Document:

ex41

                                                                    Exhibit 4.1   [THIS BOND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS  AMENDED, OR THE SECURITIES OR “BLUE SKY” LAWS OF ANY OTHER JURISDICTION,  AND MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH SUCH REGISTRATION  REQUIREMENTS OR UNDER AN EXEMPTION THEREFROM.]                          POTOMAC ELECTRIC POWER COMPANY                       (A District of Columbia and Virginia corporation)                      First Mortgage Bond, 4.27% Series due June 15, 2048   No. [______]                                                       $[_________]                                                                  PPN No. [______]               POTOMAC ELECTRIC POWER COMPANY, a corporation organized and existing  under the laws of the District of Columbia and a domestic corporation of the Commonwealth of Virginia  (hereinafter called the “Company”, which term shall include any successor corporation as defined in the  Amended Indenture hereinafter referred to), for value received, hereby promises to pay to [________] or  registered assigns, the sum of [__________] Dollars ($[_______]), on the fifteenth day of June, 2048, in  lawful money of the United States of America, and to pay interest thereon in like money from the later of  the date of delivery of the initial Bonds of 4.27% Series or the June 15th or December 15th next  preceding the date of this Bond, or if the Company shall default in the payment of interest due on such  interest payment date, then from the next preceding interest payment date or the date of delivery of the  initial Bonds of 4.27% Series, whichever is later, at the rate of four and twenty-seven hundredths percent  (4.27%) per annum, payable semiannually, commencing December 15, 2018, on the fifteenth day of June  or December in each year until maturity, or, if the Company shall default in the payment of the principal  hereof, until the Company’s obligation with respect to the payment of such principal shall be discharged  as provided in the Amended Indenture. The interest so payable on any June 15th or December 15th will,  subject to certain exceptions provided in the indenture dated as of June 1, 2018 supplemental to the  Amended Indenture, be paid to the person in whose name this Bond is registered at the close of business  on the first calendar day of the month in which the interest payment date occurs. Both principal of, and  interest on, this Bond are payable at the agency of the Company in the Borough of Manhattan, The City  of New York.               Reference is made to the further provisions of this Bond set forth on the reverse hereof,  and such further provisions shall for all purposes have the same effect as though fully set forth at this  place.               This Bond shall not be entitled to any benefit under the Amended Indenture or any  indenture supplemental thereto, or become valid or obligatory for any purpose, until The Bank of New  York Mellon, the Trustee under the Amended Indenture, or a successor trustee thereto under the  Amended Indenture, shall have signed the form of certificate endorsed hereon.               IN WITNESS WHEREOF, Potomac Electric Power Company has caused this Bond to be  signed in its name by the signature (or a facsimile thereof) of its President or a Vice President, and its     

 

   corporate seal (or a facsimile thereof) to be hereto affixed and attested by the facsimile signature of its  Secretary or an Assistant Secretary.   Dated:                                       POTOMAC ELECTRIC POWER COMPANY                                       By                                                                                 Donna J. Kinzel, Senior Vice President, Chief                                         Financial Officer and Treasurer   Attest:                                   Assistant Secretary                            [FORM OF TRUSTEE’S CERTIFICATE]               This Bond is one of the Bonds, of the series designated therein, described in the within- mentioned Amended Indenture and the Supplemental Indenture dated as of June 1, 2018.               Dated:                        The Bank of New York Mellon, as Trustee.                                             By                                                                                        Authorized Signatory              [TEXT APPEARING ON REVERSE SIDE OF BOND OF 4.27% SERIES]               This Bond is one of a duly authorized issue of Bonds of the Company (hereinafter called  the “Bonds”) in unlimited aggregate principal amount, of the series hereinafter specified, all issued and to  be issued under and equally secured (except in so far as any purchase or sinking fund or analogous  provisions for any particular series of Bonds, established by any indenture supplemental to the Amended  Indenture hereinafter mentioned, may afford additional security for such Bonds) by a mortgage and deed  of trust, dated July 1, 1936, executed by the Company to The Bank of New York Mellon as successor to  The Riggs National Bank of Washington, D.C. (herein called the “Trustee”), as trustee, as amended by  indentures supplemental thereto dated December 10, 1939, August 10, 1942, October 15, 1942, April 1,  1966, June 16, 1981, June 17, 1981, December 1, 1981, August 1, 1982, October 1, 1982, April 15, 1983,  November 1, 1985, March 1, 1986, November 1, 1986, March 1, 1987, September 16, 1987, May 1, 1989,  August 1, 1989, April 5, 1990, May 21, 1991, May 7, 1992, September 1, 1992, November 1, 1992,  March 1, 1993, March 2, 1993, July 1, 1993, August 20, 1993, September 29, 1993, September 30, 1993,  October 1, 1993, February 10, 1994, February 11, 1994, March 10, 1995, September 6, 1995, September  7, 1995, October 2, 1997, March 17, 1999, November 17, 2003, March 16, 2004, May 24, 2005, April 1,  2006, November 13, 2007, March 24, 2008, December 3, 2008, March 28, 2012, March 11, 2013,  November 14, 2013, March 11, 2014, March 9, 2015 and May 15, 2017, (said mortgage and deed of trust,  as so amended, being herein called the “Amended Indenture”) and all indentures supplemental thereto, to                                         2    

 

   which Amended Indenture and supplemental indentures reference is hereby made for a description of the  properties mortgaged and pledged, the nature and extent of the security, the rights of the owners of the  Bonds and of the Trustee in respect thereto, and the terms and conditions upon which the Bonds are, and  are to be, secured. To the extent permitted by, and as provided in, the Amended Indenture, modifications  or alterations of the Amended Indenture, or of any indenture supplemental thereto, and of the rights and  obligations of the Company and of the holders of the Bonds may be made with the consent of the  Company by an affirmative vote of not less than 60% in amount of the Bonds entitled to vote then  outstanding, at a meeting of Bondholders called and held as provided in the Amended Indenture, and by  an affirmative vote of not less than 60% in amount of the Bonds of any series entitled to vote then  outstanding and affected by such modification or alteration, in case one or more but less than all of the  series of Bonds then outstanding under the Amended Indenture are so affected; provided, however, that  no such modification or alteration shall be made which will affect the terms of payment of the principal  of, or interest on, this Bond, which are unconditional, or which reduces the percentage of Bonds the  affirmative vote of which is required for the making of such modifications or alterations.               This Bond is one of a series designated as the “First Mortgage Bonds, 4.27% Series due  June 15, 2048” (herein called the “Bonds of 4.27% Series”) of the Company, issued under and secured by  the Amended Indenture and all indentures supplemental thereto and described in the supplemental  indenture, dated as of June 1, 2018 between the Company and the Trustee, supplemental to the Amended  Indenture.               The Bonds of 4.27% Series shall be redeemable at the option of the Company prior to the  express date of the maturity hereof, in whole or in part, at any time; provided that the Company may not  redeem less than 5% of the aggregate principal amount of the Bonds of 4.27% Series in the case of any  partial redemption. The Company shall give notice of its intent to redeem such Bonds to the holders of  such Bonds of 4.27% Series at least 30 days but no more than 60 days prior to the date fixed for such  redemption (the “Redemption Date”). If the Company redeems all or any part of the Bonds of 4.27%  Series pursuant to the provisions of this paragraph, it shall pay an amount equal to 100% of the principal  amount of the Bonds of 4.27% Series to be redeemed and a Make-Whole Amount, which shall be  calculated as follows:         “Make-Whole Amount” means, as determined by the Company, with respect to any Bond of the  4.27% Series, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled  Payments with respect to the Called Principal of such Bond of the 4.27% Series over the amount of such  Called Principal of such Bond of the 4.27% Series, provided, that the Make-Whole Amount may in no  event be less than zero.  For the purposes of determining the Make-Whole Amount, the following terms  have the following meanings:            “Business Day” means any day other than a Saturday, a Sunday or a day on which           commercial banks in New York City are required or authorized to be closed.            “Called Principal” means, with respect to any Bond of the 4.27% Series, the principal of such           Bond of the 4.27% Series that is to be redeemed or has become or is declared to be           immediately due and payable pursuant to the Amended Indenture.            “Discounted Value” means, with respect to the Called Principal of any Bond of the 4.27%           Series, the amount obtained by discounting all Remaining Scheduled Payments with respect                                         3    

 

                to such Called Principal from their respective scheduled due dates to the Settlement Date with  respect to such Called Principal, in accordance with accepted financial practice and at a  discount factor (applied on the same periodic basis as that on which interest on the Bonds of  4.27% Series is payable) equal to the Reinvestment Yield with respect to such Called  Principal.   “Reinvestment Yield” means, with respect to the Called Principal of any Bond of the 4.27%  Series, the sum of (a) 0.50% plus (b) the yield to maturity implied by the “Ask Yield(s)”  reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the  Settlement Date with respect to such Called Principal, on the display designated as “Page  PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for  the most recently issued actively traded on-the-run U.S. Treasury securities (“Reported”)  having a maturity equal to the Remaining Average Life of such Called Principal as of such  Settlement Date.  If there are no such U.S. Treasury securities Reported having a maturity  equal to such Remaining Average Life, then such implied yield to maturity will be  determined by (i) converting U.S. Treasury bill quotations to bond equivalent yields in  accordance with accepted financial practice and (ii) interpolating linearly between the “Ask  Yields” Reported for the applicable most recently issued actively traded on-the-run U.S.  Treasury securities with the maturities (1) closest to and greater than such Remaining  Average Life and (2) closest to and less than such Remaining Average Life.  The  Reinvestment Yield shall be rounded to the number of decimal places as appears in the  interest rate of the applicable Bond of the 4.27% Series.   If such yields are not Reported or the yields Reported as of such time are not ascertainable  (including by way of interpolation), then “Reinvestment Yield” means, with respect to the  Called Principal of any Bond of the 4.27% Series, the sum of (x) 0.50% plus (y) the yield to  maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for  which such yields have been so reported as of the second Business Day preceding the  Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release  H.15 (or any comparable successor publication) for the U.S. Treasury constant maturity  having a term equal to the Remaining Average Life of such Called Principal as of such  Settlement Date.  If there is no such U.S. Treasury constant maturity having a term equal to  such Remaining Average Life, such implied yield to maturity will be determined by  interpolating linearly between (1) the U.S. Treasury constant maturity so reported with the  term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury  constant maturity so reported with the term closest to and less than such Remaining Average  Life.  The Reinvestment Yield shall be rounded to the number of decimal places as appears in  the interest rate of the applicable Bond of the 4.27% Series.   “Remaining Average Life” means, with respect to any Called Principal, the number of years  obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by  multiplying (a) the principal component of each Remaining Scheduled Payment with respect  to such Called Principal by (b) the number of years, computed on the basis of a 360-day year  comprised of twelve 30-day months and calculated to two decimal places, that will elapse  between the Settlement Date with respect to such Called Principal and the scheduled due date  of such Remaining Scheduled Payment.   “Remaining Scheduled Payments” means, with respect to the Called Principal of any Bond of  the 4.27% Series, all payments of such Called Principal and interest thereon that would be  due after the Settlement Date with respect to such Called Principal if no payment of such  Called Principal were made prior to its scheduled due date, provided that if such Settlement                                4                 

 

            Date is not a date on which interest payments are due to be made under the Bond of the           4.27% Series, then the amount of the next succeeding scheduled interest payment will be           reduced by the amount of interest accrued to such Settlement Date and required to be paid on           such Settlement Date.            “Settlement Date” means, with respect to the Called Principal of any Bond of the 4.27%           Series, the date on which such Called Principal is to be prepaid or has become or is declared           to be immediately due and payable pursuant to the Amended Indenture, as the context           requires. The Company’s notice of redemption to the holders of Bonds of 4.27% Series shall           specify such date (which shall be a Business Day), the aggregate principal amount of the           Bonds of 4.27% Series to be prepaid on such date, the principal amount of each bond of           4.27% Series held by such holder to be prepaid (determined in accordance with the next           paragraph hereof), and the interest to be paid on the prepayment date with respect to such           principal amount being prepaid, and shall be accompanied by a certificate of the chief           financial officer, principal accounting officer, treasurer, assistant treasurer or comptroller of           the Company (each, a “Senior Financial Officer”) as to the estimated Make-Whole Amount           due in connection with such prepayment (calculated as if the date of such notice were the date           of the prepayment), setting forth the details of such computation.  Two Business Days prior to           such prepayment, the Company shall deliver to the Trustee and each holder of Bonds of           4.27% Series a certificate of a Senior Financial Officer specifying the calculation of such           Make-Whole Amount as of the specified prepayment date.               In the case of each partial prepayment of the Bonds of 4.27% Series, the principal amount  of the Bonds of 4.27% Series to be prepaid shall be allocated among all of the Bonds of 4.27% Series at  the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts  thereof not theretofore called for prepayment.               In the case of each prepayment of Bonds of 4.27% Series, the principal amount of each  bond of 4.27% Series to be prepaid shall mature and become due and payable on the date fixed for such  prepayment, together with interest on such principal amount accrued to such date and the applicable  Make-Whole Amount, if any.  From and after such date, unless the Company shall fail to pay such  principal amount when so due and payable, together with the interest and Make-Whole Amount, if any, as  aforesaid, interest on such principal amount shall cease to accrue.  Any bond of 4.27% Series paid or  prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no bond  of 4.27% Series shall be issued in lieu of any prepaid principal amount of any bond of 4.27% Series.               The Company shall deliver to the Trustee before any Redemption Date for the Bonds of  4.27% Series its calculation of the amount applicable to such redemption. The Trustee shall be under no  duty to inquire into, may presume the correctness of, and shall be fully protected in acting upon, the  Company’s calculation of any redemption price of the Bonds of 4.27% Series.               If at the time notice of redemption is given the redemption moneys are not on deposit  with the Trustee, then the redemption shall be subject to the receipt of such moneys on or before the  Redemption Date, and such notice shall be of no effect unless such moneys are received.               In case an event of default, as defined in the Amended Indenture, shall occur, the  principal of all the Bonds at any such time outstanding under the Amended Indenture may be declared or  may become due and payable, upon the conditions and in the manner and with the effect provided in the                                          5    

 

   Amended Indenture. The Amended Indenture 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 is transferable by the registered owner hereof, in person or by duly authorized  attorney, on the books of the Company to be kept for that purpose at the agency of the Company in the  Borough of Manhattan, The City of New York, upon surrender and cancellation of this Bond and on  presentation of a duly executed written instrument of transfer, and thereupon a new Bond or Bonds of the  same series, of the same aggregate principal amount and in authorized denominations will be issued to the  transferee or transferees in exchange therefor; and this Bond, with or without others of the same series,  may in like manner be exchanged for one or more new Bonds of the same series of other authorized  denominations but of the same aggregate principal amount; all subject to the terms and conditions set  forth in the Amended Indenture.               No recourse shall be had for the payment of the principal of, or the interest on, this Bond,  or for any claim based hereon or otherwise in respect hereof or of the Amended Indenture or any  indenture supplemental thereto, against any incorporator, or against any stockholder, director or officer,  past, present or future, of the Company or of any predecessor or successor corporation, either directly or  through the Company or any such predecessor or successor corporation, whether for amounts unpaid on  stock subscriptions or by virtue of any constitution, statute or rule of law, or by the enforcement of any  assessment or penalty or otherwise, all such liability, whether at common law, in equity, by any  constitution, statute or otherwise, of incorporators, stockholders, directors or officers being released by  every owner hereof by the acceptance of this Bond and as part of the consideration for the issue hereof,  and being likewise released by the terms of the Amended Indenture.                                                                                       6ex42

                                                                    Exhibit 4.2   Prepared by: Brian J. Buck          701 Ninth Street, N.W. - Mail Stop EP1300  Washington, D.C. 20068  Phone (202) 872-3364    Return to: Brian J. Buck  Assistant General Counsel and Assistant Secretary - Exelon Corporation  701 Ninth Street, N.W. - Mail Stop EP1300  Washington, D.C. 20068  Phone (202) 872-3364                         POTOMAC ELECTRIC POWER COMPANY                          701 Ninth Street, N.W., Washington, D.C.                                        TO                          THE BANK OF NEW YORK MELLON                             101 Barclay Street, New York, NY                                      as Trustee                                 Supplemental Indenture                                Dated as of June 1, 2018                         Supplemental to Mortgage and Deed of Trust                                   Dated July 1, 1936                FIRST MORTGAGE BONDS, 4.27% SERIES DUE JUNE 15, 2048              FIRST MORTGAGE BONDS, 4.31% SERIES DUE NOVEMBER 1, 2048                                 

 

                                TABLE OF CONTENTS                                                                            Page   PART I. DESCRIPTION OF BONDS OF 4.27% SERIES DUE JUNE 15, 2048......................... 4  PART II. DESCRIPTION OF BONDS OF 4.31% SERIES DUE NOVEMBER 1, 2048........... 12  PART III. ISSUE OF BONDS...................................................................................................... 19  PART IV. REDEMPTION AND CANCELLATION OF BONDS. ............................................ 20  PART V. ADDITIONAL PARTICULAR COVENANTS OF THE COMPANY. ..................... 21  PART VI. AMENDMENT OF INDENTURE TO PERMIT QUALIFICATION UNDER            THE TRUST INDENTURE ACT. .......................................................................... 21  PART VII. THE TRUSTEE. ........................................................................................................ 21  PART VIII. MISCELLANEOUS PROVISIONS......................................................................... 22      *The Table of Contents is not part of the Supplemental Indenture and should not be considered as such. It  is included herein only for purposes of convenient reference.                                                    

 

               SUPPLEMENTAL INDENTURE, dated as of June 1, 2018, made by and between  Potomac Electric Power Company, a corporation organized and existing under the laws of the District of  Columbia and a domestic corporation of the Commonwealth of Virginia (hereinafter sometimes called the  “Company”), party of the first part, and The Bank of New York Mellon, a banking corporation organized  and existing under the laws of the State of New York (hereinafter sometimes called the “Trustee”), as  trustee under the Mortgage and Deed of Trust dated July 1, 1936, hereinafter mentioned, party of the  second part;               WHEREAS, the Company has heretofore executed and delivered its Mortgage and Deed  of Trust, dated July 1, 1936 (hereinafter sometimes referred to as the “Original Indenture”), to The Riggs  National Bank of Washington, D.C., as trustee, to secure an issue of First Mortgage Bonds of the  Company, issuable in series; and               WHEREAS, the Trustee has succeeded The Riggs National Bank of Washington, D.C. as  trustee under the Original Indenture pursuant to Article XIII, Section 3 thereof; and               WHEREAS, pursuant to the terms and provisions of the Original Indenture, indentures  supplemental thereto dated as of July 1, 1936, December 1, 1939, August 1, 1940, August 1, 1942,  January 1, 1948, May 1, 1949, May 1, 1950, March 1, 1952, May 15, 1953, May 16, 1955, June 1, 1956,  December 1, 1958, November 16, 1959, December 1, 1960, February 15, 1963, May 15, 1964, April 1,  1966, May 1, 1967, February 15, 1968, March 15, 1969, February 15, 1970, August 15, 1970, September  15, 1972, April 1, 1973, January 2, 1974, August 15, 1974, August 15, 1974, June 15, 1977, July 1, 1979,  June 16, 1981, June 17, 1981, December 1, 1981, August 1, 1982, October 1, 1982, April 15, 1983,  November 1, 1985, March 1, 1986, November 1, 1986, March 1, 1987, September 16, 1987, May 1, 1989,  August 1, 1989, April 5, 1990, May 21, 1991, May 7, 1992, September 1, 1992, November 1, 1992,  March 1, 1993, March 2, 1993, July 1, 1993, August 20, 1993, September 29, 1993, September 30, 1993,  October 1, 1993, February 10, 1994, February 11, 1994, March 10, 1995, September 6, 1995, September  7, 1995, October 2, 1997, March 17, 1999, November 17, 2003, March 16, 2004, May 24, 2005, April 1,  2006, November 13, 2007, March 24, 2008, December 3, 2008, March 28, 2012, March 11, 2013,  November 14, 2013, March 11, 2014, March 9, 2015 and May 15, 2017, have been heretofore entered  into between the Company and the Trustee to provide, respectively, for the creation of the first through  the seventy-fifth series of Bonds thereunder and, in the case of the supplemental indentures dated January  1, 1948, March 1, 1952, May 15, 1953, May 16, 1955, June 1, 1956, September 15, 1972, July 1, 1979,  June 17, 1981, November 1, 1985, September 16, 1987, May 1, 1989, May 21, 1991, May 7, 1992, July 1,  1993, October 2, 1997, December 19, 2014, December 5, 2017 and one of the supplemental indentures  dated August 15, 1974, to convey additional property; and               WHEREAS, $20,000,000 principal amount of Bonds of the 3-1/4% Series due 1966 (the  first series), $5,000,000 principal amount of Bonds of the 3-1/4% Series due 1974 (the second series),  $10,000,000 principal amount of Bonds of the 3-1/4% Series due 1975 (the third series), $5,000,000  principal amount of Bonds of the 3-1/4% Series due 1977 (the fourth series), $15,000,000 principal  amount of Bonds of the 3% Series due 1983 (the fifth series), $10,000,000 principal amount of Bonds of  the 2-7/8% Series due 1984 (the sixth series), $30,000,000 principal amount of Bonds of the 2-3/4%  Series due 1985 (the seventh series), $15,000,000 principal amount of Bonds of the 3-1/4% Series due  1987 (the eighth series), $10,000,000 principal amount of Bonds of the 3-7/8% Series due 1988 (the ninth     

 

   series), $10,000,000 principal amount of Bonds of the 3-3/8% Series due 1990 (the tenth series),  $10,000,000 principal amount of Bonds of the 3-5/8% Series due 1991 (the eleventh series), $25,000,000  principal amount of Bonds of the 4-5/8% Series due 1993 (the twelfth series), $15,000,000 principal  amount of Bonds of the 5-1/4% Series due 1994 (the thirteenth series), $40,000,000 principal amount of  Bonds of the 5% Series due 1995 (the fourteenth series), $50,000,000 principal amount of Bonds of the  4¬3/8% Series due 1998 (the fifteenth series), $45,000,000 principal amount of Bonds of the 4-1/2%  Series due 1999 (the sixteenth series), $15,000,000 principal amount of Bonds of the 5-1/8% Series due  2001 (the seventeenth series), $35,000,000 principal amount of Bonds of the 5-7/8% Series due 2002 (the  eighteenth series), $40,000,000 principal amount of Bonds of the 6-5/8% Series due 2003 (the nineteenth  series), $45,000,000 principal amount of Bonds of the 7-3/4% Series due 2004 (the twentieth series),  $35,000,000 principal amount of Bonds of the 8.85% Series due 2005 (the twenty-first series),  $70,000,000 principal amount of Bonds of the 9-1/2% Series due August 15, 2005 (the twenty-second  series), $50,000,000 principal amount of Bonds of the 7-3/4% Series due 2007 (the twenty-third series),  $25,000,000 principal amount of Bonds of the 5-5/8% Series due 1997 (the twenty-fourth series),  $100,000,000 principal amount of Bonds of the 8-3/8% Series due 2009 (the twenty-fifth series),  $50,000,000 principal amount of Bonds of the 10-1/4% Series due 1981 (the twenty-sixth series),  $50,000,000 principal amount of Bonds of the 10-3/4% Series due 2004 (the twenty-seventh series),  $38,300,000 principal amount of Bonds of the 6-1/8% Series due 2007 (the twenty-eighth series),  $15,000,000 principal amount of Bonds of the 6-1/2% Series due 2004 (the twenty-ninth series),  $20,000,000 principal amount of Bonds of the 6-1/2% Series due 2007 (the thirtieth series), $7,500,000  principal amount of Bonds of the 6-5/8% Series due 2009 (the thirty-first series), $30,000,000 principal  amount of Bonds of the Floating Rate Series due 2010 (the thirty-second series), $50,000,000 principal  amount of Bonds of the 14-1/2% Series due 1991 (the thirty-third series), $50,000,000 principal amount  of Bonds of the Adjustable Rate Series due 2001 (the thirty-fourth series), $60,000,000 principal amount  of Bonds of the 14-1/4% Series due 1992 (the thirty-fifth series), $50,000,000 principal amount of Bonds  of the 11-7/8% Series due 1989 (the thirty-sixth series), $37,000,000 principal amount of Bonds of the 8- 3/4% Series due 2010 (the thirty-seventh series), $75,000,000 principal amount of Bonds of the 11-1/4%  Series due 2015 (the thirty-eighth series), $75,000,000 principal amount of Bonds of the 9-1/4% Series  due 2016 (the thirty-ninth series), $75,000,000 principal amount of Bonds of the 8-3/4% Series due 2016  (the fortieth series), $75,000,000 principal amount of Bonds of the 8-1/4% Series due 2017 (the forty-first  series), $75,000,000 principal amount of Bonds of the 9% Series due 1990 (the forty-second series),  $75,000,000 principal amount of Bonds of the 9-3/4% Series due 2019 (the forty-third series),  $75,000,000 principal amount of Bonds of the 8-5/8% Series due 2019 (the forty-fourth series),  $100,000,000 principal amount of Bonds of the 9% Series due 2000 (the forty-fifth series), $100,000,000  principal amount of Bonds of the 9% Series due 2021 (the forty-sixth series), $75,000,000 principal  amount of Bonds of the 8-1/2% Series due 2027 (the forty-seventh series); $30,000,000 principal amount  of Bonds of the 6% Series due 2022 (the forty-eighth series); $37,000,000 principal amount of Bonds of  the 6-3/8% Series due 2023 (the forty-ninth series); $78,000,000 principal amount of Bonds of the 6-1/2%  Series due 2008 (the fiftieth series); $40,000,000 principal amount of Bonds of the 7-1/2% Series due  2028 (the fifty-first series); $100,000,000 principal amount of Bonds of the 7-1/4% Series due 2023 (the  fifty-second series); $100,000,000 principal amount of Bonds of the 6-7/8% Series due 2023 (the fifty- third series); $50,000,000 principal amount of Bonds of the 5-5/8% Series due 2003 (the fifty-fourth  series); $50,000,000 principal amount of Bonds of the 5-7/8% Series due 2008 (the fifty-fifth series);  $75,000,000 principal amount of Bonds of the 6-7/8% Series due 2024 (the fifty-sixth series);                                         2    

 

   $42,500,000 principal amount of Bonds of the 5-3/8% Series due 2024 (the fifty-seventh series);  $38,300,000 principal amount of Bonds of the 5-3/8% Series due 2024 (the fifty-eighth series);  $16,000,000 principal amount of Bonds of the 5-3/4% Series due 2010 (the fifty-ninth series);  $100,000,000 principal amount of Bonds of the 6-1/2% series due 2005 (the sixtieth series); $75,000,000  principal amount of Bonds of the 7-3/8% Series due 2025 (the sixty-first series); $175,000,000 principal  amount of Bonds of the 6-1/4% Series due 2007 (the sixty-second series); $270,000,000 principal amount  of Bonds of the 6% Series due 2004 (the sixty-third series); $200,000,000 principal amount of Bonds of  the 4.95% Series due 2013 (the sixty-fourth series); and $175,000,000 principal amount of Bonds of the  4.65% Series due 2014 (the sixty-fifth series) have been heretofore redeemed and retired and there are  now issued and outstanding under the Original Indenture and under the supplemental indentures referred  to above: $100,000,000 principal amount of Bonds of the 5.75% Series due 2034 (the sixty-sixth series);  $175,000,000 principal amount of Bonds of the 5.40% Series due 2035 (the sixty-seventh series);  $109,500,000 principal amount of Bonds of the Medco Collateral Series due 2022 (the sixty-eighth  series); $250,000,000 principal amount of Bonds of the 6.50% Series due 2037 (the sixty-ninth series);  $250,000,000 principal amount of Bonds of the 6.50% Series 2 due 2037 (the seventieth series);  $250,000,000 principal amount of Bonds of the 7.90% Series due 2038 (the seventy-first series);  $200,000,000 principal amount of Bonds of the 3.05% Series due 2022 (the seventy-second series);  $650,000,000 principal amount of Bonds of the 4.15% Series due 2043 (the seventy-third series);  $150,000,000 principal amount of Bonds of the 4.95% Series due 2043 (the seventy-fourth series); and  $400,000,000 principal amount of Bonds of the 3.60% Series due 2024 (the seventy-fifth series); and               WHEREAS, for the purpose of conforming the Original Indenture to the standards  prescribed by the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”), or otherwise  modifying certain of the provisions of the Original Indenture, indentures supplemental thereto dated  December 10, 1939, August 10, 1942, October 15, 1942, April 1, 1966, June 16, 1981, June 17, 1981,  December 1, 1981, August 1, 1982, October 1, 1982, April 15, 1983, November 1, 1985, March 1, 1986,  November 1, 1986, March 1, 1987, September 16, 1987, May 1, 1989, August 1, 1989, April 5, 1990,  May 21, 1991, May 7, 1992, September 1, 1992, November 1, 1992, March 1, 1993, March 2, 1993, July  1, 1993, August 20, 1993, September 29, 1993, September 30, 1993, October 1, 1993, February 10, 1994,  February 11, 1994, March 10, 1995, September 6, 1995, September 7, 1995, October 2, 1997, March 17,  1999, November 17, 2003 and December 5, 2017 have been heretofore entered into between the  Company and the Trustee, and for the purpose of conveying additional property, indentures supplemental  thereto dated July 15, 1942, October 15, 1947, December 31, 1948, December 31, 1949, February 15,  1951, February 16, 1953, March 15, 1954, March 15, 1955, March 15, 1956, April 1, 1957, May 1, 1958,  May 1, 1959, May 2, 1960, April 3, 1961, May 1, 1962, May 1, 1963, April 23, 1964, May 3, 1965, June  1, 1966, April 28, 1967, July 3, 1967, May 1, 1968, June 16, 1969, May 15, 1970, September 1, 1971,  June 17, 1981, November 1, 1985, September 16, 1987, May 1, 1989, May 21, 1991, May 7, 1992, July 1,  1993, October 2, 1997, December 19, 2014 and December 5, 2017 have been heretofore entered into  between the Company and the Trustee, and for the purpose of better securing and protecting the Bonds  then or thereafter issued and confirming the lien of the Original Indenture, an indenture dated October 15,  1942 supplemental thereto has been heretofore entered into between the Company and the Trustee; the  Original Indenture as heretofore amended and supplemented being hereinafter referred to as the “Original  Indenture as amended”; and                                          3    

 

               WHEREAS, the Company is entitled to have authenticated and delivered additional  Bonds in substitution for refundable Bonds, upon compliance with the provisions of Section 7 of Article  III of the Original Indenture as amended; and               WHEREAS, the Company has determined to issue (i) a seventy-sixth series of Bonds  under the Original Indenture as amended, to be known as First Mortgage Bonds, 4.27% Series due June  15, 2048 (hereinafter called “Bonds of 4.27% Series”) and (ii) a seventy-seventh series of Bonds under  the Original Indenture as amended, to be known as First Mortgage Bonds, 4.31% Series due November 1,  2048 (hereinafter called “Bonds of 4.31% Series”); and               WHEREAS, the Company, in the exercise of the powers and authority conferred upon  and reserved to it under the provisions of the Original Indenture as amended and pursuant to appropriate  resolutions of its Board of Directors, has duly resolved and determined to make, execute and deliver to  the Trustee a supplemental indenture in the form hereof for the purposes herein provided; and               WHEREAS, all conditions and requirements necessary to make this Supplemental  Indenture a valid, binding and legal instrument have been done, performed and fulfilled, and the  execution and delivery hereof have been in all respects duly authorized;                 NOW, THEREFORE, THIS INDENTURE WITNESSETH:               That Potomac Electric Power 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, and for other  valuable considerations, the receipt whereof is hereby acknowledged, hereby covenants, declares and  agrees with the Trustee and its successors in the trust under the Original Indenture as amended for the  benefit of those who hold the Bonds and coupons, or any of them, issued or to be issued hereunder or  under the Original Indenture as amended, as follows:                                      PART I.              DESCRIPTION OF BONDS OF 4.27% SERIES DUE JUNE 15, 2048.               SECTION 1. The Bonds of 4.27% Series shall, subject to the provisions of Section 1 of  Article II of the Original Indenture as amended, be designated as “First Mortgage Bonds, 4.27% Series  due June 15, 2048” of the Company. The Bonds of 4.27% Series shall be executed, authenticated and  delivered in accordance with the provisions of, and shall in all respects be subject to, all of the terms,  conditions and covenants of the Original Indenture as amended, except in so far as the terms and  provisions of the Original Indenture as amended are amended or modified by this Supplemental  Indenture.               The Bonds of 4.27% Series shall mature June 15, 2048, and shall bear interest from the  date of initial issuance at the rate of four and twenty-seven hundredths percent (4.27%) per annum,  payable semiannually, commencing December 15, 2018, on the fifteenth day of June and the fifteenth day  of December in each year (each such June 15th and December 15th being hereinafter called an “interest  payment date”). The Bonds of 4.27% Series shall be payable as to principal and interest in lawful money                                         4    

 

   of the United States of America, and shall be payable (as well the interest as the principal thereof) at the  agency of the Company in the Borough of Manhattan, The City of New York.               The interest so payable on any interest payment date shall be paid to the persons in whose  names the Bonds of 4.27% Series are registered at the close of business on the first calendar day of the  month in which the interest payment date occurs; provided, that interest payable on the maturity date shall  be paid to the person to whom principal shall be payable; and provided further that if the Company shall  default in the payment of any interest due on such interest payment date, such defaulted interest shall be  paid to the persons in whose names the Bonds of 4.27% Series are registered on the date of payment of  such defaulted interest, or in accordance with the regulations of any securities exchange on which the  Bonds of 4.27% Series are listed. Interest shall be computed on the basis of a 360-day year comprised of  twelve 30-day months.               Except as provided hereinafter, every Bond of 4.27% Series shall be dated as of the date  of its authentication and delivery, or if that is an interest payment date, the next day, and shall bear  interest from the interest payment date next preceding its date or the date of delivery of the initial Bonds  of 4.27% Series, whichever is later. Notwithstanding Section 6 of Article II of the Original Indenture as  amended, any Bond of 4.27% Series authenticated and delivered by the Trustee after the close of business  on the record date with respect to any interest payment date and prior to such interest payment date shall  be dated as of the date next following such interest payment date and shall bear interest from such interest  payment date; except that if the Company shall default in the payment of any interest due on such interest  payment date, such Bond shall bear interest from the next preceding interest payment date or the date of  delivery of the initial Bonds of 4.27% Series, whichever is later.               SECTION 2. The Bonds of 4.27% Series, and the Trustee’s certificate to be endorsed on  the Bonds of 4.27% Series, shall be substantially in the following forms, respectively:                       [FORM OF FACE OF BOND OF 4.27% SERIES]   [THIS BOND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS  AMENDED, OR THE SECURITIES OR “BLUE SKY” LAWS OF ANY OTHER JURISDICTION,  AND MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH SUCH REGISTRATION  REQUIREMENTS OR UNDER AN EXEMPTION THEREFROM.]                          POTOMAC ELECTRIC POWER COMPANY                       (A District of Columbia and Virginia corporation)                      First Mortgage Bond, 4.27% Series due June 15, 2048   No. [______]                                                       $[_________]                                                                  PPN No. [______]               POTOMAC ELECTRIC POWER COMPANY, a corporation organized and existing  under the laws of the District of Columbia and a domestic corporation of the Commonwealth of Virginia                                         5    

 

   (hereinafter called the “Company”, which term shall include any successor corporation as defined in the  Amended Indenture hereinafter referred to), for value received, hereby promises to pay to [________] or  registered assigns, the sum of [__________] Dollars ($[_______]), on the fifteenth day of June, 2048, in  lawful money of the United States of America, and to pay interest thereon in like money from the later of  the date of delivery of the initial Bonds of 4.27% Series or the June 15th or December 15th next  preceding the date of this Bond, or if the Company shall default in the payment of interest due on such  interest payment date, then from the next preceding interest payment date or the date of delivery of the  initial Bonds of 4.27% Series, whichever is later, at the rate of four and twenty-seven hundredths percent  (4.27%) per annum, payable semiannually, commencing December 15, 2018, on the fifteenth day of June  or December in each year until maturity, or, if the Company shall default in the payment of the principal  hereof, until the Company’s obligation with respect to the payment of such principal shall be discharged  as provided in the Amended Indenture. The interest so payable on any June 15th or December 15th will,  subject to certain exceptions provided in the indenture dated as of June 1, 2018 supplemental to the  Amended Indenture, be paid to the person in whose name this Bond is registered at the close of business  on the first calendar day of the month in which the interest payment date occurs. Both principal of, and  interest on, this Bond are payable at the agency of the Company in the Borough of Manhattan, The City  of New York.               Reference is made to the further provisions of this Bond set forth on the reverse hereof,  and such further provisions shall for all purposes have the same effect as though fully set forth at this  place.               This Bond shall not be entitled to any benefit under the Amended Indenture or any  indenture supplemental thereto, or become valid or obligatory for any purpose, until The Bank of New  York Mellon, the Trustee under the Amended Indenture, or a successor trustee thereto under the  Amended Indenture, shall have signed the form of certificate endorsed hereon.               IN WITNESS WHEREOF, Potomac Electric Power Company has caused this Bond to be  signed in its name by the signature (or a facsimile thereof) of its President or a Vice President, and its  corporate seal (or a facsimile thereof) to be hereto affixed and attested by the facsimile signature of its  Secretary or an Assistant Secretary.   Dated:                                       POTOMAC ELECTRIC POWER COMPANY                                       By                                                                                 Donna J. Kinzel, Senior Vice President, Chief                                         Financial Officer and Treasurer   Attest:                                   Assistant Secretary                                            6    

 

                          [FORM OF TRUSTEE’S CERTIFICATE]               This Bond is one of the Bonds, of the series designated therein, described in the within- mentioned Amended Indenture and the Supplemental Indenture dated as of June 1, 2018.               Dated:                        The Bank of New York Mellon, as Trustee.                                             By                                                                                        Authorized Signatory              [TEXT APPEARING ON REVERSE SIDE OF BOND OF 4.27% SERIES]               This Bond is one of a duly authorized issue of Bonds of the Company (hereinafter called  the “Bonds”) in unlimited aggregate principal amount, of the series hereinafter specified, all issued and to  be issued under and equally secured (except in so far as any purchase or sinking fund or analogous  provisions for any particular series of Bonds, established by any indenture supplemental to the Amended  Indenture hereinafter mentioned, may afford additional security for such Bonds) by a mortgage and deed  of trust, dated July 1, 1936, executed by the Company to The Bank of New York Mellon as successor to  The Riggs National Bank of Washington, D.C. (herein called the “Trustee”), as trustee, as amended by  indentures supplemental thereto dated December 10, 1939, August 10, 1942, October 15, 1942, April 1,  1966, June 16, 1981, June 17, 1981, December 1, 1981, August 1, 1982, October 1, 1982, April 15, 1983,  November 1, 1985, March 1, 1986, November 1, 1986, March 1, 1987, September 16, 1987, May 1, 1989,  August 1, 1989, April 5, 1990, May 21, 1991, May 7, 1992, September 1, 1992, November 1, 1992,  March 1, 1993, March 2, 1993, July 1, 1993, August 20, 1993, September 29, 1993, September 30, 1993,  October 1, 1993, February 10, 1994, February 11, 1994, March 10, 1995, September 6, 1995, September  7, 1995, October 2, 1997, March 17, 1999, November 17, 2003, March 16, 2004, May 24, 2005, April 1,  2006, November 13, 2007, March 24, 2008, December 3, 2008, March 28, 2012, March 11, 2013,  November 14, 2013, March 11, 2014, March 9, 2015 and May 15, 2017, (said mortgage and deed of trust,  as so amended, being herein called the “Amended Indenture”) and all indentures supplemental thereto, to  which Amended Indenture and supplemental indentures reference is hereby made for a description of the  properties mortgaged and pledged, the nature and extent of the security, the rights of the owners of the  Bonds and of the Trustee in respect thereto, and the terms and conditions upon which the Bonds are, and  are to be, secured. To the extent permitted by, and as provided in, the Amended Indenture, modifications  or alterations of the Amended Indenture, or of any indenture supplemental thereto, and of the rights and  obligations of the Company and of the holders of the Bonds may be made with the consent of the  Company by an affirmative vote of not less than 60% in amount of the Bonds entitled to vote then  outstanding, at a meeting of Bondholders called and held as provided in the Amended Indenture, and by  an affirmative vote of not less than 60% in amount of the Bonds of any series entitled to vote then  outstanding and affected by such modification or alteration, in case one or more but less than all of the  series of Bonds then outstanding under the Amended Indenture are so affected; provided, however, that  no such modification or alteration shall be made which will affect the terms of payment of the principal  of, or interest on, this Bond, which are unconditional, or which reduces the percentage of Bonds the  affirmative vote of which is required for the making of such modifications or alterations.                                          7    

 

               This Bond is one of a series designated as the “First Mortgage Bonds, 4.27% Series due  June 15, 2048” (herein called the “Bonds of 4.27% Series”) of the Company, issued under and secured by  the Amended Indenture and all indentures supplemental thereto and described in the supplemental  indenture, dated as of June 1, 2018 between the Company and the Trustee, supplemental to the Amended  Indenture.               The Bonds of 4.27% Series shall be redeemable at the option of the Company prior to the  express date of the maturity hereof, in whole or in part, at any time; provided that the Company may not  redeem less than 5% of the aggregate principal amount of the Bonds of 4.27% Series in the case of any  partial redemption. The Company shall give notice of its intent to redeem such Bonds to the holders of  such Bonds of 4.27% Series at least 30 days but no more than 60 days prior to the date fixed for such  redemption (the “Redemption Date”). If the Company redeems all or any part of the Bonds of 4.27%  Series pursuant to the provisions of this paragraph, it shall pay an amount equal to 100% of the principal  amount of the Bonds of 4.27% Series to be redeemed and a Make-Whole Amount, which shall be  calculated as follows:         “Make-Whole Amount” means, as determined by the Company, with respect to any Bond of the  4.27% Series, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled  Payments with respect to the Called Principal of such Bond of the 4.27% Series over the amount of such  Called Principal of such Bond of the 4.27% Series, provided, that the Make-Whole Amount may in no  event be less than zero.  For the purposes of determining the Make-Whole Amount, the following terms  have the following meanings:            “Business Day” means any day other than a Saturday, a Sunday or a day on which           commercial banks in New York City are required or authorized to be closed.            “Called Principal” means, with respect to any Bond of the 4.27% Series, the principal of such           Bond of the 4.27% Series that is to be redeemed or has become or is declared to be           immediately due and payable pursuant to the Amended Indenture.            “Discounted Value” means, with respect to the Called Principal of any Bond of the 4.27%           Series, the amount obtained by discounting all Remaining Scheduled Payments with respect           to such Called Principal from their respective scheduled due dates to the Settlement Date with           respect to such Called Principal, in accordance with accepted financial practice and at a           discount factor (applied on the same periodic basis as that on which interest on the Bonds of           4.27% Series is payable) equal to the Reinvestment Yield with respect to such Called           Principal.            “Reinvestment Yield” means, with respect to the Called Principal of any Bond of the 4.27%           Series, the sum of (a) 0.50% plus (b) the yield to maturity implied by the “Ask Yield(s)”           reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the           Settlement Date with respect to such Called Principal, on the display designated as “Page           PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for           the most recently issued actively traded on-the-run U.S. Treasury securities (“Reported”)           having a maturity equal to the Remaining Average Life of such Called Principal as of such           Settlement Date.  If there are no such U.S. Treasury securities Reported having a maturity           equal to such Remaining Average Life, then such implied yield to maturity will be           determined by (i) converting U.S. Treasury bill quotations to bond equivalent yields in           accordance with accepted financial practice and (ii) interpolating linearly between the “Ask                                         8    

 

                Yields” Reported for the applicable most recently issued actively traded on-the-run U.S.  Treasury securities with the maturities (1) closest to and greater than such Remaining  Average Life and (2) closest to and less than such Remaining Average Life.  The  Reinvestment Yield shall be rounded to the number of decimal places as appears in the  interest rate of the applicable Bond of the 4.27% Series.   If such yields are not Reported or the yields Reported as of such time are not ascertainable  (including by way of interpolation), then “Reinvestment Yield” means, with respect to the  Called Principal of any Bond of the 4.27% Series, the sum of (x) 0.50% plus (y) the yield to  maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for  which such yields have been so reported as of the second Business Day preceding the  Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release  H.15 (or any comparable successor publication) for the U.S. Treasury constant maturity  having a term equal to the Remaining Average Life of such Called Principal as of such  Settlement Date.  If there is no such U.S. Treasury constant maturity having a term equal to  such Remaining Average Life, such implied yield to maturity will be determined by  interpolating linearly between (1) the U.S. Treasury constant maturity so reported with the  term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury  constant maturity so reported with the term closest to and less than such Remaining Average  Life.  The Reinvestment Yield shall be rounded to the number of decimal places as appears in  the interest rate of the applicable Bond of the 4.27% Series.   “Remaining Average Life” means, with respect to any Called Principal, the number of years  obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by  multiplying (a) the principal component of each Remaining Scheduled Payment with respect  to such Called Principal by (b) the number of years, computed on the basis of a 360-day year  comprised of twelve 30-day months and calculated to two decimal places, that will elapse  between the Settlement Date with respect to such Called Principal and the scheduled due date  of such Remaining Scheduled Payment.   “Remaining Scheduled Payments” means, with respect to the Called Principal of any Bond of  the 4.27% Series, all payments of such Called Principal and interest thereon that would be  due after the Settlement Date with respect to such Called Principal if no payment of such  Called Principal were made prior to its scheduled due date, provided that if such Settlement  Date is not a date on which interest payments are due to be made under the Bond of the  4.27% Series, then the amount of the next succeeding scheduled interest payment will be  reduced by the amount of interest accrued to such Settlement Date and required to be paid on  such Settlement Date.   “Settlement Date” means, with respect to the Called Principal of any Bond of the 4.27%  Series, the date on which such Called Principal is to be prepaid or has become or is declared  to be immediately due and payable pursuant to the Amended Indenture, as the context  requires. The Company’s notice of redemption to the holders of Bonds of 4.27% Series shall  specify such date (which shall be a Business Day), the aggregate principal amount of the  Bonds of 4.27% Series to be prepaid on such date, the principal amount of each bond of  4.27% Series held by such holder to be prepaid (determined in accordance with the next  paragraph hereof), and the interest to be paid on the prepayment date with respect to such  principal amount being prepaid, and shall be accompanied by a certificate of the chief  financial officer, principal accounting officer, treasurer, assistant treasurer or comptroller of  the Company (each, a “Senior Financial Officer”) as to the estimated Make-Whole Amount  due in connection with such prepayment (calculated as if the date of such notice were the date                                9                 

 

            of the prepayment), setting forth the details of such computation.  Two Business Days prior to           such prepayment, the Company shall deliver to the Trustee and each holder of Bonds of           4.27% Series a certificate of a Senior Financial Officer specifying the calculation of such           Make-Whole Amount as of the specified prepayment date.               In the case of each partial prepayment of the Bonds of 4.27% Series, the principal amount  of the Bonds of 4.27% Series to be prepaid shall be allocated among all of the Bonds of 4.27% Series at  the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts  thereof not theretofore called for prepayment.               In the case of each prepayment of Bonds of 4.27% Series, the principal amount of each  bond of 4.27% Series to be prepaid shall mature and become due and payable on the date fixed for such  prepayment, together with interest on such principal amount accrued to such date and the applicable  Make-Whole Amount, if any.  From and after such date, unless the Company shall fail to pay such  principal amount when so due and payable, together with the interest and Make-Whole Amount, if any, as  aforesaid, interest on such principal amount shall cease to accrue.  Any bond of 4.27% Series paid or  prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no bond  of 4.27% Series shall be issued in lieu of any prepaid principal amount of any bond of 4.27% Series.               The Company shall deliver to the Trustee before any Redemption Date for the Bonds of  4.27% Series its calculation of the amount applicable to such redemption. The Trustee shall be under no  duty to inquire into, may presume the correctness of, and shall be fully protected in acting upon, the  Company’s calculation of any redemption price of the Bonds of 4.27% Series.               If at the time notice of redemption is given the redemption moneys are not on deposit  with the Trustee, then the redemption shall be subject to the receipt of such moneys on or before the  Redemption Date, and such notice shall be of no effect unless such moneys are received.               In case an event of default, as defined in the Amended Indenture, shall occur, the  principal of all the Bonds at any such time outstanding under the Amended Indenture may be declared or  may become due and payable, upon the conditions and in the manner and with the effect provided in the  Amended Indenture. The Amended Indenture 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 is transferable by the registered owner hereof, in person or by duly authorized  attorney, on the books of the Company to be kept for that purpose at the agency of the Company in the  Borough of Manhattan, The City of New York, upon surrender and cancellation of this Bond and on  presentation of a duly executed written instrument of transfer, and thereupon a new Bond or Bonds of the  same series, of the same aggregate principal amount and in authorized denominations will be issued to the  transferee or transferees in exchange therefor; and this Bond, with or without others of the same series,  may in like manner be exchanged for one or more new Bonds of the same series of other authorized  denominations but of the same aggregate principal amount; all subject to the terms and conditions set  forth in the Amended Indenture.               No recourse shall be had for the payment of the principal of, or the interest on, this Bond,  or for any claim based hereon or otherwise in respect hereof or of the Amended Indenture or any  indenture supplemental thereto, against any incorporator, or against any stockholder, director or officer,                                         10    

 

   past, present or future, of the Company or of any predecessor or successor corporation, either directly or  through the Company or any such predecessor or successor corporation, whether for amounts unpaid on  stock subscriptions or by virtue of any constitution, statute or rule of law, or by the enforcement of any  assessment or penalty or otherwise, all such liability, whether at common law, in equity, by any  constitution, statute or otherwise, of incorporators, stockholders, directors or officers being released by  every owner hereof by the acceptance of this Bond and as part of the consideration for the issue hereof,  and being likewise released by the terms of the Amended Indenture.                                   [END OF FORM]               SECTION 3. The Bonds of 4.27% Series shall be registered Bonds without coupons in  denominations of any multiple of $1,000, numbered consecutively upwards from R-1.                SECTION 4. The Bonds of 4.27% Series shall bear the following legend:   “THIS BOND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS  AMENDED, OR THE SECURITIES OR “BLUE SKY” LAWS OF ANY OTHER JURISDICTION,  AND MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH SUCH REGISTRATION  REQUIREMENTS OR UNDER AN EXEMPTION THEREFROM.”               SECTION 5. In addition to the events of default described in Article IX of the Indenture,  an event of default with respect to the Bonds of 4.27% Series will include the additional events of default  described in Section 11 of the Bond Purchase Agreement  between the Company and the initial holders of  the Bonds of 4.27% Series specified on Schedule A to the Bond Purchase Agreement.  The Trustee shall  not be deemed to have knowledge of any event of default under the Bond Purchase Agreement unless a  responsible officer of the Trustee shall have received written notice thereof from the Company or by the  holders of the Bonds of 4.27% Series then outstanding.               SECTION 6. In  order  to  enable  the  Trustee  to  comply  with  its  obligations  under  applicable tax laws, rules and regulations in effect from time to time (“Applicable Law”), the Company  shall provide to the Trustee, following written request from the Trustee, such information concerning the  holders of the Bonds of 4.27% Series as the Trustee may reasonably request in order to determine whether  the Trustee has any tax-related obligations under Applicable Law with respect to the payments made to  holders of the Bonds of 4.27% Series, but only to the extent (a) such information is in the Company’s  possession, (b) such information is not subject to any confidentiality or similar agreement or undertaking  or otherwise deemed by the Company to be confidential and (c) providing such information to the Trustee  does not, in the judgment of the Company, breach or violate or constitute a default under any applicable  laws, rules or regulations or any instrument or agreement to which the Company of any of its affiliates is  a party or may be bound. The Company, the Trustee or any paying agent for the Bonds of 4.27% Series  shall  be  permitted  to  make  any  withholding  or  deduction  from  the  amount  of  principal  and  interest  payable  to  holders  of  the Bonds  of  4.27%  Series  to  the  extent  required  under  Applicable  Law.  Each  holder of the Bonds  of 4.27% Series  by accepting such  bond shall be  deemed  to have  agreed that the  Company may provide to the Trustee such information concerning such holder as the Trustee may request  in  order  to  determine  whether the  Trustee  has  any  tax-related  obligations  under  Applicable  Law  with                                         11    

 

   respect to the payments made to such holder under this Supplemental Indenture; and such agreement by  each holder is part of the consideration for the issuance of the Bonds of 4.27% Series.               SECTION 7. Until Bonds of 4.27% Series in definitive form are ready for delivery, the  Company may execute, and upon its request in writing the Trustee shall authenticate and deliver, in lieu  thereof, Bonds for such series in temporary form, as provided in Section 9 of Article II of the Original  Indenture as amended.                                      PART II.            DESCRIPTION OF BONDS OF 4.31% SERIES DUE NOVEMBER 1, 2048.               SECTION 1. The Bonds of 4.31% Series shall, subject to the provisions of Section 1 of  Article II of the Original Indenture as amended, be designated as “First Mortgage Bonds, 4.31% Series  due November 1, 2048” of the Company. The Bonds of 4.31% Series shall be executed, authenticated and  delivered in accordance with the provisions of, and shall in all respects be subject to, all of the terms,  conditions and covenants of the Original Indenture as amended, except in so far as the terms and  provisions of the Original Indenture as amended are amended or modified by this Supplemental  Indenture.               The Bonds of 4.31% Series shall mature November 1, 2048, and shall bear interest from  the date of initial issuance at the rate of four and thirty-one hundredths percent (4.31%) per annum,  payable semiannually, commencing May 1, 2019, on the first day of May and the first day of November  in each year (each such May 1st and November 1st being hereinafter called an “interest payment date”).  The Bonds of 4.31% Series shall be payable as to principal and interest in lawful money of the United  States of America, and shall be payable (as well the interest as the principal thereof) at the agency of the  Company in the Borough of Manhattan, The City of New York.               The interest so payable on any interest payment date shall be paid to the persons in whose  names the Bonds of 4.31% Series are registered at the close of business on the first calendar day of the  month in which the interest payment date occurs; provided, that interest payable on the maturity date shall  be paid to the person to whom principal shall be payable; and provided further that if the Company shall  default in the payment of any interest due on such interest payment date, such defaulted interest shall be  paid to the persons in whose names the Bonds of 4.31% Series are registered on the date of payment of  such defaulted interest, or in accordance with the regulations of any securities exchange on which the  Bonds of 4.31% Series are listed. Interest shall be computed on the basis of a 360-day year comprised of  twelve 30-day months.               Except as provided hereinafter, every Bond of 4.31% Series shall be dated as of the date  of its authentication and delivery, or if that is an interest payment date, the next day, and shall bear  interest from the interest payment date next preceding its date or the date of delivery of the initial Bonds  of 4.31% Series, whichever is later. Notwithstanding Section 6 of Article II of the Original Indenture as  amended, any Bond of 4.31% Series authenticated and delivered by the Trustee after the close of business  on the record date with respect to any interest payment date and prior to such interest payment date shall  be dated as of the date next following such interest payment date and shall bear interest from such interest  payment date; except that if the Company shall default in the payment of any interest due on such interest                                         12    

 

   payment date, such Bond shall bear interest from the next preceding interest payment date or the date of  delivery of the initial Bonds of 4.31% Series, whichever is later.               SECTION 2. The Bonds of 4.31% Series, and the Trustee’s certificate to be endorsed on  the Bonds of 4.31% Series, shall be substantially in the following forms, respectively:                       [FORM OF FACE OF BOND OF 4.31% SERIES]   [THIS BOND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS  AMENDED, OR THE SECURITIES OR “BLUE SKY” LAWS OF ANY OTHER JURISDICTION,  AND MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH SUCH REGISTRATION  REQUIREMENTS OR UNDER AN EXEMPTION THEREFROM.]                          POTOMAC ELECTRIC POWER COMPANY                       (A District of Columbia and Virginia corporation)                    First Mortgage Bond, 4.31% Series due November 1, 2048   No. [______]                                                      $[__________]                                                                  PPN No. [______]               POTOMAC ELECTRIC POWER COMPANY, a corporation organized and existing  under the laws of the District of Columbia and a domestic corporation of the Commonwealth of Virginia  (hereinafter called the “Company”, which term shall include any successor corporation as defined in the  Amended Indenture hereinafter referred to), for value received, hereby promises to pay to [__________]  or registered assigns, the sum of [____________] Dollars ($[___________]), on the first day of  November, 2048, in lawful money of the United States of America, and to pay interest thereon in like  money from the later of the date of delivery of the initial Bonds of 4.31% Series or the May 1st or  November 1st next preceding the date of this Bond, or if the Company shall default in the payment of  interest due on such interest payment date, then from the next preceding interest payment date or the date  of delivery of the initial Bonds of 4.31% Series, whichever is later, at the rate of four and thirty-one  hundredths percent (4.31%) per annum, payable semiannually, commencing May 1, 2019, on the first day  of May or November in each year until maturity, or, if the Company shall default in the payment of the  principal hereof, until the Company’s obligation with respect to the payment of such principal shall be  discharged as provided in the Amended Indenture. The interest so payable on any May 1 or November 1  will, subject to certain exceptions provided in the indenture dated as of June 1, 2018 supplemental to the  Amended Indenture, be paid to the person in whose name this Bond is registered at the close of business  on the first calendar day of the month in which the interest payment date occurs. Both principal of, and  interest on, this Bond are payable at the agency of the Company in the Borough of Manhattan, The City  of New York.               Reference is made to the further provisions of this Bond set forth on the reverse hereof,  and such further provisions shall for all purposes have the same effect as though fully set forth at this  place.                                         13    

 

               This Bond shall not be entitled to any benefit under the Amended Indenture or any  indenture supplemental thereto, or become valid or obligatory for any purpose, until The Bank of New  York Mellon, the Trustee under the Amended Indenture, or a successor trustee thereto under the  Amended Indenture, shall have signed the form of certificate endorsed hereon.               IN WITNESS WHEREOF, Potomac Electric Power Company has caused this Bond to be  signed in its name by the signature (or a facsimile thereof) of its President or a Vice President, and its  corporate seal (or a facsimile thereof) to be hereto affixed and attested by the facsimile signature of its  Secretary or an Assistant Secretary.   Dated:                                       POTOMAC ELECTRIC POWER COMPANY                                       By                                                                     Donna J. Kinzel, Senior Vice President, Chief                                         Financial Officer and Treasurer   Attest:                                   Assistant Secretary                            [FORM OF TRUSTEE’S CERTIFICATE]               This Bond is one of the Bonds, of the series designated therein, described in the within- mentioned Amended Indenture and the Supplemental Indenture dated as of June 1, 2018.               Dated:                        The Bank of New York Mellon, as Trustee.                                             By                                                                                        Authorized Signatory              [TEXT APPEARING ON REVERSE SIDE OF BOND OF 4.31% SERIES]               This Bond is one of a duly authorized issue of Bonds of the Company (hereinafter called  the “Bonds”) in unlimited aggregate principal amount, of the series hereinafter specified, all issued and to  be issued under and equally secured (except in so far as any purchase or sinking fund or analogous  provisions for any particular series of Bonds, established by any indenture supplemental to the Amended  Indenture hereinafter mentioned, may afford additional security for such Bonds) by a mortgage and deed  of trust, dated July 1, 1936, executed by the Company to The Bank of New York Mellon as successor to  The Riggs National Bank of Washington, D.C. (herein called the “Trustee”), as trustee, as amended by  indentures supplemental thereto dated December 10, 1939, August 10, 1942, October 15, 1942, April 1,  1966, June 16, 1981, June 17, 1981, December 1, 1981, August 1, 1982, October 1, 1982, April 15, 1983,  November 1, 1985, March 1, 1986, November 1, 1986, March 1, 1987, September 16, 1987, May 1, 1989,                                         14    

 

   August 1, 1989, April 5, 1990, May 21, 1991, May 7, 1992, September 1, 1992, November 1, 1992,  March 1, 1993, March 2, 1993, July 1, 1993, August 20, 1993, September 29, 1993, September 30, 1993,  October 1, 1993, February 10, 1994, February 11, 1994, March 10, 1995, September 6, 1995, September  7, 1995, October 2, 1997, March 17, 1999, November 17, 2003, March 16, 2004, May 24, 2005, April 1,  2006, November 13, 2007, March 24, 2008, December 3, 2008, March 28, 2012, March 11, 2013,  November 14, 2013, March 11, 2014, March 9, 2015 and May 15, 2017, (said mortgage and deed of trust,  as so amended, being herein called the “Amended Indenture”) and all indentures supplemental thereto, to  which Amended Indenture and supplemental indentures reference is hereby made for a description of the  properties mortgaged and pledged, the nature and extent of the security, the rights of the owners of the  Bonds and of the Trustee in respect thereto, and the terms and conditions upon which the Bonds are, and  are to be, secured. To the extent permitted by, and as provided in, the Amended Indenture, modifications  or alterations of the Amended Indenture, or of any indenture supplemental thereto, and of the rights and  obligations of the Company and of the holders of the Bonds may be made with the consent of the  Company by an affirmative vote of not less than 60% in amount of the Bonds entitled to vote then  outstanding, at a meeting of Bondholders called and held as provided in the Amended Indenture, and by  an affirmative vote of not less than 60% in amount of the Bonds of any series entitled to vote then  outstanding and affected by such modification or alteration, in case one or more but less than all of the  series of Bonds then outstanding under the Amended Indenture are so affected; provided, however, that  no such modification or alteration shall be made which will affect the terms of payment of the principal  of, or interest on, this Bond, which are unconditional, or which reduces the percentage of Bonds the  affirmative vote of which is required for the making of such modifications or alterations.               This Bond is one of a series designated as the “First Mortgage Bonds, 4.31% Series due  November 1, 2048” (herein called the “Bonds of 4.31% Series”) of the Company, issued under and  secured by the Amended Indenture and all indentures supplemental thereto and described in the  supplemental indenture, dated as of June 1, 2018 between the Company and the Trustee, supplemental to  the Amended Indenture.               The Bonds of 4.31% Series shall be redeemable at the option of the Company prior to the  express date of the maturity hereof, in whole or in part, at any time; provided that the Company may not  redeem less than 5% of the aggregate principal amount of the Bond of the 4.31% Series in the case of any  partial redemption. The Company shall give notice of its intent to redeem such Bonds to the holders of  such Bond of the 4.31% Series at least 30 days but no more than 60 days prior to the date fixed for such  redemption (the “Redemption Date”). If the Company redeems all or any part of the Bonds of 4.31%  Series pursuant to the provisions of this paragraph, it shall pay an amount equal to 100% of the principal  amount of the Bonds of 4.31% Series to be redeemed and a Make-Whole Amount, which shall be  calculated as follows:         “Make-Whole Amount” means, as determined by the Company, with respect to any Bond of the  4.31% Series, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled  Payments with respect to the Called Principal of such Bond of the 4.31% Series over the amount of such  Called Principal of such Bond of the 4.31% Series, provided, that the Make-Whole Amount may in no  event be less than zero.  For the purposes of determining the Make-Whole Amount, the following terms  have the following meanings:                                          15    

 

                “Business Day” means any day other than a Saturday, a Sunday or a day on which  commercial banks in New York City are required or authorized to be closed.   “Called Principal” means, with respect to any Bond of the 4.31% Series, the principal of such  Bond of the 4.31% Series that is to be redeemed or has become or is declared to be  immediately due and payable pursuant to the Amended Indenture.   “Discounted Value” means, with respect to the Called Principal of any Bond of the 4.31%  Series, the amount obtained by discounting all Remaining Scheduled Payments with respect  to such Called Principal from their respective scheduled due dates to the Settlement Date with  respect to such Called Principal, in accordance with accepted financial practice and at a  discount factor (applied on the same periodic basis as that on which interest on the Bond of  the 4.31% Series is payable) equal to the Reinvestment Yield with respect to such Called  Principal.   “Reinvestment Yield” means, with respect to the Called Principal of any Bond of the 4.31%  Series, the sum of (a) 0.50% plus (b) the yield to maturity implied by the “Ask Yield(s)”  reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the  Settlement Date with respect to such Called Principal, on the display designated as “Page  PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for  the most recently issued actively traded on-the-run U.S. Treasury securities (“Reported”)  having a maturity equal to the Remaining Average Life of such Called Principal as of such  Settlement Date.  If there are no such U.S. Treasury securities Reported having a maturity  equal to such Remaining Average Life, then such implied yield to maturity will be  determined by (i) converting U.S. Treasury bill quotations to bond equivalent yields in  accordance with accepted financial practice and (ii) interpolating linearly between the “Ask  Yields” Reported for the applicable most recently issued actively traded on-the-run U.S.  Treasury securities with the maturities (1) closest to and greater than such Remaining  Average Life and (2) closest to and less than such Remaining Average Life.  The  Reinvestment Yield shall be rounded to the number of decimal places as appears in the  interest rate of the applicable Bond of the 4.31% Series.   If such yields are not Reported or the yields Reported as of such time are not ascertainable  (including by way of interpolation), then “Reinvestment Yield” means, with respect to the  Called Principal of any Bond of the 4.31% Series, the sum of (x) 0.50% plus (y) the yield to  maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for  which such yields have been so reported as of the second Business Day preceding the  Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release  H.15 (or any comparable successor publication) for the U.S. Treasury constant maturity  having a term equal to the Remaining Average Life of such Called Principal as of such  Settlement Date.  If there is no such U.S. Treasury constant maturity having a term equal to  such Remaining Average Life, such implied yield to maturity will be determined by  interpolating linearly between (1) the U.S. Treasury constant maturity so reported with the  term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury  constant maturity so reported with the term closest to and less than such Remaining Average  Life.  The Reinvestment Yield shall be rounded to the number of decimal places as appears in  the interest rate of the applicable Bond of the 4.31% Series.   “Remaining Average Life” means, with respect to any Called Principal, the number of years  obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by  multiplying (a) the principal component of each Remaining Scheduled Payment with respect                                16                 

 

            to such Called Principal by (b) the number of years, computed on the basis of a 360-day year           comprised of twelve 30-day months and calculated to two decimal places, that will elapse           between the Settlement Date with respect to such Called Principal and the scheduled due date           of such Remaining Scheduled Payment.            “Remaining Scheduled Payments” means, with respect to the Called Principal of any Bond of           the 4.31% Series, all payments of such Called Principal and interest thereon that would be           due after the Settlement Date with respect to such Called Principal if no payment of such           Called Principal were made prior to its scheduled due date, provided that if such Settlement           Date is not a date on which interest payments are due to be made under the Bond of the           4.31% Series, then the amount of the next succeeding scheduled interest payment will be           reduced by the amount of interest accrued to such Settlement Date and required to be paid on           such Settlement Date.            “Settlement Date” means, with respect to the Called Principal of any Bond of the 4.31%           Series, the date on which such Called Principal is to be prepaid or has become or is declared           to be immediately due and payable pursuant to the Amended Indenture, as the context           requires. The Company’s notice of redemption to the holders of Bonds of 4.31% Series shall           specify such date (which shall be a Business Day), the aggregate principal amount of the           Bonds of 4.31% Series to be prepaid on such date, the principal amount of each bond of           4.31% Series held by such holder to be prepaid (determined in accordance with the next           paragraph hereof), and the interest to be paid on the prepayment date with respect to such           principal amount being prepaid, and shall be accompanied by a certificate of the chief           financial officer, principal accounting officer, treasurer, assistant treasurer or comptroller of           the Company (each, a “Senior Financial Officer”) as to the estimated Make-Whole Amount           due in connection with such prepayment (calculated as if the date of such notice were the date           of the prepayment), setting forth the details of such computation.  Two Business Days prior to           such prepayment, the Company shall deliver to the Trustee and each holder of Bonds of           4.31% Series a certificate of a Senior Financial Officer specifying the calculation of such           Make-Whole Amount as of the specified prepayment date.               In the case of each partial prepayment of the Bonds of 4.31% Series, the principal amount  of the Bonds of 4.31% Series to be prepaid shall be allocated among all of the Bonds of 4.31% Series at  the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts  thereof not theretofore called for prepayment.               In the case of each prepayment of Bonds of 4.31% Series, the principal amount of each  bond of 4.31% Series to be prepaid shall mature and become due and payable on the date fixed for such  prepayment, together with interest on such principal amount accrued to such date and the applicable  Make-Whole Amount, if any.  From and after such date, unless the Company shall fail to pay such  principal amount when so due and payable, together with the interest and Make-Whole Amount, if any, as  aforesaid, interest on such principal amount shall cease to accrue.  Any bond of 4.31% Series paid or  prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no bond  of 4.31% Series shall be issued in lieu of any prepaid principal amount of any bond of 4.31% Series.               The Company shall deliver to the Trustee before any Redemption Date for the Bonds of  4.31% Series its calculation of the amount applicable to such redemption. The Trustee shall be under no  duty to inquire into, may presume the correctness of, and shall be fully protected in acting upon, the  Company’s calculation of any redemption price of the Bonds of 4.31% Series.                                         17    

 

               If at the time notice of redemption is given the redemption moneys are not on deposit  with the Trustee, then the redemption shall be subject to the receipt of such moneys on or before the  Redemption Date, and such notice shall be of no effect unless such moneys are received.               In case an event of default, as defined in the Amended Indenture, shall occur, the  principal of all the Bonds at any such time outstanding under the Amended Indenture may be declared or  may become due and payable, upon the conditions and in the manner and with the effect provided in the  Amended Indenture. The Amended Indenture 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 is transferable by the registered owner hereof, in person or by duly authorized  attorney, on the books of the Company to be kept for that purpose at the agency of the Company in the  Borough of Manhattan, The City of New York, upon surrender and cancellation of this Bond and on  presentation of a duly executed written instrument of transfer, and thereupon a new Bond or Bonds of the  same series, of the same aggregate principal amount and in authorized denominations will be issued to the  transferee or transferees in exchange therefor; and this Bond, with or without others of the same series,  may in like manner be exchanged for one or more new Bonds of the same series of other authorized  denominations but of the same aggregate principal amount; all subject to the terms and conditions set  forth in the Amended Indenture.               No recourse shall be had for the payment of the principal of, or the interest on, this Bond,  or for any claim based hereon or otherwise in respect hereof or of the Amended Indenture or any  indenture supplemental thereto, against any incorporator, or against any stockholder, director or officer,  past, present or future, of the Company or of any predecessor or successor corporation, either directly or  through the Company or any such predecessor or successor corporation, whether for amounts unpaid on  stock subscriptions or by virtue of any constitution, statute or rule of law, or by the enforcement of any  assessment or penalty or otherwise, all such liability, whether at common law, in equity, by any  constitution, statute or otherwise, of incorporators, stockholders, directors or officers being released by  every owner hereof by the acceptance of this Bond and as part of the consideration for the issue hereof,  and being likewise released by the terms of the Amended Indenture.                                   [END OF FORM]               SECTION 3. The Bonds of 4.31% Series shall be registered Bonds without coupons in  denominations of any multiple of $1,000, numbered consecutively upwards from R-1.                SECTION 4. The Bonds of 4.31% Series shall bear the following legend:   “THIS BOND HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS  AMENDED, OR THE SECURITIES OR “BLUE SKY” LAWS OF ANY OTHER JURISDICTION,  AND MAY BE TRANSFERRED ONLY IN COMPLIANCE WITH SUCH REGISTRATION  REQUIREMENTS OR UNDER AN EXEMPTION THEREFROM.”               SECTION 5. In addition to the events of default described in Article IX of the Indenture,  an event of default with respect to the Bonds of 4.31% Series will include the additional events of default  described in Section 11 of the Bond Purchase Agreement  between the Company and the initial holders of                                        18    

 

   the Bonds of 4.31% Series specified on Schedule A to the Bond Purchase Agreement.  The Trustee shall  not be deemed to have knowledge of any event of default under the Bond Purchase Agreement unless a  responsible officer of the Trustee shall have received written notice thereof from the Company or by the  holders of the Bonds of 4.31% Series then outstanding.               SECTION 6. In  order  to  enable  the  Trustee  to  comply  with  its  obligations  under  applicable tax laws, rules and regulations in effect from time to time (“Applicable Law”), the Company  shall provide to the Trustee, following written request from the Trustee, such information concerning the  holders of the Bonds of 4.31% Series as the Trustee may reasonably request in order to determine whether  the Trustee has any tax-related obligations under Applicable Law with respect to the payments made to  holders of the Bonds of 4.31% Series, but only to the extent (a) such information is in the Company’s  possession, (b) such information is not subject to any confidentiality or similar agreement or undertaking  or otherwise deemed by the Company to be confidential and (c) providing such information to the Trustee  does not, in the judgment of the Company, breach or violate or constitute a default under any applicable  laws, rules or regulations or any instrument or agreement to which the Company of any of its affiliates is  a party or may be bound. The Company, the Trustee or any paying agent for the Bonds of 4.31% Series  shall  be  permitted  to  make  any  withholding  or  deduction  from  the  amount  of  principal  and  interest  payable  to  holders  of  the Bonds  of  4.31%  Series to  the  extent  required  under  Applicable  Law.  Each  holder of the Bonds  of 4.31% Series by accepting such  bond shall be  deemed  to have  agreed that the  Company may provide to the Trustee such information concerning such holder as the Trustee may request  in  order  to  determine  whether  the  Trustee  has  any  tax-related  obligations  under  Applicable  Law  with  respect to the payments made to such holder under this Supplemental Indenture; and such agreement by  each holder is part of the consideration for the issuance of the Bonds of 4.31% Series.               SECTION 7. Until Bonds of 4.31% Series in definitive form are ready for delivery, the  Company may execute, and upon its request in writing the Trustee shall authenticate and deliver, in lieu  thereof, Bonds for such series in temporary form, as provided in Section 9 of Article II of the Original  Indenture as amended.                                      PART III.                                 ISSUE OF BONDS.               SECTION 1. There is no limit as to the maximum principal amount of Bonds of 4.27%  Series or Bonds of 4.31% Series that may be authenticated and delivered by the Trustee or which may at  any one time be outstanding, except as the Original Indenture as amended limits the principal amount of  Bonds which may be issued thereunder.               SECTION 2. Subsequent to the execution and delivery hereof, Bonds of 4.27% Series in  the aggregate principal amount of $100,000,000, being the initial issue of Bonds of 4.27% Series and  Bonds of 4.31% Series in the aggregate principal amount of $100,000,000, being the initial issue of  Bonds of 4.31% Series, shall each forthwith be executed by the Company and delivered to the Trustee  and shall be authenticated by the Trustee and delivered (either before or after the recording hereof) to or  upon the order of the Company evidenced by a writing or writings, signed by its President or one of its  Vice Presidents and its Treasurer or one of its Assistant Treasurers, at such time or times as may be  requested by the Company subsequent to the receipt by the Trustee of:                                         19    

 

               (1) the certified resolution and the officers’ certificate required by Section 3(a) and  Section 3(b) of Article III of the Original Indenture as amended;               (2)   the opinion of counsel required by Section 3(c) of Article III of the Original  Indenture as amended;               (3)   cash, if any, in the amount required to be deposited by Section 3(d) of Article III  of the Original Indenture as amended, which shall be held and applied by the Trustee as provided in said  Section 3(d);               (4)   the officer’s certificate required by Section 7(a) of Article III of the Original  Indenture as amended; and               (5)   the certificates and opinions required by Article XVIII of the Original Indenture  as amended.               SECTION 3. Subsequent to the execution and delivery hereof and subject to Section 1 of  this Part III, additional Bonds of 4.27% Series and Bonds of 4.31% Series in an unlimited principal  amount may be executed by the Company and delivered to the Trustee and shall be authenticated by the  Trustee and delivered to or upon the order of the Company evidenced by a writing or writings, signed by  its President or one of its Vice Presidents and its Treasurer or one of its Assistant Treasurers, at such time  or times as may be requested by the Company subsequent to the receipt by the Trustee of such  resolutions, certificates and opinions as are required by the terms of the Original Indenture as amended  and compliance with all provisions of the Original Indenture as amended applicable to the authentication  and delivery of Bonds of 4.27% Series and Bonds of 4.31% Series.                                      PART IV.                    REDEMPTION AND CANCELLATION OF BONDS.               SECTION 1. The Bonds of 4.27% Series shall, in accordance with the provisions of  Article V of the Original Indenture as amended, be redeemable, at any time or from time to time prior to  maturity, at the option of the Company, either as a whole or in part by lot, as set forth in the form of Bond  of 4.27% Series contained in Section 2 of Part I hereof.               SECTION 2. The Bonds of 4.31% Series shall, in accordance with the provisions of  Article V of the Original Indenture as amended, be redeemable, at any time or from time to time prior to  maturity, at the option of the Company, either as a whole or in part by lot, as set forth in the form of Bond  of 4.31% Series contained in Section 2 of Part II hereof.               SECTION 3. In accordance with the provisions of Article V of the Original Indenture as  amended, notice of any redemption shall be sent by the Company through the mails, postage prepaid, at  least 30 days and not more than 60 days prior to the date of redemption, to the registered owners of any of  the Bonds to be redeemed at their addresses as the same shall appear on the transfer register of the  Company.                                          20    

 

               SECTION 4. All Bonds delivered to or redeemed by the Trustee pursuant to the  provisions of this Part IV shall forthwith be cancelled.                                      PART V.               ADDITIONAL PARTICULAR COVENANTS OF THE COMPANY.               The Company hereby covenants, warrants and agrees that so long as any Bonds of 4.27%  Series or Bonds of 4.31% Series are outstanding:               SECTION 1. The Company will not withdraw, pursuant to the provisions of Section 2 of  Article VIII of the Original Indenture as amended, any moneys held by the Trustee as part of the trust  estate in excess of an amount equal to the aggregate principal amount of such of the refundable Bonds as  were theretofore issued by the Company; and that upon any such withdrawal by the Company refundable  Bonds equal in aggregate principal amount to the amount so withdrawn shall be deemed to have been  made the basis of such withdrawal.               SECTION 2. Property additions purchased, constructed or otherwise acquired on or  before December 31, 1946 shall not be made the basis for the authentication and delivery of Bonds, or the  withdrawal of cash, or the reduction of the amount of cash required to be paid to the Trustee under any  provision of the Original Indenture as amended.                                      PART VI.       AMENDMENT OF INDENTURE TO PERMIT QUALIFICATION UNDER THE TRUST                                 INDENTURE ACT.               The Company and the Trustee, from time to time and at any time, without any vote or  consent of the holders of the Bonds of 4.27% Series or Bonds of 4.31% Series, may enter into such  indentures supplemental to the Original Indenture as may or shall by them be deemed necessary or  desirable to add to or modify or amend any of the provisions of the Original Indenture so as to permit the  qualification of the Original Indenture under the Trust Indenture Act.               Except to the extent specifically provided herein, no provision of this Supplemental  Indenture is intended to modify, and the parties hereto do hereby adopt and confirm, the provisions of  Section 318(c) of the Trust Indenture Act which amend and supersede provisions of the Original  Indenture, as supplemented, in effect prior to November 15, 1990.                                     PART VII.                                  THE TRUSTEE.               The Trustee hereby accepts the trusts hereby declared and provided and agrees to perform  the same upon the terms and conditions in the Original Indenture as amended set forth and upon the  following terms and conditions:               The Trustee shall not be responsible in any manner whatsoever for or in respect of the  validity or sufficiency of this Supplemental Indenture or the due execution hereof by the Company or for  or in respect of the recitals contained herein, all of which recitals are made by the Company solely. In                                         21    

 

   general, each and every term and condition contained in Article XIII of the Original Indenture as  amended shall apply to this Supplemental Indenture with the same force and effect as if the same were  herein set forth in full, with such omissions, variations and modifications thereof as may be appropriate to  make the same conform to this Supplemental Indenture.                                     PART VIII.                           MISCELLANEOUS PROVISIONS.               This Supplemental Indenture may be simultaneously executed in any number of  counterparts, each of which when so executed shall be deemed to be an original; but such counterparts  shall together constitute but one and the same instrument.               The Company hereby constitutes and appoints Donna J. Kinzel, one of its Senior Vice  Presidents, to be its true and lawful attorney-in-fact, for it and in its name to appear before any officer  authorized by law to take and certify acknowledgments of deeds to be recorded in the District of  Columbia, in the State of Maryland, in the Commonwealth of Virginia, and in the Commonwealth of  Pennsylvania and to acknowledge and deliver these presents as the act and deed of said Company.               The Bank of New York Mellon, hereby constitutes and appoints Laurence J. O’Brien, one  of its Vice Presidents, to be its true and lawful attorney-in-fact, for it and in its name to appear before any  officer authorized by law to take and certify acknowledgments of deeds to be recorded in the District of  Columbia, in the State of Maryland, in the Commonwealth of Virginia, and in the Commonwealth of  Pennsylvania and to acknowledge and deliver these presents as the act and deed of said The Bank of New  York Mellon.                             (SIGNATURE PAGE FOLLOWS)                                          22    

 

                 IN WITNESS WHEREOF, said Potomac Electric Power Company has caused this  Supplemental Indenture to be executed on its behalf by its President or one of its Vice Presidents and its  corporate seal to be hereto affixed and said seal and this Supplemental Indenture to be attested by its  Secretary or one of its Assistant Secretaries; and said The Bank of New York Mellon, in evidence of its  acceptance of the trust hereby created, has caused this Supplemental Indenture to be executed on its  behalf by one of its Vice Presidents, and its corporate seal to be hereto affixed and said seal and this  Supplemental Indenture to be attested by one of its authorized officers, all as of the 1st day of June, 2018.                                             Potomac Electric Power Company   (Corporate Seal)                          By /s/ Wendy E. Stark                                                                       Wendy E. Stark                                                Vice President and General Counsel   Attested:   /s/ Brian J. Buck                                          Brian J. Buck               Assistant Secretary            Signed, sealed and delivered by         Potomac Electric Power Company in                 the presence of:                                                                                                             As Witnesses                                                             Company Signature Page  

 

                                             The Bank of New York Mellon, as Trustee   (Corporate Seal)                          By /s/ Laurence J. O'Brien   Attested:                                     Laurence J. O’Brien                                                Vice President   /s/ Latoya Elvin                                            Latoya Elvin                 Vice President          Signed, sealed and delivered by The       Bank of New York Mellon in the presence                     of:                                                                                                             As Witnesses                                  Trustee’s Signature Page  

 

   City of Washington,   District of Columbia, ss.:               I, Dorothy Bonds, a Notary Public in and for the District of Columbia, United States of  America, do hereby certify that Wendy E. Stark and Brian J. Buck, whose names as Vice President and  General Counsel and Assistant Secretary, respectively, of Potomac Electric Power Company, a  corporation, are signed to the foregoing and hereto attached deed, bearing date as of the 1st  day of June,  2018, personally appeared this day before me in my District aforesaid and acknowledged themselves to  be, respectively, the Vice President and General Counsel and the Assistant Secretary of Potomac Electric  Power Company, and that they as such, being authorized so to do, executed the said deed by signing the  name of Potomac Electric Power Company by Wendy E. Stark as Vice President and General Counsel,  and attested by Brian J. Buck, as Assistant Secretary, and acknowledged the same before me in my  District aforesaid and acknowledged the foregoing instrument to be the act and deed of Potomac Electric  Power Company.               Given under my hand and official seal this 1st day of June, 2018.   (Notarial Seal)                                       /s/ Dorothy Bonds                                                         Notary Public                                       District of Columbia                                       My Commission Expires:    Certification:   This document was prepared under the supervision of an attorney admitted to practice before the Court of  Appeals of Maryland, or by or on behalf of one of the parties named in the within instrument.                                       /s/ Brian J. Buck                                                         Brian J. Buck, Esq                         

 

   City of Washington,   District of Columbia, ss.:               I, Dorothy Bonds, a Notary Public in and for the District of Columbia, United States of  America, do hereby certify that Wendy E. Stark, a Vice President and General Counsel of Potomac  Electric Power Company, a corporation, one of the parties to the foregoing instrument bearing date as of  the 1st day of June, 2018, and hereto annexed, this day personally appeared before me in the City of  Washington, the said Wendy E. Stark being personally well known to me as the person who executed the  said instrument as a Vice President and General Counsel of and on behalf of said Potomac Electric Power  Company and known to me to be the attorney-in-fact duly appointed therein to acknowledge and deliver  said instrument on behalf of said corporation, and, as such attorney-in-fact, she acknowledged said  instrument to be the act and deed of said Potomac Electric Power Company, and delivered the same as  such. I further certify that the said Wendy E. Stark, being by me duly sworn, did depose and say that she  knows the seal of said corporation; that the seal affixed to said instrument is such corporate seal and was  so affixed by order of the Board of Directors of said corporation; and that she signed her name thereto by  like order.                Given under my hand and official seal this 1st day of June, 2018.   (Notarial Seal)                                       /s/ Dorothy Bonds                                                         Notary Public                                       District of Columbia                                       My Commission Expires:                                  

 

   STATE OF NEW JERSEY :        SS:  COUNTY OF PASSAIC    :                 On the 1st day of June, 2018, before me personally came Laurence J. O’Brien and Latoya  Elvin, to me known, who, being by me duly sworn, did depose and say that he/she is the Vice President of  THE BANK OF NEW YORK MELLON, the New York banking corporation described in and which  executed the forgoing instrument, dated the date hereof; and that he/she signed his/her name thereto on  behalf of THE BANK OF NEW YORK MELLON by order of the board of directors of said corporation.                (Notarial Seal)                                       /s/ Rosemarie Socorro-Garcia                                              Notary Public                                                                           

 

     STATE OF NEW JERSEY :        SS:  COUNTY OF PASSAIC    :           On the 1st day of June, 2018, before me personally came Laurence J. O’Brien, to me known, who,  being by me duly sworn, did depose and say that he is the Vice President of THE BANK OF NEW  YORK MELLON, the New York banking corporation described in and which executed the forgoing  instrument; and that he is the Vice President of said Trustee for the purpose of perfecting such  Supplemental Indenture and that the consideration in the Original Indenture referred to therein and in all  indentures supplemental to said Original Indenture, including the foregoing Supplemental Indenture, is  true and bona fide as therein set forth.    (Notarial Seal)                                         /s/ Rosemarie Socorro-Garcia                                              Notary Public                                                                           

 

   STATE OF NEW JERSEY :        SS:  COUNTY OF PASSAIC    :                 I, Rosemarie Socorro-Garcia, a Notary Public in and for the State of New Jersey, County  of Passaic, United States of America, do hereby certify that Laurence J. O’Brien, a Vice President of The  Bank of New York Mellon, a New York banking corporation, one of the parties to the foregoing  instrument bearing date as of the 1st day of June, 2018 and hereto annexed, this day personally appeared  before me, the said Vice President, being personally well known to me as the person who executed the  said instrument as a Vice President of and on behalf of said The Bank of New York Mellon, and known to  me to be the attorney-in-fact duly appointed therein to acknowledge and deliver said instrument on behalf  of said corporation, and, as such attorney-in-fact, he acknowledged said instrument to be the act and deed  of said The Bank of New York Mellon, and delivered the same as such. I further certify that the said  Laurence J. O’Brien, being by me duly sworn, did depose and say that he knows the seal of said  corporation; that the seal affixed to said instrument is such corporate seal and was so affixed by order of  the Board of Directors of said corporation; and that he signed his name thereto by like order.                   (Notarial Seal)                                       /s/ Rosemarie Socorro-Garcia                                              Notary Public                                                                           

 

                             CERTIFICATE OF RESIDENCE               The Bank of New York Mellon, Mortgagee and Trustee within named, hereby certifies  that its precise address is 101 Barclay Street, New York, New York 10286.                                             The Bank of New York Mellon, as Trustee                                             By: /s/ Laurence J. O'Brien                                                 Laurence J. O’Brien                                                 Vice President

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