Document:

ex4_1.htm

     

    
      

       

      Exhibit
        4.1

    

    ___________________________________________________________________________________________________________

    Southern
      Indiana Gas and Electric Company

     

    

     

    with

     

    

     

    Deutsche
      Bank Trust Company Americas,

                                                                     as
      Trustee

     

    _______________

     

    Supplemental
      Indenture

     

    Relating
      to the

     

    First
      Mortgage Bonds

     

    4.50%
      Series B 1998 due 2020

     

    and

     

    5.00%
      Series B 1998 due 2030

     

    Dated
      as of April 1, 2005

     

    
      

    

    ___________________________________________________________________________________________________________

    Prepared
      by and upon      

    recordation
      return to:       

     

    William
      M.
      Libit              

    Chpman
      and Cutler LLP  

    111
      West Monroe Street

    Chicago,
      Illinois 60603    

    Supplemental
      Indenture Series 2005

    2128593 
* 
WML 
* 
2/14/08

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    Supplemental
      Indenture, dated as of April 1, 2005, between Southern Indiana Gas and Electric
      Company, a corporation organized and existing under the laws of the State of
      Indiana (hereinafter called the “Company”), party of the first part,
      and Deutsche Bank Trust Company Americas, a corporation organized and existing
      under the laws of the State of New York, formerly known as Bankers Trust
      Company, as Trustee under the Mortgage hereinafter referred to, party of the
      second part.

     

    Whereas,
      the Company heretofore executed and delivered to Deutsche Bank Trust Company
      Americas, formerly known as Bankers Trust Company, as trustee (hereinafter
      called the “Trustee”), a certain Indenture of Mortgage and Deed of
      Trust dated as of April 1, 1932, to secure an issue of bonds of the
      Company, issued and to be issued in series, from time to time, in the manner
      and
      subject to the conditions set forth in the said Indenture, and the said
      Indenture has been amended and supplemented by Supplemental Indentures dated
      as
      of August 31, 1936, October 1, 1937, March 22, 1939, July 1,
      1948, June 1, 1949, October 1, 1949, January 1, 1951,
      April 1, 1954, March 1, 1957, October 1, 1965, September 1,
      1966, August 1, 1968, May 1, 1970, August 1, 1971, April 1,
      1972, October 1, 1973, April 1, 1975, January 15, 1977,
      April 1, 1978, June 4, 1981, January 20, 1983, November 1,
      1983, March 1, 1984, June 1, 1984, November 1, 1984, July 1,
      1985, November 1, 1985, June 1, 1986, November 15, 1986,
      January 15, 1987, December 15, 1987, December 13, 1990,
      April 1, 1993, May 1, 1993, June 1, 1993, July 1, 1999,
      March 1, 2000, August 1, 2004 and October 1, 2004, which Indenture as
      so amended and supplemented is hereinafter referred to as the
“Mortgage” and as further supplemented by this Supplemental Indenture
      is hereinafter referred to as the “Indenture”; and

     

    Whereas,
      the Mortgage provides that the Company and the Trustee may, from time to time,
      enter into such indentures supplemental to the Mortgage as shall be deemed
      by
      them necessary or desirable; and

     

    Whereas,
      the Company entered into a Loan Agreement dated as of March 1, 1998, as
      supplemented and amended by the First Amendment to Loan Agreement dated as
      of
      April 1, 2005 (the “Loan Agreement”), with the Indiana Development
      Finance Authority (the “Authority”) pursuant to which the Authority
      issued $26,640,000 aggregate principal amount of its Pollution Control Refunding
      Revenue Bonds, 1998 Series B (Southern Indiana Gas and Electric Company Project)
      of which $26,640,000 principal amount is currently outstanding (the
“Authority Bonds”), pursuant to a resolution of the governing body of
      the Authority adopted on February 17, 1998 (the “Resolution”) and in
      accordance with the terms of an Indenture of Trust, dated as of March 1,
      1998, as supplemented and amended by the First Supplemental Indenture of Trust,
      dated as of January 1, 1999, the Second Supplemental Indenture of Trust, dated
      as of April 1, 2003, and the Third Supplemental Indenture of Trust, dated
      as of April 1, 2005 (the “Authority Indenture”), between the Authority
      and The Bank of New York Trust Company, N.A., as successor to Citizens Trust
      Company of Indiana, National Association, as trustee (the “Authority
      Trustee”), in order to provide funds to loan to the Company for the purpose
      of refunding (i) the City of Boonville, Indiana Pollution Control Revenue Bonds,
      1973 Series (Southern Indiana Gas and Electric Company Project) originally
      issued in the aggregate principal amount of $5,640,000, of which $4,640,000
      principal amount was outstanding at the time of issuance of the Authority Bonds,
      which were issued for the purpose of financing the costs of acquiring,
      constructing and equipping certain air and water pollution control 

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    facilities
      located at the Company’s Culley Steam Electric Generating Station and (ii) the
      City of Mount Vernon, Indiana Pollution Control Revenue Bonds, 1978 Series
      A
      (Southern Indiana Gas and Electric Company Project) in the aggregate principal
      amount of $22,000,000, all of which was outstanding at the time of issuance
      of
      the Authority Bonds, which were issued for the purpose of financing the costs
      of
      acquiring, constructing, equipping and installing certain air and water
      pollution control, sewage and solid waste facilities located at the Company’s
      A.B. Brown Facility; and

     

    Whereas,
      in order for the Company to obtain a bond insurance policy for the Authority
      Bonds, it was necessary for the Company to enter into an agreement with Ambac
      Assurance Corporation pursuant to which the Company agreed to use its best
      efforts to obtain all required approvals and deliver its bonds to the Authority
      Trustee to secure the Company’s obligations relating to the Authority Bonds
      under the Loan Agreement; and

     

    Whereas,
      in connection with the foregoing, it is necessary for the Authority to amend
      the
      Authority Indenture and the Loan Agreement to allow for the Company to issue
      its
      bonds; and

     

    Whereas,
      the Company by appropriate company action in conformity with the terms of the
      Indenture has duly determined to create two new series of bonds which shall
      be
      issued under the Indenture in an aggregate principal amount of $26,640,000
      and
      be designated as (i) “First Mortgage Bonds, 4.50% Series B 1998 due 2020”
in an aggregate principal amount of $4,640,000 (hereinafter sometimes referred
      to as “Bonds of the Fortieth Series”), the bonds of which series are to
      bear interest at the rate per annum set forth in the title thereof and are
      subject to certain optional and mandatory redemption rights and obligations
      set
      forth herein and (ii) “First Mortgage Bonds, 5.00% Series B 1998 due 2030”
in an aggregate principal amount of $22,000,000 (hereinafter sometimes referred
      to as “Bonds of the Forty-first Series”), the bonds of which series are
      to bear interest at the rate per annum set forth in the title thereof and are
      subject to certain optional and mandatory redemption rights and obligations
      set
      forth herein; and

     

    Whereas,
      all things necessary to make the Bonds of the Fortieth Series and the Bonds
      of
      the Forty-first Series, when authenticated by the Trustee and issued as in
      the
      Indenture provided, the valid, binding and legal obligations of the Company,
      entitled in all respects to the security of the Indenture, have been done and
      performed, and the creation, execution and delivery of this Supplemental
      Indenture has in all respects been duly authorized; and 

     

     Whereas,
      the Company and the Trustee deem it advisable to enter into this Supplemental
      Indenture for the purposes above stated and for the purpose of describing the
      Bonds of the Fortieth Series and the Bonds of the Forty-first Series, and of
      providing the terms and conditions of redemption thereof;

     

    Now,
      Therefore, This Supplemental Indenture Witnesseth:  That Southern
      Indiana Gas and Electric Company, in consideration of the premises and of one
      dollar to it duly paid by the Trustee at or before the ensealing and delivery
      of
      these presents, the receipt whereof is hereby acknowledged, and of the

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    purchase
      and acceptance of the bonds issued or to be issued hereunder by the holders
      or
      registered owners thereof, and in order to secure the payment of the principal,
      premium, if any, and interest of all bonds at any time issued and outstanding
      under the Indenture, according to their tenor and effect, and the performance
      of
      all of the provisions hereof and of said bonds, hath granted, bargained, sold,
      released, conveyed, assigned, transferred, pledged, set over and confirmed
      and
      by these presents doth grant, bargain, sell, release, convey, assign, transfer,
      pledge, set over and confirm unto Deutsche Bank Trust Company Americas, formerly
      known as Bankers Trust Company, as Trustee, and to its successor or successors
      in said trust, and to its and their assigns forever, all the properties, real,
      personal and mixed, tangible and intangible of the character described in the
      granting clauses of the aforesaid Indenture of Mortgage and Deed of Trust dated
      as of April 1, 1932 or in any indenture supplemental thereto acquired by
      the Company on or after the date of the execution and delivery of said Indenture
      of Mortgage and Deed of Trust (except any in said Indenture of Mortgage and
      Deed
      of Trust or in any indenture supplemental thereto expressly excepted) and does
      hereby confirm that the Company will not cause or consent to a partition, either
      voluntary or through legal proceedings, of property, whether herein described
      or
      heretofore or hereafter acquired, in which its ownership shall be as a tenant
      in
      common, except as permitted by and in conformity with the provisions of the
      Indenture and particularly of Article X thereof.

     

    Together
      with all and singular the tenements, hereditaments and appurtenances belonging
      or in any wise appertaining to the aforesaid property or any part thereof,
      with
      the reversion and reversions, remainder and remainders and (subject to the
      provisions of Article X of the Indenture), the tolls, rents, revenues,
      issues, earnings, income, product and profits thereof, and all the estate,
      right, title, interest and claim whatsoever, at law as well as in equity, which
      the Company now has or may hereafter acquire in and to the aforesaid property
      and franchises and every part and parcel thereof.

     

    To
      Have
      and to Hold all such properties, real, personal and mixed, mortgaged, pledged
      or
      conveyed by the Company as aforesaid, or intended so to be, unto the Trustee
      and
      its successors and assigns forever.

     

    In
      Trust,
      Nevertheless, upon the terms and trusts of the Indenture, for those who shall
      hold the bonds and coupons issued and to be issued thereunder, or any of them,
      without preference, priority or distinction as to lien of any of said bonds
      and
      coupons over any others thereof by reason of priority in the time of the issue
      or negotiation thereof, or otherwise howsoever, subject, however, to the
      provisions in reference to extended, transferred or pledged coupons and claims
      for interest set forth in the Indenture (and subject to any sinking funds that
      may be created for the benefit of any particular series).

     

    Provided,
      However, and these presents are upon the condition that, if the Company, its
      successors or assigns, shall pay or cause to be paid, the principal of, premium,
      if any, and interest on said bonds, at the times and in the manner stipulated
      therein and herein, and shall keep, perform and observe all and singular the
      covenants and promises in said bonds and in the Indenture expressed to be kept,
      performed and observed by or on the part of the Company, then this Supplemental
      Indenture and the estate and rights hereby granted shall cease, determine and
      be
      void, otherwise to be and remain in full force and effect.

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    It
      Is
      Hereby Covenanted, Declared and Agreed, by the Company, that all such bonds
      and
      coupons are to be issued, authenticated and delivered, and that all property
      subject or to become subject hereto is to be held, subject to the further
      covenants, conditions, uses and trusts in the Indenture set forth, and the
      Company, for itself and its successors and assigns, does hereby covenant and
      agree to and with the Trustee and its successor or successors in such trust,
      for
      the benefit of those who shall hold said bonds and interest coupons, or any
      of
      them, as follows:

     

    Part I

     

    The
      forms
      of the definitive registered bonds without coupons of the Bonds of the Fortieth
      Series and the Trustee’s certificate of authentication to be borne by such bonds
      are to be substantially in the following forms, respectively:

     

    

    “[form
      of
      fully registered Bond of the Fortieth Series]

    

    [form
      of
      face of bond]

     

    Southern
      Indiana Gas and Electric Company

     

    

     

    First
      Mortgage Bond, 4.50% Series B 1998 Due 2020

     

    No. _____                                                                        $4,640,000

     

    Southern
      Indiana Gas and Electric Company, a corporation of the State of Indiana
      (hereinafter called the “Company”), for value received, hereby promises
      to pay to _________________________
      ______________________________________________________ or registered assigns
      Four Million Six Hundred Forty Thousand dollars, on March 1, 2020 at the office
      or agency of the Company in the Borough of Manhattan, The City of New York,
      N.Y., in any coin or currency of the United States of America which at the
      time
      of payment is legal tender for the payment of public and private debts, and
      to
      pay to the registered owner hereof interest thereon at the rate of four and
      one-half per centum (4.50%) per annum, same as the rate of interest on the
      Pollution Control Refunding Revenue Bonds, 1998 Series B (Southern Indiana
      Gas
      and Electric Company Project) (the “Authority Bonds”) due March 1, 2020
      and issued by the Indiana Development Finance Authority (the
“Authority”) under the Indenture of Trust, dated as of March 1, 1998,
      as supplemented and amended by the First Supplemental Indenture of Trust dated
      as of January 1, 1999, as supplemented and amended by the Second Supplemental
      Indenture of Trust dated as of April 1, 2003, as 

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    supplemented
      and amended by the Third Supplemental Indenture of Trust dated as of April
      1,
      2005, and any indenture supplemental thereto or amendatory thereof (the
“Authority Indenture”), between the Authority and The Bank of New York
      Trust Company, N.A., as successor to Citizens Trust Company of Indiana, National
      Association, as trustee (the “Authority Trustee”) (as determined in
      accordance with the Authority Indenture).  Such interest, in like coin
      or currency, payable at said office or agency on the same dates as interest
      on
      the Authority Bonds, or if this bond shall be duly called for redemption, until
      the redemption date, or if the Company shall default in the payment of the
      principal hereof, until the Company’s obligation to pay principal shall be
      discharged as provided in the hereinafter defined Mortgage, is paid until the
      principal sum is paid in full discharge under the Mortgage.

     

    The
      Company has agreed to pay the principal of, premium, if any, and interest on
      the
      Authority Bonds pursuant to a Loan Agreement dated as March 1, 1998, as
      supplemented and amended by the First Amendment to Loan Agreement dated as
      of
      April 1, 2005 (as so amended and as hereinafter supplemented and amended, the
      “Agreement”) between the Company and the Authority.  Pursuant
      to the Granting Clause of the Authority Indenture, this bond is issued to the
      Authority Trustee to secure any and all obligations of the Company under the
      Agreement with respect to payment of the Authority Bonds.  Payment of
      principal of, premium, if any, or interest on, the Authority Bonds shall
      constitute payments on this bond as further provided herein and in the
      Supplemental Indenture dated April 1, 2005, pursuant to which this bond has
      been
      authorized (the “Supplemental Indenture”).

     

    Upon
      any
      payment of the principal of, premium, if any, and interest on, all or any
      portion of the Authority Bonds, whether at maturity or otherwise or upon
      provision for the payment thereof having been made in accordance with
      Section 5.01 of the Authority Indenture, a principal amount of this bond
      equal to the principal amount of such Authority Bonds shall, to the extent
      of
      such payment of principal, premium, if any, and interest, be deemed paid and
      the
      obligation of the Company thereunder to make such payment shall be discharged
      to
      such extent and, in the case of the payment of principal, such bonds shall
      be
      surrendered to the Company for cancellation as provided in Section 7.13 of
      the Authority Indenture.  The Trustee (as hereinafter defined) may at
      any time and all times conclusively assume that the obligation of the Company
      to
      make payments under the Agreement with respect to the principal of, and interest
      on, the Authority Bonds, so far as such payments at the time have 

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    become
      due, has been fully satisfied and discharged pursuant to the foregoing sentence
      unless and until the Trustee shall have received a written notice from the
      Authority Trustee signed by one of its officers stating (i) that timely
      payment of principal of, or interest on, the Authority Bonds has not been made,
      (ii) that the Company is in arrears as to the payments required to be made
      by it to the Authority Trustee pursuant to the Agreement, and (iii) the
      amount of the arrearage.

     

    The
      provisions of this bond are continued on the reverse hereof and such continued
      provisions shall for all purposes have the same effect as though fully set
      forth
      at this place.

     

    This
      bond
      shall not become obligatory until Deutsche Bank Trust Company Americas, the
      Trustee under the Mortgage, or its successor thereunder, shall have signed
      the
      form of certificate endorsed hereon.

     

    In
      Witness Whereof, Southern Indiana Gas and Electric Company has caused this
      bond
      to be signed in its name by its President or a Vice President, by his signature
      or a facsimile thereof, and a facsimile of its corporate seal to be imprinted
      hereon, attested by its Secretary or an Assistant Secretary, by his signature
      or
      a facsimile thereof.

     

    Dated:  ______________

     

     

                                                                 SOUTHERN
      INDIANA GAS
      AND

                                                                 ELECTRIC
      COMPANY

       

                                                                     By:___________________________

                                                                    ___________________________

                                                         

     

                Attest:

     

                                       
      _____________________________   

                                              
      Secretary

    

    [Form
      of
      Trustee’s Certificate]

     

    This
      bond
      is one of the bonds of the series designated therein, described in the
      within-mentioned Mortgage.

     

                                                            Deutsche
      Bank Trust

    
                                        
                  Company
        Americas, as

                                                                           Trustee    

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    

     

     

                                                               By:
      ____________________________________

                                                               Authorized
      Officer

     

    [form
      of
      reverse of bond]

     

    Southern
      Indiana Gas and Electric Company

     

    

     

    First
      Mortgage Bond, 4.50% Series B 1998 Due 2020

     

    This
      bond
      is one of an issue of First Mortgage Bonds of the Company, issuable in series,
      and is one of the series designated in the title hereof, all issued and to
      be
      issued under and equally secured (except as to any sinking fund established
      in
      accordance with the provisions of the Mortgage hereinafter mentioned for the
      bonds of any particular series) by an Indenture of Mortgage and Deed of Trust,
      dated as of April 1, 1932, executed by the Company to Deutsche Bank Trust
      Company Americas, formerly known as Bankers Trust Company, as Trustee (the
      “Trustee”), as amended and supplemented by indentures supplemental
      thereto (herein referred to as the “Mortgage”), reference is made for a
      description of the property mortgaged and pledged, the nature and extent of
      the
      security, the rights of the holders of the bonds in respect thereof and the
      terms and conditions upon which the bonds are secured.

     

    The
      bonds
      of this series are issued and to be issued in order to evidence and secure
      a
      loan made by the Authority to the Company pursuant to a Loan Agreement dated
      as
      of March 1, 1998, as supplemented and amended.  In order to provide
      moneys to fund such loan, the Authority has issued the Authority Bonds under
      and
      pursuant to the Authority Indenture.  Payments made by the Company of
      principal, premium, if any, and interest on the bonds of this series are
      intended to be sufficient to permit payments of principal, premium, if any,
      and
      interest to be made on the Authority Bonds.  Upon certain terms and
      conditions, moneys held under and pursuant to the Authority Indenture, including
      moneys so held from the proceeds of the sale of the Authority Bonds or earnings
      on the investment of such proceeds, or redemption of the Authority Bonds shall
      be credited to or used for the payment of the bonds of this series and to the
      extent so credited or used shall satisfy a like amount otherwise due
      hereunder.

     

    The
      bonds
      of this series are subject to optional and mandatory redemption, in whole or
      in
      part, as the case may be, on each date that Authority 

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    Bonds
      are
      to be redeemed.  The principal amount of the bonds of this series to
      be redeemed on any such date shall be equal to the principal amount of Authority
      Bonds called for redemption on that date.  All redemptions of bonds of
      this series shall be at the redemption prices that correspond to the redemption
      prices for the Authority Bonds.

     

    If
      and
      whenever the Trustee or the Company is notified that an event of default has
      occurred and is continuing under Section 6.01(v) of the Authority
      Indenture, and provided that the principal of all Authority Bonds then
      outstanding and the interest thereon shall have been declared immediately due
      and payable, then not later than two business days following the occurrence
      of
      the foregoing events, the Company shall, upon not less than 30 days’ and not
      more than 45 days’ prior written notice given in the manner provided in the
      Mortgage, call for redemption on a redemption date selected by it not later
      than
      45 days following the date of such notice, all of the bonds of this series
      then outstanding, and shall on such redemption date redeem the same at a price
      equal to 100% of the principal amount thereof together with accrued interest
      thereon to the redemption date, except that such requirement or redemption
      shall
      be deemed to be waived if, prior to the date fixed for such redemption of the
      bonds of this series, such event of default is waived or cured.

     

    In
      case a
      completed default, as defined in the Mortgage, shall occur, the principal of
      this bond and all other bonds of the Company at any such time outstanding under
      the Mortgage may be declared or may become due and payable, upon the conditions
      and in the manner and with the effect provided in the Mortgage.  The
      Mortgage provides that such declaration may in certain events be waived by
      the
      holders of a majority in principal amount of the bonds entitled to vote then
      outstanding.

     

    This
      bond, subject to the limitations with regard thereto contained in the Authority
      Indenture and Section 5.05 of the Agreement, is transferable as prescribed
      in the Mortgage by the registered owner hereof in person, or by his duly
      authorized attorney, at the office or agency of the Company in the Borough
      of
      Manhattan, The City of New York, N.Y., upon surrender and cancellation of this
      bond, and thereupon, a new fully registered bond of the same series for a like
      principal amount will be issued to the transferee in exchange thereof as
      provided in 

     

    the
      Mortgage, and upon payment, if the Company shall require it, of the charges
      therein prescribed.  The Company and the Trustee may deem and treat
      the person in whose name this bond is registered as the absolute owner for
      the
      purpose of receiving payment of or on account of the principal and interest
      due
      hereon and for all other purposes.

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    As
      provided in Section 7.13 of the Authority Indenture, from and after the
      Release Date (as defined in the Authority Indenture), the obligations of the
      Company with respect to this bond shall be deemed to be satisfied and
      discharged, this bond shall cease to secure in any manner the Company’s
      obligations under the Agreement with respect to the payment of any Authority
      Bonds outstanding under the Authority Indenture, and, pursuant to
      Section 7.13 of the Authority Indenture, the Authority Trustee shall
      forthwith deliver this Bond to the Company for cancellation.

     

    The
      Bonds
      of this series are issuable as registered bonds without coupons in denominations
      of $1,000 and authorized multiples thereof.  In the manner and upon
      payment of the charges prescribed in the Mortgage, registered bonds without
      coupons of this series may be exchanged for a like aggregate principal amount
      of
      fully registered bonds without coupons of other authorized denominations of
      the
      same series, upon presentation and surrender thereof, for cancellation, to
      the
      Trustee at its principal corporate trust office in the Borough of Manhattan,
      The
      City of New York, N.Y.

     

    No
      recourse shall be had for the payment of the principal of or interest on this
      bond against any incorporator or any past, present or future subscriber to
      the
      capital stock, stockholder, officer or director of the Company or of any
      predecessor or successor corporation, either directly or through the Company
      or
      any predecessor or successor corporation, under any rule of law, statute or
      constitution or by the enforcement of any assessment or otherwise, all such
      liability of incorporators, subscribers, stockholders, officers and directors
      being released by the holder or owner hereof by the acceptance of this bond
      and
      being likewise waived and released by the terms of the Mortgage.

     

    [end
      of
      form of bond]”

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

     

    The
      forms
      of the definitive registered bonds without coupons of the Bonds of the
      Forty-first Series and the Trustee’s certificate of authentication to be borne
      by such bonds are to be substantially in the following forms,
      respectively:

     

    

    “[form
      of
      fully registered Bond of the Forty-first Series]

    

    [form
      of
      face of bond]

     

    Southern
      Indiana Gas and Electric Company

     

    

     

    First
      Mortgage Bond, 5.00% Series B 1998 Due 2030

     

    No. ____                                                                         $22,000,000

     

    Southern
      Indiana Gas and Electric Company, a corporation of the State of Indiana
      (hereinafter called the “Company”), for value received, hereby promises
      to pay to _________________________
      ______________________________________________________ or registered assigns
      Twenty Two Million dollars, on March 1, 2030 at the office or agency of the
      Company in the Borough of Manhattan, The City of New York, N.Y., in any coin
      or
      currency of the United States of America which at the time of payment is legal
      tender for the payment of public and private debts, and to pay to the registered
      owner hereof interest thereon at the rate of five per centum (5.00%) per annum,
      same as the rate of interest on the Pollution Control Refunding Revenue Bonds,
      1998 Series B (Southern Indiana Gas and Electric Company Project) (the
“Authority Bonds”) due March 1, 2030 and issued by the Indiana
      Development Finance Authority (the “Authority”) under the Indenture of
      Trust, dated as of March 1, 1998, as supplemented and amended by the First
      Supplemental Indenture of Trust dated as of January 1, 1999, as supplemented
      and
      amended by the Second Supplemental Indenture of Trust dated as of April 1,
      2003, as supplemented and amended by the Third Supplemental Indenture of Trust
      dated as of April 1, 2005, and any indenture supplemental thereto or amendatory
      thereof (the “Authority Indenture”), between the Authority and The Bank
      of New York Trust Company, N.A., as successor to Citizens Trust Company of
      Indiana, National Association, as trustee (the “Authority Trustee”) (as
      determined in accordance with the Authority Indenture).  Such
      interest, in like coin or currency, payable at said office or agency on the
      same
      dates as interest on the Authority Bonds, or if this bond shall be duly called
      for 

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    redemption,
      until the redemption date, or if the Company shall default in the payment of
      the
      principal hereof, until the Company’s obligation to pay principal shall be
      discharged as provided in the hereinafter defined Mortgage, is paid until the
      principal sum is paid in full discharge under the Mortgage.

     

    The
      Company has agreed to pay the principal of, premium, if any, and interest on
      the
      Authority Bonds pursuant to a Loan Agreement dated as March 1, 1998, as
      supplemented and amended by the First Amendment to Loan Agreement dated as
      of
      April 1, 2005 (as so amended and as hereinafter supplemented and amended, the
      “Agreement”) between the Company and the Authority.  Pursuant
      to the Granting Clause of the Authority Indenture, this bond is issued to the
      Authority Trustee to secure any and all obligations of the Company under the
      Agreement with respect to payment of the Authority Bonds.  Payment of
      principal of, premium, if any, or interest on, the Authority Bonds shall
      constitute payments on this bond as further provided herein and in the
      Supplemental Indenture dated April 1, 2005, pursuant to which this bond has
      been
      authorized (the “Supplemental Indenture”).

     

    Upon
      any
      payment of the principal of, premium, if any, and interest on, all or any
      portion of the Authority Bonds, whether at maturity or otherwise or upon
      provision for the payment thereof having been made in accordance with
      Section 5.01 of the Authority Indenture, a principal amount of this bond
      equal to the principal amount of such Authority Bonds shall, to the extent
      of
      such payment of principal, premium, if any, and interest, be deemed paid and
      the
      obligation of the Company thereunder to make such payment shall be discharged
      to
      such extent and, in the case of the payment of principal, such bonds shall
      be
      surrendered to the Company for cancellation as provided in Section 7.13 of
      the Authority Indenture.  The Trustee (as hereinafter defined) may at
      any time and all times conclusively assume that the obligation of the Company
      to
      make payments under the Agreement with respect to the principal of, and interest
      on, the Authority Bonds, so far as such payments at the time have become due,
      has been fully satisfied and discharged pursuant to the foregoing sentence
      unless and until the Trustee shall have received a written notice from the
      Authority Trustee signed by one of its officers stating (i) that timely
      payment of principal of, or interest on, the Authority Bonds has not been made,
      (ii) that the Company is in arrears as to the payments required to be made
      by it to the Authority Trustee pursuant to the Agreement, and (iii) the
      amount of the arrearage.

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

    The
      provisions of this bond are continued on the reverse hereof and such continued
      provisions shall for all purposes have the same effect as though fully set
      forth
      at this place.

     

    This
      bond
      shall not become obligatory until Deutsche Bank Trust Company Americas, the
      Trustee under the Mortgage, or its successor thereunder, shall have signed
      the
      form of certificate endorsed hereon.

     

    In
      Witness Whereof, Southern Indiana Gas and Electric Company has caused this
      bond
      to be signed in its name by its President or a Vice President, by his signature
      or a facsimile thereof, and a facsimile of its corporate seal to be imprinted
      hereon, attested by its Secretary or an Assistant Secretary, by his signature
      or
      a facsimile thereof.

     

     

    
      Dated:  ______________

       

       

                                                                  SOUTHERN
        INDIANA GAS
        AND

                                                    
            ELECTRIC
        COMPANY

       

                                                        
        By: 
        ___________________________

                                                                    
        ___________________________

       

                  Attest:

       

                                         
        _____________________________   

                                                
        Secretary

      

      [Form
        of
        Trustee’s Certificate]

       

      This
        bond
        is one of the bonds of the series designated therein, described in the
        within-mentioned Mortgage.

       

       

      
                                                                               Deutsche
          Bank Trust

                                                                                
Company
          Americas, as

                                                                                 Trustee

                                                              By:
        ___________________________

                                                                                
        Authorized Officer

      
        
          
          

        

        
          -12-

          
            

          

        

        
          
          

        

      

    

    [form
      of
      reverse of bond]

     

    Southern
      Indiana Gas and Electric Company

     

     

    First
      Mortgage Bond, 5.00% Series B 1998 Due 2030

     

    This
      bond
      is one of an issue of First Mortgage Bonds of the Company, issuable in series,
      and is one of the series designated in the title hereof, all issued and to
      be
      issued under and equally secured (except as to any sinking fund established
      in
      accordance with the provisions of the Mortgage hereinafter mentioned for the
      bonds of any particular series) by an Indenture of Mortgage and Deed of Trust,
      dated as of April 1, 1932, executed by the Company to Deutsche Bank Trust
      Company Americas, formerly known as Bankers Trust Company, as Trustee (the
      “Trustee”), as amended and supplemented by indentures supplemental
      thereto (herein referred to as the “Mortgage”), reference is made for a
      description of the property mortgaged and pledged, the nature and extent of
      the
      security, the rights of the holders of the bonds in respect thereof and the
      terms and conditions upon which the bonds are secured.

     

    The
      bonds
      of this series are issued and to be issued in order to evidence and secure
      a
      loan made by the Authority to the Company pursuant to a Loan Agreement dated
      as
      of March 1, 1998, as supplemented and amended.  In order to provide
      moneys to fund such loan, the Authority has issued the Authority Bonds under
      and
      pursuant to the Authority Indenture.  Payments made by the Company of
      principal, premium, if any, and interest on the bonds of this series are
      intended to be sufficient to permit payments of principal, premium, if any,
      and
      interest to be made on the Authority Bonds.  Upon certain terms and
      conditions, moneys held under and pursuant to the Authority Indenture, including
      moneys so held from the proceeds of the sale of the Authority Bonds or earnings
      on the investment of such proceeds, or redemption of the Authority Bonds shall
      be credited to or used for the payment of the bonds of this series and to the
      extent so credited or used shall satisfy a like amount otherwise due
      hereunder.

     

    The
      bonds
      of this series are subject to optional and mandatory redemption, in whole or
      in
      part, as the case may be, on each date that Authority 

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    Bonds
      are
      to be redeemed.  The principal amount of the bonds of this series to
      be redeemed on any such date shall be equal to the principal amount of Authority
      Bonds called for redemption on that date.  All redemptions of bonds of
      this series shall be at the redemption prices that correspond to the redemption
      prices for the Authority Bonds.

     

    If
      and
      whenever the Trustee or the Company is notified that an event of default has
      occurred and is continuing under Section 6.01(v) of the Authority
      Indenture, and provided that the principal of all Authority Bonds then
      outstanding and the interest thereon shall have been declared immediately due
      and payable, then not later than two business days following the occurrence
      of
      the foregoing events, the Company shall, upon not less than 30 days’ and not
      more than 45 days’ prior written notice given in the manner provided in the
      Mortgage, call for redemption on a redemption date selected by it not later
      than
      45 days following the date of such notice, all of the bonds of this series
      then outstanding, and shall on such redemption date redeem the same at a price
      equal to 100% of the principal amount thereof together with accrued interest
      thereon to the redemption date, except that such requirement or redemption
      shall
      be deemed to be waived if, prior to the date fixed for such redemption of the
      bonds of this series, such event of default is waived or cured.

     

    In
      case a
      completed default, as defined in the Mortgage, shall occur, the principal of
      this bond and all other bonds of the Company at any such time outstanding under
      the Mortgage may be declared or may become due and payable, upon the conditions
      and in the manner and with the effect provided in the Mortgage.  The
      Mortgage provides that such declaration may in certain events be waived by
      the
      holders of a majority in principal amount of the bonds entitled to vote then
      outstanding.

     

    This
      bond, subject to the limitations with regard thereto contained in the Authority
      Indenture and Section 5.05 of the Agreement, is transferable as prescribed
      in the Mortgage by the registered owner hereof in person, or by his duly
      authorized attorney, at the office or agency of the Company in the Borough
      of
      Manhattan, The City of New York, N.Y., upon surrender and cancellation of this
      bond, and thereupon, a new fully registered bond of the same series for a like
      principal amount will be issued to the transferee in exchange thereof as
      provided in the Mortgage, and upon payment, if the Company shall require it,
      of
      the charges therein prescribed.  The Company and the Trustee may deem
      and treat the person in whose name this bond is registered as the absolute
      owner
      for the purpose of receiving payment of or on account of the principal and
      interest due hereon and for all other purposes.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

    As
      provided in Section 7.13 of the Authority Indenture, from and after the
      Release Date (as defined in the Authority Indenture), the obligations of the
      Company with respect to this bond shall be deemed to be satisfied and
      discharged, this bond shall cease to secure in any manner the Company’s
      obligations under the Agreement with respect to the payment of any Authority
      Bonds outstanding under the Authority Indenture, and, pursuant to
      Section 7.13 of the Authority Indenture, the Authority Trustee shall
      forthwith deliver this Bond to the Company for cancellation.

     

    The
      Bonds
      of this series are issuable as registered bonds without coupons in denominations
      of $1,000 and authorized multiples thereof.  In the manner and upon
      payment of the charges prescribed in the Mortgage, registered bonds without
      coupons of this series may be exchanged for a like aggregate principal amount
      of
      fully registered bonds without coupons of other authorized denominations of
      the
      same series, upon presentation and surrender thereof, for cancellation, to
      the
      Trustee at its principal corporate trust office in the Borough of Manhattan,
      The
      City of New York, N.Y.

     

    No
      recourse shall be had for the payment of the principal of or interest on this
      bond against any incorporator or any past, present or future subscriber to
      the
      capital stock, stockholder, officer or director of the Company or of any
      predecessor or successor corporation, either directly or through the Company
      or
      any predecessor or successor corporation, under any rule of law, statute or
      constitution or by the enforcement of any assessment or otherwise, all such
      liability of incorporators, subscribers, stockholders, officers and directors
      being released by the holder or owner hereof by the acceptance of this bond
      and
      being likewise waived and released by the terms of the Mortgage.

     

    [end
      of
      form of bond]”

     

    Part II

     

    Section
      1.     Bonds of the Fortieth Series shall mature on the
      date set forth in the form of bond relating hereto hereinbefore set forth,
      shall
      bear interest at the rate of four and one-half per centum (4.50%) per annum,
      same as the rate of interest borne by the Authority Bonds.  Such
      interest, payable on the same dates as interest on the Authority Bonds, and
      all
      bonds of said series shall be designated as hereinbefore in the seventh Whereas
      clause set forth.  Both principal of and interest on said bonds shall
      be payable, to the extent specified in the form of bond hereinabove set forth,
      in any coin or currency of the United States of America which at the time of
      payment is legal tender for the payment of public and private debts, at the
      office or agency of the Company in the Borough of Manhattan, 

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

    The
      City
      of New York, N.Y.  Definitive bonds of said series may be issued,
      originally or otherwise, only as registered bonds without coupons; and they
      and
      the Trustee’s certificate of authentication shall be substantially in the forms
      hereinbefore recited, respectively.  Definitive registered Bonds of
      the Fortieth Series may be issued in the denomination of $1,000 and in such
      other denominations (in multiples of $1,000) as the Board of Directors of the
      Company shall approve, and execution and delivery to the Trustee for
      authentication shall be conclusive evidence of such approval.  In the
      manner and upon payment of the charges prescribed in the Indenture, registered
      bonds without coupons of said series may be exchanged for a like aggregate
      principal amount of fully registered bonds without coupons of other authorized
      denominations of the same series, upon presentation and surrender thereof for
      cancellation to the Trustee at its principal corporate trust office in the
      Borough of Manhattan, The City of New York, N.Y.  However,
      notwithstanding the provisions of Section 12 of the Indenture, no charge
      shall be made upon any transfer or exchange of bonds of said series other than
      for any tax or taxes or other governmental charge required to be paid by the
      Company.  The form of the temporary bonds of said series shall be in
      substantially the form of the form of registered bond hereinbefore recited
      with
      such appropriate changes therein as are required on account of the temporary
      nature thereof.  Said temporary bonds of said series shall be in
      registered form without coupons, registrable as to principal, and shall be
      exchangeable for definitive bonds of said series when prepared.

     

    The
      person in whose name any registered bond without coupons of the Fortieth Series
      is registered at the close of business on any record date (as hereinbelow
      defined) with respect to any interest payment date shall be entitled to receive
      the interest payable on such interest payment date notwithstanding the
      cancellation of such registered bond upon any transfer or exchange thereof
      subsequent to the record date and prior to such interest payment date, except
      if
      and to the extent the Company shall default in the payment of the interest
      due
      on such interest payment date, in which case such defaulted interest shall
      be
      paid to the person in whose name such bond is registered either at the close
      of
      business on the day preceding the date of payment of such defaulted interest
      or
      on a subsequent record date for such payment if one shall have been established
      as hereinafter provided.  A subsequent record date may be established
      by or on behalf of the Company by notice mailed to the holders of bonds not
      less
      than ten days preceding such record date, which record date shall be not more
      than thirty days prior to the subsequent interest payment date.  The
      term “record date” as used in this Section with respect to any regular interest
      payment date shall mean the Interest Payment Date (as defined in the Authority
      Indenture).

     

    Except
      as
      provided in this Section, every registered bond without coupons of the Fortieth
      Series shall be dated and shall bear interest as provided in Section 10 of
      the Indenture; provided, however, that so long as there is no existing
      default in the payment of interest on the bonds, the holder of any bond
      authenticated by the Trustee between the record date for any interest payment
      date and such interest payment date shall not be entitled to the payment of
      the
      interest due on such interest payment date and shall have no claim against
      the
      Company with respect thereto; and provided, further, that, if and to
      the extent the Company shall default in the payment of the interest due on
      such
      interest payment date, then any such bond shall bear interest from the interest
      payment date to which interest has been paid.

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    Upon
      any
      payment of the principal of and interest on, all or any portion of the Authority
      Bonds, whether at maturity or otherwise or upon provision for the payment
      thereof having been made in accordance with Section 5.01 of the Authority
      Indenture, the Bonds of the Fortieth Series in a principal amount equal to
      the
      principal amount of such Authority Bonds shall, to the extent of such payment
      of
      principal and interest, be deemed paid and the obligation of the Company
      thereunder to make such payment shall be discharged to such extent and, in
      the
      case of the payment of principal, such Bonds of the Fortieth Series shall be
      surrendered to the Company for cancellation as provided in and subject to the
      terms of Section 7.13 of the Authority Indenture.  The Trustee
      may at any time and all times conclusively assume that the obligation of the
      Company under the Agreement to make payments with respect to the principal
      of
      and interest on the Authority Bonds, so far as such payments at the time have
      become due, has been fully satisfied and discharged pursuant to the foregoing
      sentence unless and until the Trustee shall have received a written notice
      from
      the Authority Trustee signed by one of its officers stating (i) that timely
      payment of principal of, or interest on, the Authority Bonds has not been made,
      (ii) that the Company is in arrears as to the payments required to be made
      by it to the Authority Trustee pursuant to the Agreement, and (iii) the amount
      of the arrearage.

     

    Section
      2.     Bonds of the Forty-first Series shall mature on
      the date set forth in the form of bond relating hereto hereinbefore set forth,
      shall bear interest at the rate of five per centum (5.00%) per annum, same
      as
      the rate of interest borne by the Authority Bonds.  Such interest,
      payable on the same dates as interest on the Authority Bonds, and all bonds
      of
      said series shall be designated as hereinbefore in the seventh Whereas clause
      set forth.  Both principal of and interest on said bonds shall be
      payable, to the extent specified in the form of bond hereinabove set forth,
      in
      any coin or currency of the United States of America which at the time of
      payment is legal tender for the payment of public and private debts, at the
      office or agency of the Company in the Borough of Manhattan, The City of New
      York, N.Y.  Definitive bonds of said series may be issued, originally
      or otherwise, only as registered bonds without coupons; and they and the
      Trustee’s certificate of authentication shall be substantially in the forms
      hereinbefore recited, respectively.  Definitive registered Bonds of
      the Forty-first Series may be issued in the denomination of $1,000 and in such
      other denominations (in multiples of $1,000) as the Board of Directors of the
      Company shall approve, and execution and delivery to the Trustee for
      authentication shall be conclusive evidence of such approval.  In the
      manner and upon payment of the charges prescribed in the Indenture, registered
      bonds without coupons of said series may be exchanged for a like aggregate
      principal amount of fully registered bonds without coupons of other authorized
      denominations of the same series, upon presentation and surrender thereof for
      cancellation to the Trustee at its principal corporate trust office in the
      Borough of Manhattan, The City of New York, N.Y.  However,
      notwithstanding the provisions of Section 12 of the Indenture, no charge
      shall be made upon any transfer or exchange of bonds of said series other than
      for any tax or taxes or other governmental charge required to be paid by the
      Company.  The form of the temporary bonds of said series shall be in
      substantially the form of the form of registered bond hereinbefore recited
      with
      such appropriate changes therein as are required on account of the temporary
      nature thereof.  Said temporary bonds of said series shall be in
      registered form without coupons, registrable as to principal, and shall be
      exchangeable for definitive bonds of said series when prepared.

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

    The
      person in whose name any registered bond without coupons of the Forty-first
      Series is registered at the close of business on any record date (as hereinbelow
      defined) with respect to any interest payment date shall be entitled to receive
      the interest payable on such interest payment date notwithstanding the
      cancellation of such registered bond upon any transfer or exchange thereof
      subsequent to the record date and prior to such interest payment date, except
      if
      and to the extent the Company shall default in the payment of the interest
      due
      on such interest payment date, in which case such defaulted interest shall
      be
      paid to the person in whose name such bond is registered either at the close
      of
      business on the day preceding the date of payment of such defaulted interest
      or
      on a subsequent record date for such payment if one shall have been established
      as hereinafter provided.  A subsequent record date may be established
      by or on behalf of the Company by notice mailed to the holders of bonds not
      less
      than ten days preceding such record date, which record date shall be not more
      than thirty days prior to the subsequent interest payment date.  The
      term “record date” as used in this Section with respect to any regular interest
      payment date shall mean the Interest Payment Date (as defined in the Authority
      Indenture).

     

    Except
      as
      provided in this Section, every registered bond without coupons of the
      Forty-first Series shall be dated and shall bear interest as provided in
      Section 10 of the Indenture; provided, however, that so long as
      there is no existing default in the payment of interest on the bonds, the holder
      of any bond authenticated by the Trustee between the record date for any
      interest payment date and such interest payment date shall not be entitled
      to
      the payment of the interest due on such interest payment date and shall have
      no
      claim against the Company with respect thereto; and provided, further,
      that, if and to the extent the Company shall default in the payment of the
      interest due on such interest payment date, then any such bond shall bear
      interest from the interest payment date to which interest has been
      paid.

     

    Upon
      any
      payment of the principal of and interest on, all or any portion of the Authority
      Bonds, whether at maturity or otherwise or upon provision for the payment
      thereof having been made in accordance with Section 5.01 of the Authority
      Indenture, the Bonds of the Forty-first Series in a principal amount equal
      to
      the principal amount of such Authority Bonds shall, to the extent of such
      payment of principal and interest, be deemed paid and the obligation of the
      Company thereunder to make such payment shall be discharged to such extent
      and,
      in the case of the payment of principal, such Bonds of the Forty-first Series
      shall be surrendered to the Company for cancellation as provided in and subject
      to the terms of Section 7.13 of the Authority Indenture.  The
      Trustee may at any time and all times conclusively assume that the obligation
      of
      the Company under the Agreement to make payments with respect to the principal
      of and interest on the Authority Bonds, so far as such payments at the time
      have
      become due, has been fully satisfied and discharged pursuant to the foregoing
      sentence unless and until the Trustee shall have received a written notice
      from
      the Authority Trustee signed by one of its officers stating (i) that timely
      payment of principal of, or interest on, the Authority Bonds has not been made,
      (ii) that the Company is in arrears as to the payments required to be made
      by it to the Authority Trustee pursuant to the Agreement, and (iii) the amount
      of the arrearage.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    Part III

     

    

     

    Miscellaneous

     

    Section 1.    
      The Company covenants that the provisions of Section 36A of the
      Indenture and of Section 1.02 of the Supplemental Indenture dated as of
      July 1, 1948, which are to remain in effect so long as any bonds of the
      series referred to in said Section shall be outstanding under the Indenture,
      shall remain in full force and effect so long as any Bonds of the Fortieth
      Series and Bonds of the Forty-first Series shall be outstanding under the
      Indenture.

     

    Section 2.    
      Except as herein otherwise expressly provided, no duties, responsibilities
      or liabilities are assumed, or shall be construed to be assumed, by the Trustee
      by reason of this Supplemental Indenture, other than as set forth in the
      Mortgage.  The Trustee shall not be responsible for the recitals
      herein or in the bonds (except the Trustee’s certificate of authentication), all
      of which are made by the Company solely.

     

    Section 3.    
      As supplemented and amended by this Supplemental Indenture, the Mortgage
      is
      in all respects ratified and confirmed, and the Mortgage and this Supplemental
      Indenture shall be read, taken and construed as one and the same
      instrument.

     

    Section 4.    
      This Supplemental Indenture may be executed in several counterparts and
      all
      such counterparts executed and delivered, each as an original, shall constitute
      but one and the same instrument.

    
      
              

                                       
    

        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

     

    In
      Witness Whereof, Southern Indiana Gas and Electric Company, party of the first
      part hereto, and Deutsche Bank Trust Company Americas, party of the second
      part
      hereto, have caused these presents to be executed in their respective names
      by
      their respective Presidents or one of their Vice Presidents or Assistant Vice
      Presidents and their respective seals to be hereunto affixed and attested by
      their respective Secretaries or one of their Assistant Secretaries or
      Associates, all as of the day and year first above written.

     

    (Seal)
      

                                                           SOUTHERN
      INDIANA GAS AND ELECTRIC

                                                      
COMPANY

     

                                                        By
      ___________________________________

                                                                            
      Robert L. Goocher

                                                                    
      Vice President and Treasurer

     

    

    

    Attest: _________________________________

                                 
      Robert E. Heidorn

                   
      Vice President, General Counsel and 

                                 
      Assistant Secretary

    

    

    (Seal)

    DEUTSCHE
      BANK TRUST COMPANY AMERICAS

     

    
      	
               

            	
                                                                                      By:_________________________________________                                   
                

            

    

                                     Susan
      Johnson

          
                          Vice
      President

    Attest:

    

    __________________________________________

                                       
      Irina Golovashchuk

                                               
      Associate

    

    
      
              

                    
    

        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    State
      of
      Indiana            )

    )
      SS

    County
      of
      Vanderburgh                    
)

    

     

    On
      this
      ___ day of _____, 2005, before me, the undersigned, a notary public in and
      for
      the county and state aforesaid, personally came Robert L. Goocher, to me known,
      who being by me duly sworn, did depose and say that he resides at 6755 River
      Ridge Drive, Newburgh, Indiana 47630; that he is Vice President and Treasurer
      of
      Southern Indiana Gas and Electric Company, one of the corporations described
      in
      and which executed the foregoing instrument; that he knows the seal of the
      said
      corporation; that the seal affixed to said instrument is such corporate seal;
      that it was so affixed by order of the Board of Directors of said corporation
      and that he signed his name thereto by like order; and the said Robert L.
      Goocher acknowledged the execution of the foregoing instrument on behalf of
      the
      said corporation as the voluntary act and deed of the said corporation for
      the
      uses and purposes therein set forth.

     

    In
      Witness Whereof, I have hereunto set my hand and seal the day and year first
      above written.

    

    

    

                    ____________________________________________

                         
                      Notary
      Public

    (Seal)

    

    My
      Commission Expires:  _____ ___, 20__

    

    My
      County
      of Residence is:  _______________________________________

    

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

    State
      of
      New York              
       ) 

    )
      SS

    County
      of
      New
      York                          
)

    

     

    On
      this
      ___ day of _____, 2005, before me, the undersigned, a notary public in and
      for
      the county and state aforesaid, personally came Susan Johnson, to me known,
      who
      being by me duly sworn, did depose and say that she resides at 154 East 46th
      Street, Brooklyn, New York 11203; that she is Vice President of Deutsche
      Bank Trust Company Americas, one of the corporations described in and which
      executed the foregoing instrument; that she knows the seal of the said
      corporation; that the seal affixed to said instrument is such corporate seal;
      that it was so affixed by order of the Board of Directors of said corporation
      and that she signed her name thereto by like order; and the said Susan Johnson
      acknowledged the execution of the foregoing instrument on behalf of the said
      corporation as the voluntary act and deed of the said corporation for the uses
      and purposes therein set forth.

     

    In
      Witness Whereof, I have hereunto set my hand and seal the day and year first
      above written.

    

    

    

               __________________________________________

                                         Notary
      Public

    (Seal)

    

    

    My
      Commission Expires:  _____ ___, 20__

    

    
      My
        County
        of Residence is: 
_______________________________________ex4_2.htm

     

    
      

       

      Exhibit
        4.2

    

    ____________________________________________________________________________________________________________________________

    Southern
      Indiana Gas and Electric Company

     

    

     

    with

     

    

     

    Deutsche
      Bank Trust Company Americas,

                                            as
      Trustee

     

    _______________

     

    Supplemental
      Indenture

     

    Relating
      to the

     

    First
      Mortgage Bonds

     

    Series
      A
      1998 due 2025

     

    And

     

    Series
      C
      1998 due 2030

     

    

     

    Dated
      as of March 1, 2006

     

    
      
        ____________________________________________________________________________________________________________________________

    

    
      
              

                  

            Prepared
              by and upon      

            recordation
              return to:       

             

            William
              M.
              Libit              

            Chpman
              and Cutler LLP  

            111
              West Monroe Street

            Chicago,
              Illinois 60603   

        Supplemental
            Indenture Series
            2006      
      

                  2130375
•
            WML •
2/14/08      
    

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

     

    Supplemental
      Indenture, dated as of March 1, 2006, between Southern Indiana Gas and Electric
      Company, a corporation organized and existing under the laws of the State of
      Indiana (hereinafter called the “Company”), party of the first part,
      and Deutsche Bank Trust Company Americas, a corporation organized and existing
      under the laws of the State of New York, formerly known as Bankers Trust
      Company, as Trustee under the Mortgage hereinafter referred to, party of the
      second part.

     

    Whereas,
      the Company heretofore executed and delivered to Deutsche Bank Trust Company
      Americas, formerly known as Bankers Trust Company, as trustee (hereinafter
      called the “Trustee”), a certain Indenture of Mortgage and Deed of
      Trust dated as of April 1, 1932, to secure an issue of bonds of the
      Company, issued and to be issued in series, from time to time, in the manner
      and
      subject to the conditions set forth in the said Indenture, and the said
      Indenture has been amended and supplemented by Supplemental Indentures dated
      as
      of August 31, 1936, October 1, 1937, March 22, 1939, July 1,
      1948, June 1, 1949, October 1, 1949, January 1, 1951,
      April 1, 1954, March 1, 1957, October 1, 1965, September 1,
      1966, August 1, 1968, May 1, 1970, August 1, 1971, April 1,
      1972, October 1, 1973, April 1, 1975, January 15, 1977,
      April 1, 1978, June 4, 1981, January 20, 1983, November 1,
      1983, March 1, 1984, June 1, 1984, November 1, 1984, July 1,
      1985, November 1, 1985, June 1, 1986, November 15, 1986,
      January 15, 1987, December 15, 1987, December 13, 1990,
      April 1, 1993, May 1, 1993, June 1, 1993, July 1, 1999,
      March 1, 2000, August 1, 2004, October 1, 2004 and April 1, 2005,
      which Indenture as so amended and supplemented is hereinafter referred to as
      the
“Mortgage” and as further supplemented by this Supplemental Indenture
      is hereinafter referred to as the “Indenture”; and

     

    Whereas,
      Section 108 of the Mortgage provides that the Company and the Trustee may,
      from
      time to time, enter into such indentures supplemental to the Mortgage as shall
      be deemed by them necessary or desirable; and

     

    Whereas,
      capitalized terms used herein and not otherwise defined shall have the meanings
      ascribed to them in Part I of this Supplemental Indenture; and

     

    Whereas,
      the Company entered into a Loan Agreement, dated as of March 1, 1998, as
      supplemented and amended by the First Amendment to Loan Agreement, dated as
      of
      March 1, 2006, with the Authority, pursuant to which the Authority issued
      $31,500,000 aggregate principal amount of its Pollution Control Refunding
      Revenue Bonds, 1998 Series A (Southern Indiana Gas and Electric Company Project)
      of which $31,500,000 principal amount is currently outstanding, pursuant to
      and
      in accordance with the terms of an Indenture of Trust, dated as of March 1,
      1998, as supplemented and amended by the First Supplemental Indenture of Trust,
      dated as of January 1, 1999, and the Second Supplemental Indenture of Trust,
      dated as of March 1, 2006, between the Authority and the Authority Trustee,
      in
      order to provide funds to loan to the Company for the purpose of refunding
      certain revenue bonds which were issued to finance or refinance the acquisition,
      construction and installation of the Company’s ownership interest in certain air
      and water pollution control, sewage and solid waste disposal facilities,
      including all machinery and other equipment required for said facilities
      described in Exhibit A to the Agreement; and

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    Whereas,
      the Company entered into a Loan Agreement, dated as of March 1, 1998, as
      supplemented and amended by the First Amendment to Loan Agreement, dated as
      of
      March 1, 2006, with the Authority, pursuant to which the Authority issued
      $22,200,000 aggregate principal amount of its Pollution Control Refunding
      Revenue Bonds, 1998 Series C (Southern Indiana Gas and Electric Company Project)
      of which $22,200,000 principal amount is currently outstanding, pursuant to
      and
      in accordance with the terms of an Indenture of Trust, dated as of March 1,
      1998, as supplemented and amended by the First Supplemental Indenture of Trust,
      dated as of January 1, 1999, and the Second Supplemental Indenture of Trust,
      dated as of March 1, 2006, between the Authority and the Authority Trustee,
      in
      order to provide funds to loan to the Company for the purpose of refunding
      certain revenue bonds, which were issued for the purpose of financing the
      acquisition, construction and equipping certain solid waste disposal facilities,
      together with certain functionally related and subordinate facilities described
      in Exhibit A to the Agreement; and

     

    Whereas,
      the Company has determined that it would be in its best interests to add a
      bond
      insurance policy with respect to each series of the Authority Bonds to be issued
      by the bond insurer to be named in the above-referenced Second Supplemental
      Indentures of Trust to insure the payment of principal and interest on the
      Authority Bonds when due and in connection therewith secure the Company’s
      obligations relating to the Authority Bonds of each series under the related
      Loan Agreement with the Company’s first mortgage bonds; and

     

    Whereas,
      the Company by appropriate company action in conformity with the terms of the
      Indenture has duly determined to create a new series of bonds which shall be
      issued under the Indenture in an aggregate principal amount of $31,500,000
      and
      be designated as “First Mortgage Bonds, Series A 1998 due 2025” (hereinafter
      sometimes referred to as “Bonds of the Forty-second Series”), the bonds
      of which series are to bear interest at the rate from time to time borne by
      the
      Authority Bonds and are subject to certain optional and mandatory redemption
      rights and obligations set forth herein; and

     

    Whereas,
      the Company by appropriate company action in conformity with the terms of the
      Indenture has duly determined to create a new series of bonds which shall be
      issued under the Indenture in an aggregate principal amount of $22,200,000
      and
      be designated as “First Mortgage Bonds, Series C 1998 due 2030” (hereinafter
      sometimes referred to as “Bonds of the Forty-third Series”), the bonds
      of which series are to bear interest at the rate from time to time borne by
      the
      Authority Bonds and are subject to certain optional and mandatory redemption
      rights and obligations set forth herein; and

     

    Whereas,
      all things necessary to make the Bonds of the Forty-second Series and the Bonds
      of the Forty-third Series, when authenticated by the Trustee and issued as
      in
      the Indenture provided, the valid, binding and legal obligations of the Company,
      entitled in all respects to the security of the Indenture, have been done and
      performed, and the creation, execution and delivery of this Supplemental
      Indenture has in all respects been duly authorized; and 

     

     Whereas,
      the Company and the Trustee deem it advisable to enter into this Supplemental
      Indenture for the purposes above stated and for the purpose of describing the
      Bonds of the Forty-second Series and the Bonds of the Forty-third Series, and
      of
      providing the terms and conditions of redemption thereof;

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    Now,
      Therefore, This Supplemental Indenture Witnesseth:  That Southern
      Indiana Gas and Electric Company, in consideration of the premises and of one
      dollar to it duly paid by the Trustee at or before the ensealing and delivery
      of
      these presents, the receipt whereof is hereby acknowledged, and of the purchase
      and acceptance of the bonds issued or to be issued hereunder by the holders
      or
      registered owners thereof, and in order to secure the payment of the principal,
      premium, if any, and interest of all bonds at any time issued and outstanding
      under the Indenture, according to their tenor and effect, and the performance
      of
      all of the provisions hereof and of said bonds, hath granted, bargained, sold,
      released, conveyed, assigned, transferred, pledged, set over and confirmed
      and
      by these presents doth grant, bargain, sell, release, convey, assign, transfer,
      pledge, set over and confirm unto Deutsche Bank Trust Company Americas, formerly
      known as Bankers Trust Company, as Trustee, and to its successor or successors
      in said trust, and to its and their assigns forever, all the properties, real,
      personal and mixed, tangible and intangible of the character described in the
      granting clauses of the aforesaid Indenture of Mortgage and Deed of Trust dated
      as of April 1, 1932 or in any indenture supplemental thereto acquired by
      the Company on or after the date of the execution and delivery of said Indenture
      of Mortgage and Deed of Trust (except any in said Indenture of Mortgage and
      Deed
      of Trust or in any indenture supplemental thereto expressly excepted) and does
      hereby confirm that the Company will not cause or consent to a partition, either
      voluntary or through legal proceedings, of property, whether herein described
      or
      heretofore or hereafter acquired, in which its ownership shall be as a tenant
      in
      common, except as permitted by and in conformity with the provisions of the
      Indenture and particularly of Article X thereof.

     

    Together
      with all and singular the tenements, hereditaments and appurtenances belonging
      or in any wise appertaining to the aforesaid property or any part thereof,
      with
      the reversion and reversions, remainder and remainders and (subject to the
      provisions of Article X of the Indenture), the tolls, rents, revenues,
      issues, earnings, income, product and profits thereof, and all the estate,
      right, title, interest and claim whatsoever, at law as well as in equity, which
      the Company now has or may hereafter acquire in and to the aforesaid property
      and franchises and every part and parcel thereof.

     

    To
      Have
      and to Hold all such properties, real, personal and mixed, mortgaged, pledged
      or
      conveyed by the Company as aforesaid, or intended so to be, unto the Trustee
      and
      its successors and assigns forever.

     

    In
      Trust,
      Nevertheless, upon the terms and trusts of the Indenture, for those who shall
      hold the bonds and coupons issued and to be issued thereunder, or any of them,
      without preference, priority or distinction as to lien of any of said bonds
      and
      coupons over any others thereof by reason of priority in the time of the issue
      or negotiation thereof, or otherwise howsoever, subject, however, to the
      provisions in reference to extended, transferred or pledged coupons and claims
      for interest set forth in the Indenture (and subject to any sinking funds that
      may be created for the benefit of any particular series).

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    Provided,
      However, and these presents are upon the condition that, if the Company, its
      successors or assigns, shall pay or cause to be paid, the principal of, premium,
      if any, and interest on said bonds, at the times and in the manner stipulated
      therein and herein, and shall keep, perform and observe all and singular the
      covenants and promises in said bonds and in the Indenture expressed to be kept,
      performed and observed by or on the part of the Company, then this Supplemental
      Indenture and the estate and rights hereby granted shall cease, determine and
      be
      void, otherwise to be and remain in full force and effect.

     

    It
      Is
      Hereby Covenanted, Declared and Agreed, by the Company, that all such bonds
      and
      coupons are to be issued, authenticated and delivered, and that all property
      subject or to become subject hereto is to be held, subject to the further
      covenants, conditions, uses and trusts in the Indenture set forth, and the
      Company, for itself and its successors and assigns, does hereby covenant and
      agree to and with the Trustee and its successor or successors in such trust,
      for
      the benefit of those who shall hold said bonds and interest coupons, or any
      of
      them, as follows:

     

    Part I

     

    Definitions

     

    The
      terms
      defined in this Part I shall, for all purposes of this Supplemental Indenture,
      have the meanings herein specified, unless the context otherwise
      requires:

     

    Authority:

     

    The
      term
“Authority” shall mean the Indiana Finance Authority, as successor to the
      Indiana Development Finance Authority, and any successor body to the duties
      and
      functions of the Authority.

     

    Authority
      Bonds:

     

    The
      term
“Authority Bonds,” when used in connection with the Bonds of the Forty-second
      Series, shall mean the $31,500,000 aggregate principal amount of Indiana
      Development Finance Authority Pollution Control Refunding Revenue Bonds, 1998
      Series A (Southern Indiana Gas and Electric Company Project) issued under and
      pursuant to the applicable Authority Indenture and, when used in connection
      with
      the Bonds of the Forty-third Series, shall mean the $22,200,000 aggregate
      principal amount of Indiana Development Finance Authority Pollution Control
      Refunding Revenue Bonds, 1998 Series C (Southern Indiana Gas and Electric
      Company Project) issued under and pursuant to the applicable Authority
      Indenture.

     

    Authority
      Indenture:

     

    The
      term
“Authority Indenture,” when used in connection with the Bonds of the
      Forty-second Series, shall mean the Indenture of Trust, dated as of
      March 1, 1998, as supplemented and amended by the First Supplemental
      Indenture of Trust, dated as of January 1, 1999, and the Second Supplemental
      Indenture of Trust, dated as of 

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    March
      1,
      2006, between the Authority and The Bank of New York Trust Company, N.A., as
      successor to Citizens Trust Company of Indiana, National Association, as
      trustee, and any other indenture supplemental thereto or amendatory thereof,
      pursuant to which the Pollution Control Refunding Revenue Bonds, 1998 Series
      A
      (Southern Indiana Gas and Electric Company Project) were issued and secured
      and,
      when used in connection with the Bonds of the Forty-third Series, shall mean
      the
      Indenture of Trust, dated as of March 1, 1998, as supplemented and amended
      by the First Supplemental Indenture of Trust, dated as of January 1, 1999,
      and
      the Second Supplemental Indenture of Trust, dated as of March 1, 2006, between
      the Authority and The Bank of New York Trust Company, N.A., as successor to
      Citizens Trust Company of Indiana, National Association, as trustee, and any
      other indenture supplemental thereto or amendatory thereof, pursuant to which
      the Pollution Control Refunding Revenue Bonds, 1998 Series C (Southern Indiana
      Gas and Electric Company Project) were issued and secured.

     

    Authority
      Trustee:

     

    The
      term
“Authority Trustee” shall mean The Bank of New York Trust Company, N.A., as
      successor to Citizens Trust Company of Indiana, National Association, or the
      person and/or corporation acting as trustee at any time under the applicable
      Authority Indenture.

     

    Loan
      Agreement or Agreement:

     

    The
      term
“Loan Agreement” or “Agreement,” when used in connection with the Bonds of the
      Forty-second Series, shall mean the Loan Agreement dated as of March 1, 1998,
      as
      supplemented and amended by the First Amendment to Loan Agreement dated as
      of
      March 1, 2006, between the Authority and the Company relating to the Pollution
      Control Refunding Revenue Bonds, 1998 Series A (Southern Indiana Gas and
      Electric Company Project), and any and all other modifications, amendments
      and
      supplements thereof and, when used in connection with the Bonds of the
      Forty-third Series, shall mean the Loan Agreement dated as of March 1, 1998,
      as
      supplemented and amended by the First Amendment to Loan Agreement dated as
      of
      March 1, 2006, between the Authority and the Company relating to the Pollution
      Control Refunding Revenue Bonds, 1998 Series C (Southern Indiana Gas and
      Electric Company Project), and any and all other modifications, amendments
      and
      supplements thereof.

     

    Part II

     

    Forms
      of Bonds of the Forty-second Series and the Forty-third
      Series

     

    The
      forms
      of the definitive registered bonds without coupons of the Bonds of the
      Forty-second Series and the Trustee’s certificate of authentication to be borne
      by such bonds are to be substantially in the following forms,
      respectively:

     

    

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    “[form
      of
      fully registered Bond of the Forty-second Series]

    

    [form
      of
      face of bond]

     

    Southern
      Indiana Gas and Electric Company

     

    

     

    First
      Mortgage Bond, Series A 1998 Due 2025

     

    No. _____ 
                                                                        $31,500,000

     

    Southern
      Indiana Gas and Electric Company, a corporation of the State of Indiana
      (hereinafter called the “Company”), for value received, hereby promises
      to pay to _________________________
      ______________________________________________________ or registered assigns
      Thirty-One Million Five Hundred Thousand dollars, on March 1, 2025 at the office
      or agency of the Company in the Borough of Manhattan, The City of New York,
      N.Y., in any coin or currency of the United States of America which at the
      time
      of payment is legal tender for the payment of public and private debts, and
      to
      pay to the registered owner hereof interest thereon at the same rate or rates
      of
      interest as the Pollution Control Refunding Revenue Bonds, 1998 Series A
      (Southern Indiana Gas and Electric Company Project) (the “Authority
      Bonds”) due March 1, 2025 and issued by the Indiana Development
      Finance Authority, as predecessor to the Indiana Finance Authority (the
“Authority”), under the Indenture of Trust, dated as of March 1, 1998,
      as supplemented and amended by the First Supplemental Indenture of Trust dated
      as of January 1, 1999, as supplemented and amended by the Second Supplemental
      Indenture of Trust dated as of March 1, 2006, and any other indenture
      supplemental thereto or amendatory thereof (the “Authority Indenture”),
      between the Authority and The Bank of New York Trust Company, N.A., as successor
      to Citizens Trust Company of Indiana, National Association, as trustee (the
      “Authority Trustee”) (as determined in accordance with the Authority
      Indenture); provided, however, that in no event shall the rate of
      interest borne by the bonds of this series exceed 15% per annum.  Such
      interest, in like coin or currency, payable at said office or agency on the
      same
      dates as interest on the Authority Bonds, or if this bond shall be duly called
      for redemption, until the redemption date, or if the Company shall default
      in
      the payment of the principal hereof, until the Company’s obligation to pay
      principal shall be discharged as provided in the hereinafter defined Mortgage,
      is paid until the principal sum is paid in full discharge under the
      Mortgage.

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    The
      Company has agreed to pay the principal of, premium, if any, and interest on
      the
      Authority Bonds pursuant to a Loan Agreement dated as March 1, 1998, as
      supplemented and amended by the First Amendment to Loan Agreement dated as
      of
      March 1, 2006 (as so amended and as hereinafter supplemented and amended, the
      “Agreement”) between the Company and the Authority.  Pursuant
      to the Granting Clauses of the Authority Indenture, this bond is issued to
      the
      Authority Trustee to secure any and all obligations of the Company under the
      Agreement with respect to payment of the Authority Bonds.  Payment of
      principal of, premium, if any, or interest on, the Authority Bonds shall
      constitute payments on this bond as further provided herein and in the
      Supplemental Indenture dated March 1, 2006, pursuant to which this bond has
      been
      authorized (the “Supplemental Indenture”).

     

    Upon
      any
      payment of the principal of, premium, if any, and interest on, all or any
      portion of the Authority Bonds, whether at maturity or otherwise or upon
      provision for the payment thereof having been made in accordance with
      Section 5.01 of the Authority Indenture, a principal amount of this bond
      equal to the principal amount of such Authority Bonds shall, to the extent
      of
      such payment of principal, premium, if any, and interest, be deemed paid and
      the
      obligation of the Company thereunder to make such payment shall be discharged
      to
      such extent and, in the case of the payment of principal, such bonds shall
      be
      surrendered to the Company for cancellation as provided in Section 7.14 of
      the Authority Indenture.  The Trustee (as hereinafter defined) may at
      any time and all times conclusively assume that the obligation of the Company
      to
      make payments under the Agreement with respect to the principal of, premium,
      if
      any, and interest on, the Authority Bonds, so far as such payments at the time
      have become due, has been fully satisfied and discharged pursuant to the
      foregoing sentence unless and until the Trustee shall have received a written
      notice from the Authority Trustee signed by one of its officers stating
      (i) that timely payment of principal of, or interest on, the Authority
      Bonds has not been made, (ii) that the Company is in arrears as to the
      payments required to be made by it to the Authority Trustee pursuant to the
      Agreement, and (iii) the amount of the arrearage.

     

    The
      provisions of this bond are continued on the reverse hereof and such continued
      provisions shall for all purposes have the same effect as though fully set
      forth
      at this place.

     

    This
      bond
      shall not become obligatory until Deutsche Bank Trust Company Americas, the
      Trustee under the Mortgage, or its successor thereunder, shall have signed
      the
      form of certificate endorsed hereon.

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    In
      Witness Whereof, Southern Indiana Gas and Electric Company has caused this
      bond
      to be signed in its name by its President or a Vice President, by his signature
      or a facsimile thereof, and a facsimile of its corporate seal to be imprinted
      hereon, attested by its Secretary or an Assistant Secretary, by his signature
      or
      a facsimile thereof.

     

    Dated:  ______________

    

    
      	
               

            	
                                                              Southern
                Indiana Gas and 

                                                  Electric
                Company

            

    

     

    
      	
               

            	
                                                          By:
                __________________________________

               

            

    

    
      	
               

            	 

            Attest: ___________________________________

                  
       Secretary

    

    [Form
      of
      Trustee’s Certificate]

     

    This
      bond
      is one of the bonds of the series designated therein, described in the
      within-mentioned Mortgage.

     

                                                        DEUTSCHE
      BANK TRUST

                                                         
COMPANY
      AMERICAS, BY

                                                                                                  DEUTSCHE
      BANK NATIONAL TRUST

                                                          
COMPANY,
      AS TRUSTEE

                                                                                                                                                                                                                                                                                                                                                                         

                                                                        

               By:   _____________________________________

                
       Authorized
      Officer

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    [form
      of
      reverse of bond]

     

    Southern
      Indiana Gas and Electric Company

     

    First
      Mortgage Bond, Series A 1998 Due 2025

     

    This
      bond
      is one of an issue of First Mortgage Bonds of the Company, issuable in series,
      and is one of the series designated in the title hereof, all issued and to
      be
      issued under and equally secured (except as to any sinking fund established
      in
      accordance with the provisions of the Mortgage hereinafter mentioned for the
      bonds of any particular series) by an Indenture of Mortgage and Deed of Trust,
      dated as of April 1, 1932, executed by the Company to Deutsche Bank Trust
      Company Americas, formerly known as Bankers Trust Company, as Trustee (the
      “Trustee”), as amended and supplemented by indentures supplemental
      thereto (herein referred to as the “Mortgage”), reference is made for a
      description of the property mortgaged and pledged, the nature and extent of
      the
      security, the rights of the holders of the bonds in respect thereof and the
      terms and conditions upon which the bonds are secured.

     

    The
      bonds
      of this series are issued and to be issued in order to evidence and secure
      a
      loan made by the Authority to the Company pursuant to the
      Agreement.  In order to provide moneys to fund such loan, the
      Authority has issued the Authority Bonds under and pursuant to the Authority
      Indenture.  Payments made by the Company of principal, premium, if
      any, and interest on the bonds of this series are intended to be sufficient
      to
      permit payments of principal, premium, if any, and interest to be made on the
      Authority Bonds.  Upon certain terms and conditions, moneys held under
      and pursuant to the Authority Indenture, including moneys so held from the
      proceeds of the sale of the Authority Bonds or earnings on the investment of
      such proceeds, or redemption of the Authority Bonds shall be credited to or
      used
      for the payment of the bonds of this series and to the extent so credited or
      used shall satisfy a like amount otherwise due hereunder.

     

    The
      bonds
      of this series are subject to optional and mandatory redemption, in whole or
      in
      part, as the case may be, on each date that Authority Bonds are to be
      redeemed.  The principal amount of the bonds of this series to be
      redeemed on any such date shall be equal to the principal amount of Authority
      Bonds called for redemption on that date.  All redemptions of bonds of
      this series shall be at the redemption prices that correspond to the redemption
      prices for the Authority Bonds.

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    If
      and
      whenever the Trustee or the Company is notified that an event of default has
      occurred and is continuing under Section 6.01(v) of the Authority
      Indenture, and provided that the principal of all Authority Bonds then
      outstanding and the interest thereon shall have been declared immediately due
      and payable, then not later than two business days following the occurrence
      of
      the foregoing events, the Company shall, upon not less than 30 days’ and not
      more than 45 days’ prior written notice given in the manner provided in the
      Mortgage, call for redemption on a redemption date selected by it not later
      than
      45 days following the date of such notice, all of the bonds of this series
      then outstanding, and shall on such redemption date redeem the same at a price
      equal to 100% of the principal amount thereof together with accrued interest
      thereon to the redemption date, except that such requirement or redemption
      shall
      be deemed to be waived if, prior to the date fixed for such redemption of the
      bonds of this series, such event of default is waived or cured.

     

    In
      case a
      completed default, as defined in the Mortgage, shall occur, the principal of
      this bond and all other bonds of the Company at any such time outstanding under
      the Mortgage may be declared or may become due and payable, upon the conditions
      and in the manner and with the effect provided in the Mortgage.  The
      Mortgage provides that such declaration may in certain events be waived by
      the
      holders of a majority in principal amount of the bonds entitled to vote then
      outstanding.

     

    This
      bond, subject to the limitations with regard thereto contained in the Authority
      Indenture and Section 5.05 of the Agreement, is transferable as prescribed
      in the Mortgage by the registered owner hereof in person, or by his duly
      authorized attorney, at the office or agency of the Company in the Borough
      of
      Manhattan, The City of New York, N.Y., upon surrender and cancellation of this
      bond, and thereupon, a new fully registered bond of the same series for a like
      principal amount will be issued to the transferee in exchange thereof as
      provided in the Mortgage, and upon payment, if the Company shall require it,
      of
      the charges therein prescribed.  The Company and the Trustee may deem
      and treat the person in whose name this bond is registered as the absolute
      owner
      for the purpose of receiving payment of or on account of the principal and
      interest due hereon and for all other purposes.

     

    As
      provided in Section 7.14 of the Authority Indenture, from and after the
      Release Date (as defined in the Authority Indenture), the obligations of the
      Company with respect to this bond shall be deemed to be satisfied and
      discharged, this bond shall cease to secure in any manner the 

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    Company’s
      obligations under the Agreement with respect to the payment of any Authority
      Bonds outstanding under the Authority Indenture, and, pursuant to
      Section 7.14 of the Authority Indenture, the Authority Trustee shall
      forthwith deliver this bond to the Company for cancellation.

     

    The
      bonds
      of this series are issuable as registered bonds without coupons in denominations
      of $1,000 and authorized multiples thereof.  In the manner and upon
      payment of the charges prescribed in the Mortgage, registered bonds without
      coupons of this series may be exchanged for a like aggregate principal amount
      of
      fully registered bonds without coupons of other authorized denominations of
      the
      same series, upon presentation and surrender thereof, for cancellation, to
      the
      Trustee at its principal corporate trust office in the Borough of Manhattan,
      The
      City of New York, N.Y.

     

    No
      recourse shall be had for the payment of the principal of or interest on this
      bond against any incorporator or any past, present or future subscriber to
      the
      capital stock, stockholder, officer or director of the Company or of any
      predecessor or successor corporation, either directly or through the Company
      or
      any predecessor or successor corporation, under any rule of law, statute or
      constitution or by the enforcement of any assessment or otherwise, all such
      liability of incorporators, subscribers, stockholders, officers and directors
      being released by the holder or owner hereof by the acceptance of this bond
      and
      being likewise waived and released by the terms of the Mortgage.

     

    [end
      of
      form of bond]”

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

     

    The
      forms
      of the definitive registered bonds without coupons of the Bonds of the
      Forty-third Series and the Trustee’s certificate of authentication to be borne
      by such bonds are to be substantially in the following forms,
      respectively:

    

    “[form
      of
      fully registered Bond of the Forty-third Series]

    

    [form
      of
      face of bond]

     

    Southern
      Indiana Gas and Electric Company

     

    First
      Mortgage Bond, Series C 1998 Due 2030

     

    No. ____                                                              
             $22,200,000

     

    Southern
      Indiana Gas and Electric Company, a corporation of the State of Indiana
      (hereinafter called the “Company”), for value received, hereby promises
      to pay to _________________________
      ______________________________________________________ or registered assigns
      Twenty-Two Million Two Hundred Thousand dollars, on March 1, 2030 at the office
      or agency of the Company in the Borough of Manhattan, The City of New York,
      N.Y., in any coin or currency of the United States of America which at the
      time
      of payment is legal tender for the payment of public and private debts, and
      to
      pay to the registered owner hereof interest thereon at the same rate or rates
      of
      interest as the Pollution Control Refunding Revenue Bonds, 1998 Series C
      (Southern Indiana Gas and Electric Company Project) (the “Authority
      Bonds”) due March 1, 2030 and issued by the Indiana Development
      Finance Authority, as predecessor to the Indiana Finance Authority (the
“Authority”), under the Indenture of Trust, dated as of March 1,
      1998, as supplemented and amended by the First Supplemental Indenture of Trust
      dated as of January 1, 1999, as supplemented and amended by the Second
      Supplemental Indenture of Trust dated as of March 1, 2006, and any other
      indenture supplemental thereto or amendatory thereof (the “Authority
      Indenture”), between the Authority and The Bank of New York Trust Company,
      N.A., as successor to Citizens Trust Company of Indiana, National Association,
      as trustee (the “Authority Trustee”) (as determined in accordance with
      the Authority Indenture); provided, however, that in no event shall the
      rate of interest borne by the bonds of this series

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

     exceed
      15% per annum.  Such interest, in like coin or currency, payable at
      said office or agency on the same dates as interest on the Authority Bonds,
      or
      if this bond shall be duly called for redemption, until the redemption date,
      or
      if the Company shall default in the payment of the principal hereof, until
      the
      Company’s obligation to pay principal shall be discharged as provided in the
      hereinafter defined Mortgage, is paid until the principal sum is paid in full
      discharge under the Mortgage.

     

    The
      Company has agreed to pay the principal of, premium, if any, and interest on
      the
      Authority Bonds pursuant to a Loan Agreement dated as March 1, 1998, as
      supplemented and amended by the First Amendment to Loan Agreement dated as
      of
      March 1, 2006 (as so amended and as hereinafter supplemented and amended, the
      “Agreement”) between the Company and the Authority.  Pursuant
      to the Granting Clauses of the Authority Indenture, this bond is issued to
      the
      Authority Trustee to secure any and all obligations of the Company under the
      Agreement with respect to payment of the Authority Bonds.  Payment of
      principal of, premium, if any, or interest on, the Authority Bonds shall
      constitute payments on this bond as further provided herein and in the
      Supplemental Indenture dated March 1, 2006, pursuant to which this bond has
      been
      authorized (the “Supplemental Indenture”).

     

    Upon
      any
      payment of the principal of, premium, if any, and interest on, all or any
      portion of the Authority Bonds, whether at maturity or otherwise or upon
      provision for the payment thereof having been made in accordance with
      Section 5.01 of the Authority Indenture, a principal amount of this bond
      equal to the principal amount of such Authority Bonds shall, to the extent
      of
      such payment of principal, premium, if any, and interest, be deemed paid and
      the
      obligation of the Company thereunder to make such payment shall be discharged
      to
      such extent and, in the case of the payment of principal, such bonds shall
      be
      surrendered to the Company for cancellation as provided in Section 7.13 of
      the Authority Indenture.  The Trustee (as hereinafter defined) may at
      any time and all times conclusively assume that the obligation of the Company
      to
      make payments under the Agreement with respect to the principal of, premium,
      if
      any, and interest on, the Authority Bonds, so far as such payments at the time
      have become due, has been fully satisfied and discharged pursuant to the
      foregoing sentence unless and until the Trustee shall have received a written
      notice from the Authority Trustee signed by one of its officers stating
      (i) that timely payment of principal of, or interest on, the Authority
      Bonds has not been made, (ii) that the Company is in arrears as to the
      payments required to be made by it to the Authority Trustee pursuant to the
      Agreement, and (iii) the amount of the arrearage.

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    The
      provisions of this bond are continued on the reverse hereof and such continued
      provisions shall for all purposes have the same effect as though fully set
      forth
      at this place.

     

    This
      bond
      shall not become obligatory until Deutsche Bank Trust Company Americas, the
      Trustee under the Mortgage, or its successor thereunder, shall have signed
      the
      form of certificate endorsed hereon.

     

    In
      Witness Whereof, Southern Indiana Gas and Electric Company has caused this
      bond
      to be signed in its name by its President or a Vice President, by his signature
      or a facsimile thereof, and a facsimile of its corporate seal to be imprinted
      hereon, attested by its Secretary or an Assistant Secretary, by his signature
      or
      a facsimile thereof.

     

    Dated:  ______________

    
      

      
        	
                 

              	
                                      Southern
                  Indiana
                  Gas and 

                                      Electric
                  Company

              

      

       

      
        	
                 

              	
                                                 
                  By: __________________________________

                 

              

      

      
        	
                 

              	 

Attest: ________________________________

                Secretary

      

      [Form
        of
        Trustee’s Certificate]

       

      This
        bond
        is one of the bonds of the series designated therein, described in the
        within-mentioned Mortgage.

       

                                                    DEUTSCHE
        BANK TRUST
                                            COMPANY
          AMERICAS,
          BY

                                            DEUTSCHE
          BANK
          NATIONAL TRUST

                                               COMPANY,
          AS TRUSTEE
                                                                                                                                                                                                                                                                                                                                                                    

                                                                          

      By:  _____________________________________

                 Authorized
        Officer

       

    

     

    
      
        
          
          

        

        
          -14-

          
            

          

        

        
          
          

        

      

    

    [form
      of
      reverse of bond]

     

    Southern
      Indiana Gas and Electric Company

     

    First
      Mortgage Bond, Series C 1998 Due 2030

     

    This
      bond
      is one of an issue of First Mortgage Bonds of the Company, issuable in series,
      and is one of the series designated in the title hereof, all issued and to
      be
      issued under and equally secured (except as to any sinking fund established
      in
      accordance with the provisions of the Mortgage hereinafter mentioned for the
      bonds of any particular series) by an Indenture of Mortgage and Deed of Trust,
      dated as of April 1, 1932, executed by the Company to Deutsche Bank Trust
      Company Americas, formerly known as Bankers Trust Company, as Trustee (the
      “Trustee”), as amended and supplemented by indentures supplemental
      thereto (herein referred to as the “Mortgage”), reference is made for a
      description of the property mortgaged and pledged, the nature and extent of
      the
      security, the rights of the holders of the bonds in respect thereof and the
      terms and conditions upon which the bonds are secured.

     

    The
      bonds
      of this series are issued and to be issued in order to evidence and secure
      a
      loan made by the Authority to the Company pursuant to the
      Agreement.  In order to provide moneys to fund such loan, the
      Authority has issued the Authority Bonds under and pursuant to the Authority
      Indenture.  Payments made by the Company of principal, premium, if
      any, and interest on the bonds of this series are intended to be sufficient
      to
      permit payments of principal, premium, if any, and interest to be made on the
      Authority Bonds.  Upon certain terms and conditions, moneys held under
      and pursuant to the Authority Indenture, including moneys so held from the
      proceeds of the sale of the Authority Bonds or earnings on the investment of
      such proceeds, or redemption of the Authority Bonds shall be credited to or
      used
      for the payment of the bonds of this series and to the extent so credited or
      used shall satisfy a like amount otherwise due hereunder.

     

    The
      bonds
      of this series are subject to optional and mandatory redemption, in whole or
      in
      part, as the case may be, on each date that Authority Bonds are to be
      redeemed.  The principal amount of the bonds of this series to be
      redeemed on any such date shall be equal to the principal amount of Authority
      Bonds called for redemption on that date.  All redemptions of bonds of
      this series shall be at the redemption prices that correspond to the redemption
      prices for the Authority Bonds.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

    If
      and
      whenever the Trustee or the Company is notified that an event of default has
      occurred and is continuing under Section 6.01(v) of the Authority
      Indenture, and provided that the principal of all Authority Bonds then
      outstanding and the interest thereon shall have been declared immediately due
      and payable, then not later than two business days following the occurrence
      of
      the foregoing events, the Company shall, upon not less than 30 days’ and not
      more than 45 days’ prior written notice given in the manner provided in the
      Mortgage, call for redemption on a redemption date selected by it not later
      than
      45 days following the date of such notice, all of the bonds of this series
      then outstanding, and shall on such redemption date redeem the same at a price
      equal to 100% of the principal amount thereof together with accrued interest
      thereon to the redemption date, except that such requirement or redemption
      shall
      be deemed to be waived if, prior to the date fixed for such redemption of the
      bonds of this series, such event of default is waived or cured.

     

    In
      case a
      completed default, as defined in the Mortgage, shall occur, the principal of
      this bond and all other bonds of the Company at any such time outstanding under
      the Mortgage may be declared or may become due and payable, upon the conditions
      and in the manner and with the effect provided in the Mortgage.  The
      Mortgage provides that such declaration may in certain events be waived by
      the
      holders of a majority in principal amount of the bonds entitled to vote then
      outstanding.

     

    This
      bond, subject to the limitations with regard thereto contained in the Authority
      Indenture and Section 5.05 of the Agreement, is transferable as prescribed
      in the Mortgage by the registered owner hereof in person, or by his duly
      authorized attorney, at the office or agency of the Company in the Borough
      of
      Manhattan, The City of New York, N.Y., upon surrender and cancellation of this
      bond, and thereupon, a new fully registered bond of the same series for a like
      principal amount will be issued to the transferee in exchange thereof as
      provided in the Mortgage, and upon payment, if the Company shall require it,
      of
      the charges therein prescribed.  The Company and the Trustee may deem
      and treat the person in whose name this bond is registered as the absolute
      owner
      for the purpose of receiving payment of or on account of the principal and
      interest due hereon and for all other purposes.

     

    As
      provided in Section 7.13 of the Authority Indenture, from and after the
      Release Date (as defined in the Authority Indenture), the obligations of the
      Company with respect to this bond shall be deemed to be satisfied and
      discharged, this bond shall cease to secure in any manner the 

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    Company’s
      obligations under the Agreement with respect to the payment of any Authority
      Bonds outstanding under the Authority Indenture, and, pursuant to
      Section 7.13 of the Authority Indenture, the Authority Trustee shall
      forthwith deliver this bond to the Company for cancellation.

     

    The
      bonds
      of this series are issuable as registered bonds without coupons in denominations
      of $1,000 and authorized multiples thereof.  In the manner and upon
      payment of the charges prescribed in the Mortgage, registered bonds without
      coupons of this series may be exchanged for a like aggregate principal amount
      of
      fully registered bonds without coupons of other authorized denominations of
      the
      same series, upon presentation and surrender thereof, for cancellation, to
      the
      Trustee at its principal corporate trust office in the Borough of Manhattan,
      The
      City of New York, N.Y.

     

    No
      recourse shall be had for the payment of the principal of or interest on this
      bond against any incorporator or any past, present or future subscriber to
      the
      capital stock, stockholder, officer or director of the Company or of any
      predecessor or successor corporation, either directly or through the Company
      or
      any predecessor or successor corporation, under any rule of law, statute or
      constitution or by the enforcement of any assessment or otherwise, all such
      liability of incorporators, subscribers, stockholders, officers and directors
      being released by the holder or owner hereof by the acceptance of this bond
      and
      being likewise waived and released by the terms of the Mortgage.

     

    [end
      of
      form of bond]”

     

    Part III

     

    Description
      of Bonds of the Forty-second Series and the Forty-third
      Series

     

    Section
      1.     Bonds of the Forty-second Series shall mature,
      subject to prior redemption, on the date set forth in the form of bond relating
      hereto hereinbefore set forth, shall bear interest at the rate from time to
      time
      borne by the Authority Bonds; provided, however, that in no event shall
      the rate of interest borne by the Bonds of the Forty-second Series exceed 15%
      per annum.  Such interest, payable on the same dates as interest on
      the Authority Bonds, and all bonds of said series shall be designated as
      hereinbefore in the seventh Whereas clause set forth.  Principal of,
      premium, if any, and interest on said bonds shall be payable, to the extent
      specified in the form of bond hereinabove set forth, in any coin or currency
      of
      the United States of America which at the time of payment is 

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

    legal
      tender for the payment of public and private debts, at the office or agency
      of
      the Company in the Borough of Manhattan, The City of New York,
      N.Y.  Definitive bonds of said series may be issued, originally or
      otherwise, only as registered bonds without coupons; and they and the Trustee’s
      certificate of authentication shall be substantially in the forms hereinbefore
      recited, respectively.  Definitive registered Bonds of the
      Forty-second Series may be issued in the denomination of $1,000 and in such
      other denominations (in multiples of $1,000) as the Board of Directors of the
      Company shall approve, and execution and delivery to the Trustee for
      authentication shall be conclusive evidence of such approval.  In the
      manner and upon payment of the charges prescribed in the Indenture, registered
      bonds without coupons of said series may be exchanged for a like aggregate
      principal amount of fully registered bonds without coupons of other authorized
      denominations of the same series, upon presentation and surrender thereof for
      cancellation to the Trustee at its principal corporate trust office in the
      Borough of Manhattan, The City of New York, N.Y.  However,
      notwithstanding the provisions of Section 12 of the Indenture, no charge
      shall be made upon any transfer or exchange of bonds of said series other than
      for any tax or taxes or other governmental charge required to be paid by the
      Company.  The form of the temporary bonds of said series shall be in
      substantially the form of the form of registered bond hereinbefore recited
      with
      such appropriate changes therein as are required on account of the temporary
      nature thereof.  Said temporary bonds of said series shall be in
      registered form without coupons, registrable as to principal, and shall be
      exchangeable for definitive bonds of said series when prepared.

     

    The
      person in whose name any registered bond without coupons of the Forty-second
      Series is registered at the close of business on any record date (as hereinbelow
      defined) with respect to any interest payment date shall be entitled to receive
      the interest payable on such interest payment date notwithstanding the
      cancellation of such registered bond upon any transfer or exchange thereof
      subsequent to the record date and prior to such interest payment date, except
      if
      and to the extent the Company shall default in the payment of the interest
      due
      on such interest payment date, in which case such defaulted interest shall
      be
      paid to the person in whose name such bond is registered either at the close
      of
      business on the day preceding the date of payment of such defaulted interest
      or
      on a subsequent record date for such payment if one shall have been established
      as hereinafter provided.  A subsequent record date may be established
      by or on behalf of the Company by notice mailed to the holders of bonds not
      less
      than ten days preceding such record date, which record date shall be not more
      than 30 days prior to the subsequent interest payment date.  The term
“record date” as used in this Section with respect to any regular interest
      payment date shall mean the Interest Payment Date (as defined in the Authority
      Indenture).

     

    Except
      as
      provided in this Section, every registered bond without coupons of the
      Forty-second Series shall be dated and shall bear interest as provided in
      Section 10 of the Indenture; provided, however, that so long as
      there is no existing default in the payment of interest on the bonds, the holder
      of any bond authenticated by the Trustee between the record date for any
      interest payment date and such interest payment date shall not be entitled
      to
      the payment of the interest due on such interest payment date and shall have
      no
      claim against the Company with respect thereto; and provided, further,
      that, if and to the extent the Company shall default in the payment of the
      interest due on such interest payment date, then any such bond shall bear
      interest from the interest payment date to which interest has been
      paid.

     

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

    Upon
      any
      payment of the principal of, premium, if any, and interest on, all or any
      portion of the Authority Bonds, whether at maturity or otherwise or upon
      provision for the payment thereof having been made in accordance with
      Section 5.01 of the Authority Indenture, the Bonds of the Forty-second
      Series in a principal amount equal to the principal amount of such Authority
      Bonds shall, to the extent of such payment of principal, premium, if any, and
      interest, be deemed paid and the obligation of the Company thereunder to make
      such payment shall be discharged to such extent and, in the case of the payment
      of principal, such Bonds of the Forty-second Series shall be surrendered to
      the
      Company for cancellation as provided in and subject to the terms of
      Section 7.14 of the Authority Indenture.  The Trustee may at any
      time and all times conclusively assume that the obligation of the Company under
      the Agreement to make payments with respect to the principal of, premium, if
      any, and interest on the Authority Bonds, so far as such payments at the time
      have become due, has been fully satisfied and discharged pursuant to the
      foregoing sentence unless and until the Trustee shall have received a written
      notice from the Authority Trustee signed by one of its officers stating
      (i) that timely payment of principal of, premium, if any, or interest on,
      the Authority Bonds has not been made, (ii) that the Company is in arrears
      as to the payments required to be made by it to the Authority Trustee pursuant
      to the Agreement, and (iii) the amount of the arrearage.

     

    Section
      2.     Bonds of the Forty-third Series shall mature,
      subject to prior redemption, on the date set forth in the form of bond relating
      hereto hereinbefore set forth, shall bear interest at the rate from time to
      time
      borne by the Authority Bonds; provided, however, that in no event shall
      the rate of interest borne by the Bonds of the Forty-third Series exceed 15%
      per
      annum.  Such interest, payable on the same dates as interest on the
      Authority Bonds, and all bonds of said series shall be designated as
      hereinbefore in the eighth Whereas clause set forth.  Principal of,
      premium, if any, and interest on said bonds shall be payable, to the extent
      specified in the form of bond hereinabove set forth, in any coin or currency
      of
      the United States of America which at the time of payment is legal tender for
      the payment of public and private debts, at the office or agency of the Company
      in the Borough of Manhattan, The City of New York, N.Y.  Definitive
      bonds of said series may be issued, originally or otherwise, only as registered
      bonds without coupons; and they and the Trustee’s certificate of authentication
      shall be substantially in the forms hereinbefore recited,
      respectively.  Definitive registered Bonds of the Forty-third Series
      may be issued in the denomination of $1,000 and in such other denominations
      (in
      multiples of $1,000) as the Board of Directors of the Company shall approve,
      and
      execution and delivery to the Trustee for authentication shall be conclusive
      evidence of such approval.  In the manner and upon payment of the
      charges prescribed in the Indenture, registered bonds without coupons of said
      series may be exchanged for a like aggregate principal amount of fully
      registered bonds without coupons of other authorized denominations of the same
      series, upon presentation and surrender thereof for cancellation to the Trustee
      at its principal corporate trust office in the Borough of Manhattan, The City
      of
      New York, N.Y.  However, notwithstanding the provisions of
      Section 12 of the Indenture, no charge shall be made upon any transfer or
      exchange of bonds of said series other than for any tax or taxes or other
      governmental charge required to be paid by the Company.  The form of
      the temporary bonds of said series shall be in substantially the form of the
      form of registered bond hereinbefore recited with such appropriate changes
      therein as are required on account of the temporary nature
      thereof.  Said temporary bonds of said series shall be in registered
      form without coupons, registrable as to principal, and shall be exchangeable
      for
      definitive bonds of said series when prepared.

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

    The
      person in whose name any registered bond without coupons of the Forty-third
      Series is registered at the close of business on any record date (as hereinbelow
      defined) with respect to any interest payment date shall be entitled to receive
      the interest payable on such interest payment date notwithstanding the
      cancellation of such registered bond upon any transfer or exchange thereof
      subsequent to the record date and prior to such interest payment date, except
      if
      and to the extent the Company shall default in the payment of the interest
      due
      on such interest payment date, in which case such defaulted interest shall
      be
      paid to the person in whose name such bond is registered either at the close
      of
      business on the day preceding the date of payment of such defaulted interest
      or
      on a subsequent record date for such payment if one shall have been established
      as hereinafter provided.  A subsequent record date may be established
      by or on behalf of the Company by notice mailed to the holders of bonds not
      less
      than ten days preceding such record date, which record date shall be not more
      than 30 days prior to the subsequent interest payment date.  The term
“record date” as used in this Section with respect to any regular interest
      payment date shall mean the Interest Payment Date (as defined in the Authority
      Indenture).

     

    Except
      as
      provided in this Section, every registered bond without coupons of the
      Forty-third Series shall be dated and shall bear interest as provided in
      Section 10 of the Indenture; provided, however, that so long as
      there is no existing default in the payment of interest on the bonds, the holder
      of any bond authenticated by the Trustee between the record date for any
      interest payment date and such interest payment date shall not be entitled
      to
      the payment of the interest due on such interest payment date and shall have
      no
      claim against the Company with respect thereto; and provided, further,
      that, if and to the extent the Company shall default in the payment of the
      interest due on such interest payment date, then any such bond shall bear
      interest from the interest payment date to which interest has been
      paid.

     

    Upon
      any
      payment of the principal of, premium, if any, and interest on, all or any
      portion of the Authority Bonds, whether at maturity or otherwise or upon
      provision for the payment thereof having been made in accordance with
      Section 5.01 of the Authority Indenture, the Bonds of the Forty-third
      Series in a principal amount equal to the principal amount of such Authority
      Bonds shall, to the extent of such payment of principal, premium, if any, and
      interest, be deemed paid and the obligation of the Company thereunder to make
      such payment shall be discharged to such extent and, in the case of the payment
      of principal, such Bonds of the Forty-third Series shall be surrendered to
      the
      Company for cancellation as provided in and subject to the terms of
      Section 7.13 of the Authority Indenture.  The Trustee may at any
      time and all times conclusively assume that the obligation of the Company under
      the Agreement to make payments with respect to the principal of, premium, if
      any, and interest on the Authority Bonds, so far as such payments at the time
      have become due, has been fully satisfied and discharged pursuant to the
      foregoing sentence unless and until the Trustee shall have received a written
      notice from the Authority Trustee signed by one of its officers stating
      (i) that timely payment of principal of, premium, if any, or interest on,
      the Authority Bonds has not been made, (ii) that the Company is in arrears
      as to the payments required to be made by it to the Authority Trustee pursuant
      to the Agreement, and (iii) the amount of the arrearage.

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    Part IV

     

    

     

    Redemption
      Provisions

     

    Section 1.    
      The Bonds of the Forty-second Series and the Bonds of the Forty-third
      Series shall be subject to redemption by the Company prior to maturity,
      respectively, in the events and in the manner and at the redemption prices
      set
      forth in the respective forms of Bond of such series contained in Part II
      hereof and not otherwise.

     

    Section 2.    
      In the manner provided by the provisions of Article IX of the
      Indenture, notice of redemption shall be mailed not less than 30 days and not
      more than 45 days prior to the date of redemption, to the registered owner
      of
      the Bonds of the Forty-second Series or of the Bonds of the Forty-third Series,
      as the case may be, at the address thereof as the same shall appear on the
      transfer register of the Company; provided, however, that the owners of
      all of the Bonds of the Forty-second Series or the owners of all of the Bonds
      of
      the Forty-third Series may agree in writing with the Company to a shorter notice
      period with respect to their respective series, and such agreement, if filed
      with the Trustee, shall be binding on the Company.

     

    Part V

     

    

     

    Miscellaneous

     

    Section 1.    
      The Company covenants that the provisions of Section 36A of the
      Indenture and of Section 1.02 of the Supplemental Indenture dated as of
      July 1, 1948, which are to remain in effect so long as any bonds of the
      series referred to in said Section shall be outstanding under the Indenture,
      shall remain in full force and effect so long as any Bonds of the Forty-second
      Series and any Bonds of the Forty-third Series shall be outstanding under the
      Indenture.

     

    Section 2.    
      Except as herein otherwise expressly provided, no duties, responsibilities
      or liabilities are assumed, or shall be construed to be assumed, by the Trustee
      by reason of this Supplemental Indenture, other than as set forth in the
      Mortgage.  The Trustee shall not be responsible for the recitals
      herein or in the bonds (except the Trustee’s certificate of authentication), all
      of which are made by the Company solely.

     

    Section 3.    
      As supplemented and amended by this Supplemental Indenture, the Mortgage
      is
      in all respects ratified and confirmed, and the Mortgage and this Supplemental
      Indenture shall be read, taken and construed as one and the same
      instrument.

     

    Section 4.    
      This Supplemental Indenture may be executed in several counterparts and
      all
      such counterparts executed and delivered, each as an original, shall constitute
      but one and the same instrument.

    
      
              

                       
    

        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

     

    In
      Witness Whereof, Southern Indiana Gas and Electric Company, party of the first
      part hereto, and Deutsche Bank Trust Company Americas, party of the second
      part
      hereto, have caused these presents to be executed in their respective names
      by
      their respective Presidents or one of their Vice Presidents or Assistant Vice
      Presidents and their respective seals to be hereunto affixed and attested by
      their respective Secretaries or one of their Assistant Secretaries or Assistant
      Vice Presidents, all as of the day and year first above written.

     

    (Seal)

    
      	
               

            	
                                                Southern
                Indiana Gas
                and Electric 

                                               
                Company

            

    

    

    

    
      	
               

            	
                                   
                By
                ________________________________________

            

    

                                                                
        Robert L.
      Goocher

                                                              Vice
      President and
      Treasurer

    Attest:

     

    _____________________________________

                               
      Robert E. Heidorn

                
      Vice President, General Counsel and 

                             
      Assistant Secretary

    

    

    (Seal)

    
      	
               

            	
                                   
                Deutsche Bank Trust Company Americas, 

                                     
                by Deutsche Bank 

                                     
                National Trust Company, as Trustee

            

    

    

    

    
      	
               

            	
                                    By
                ________________________________________

            

    

                                                           David
      Contino

                                                              Assistant
      Vice
      President

    Attest:

    

    __________________________________

                       
      Irina Golovashchuk

                 
      Assistant
      Vice President

    

    
      
              

                          
    

        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

    State
      of
      Indiana                                   
)

    )
      SS

    County
      of
      Vanderburgh                    
)

    

     

    On
      this
      ___ day of February, 2006, before me, the undersigned, a notary public in and
      for the county and state aforesaid, personally came Robert L. Goocher, to me
      known, who being by me duly sworn, did depose and say that he resides at 6755
      River Ridge Drive, Newburgh, Indiana 47630; that he is Vice President and
      Treasurer of Southern Indiana Gas and Electric Company, one of the corporations
      described in and which executed the foregoing instrument; that he knows the
      seal
      of the said corporation; that the seal affixed to said instrument is such
      corporate seal; that it was so affixed by order of the Board of Directors of
      said corporation and that he signed his name thereto by like order; and the
      said
      Robert L. Goocher acknowledged the execution of the foregoing instrument on
      behalf of the said corporation as the voluntary act and deed of the said
      corporation for the uses and purposes therein set forth.

     

    In
      Witness Whereof, I have hereunto set my hand and seal the day and year first
      above written.

    

    

    

    
 _________________________________________________________

                            Notary
      Public

    (Seal)

    

    

    
      
        
        

      

      
         

        
          

        

      

      
        
        

      

    

    State
      of
      New
      Jersey                            
)

    )
      SS

    County
      of
      Union                                 
)

    

     

    On
      this
      ___ day of February, 2006, before me, the undersigned, a notary public in and
      for the county and state aforesaid, personally came David Contino, to me known,
      who being by me duly sworn, did depose and say that he resides at
      ____________________________________; that he is Assistant Vice President of
      Deutsche Bank Trust Company Americas, one of the corporations described in
      and
      which executed the foregoing instrument; that he knows the seal of the said
      corporation; that the seal affixed to said instrument is such corporate seal;
      that it was so affixed by order of the Board of Directors of said corporation
      and that he signed his name thereto by like order; and the said David Contino
      acknowledged the execution of the foregoing instrument on behalf of the said
      corporation as the voluntary act and deed of the said corporation for the uses
      and purposes therein set forth.

     

    In
      Witness Whereof, I have hereunto set my hand and seal the day and year first
      above written.

    

    

    

    
 __________________________________________________________

                                Notary
      Public

    (Seal)

    

    

    My
      Commission Expires:  __________ ___, 20__

    

    My
      County
      of Residence is: ____________________________________

                                                     
      ____________________________________

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00136-of-00352.parquet"}]]