Document:

Exhibit 4.2

 

THE DAYTON POWER AND LIGHT COMPANY

AND

THE BANK OF NEW YORK

(formerly Irving Trust Company)

Trustee

 

 

Forty-Fourth
Supplemental Indenture

 

Dated as
of September 1, 2006

 

 

THE DAYTON POWER
AND LIGHT COMPANY

FORTY-FOURTH
SUPPLEMENTAL INDENTURE

DATED AS OF SEPTEMBER 1, 2006

TABLE OF
CONTENTS

	
  

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Parties

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  Recitals

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  Granting Clauses

  	
   

  	
  7

  
	
   

  	
   

  	
   

  
	
  FIRST. REAL PROPERTY AND INTERESTS IN REAL PROPERTY

  	
   

  	
  8

  
	
   

  	
   

  	
   

  
	
  SECOND. ELECTRIC GENERATING PLANTS

  	
   

  	
  8

  
	
   

  	
   

  	
   

  
	
  THIRD. TRANSMISSION LINES

  	
   

  	
  8

  
	
   

  	
   

  	
   

  
	
  FOURTH. SUBSTATIONS AND SUBSTATION SITES

  	
   

  	
  8

  
	
   

  	
   

  	
   

  
	
  FIFTH. ELECTRIC DISTRIBUTION SYSTEMS

  	
   

  	
  9

  
	
   

  	
   

  	
   

  
	
  SIXTH. LIQUEFIED PETROLEUM GAS PRODUCTION AND
  STORAGE FACILITIES

  	
   

  	
  9

  
	
   

  	
   

  	
   

  
	
  SEVENTH. GAS DISTRIBUTION SYSTEMS

  	
   

  	
  9

  
	
   

  	
   

  	
   

  
	
  EIGHTH. OFFICE AND DEPARTMENTAL BUILDINGS

  	
   

  	
  10

  
	
   

  	
   

  	
   

  
	
  NINTH. TELEPHONE LINES

  	
   

  	
  10

  
	
   

  	
   

  	
   

  
	
  TENTH. FRANCHISES

  	
   

  	
  10

  
	
   

  	
   

  	
   

  
	
  ELEVENTH. OTHER REAL ESTATE AND APPURTENANCES

  	
   

  	
  10

  
	
   

  	
   

  	
   

  
	
  TWELFTH.
  PROPERTY HEREAFTER TO BECOME SUBJECT TO THE LIEN OF THE FIRST MORTGAGE AS
  AMENDED

  	
   

  	
  11

  
	
   

  	
   

  	
   

  
	
  Habendum Clause

  	
   

  	
  11

  
	
   

  	
   

  	
   

  
	
  Subject Clause

  	
   

  	
  12

  
	
   

  	
   

  	
   

  
	
  Grant in Trust

  	
   

  	
  12

  

 

 

 

	
  ARTICLE ONE. BONDS OF THE
  4.80% POLLLUTION CONTROL SERIES 2006 DUE 2036 AND ISSUE THEREOF

  	
   

  	
  13

  
	
   

  	
   

  	
   

  
	
  Sec. 1.

  	
  Series and Form of New Bonds

  	
   

  	
  13

  
	
  Sec. 2.

  	
  Issue of New Bonds

  	
   

  	
  13

  
	
  Sec. 3.

  	
  Dates, Interest, etc., of New Bonds

  	
   

  	
  13

  
	
  Sec. 4.

  	
  Denominations
  and Exchangeability of New Bonds; Temporary Bonds may be Authenticated and
  Delivered

  	
   

  	
  14

  
	
  Sec. 5.

  	
  Mandatory Redemption of New Bonds and Redemption
  Price

  	
   

  	
  14

  
	
  Sec. 6.

  	
  Extraordinary Optional Redemptin of New Bonds and
  Redemption Price

  	
   

  	
  15

  
	
  Sec. 7.

  	
  Optional Redemption of New Bonds and Redemption
  Price

  	
   

  	
  15

  
	
  Sec. 8.

  	
  Notice of Redemption of New Bonds

  	
   

  	
  15

  
	
  Sec. 9.

  	
  New Bonds Deemed Paid in Certain Circumstances

  	
   

  	
  16

  
	
  Sec. 10.

  	
  New Bonds Deemed Paid in Additional Circumstances

  	
   

  	
  16

  
	
  Sec. 11.

  	
  Surrender of New Bonds in Certain Circumstances

  	
   

  	
  16

  
	
  Sec. 12.

  	
  Application of Article Ten of First Mortgage as
  Amended

  	
   

  	
  17

  
	
  Sec. 13.

  	
  Form of New Bonds

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE TWO. COVENANTS OF THE COMPANY

  	
   

  	
  17

  
	
   

  	
   

  	
   

  
	
  Sec. 1.

  	
  Confirmation of Covenants by Company in First
  Mortgage

  	
   

  	
  17

  
	
  Sec. 2.

  	
  Covenant of the Company and Legal Opinion as to
  Recording

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE THREE. MISCELLANEOUS

  	
   

  	
  17

  
	
   

  	
   

  	
   

  
	
  Sec. 1.

  	
  Authentication
  and Delivery of New Bonds in Advance of the Recording of Forty-Fourth
  Supplemental Indenture

  	
   

  	
  17

  
	
  Sec. 2.

  	
  Forty-Fourth Supplemental Indenture to Form Part of
  First Mortgage

  	
   

  	
  17

  
	
  Sec. 3.

  	
  Definitions in First Mortgage Shall Apply to
  Forty-Fourth Supplemental Indenture

  	
   

  	
  18

  
	
  Sec. 4.

  	
  Execution in Counterparts

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  Testimonium

  	
   

  	
  S-1

  
	
   

  	
   

  	
   

  
	
  Signatures

  	
   

  	
  S-1

  
	
   

  	
   

  	
   

  
	
  Acknowledgments

  	
   

  	
  S-2

  
	
   

  	
   

  	
   

  
	
  Exhibit A - Form of New Bond

  	
   

  	
   

  

 

FORTY-FOURTH SUPPLEMENTAL
INDENTURE, dated as of September 1, 2006, between THE DAYTON POWER AND LIGHT
COMPANY, a corporation of the State of Ohio (hereinafter sometimes called the
Company), party of the first part, and THE BANK OF NEW YORK (formerly Irving
Trust Company), a corporation of the State of New York (hereinafter sometimes
called the Trustee), as Trustee, party of the second part.

WHEREAS, the Company has heretofore executed and
delivered to Irving Trust Company (now The Bank of New York) a certain
Indenture, dated as of October 1, 1935 (hereinafter sometimes called the
First Mortgage), to secure the payment of the principal of and interest on an
issue of bonds of the Company, unlimited in aggregate principal amount
(hereinafter sometimes called the Bonds); and

WHEREAS, the Company has issued under the First
Mortgage its Bonds of a series known as the First and Refunding Mortgage Bonds,
31¤2%
Series Due 1960, authorized in unlimited aggregate principal amount, all of
which have been redeemed or otherwise retired; and

WHEREAS, in Article Two of the First Mortgage it is
provided in substance, among other things, that the Bonds may be issued in
series, the Bonds of each series maturing on such dates and bearing interest at
such rates, respectively, as the Board of Directors of the Company may
determine prior to the authentication thereof; and

WHEREAS, the Company has heretofore executed and
delivered to the Trustee forty-three supplemental Indentures numbered, dated
and, except as set forth below, providing for their respective series of First
Mortgage Bonds, all as set forth in the tabulation below:

	
  Supplemental

  Indenture

  	
   

  	
  Dated As Of

  	
   

  	
  Series

  Provided For

  	
   

  	
  Principal

  Amount

  Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  First

  	
   

  	
  March 1, 1937

  	
   

  	
  31¤4%
  Series

  Due 1962

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Second

  	
   

  	
  January 1, 1940

  	
   

  	
  3% Series

  Due 1970

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Third

  	
   

  	
  October 1, 1945

  	
   

  	
  23¤4%
  Series

  Due 1975

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fourth

  	
   

  	
  January 1, 1948

  	
   

  	
  3% Series

  Due 1978

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fifth

  	
   

  	
  December 1, 1948

  	
   

  	
  3% Series A,

  Due 1978

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sixth

  	
   

  	
  February 1, 1952

  	
   

  	
  31¤4%
  Series

  Due 1982

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Seventh

  	
   

  	
  September 1, 1954

  	
   

  	
  3% Series

  Due 1984

  	
   

  	
  None

  	
   

  

 

 

 

 

	
  Supplemental

  Indenture

  	
   

  	
  Dated As Of

  	
   

  	
  Series

  Provided For

  	
   

  	
  Principal

  Amount

  Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eighth

  	
   

  	
  November 1, 1957

  	
   

  	
  5% Series

  Due 1987

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ninth

  	
   

  	
  March 1, 1960

  	
   

  	
  51¤8%
  Series

  Due 1990

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Tenth

  	
   

  	
  June 1, 1963

  	
   

  	
  4.45% Series

  Due 1993

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eleventh

  	
   

  	
  May 1, 1967

  	
   

  	
  55¤8%
  Series

  Due 1997

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twelfth

  	
   

  	
  June 15, 1968

  	
   

  	
  63¤4%
  Series

  Due 1998

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirteenth

  	
   

  	
  October 1, 1969

  	
   

  	
  81¤4%
  Series

  Due 1999

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fourteenth

  	
   

  	
  June 1, 1970

  	
   

  	
  91¤2%
  Series

  Due 2000

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fifteenth

  	
   

  	
  August 1, 1971

  	
   

  	
  81¤8%
  Series

  Due 2001

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Sixteenth

  	
   

  	
  October 3, 1972

  	
   

  	
  None issued

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Seventeenth

  	
   

  	
  November 1, 1973

  	
   

  	
  8% Series

  Due 2003

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eighteenth

  	
   

  	
  October 1, 1974

  	
   

  	
  101¤8%
  Series

  Due 1981

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Nineteenth

  	
   

  	
  August 1, 1975

  	
   

  	
  10.70% Series

  Due 2005

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twentieth

  	
   

  	
  November 15, 1976

  	
   

  	
  83¤4%
  Series

  Due 2006

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-First

  	
   

  	
  April 15, 1977

  	
   

  	
  6.35% Series

  Due 2007

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Second

  	
   

  	
  October 15, 1977

  	
   

  	
  81¤2%
  Series

  Due 2007

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Third

  	
   

  	
  April 1, 1978

  	
   

  	
  8.95% Series

  Due 1998

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Fourth

  	
   

  	
  November 1, 1978

  	
   

  	
  91¤2%
  Series

  Due 2003

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Fifth

  	
   

  	
  August 1, 1979

  	
   

  	
  101¤4%
  Series

  Due 1999

  	
   

  	
  None

  	
   

  

 2
 

 

 

	
  Supplemental

  Indenture

  	
   

  	
  Dated As Of

  	
   

  	
  Series

  Provided For

  	
   

  	
  Principal

  Amount

  Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Sixth

  	
   

  	
  December 1, 1979

  	
   

  	
  121¤8%
  Series

  Due 2009

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Seventh

  	
   

  	
  February 1, 1981

  	
   

  	
  145¤8%
  Series

  Due 1988

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Eighth

  	
   

  	
  February 18, 1981

  	
   

  	
  141¤2%
  Series

  Due 1988

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Twenty-Ninth

  	
   

  	
  September 1, 1981

  	
   

  	
  17% Series

  Due 1991

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirtieth

  	
   

  	
  March 1, 1982

  	
   

  	
  163¤4%
  Series

  Due 2012

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-First

  	
   

  	
  November 1, 1982

  	
   

  	
  111¤2%
  Series

  Due 2012-A

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Second

  	
   

  	
  November 1, 1982

  	
   

  	
  111¤2%
  Series

  Due 2012-B

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Third

  	
   

  	
  December 1, 1985

  	
   

  	
  91¤2%
  Series

  Due 2015

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Fourth

  	
   

  	
  April 1, 1986

  	
   

  	
  9% Series

  Due 2016

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Fifth

  	
   

  	
  December 1, 1986

  	
   

  	
  87¤8%
  Series

  Due 2016

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Sixth

  	
   

  	
  August 15, 1992

  	
   

  	
  6.40% Pollution

  Control Series

  1992-A

  Due 2027

  6.40% Pollution

  Control Series

  1992-B

  Due 2027

  	
   

  	
  None

  

  

  

  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Seventh

  	
   

  	
  November 15, 1992

  	
   

  	
  6.50% Pollution

  Control Series

  1992-C

  Due 2022

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Eighth

  	
   

  	
  November 15, 1992

  	
   

  	
  8.40% Series

  Due 2022

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Ninth

  	
   

  	
  January 15, 1993

  	
   

  	
  8.15% Series

  Due 2026

  	
   

  	
  None

  	
   

  

 3
 

 

 

	
  Supplemental

  Indenture

  	
   

  	
  Dated As Of

  	
   

  	
  Series

  Provided For

  	
   

  	
  Principal

  Amount

  Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fortieth

  	
   

  	
  February 15, 1993

  	
   

  	
  77¤8%
  Series

  Due 2024

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Forty-First

  	
   

  	
  February 1, 1999

  	
   

  	
  None issued

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Forty-Second

  	
   

  	
  September 1, 2003

  	
   

  	
  5.125% Series

  Due 2013

  	
   

  	
  $

  	
  470,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Forty-Third

  	
   

  	
  August 1, 2005

  	
   

  	
  4.80%

  Pollution

  Control Series

  2005-A Due

  2034

  	
   

  	
  $

  	
  41,300,000 

  	
   

  
	
  

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  

  	
   

  	
   

  	
   

  	
  4.80%

  Pollution

  Control Series

  2005-B Due

  2034

  	
   

  	
  $

  	
  137,800,000 

  	
   

  
	
  

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  

  	
   

  	
   

  	
   

  	
  4.70%

  Pollution

  Control Series

  2005-C Due

  2028

  	
   

  	
  $

  	
  35,275,000

  	
   

  

 

WHEREAS, said Eleventh Supplemental Indenture, which
created the 55¤8%
Series Due 1997, provided in its Article Three for certain amendments to the
First Mortgage, as theretofore amended, each such amendment to become effective
on the earliest date on which either (a) there shall not be any Bonds
outstanding of Series Due 1975, Series Due 1978, Series A, Due 1978, Series Due
1982, Series Due 1984, or Series Due 1993, or (b) there shall have been
executed and delivered a supplemental indenture or indentures embodying said
amendment (either alone or with other amendments) consented to by the holders
of seventy-five per centum (75%) in aggregate principal amount of the Bonds at
the time outstanding of the series enumerated in the foregoing clause (a), or
of each said series of which Bonds are then outstanding; and

WHEREAS, said Fifteenth Supplemental Indenture, which
created the 81¤8%
Series Due 2001, provided (a) in its Article Four for an amendment to the
First Mortgage, as theretofore amended, to become effective on the date on
which the amendments provided for by Section 3 of Article Three of said
Eleventh Supplemental Indenture shall become effective and (b) in its 

 4
 

 

Article Five for certain
additional amendments to the First Mortgage, as theretofore amended, to become
effective on the earliest date on which either (i) there shall not be any
Bonds outstanding of Series Due 1975, Series Due 1978, Series A, Due 1978,
Series Due 1982, Series Due 1984, Series Due 1993, Series Due 1997, Series Due
1998, Series Due 1999, or Series Due 2000, or (ii) there shall have been
executed and delivered a supplemental indenture or indentures embodying said
amendments (either alone or with other amendments) consented to by the holders
of seventy-five per centum (75%) in aggregate principal amount of the Bonds at
the time outstanding of the series enumerated in the foregoing clause (i), or
of each said series of which Bonds are then outstanding; and

WHEREAS, the Company has heretofore executed and
delivered to the Trustee a Sixteenth Supplemental Indenture dated as of October
3, 1972, which provided in its Article One for an amendment of Article Five of
the First Mortgage, as theretofore amended, altering the requirements for the
opinion of counsel to be delivered to the Trustee as a condition precedent to
the authentication and delivery of additional Bonds under Article Five or the
withdrawal of cash under Article Seven of the First Mortgage, as theretofore
amended; and

WHEREAS, none of the Bonds of Series Due 1975, Series
Due 1978, Series A, Due 1978, Series Due 1982, Series Due 1984, or Series Due
1993 remain outstanding and the amendments contained in said Eleventh
Supplemental Indenture have become effective; and

WHEREAS, none of the Bonds of Series Due 1975, Series
Due 1978, Series A, Due 1978, Series Due 1982, Series Due 1984, Series Due
1993, Series Due 1997, Series Due 1998, Series Due 1999, or Series Due 2000
remain outstanding and the amendments contained in said Fifteenth Supplemental
Indenture that did not theretofore become effective by virtue of the Sixteenth
Supplemental Indenture have become effective; and

WHEREAS, said
Forty-Second Supplemental Indenture, which created the 51¤8%
Series Due 2013, provided in its Article Two for certain amendments to the
First Mortgage, as theretofore amended, to become effective on the earliest
date on which either (i) there shall not be any Bonds outstanding of 6.35%
Series Due 2007, Pollution Control Series 1992-A Due 2027, Pollution Control
Series 1992-B Due 2027, Pollution Control Series 1992-C Due 2022, Series Due
2026 and Series Due 2024, or (ii) there shall have been executed and
delivered a supplemental indenture or indentures embodying said amendment
(either alone or with other amendments) consented to by the holders of seventy-five
per centum (75%) in aggregate principal amount of the Bonds at the time
outstanding of the series enumerated in the foregoing clause (i); and

WHEREAS, none of the Bonds of 6.35% Series Due 2007,
Pollution Control Series 1992-A Due 2027, Pollution Control Series 1992-B Due
2027, Pollution Control Series 1992-C Due 2022, Series Due 2026 and Series Due
2024 remain outstanding and the amendments contained in said Forty-Second
Supplemental Indenture have become effective; and

  WHEREAS, the
First Mortgage as amended by the First through the Forty-Third Supplemental
Indentures is hereinafter called the First Mortgage as amended; and

 5
 

 

WHEREAS, it is provided in Article Seven of the First
Mortgage as amended, among other things, that the Company may issue additional
Bonds thereunder upon the deposit with the Trustee of cash equal to the
principal amount of such additional Bonds to be issued; it is provided in
Article Six of the First Mortgage as amended, among other things, that if Bonds
are paid, retired, redeemed, canceled or surrendered to the Trustee for
cancellation (except when canceled pursuant to certain provisions of the First
Mortgage as amended), the Company may issue additional Bonds thereunder in
principal amount equivalent to the principal amount of the Bonds so paid,
retired, redeemed, canceled or surrendered to the Trustee for cancellation; it
is provided in Article Five of the First Mortgage as amended, among other
things, that the Company may issue additional Bonds thereunder upon the basis
of property additions in accordance with and subject to the conditions,
provisions and limitations set forth in said Article Five; and it is provided
in Article Eighteen of the First Mortgage as amended, among other things, that
the Company and the Trustee may from time to time enter into one or more
indentures supplemental to the First Mortgage as amended for the purposes,
among other things which may be therein set forth, to mortgage or pledge
additional property under the First Mortgage as amended and to establish the
terms and provisions of any series of Bonds other than the Series Due 1960; and

WHEREAS, the Company, pursuant to resolutions duly
adopted by its Board of Directors at a meeting of said Board of Directors duly
called and held, has determined under and in accordance with the provisions of
the First Mortgage as amended and of this Forty-Fourth Supplemental Indenture
to create a new series of Bonds to be known as its First Mortgage Bonds, 4.80%
Pollution Control Series 2006 Due 2036 (hereinafter sometimes called the New
Bonds), which shall be limited to the aggregate principal amount of
$100,000,000; and

WHEREAS,
the New Bonds are to be issued by the Company to the Ohio Air Quality
Development Authority (hereinafter called the Authority), or its assignee, to
evidence and secure the obligations of the Company to repay the loan of the
proceeds of the sale of the Project Bonds (as hereinafter defined) made by the
Authority to the Company, pursuant to a certain Loan Agreement, dated as of
September 1, 2006, between the Authority and the Company (hereinafter called
the Loan Agreement), to assist in the financing of the Company’s portion of the
cost of acquisition, construction and installation of certain “air quality
facilities” (as that term is defined and used in Section 3706.01, of the Ohio
Revised Code) installed in connection with: Units 7 and 8 at the Miami Fort
Generating Station located in Hamilton County, Ohio as to which the Company at
the date hereof owns an undivided 36% interest as tenant in common with another
public utility company, Unit 2 at the Killen Generating Station located in
Adams County, Ohio as to which the Company at the date hereof owns an undivided
67% interest as tenant in common with another public utility company, Units 1-4
at the J. M. Stuart Generating Station located in Brown and Adams Counties,
Ohio as to which the Company at the date hereof owns an undivided 35% interest
as tenant in common with two other public utility companies, and Unit 4 at the
Conesville Generating Station in Coshocton County, Ohio as to which the Company
at the date hereof owns an undivided 16.5% interest as tenant in common with
two other public utility companies (such interests in said facilities being
hereinafter called the Project); and

WHEREAS,
the loan by the Authority in respect of the Project is to be funded by the
proceeds derived from the sale by the Authority of State of Ohio Collateralized
Air Quality 

 6
 

 

Development
Revenue Bonds, 2006 Series A (The Dayton Power and Light Company Project), in the
aggregate principal amount of $100,000,000 (hereinafter called the Project
Bonds); and

WHEREAS, the Project Bonds are to be issued under a
certain Trust Indenture, dated as of September 1, 2006 (hereinafter called the
Project Bonds Indenture), between the Authority and The Bank of New York, as
Trustee (hereinafter in such capacity called the Project Bond Trustee), and the
New Bonds are to be assigned by the Authority to the Project Bond Trustee as
security for the payment of the principal of and interest on the Project Bonds
and are to be delivered by the Company on behalf of the Authority directly to
the Project Bond Trustee; and

WHEREAS, the New Bonds and the Trustee’s certificate
to be endorsed on all the New Bonds are to be respectively and substantially in
the forms established hereby and approved by the aforesaid resolutions, which
are substantially in the form of Exhibit A hereto; and

WHEREAS, at a meeting of the Board of Directors of the
Company, the Board of Directors adopted a resolution that authorized officers
of the Company to approve the form, terms and provisions of this Forty-Fourth
Supplemental Indenture (including the form of the New Bonds), and the execution
by the Company of this Forty-Fourth Supplemental Indenture; and

WHEREAS, all things necessary to make the New Bonds
hereinafter described, when duly authenticated by the Trustee and issued by the
Company, valid, binding and legal obligations of the Company, and to make this
Indenture a valid and binding agreement supplemental to the First Mortgage as
amended, have been done and performed.

NOW, THEREFORE, THIS INDENTURE WITNESSETH

that, in order further to secure the payment of all
the Bonds at any time issued and outstanding under the First Mortgage as
amended or this Forty-Fourth Supplemental Indenture according to their tenor,
purport and effect, as well the interest thereon as the principal thereof, and
further to secure the performance and observance of all the covenants and
conditions therein and in the First Mortgage as amended and herein contained,
and further to set forth the terms and conditions upon which the New Bonds are
to be issued, secured and held, and for and in consideration of the premises
and of the acceptance or purchase of the New Bonds by the holders or registered
owners thereof, and of the sum of one dollar, lawful money of the United States
of America, to the Company duly paid by the Trustee at or before the ensealing
and delivery of this Forty-Fourth Supplemental Indenture, the receipt whereof
is hereby acknowledged, the Company has executed and delivered this
Forty-Fourth Supplemental Indenture, and has granted, bargained, sold,
released, conveyed, assigned, transferred, pledged, set over and confirmed, and
by these presents does grant, bargain, sell, release, convey, assign, transfer,
pledge, set over and confirm unto the Trustee, and to its successor or
successors in said trust, and to it and its and their assigns forever, and does
hereby subject to the lien of the First Mortgage as heretofore and hereby amended
all the following described properties (all of which properties are included in
and constitute a part of the “mortgaged property” and the “mortgaged and
pledged property” as such terms are used and defined in the First Mortgage as
heretofore and hereby amended and whenever used in the First Mortgage as
heretofore and hereby amended such terms include and refer to such properties),
to wit:

 7
 

 

FIRST.

REAL
PROPERTY AND INTERESTS IN REAL PROPERTY.

All and singular, all real property and interests in
real property acquired by the Company between August 1, 2005, the date of the
Forty-Third Supplemental Indenture, and the date of this Forty-Fourth
Supplemental Indenture, and owned by the Company at the latter date.

SECOND.

ELECTRIC
GENERATING PLANTS.

All electric generating plants and stations of the
Company acquired by it between August 1, 2005, the date of the Forty-Third
Supplemental Indenture, and the date of this Forty-Fourth Supplemental
Indenture, and owned by it at the latter date, including all power houses,
buildings, structures and works, and the land on which the same are situated,
and all other lands and easements, rights-of-way, permits, privileges, towers,
poles, wires, machinery, equipment, appliances, appurtenances and supplies
forming a part of such plants and stations, or any of them, or occupied,
enjoyed or used in connection therewith.

THIRD.

TRANSMISSION
LINES.

All electric overhead and underground transmission
lines of the Company acquired by it between August 1, 2005, the date of the
Forty-Third Supplemental Indenture, and the date of this Forty-Fourth
Supplemental Indenture, and owned by it at the latter date, including towers,
poles, pole lines, conduits, manholes, switching devices, insulators, and other
structures, appliances, devices and equipment, and all the property forming a
part thereof or appertaining thereto, and all service lines extending
therefrom, together with all real property, rights-of-way, easements, permits,
privileges, franchises, and rights for or relating to the construction,
maintenance or operation thereof, through, over, under or upon any private
property or any public way within as well as without the corporate limits of
any municipal corporation.

FOURTH.

SUBSTATIONS
AND SUBSTATION SITES.

All substations and switching stations of the Company
acquired by it between August 1, 2005, the date of the Forty-Third Supplemental
Indenture, and the date of this Forty-Fourth Supplemental Indenture, and owned
by it at the latter date, for transforming or otherwise regulating electric
current at any of its plants, together with all buildings, transformers, wires,
cables, insulators, structures, appliances, devices, equipment and all other
property, real or personal, forming a part of, or appertaining thereto, or
used, occupied or enjoyed in connection with any of such substations and
switching stations.

 8
 

 

FIFTH.

ELECTRIC
DISTRIBUTION SYSTEMS.

All electric distribution systems of the Company
acquired by it between August 1, 2005, the date of the Forty-Third Supplemental
Indenture, and the date of this Forty-Fourth Supplemental Indenture, and owned
by it at the latter date, including substations, transformers, switchboards,
towers, poles, wires, insulators, conduits, cables, manholes, appliances,
devices, equipment and all other property, real or personal, forming a part of
or appertaining thereto, or used, occupied or enjoyed in connection with such
distribution systems or any of them, together with all rights-of-way,
easements, permits, privileges, franchises, and rights in or relating to the
construction, maintenance or operation thereof, through, over, under or upon
any private property or public ways within as well as without the corporate
limits of any municipal corporation.

SIXTH.

LIQUEFIED
PETROLEUM GAS PRODUCTION AND STORAGE FACILITIES.

All additions to liquefied petroleum gas production
plants and storage facilities of the Company acquired by it between August 1,
2005, the date of the Forty-Third Supplemental Indenture, and the date of this
Forty-Fourth Supplemental Indenture, and owned by it at the latter date,
including all buildings, structures, underground storage caverns, and works,
and the land on which the same are situated, and all other lands and easements,
rights-of-way, permits, privileges, pipe lines, machinery, equipment,
appliances, appurtenances and supplies forming a part of such plants and
stations, or any of them, or occupied, enjoyed or used in connection therewith.

SEVENTH.

GAS
DISTRIBUTION SYSTEMS.

All gas distribution systems of the Company acquired
or constructed by it between August 1, 2005, the date of the Forty-Third
Supplemental Indenture, and the date of this Forty-Fourth Supplemental
Indenture, and owned by it at the latter date, for distribution of gas,
including pipes, mains, conduits, meters, appliances, equipment, and all other
property, real or personal, forming a part of or appertaining to or used,
occupied or enjoyed in connection with such distribution systems, or any of
them, together with all rights-of-way, easements, permits, privileges, franchises
and rights, for or relating to the construction, maintenance or operation
thereof, through, over, under or upon any private property or any public
streets or highways, within as well as without the corporate limits of any
municipal corporation.

 9

 

EIGHTH.

OFFICE
AND DEPARTMENTAL BUILDINGS.

All office and departmental buildings of the Company,
including the real estate on which such structures stand, acquired by it
between August 1, 2005, the date of the Forty-Third Supplemental Indenture, and
the date of this Forty-Fourth Supplemental Indenture, and owned by it at the
latter date, appertaining to, used, occupied or enjoyed in connection with the
rendition of public utility service.

NINTH.

TELEPHONE
LINES.

All telephone lines of the Company acquired by it
between August 1, 2005, the date of the Forty-Third Supplemental Indenture, and
the date of this Forty-Fourth Supplemental Indenture, and owned by it at the
latter date, used or available for use in the operation of its properties or
otherwise.

TENTH.

FRANCHISES.

All and singular the franchises, grants, immunities,
privileges and rights of the Company granted to or acquired by it between
August 1, 2005, the date of the Forty-Third Supplemental Indenture, and the
date of this Forty-Fourth Supplemental Indenture, and to which it was entitled
at the latter date, including all and singular the franchises, grants,
immunities, privileges and rights of the Company granted by all municipalities
or political subdivisions, and all right, title and interest therein owned by
the Company on the date of the execution of this Forty-Fourth Supplemental
Indenture, and all renewals, extensions and modifications of said franchises,
grants, immunities, privileges and rights, or any of them, and of all other
franchises, grants, immunities, privileges and rights now subject to the lien
of the First Mortgage as amended.

ELEVENTH.

OTHER
REAL ESTATE AND APPURTENANCES.

A.            All
other real estate and interests in real estate and all other physical electric
power and light, gas and other property owned by the Company at the date of
execution of this Forty-Fourth Supplemental Indenture.

B.            All
other real estate and interests in real estate and all other physical electric
power and light, gas and other property which the Company may hereafter acquire
or construct.

C.            All
present and future appurtenances of the real estate and interests in real
estate which now are, or hereafter shall be, subject to the lien of the First
Mortgage as amended, and all plants, works, buildings, structures, fixtures,
improvements, betterments and additions now owned, or hereafter acquired or
constructed by the Company, upon any of the real estate which, 

 10
 

 

or interests in which,
now are or hereafter shall be subject to the lien of the First Mortgage as
amended.

D.            All
corporate rights, privileges, immunities and franchises, powers, licenses,
easements, leases, contracts and other rights and all renewals and extensions
thereof held or acquired for use or used upon, or in connection with or
appertaining to, any of the properties which now are or hereafter shall be
subject to the lien of the First Mortgage as amended, or which the Company has
or may have the right to exercise in respect of any of said properties.

E.             All
machinery, tools and equipment now owned or hereafter acquired by the Company,
which now or hereafter belong or appertain to or are used in connection with
the plants, works, transmission lines, distribution systems, buildings,
structures and fixtures which now are or hereafter shall be subject to the lien
of the First Mortgage as amended.

Together with all and singular the tenements,
hereditaments and appurtenances belonging or in any way appertaining to the
aforesaid property or any part thereof, with the reversion and reversions,
remainder and remainders, rents, issues, income and profits thereof, and all
the estate, right, title, interest and claim whatsoever at law or in equity,
which the Company now has or which it may hereafter acquire in and to the
aforesaid property and every part and parcel thereof.

It is not intended to include in the lien of the First
Mortgage as amended and this grant shall not be deemed to apply (1) to any
revenues, earnings, rents, issues, income or profits of the mortgaged property,
or any cash (except cash deposited with the Trustee pursuant to any of the
provisions of the First Mortgage as heretofore and hereby amended), or any
bills, notes or accounts receivable, contracts or choses in action, or any
materials or supplies or construction equipment, or any merchandise, equipment
or apparatus manufactured or acquired for the purpose of sale or resale in the
usual course of business, except in case of the happening of a completed
default as defined in Section 1 of Article Twelve of the First Mortgage as
heretofore and hereby amended, and following such completed default, in case
the Trustee or a receiver or trustee shall enter upon and take possession of
the mortgaged property, or (2) in any case, to any cars, trucks or other
vehicles of any nature for the transportation of personnel, materials or
equipment by any means which may have been acquired after the effective date of
the amendment to this Clause made by or pursuant to the provisions of the
Eleventh Supplemental Indenture, or to any bonds, notes, evidences of indebtedness,
shares of stock or other securities, except such as may be specifically
subjected to the lien of the First Mortgage as amended.

TWELFTH.

PROPERTY
HEREAFTER TO BECOME SUBJECT TO THE LIEN OF

THE FIRST MORTGAGE AS AMENDED.

A.            Any
and all property, real, personal and mixed, including franchises, grants,
immunities, privileges and rights, which the Company may hereafter acquire or
to which it may hereafter become entitled, excepting, however, the following
property which is not intended to be subjected to the lien of the First
Mortgage:  (1) any revenues,
earnings, rents, issues, income or profits of the mortgaged property, or any
cash (except cash deposited with the Trustee pursuant to any of the provisions
of the First Mortgage as heretofore and hereby amended), or 

 11
 

 

any bills, notes or
accounts receivable, contracts or choses in action, or any materials or
supplies or construction equipment, or any merchandise, equipment or apparatus
manufactured or acquired for the purpose of sale or resale in the usual course
of business, except in case of the happening of a completed default as defined
in Section 1 of Article Twelve of the First Mortgage as heretofore and
hereby amended, and following such completed default, in case the Trustee or a
receiver or trustee shall enter upon and take possession of the mortgaged
property, or (2) in any case, any cars, trucks or other vehicles of any
nature for the transportation of personnel, materials or equipment by any
means, or any bonds, notes, evidences of indebtedness, shares of stock or other
securities, except such as may be specifically subjected to the lien of the
First Mortgage as amended.

B.            Any
and all property of every name and nature, including shares of stock, bonds,
other securities or obligations and cars, trucks or other vehicles for the
transportation of personnel, materials or equipment by any means, which, from
time to time after the execution of this Forty-Third Supplemental Indenture, by
delivery or by writing of any kind for the purposes hereof, shall have been
conveyed, mortgaged, pledged, assigned or transferred by, or by anyone on
behalf of, the Company to the Trustee, which is hereby authorized to receive
any property at any and all times, as and for additional security, and also,
when and as provided in the First Mortgage as amended as and for substituted
security, for the payment of the Bonds to be issued under the First Mortgage as
amended, and to hold and apply any and all such property subject to the terms
hereof and of the First Mortgage as amended.

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

SUBJECT, HOWEVER, as to property hereby conveyed, to
liens for taxes, assessments and other charges levied or to be levied by the
State of Ohio and any of the subdivisions thereof for the years 2005 and 2006
and thereafter and, as to any property hereafter acquired by the Company and
which may become subject to the lien of the First Mortgage as amended, to any
lien or charge thereon existing at the time of the acquisition thereof by the
Company;

IN TRUST NEVERTHELESS, upon and subject to the terms,
conditions and stipulations hereinafter and in the First Mortgage as amended
set forth, for the equal and proportionate benefit and security of the holders
from time to time of the Bonds and interest coupons issued and to be issued
under the First Mortgage as amended and this and other indentures supplemental thereto,
without preference, priority or distinction as to lien or otherwise of any of
the Bonds and coupons over any others by reason of priority in time of issue,
sale or negotiation thereof or otherwise howsoever, and for the uses and
purposes and upon and subject to the terms, conditions, provisions and
agreements in the Bonds and hereinafter and in the First Mortgage as amended
expressed and declared.

 12
 

 

ARTICLE ONE.

BONDS OF THE 4.80% POLLUTION CONTROL SERIES
2006 DUE 2036 AND

ISSUE THEREOF.

SECTION 1.           There shall
be a series of Bonds designated “4.80% Pollution Control Series 2006 Due 2036”,
each of which shall bear the descriptive title First Mortgage Bond.  The aggregate principal amount of New Bonds
which may be outstanding under the First Mortgage as amended and this
Forty-Fourth Supplemental Indenture shall be limited to $100,000,000, except as
provided in Section 9 of Article Two of the First Mortgage as amended.

SECTION 2.           Upon the
execution and delivery of this Forty-Fourth Supplemental Indenture and upon
delivery of $100,000,000 aggregate principal amount of the New Bonds, executed
by the Company, and upon compliance by the Company with the provisions of
Article Five, Article Six or Article Seven or any or all of said Articles, as
the case may be, of the First Mortgage as amended, the Trustee shall, without
awaiting the filing or recording of this Forty-Fourth Supplemental Indenture,
authenticate the New Bonds and deliver the New Bonds as provided in said
Article Five, Article Six or Article Seven.

SECTION 3.           The New Bonds
shall be dated as provided in Section 3 of Article Two of the First Mortgage as
amended; shall mature on September 1, 2036; and shall bear interest from
September 13, 2006 as provided in said Section 3 of Article Two at the rate of
four and eighty hundredths per centum (4.80%) per annum until paid or redeemed
as hereinafter provided, payable on March 1, 2007 and thereafter semi-annually
on each March 1 and September 1, and on the maturity date, to the Bondholders
in whose names such New Bonds are registered at the close of business on
February 15 or August 15, except that if the Company shall default in the
payment of any installment of interest on any New Bonds, such interest in
default shall be paid to the Bondholders in whose names the New Bonds are
registered at the close of business on a date established for the payment of
such defaulted interest by the Company in any lawful manner.  The New Bonds shall be payable as to both
principal and interest in such coin or currency of the United States of America
as at the time of payment is legal tender for the payment of public and private
debts, at the office or agency of the Company in the Borough of Manhattan, The
City of New York.  The amount of interest
payable for any period will be computed on the basis of a 360-day year
consisting of twelve 30-day months.  In
the event that any date on which principal or interest is payable on the New
Bonds is not a Business Day (as defined below), the payment of the principal or
interest payable on such date will be made on the next succeeding day which is
a Business Day (and without any interest or other payment in respect of any
such delay), with the same force and effect as if made on the date the payment
was originally payable.  “Business Day”
means any day, other than a Saturday or Sunday, or a day on which banking
institutions or trust companies in The City of New York are generally
authorized or required by law, regulation or executive order to remain closed
or a day on which the corporate trust office of the Trustee is closed for
business.

 13
 

 

SECTION 4.           The New Bonds
shall be issued in denominations of $5,000 and any integral multiple of $5,000.

Whenever any New Bond or New Bonds shall be
surrendered at the office or agency of the Company in said Borough of Manhattan
for exchange for a New Bond or New Bonds of other authorized denomination or
denominations, the Company shall execute, and the Trustee shall authenticate
and deliver, upon cancellation of the New Bond or New Bonds so surrendered, a
New Bond or New Bonds of such other authorized denomination or denominations of
like aggregate principal amount as the Bondholder making the exchange shall
have requested and shall be entitled to receive.  On presentation of any New Bond which is to
be redeemed pursuant to the provisions of Section 5 of this Article One in part
only, the Company shall execute, and the Trustee shall authenticate and
deliver, a New Bond or New Bonds in principal amount equal to the unredeemed
portion of the New Bond so presented.

The Company shall not be required to (a) register
a transfer of, or exchange, any New Bond during a period of fifteen (15) days
next preceding any selection of New Bonds to be redeemed or (b) register a
transfer of, or exchange, any New Bond which shall have been selected for
redemption in whole or in part.

A service charge will not be made for any registration
of transfer or exchange of New Bonds, but the Company may require payment of a
sum sufficient to cover any stamp tax or other governmental charge payable in
connection therewith.

Until definitive New Bonds shall be ready for
delivery, the Company may execute and, upon request of the Company, the Trustee
shall authenticate and deliver, in lieu of such definitive New Bonds but
subject to the same provisions, limitations and conditions except as to the
denominations thereof, temporary printed or lithographed New Bonds as provided
in Section 8 of Article One of the First Mortgage as amended.  Such temporary New Bonds shall be
exchangeable for definitive New Bonds, when ready for delivery, in the manner
provided in the First Mortgage as amended, and shall in all other respects be
subject to and entitled to the benefits of the terms and provisions and lien of
this Forty-Fourth Supplemental Indenture, and the terms and provisions and lien
of the First Mortgage as amended as therein provided.

SECTION 5.           The New Bonds
shall be subject to mandatory redemption by the Company prior to maturity at
any time in whole or in part at a redemption price of 100% of the principal
amount to be redeemed, plus accrued and unpaid interest to the redemption date,
upon receipt by the Trustee of notice from the Project Bond Trustee to the
effect that (a) the Company is required to deliver moneys to the Project Bond
Trustee for the redemption of the Project Bonds in whole or in part, as the
case may be, as provided in Section 6.3 of the Loan Agreement and (b) an
equivalent principal amount of the Project Bonds are being concurrently called
for redemption.  Said notice shall specify
the redemption date of such New Bonds (which redemption date shall be the same
date as the redemption date specified in said notice for the Project Bonds
being currently redeemed).  Any such
redemption shall be made upon the notice and in the manner provided in this
Article One, subject to the provisions of the First Mortgage as amended.

 14
 

 

SECTION 6.           The New Bonds
shall be subject to redemption, at the option of the Company, prior to maturity
at any time, in whole or in part, at a redemption price of 100% of the
principal amount to be redeemed, plus accrued and unpaid interest to the
redemption date, upon receipt by the Trustee of an officers’ certificate to the
effect that (a) the Company has given notice to the Project Bond Trustee that
the Company is exercising its option to direct the redemption of Project Bonds
in whole or in part, as provided in Section 6.2 of the Loan Agreement and (b)
an equivalent principal amount of New Project Bonds are being concurrently
called for redemption.  Such officers’ certificate
shall have attached to it a copy of said notice to the Project Bond Trustee and
shall specify the redemption date of such New Bonds (which redemption date
shall be not less than 45 days (unless a shorter period shall be acceptable to
the Trustee) after the date of the mailing of such certificate and shall be the
same date as the redemption date specified in said attached notice for the
Project Bonds being concurrently redeemed). 
Any such redemption shall be made upon the notice, which may be conditional
as provided in Section 8 of this Article One, and in the manner provided in
this Article One, subject to the provisions of the First Mortgage as amended.

SECTION 7.           The New Bonds
shall also be subject to redemption prior to maturity, at the option of the
Company, in whole or in part, at anytime on or after September 1, 2016, at a
redemption price equal to 100% of the principal amount thereof, plus accrued
and unpaid interest to the redemption date.

Prior to any such
redemption, the Trustee shall have received an officers’ certificate to the
effect that (a) the Company has given notice to the Project Bond Trustee that
the Company is exercising its option to deliver moneys to the Project Bond
Trustee for the redemption of Project Bonds in whole or in part, as the case
may be, as provided in Section 6.1 of the Loan Agreement and (b) an equivalent
principal amount of Project Bonds are being concurrently called for
redemption.  Such officers’ certificate
shall specify the principal amount of the New Bonds to be redeemed, shall have
attached to it a copy of said notice to the Project Bond Trustee and shall
specify the redemption date of such New Bonds (which redemption date shall be
not less than 45 days (unless a shorter period shall be acceptable to the Trustee)
after the date of the mailing of such certificate and shall be the same date as
the redemption date specified in said attached notice for the Project Bonds
being concurrently redeemed).  Any such
redemption shall be made upon the notice, which may be conditional as provided
in Section 8 of this Article One, and in the manner provided in this Article
One, subject to the provisions of the First Mortgage as amended.

SECTION 8.           Subject to
the provisions of the First Mortgage as amended, written notice of redemption
of the New Bonds pursuant to any of Sections 5, 6 or 7 of this Article One
shall be given by the Trustee by mailing, first class postage prepaid, or
delivering by hand to the registered owner of such New Bonds to be redeemed a
notice of such redemption at its last address as it shall appear upon the books
of the Company for the registration and transfer of such New Bonds.  Any notice of redemption pursuant to said
Sections 5, 6 or 7 shall be mailed or delivered by hand as least 30 days and
not earlier than 60 days before the redemption date; provided, however, that
the registered owner or owners of all New Bonds may consent in writing to a
shorter notice period, and 

 15
 

 

such consent,
if filed with the Trustee, shall be binding upon the Company and such
registered owners and their transferees. 
In the case of any notice of redemption of New Bonds pursuant to said
Sections 6 or 7, such notice shall state that such redemption is conditional to
the same extent and with the same effect, if any, as the notice of redemption
of the Project Bonds being concurrently redeemed.

SECTION 9.           In the event
any Project Bonds shall be purchased by the Company and surrendered by the
Company to the Project Bond Trustee for cancellation or shall be otherwise
surrendered to the Project Bond Trustee for cancellation pursuant to the
Project Bonds Indenture (except upon exchange for other Project Bonds), New
Bonds equivalent in principal amount to the Project Bonds so surrendered shall
be deemed to have been paid, but only when and to the extent that (a) such
payment of the principal amount of such New Bonds shall be noted by an agency
of the Company on the schedule of payments on such New Bonds and (if such
agency is not the Trustee) written notice by such agency of such notation shall
have been received by the Trustee or (b) such New Bonds shall have been
surrendered to and cancelled by the Trustee as provided in Section 11 of this
Article One.

SECTION 10.         In the event
and to the extent the principal of or interest on any Project Bonds shall be
paid, whether at maturity, upon redemption or otherwise, out of funds held by
the Project Bond Trustee or out of any other funds or shall otherwise be deemed
to be paid, an equal amount of principal or interest, as the case may be, payable
with respect to an aggregate principal amount of New Bonds equal to an
aggregate principal amount of such Project Bonds shall be deemed to have been
paid, but, in the case of such payment of principal of such New Bonds, only
when and to the extent that (a) such payment of the principal amount thereof
shall be noted by any agency of the Company on the schedule of payments on such
New Bonds and (if such agency is not the Trustee) written notice by such agency
of such notation shall have been received by the Trustee or (b) such New Bonds
shall have been surrendered to and cancelled by the Trustee as provided in
Section 11 of this Article One.

SECTION 11.         When payment
of any principal amount of a New Bond is made as provided in Section 9 or 10 of
this Article One, the registered owner thereof shall surrender it to an agency
of the Company for notation and notification or to the Trustee for cancellation
as provided in such Section.  All New
Bonds deemed to have been paid in full as provided in Section 9 or 10 of this
Article One shall be surrendered to the Trustee for cancellation and the
Trustee shall forthwith cancel the same. 
In the event that part of a New Bond shall be deemed to have been paid
as provided in said Section 9 or 10, the registered owner may at its option
surrender such New Bond to the Trustee for cancellation, in which event the
Trustee shall cancel such New Bond and the Company shall execute and the
Trustee shall authenticate and deliver, without charge to the registered owner,
New Bonds in such authorized denominations as shall be specified by the
registered owner in an aggregate principal amount equal to the unpaid balance
of the principal amount of such surrendered New Bond.

SECTION 12.         Except as in
this Forty-Fourth Supplemental Indenture otherwise provided with respect to any
matter or question, the provisions of Article Ten of the First 

 16
 

 

Mortgage as
amended shall be applicable in the case of the redemption of all or any part of
the New Bonds at any time outstanding. 
The term “officers’ certificate as used in this Article One shall mean a
certificate signed by the President or a Vice President and any other Vice
President, the Treasurer, Assistant Treasurer, the Secretary or Assistant
Secretary or any other officer of the Company.

SECTION 13.         The New Bonds shall be in fully
registered form only.  The form of the
New Bonds, and of the Trustee’s certificate of authentication thereon, shall be
substantially as set forth in Exhibit A.

ARTICLE TWO.

COVENANTS OF THE COMPANY.

SECTION 1.           All covenants
and agreements by the Company in the First Mortgage as heretofore and hereby
amended are hereby confirmed.

SECTION 2.           Promptly
after the execution and delivery of this Forty-Fourth Supplemental Indenture,
the Company will take such action with respect to the recording, filing,
re-recording and refiling of the First Mortgage as amended and this
Forty-Fourth Supplemental Indenture as may be necessary to make effective the
lien intended to be created hereby, and will furnish to the Trustee an opinion of
counsel selected by the Company and satisfactory to the Trustee (who may be of
counsel to the Company) either (a) stating that in the opinion of such
counsel such action has been taken with respect to the recording, filing,
re-recording and refiling of the First Mortgage as amended and this
Forty-Fourth Supplemental Indenture as to make effective the lien intended to
be created thereby, and reciting the details of such action, or
(b) stating that in the opinion of such counsel no such action is necessary
to make such lien effective.

ARTICLE THREE.

MISCELLANEOUS.

SECTION 1.           The New Bonds
may be authenticated and delivered by the Trustee and issued by the Company in
advance of the recording or filing of this Forty-Fourth Supplemental Indenture.

SECTION 2.           The
provisions of this Forty-Fourth Supplemental Indenture shall become effective
immediately upon the execution and delivery hereof.  From and after the initial issue of the New
Bonds, this Forty-Fourth Supplemental Indenture shall form a part of the First
Mortgage and all the terms and conditions herein contained shall be deemed to
be part of the terms of the First Mortgage, as fully and with the same effect
as if all the terms and provisions of this Forty-Fourth Supplemental Indenture,
including the provisions which determine the dates on which the amendments
herein made shall become effective, had been set forth in the First Mortgage as
originally executed.  Except as modified
or amended by this Forty-Fourth Supplemental Indenture, the First Mortgage 

 17
 

 

as amended
shall remain and continue in full force and effect in accordance with the terms
and provisions thereof, and all the covenants, conditions, terms and provisions
of the First Mortgage, as heretofore modified and amended and as further
modified and amended by this Forty-Fourth Supplemental Indenture, shall be
applicable with respect to the New Bonds, except insofar as such covenants,
conditions, terms and provisions are limited and applicable only to the Bonds
of another or other series, or are expressed to continue only so long as Bonds
of another or other series are outstanding, and all the covenants, conditions,
terms and provisions of the First Mortgage as amended with respect to the
Trustee shall remain in full force and effect and be applicable to the Trustee
under this Forty-Fourth Supplemental Indenture in the same manner as though set
out herein at length.  All
representations and recitals contained in this Forty-Fourth Supplemental
Indenture and in the New Bonds (save only the Trustee’s certificates upon said
New Bonds) are made by and on behalf of the Company, and the Trustee is in no
way responsible therefor or for any statement therein contained.

SECTION 3.           The terms
defined in Article One of the First Mortgage as heretofore and hereby amended,
when used in this Forty-Fourth Supplemental Indenture, shall, respectively,
have the meanings set forth in said Article One.

SECTION 4.           This
Forty-Fourth Supplemental Indenture may be simultaneously executed in several
counterparts and each counterpart shall be an original instrument.

 18

 

IN WITNESS WHEREOF, THE DAYTON POWER AND LIGHT COMPANY
has caused this instrument to be signed on its behalf by its President or a
Vice President and its corporate seal to be hereunto affixed and attested by
its Secretary or an Assistant Secretary, in the City of Dayton, Ohio, and THE
BANK OF NEW YORK has caused this instrument to be signed on its behalf by a
Vice President or an Assistant Vice President and its corporate seal to be
hereunto affixed and attested by a Vice President, Assistant Vice President or
an Assistant Treasurer, in The City of New York, New York, as of the day and
year first above written.

 

	
  

  	
  THE DAYTON POWER AND LIGHT

  
	
   

  	
  COMPANY

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ John J. Gillen

  	
   

  
	
   

  	
   

  	
  John J. Gillen

  	
   

  
	
   

  	
   

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
  and Chief Financial Officer

  	
   

  

 

[SEAL]

Attest:

 

	
  /s/ Miggie E. Cramblit

  	
   

  
	
  Miggie E. Cramblit

  	
   

  
	
  Vice President, General Counsel

  
	
  and Corporate Secretary

  
	
   

  
	
   

  
	
  Signed and acknowledged in our presence by

  
	
  The Dayton Power and Light Company

  
	
   

  
	
   

  
	
  /s/ Timothy G. Rice

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Charles J. Hofmann Jr.

  	
   

  
			

 

 

[Forty-Fourth
Supplemental Indenture, dated as of September 1, 2006, to Indenture dated as of
October 1, 1935, executed by The Dayton Power and Light Company to Irving Trust
Company (now The Bank of New York), as Trustee]

 

	
  

  	
  THE BANK OF NEW YORK,

  
	
   

  	
     as Trustee

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Louis P. Young

  	
   

  
	
   

  	
   

  	
  Louis P. Young

  	
   

  
	
   

  	
   

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
  [SEAL]

  	
   

  
	
  Attest:

  	
   

  
	
   

  	
   

  
	
  /s/ Franca Ferrara

  	
   

  
	
  Franca Ferrara

  	
   

  
	
  Assistant Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signed and acknowledged in our presence by

  	
   

  
	
  The Bank of New York

  	
   

  
	
   

  	
   

  
	
  /s/ Mary LaGumina

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Alexander Pabone

  	
   

  
						

 

 

 

	
  STATE OF OHIO,

  	
  )

  	
  ss.:

  
	
  COUNTY OF MONTGOMERY

  	
  )

  	
   

  

 

On this 11 day of September, 2006, personally appeared
before me, a Notary Public within and for said County in the State aforesaid,
John J. Gillen, and Miggie E. Cramblit, to me known and known to me to be,
respectively, the Senior Vice President and Chief Financial Officer and the
Vice President, General Counsel and Corporate Secretary of THE DAYTON POWER AND
LIGHT COMPANY, one of the corporations which executed the foregoing instrument,
who severally acknowledged that they did sign and seal said instrument as such
Senior Vice President and Chief Financial Officer and Vice President, General
Counsel and Corporate Secretary for and on behalf of said corporation and that
the same is their free act and deed as such Senior Vice President and Chief
Financial Officer and Vice President, General Counsel and Corporate Secretary,
respectively, and the free and corporate act and deed of said corporation; and
said John J. Gillen, being by me duly sworn, did depose and say: that he
resides in Delaware County, Pennsylvania; that he is the Senior Vice President
and Chief Financial Officer of THE DAYTON POWER AND LIGHT COMPANY, one of the
corporations described in and which executed the above instrument; that he
knows the seal of said corporation; that the seal affixed to said instrument is
such corporate seal; that it was so affixed by order of the Board of Directors
of said corporation; and that he signed his name thereto by like order.

IN WITNESS WHEREOF I have hereunto set my hand and
official seal.

[SEAL]

	
  

  	
  /s/ Timothy G.
  Rice

  	
   

  
	
   

  	
  TIMOTHY G. RICE,
  Attorney at Law

  	
   

  
	
   

  	
  Notary Public,
  State of Ohio

  	
   

  
	
   

  	
  My Commission
  has no expiration date,

  	
   

  
	
   

  	
  Section 147.03
  O.R.C.

  	
   

  

 

 

 

	
  STATE OF NEW YORK,

  	
  )

  	
  ss.:

  
	
  COUNTY OF NEW YORK

  	
  )

  	
   

  

 

On this 8th day of September, 2006, personally
appeared before me, a Notary Public within and for said County in the State
aforesaid, Louis P. Young and Franca Ferrara, to me known and known to me to
be, respectively, a Vice President and an Assistant Vice President of THE BANK
OF NEW YORK, one of the corporations which executed the foregoing instrument,
who severally acknowledged that they did sign and seal said instrument as such
Vice President and Assistant Vice President for and on behalf of said
corporation and that the same is their free act and deed as such Vice President
and Assistant Vice President, respectively, and the free and corporate act and
deed of said corporation; and said Louis P. Young being by me duly sworn, did
depose and say: that he resides in Plainview, New York; that he is a Vice
President of THE BANK OF NEW YORK, one of the corporations described in and
which executed the above instrument; that he knows the seal of said
corporation; that the seal affixed to said instrument is such corporate seal;
that it was so affixed by order of the Board of Directors of such corporation;
and that he signed his name thereto by like order.

IN WITNESS WHEREOF I have hereunto set my hand and
official seal.

[SEAL]

	
  

  	
  /s/ Carlos R. Luciano

  	
   

  
	
   

  	
  Carlos R. Luciano

  	
   

  
	
   

  	
  Notary Public, State of New York

  	
   

  
	
   

  	
  No. 41-4765897

  	
   

  
	
   

  	
  Qualified in Queens County

  	
   

  
	
   

  	
  Commission Expires April 30, 2010

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  This instrument
  prepared by

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Timothy G. Rice

  	
   

  
	
   

  	
  Timothy G. Rice,
  Esq.

  	
   

  
	
   

  	
  Attorney at Law

  	
   

  
	
   

  	
  The Dayton Power
  and Light Company

  	
   

  
	
   

  	
  1065 Woodman
  Drive

  	
   

  
	
   

  	
  Dayton, Ohio
  45432Exhibit 10.18

 

 

PROMISSORY NOTE

 

	
  Amount $25,000.00

  	
   

  	
  August 23, 2002

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
Twenty Five Thousand Dollars ($25,000.00) with interest from August 23, 2002 at
a rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San Francisco,
California 94111 •
(415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $300,000.00

  	
   

  	
  March 1, 2002

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby promises
to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of Three
Hundred Thousand Dollars ($300,000.00) with interest from March 1, 2002 at a
rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San Francisco,
California 94111 •
(415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $35,000.00

  	
   

  	
  January 7, 2002

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
Thirty Five Thousand Dollars ($35,000.00) with interest from January 7, 2002 at
a rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San Francisco,
California 94111 •
(415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $20,000.00

  	
   

  	
  November 2, 2001

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
Twenty Thousand Dollars ($20,000.00) with interest from November 2, 2001 at a
rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San
Francisco, California 94111 • (415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $25,000.00

  	
   

  	
  August 23, 2001

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
Twenty Five Thousand Dollars ($25,000.00) with interest from August 23, 2001 at
a rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San
Francisco, California 94111 • (415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $30,000.00

  	
   

  	
  August 23, 2001

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of Thirty
Thousand Dollars ($30,000.00) with interest from August 23, 2001 at a rate of
eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San
Francisco, California 94111 • (415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $50,000.00

  	
   

  	
  August 22, 2001

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
Fifty Thousand Dollars ($50,000.00) with interest from August 22, 2001 at a
rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San
Francisco, California 94111 • (415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $100,000.00

  	
   

  	
  August 20, 2001

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
One Hundred Thousand Dollars ($100,000.00) with interest from August 20, 2001
at a rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San
Francisco, California 94111 • (415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $55,000.00

  	
   

  	
  August 17, 2001

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
Fifty Five Thousand Dollars ($55,000.00) with interest from August 17, 2001 at
a rate of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San
Francisco, California 94111 • (415) 398-8186 • FAX (415) 398-9227

 

 

 

PROMISSORY NOTE

 

	
  Amount $50,000.00

  	
   

  	
  July 19, 2001

  

 

For value
received, the undersigned, GeoPetro Resources Company (“Payor”), hereby
promises to pay on demand to Stuart J. Doshi (“Holder”) the principal sum of
Fifty Thousand Dollars ($50,000.00) with interest from July 19, 2001 at a rate
of eight percent (8%) per annum, payable upon repayment of the loan.

 

 

Signed by:

GeoPetro Resources Company

 

 

	
  /s/ J. Chris Steinhauser

  	
   

  
	
  J. Chris Steinhauser

  
	
  Chief Financial Officer

  

 

www.geopetro.com

One Maritime Plaza, Suite 400, San
Francisco, California 94111 • (415) 398-8186 FAX (415) 398-9227

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