Document:

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                          PECO ENERGY TRANSITION TRUST,

                                     Issuer

                                       and

                              THE BANK OF NEW YORK,

                                  Bond Trustee

                         ------------------------------

                                SERIES SUPPLEMENT

                              Dated as of [ ], 2000

                         ------------------------------

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<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                 Page
                                                                                 -----
<S>          <C>                                                                 <C>
SECTION 1.  Definitions.............................................................2
SECTION 2.  Designation; Series Issuance Dates......................................4
SECTION 3.  Initial Principal Amount; Bond Rate; Expected
             Final Payment Date; Series Termination Date; Class
             Termination Dates......................................................4
SECTION 4.  Payment Dates; Expected Amortization Schedule
             for Principal; Interest; Overcollateralization
             Amount; Monthly Allocated Balances.....................................5
SECTION 5.  Authorized Initial Denominations........................................6
SECTION 6.  Redemption..............................................................6
SECTION 7.  Credit Enhancement......................................................7
SECTION 8.  Amendments to Indenture.................................................7
SECTION 9.  Delivery and Payment for the Series 1999-A
             Transition Bonds; Form of the Series 1999-A
             Transition Bonds.......................................................8
SECTION 10. Confirmation of Indenture...............................................8
SECTION 11. Counterparts............................................................8
SECTION 12. Governing Law...........................................................8
SECTION 13. Issuer Obligation.......................................................9

Schedule A    Expected Amortization Schedule
Schedule B    Monthly Allocated Balances

Exhibit A     Form of Transition Bond

</TABLE>

<PAGE>

                         SERIES SUPPLEMENT dated as of [ ], 2000 (this
                    "Supplement"), by and between PECO ENERGY TRANSITION TRUST,
                    a Delaware statutory business trust (the "Issuer"), and THE
                    BANK OF NEW YORK, a New York banking corporation (the "Bond
                    Trustee"), as Bond Trustee under the Indenture dated as of
                    March 1, 1999, between the Issuer and the Bond Trustee (the
                    "Indenture").

                              PRELIMINARY STATEMENT

     Section 9.01 of the Indenture provides, among other things, that the Issuer
and the Bond Trustee may at any time and from time to time enter into one or
more indentures supplemental to the Indenture for the purposes of authorizing
the issuance by the Issuer of a Series of Transition Bonds and specifying the
terms thereof and for modifying certain provisions of the Indenture. The Issuer
has duly authorized the execution and delivery of this Supplement and the
creation of a Series of Transition Bonds with an initial aggregate principal
amount of $[ ] to be known as the Issuer's Transition Bonds, Series [ ] (the
"Series [ ] Transition Bonds"). All acts and all things necessary to make the
Series [ ] Transition Bonds, when duly executed by the Issuer and authenticated
by the Bond Trustee as provided in the Indenture and this Supplement and issued
by the Issuer, the valid, binding and legal obligations of the Issuer and to
make this Supplement a valid and enforceable supplement to the Indenture have
been done, performed and fulfilled and the execution and delivery hereof have
been in all respects duly and lawfully authorized. The Issuer and the Bond
Trustee are executing and delivering this Supplement in order to provide for the
Series [ ] Transition Bonds and to modify certain provisions of the Indenture in
connection therewith.

     In order to secure the payment of principal of and interest on the Series
[ ] Transition Bonds issued and to be issued under the Indenture and/or any
Series Supplement, the Issuer hereby Grants to the Bond Trustee as trustee for
the benefit of the Holders of the Transition Bonds from time to time issued and
outstanding, all of the Issuer's right, title and interest in and to (a) the
Intangible Transition Property transferred by the Seller to the Issuer from time
to time pursuant to the Sale Agreement and all proceeds thereof, (b) the Sale
Agreement except for Section 5.01 thereof solely to the extent such Section
provides for indemnification of the Issuer, (c) all Bills of Sale delivered by
the Seller pursuant to the Sale Agreement,

<PAGE>

                                                                               2

(d) the Servicing Agreement except for Section 5.02(b) thereof solely to the
extent such Section provides for indemnification of the Issuer, (e) the
Collection Account and all amounts on deposit therein from time to time, (f) all
Swap Agreements with respect to the Series [ ] Transition Bonds, (g) all other
property of whatever kind owned from time to time by the Issuer including all
accounts, accounts receivable and chattel paper, (h) all present and future
claims, demands, causes and choses in action in respect of any or all of the
foregoing and (i) all payments on or under and all proceeds of every kind and
nature whatsoever in respect of any or all of the foregoing, including all
proceeds of the conversion, voluntary or involuntary, into cash or other liquid
property, all cash proceeds, accounts, accounts receivable, general intangibles,
notes, drafts, acceptances, chattel paper, checks, deposit accounts, insurance
proceeds, condemnation awards, rights to payment of any and every kind, and
other forms of obligations and receivables, instruments and other property which
at any time constitute all or part of or are included in the proceeds of any of
the foregoing (collectively, the "Collateral").

     To have and to hold in trust to secure the payment of principal of and
premium, if any, and interest on, and any other amounts (including all fees,
expenses, counsel fees and other amounts due and owing to the Bond Trustee)
owing in respect of, the Transition Bonds equally and ratably without prejudice,
preference, priority or distinction, except as expressly provided in the
Indenture or any Series Supplement and to secure performance by the Issuer of
all of the Issuer's obligations under the Indenture and all Series Supplements
with respect to the Transition Bonds, all as provided in the Indenture.

     The Bond Trustee, as trustee on behalf of the Holders of the Transition
Bonds, acknowledges such Grant, accepts the trusts hereunder in accordance with
the provisions hereof and agrees to perform its duties required in the Indenture
and this Supplement.

     SECTION 1. Definitions. (a) Article One of the Indenture provides that the
meanings of certain defined terms used in the Indenture shall, when applied to
the Transition Bonds of a particular Series, be as defined in Article One but
with such additional provisions as are specified in the related Series
Supplement. With respect to the Series [ ] Transition Bonds, the following
definitions shall apply:

<PAGE>

                                                                               3

     "Adjustment Date" shall mean initially each August 12th, until [ ] and on
such date and thereafter, the [ ]th day of each month.

     "Authorized Initial Denominations" shall mean $1,000 and integral multiples
thereof.

     "Bond Rate" has the meaning set forth in Section 3 of this Supplement.

     "Calculation Date" means initially each May 14th, until [ ] and on such
date and thereafter the [ ]th day of each month.

     "Class Termination Date" means, with respect to any Class of the Series [ ]
Transition Bonds, the termination date therefor, as specified in Section 3 of
this Supplement.

     "Expected Amortization Schedule" means Schedule A to this Supplement.

     "Expected Final Payment Date" means, with respect to any Class of the
Series [ ] Transition Bonds, the expected final payment date therefor, as
specified in Section 3 of this Supplement.

     "Interest Accrual Period" means, with respect to any Payment Date, the
period from and including the preceding Payment Date (or, in the case of the
first Payment Date, from and including the Series Issuance Date) to and
excluding such Payment Date.

     "Monthly Allocated Interest Balance" has the meaning set forth in Section
4(e) of this Supplement.

     "Monthly Allocated Principal Balance" has the meaning set forth in Section
4(e) of this Supplement.

     "Overcollateralization Amount" has the meaning set forth in Section 4(e) of
this Supplement.

     "Payment Date" has the meaning set forth in Section 4(a) of this
Supplement.

     "Record Date" shall mean, with respect to any Payment Date, the close of
business on the day prior to such Payment Date.

<PAGE>

                                                                               4

     "Series Issuance Date" has the meaning set forth in Section 2(b) of this
Supplement.

     "Series Termination Date" has the meaning set forth in Section 3 of this
Supplement.

     "Servicing Fee Rate" shall mean 0.25% per annum so long as ITC Charges are
included in electric bills otherwise sent to Customers or, if ITC Charges are
not included in such bills, 1.50% per annum.

     (b) All terms used in this Supplement that are defined in the Indenture,
either directly or by reference therein, have the meanings assigned to them
therein, except to the extent such terms are defined or modified in this
Supplement or the context clearly requires otherwise.

     SECTION 2. Designation; Series Issuance Dates. (a) Designation. The Series
[ ] Transition Bonds shall be designated generally as the Issuer's Transition
Bonds, Series [ ] and further denominated as Classes A-1 through A-[4].

     (b) Series Issuance Date. The Series [ ] Transition Bonds that are
authenticated and delivered by the Bond Trustee to or upon the order of the
Issuer on [ ], 2000 (the "Series Issuance Date") shall have as their date of
authentication [ ], 2000. Each other Series [ ] Transition Bond shall be dated
the date of its authentication.

     SECTION 3. Initial Principal Amount; Bond Rate; Expected Final Payment
Date; Series Termination Date; Class Termination Dates. The Transition Bonds of
each Class of the Series [ ] Transition Bonds shall have the initial principal
amounts, bear interest at the rates per annum and shall have Expected Final
Payment Dates and Class Termination Dates as set forth below:

<TABLE>
<CAPTION>
             Initial
            Principal              Bond                  Expected Final                  Class
Class         Amount               Rate                   Payment Date              Termination Date
-----       ---------              ----                  --------------             ----------------
<S>          <C>                   <C>                   <C>                        <C>
A-1
A-2
A-3
A-4

</TABLE>

<PAGE>

                                                                               5

     The Bond Rate for each Class shall be computed on the basis of a 360-day
year of twelve 30-day months.

     SECTION 4. Payment Dates; Expected Amortization Schedule for Principal;
Interest; Overcollateralization Amount; Monthly Allocated Balances. (a) Payment
Dates. The Payment Dates for each Class of the Series [ ] Transition Bonds are
March 1 and September 1 of each year or, if any such date is not a Business Day,
the next succeeding Business Day, commencing on [ , 2000] and continuing until
the earlier of repayment of such Class in full and the applicable Class
Termination Date.

     (b) Expected Amortization Schedule for Principal. Unless an Event of
Default shall have occurred and be continuing and the unpaid principal amount of
all Series of Transition Bonds has been declared to be due and payable together
with accrued and unpaid interest thereon, on each Payment Date, the Bond Trustee
shall distribute to the Series [ ] Transition Bondholders of record as of the
related Record Date amounts payable in respect of the Series [ ] Transition
Bonds pursuant to Section 8.02(e) of the Indenture as principal, in accordance
with the Expected Amortization Schedule. Available funds in the Series __
Subaccount will be allocated in a sequential manner, to the extent funds are
available, as follows: (1) to the holders of the Series __ Transition Bonds,
Class A-1, until this Class is retired in full, (2) to the holders of the Series
__ Transition Bonds, Class A-2, until this Class is retired in full, (3) to the
holders of the Series __ Transition Bonds, Class A-3, until this Class is
retired in full, and (4) to the holders of the Series __ Transition Bonds, Class
A-4, until this Class is retired in full. Other than in the event of an
acceleration of payments following an Event of Default or a redemption, in no
event shall a principal payment pursuant to this Section 4(b) on any Class on a
Payment Date be greater than the amount that reduces the Outstanding Amount of
such Class of Series [ ] Transition Bonds to the amount specified in the
Expected Amortization Schedule which is attached as Schedule A hereto for such
Class and Payment Date. In the event of an acceleration of payments following an
Event of Default on the Series __ Transition Bonds, principal payments on each
Class of Series __ Transition Bonds will be made on a pro rata basis based on
the respective Outstanding Amount of each Class as of the prior Payment Date.

     (c) Interest. Interest will be payable on each Class of the Series [ ]
Transition Bonds on each Payment Date in an amount equal to one-half of the
product of (i) the applicable Bond Rate and (ii) the Outstanding

<PAGE>

                                                                               6

Amount of the related Class of Transition Bonds as of the close of business on
the preceding Payment Date after giving effect to all payments of principal made
to the holders of the related Class of Series [ ] Transition Bonds on such
preceding Payment Date; and provided, further, that with respect to the initial
Payment Date or, if no payment has yet been made, interest on the outstanding
principal balance will accrue from and including the Series Issuance Date to,
but excluding, the following Payment Date.

     (d) Overcollateralization Amount. The Overcollateralization Amount for the
Series [ ] Transition Bonds shall be $[ ].

     (e) Monthly Allocated Balances. The Monthly Allocated Interest Balance and
Monthly Allocated Principal Balance for any Monthly Allocation Date and the
Series [ ] Transition Bonds shall be as set forth in Schedule B hereto.

     Not later than each Schedule Revision Date, the Issuer shall deliver to the
Bond Trustee replacement Schedules A and B hereto, adjusted to reflect the event
giving rise to such Schedule Revision Date and setting forth the Expected
Amortization Schedule for each Payment Date and the Monthly Allocated Interest
Balance and Monthly Allocated Principal Balance for each Monthly Allocation
Date; provided, however, that no such replacement schedules shall be required if
the event giving rise to such Schedule Revision Date is a redemption of the
Series [ ] Transition Bonds in whole.

     SECTION 5. Authorized Initial Denominations. The Series [ ] Transition
Bonds shall be issuable in the Authorized Initial Denominations.

     SECTION 6. Redemption. (a) Mandatory Redemption. The Series [ ] Transition
Bonds shall not be subject to mandatory redemption except as provided in Section
10.02 of the Indenture in the event that the Issuer receives Liquidated Damages.
If the Issuer receives Liquidated Damages from the Seller as a result of a
breach of a representation and warranty under the Sale Agreement which relates
to one of the Qualified Rate Orders, but not both of the Qualified Rate Orders,
then (i) only the Affected Transition Bonds will be redeemed and (ii) the
Redemption Price shall be equal to the then outstanding principal amount of the
Affected Transition Bonds as of the Liquidated Damages Redemption Date plus
accrued interest to such Redemption Date.

<PAGE>

                                                                               7

     (b) Optional Redemption. The Series [ ] Transition Bonds shall not be
subject to optional redemption by the Issuer except that the Series [ ]
Transition Bonds may be redeemed in whole at a Redemption Price equal to the
principal amount thereof plus interest at the applicable Bond Rate accrued to
the Redemption Date on any Payment Date on which the Outstanding Amount thereof
(after giving effect to payments that would otherwise be made on such Payment
Date) has been reduced to less than 5% of the initial principal balance thereof.

     SECTION 7. Credit Enhancement. No credit enhancement (other than the
Overcollateralization Amount) is provided for the Series [ ] Transition Bonds.

     SECTION 8. Amendments to Indenture. In connection with the issuance of the
Series [ ] Transition Bonds, the Indenture shall be amended as follows:

     (a) Section 1.01(a) of the Indenture shall be amended by (i) amending the
definition of "Liquidated Damages" by deleting the phrase "5.01(c)(ii) or" in
the second line thereof; (ii) amending the definition of "Liquidated Damages
Redemption Date" by adding the word "Affected" after the phrase "for the
redemption of" in the second line thereof; (iii) amending the definition of
"Sale Agreement" by replacing the phrase "Intangible Transition Property Sale
Agreement dated as of March 25, 1999" with the phrase "Amended and Restated
Intangible Transition Property Sale Agreement dated as of [ ], 2000"; and (iv)
amending the definition of "Servicing Agreement" by replacing the phrase "Master
Servicing Agreement dated as of March 25, 1999" with the phrase "Amended and
Restated Master Servicing Agreement dated as of [ ], 2000".

     (b) Section 1.01(b) of the Indenture shall be amended by (i) adding the
term "Affected Transition Bonds" in proper alphabetical order and (ii) replacing
the term "Qualified Rate Order" with the term "Qualified Rate Orders".

     (c) Section 3.10(vi) of the Indenture shall be amended by replacing the
term "Qualified Rate Order" with the term "Qualified Rate Orders" in each of the
second line and third line thereof.

     (d) Section 8.02(f) of the Indenture shall be amended by (i) adding the
following phrase at the end of clause (iv) thereof: "provided that if the Issuer
receives Liquidated Damages from the Seller as a result of a breach of a
representation and warranty under the Sale Agreement

<PAGE>

                                                                               8

which relates to one of the Qualified Rate Orders, but not both of the Qualified
Rate Orders, then only the Redemption Price and accrued interest for the
Affected Transition Bonds shall be paid to Transition Bondholders of such
Series, and any amounts due to any Counterparty pursuant to a Swap Agreement
entered into in connection with the issuance of the Affected Transition Bonds
shall be paid to such Counterparty;" and (ii) adding the following phrase at the
end of clause (vi) thereof: "provided that if the Issuer receives Liquidated
Damages from the Seller as a result of a breach of a representation and warranty
under the Sale Agreement which relates to one of the Qualified Rate Orders, but
not both of the Qualified Rate Orders, then the balance, if any, will remain in
the Collection Account".

     (e) Section 10.02(a) of the Indenture shall be amended by adding the
following phrase at the end of clause (ii) thereof: "; provided that if the
Issuer receives Liquidated Damages from the Seller as a result of a breach of a
representation and warranty under the Sale Agreement which relates to one of the
Qualified Rate Orders, but not both of the Qualified Rate Orders, then (1) only
the Affected Transition Bonds will be redeemed and (2) the Redemption Price
shall be equal to the then outstanding principal amount of the Affected
Transition Bonds as of the Liquidated Damages Redemption Date plus accrued
interest to such Redemption Date".

     SECTION 9. Delivery and Payment for the Series [ ] Transition Bonds; Form
of the Series [ ] Transition Bonds. The Bond Trustee shall deliver the Series
[ ] Transition Bonds to the Issuer when authenticated in accordance with Section
2.02 of the Indenture. The Series [ ] Transition Bonds of each Class shall be in
the form of Exhibits A-1 through A-[4] hereto.

     SECTION 10. Confirmation of Indenture. As supplemented by this Supplement,
the Indenture is in all respects ratified and confirmed and the Indenture, as so
supplemented by this Supplement, shall be read, taken, and construed as one and
the same instrument.

     SECTION 11. Counterparts. This Supplement may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all of such counterparts shall together constitute but one and the same
instrument.

     SECTION 12. Governing Law. This Supplement shall be construed in accordance
with the laws of the Commonwealth of Pennsylvania, without reference to its
conflict of law

<PAGE>

                                                                               9

provisions, and the obligations, rights and remedies of the parties hereunder
shall be determined in accordance with such laws.

     SECTION 13. Issuer Obligation. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer or the Bond Trustee on
the Transition Bonds or under this Supplement or any certificate or other
writing delivered in connection herewith or therewith, against (i) any owner of
a beneficial interest in the Issuer or (ii) any partner, owner, beneficiary,
agent, officer, director or employee of the Bond Trustee, any holder of a
beneficial interest in the Issuer or the Bond Trustee or of any successor or
assign of the Bond Trustee, except as any such Person may have expressly agreed
(it being understood that none of the Bond Trustee's obligations are in its
individual capacity).

<PAGE>

                                                                              10

     IN WITNESS WHEREOF, the Issuer and the Bond Trustee have caused this
Supplement to be duly executed by their respective officers thereunto duly
authorized as of the first day of the month and year first above written.

                                     PECO ENERGY TRANSITION TRUST,

                                     by First Union Trust Company,
                                        National Association, not in
                                        its individual capacity but
                                        solely as Issuer Trustee,
                                        Delaware Trustee and
                                        Independent Trustee

                                       by
                                           ---------------------------
                                           Name:
                                           Title:

                                      THE BANK OF NEW YORK, not in
                                      its individual capacity but
                                      solely as Bond Trustee on
                                      behalf of the Transition
                                      Bondholders,

                                       by
                                           ----------------------------
                                           Name:
                                           Title:

<PAGE>

                                                                      SCHEDULE A

                         Expected Amortization Schedule

                          Outstanding Principal Balance

<TABLE>
<CAPTION>

Payment Date                Class A-1          Class A-2       Class A-3        Class A-4          Series 1999-A
----------------------      ---------          ---------       ---------        ---------          -------------
<S>                         <C>                <C>             <C>              <C>                <C>
Series Issuance Date..
September 1, 2000.....
March 1, 2001.........
September 1, 2001.....
March 1, 2002.........
September 1, 2002.....
March 1, 2003.........
September 1, 2003.....
March 1, 2004.........
September 1, 2004.....
March 1, 2005.........
September 1, 2005.....
March 1, 2006.........
September 1, 2006.....
March 1, 2007.........
September 1, 2007.....
March 1, 2008.........
September 1, 2008.....
March 1, 2009.........
September 1, 2009.....

</TABLE>

<PAGE>

                                                                      SCHEDULE B

                           Monthly Allocated Balances

<TABLE>
<CAPTION>
                                                   Monthly Allocated                          Monthly Allocated
Monthly Allocation Date                            Interest Balance                           Principal Balance
--------------------------------------             -----------------                          -----------------
<S>                                                <C>                                        <C>
May 1, 2000...........................
June 1, 2000..........................
July 1, 2000..........................
August 1, 2000........................
September 1, 2000.....................
October 1, 2000.......................
November 1, 2000......................
December 1, 2000......................
January 1, 2001.......................
February 1, 2001......................
March 1, 2001.........................
April 1, 2001.........................
May 1, 2001...........................
June 1, 2001..........................
July 1, 2001..........................
August 1, 2001........................
September 1, 2001.....................
October 1, 2001.......................
November 1, 2001......................
December 1, 2001......................
January 1, 2002.......................
February 1, 2002......................
March 1, 2002.........................
April 1, 2002.........................
May 1, 2002...........................
June 1, 2002..........................
July 1, 2002..........................
August 1, 2002........................
September 1, 2002.....................
October 1, 2002.......................
November 1, 2002......................
December 1, 2002......................
January 1, 2003.......................
February 1, 2003......................
March 1, 2003.........................
April 1, 2003.........................
May 1, 2003...........................
June 1, 2003..........................
July 1, 2003..........................
August 1, 2003........................
September 1, 2003.....................
October 1, 2003.......................
November 1, 2003......................
December 1, 2003......................
January 1, 2004.......................
February 1, 2004......................
March 1, 2004.........................
April 1, 2004.........................
May 1, 2004...........................
June 1, 2004..........................
July 1, 2004..........................
August 1, 2004........................

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                                                   Monthly Allocated                          Monthly Allocated
Monthly Allocation Date                            Interest Balance                           Principal Balance
--------------------------------------             -----------------                          -----------------
<S>                                                <C>                                        <C>
September 1, 2004.....................
October 1, 2004.......................
November 1, 2004......................
December 1, 2004......................
January 1, 2005.......................
February 1, 2005......................
March 1, 2005.........................
April 1, 2005.........................
May 1, 2005...........................
June 1, 2005..........................
July 1, 2005..........................
August 1, 2005........................
September 1, 2005.....................
October 1, 2005.......................
November 1, 2005......................
December 1, 2005......................
January 1, 2006.......................
February 1, 2006......................
March 1, 2006.........................
April 1, 2006.........................
May 1, 2006...........................
June 1, 2006..........................
July 1, 2006..........................
August 1, 2006........................
September 1, 2006.....................
October 1, 2006.......................
November 1, 2006......................
December 1, 2006......................
January 1, 2007.......................
February 1, 2007......................
March 1, 2007.........................
April 1, 2007.........................
May 1, 2007...........................
June 1, 2007..........................
July 1, 2007..........................
August 1, 2007........................
September 1, 2007.....................
October 1, 2007.......................
November 1, 2007......................
December 1, 2007......................
January 1, 2008.......................
February 1, 2008......................
March 1, 2008.........................
April 1, 2008.........................
May 1, 2008...........................
June 1, 2008..........................
July 1, 2008..........................
August 1, 2008........................
September 1, 2008.....................
October 1, 2008.......................
November 1, 2008......................

</TABLE>

<PAGE>

<TABLE>
<CAPTION>
                                                   Monthly Allocated                          Monthly Allocated
Monthly Allocation Date                            Interest Balance                           Principal Balance
--------------------------------------             -----------------                          -----------------
<S>                                                <C>                                        <C>
December 1, 2008......................
January 1, 2009.......................
February 1, 2009......................
March 1, 2009.........................
April 1, 2009.........................
May 1, 2009...........................
June 1, 2009..........................
July 1, 2009..........................
August 1, 2009........................
September 1, 2009.....................
October 1, 2009.......................
November 1, 2009......................
December 1, 2009......................
[                          ]..........

</TABLE>

<PAGE>

                                                                       EXHIBIT A

                             Form of Transition Bond

                                [To be provided]REGISTERED                                                          $[        ]
No. ______

                       SEE REVERSE FOR CERTAIN DEFINITIONS

                                                  CUSIP NO.

         THE PRINCIPAL OF THIS CLASS [ ] TRANSITION BOND WILL BE PAID IN
INSTALMENTS AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT
OF THIS CLASS [ ] TRANSITION BOND AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN
ON THE FACE HEREOF.

                          PECO ENERGY TRANSITION TRUST

                    TRANSITION BONDS, SERIES [    ], Class [    ].

Bond                    Original Principal                      Expected Final
Rate                          Amount                           Amortization Date
----                          ------                           -----------------
[   ]%                      $[        ]                            [ ], [ ]

         PECO Energy Transition Trust, a statutory business trust organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to the Registered Holder
hereof, or registered assigns, the Original Principal Amount shown above in
[monthly][quarterly][semi-annual] instalments on the Payment Dates and in the
amounts specified on the reverse hereof or, if less, the amounts determined
pursuant to Section 8.02(e) of the Indenture, in each year, commencing on the
date determined as provided on the reverse hereof and ending on or before the
Class Rated Final Payment Date, to pay the entire unpaid principal hereof on the
Class Final Maturity Date and to pay interest, at [the Bond Rate shown above][a
floating rate calculated as follows [insert formula]], on each [ ] or if any
such day is not a Business Day, the next succeeding Business Day, commencing on
[ ], 2000 and continuing until the earlier of the payment of the principal
hereof and the Class Termination Date (each a "Payment Date"), on the principal
amount of this Class [ ] Transition Bond outstanding from time to time. Interest
on this Class [ ] Transition Bond will accrue for each Payment Date from the
most recent

<PAGE>

                                                                              2

Payment Date on which interest has been paid to but excluding such Payment Date
or, if no interest has yet been paid, from [ ], 2000. Interest will be computed
on the basis of [a 360-day year of twelve 30-day months]. Such principal of and
interest on this Class [ ] Transition Bond shall be paid in the manner specified
on the reverse hereof.

         The principal of and interest on this Class [ ] Transition Bond are
payable in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts. All payments
made by the Issuer with respect to this Class [ ] Transition Bond shall be
applied first to interest due and payable on this Class [ ] Transition Bond as
provided above and then to the unpaid principal of and premium, if any, on this
Class [ ] Transition Bond, all in the manner set forth in Section 8.02(e) of the
Indenture.

         Reference is made to the further provisions of this Class [ ]
Transition Bond set forth on the reverse hereof, which shall have the same
effect as though fully set forth on the face of this Class [ ] Transition Bond.

         Unless the certificate of authentication hereon has been executed by
the Bond Trustee whose name appears below by manual signature, this Class [ ]
Transition Bond shall not be entitled to any benefit under the Indenture
referred to on the reverse hereof, or be valid or obligatory for any purpose.

<PAGE>

                                                                              3

         IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by an Authorized Officer of the Issuer Trustee.

Date:

                                        PECO ENERGY TRANSITION TRUST,

                                              by First Union Trust Company,
                                                 National Association, not in
                                                 its individual capacity but
                                                 solely as Issuer Trustee,

                                              by
                                                   ---------------------------
                                                   Name:
                                                   Title:

<PAGE>

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                  BOND TRUSTEE'S CERTIFICATE OF AUTHENTICATION

Dated:                 , 2000
      -----------------

         This is one of the Class [ ] Transition Bonds of the Series [ ]
Transition Bonds, designated above and referred to in the within-mentioned
Indenture.

                                              THE BANK OF NEW YORK,

                                                by
                                                    --------------------------
                                                    Authorized Signatory

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                          [REVERSE OF TRANSITION BOND]

         This Series [ ], Class [ ] Transition Bond is one of a duly authorized
issue of Transition Bonds of the Issuer, designated as its Transition Bonds
(herein called the "Transition Bonds"), issued and to be issued in one or more
Series, which Series are issuable in one or more Classes, and this Series [ ]
Transition Bond, in which this Class [ ] Transition Bond represents an interest,
consists of [ ] Classes, including the Class [ ] Transition Bonds (herein called
the "Class [ ] Transition Bonds"), all issued and to be issued under an
indenture dated as of March 1, 1999, and a series supplement thereto dated as of
[ ], [2000] (such series supplement, as supplemented or amended, the
"Supplement" and, collectively with such indenture, as supplemented or amended,
the "Indenture"), each between the Issuer and The Bank of New York, as Bond
Trustee (the "Bond Trustee", which term includes any successor bond trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the Collateral property pledged, the
nature and extent of the security, the respective rights, obligations and
immunities thereunder of the Issuer, the Bond Trustee and the Holders of the
Transition Bonds and the terms and conditions under which additional Transition
Bonds may be issued. All terms used in this Class [ ] Transition Bond that are
defined in the Indenture, as supplemented or amended, shall have the meanings
assigned to them in the Indenture.

         The Class [ ] Transition Bonds, the other Classes of Series [ ]
Transition Bonds and any other Series of Transition Bonds issued by the Issuer
are and will be equally and ratably secured by the Collateral pledged as
security therefor as provided in the Indenture.

         The principal of this Class [ ] Transition Bond shall be payable on
each Payment Date only to the extent that amounts in the Collection Account are
available therefor, and only until the outstanding principal balance thereof on
such Payment Date (after giving effect to all payments of principal, if any,
made on such Payment Date) has been reduced to the principal balance specified
in the Expected Amortization Schedule which is attached to the Supplement as
Schedule A, unless payable earlier either because (i) an Event of Default shall
have occurred and be continuing and the Bond Trustee or the Holders of
Transition

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Bonds representing not less than a majority of the Outstanding Amount of the
Transition Bonds of all Series have declared the Transition Bonds to be
immediately due and payable in accordance with Section 5.02 of the Indenture,
(ii) the Issuer, at its option, shall have called for the redemption of the
Series [ ] Transition Bonds in whole or from time to time in part pursuant to
Section 10.01 of the Indenture [or][,] (iii) the Issuer shall have called for
the redemption of the Series [ ] Transition Bonds pursuant to Section 10.02 of
the Indenture if the Seller is required to pay Liquidated Damages pursuant to
Section 5.01(c) or (d) of the Sale Agreement [or (iv) the Issuer shall have
called for the redemption of the Series [ ] Transition Bond in whole or from
time to time in part pursuant to Section 6(a) or 6(b) of the Supplement].
However, actual principal payments may be made in lesser than expected amounts
and at later than expected times as determined pursuant to Section 8.02(e) of
the Indenture. The entire unpaid principal amount of this Class [ ] Transition
Bond shall be due and payable on the earlier of the Class Final Maturity Date
hereof and the Redemption Date, if any, herefor. Notwithstanding the foregoing,
the entire unpaid principal amount of the Transition Bonds shall be due and
payable, if not then previously paid, on the date on which an Event of Default
shall have occurred and be continuing and the Bond Trustee or the Holders of the
Transition Bonds representing not less than a majority of the Outstanding Amount
of the Transition Bonds have declared the Transition Bonds to be immediately due
and payable in the manner provided in Section 5.02 of the Indenture. All
principal payments on the Class [ ] Transition Bonds shall be made pro rata to
the Class [ ] Transition Bondholders entitled thereto based on the respective
principal amounts of the Class [ ] Transition Bonds held by them.

         Payments of interest on this Class [ ] Transition Bond due and payable
on each Payment Date, together with the instalment of principal or premium, if
any, due on this Class [ ] Transition Bond on such Payment Date shall be made by
check mailed first-class, postage prepaid, to the Person whose name appears as
the Registered Holder of this Class [ ] Transition Bond (or one or more
Predecessor Transition Bonds) in the Transition Bond Register as of the close of
business on the Record Date or in such other manner as may be provided in the
Supplement, except that with respect to Class [ ] Transition Bonds registered on
the Record Date in the name of a Clearing Agency, payments will be made by wire
transfer in immediately available funds to

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the account designated by such Clearing Agency and except for the final
instalment of principal and premium, if any, payable with respect to this Class
[ ] Transition Bond on a Payment Date which shall be payable as provided below.
Such checks shall be mailed to the Person entitled thereto at the address of
such Person as it appears in the Transition Bond Register as of the applicable
Record Date without requiring that this Class [ ] Transition Bond be submitted
for notation of payment. Any reduction in the principal amount of this Class [ ]
Transition Bond (or any one or more Predecessor Transition Bonds) effected by
any payments made on any Payment Date shall be binding upon all future Holders
of this Class [ ] Transition Bond and of any Class [ ] Transition Bond issued
upon the registration of transfer hereof or in exchange hereof or in lieu
hereof, whether or not noted hereon. If funds are expected to be available, as
provided in the Indenture, for payment in full of the then remaining unpaid
principal amount of this Class [ ] Transition Bond on a Payment Date, then the
Bond Trustee, in the name of and on behalf of the Issuer, will notify the Person
who was the Registered Holder hereof as of the Record Date preceding such
Payment Date by notice mailed no later than five days prior to such final
Payment Date and shall specify that such final instalment will be payable only
upon presentation and surrender of this Class [ ] Transition Bond and shall
specify the place where this Class [ ] Transition Bond may be presented and
surrendered for payment of such instalment.

         The Issuer shall pay interest on overdue instalments of interest on
this Class [ ] Transition Bond at the Class [ ] Bond Rate to the extent lawful.

         As provided in the Indenture, the Class [ ] Transition Bonds may be
redeemed, in whole or from time to time in part, at the option of the Issuer on
any Redemption Date at the Redemption Price. In addition, as provided in the
Indenture, if the Seller is required to pay Liquidated Damages pursuant to
Section 5.01(c) or (d) of the Sale Agreement, the Issuer will be required to
redeem all outstanding Series of Transition Bonds, including the Class [ ]
Transition Bonds, on the Liquidated Damages Redemption Date. [The Issuer will
also be required to redeem the Class [ ] Transition Bonds in certain
circumstances as provided in Sections 6(a) and 6(b) of the Supplement.]

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         As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Class [ ] Transition Bond may be registered
in the Transition Bond Register upon surrender of this Class [ ] Transition Bond
for registration of transfer at the office or agency designated by the Issuer
pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Bond Trustee duly executed by
the Holder hereof or his attorney duly authorized in writing, with such
signature guaranteed by an Eligible Guarantor Institution, and thereupon one or
more new Class [ ] Transition Bonds of any Authorized Initial Denominations and
in the same aggregate initial principal amount will be issued to the designated
transferee or transferees. No service charge will be charged for any
registration of transfer or exchange of this Class [ ] Transition Bond, but the
transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange.

         Each Class [ ] Transition Bondholder, by acceptance of a Class [ ]
Transition Bond, covenants and agrees that no recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer or the Bond Trustee on
the Class [ ] Transition Bonds or under the Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) any
owner of a beneficial interest in the Issuer or (ii) any partner, owner,
beneficiary, agent, officer, director or employee of the Bond Trustee, any
holder of a beneficial interest in the Issuer or the Bond Trustee or of any
successor or assign of the Bond Trustee, except as any such Person may have
expressly agreed (it being understood that all of the Bond Trustee's obligations
are in its individual capacity).

         Prior to the due presentment for registration of transfer of this Class
[ ] Transition Bond, the Issuer, the Bond Trustee and any agent of the Issuer or
the Bond Trustee may treat the Person in whose name this Class [ ] Transition
Bond is registered (as of the day of determination) as the owner hereof for the
purpose of receiving payments of principal of and premium, if any, and interest
on this Class [ ] Transition Bond and for all other purposes whatsoever, whether
or not this Class [ ] Transition Bond be overdue, and neither the Issuer, the
Bond

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Trustee nor any such agent shall be affected by notice to the contrary.

         The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Transition Bonds under the Indenture
at any time by the Issuer with the consent of the Holders of Transition Bonds
representing a majority of the Outstanding Amount of all Transition Bonds at the
time Outstanding of each Series or Class to be affected. The Indenture also
contains provisions permitting the Holders of Transition Bonds representing
specified percentages of the Outstanding Amount of the Transition Bonds of all
Series, on behalf of the Holders of all the Transition Bonds, to waive
compliance by the Issuer with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Class [ ] Transition Bond (or any one of more
Predecessor Transition Bonds) shall be conclusive and binding upon such Holder
and upon all future Holders of this Class [ ] Transition Bond and of any Class [
] Transition Bond issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof whether or not notation of such consent or waiver is
made upon this Class [ ] Transition Bond. The Indenture also permits the Bond
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Transition Bonds issued
thereunder.

         The term "Issuer" as used in this Class [ ] Transition Bond includes
any successor to the Issuer under the Indenture.

         The Issuer is permitted by the Indenture, under certain circumstances,
to merge or consolidate, subject to the rights of the Bond Trustee and the
Holders of Transition Bonds under the Indenture.

         The Class [ ] Transition Bonds are issuable only in registered form in
Authorized Initial Denominations as provided in the Indenture and the
Supplement, subject to certain limitations therein set forth.

         This Class [ ] Transition Bond, the Indenture and the Supplement shall
be construed in accordance with the laws of the Commonwealth of Pennsylvania,
without reference to its conflict of law provisions, and the obligations,

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rights and remedies of the parties hereunder and thereunder shall be determined
in accordance with such laws.

         No reference herein to the Indenture and no provision of this Class [ ]
Transition Bond or of the Indenture shall alter or impair the obligation of the
Issuer, which is absolute and unconditional, to pay the principal of and
interest on this Class [ ] Transition Bond at the times, place, and rate, and in
the coin or currency herein prescribed.

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                                                                            11

                                   ASSIGNMENT

Social Security or taxpayer I.D. or other identifying number
of assignee

_____________________

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

_______________________________________________________________________________
                         (name and address of assignee)

the within Class [  ] Transition Bond and all rights
thereunder, and hereby irrevocably constitutes and appoints

_____________________________________________________________________________,
attorney, to transfer said Class [ ] Transition Bond on the books kept for
registration thereof, with full power of substitution in the premises.

Dated: ______________                            _____________________________*
                                                 Signature Guaranteed:

_____________________                            ______________________________

___________

         * NOTE: The signature to this assignment must correspond with the name
of the registered owner as it appears on the face of the within Class [ ]
Transition Bond in every particular, without alteration, enlargement or any
change whatsoever.

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