
ON THE CERTIFICATE OF TRANSFER ATTACHED TO THIS SECURITY), (5) TO AN
INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE
TRANSFEROR ON THE CERTIFICATE OF TRANSFER ATTACHED TO THIS SECURITY) THAT IS
ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND A
CERTIFICATE IN THE FORM ATTACHED TO THIS SECURITY IS DELIVERED BY THE
TRANSFEREE TO THE COMPANY AND THE TRUSTEE OR (6) IN ACCORDANCE WITH ANOTHER
APPLICABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OR PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE FOREGOING
RESTRICTIONS ON RESALE WILL NOT APPLY SUBSEQUENT TO THE RESALE RESTRICTION
TERMINATION DATE. THE HOLDER OF THIS SECURITY ACKNOWLEDGES THAT THE COMPANY
RESERVES THE RIGHT PRIOR TO ANY OFFER, SALE OR OTHER TRANSFER (1) PURSUANT TO
CLAUSE (2) PRIOR TO THE RESALE RESTRICTION TERMINATION DATE TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS OR OTHER INFORMATION
SATISFACTORY TO THE COMPANY AND (2) IN EACH OF THE FOREGOING CASES, TO REQUIRE
THAT A CERTIFICATE AS TO COMPLIANCE WITH CERTAIN CONDITIONS TO TRANSFER IS
COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE COMPANY.


 


[Regulation S legend
to be included on Private Notes]


 


THIS SECURITY IS REPRESENTED BY A TEMPORARY REGULATION
S GLOBAL CERTIFICATE WITHIN THE MEANING OF THE COMPANY ORDER ESTABLISHING THE
TERMS OF THIS SECURITY. BY ITS ACQUISITION HEREOF, EACH HOLDER OF THIS
SECURITY, AND EACH PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN SUCH SECURITY,
AGREES THAT PRIOR TO THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD (AS
DEFINED IN THE COMPANY ORDER ESTABLISHING THE TERMS OF THIS SECURITY),
BENEFICIAL INTERESTS IN THIS SECURITY MAY ONLY BE OFFERED, RESOLD OR OTHERWISE
TRANSFERRED (A) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OF 1933 OR (B) OUTSIDE
THE UNITED STATES IN COMPLIANCE WITH RULE 903 OR 904 UNDER THE
SECURITIES ACT OF 1933 AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION.


 


[registration rights
legend to be included on Private Notes]


 


BY ITS ACCEPTANCE OF THE SECURITIES EVIDENCED HEREBY
OR A BENEFICIAL INTEREST IN SUCH SECURITIES, THE HOLDER OF, AND ANY PERSON THAT
ACQUIRES A BENEFICIAL INTEREST IN, SUCH SECURITIES AGREES TO BE


 


A-2

















 


BOUND
BY THE PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT (THE “REGISTRATION
RIGHTS AGREEMENT”) DATED AS OF NOVEMBER 20, 2007 AND RELATING TO THE
REGISTRATION UNDER THE SECURITIES ACT OF SECURITIES EXCHANGEABLE FOR THE
SECURITIES EVIDENCED HEREBY AND REGISTRATION OF THE SECURITIES EVIDENCED
HEREBY.


 


Illinois Commerce Commission ID No.: 6446


 


ILLINOIS POWER COMPANY

6.125% SENIOR SECURED NOTE DUE 2017


 


	
  CUSIP:
  [452092CR8] [U4504NCC1]

  	
  NUMBER:
  1

  
	
  ISIN:
  [US452092CR82] [USU4504NCC12]

  	
   

  
	
   

  	
   

  
	
  ORIGINAL
  ISSUE DATE: November 20, 2007

  	
  PRINCIPAL
  AMOUNT: Listed on Schedule

  
	
   

  	
   

  	
  I
  hereto

  
	
   

  	
   

  	
   

  
	
  INTEREST
  RATE: 6.125%

  	
  MATURITY
  DATE: November 15, 2017

  



 


ILLINOIS POWER COMPANY, a
corporation of the State of Illinois (the “COMPANY”), for value received hereby
promises to pay to CEDE & CO. or registered assigns, the principal amount
specified above on the Maturity Date set forth above, and to pay interest
thereon from and including the Original Issue Date specified above or from and
including the most recent Interest Payment Date to which interest has been paid
or duly provided for, semi-annually in arrears on May 15 and November 15 in
each year, commencing May 15, 2008, and on the Maturity Date, at the per annum
interest rate set forth above until the principal hereof is paid or made
available for payment. [If the Company does not comply with certain of its
obligations under the Registration Rights Agreement, this bond shall, in
accordance with Section 2(e) of the Registration Rights Agreement, bear
additional interest (“Additional Interest”) in addition to the interest
provided for in the immediately preceding sentence. For purposes of this Note,
the term “interest” shall be deemed to include interest provided for in the
second immediately preceding sentence and Additional Interest, if any.]* No interest shall accrue on the Maturity Date, so long as the
principal amount of this Note is paid in full on the Maturity Date. The
interest so payable and punctually paid or duly provided for on any such
Interest Payment Date will (except for interest payable on the Maturity Date
set forth above or, if applicable, upon redemption or acceleration), as
provided in the Indenture (as defined below), be paid to the Person in whose name
this Note is registered at the close of business on the Regular Record Date for
such interest, which shall be May 1 or November 1, as the case may be, next
preceding such Interest Payment Date; provided, that the first Interest Payment
Date for any part of this Note, the Original Issue Date of which is after a
Regular Record Date but prior to the applicable Interest Payment Date, shall be
the Interest Payment Date following the next succeeding Regular Record Date;
and provided, that interest payable on the Maturity Date set forth above or, if
applicable, upon redemption or acceleration, shall be payable to the Person to
whom principal shall be payable. Except as otherwise provided in the Indenture,
any such interest not so


 






*  Include
bracketed language only in a Private Note.


 


A-3

















 


punctually paid or
duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and shall be paid to the Person in whose name this Note is
registered at the close of business on a Special Record Date for the payment of
such defaulted interest to be fixed by the Trustee, notice whereof shall be
given to Noteholders not more than fifteen days nor fewer than ten days prior
to such Special Record Date. Payment of the principal of and interest and
premium on this Note shall be payable pursuant to Section 2.12(a) of the
Indenture.


 


This Note is a Global
Note in respect of a duly authorized issue of 6.125% Senior Secured Notes due
2017 (the “NOTES OF THIS SERIES”, which term includes any Global Notes
representing such Notes) of the Company issued and to be issued under an
Indenture dated as of June 1, 2006 between the Company and The Bank of New
York Trust Company, N.A., as trustee (herein called the “TRUSTEE”, which term
includes any successor Trustee under the Indenture) and indentures supplemental
thereto (collectively, the “INDENTURE”). Under the Indenture, one or more
series of notes may be issued and, as used herein, the term “Notes” refers to
the Notes of this Series. Reference is hereby made to the Indenture for a more
complete statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Noteholders and of
the terms upon which the Notes are and are to be authenticated and delivered.
This Note has been issued in respect of the series designated on the first page
hereof, issued in the initial aggregate principal amount of $250,000,000.


 


The Notes will be secured
by mortgage bonds (the “SENIOR NOTE MORTGAGE BONDS”) delivered by the Company
to the Trustee for the benefit of the Holders of the Notes, issued under the
General Mortgage Indenture and Deed of Trust, dated as of November 1, 1992
between the Company and The Bank of New York Trust Company, N.A. (formerly BNY
Midwest Trust Company), as successor trustee (the “MORTGAGE TRUSTEE”), as
supplemented and modified (collectively, the “MORTGAGE”). Reference is made to
the Mortgage and the Indenture for a description of the rights of the Trustee
as holder of the Senior Note Mortgage Bonds, the property mortgaged and
pledged, the nature and extent of the security and the rights of the holders of
mortgage bonds, under the Mortgage and the rights of the Company and of the
Mortgage Trustee in respect thereof, the duties and immunities of the Mortgage
Trustee and the terms and conditions upon which the Senior Note Mortgage Bonds
are secured and the circumstances under which additional mortgage bonds may be
issued.


 


So long as any of the
Notes of this Series are outstanding, the Company will not optionally redeem,
purchase or otherwise retire in full its outstanding Mortgage Bonds not subject
to the release provisions of the Indenture, and, therefore, the Release Date
will not occur.


 


Each Note of this Series
shall be dated and issued as of the date of its authentication by the Trustee
and shall bear an Original Issue Date. Each Note of this Series issued upon
transfer, exchange or substitution of such Note shall bear the Original Issue
Date of such transferred, exchanged or substituted Note, as the case may be.


 


Interest on this Note
will accrue from and including the Original Issue Date specified above to, but
excluding, May 15, 2008, and thereafter, from and including each Interest
Payment Date to, but excluding, the next succeeding Interest Payment Date or
the Maturity Date, as the case may be.


 


A-4

















 


Interest payments for
this Note shall be computed on the basis of a 360-day year consisting of twelve
30-day months. If any Interest Payment Date falls on a day that is not a
Business Day, the Interest Payment Date will be the next succeeding Business
Day (and without any interest or other payment in respect of any such delay). If
the Maturity Date of this Note or any redemption date falls on a day that is
not a Business Day, the payment of principal, premium, if any, and interest
will be made on the next succeeding Business Day, and no interest on such
payment shall accrue for the period from and after the Maturity Date or such
redemption date.


 


All or a portion of the
Notes of this Series may be redeemed at the option of the Company at any time
or from time to time. The redemption price for the Notes of this Series to be
redeemed on any redemption date will be equal to the greater of the following
amounts: (a) 100% of the principal amount of the Notes of this Series
being redeemed on the redemption date; or (b) the sum of the present values of
the remaining scheduled payments of principal and interest on the Notes of this
Series being redeemed on that redemption date (not including any portion of any
payments of interest accrued to the redemption date) discounted to the
redemption date on a semiannual basis at the Adjusted Treasury Rate (as defined
below) plus 30 basis points, as determined by the Reference Treasury Dealer (as
defined below); plus, in each case, accrued and unpaid interest thereon to the
redemption date. Notwithstanding the foregoing, installments of interest on
Notes of this Series that are due and payable on Interest Payment Dates falling
on or prior to a redemption date will be payable on the Interest Payment Date
to the Holder of this Note as of the close of business on the relevant Regular
Record Date. The redemption price will be calculated on the basis of a 360-day
year consisting of twelve 30-day months.


 


The Company shall mail
notice of any redemption at least 30 days but not more than 60 days before the
redemption date to each Holder of the Notes of this Series to be redeemed.
Unless the Company defaults in payment of the redemption price, on and after
the redemption date, interest will cease to accrue on the Notes of this Series
or portions thereof called for redemption.


 


“ADJUSTED TREASURY RATE”
means, with respect to any redemption date, the rate per annum equal to the
semiannual equivalent yield to maturity of the Comparable Treasury Issue,
assuming 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.


 


“COMPARABLE TREASURY
ISSUE” means the United States Treasury security selected by the Reference
Treasury Dealer as having a maturity comparable to the remaining term of the
Notes of this Series 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 of comparable maturity to the remaining
term of such Notes of this Series.


 


“COMPARABLE TREASURY
PRICE” means, with respect to any redemption date, (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 four such Reference Treasury Dealer Quotations, the
average of all such quotations, or (C) if only one Reference Treasury Dealer
Quotation is received, such quotation.


 


A-5

















 


“REFERENCE TREASURY
DEALER” means (A) Barclays Capital Inc., BNP Paribas Securities Corp., J.P.
Morgan Securities Inc. or Lazard Capital Markets LLC or their respective
affiliates which are primary U.S. Government securities dealers in New York
City (each, a “Primary Treasury Dealer”), and their respective successors;
provided, however, that if any of the foregoing shall cease to be a Primary
Treasury Dealer, the Company shall substitute therefor another Primary Treasury
Dealer; and (B) any other Primary Treasury Dealer(s) selected by the Trustee
after consultation with the Company.


 


“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. (New York City time) on the third
Business Day preceding such redemption date.


 


The Company, at its
option, and subject to the terms and conditions provided in the Indenture, will
be discharged from any and all obligations in respect of the Notes of this
Series (except for certain obligations including obligations to register the
transfer or exchange of Notes of this Series, replace stolen, lost or mutilated
Notes of this Series, maintain paying agencies and hold monies for payment in
trust, all as set forth in the Indenture) if the Company deposits with the
Trustee money, U.S. Government Obligations which through the payment of interest
thereon and principal thereof in accordance with their terms will provide
money, or a combination of money and U.S. Government Obligations, in any event
in an amount sufficient, without reinvestment, to pay all the principal of and
any premium and interest on the Notes of this Series on the dates such payments
are due in accordance with the terms of the Notes of this Series.


 


If an Event of Default
shall occur and be continuing with respect to the Notes, the principal of and
interest on the Notes may be declared due and payable in the manner and with
the effect provided in the Indenture and, upon such declaration, the Trustee
shall demand the redemption of the Senior Note Mortgage Bonds to the extent
provided in the Indenture.


 


The Indenture permits, with
certain exceptions as therein provided, the amendment thereof and the
modifications of the rights and obligations of the Company and the rights of
the Noteholders 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 outstanding Notes. Any such consent or waiver by the Holder of this Note
shall be conclusive and binding upon such Holder and upon all future Holders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange therefor or in lieu thereof whether or not notation of such consent or
waiver is made upon this Note.


 


As set forth in and
subject to the provisions of the Indenture, no Holder of any Notes will have
any right to institute any proceeding with respect to the Indenture or for any
remedy thereunder unless such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default with respect to such Notes, the
Holders of a majority in aggregate principal amount of the outstanding Notes
affected by such Event of Default shall have made written request and offered
reasonable indemnity to the Trustee to institute such proceeding as Trustee and
the Trustee shall have failed to institute such proceeding within 60 days;
provided, 


 


A-6

















 


however, that such
limitations do not apply to a suit instituted by the Holder hereof for the
enforcement of payment of the principal of and any premium or interest on this
Note on or after the respective due dates expressed herein.


 


No reference herein to
the Indenture and to provisions of this Note or of the Indenture shall alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of and any premium and interest on this Note at the times,
places and rates and the coin or currency prescribed in the Indenture.


 


As provided in the
Indenture and subject to certain limitations therein set forth, this Note may
be transferred only as permitted by the legend hereto and the provisions of the
Indenture.


 


The Indenture and the
Notes shall be governed by, and construed in accordance with, the laws of the
State of New York without regard to conflicts of law principles thereof.


 


Unless the certificate of
authentication hereon has been executed by the Trustee, directly or through an
Authenticating Agent by manual signature of an authorized officer, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.


 


All terms used in this
Note that are defined in the Indenture shall have the meanings assigned to them
in the Indenture unless otherwise indicated herein.


 


A-7

















 


IN WITNESS WHEREOF, the
Company has caused this instrument to be duly executed.


 


	
   

  	
  ILLINOIS
  POWER COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Attest:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						



 


TRUSTEE’S
CERTIFICATE

OF AUTHENTICATION


 


Dated:
November 20, 2007


 


This
Note is one of the Notes of the series herein designated, described or provided
for in the within-mentioned  Indenture.


 


THE BANK OF NEW YORK
TRUST COMPANY, N.A., As Trustee


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  



 


A-8

















 


SCHEDULE I


 


[144A]*[REGULATION S]* GLOBAL SECURITY


 


The
initial principal amount of Notes evidenced by this Global Note is $                  .


 


CHANGES
TO PRINCIPAL AMOUNT OF NOTES EVIDENCED BY GLOBAL NOTE


 


	
  Date

  	
   

  	
  Principal Amount of

  Notes by which this

  Global Note is to be

  Reduced or Increased,

  and Reason for

  Reduction or Increase

  	
   

  	
  Remaining Principal

  Amount of Notes

  Represented by this

  Global Note

  	
   

  	
  Notation Made by

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 






*  Include
bracketed language only in a Private Note.


 


A-9

















 


EXHIBIT A-1


 


CERTIFICATE OF TRANSFER*


 


ILLINOIS POWER COMPANY


 


6.125% Senior Secured Notes due 2017


 


FOR VALUE RECEIVED, the undersigned sells, assigns and transfers unto


 


PLEASE
INSERT SOCIAL SECURITY OR OTHER


IDENTIFYING
NUMBER OF ASSIGNEE


 


Name
and address of assignee must be printed or typewritten.


 


$


 


principal
amount of beneficial interest in the referenced Security of the Company and
does hereby irrevocably constitute and appoint


 


to
transfer the said beneficial interest in such Security, with full power of
substitution in the premises.


 


The
undersigned certifies that said beneficial interest in said Security is being
resold, pledged or otherwise transferred as follows:


(check
one)


 


•                              to the Company;


 


•                              to a Person whom the undersigned reasonably
believes is a qualified institutional buyer within the meaning of Rule 144A
under the Securities Act of 1933, as amended (the “Securities Act”), purchasing
for its own account or for the account of a qualified institutional buyer to
whom notice is given that the resale, pledge or other transfer is being made in
reliance on Rule 144A;


 


•                              in an offshore transaction in accordance with
Rule 903 or 904 of Regulation S under the Securities Act;


 


•                              to an institution that is an “accredited investor”
as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is
acquiring this Security for investment purposes and not for distribution
(attach a copy of an Institutional Accredited Investor Certificate in the form
annexed signed by an authorized officer of the transferee);


 


•                              as otherwise permitted by the non-registration
legend appearing on this Security; or


 


•                              as otherwise agreed by the Company, confirmed in
writing to the Trustee, as follows: [describe]


 


	
  Dated:

  	
   

  	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NOTICE:
  The signature to this assignment must correspond with the name as written
  upon the face of the within instrument in every particular without alteration
  or enlargement, or any change whatever.

  



 






*  Include this form of
Certificate of Transfer only in a Private Note.


 


A-10

















 


SIGNATURE GUARANTEE


 


Signatures
must be guaranteed by an “eligible guarantor institution” meeting the
requirement of the 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 registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.


 


A-11

















 


[FORM OF INSTITUTIONAL ACCREDITED INVESTOR CERTIFICATE]*


 


[Transferor
Name and Address]


 


Ladies
and Gentlemen:


 


In
connection with our proposed purchase of 6.125% Senior Secured Notes due 2017
(the “Notes”) issued by Illinois Power Company d/b/a AmerenIP (the “Issuer”),
we confirm that:


 


1.             We
have received a copy of the Offering Memorandum (the “Offering Memorandum”)
relating to the Notes and such other information as we deem necessary in order
to make our investment decision. We acknowledge that we have read and agree to
the matters stated under the caption NOTICE TO INVESTORS in such Offering
Memorandum.


 


2.             We
understand that any subsequent transfer of the Notes is subject to certain
restrictions and conditions set forth in the indenture relating to the Notes
(the “Indenture”) and as set forth under NOTICE TO INVESTORS in the Offering
Memorandum and the undersigned agrees to be bound by, and not to resell, pledge
or otherwise transfer the Notes except in compliance with such restrictions and
conditions and the Securities Act of 1933, as amended (the “Securities Act”).


 


3.             We
understand that the offer and sale of the Notes have not been registered under
the Securities Act, and that the Notes may not be offered or sold except as
permitted in the following sentence. We agree, on our own behalf and on behalf
of any accounts for which we are acting as hereinafter stated, that if we sell
any Notes, we will do so only (A) to the Issuer, (B) so long as the Notes are
eligible for resale pursuant to Rule 144A under the Securities Act (“Rule 144A”),
to a person whom we reasonably believe is a “qualified institutional buyer”
within the meaning of Rule 144A that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or other transfer is being made in reliance on Rule 144A, (C) to
an institutional “accredited investor” (as defined below) that, prior to such
transfer, furnishes to the Trustee (as defined in the Indenture) a signed
letter containing certain representations and agreements relating to the
restrictions on transfer of the Notes (substantially in the form of this
letter), (D) in an offshore transaction in accordance with Rule 904 of
Regulation S under the Securities Act, (E) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act (if available), or
(F) in accordance with another applicable exemption from the registration
requirements of, or in a transaction not subject to, the Securities Act or
pursuant to an effective registration statement under the Securities Act, and
we further agree to provide to any person purchasing any of the Notes from us a
notice advising such purchaser that resales of the Notes are restricted as
stated herein.


 






*  Include this form only in a
Private Note.


 


A-12

















 


4.             We
understand that, on any proposed resale of any Notes, we will be required to
furnish to the Trustee and the Issuer such certification and other information
as the Trustee and the Issuer may reasonably require to confirm that the
proposed sale complies with the foregoing restrictions. We further understand
that the Notes purchased by us will bear a legend to the foregoing effect.


 


5.             We
are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act) and have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of our investment in the Notes, and we and any accounts for which we are
acting are each able to bear the economic risk of our or its investment.


 


6.             We
are acquiring the Notes purchased by us for our own account or for one or more
accounts (each of which is an institutional “accredited investor”) as to each
of which we exercise sole investment discretion in each case for investment and
not with a view to, or for offer or sale in connection with, any distribution
in violation of the Securities Act.


 


You,
the Issuer 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 proceeding or official inquiry
with respect to the matters covered hereby.


 


	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


A-13
















 


EXHIBIT B


FORM OF DEFINITIVE NOTE


 


[non-registration legend to be included on Private Notes]


 


THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). THE HOLDER HEREOF,
BY PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS
SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED PRIOR TO THE DATE
WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE DATE THEREOF AND
THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE THEREOF WAS THE OWNER OF
THIS SECURITY OR THE EXPIRATION OF SUCH SHORTER PERIOD AS MAY BE PRESCRIBED BY
RULE 144(k), OR ANY SUCCESSOR PROVISION THEREOF, UNDER THE SECURITIES ACT (THE “RESALE
RESTRICTION TERMINATION DATE”) OTHER THAN (1) TO THE COMPANY, (2) IN A TRANSACTION
ENTITLED TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT, (3) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (4) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR 904 OF
REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE
TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (5)
TO AN INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION, AND A CERTIFICATE IN THE FORM ATTACHED TO THIS SECURITY IS
DELIVERED BY THE TRANSFEREE TO THE COMPANY AND THE TRUSTEE OR (6) IN ACCORDANCE
WITH ANOTHER APPLICABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. AN
INSTITUTIONAL ACCREDITED INVESTOR HOLDING THIS SECURITY AGREES IT WILL FURNISH
TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES AND OTHER INFORMATION AS THEY
MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY
COMPLIES WITH THE FOREGOING RESTRICTIONS. THE FOREGOING RESTRICTIONS ON RESALE
WILL NOT APPLY SUBSEQUENT TO THE RESALE RESTRICTION TERMINATION DATE. THE
HOLDER OF THIS SECURITY ACKNOWLEDGES THAT THE COMPANY RESERVES THE RIGHT 


 


B-1

















 


PRIOR
TO ANY OFFER, SALE OR OTHER TRANSFER (1) PURSUANT TO CLAUSE (2) PRIOR TO THE
RESALE RESTRICTION TERMINATION DATE TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATIONS OR OTHER INFORMATION SATISFACTORY TO THE COMPANY AND
(2) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE AS TO
COMPLIANCE WITH CERTAIN CONDITIONS TO TRANSFER IS COMPLETED AND DELIVERED BY
THE TRANSFEROR TO THE COMPANY.


 


[Regulation S legend
to be included on Private Notes]


 


BY ITS ACQUISITION HEREOF, EACH HOLDER OF THIS
SECURITY, AND EACH PERSON THAT ACQUIRES A BENEFICIAL INTEREST IN SUCH SECURITY,
AGREES THAT PRIOR TO THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD (AS
DEFINED IN THE COMPANY ORDER ESTABLISHING THE TERMS OF THIS SECURITY),
BENEFICIAL INTERESTS IN THIS SECURITY MAY ONLY BE OFFERED, RESOLD OR OTHERWISE
TRANSFERRED (A) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT OF 1933 OR (B) OUTSIDE
THE UNITED STATES IN COMPLIANCE WITH RULE 903 OR 904 UNDER THE
SECURITIES ACT OF 1933 AND, IN EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION.


 


[registration rights
legend to be included on Private Notes]


 


BY ITS ACCEPTANCE OF THE SECURITIES EVIDENCED HEREBY
OR A BENEFICIAL INTEREST IN SUCH SECURITIES, THE HOLDER OF, AND ANY PERSON THAT
ACQUIRES A BENEFICIAL INTEREST IN, SUCH SECURITIES AGREES TO BE BOUND BY THE
PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT (THE “REGISTRATION RIGHTS
AGREEMENT”) DATED AS OF NOVEMBER 20, 2007 AND RELATING TO THE REGISTRATION
UNDER THE SECURITIES ACT OF SECURITIES EXCHANGEABLE FOR THE SECURITIES
EVIDENCED HEREBY AND REGISTRATION OF THE SECURITIES EVIDENCED HEREBY.


 


B-2

















 


Illinois Commerce Commission ID No.: 6446


 


ILLINOIS POWER COMPANY

6.125% SENIOR SECURED NOTE DUE 2017


 


	
  CUSIP:

  	
   

  	
  PRINCIPAL
  AMOUNT: $250,000,000

  
	
  ISIN:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ORIGINAL
  ISSUE DATE: November 20, 2007

  	
  MATURITY
  DATE: November 15, 2017

  
	
   

  	
   

  	
   

  
	
  INTEREST
  RATE: 6.125%

  	
   

  	
  NUMBER:
  1

  



 


ILLINOIS POWER COMPANY, a
corporation of the State of Illinois (the “COMPANY”), for value received hereby
promises to pay to CEDE & CO or registered assigns, the principal amount
specified above on the Maturity Date set forth above, and to pay interest
thereon from and including the Original Issue Date specified above or from and
including the most recent Interest Payment Date to which interest has been paid
or duly provided for, semi-annually in arrears on May 15 and November 15 in
each year, commencing May 15, 2008, and on the Maturity Date, at the per annum
interest rate set forth above until the principal hereof is paid or made
available for payment. [If the Company does not comply with certain of its
obligations under the Registration Rights Agreement, this bond shall, in
accordance with Section 2(e) of the Registration Rights Agreement, bear
additional interest (“Additional Interest”) in addition to the interest
provided for in the immediately preceding sentence. For purposes of this Note,
the term “interest” shall be deemed to include interest provided for in the
second immediately preceding sentence and Additional Interest, if any.]* No
interest shall accrue on the Maturity Date, so long as the principal amount of
this Note is paid in full on the Maturity Date. The interest so payable and
punctually paid or duly provided for on any such Interest Payment Date will
(except for interest payable on the Maturity Date set forth above or, if
applicable, upon redemption or acceleration), as provided in the Indenture (as
defined below), be paid to the Person in whose name this Note is registered at
the close of business on the Regular Record Date for such interest, which shall
be May 1 or November 1, as the case may be, next preceding such Interest
Payment Date; provided, that the first Interest Payment Date for any part of
this Note, the Original Issue Date of which is after a Regular Record Date but
prior to the applicable Interest Payment Date, shall be the Interest Payment
Date following the next succeeding Regular Record Date; and provided, that
interest payable on the Maturity Date set forth above or, if applicable, upon
redemption or acceleration, shall be payable to the Person to whom principal
shall be payable. Except as otherwise provided in the Indenture (referred to on
the reverse hereof), 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 shall be paid to the Person in whose name this Note is registered at
the close of business on a Special Record Date for the payment of such
defaulted interest to be fixed by the Trustee, notice whereof shall be given to
Noteholders not more than fifteen days nor fewer than ten days prior to such
Special Record Date. Principal, applicable premium and interest due at the
Maturity of this Note shall be payable in immediately 


 






* Include bracketed language only in a Private Note.


 


B-3

















 


available funds
when due upon presentation and surrender of this Note at the corporate trust
office of the Trustee or at the authorized office of any paying agent in the
Borough of Manhattan, The City and State of New York or Chicago, Illinois.
Interest on this Note (other than interest payable at Maturity) shall be paid
by check payable in clearinghouse funds to the Holder as its name appears on
the register; provided, that if the Trustee receives a written request from any
Holder of Notes, the aggregate principal amount of all of which having the same
Interest Payment Date as this Note equals or exceeds $10,000,000, on or before
the applicable Regular Record Date for such Interest Payment Date, interest on
the Note shall be paid by wire transfer of immediately available funds to a
bank within the continental United States (designated by such Holder in its
request or by direct deposit into the account of such Holder designated by such
Holder in its request if such account is maintained with the Trustee or any
paying agent).


 


REFERENCE IS HEREBY MADE
TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH IN FULL ON THE REVERSE HEREOF,
WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET
FORTH IN FULL AT THIS PLACE.


 


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


 


B-4

















 


IN WITNESS WHEREOF, the
Company has caused this instrument to be duly executed.


 


	
   

  	
  ILLINOIS POWER COMPANY

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  
	
   

  	
  Attest:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  
	
  TRUSTEE’S
  CERTIFICATE

  
	
  OF
  AUTHENTICATION

  
	
   

  
	
  Dated:
  November 20, 2007

  
	
   

  
	
  This
  Note is one of the Notes of the series herein

  
	
  designated,
  described or provided for in the within-

  
	
  mentioned
  Indenture.

  
	
   

  
	
  THE BANK OF NEW YORK
  TRUST COMPANY, N.A., As Trustee

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Authorized Signatory

  
						



 


B-5

















 


[FORM OF REVERSE OF NOTE]


 


ILLINOIS POWER COMPANY

6.125% SENIOR SECURED NOTE DUE 2017


 


This Note is one of a
duly authorized issue of 6.125% Senior Secured Notes due 2017 (the “NOTES OF
THIS SERIES”) of the Company issued and to be issued under an Indenture dated
as of June 1, 2006, between the Company and The Bank of New York Trust
Company, N.A., as trustee (herein called the “TRUSTEE”, which term includes any
successor Trustee under the Indenture) and indentures supplemental thereto
(collectively, the “INDENTURE”). Under the Indenture, one or more series of
notes may be issued and, as used herein, the term “Notes” refers to the Notes
of this Series. Reference is hereby made to the Indenture for a more complete
statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Noteholders and of
the terms upon which the Notes are and are to be authenticated and delivered.
This Note is one of the series designated on the face hereof, issued in the
initial aggregate principal amount of $250,000,000.


 


The Notes will be secured
by mortgage bonds (the “SENIOR NOTE MORTGAGE BONDS”) delivered by the Company
to the Trustee for the benefit of the Holders of the Notes, issued under the
General  Mortgage Indenture and Deed of
Trust, dated as of November 1, 1992 between the Company and The Bank of
New York Trust Company, N.A. (formerly BNY Midwest Trust Company), as successor
trustee (the “MORTGAGE TRUSTEE”), as supplemented and modified (collectively,
the “MORTGAGE”). Reference is made to the Mortgage and the Indenture for a
description of the rights of the Trustee as holder of the Senior Note Mortgage
Bonds, the property mortgaged and pledged, the nature and extent of the
security and the rights of the holders of mortgage bonds, under the Mortgage
and the rights of the Company and of the Mortgage Trustee in respect thereof,
the duties and immunities of the Mortgage Trustee and the terms and conditions
upon which the Senior Note Mortgage Bonds are secured and the circumstances
under which additional mortgage bonds may be issued.


 


So long as any of the
Notes of this Series are outstanding, the Company will not optionally redeem,
purchase or otherwise retire in full its outstanding Mortgage Bonds not subject
to the release provisions of the Indenture, and, therefore, the Release Date
will not occur.


 


Each Note of this Series
shall be dated and issued as of the date of its authentication by the Trustee
and shall bear an Original Issue Date. Each Note of this Series issued upon
transfer, exchange or substitution of such Note shall bear the Original Issue
Date of such transferred, exchanged or substituted Note, as the case may be.


 


Interest on this Note
will accrue from and including the Original Issue Date specified above to, but
excluding, May 15, 2008, and thereafter, from and including each Interest
Payment Date to, but excluding, the next succeeding Interest Payment Date or
the Maturity Date, as the case may be.


 


Interest payments for
this Note shall be computed on the basis of a 360-day year consisting of twelve
30-day months. If any Interest Payment Date falls on a day that is not a
Business Day, the Interest Payment Date will be the next succeeding Business
Day (and without 


 


B-6

















 


any interest or
other payment in respect of any such delay). If the Maturity Date of this Note
or any redemption date falls on a day that is not a Business Day, the payment
of principal, premium, if any, and interest will be made on the next succeeding
Business Day, and no interest on such payment shall accrue for the period from
and after the Maturity Date or such redemption date.


 


All or a portion of the
Notes of this Series may be redeemed at the option of the Company at any time
or from time to time. The redemption price for the Notes of this Series to be
redeemed on any redemption date will be equal to the greater of the following
amounts: (a) 100% of the principal amount of the Notes of this Series
being redeemed on the redemption date; or (b) the sum of the present values of
the remaining scheduled payments of principal and interest on the Notes of this
Series being redeemed on that redemption date (not including any portion of any
payments of interest accrued to the redemption date) discounted to the
redemption date on a semiannual basis at the Adjusted Treasury Rate (as defined
below) plus 30 basis points, as determined by the Reference Treasury Dealer (as
defined below); plus, in each case, accrued and unpaid interest thereon to the
redemption date. Notwithstanding the foregoing, installments of interest on Notes
of this Series that are due and payable on Interest Payment Dates falling on or
prior to a redemption date will be payable on the Interest Payment Date to the
Holder of this Note as of the close of business on the relevant Regular Record
Date. The redemption price will be calculated on the basis of a 360-day year
consisting of twelve 30-day months.


 


The Company shall mail
notice of any redemption at least 30 days but not more than 60 days before the
redemption date to each Holder of the Notes of this Series to be redeemed.
Unless the Company defaults in payment of the redemption price, on and after
the redemption date, interest will cease to accrue on the Notes of this Series
or portions thereof called for redemption.


 


“ADJUSTED TREASURY RATE”
means, with respect to any redemption date, the rate per annum equal to the
semiannual equivalent yield to maturity of the Comparable Treasury Issue,
assuming 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.


 


“COMPARABLE TREASURY
ISSUE” means the United States Treasury security selected by the Reference
Treasury Dealer as having a maturity comparable to the remaining term of the
Notes of this Series 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 of comparable maturity to the remaining
term of such Notes of this Series.


 


“COMPARABLE TREASURY PRICE”
means, with respect to any redemption date, (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 four such Reference Treasury Dealer Quotations, the
average of all such quotations, or (C) if only one Reference Treasury Dealer
Quotation is received, such quotation.


 


“REFERENCE TREASURY
DEALER” means (A) Barclays Capital Inc., BNP Paribas Securities Corp., J.P.
Morgan Securities Inc. or Lazard Capital Markets LLC or their respective 


 


B-7

















 


affiliates which
are primary U.S. Government securities dealers in New York City (each, a “Primary
Treasury Dealer”), and their respective successors; provided, however, that if
any of the foregoing shall cease to be a Primary Treasury Dealer, the Company
shall substitute therefor another Primary Treasury Dealer; and (B) any other
Primary Treasury Dealer(s) selected by the Trustee after consultation with the
Company.


 


“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. (New York City time) on the third
Business Day preceding such redemption date.


 


The Company, at its
option, and subject to the terms and conditions provided in the Indenture, will
be discharged from any and all obligations in respect of the Notes of this
Series (except for certain obligations including obligations to register the
transfer or exchange of Notes of this Series, replace stolen, lost or mutilated
Notes of this Series, maintain paying agencies and hold monies for payment in
trust, all as set forth in the Indenture) if the Company deposits with the
Trustee money, U.S. Government Obligations which through the payment of
interest thereon and principal thereof in accordance with their terms will
provide money, or a combination of money and U.S. Government Obligations, in
any event in an amount sufficient, without reinvestment, to pay all the principal
of and any premium and interest on the Notes of this Series on the dates such
payments are due in accordance with the terms of the Notes of this Series.


 


If an Event of Default
shall occur and be continuing with respect to the Notes, the principal of and
interest on the Notes may be declared due and payable in the manner and with
the effect provided in the Indenture and, upon such declaration, the Trustee
shall demand the redemption of the Senior Note Mortgage Bonds to the extent
provided in the Indenture.


 


The Indenture permits,
with certain exceptions as therein provided, the amendment thereof and the
modifications of the rights and obligations of the Company and the rights of
the Noteholders 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 outstanding Notes. Any such consent or waiver by the Holder of this Note
shall be conclusive and binding upon such Holder and upon all future Holders of
this Note and of any Note issued upon the registration of transfer hereof or in
exchange therefor or in lieu thereof whether or not notation of such consent or
waiver is made upon this Note.


 


As set forth in and
subject to the provisions of the Indenture, no Holder of any Notes will have
any right to institute any proceeding with respect to the Indenture or for any
remedy thereunder unless such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default with respect to such Notes, the
Holders of a majority in aggregate principal amount of the outstanding Notes
affected by such Event of Default shall have made written request and offered
reasonable indemnity to the Trustee to institute such proceeding as Trustee and
the Trustee shall have failed to institute such proceeding within 60 days;
provided, however, that such limitations do not apply to a suit instituted by
the Holder hereof for the 


 


B-8

















 


enforcement of
payment of the principal of and any premium or interest on this Note on or
after the respective due dates expressed herein.


 


No reference herein to
the Indenture and to provisions of this Note or of the Indenture shall alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of and any premium and interest on this Note at the times,
places and rates and the coin or currency prescribed in the Indenture.


 


As provided in the
Indenture and subject to certain limitations therein set forth, the transfer of
this Note is registrable in the Note register. Upon surrender of this Note for
registration or transfer at the corporate trust office of the Trustee or such
other office or agency as may be designated by the Company in the Borough of
Manhattan, the City and State of New York, or Chicago, Illinois, endorsed by or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Note registrar, duly executed by the Holder hereof or the
attorney in fact of such Holder duly authorized in writing, one or more new
Notes of this Series of like tenor and of authorized denominations and for the
same aggregate principal amount will be issued to the designated transferee or
transferees.


 


The Notes of this Series
are issuable only in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000 thereof. As provided in the Indenture
and subject to certain limitations therein set forth, Notes of this Series are
exchangeable for a like aggregate principal amount of Notes of this Series of
like tenor and 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 this Note for registration of transfer, the Company, the Trustee and any
agent of the Company or the Trustee may treat the Person in whose name this
Note is registered as the owner thereof for all purposes, whether or not this
Note is overdue, and neither the Company, the Trustee nor any such agent shall
be affected by notice to the contrary.


 


The Indenture and the
Notes shall be governed by, and construed in accordance with, the laws of the
State of New York without regard to conflicts of law principles thereof.


 


All terms used in this
Note that are defined in the Indenture shall have the meanings assigned to them
in the Indenture unless otherwise indicated herein.


 


B-9

















 


ABBREVIATIONS


 


The following
abbreviations, when used in the inscription on the face of this instrument,
shall be construed as though they were written out in full according to
applicable laws or regulations:


 


	
  TEN
  COM — as tenants in common

  	
   

  	
  UNIF
  GIFT

  
	
   

  	
   

  	
  MIN
  ACT -           Custodian         

  
	
   

  	
   

  	
   

  	
  (Cust)

  	
   

  	
  (Minor)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  TEN
  ENT — as tenants by the entireties

  	
   

  	
  Under
  Uniform Gifts to Minors

  
	
   

  	
   

  	
   

  
	
  JT
  TEN — as joint tenants with right

  	
   

  	
   

  
	
  of
  survivorship and not as tenants in

  	
   

  	
   

  	
   

  
	
  common

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  State

  	
   

  
							



Additional abbreviations may also be used 

though not in the above list.


 


____________________


 


B-10

















 


CERTIFICATE OF TRANSFER*


 


ILLINOIS POWER COMPANY


 


6.125% Senior Secured Notes due 2017


 


FOR
VALUE RECEIVED, the undersigned sells, assigns and transfers unto


 


PLEASE
INSERT SOCIAL SECURITY OR OTHER


IDENTIFYING
NUMBER OF ASSIGNEE


 


Name
and address of assignee must be printed or typewritten.


 


$         


 


principal
amount of beneficial interest in the referenced Security of the Company and
does hereby irrevocably constitute and appoint to transfer the said beneficial
interest in such Security, with full power of substitution in the premises.


 


The
undersigned certifies that said beneficial interest in said Security is being
resold, pledged or otherwise transferred as follows:


 


(check
one)


 


•                              to the Company;


 


•                              to a Person whom the undersigned reasonably
believes is a qualified institutional buyer within the meaning of Rule 144A
under the Securities Act of 1933, as amended (the “Securities Act”), purchasing
for its own account or for the account of a qualified institutional buyer to
whom notice is given that the resale, pledge or other transfer is being made in
reliance on Rule 144A;


 


•                              in an offshore transaction in accordance with
Rule 903 or 904 of Regulation S under the Securities Act;


 


•                              to an institution that is an “accredited investor”
as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is
acquiring this Security for investment purposes and not for distribution
(attach a copy of an Institutional Accredited Investor Certificate in the form
annexed signed by an authorized officer of the transferee);


 


•                              as otherwise permitted by the non-registration
legend appearing on this Security; or


 


•                              as otherwise agreed by the Company, confirmed in
writing to the Trustee, as follows: [describe]


 


	
  Dated:

  	
   

  	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  NOTICE:  The signature to this assignment must
  correspond with the name as written upon the face of the within instrument in
  every particular without alteration or enlargement, or any change whatever.

  



 






*  Include this
form of Certificate of Transfer only in a Private Note.


 


B-11

















 


SIGNATURE GUARANTEE


 


Signatures
must be guaranteed by an “eligible guarantor institution” meeting the
requirement of the 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 registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.


 


B-12

















 


[FORM OF INSTITUTIONAL ACCREDITED INVESTOR CERTIFICATE]*


 


[Transferor
Name and Address]


 


Ladies
and Gentlemen:


 


In
connection with our proposed purchase of 6.125% Senior Secured Notes due 2017
(the “Notes”) issued by Illinois Power Company d/b/a AmerenIP (the “Issuer”),
we confirm that:


 


1.             We
have received a copy of the Offering Memorandum (the “Offering Memorandum”)
relating to the Notes and such other information as we deem necessary in order
to make our investment decision. We acknowledge that we have read and agree to
the matters stated under the caption NOTICE TO INVESTORS in such Offering
Memorandum.


 


2.             We
understand that any subsequent transfer of the Notes is subject to certain
restrictions and conditions set forth in the indenture relating to the Notes
(the “Indenture”) and as set forth under NOTICE TO INVESTORS in the Offering
Memorandum and the undersigned agrees to be bound by, and not to resell, pledge
or otherwise transfer the Notes except in compliance with such restrictions and
conditions and the Securities Act of 1933, as amended (the “Securities Act”).


 


3.             We
understand that the offer and sale of the Notes have not been registered under
the Securities Act, and that the Notes may not be offered or sold except as
permitted in the following sentence. We agree, on our own behalf and on behalf
of any accounts for which we are acting as hereinafter stated, that if we sell
any Notes, we will do so only (A) to the Issuer, (B) so long as the Notes are
eligible for resale pursuant to Rule 144A under the Securities Act (“Rule 144A”),
to a person whom we reasonably believe is a “qualified institutional buyer”
within the meaning of Rule 144A that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or other transfer is being made in reliance on Rule 144A, (C) to
an institutional “accredited investor” (as defined below) that, prior to such
transfer, furnishes to the Trustee (as defined in the Indenture) a signed
letter containing certain representations and agreements relating to the
restrictions on transfer of the Notes (substantially in the form of this
letter), (D) in an offshore transaction in accordance with Rule 904 of
Regulation S under the Securities Act, (E) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act (if available), or
(F) in accordance with another applicable exemption from the registration
requirements of, or in a transaction not subject to, the Securities Act or
pursuant to an effective registration statement under the Securities Act, and
we further agree to provide to any person purchasing any of the Notes from us a
notice advising such purchaser that resales of the Notes are restricted as
stated herein.


 






*  Include this
form only in a Private Note.


 


B-13

















 


4.             We
understand that, on any proposed resale of any Notes, we will be required to
furnish to the Trustee and the Issuer such certification and other information
as the Trustee and the Issuer may reasonably require to confirm that the
proposed sale complies with the foregoing restrictions. We further understand
that the Notes purchased by us will bear a legend to the foregoing effect.


 


5.             We
are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act) and have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and
risks of our investment in the Notes, and we and any accounts for which we are
acting are each able to bear the economic risk of our or its investment.


 


6.             We
are acquiring the Notes purchased by us for our own account or for one or more
accounts (each of which is an institutional “accredited investor”) as to each
of which we exercise sole investment discretion in each case for investment and
not with a view to, or for offer or sale in connection with, any distribution
in violation of the Securities Act.


 


You,
the Issuer 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 proceeding or official inquiry
with respect to the matters covered hereby.


 


	
   

  	
  Very
  truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


B-14