Document:

Exhibit 4.6

 

 

 

 

THE DAYTON POWER AND LIGHT COMPANY

AND

THE BANK OF NEW YORK

(formerly Irving Trust Company)

Trustee

 

 

 

Forty-Third Supplemental Indenture

 

 

 

Dated as of August 1, 2005

 

 

 

 

THE DAYTON POWER AND LIGHT COMPANY

FORTY-THIRD SUPPLEMENTAL INDENTURE

DATED AS OF AUGUST 1, 2005

 

TABLE OF CONTENTS

 

	
   

  	
  Page

  
	
  Parties

  	
  1

  
	
   

  	
   

  	
   

  
	
  Recitals

  	
  1

  
	
   

  	
   

  	
   

  
	
  Granting Clauses

  	
  7

  
	
   

  	
   

  	
   

  
	
  First. Real
  Property and Interests in Real Property.

  	
  7

  
	
   

  	
   

  	
   

  
	
  Second. Electric
  Generating Plants.

  	
  7

  
	
   

  	
   

  	
   

  
	
  Third.
  Transmission Lines.

  	
  7

  
	
   

  	
   

  	
   

  
	
  Fourth. Substations
  and Substation Sites.

  	
  7

  
	
   

  	
   

  	
   

  
	
  Fifth. Electric
  Distribution Systems.

  	
  8

  
	
   

  	
   

  	
   

  
	
  Sixth. Liquefied
  Petroleum Gas Production and Storage Facilities.

  	
  8

  
	
   

  	
   

  	
   

  
	
  Seventh. Gas
  Distribution Systems.

  	
  8

  
	
   

  	
   

  	
   

  
	
  Eighth. Office
  and Departmental Buildings.

  	
  8

  
	
   

  	
   

  	
   

  
	
  Ninth. Telephone
  Lines.

  	
  9

  
	
   

  	
   

  	
   

  
	
  Tenth.
  Franchises.

  	
  9

  
	
   

  	
   

  	
   

  
	
  Eleventh. Other
  Real Estate and Appurtenances.

  	
  9

  
	
   

  	
   

  	
   

  
	
  Twelfth.
  Property Hereafter to Become Subject to the Lien of the First Mortgage as
  Amended.

  	
  10

  
	
   

  	
   

  	
   

  
	
  Habendum Clause

  	
  10

  
	
   

  	
   

  	
   

  
	
  Subject Clause

  	
  11

  
	
   

  	
   

  	
   

  
	
  Grant in Trust

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE ONE. Bonds of the 4.80% pollution
  control Series 2005-A Due 2034 and Issue Thereof.

  	
  11

  
	
   

  	
   

  
	
  Sec. 1.

  	
  Series and Form of
  New Water Bonds

  	
  11

  
	
  Sec. 2.

  	
  Issue of New Water
  Bonds

  	
  11

  
	
  Sec. 3.

  	
  Dates, Interest, etc.,
  of New Water Bonds

  	
  11

  
	
  Sec. 4.

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

  	
  12

  
	
  Sec. 5.

  	
  Mandatory Redemption of
  New Water Bonds and Redemption Price

  	
  13

  
	
  Sec. 6.

  	
  Extraordinary Optional
  Redemption of New Water Bonds and Redemption Price

  	
  13

  
	
  Sec. 7.

  	
  Optional Redemption of
  New Water Bonds and Redemption Price

  	
  13

  
	
  Sec. 8.

  	
  Notice of Redemption of
  New Water Bonds

  	
  14

  
	
  Sec. 9.

  	
  New Water Bonds Deemed
  Paid in Certain Circumstances

  	
  14

  
	
  Sec. 10.

  	
  New Water Bonds Deemed
  Paid in Additional Circumstances

  	
  14

  
	
  Sec. 11.

  	
  Surrender of New Water
  Bonds in Certain Circumstances

  	
  14

  
	
  Sec. 12.

  	
  Application of Article Ten
  of First Mortgage as Amended

  	
  14

  
	
  Sec. 13.

  	
  Form of New Water
  Bonds

  	
  15

  

 

i

 

	
  ARTICLE TWO. Bonds of the 4.80% pollution
  control Series 2005-B Due 2034 and Issue Thereof.

  	
  15

  
	
   

  	
   

  
	
  Sec. 1.

  	
  Series and Form of
  New Air Bonds

  	
  15

  
	
  Sec. 2.

  	
  Issue of New Air Bonds

  	
  15

  
	
  Sec. 3.

  	
  Dates, Interest, etc.,
  of New Air Bonds

  	
  15

  
	
  Sec. 4.

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

  	
  16

  
	
  Sec. 5.

  	
  Mandatory Redemption of
  New Air Bonds and Redemption Price

  	
  16

  
	
  Sec. 6.

  	
  Extraordinary Optional
  Redemption of New Air Bonds and Redemption Price

  	
  17

  
	
  Sec. 7.

  	
  Optional Redemption of New
  Air Bonds and Redemption Price

  	
  17

  
	
  Sec. 8.

  	
  Notice of Redemption of
  New Air Bonds

  	
  17

  
	
  Sec. 9.

  	
  New Air Bonds Deemed
  Paid in Certain Circumstances

  	
  18

  
	
  Sec. 10.

  	
  New Air Bonds Deemed
  Paid in Additional Circumstances

  	
  18

  
	
  Sec. 11.

  	
  Surrender of New Air
  Bonds in Certain Circumstances

  	
  18

  
	
  Sec. 12.

  	
  Application of Article Ten
  of First Mortgage as Amended

  	
  18

  
	
  Sec. 13.

  	
  Form of New Air
  Bonds

  	
  18

  
	
   

  	
   

  	
   

  
	
  ARTICLE THREE. Bonds of the 4.70% pollution
  control Series 2005-C Due 2028 and Issue Thereof.

  	
  18

  
	
   

  	
   

  	
   

  
	
  Sec. 1.

  	
  Series and Form of
  New Boone County Bonds

  	
  19

  
	
  Sec. 2.

  	
  Issue of New Boone
  County Bonds

  	
  19

  
	
  Sec. 3.

  	
  Dates, Interest, etc.,
  of New Boone County Bonds

  	
  19

  
	
  Sec. 4.

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

  	
  19

  
	
  Sec. 5.

  	
  Mandatory Redemption of
  New Boone County Bonds and Redemption Price

  	
  20

  
	
  Sec. 6.

  	
  Extraordinary Optional
  Redemption of New Boone County Bonds and Redemption Price

  	
  20

  
	
  Sec. 7.

  	
  Optional Redemption of
  New Boone County Bonds and Redemption Price

  	
  21

  
	
  Sec. 8.

  	
  Notice of Redemption of
  New Boone County Bonds

  	
  21

  
	
  Sec. 9.

  	
  New Boone County Bonds
  Deemed Paid in Certain Circumstances

  	
  21

  
	
  Sec. 10.

  	
  New Boone County Bonds
  Deemed Paid in Additional Circumstances

  	
  22

  
	
  Sec. 11.

  	
  Surrender of New Boone
  County Bonds in Certain Circumstances

  	
  22

  
	
  Sec. 12.

  	
  Application of Article Ten
  of First Mortgage as Amended

  	
  22

  
	
  Sec. 13.

  	
  Form of New Boone
  County Bonds

  	
  22

  
	
   

  	
   

  	
   

  
	
  ARTICLE FOUR. amendments to first mortgage as
  amended to become effective at a later date or dates.

  	
  22

  
	
   

  	
   

  	
   

  
	
  Sec. 1.

  	
  Amendments to First
  Mortgage

  	
  22

  
	
  Sec. 2.

  	
  Amendment to Section 3
  of Article One of First Mortgage

  	
  23

  
	
  Sec. 3.

  	
  Amendment to Section 3
  of Article One of First Mortgage

  	
  23

  
	
  Sec. 4.

  	
  Amendment to Section 7
  of Article One of First Mortgage

  	
  23

  
	
  Sec. 5.

  	
  Amendment to Section 5
  of Article Five of First Mortgage

  	
  26

  
	
  Sec. 6.

  	
  Amendment to Article Six
  of First Mortgage

  	
  26

  
	
  Sec. 7.

  	
  Amendment to Section 2
  of Article Eight of First Mortgage

  	
  26

  
	
  Sec. 8.

  	
  Amendment to Article Ten
  of First Mortgage

  	
  26

  
	
  Sec. 9.

  	
  Amendment to Section 3
  of Article Fifteen of First Mortgage

  	
  28

  
	
  Sec. 10.

  	
  Amendment to Section 2
  of Article Sixteen of First Mortgage

  	
  28

  
	
  Sec. 11.

  	
  Amendment to Section 3
  of Article Sixteen of First Mortgage

  	
  30

  
	
  Sec. 12.

  	
  Amendment to Section 4
  of Article Sixteen of First Mortgage

  	
  30

  
	
  Sec. 13.

  	
  Amendment to Section 2
  of Article Eighteen of First Mortgage

  	
  31

  
	
  Sec. 14.

  	
  Amendment to Section 3
  of Article Twenty-One of First Mortgage

  	
  31

  
	
  Sec. 15.

  	
  General Provisions
  Regarding Supplemental Indentures Effecting Amendments to First Mortgage

  	
  32

  
	
   

  	
   

  	
   

  
	
  ARTICLE FIVE. Covenants Of The Company.

  	
  32

  
	
   

  	
   

  	
   

  
	
  Sec. 1.

  	
  Confirmation of
  Covenants by Company in First Mortgage

  	
  32

  
	
  Sec. 2.

  	
  Covenant of the Company
  and Legal Opinion as to Recording

  	
  32

  

 

ii

 

	
  ARTICLE SIX. Miscellaneous.

  	
  32

  
	
   

  	
   

  	
   

  
	
  Sec. 1.

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

  	
  33

  
	
  Sec. 2.

  	
  Forty-Third
  Supplemental Indenture to Form Part of First Mortgage

  	
  33

  
	
  Sec. 3.

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

  	
  33

  
	
  Sec. 4.

  	
  Execution in
  Counterparts

  	
  33

  
	
   

  	
   

  	
   

  
	
  Testimonium

  	
  34

  
	
   

  	
   

  	
   

  
	
  Signatures

  	
  34

  
	
   

  	
   

  	
   

  
	
  Acknowledgments

  	
  35

  
	
   

  	
   

  	
   

  
	
  Exhibits

  	
   

  

 

iii

 

FORTY-THIRD SUPPLEMENTAL
INDENTURE, dated as of August 1, 2005, 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-two 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

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Eighth

  	
   

  	
  November 1,
  1957

  	
   

  	
  5% Series Due 1987

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Ninth

  	
   

  	
  March 1,
  1960

  	
   

  	
  51/8% Series Due 1990

  	
   

  	
  None

  	
   

  

 

1

 

	
  Supplemental

  Indenture

  	
   

  	
  Dated As Of

  	
   

  	
  Series

  Provided For

  	
   

  	
  Principal

  Amount

  Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  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

  	
   

  	
  $

  	
  9,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  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

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  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

  	
   

  
									

 

2

 

	
  Supplemental

  Indenture

  	
   

  	
  Dated As Of

  	
   

  	
  Series

  Provided For

  	
   

  	
  Principal

  Amount

  Outstanding

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  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

  	
   

  	
  $

  	
  32,300,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  6.40% Pollution Control Series 1992-B Due 2027

  	
   

  	
  $

  	
  27,800,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Seventh

  	
   

  	
  November 15,
  1992

  	
   

  	
  6.50% Pollution Control Series 1992-C Due 2022

  	
   

  	
  $

  	
  48,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Eighth

  	
   

  	
  November 15,
  1992

  	
   

  	
  8.40% Series Due 2022

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Thirty-Ninth

  	
   

  	
  January 15,
  1993

  	
   

  	
  8.15% Series Due 2026

  	
   

  	
  None

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  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

  	
   

  

 

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

 

3

 

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, 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 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, 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 have become effective; and

 

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

 

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-Third Supplemental Indenture to
create three new series of Bonds to be known as its (a) First Mortgage
Bonds, 4.80% Pollution Control Series 2005-A Due 2034 (hereinafter
sometimes called the New Water Bonds), which shall be limited to the aggregate
principal amount of $41,300,000; (b) First Mortgage Bonds, 4.80% Pollution
Control Series 2005-B Due 2034 (hereinafter sometimes called the New Air
Bonds), which shall be limited to the aggregate principal amount of
$137,800,000; and (c) First Mortgage Bonds, 4.70% Pollution Control Series 2005-C
Due 2028 (hereinafter sometimes called the New Boone County Bonds), which shall
be 

 

4

 

limited to the aggregate
principal amount of $35,275,000 ( such New Water Bonds, New Air Bonds and New
Boone County Bonds being hereinafter called collectively the New Bonds); and

 

WHEREAS,
the New Water Bonds are to be issued by the Company to the Ohio Water
Development Authority (hereinafter called the Water Authority) to evidence and
secure the obligations of the Company to repay the loan of the proceeds of the
sale of the Water Project Bonds (as hereinafter defined) made by the Water
Authority to the Company, pursuant to a certain Loan Agreement, dated as of August 1,
2005, between the Water Authority and the Company (hereinafter called the Water
Pollution Control Agreement), to assist in the refinancing of the Company’s
portion of the cost of acquisition, construction and installation of certain
waste water facilities and solid waste facilities (as such terms are defined
and used in Sections 6121.01 and 6123.01, respectively, of the Ohio Revised
Code) installed in connection with: Unit 2 of 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, the O. H. Hutchings Generating Station located in Montgomery County,
Ohio as to which the Company at the date hereof owns 100% of the station, and
the J. M. Stuart Generating Station located in Brown County, Ohio as to which
the Company at the date hereof owns an undivided 35% interest as a tenant in
common with two other public utility companies (such interests in said
facilities being hereinafter called the Water Project); and

 

WHEREAS,
the New Air Bonds are to be issued by the Company to the Ohio Air Quality
Development Authority (hereinafter called the Air Authority) to evidence and
secure the obligations of the Company to repay the loan of the proceeds of the
sale of the Air Project Bonds (as hereinafter defined) made by the Air
Authority to the Company, pursuant to a certain Loan Agreement, dated as of August 1,
2005, between the Air Authority and the Company (hereinafter called the Air
Pollution Control Agreement), to assist in the refinancing 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: Unit 2 of 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, the Walter C. Beckjord Generating Station Unit 6
located in Clermont County, Ohio as to which the Company at the date hereof
owns an undivided 50% interest as tenant in common with another public utility
company, and the William H. Zimmer Generating Station located in Clermont
County, Ohio as to which the Company at the date hereof owns an undivided 28.1%
interest as tenant in common with two other public utility companies (such
interests in said facilities being hereinafter called the Air Project); and

 

WHEREAS,
the New Boone County Bonds are to be issued by the Company to the Boone County
Board of Commissioners (hereinafter called Boone County) to evidence and secure
the obligations of the Company to repay the loan of the proceeds of the sale of
the Boone County Project Bonds (as hereinafter defined) made by Boone County to
the Company, pursuant to a certain Loan Agreement, dated as of August 1,
2005, between Boone County and the Company (hereinafter called the Boone County
Pollution Control Agreement), to assist in the refinancing of the Company’s
portion of the cost of acquisition, construction and installation of certain
solid waste facilities installed in connection with Unit 2 of the East Bend
Generating Station located in Boone County, Kentucky as to which the Company at
the date hereof owns an undivided 31% interest as tenant in common with another
public utility company (such interests in said facilities being hereinafter
called the Boone County Project); and

 

WHEREAS,
the loan by the Water Authority in respect of the Water Project is to be funded
by the proceeds derived from the sale by the Water Authority of State of Ohio
Collateralized Pollution Control Revenue Refunding Bonds, 2005 Series A
(The Dayton Power and Light Company Project), in the aggregate principal amount
of $41,300,000 (hereinafter called the Water Project Bonds); and

 

WHEREAS,
the loan by the Air Authority in respect of the Air Project is to be funded by
the proceeds derived from the sale by the Air Authority of State of Ohio
Collateralized Pollution Control Revenue Refunding Bonds, 2005 Series B
(The Dayton Power and Light Company Project), in the aggregate principal amount
of $137,800,000 (hereinafter called the Air Project Bonds); and

 

WHEREAS,
the loan by Boone County in respect of the Boone County Project is to be funded
by the proceeds derived from the sale by Boone County of County of Boone,
Kentucky Collateralized Pollution Control Revenue Refunding Bonds, 2005 Series A
(The Dayton Power and Light Company Project), in the aggregate principal amount
of $35,275,000 (hereinafter called the Boone County Project Bonds); and

 

5

 

WHEREAS,
the Water Project Bonds are to be issued under a certain Trust Indenture, dated
as of August 1, 2005 (hereinafter called the Water Pollution Control
Indenture), between the Water Authority and The Bank of New York, as Trustee
(hereinafter in such capacity called the Water Project Bond Trustee), and the
New Water Bonds are to be assigned by the Water Authority to the Water Project
Bond Trustee as security for the payment of the principal of and interest on
the Water Project Bonds and are to be delivered by the Company on behalf of the
Water Authority directly to the Water Project Bond Trustee; and

 

WHEREAS, the Air Project Bonds are to be issued under
a certain Trust Indenture, dated as of August 1, 2005 (hereinafter called
the Air Pollution Control Indenture), between the Air Authority and The Bank of
New York, as Trustee (hereinafter in such capacity called the Air Project Bond
Trustee), and the New Air Bonds are to be assigned by the Air Authority to the
Air Project Bond Trustee as security for the payment of the principal of and
interest on the Air Project Bonds and are to be delivered by the Company on
behalf of the Air Authority directly to the Air Project Bond Trustee; and

 

WHEREAS, the Boone County Project Bonds are to be
issued under a certain Trust Indenture, dated as of August 1, 2005
(hereinafter called the Boone County Pollution Control Indenture), between
Boone County and The Bank of New York, as Trustee (hereinafter in such capacity
called the Boone County Project Bond Trustee), and the New Boone County Bonds
are to be assigned by Boone County to the Boone County Project Bond Trustee as
security for the payment of the principal of and interest on the Boone County
Project Bonds and are to be delivered by the Company on behalf of Boone County
directly to the Boone County 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 forms of Exhibits A, B and C hereto, as applicable;
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-Third
Supplemental Indenture (including the forms of the New Bonds), and the
execution by the Company of a supplemental indenture in such form and having
substantially the same form, terms and the provisions as said Thirty-Six
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-Third 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-Third
Supplemental Indenture, the receipt whereof is hereby acknowledged, the Company
has executed and delivered this Forty-Third Supplemental Indenture, and has
granted, bargained, sold, released, conveyed, assigned, transferred, pledged,
set over and 

 

6

 

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: 

 

FIRST

REAL PROPERTY AND INTERESTS IN REAL PROPERTY.

 

All and singular, all real property and interests in
real property acquired by the Company between September 1, 2003, the date
of the Forty-Second Supplemental Indenture, and the date of this Forty-Third
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 September 1, 2003, the date of the
Forty-Second Supplemental Indenture, and the date of this Forty-Third
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 September 1, 2003, the date of
the Forty-Second Supplemental Indenture, and the date of this Forty-Third
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 September 1, 2003, the date of the Forty-Second
Supplemental Indenture, and the date of this Forty-Third 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 

 

7

 

appertaining thereto, or
used, occupied or enjoyed in connection with any of such substations and
switching stations.

 

FIFTH

ELECTRIC DISTRIBUTION SYSTEMS.

 

All electric distribution systems of the Company
acquired by it between September 1, 2003, the date of the Forty-Second
Supplemental Indenture, and the date of this Forty-Third 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 September 1,
2003, the date of the Forty-Second Supplemental Indenture, and the date of this
Forty-Third 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 September 1, 2003, the date of the
Forty-Second Supplemental Indenture, and the date of this Forty-Third
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.

 

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 September 1, 2003, the date of the Forty-Second Supplemental
Indenture, and the date of this Forty-Third 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.

 

8

 

NINTH

TELEPHONE LINES.

 

All telephone lines of the Company acquired by it
between September 1, 2003, the date of the Forty-Second Supplemental
Indenture, and the date of this Forty-Third 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 September 1,
2003, the date of the Forty-Second Supplemental Indenture, and the date of this
Forty-Third 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-Third 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-Third
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, 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.

 

9

 

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 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.

 

10

 

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 2004 and 2005
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.

 

ARTICLE ONE 

 

BONDS OF THE 4.80% POLLUTION CONTROL SERIES 2005-A
DUE 2034 AND ISSUE THEREOF.

 

SECTION 1                                                                                         There shall be a series of Bonds
designated “4.80% Pollution Control Series 2005-A Due 2034”, each of which
shall bear the descriptive title First Mortgage Bond.  The aggregate principal amount of the New
Water Bonds which may be outstanding under the First Mortgage as amended and
this Forty-Third Supplemental Indenture shall be limited to $41,300,000, 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-Third Supplemental Indenture and upon delivery of
$41,300,000 aggregate principal amount of the New Water 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-Third Supplemental Indenture,
authenticate the New Water Bonds and deliver the New Water Bonds as provided in
said Article Five, Article Six or Article Seven.

 

SECTION 3                              The New Water
Bonds shall be dated as provided in Section 3 of Article Two of the
First Mortgage as amended; shall mature on January 1, 2034; and shall bear
interest from August 17, 2005 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 January 1, 2006 and
thereafter semi-annually on each January 1 and July 1, and on the
maturity date, to the Bondholders in whose names such New Water Bonds are
registered at the close of business on the Business Day immediately preceding
such January 1 or July 1, except that if the Company shall default in
the payment of any installment of interest on any New Water Bonds, such interest
in default shall be paid to the Bondholders in whose names the New Water 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 Water 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 

 

11

 

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 Water 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.

 

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

 

Whenever any New Water Bond or New Water Bonds shall be surrendered at
the office or agency of the Company in said Borough of Manhattan for exchange
for a New Water Bond or New Water Bonds of other authorized denomination or
denominations, the Company shall execute, and the Trustee shall authenticate
and deliver, upon cancellation of the New Water Bond or New Water Bonds so
surrendered, a New Water Bond or New Water 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
Water 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 Water Bond or New Water Bonds in
principal amount equal to the unredeemed portion of the New Water Bond so
presented.

 

The Company shall not be required to (a) register a transfer of,
or exchange, any New Water Bond during a period of fifteen (15) days next
preceding any selection of New Water Bonds to be redeemed or (b) register
a transfer of, or exchange, any New Water 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 Water 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 Water 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 Water Bonds but
subject to the same provisions, limitations and conditions except as to the
denominations thereof, temporary printed or lithographed New Water Bonds as
provided in Section 8 of Article Two of the First Mortgage as
amended.  Such temporary New Water Bonds
shall be exchangeable for definitive New Water 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-Third Supplemental Indenture, and the terms and
provisions and lien of the First Mortgage as amended as therein provided.

 

SECTION 5                                                                                         The New Water 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 interest to the redemption date, upon receipt by the Trustee of
notice from the Water Project Bond Trustee to the effect that (a) the
Company is required to deliver moneys to the Water Project Bond Trustee for the
redemption of the Water 

 

12

 

Project Bonds in whole or in part, as the case may be, as provided in Section 6.3
of the Water Pollution Control Agreement and (b) an equivalent principal
amount of the Water Project Bonds are being concurrently called for
redemption.  Said notice shall specify
the redemption date of such New Water Bonds (which redemption date shall be the
same date as the redemption date specified in said notice for the Water 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.

 

SECTION 6                                                                                           The New Water 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 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 Water Project Bond Trustee that the Company is exercising
its option to direct the redemption of Water Project Bonds in whole or in part,
as provided in Section 6.2 of the Water Pollution Control Agreement and (b) an
equivalent principal amount of New Water Project Bonds are being concurrently
called for redemption.  Such officers’
certificate shall have attached to it a copy of said notice to the Water
Project Bond Trustee and shall specify the redemption date of such New Water
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 Water 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 Water 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 July 1, 2015, at a
redemption price equal to 100% of the principal amount thereof, plus accrued
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 Water Project Bond Trustee that the Company is exercising
its option to deliver moneys to the Water Project Bond Trustee for the
redemption of Water Project Bonds in whole or in part, as the case may be, as
provided in Section 6.1 of the Water Pollution Control Agreement and (b) an
equivalent principal amount of Water Project Bonds are being concurrently
called for redemption.  Such officers’
certificate shall specify the principal amount of New Water Bonds to be
redeemed, shall have attached to it a copy of said notice to the Water Project
Bond Trustee and shall specify the redemption date of such New Water Bonds
(which redemption date shall be not less than 45 days (unless a shorter time
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 Water 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 Water 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 Water 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 Water 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 

 

13

 

date; provided, however, that the registered owner or owners of all New
Water Bonds may consent in writing to a shorter notice period, and 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 Water 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 Water Project Bonds being concurrently redeemed.

 

SECTION 9                                                                                             In the event any Water Project Bonds
shall be purchased by the Company and surrendered by the Company to the Water
Project Bond Trustee for cancellation or shall be otherwise surrendered to the
Water Project Bond Trustee for cancellation pursuant to the Water Pollution
Control Indenture (except upon exchange for other Water Project Bonds), New
Water Bonds equivalent in principal amount to the Water 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 Water Bonds
shall be noted by an agency of the Company on the schedule of payments on
such New Water 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 Water 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 Water Project Bonds shall be
paid out of funds held by the Water 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 Water Bonds equal to an aggregate principal amount of such Water
Project Bonds shall be deemed to have been paid, but, in the case of such
payment of principal of such New Water 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 Water 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 Water 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 Water 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 Water 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 Water 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 Water Bond to the Trustee for cancellation, in which event the Trustee
shall cancel such New Water Bond and the Company shall execute and the Trustee
shall authenticate and deliver, without charge to the registered owner, New
Water 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 Water Bond.

 

SECTION 12                                Except as in this
Forty-Third Supplemental Indenture otherwise provided with respect to any
matter or question, the provisions of Article Ten of the First Mortgage as
amended shall be applicable in the case of the redemption of all or any part of
the New Water 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 

 

14

 

President, the Treasurer, Assistant Treasurer, the Secretary or
Assistant Secretary or any other officer of the Company.

 

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

 

ARTICLE TWO

 

BONDS OF THE 4.80% POLLUTION CONTROL SERIES 2005-B
DUE 2034 AND ISSUE THEREOF.

 

SECTION 1                                                                                         There shall be a series of Bonds
designated “4.80% Pollution Control Series 2005-B Due 2034”, each of which
shall bear the descriptive title First Mortgage Bond.  The aggregate principal amount of New Air
Bonds which may be outstanding under the First Mortgage as amended and this
Forty-Third Supplemental Indenture shall be limited to $137,800,000, 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-Third Supplemental Indenture and upon delivery of $137,800,000 aggregate
principal amount of the New Air 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-Third Supplemental Indenture, authenticate the New
Air Bonds and deliver the New Air Bonds as provided in said Article Five, Article Six
or Article Seven.

 

SECTION 3                                                                                         The New Air Bonds shall be dated as
provided in Section 3 of Article Two of the First Mortgage as
amended; shall mature on January 1, 2034,; and shall bear interest from August 17,
2005 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 January 1, 2006 and thereafter
semi-annually on each January 1 and July 1, and on the maturity date,
to the Bondholders in whose names such New Air Bonds are registered at the
close of business on the Business Day immediately preceding such January 1
or July 1, except that if the Company shall default in the payment of any
installment of interest on any New Air Bonds, such interest in default shall be
paid to the Bondholders in whose names the New Air 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 Air 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 Air 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 

 

15

 

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.

 

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

 

Whenever any New Air Bond or New Air Bonds shall be surrendered at the
office or agency of the Company in said Borough of Manhattan for exchange for a
New Air Bond or New Air Bonds of other authorized denomination or
denominations, the Company shall execute, and the Trustee shall authenticate
and deliver, upon cancellation of the New Air Bond or New Air Bonds so
surrendered, a New Air Bond or New Air 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 Air
Bond which is to be redeemed pursuant to the provisions of Section 5 of
this Article Two in part only, the Company shall execute, and the Trustee
shall authenticate and deliver, a New Air Bond or New Air Bonds in principal
amount equal to the unredeemed portion of the New Air Bond so presented.

 

The Company shall not be required to (a) register a transfer of,
or exchange, any New Air Bond during a period of fifteen (15) days next preceding
any selection of New Air Bonds to be redeemed or (b) register a transfer
of, or exchange, any New Air 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 Air 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 Air 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 Air Bonds but subject to the same
provisions, limitations and conditions except as to the denominations thereof,
temporary printed or lithographed New Air Bonds as provided in Section 8
of Article Two of the First Mortgage as amended.  Such temporary New Air Bonds shall be
exchangeable for definitive New Air 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-Third Supplemental Indenture, and the terms and
provisions and lien of the First Mortgage as amended as therein provided.

 

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

 

16

 

SECTION 6                                                                                           The New Air 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 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 Air Project Trustee that the Company is exercising its option to direct
the redemption of Air Project Bonds in whole or in part, as provided in Section 6.2
of the Air Pollution Control Agreement and (b) an equivalent principal
amount of New Air Project Bonds are being concurrently called for
redemption.  Such officers’ certificate
shall have attached to it a copy of said notice to the Air Project Bond Trustee
and shall specify the redemption date of such New Air 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 Air 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 Two,
and in the manner provided in this Article Two, subject to the provisions
of the First Mortgage as amended.

 

SECTION 7                                                                                        The New Air 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 July 1, 2015, at a redemption price equal to
100% of the principal amount thereof, plus accrued 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 Trustee that the Company is exercising its option to
deliver moneys to the Air Project Bond Trustee for the redemption of Air
Project Bonds in whole or in part, as the case may be, as provided in Section 6.1
of the Air Pollution Control Agreement and (b) an equivalent principal
amount of Air Project Bonds are being concurrently called for redemption.  Such officers’ certificate shall specify the
principal amount of the New Air Bonds to be redeemed, shall have attached to it
a copy of said notice to the Air Project Bond Trustee and shall specify the
redemption date of such New Air 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 Air 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 Two, and in the manner provided in this Article Two,
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 Air Bonds pursuant
to any of Sections 5, 6 or 7 of this Article Two shall be given by the
Trustee by mailing, first class postage prepaid, or delivering by hand to the
registered owner of such New Air 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 Air 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 Air Bonds may consent in writing to a
shorter notice period, and 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 Air 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 Air Project Bonds being concurrently
redeemed.

 

17

 

SECTION 9                                                                                            In the event any Air Project Bonds shall
be purchased by the Company and surrendered by the Company to the Air Project
Bond Trustee for cancellation or shall be otherwise surrendered to the Air
Project Bond Trustee for cancellation pursuant to the Air Pollution Control
Indenture (except upon exchange for other Air Project Bonds), New Air Bonds
equivalent in principal amount to the Air 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 Air Bonds shall be noted by an
agency of the Company on the schedule of payments on such New Air 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 Air Bonds
shall have been surrendered to and cancelled by the Trustee as provided in Section 11
of this Article Two.

 

SECTION 10                                                                                            In the event and to the extent the
principal of or interest on any Air Project Bonds shall be paid out of funds
held by the Air 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
Air Bonds equal to an aggregate principal amount of such Air Project Bonds
shall be deemed to have been paid, but, in the case of such payment of
principal of such New Air 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 Air 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 Air Bonds shall have
been surrendered to and cancelled by the Trustee as provided in Section 11
of this Article Two.

 

SECTION 11                                                                                         When payment of any principal amount of a
New Air Bond is made as provided in Section 9 or 10 of this Article Two,
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 Air Bonds deemed
to have been paid in full as provided in Section 9 or 10 of this Article Two
shall be surrendered to the Trustee for cancellation and the Trustee shall
forthwith cancel the same.  In the event
that part of a New Air 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 Air Bond to the Trustee for cancellation, in which event the Trustee
shall cancel such New Air Bond and the Company shall execute and the Trustee
shall authenticate and deliver, without charge to the registered owner, New Air
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 Air
Bond.

 

SECTION 12                                                                                            Except as in this Forty-Third
Supplemental Indenture otherwise provided with respect to any matter or
question, the provisions of Article Ten of the First Mortgage as amended
shall be applicable in the case of the redemption of all or any part of the New
Air Bonds at any time outstanding.  The
term “officers’ certificate as used in this Article Two 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 Air Bonds shall be in fully
registered form only.  The form of the
New Air Bonds, and of the Trustee’s certificate of authentication thereon, shall
be substantially as set forth in Exhibit B.

 

ARTICLE THREE

 

BONDS OF THE 4.70% POLLUTION CONTROL SERIES 2005-C
DUE 2028 AND ISSUE THEREOF.

 

18

 

SECTION 1                                                                                         There shall be a series of Bonds
designated “4.70% Pollution Control Series 2005-C Due 2028”, each of which
shall bear the descriptive title First Mortgage Bond.  The aggregate principal amount of the New
Boone County Bonds which may outstanding under the First Mortgage as amended
and this Forty-Third Supplemental Indenture shall be limited to $35,275,000,
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-Third Supplemental Indenture and upon delivery of $35,275,000 aggregate
principal amount of the New Boone County 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-Third Supplemental Indenture, authenticate the New
Boone County Bonds and deliver the New Boone County Bonds as provided in said Article Five,
Article Six or Article Seven.

 

SECTION 3                                                                                         The New Boone County Bonds shall be dated
as provided in Section 3 of Article Two of the First Mortgage as
amended; shall mature on January 1, 2028; and shall bear interest from August 17,
2005 as provided in said Section 3 of Article Two at the rate of four
and seventy hundredths per centum (4.70%) per annum until paid or redeemed as
hereinafter provided, payable on January 1, 2006 and thereafter
semi-annually on each January 1 and July 1, and on the maturity date,
to the Bondholders in whose names such New Boone County Bonds are registered at
the close of business on the Business Day immediately preceding such January 1
or July 1, except that if the Company shall default in the payment of any
installment of interest on any New Boone County Bonds, such interest in default
shall be paid to the Bondholders in whose names the New Boone County 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 Boone County 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
Boone County 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.

 

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

 

Whenever any New Boone County Bond or New Boone County Bonds shall be
surrendered at the office or agency of the Company in said Borough of Manhattan
for exchange for a New Boone County Bond or New Boone County Bonds of other
authorized denomination or denominations, the Company shall execute, and the
Trustee shall authenticate and deliver, upon cancellation of the New Boone
County Bond or New Boone County Bonds so surrendered, a New Boone County Bond
or New Boone County Bonds of such other authorized denomination or 

 

19

 

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
Boone County Bond which is to be redeemed pursuant to the provisions of Section 5
of this Article Three in part only, the Company shall execute, and the
Trustee shall authenticate and deliver, a New Boone County Bond or New Boone
County Bonds in principal amount equal to the unredeemed portion of the New
Boone County Bond so presented.

 

The Company shall not be required to (a) register a transfer of,
or exchange, any New Boone County Bond during a period of fifteen (15) days
next preceding any selection of New Boone County Bonds to be redeemed or (b) register
a transfer of, or exchange, any New Boone County 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 Boone County 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 Boone County 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 Boone County Bonds but
subject to the same provisions, limitations and conditions except as to the
denominations thereof, temporary printed or lithographed New Boone County Bonds
as provided in Section 8 of Article Two of the First Mortgage as
amended.  Such temporary New Boone County
Bonds shall be exchangeable for definitive New Boone County 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-Third Supplemental Indenture, and
the terms and provisions and lien of the First Mortgage as amended as therein
provided.

 

SECTION 5                                                                                         The New Boone County 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 interest to the redemption date, upon receipt by the
Trustee of notice from the Boone County Project Bond Trustee to the effect that
(a) the Company is required to deliver moneys to the Boone County Project
Bond Trustee for the redemption of the Boone County Project Bonds in whole or
in part, as the case may be, as provided in Section 6.3 of the Boone
County Pollution Control Agreement and (b) an equivalent principal amount
of Boone County Project Bonds are being concurrently called for
redemption.  Said notice shall specify
the redemption date of such New Boone County Bonds (which redemption date shall
be the same date as the redemption date specified in said notice for the Boone
County Project Bonds being currently redeemed). 
Any such redemption shall be made upon the notice and in the manner
provided in this Article Three, subject to the provisions of the First
Mortgage as amended.

 

SECTION 6                                                                                           The New Boone County 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 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 Boone County Project Bond Trustee that the
Company is exercising its option to direct the redemption of Boone County
Project Bonds in whole or in part, as provided in Section 6.2 of the Boone
County Pollution Control Agreement and (b) an equivalent principal amount
of New Boone County Project Bonds are being concurrently called for
redemption.  Such officers’ certificate
shall have attached to it a copy of said notice to the Boone County Project
Bond Trustee and shall specify the redemption date of such applicable New Boone
County Bonds

 

20

 

(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 Boone County 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 Three, and in the manner provided in this Article Three,
subject to the provisions of the First Mortgage as amended.

 

SECTION 7                                                                                        The New Boone County 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 July 1, 2015, at a redemption price
equal to 100% of the principal amount thereof, plus accrued 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 Boone County Bond Trustee that the Company is exercising
its option to deliver moneys to the Boone County Bond Trustee for the
redemption of Boone County Project Bonds in whole or in part, as the case may
be, as provided in Section 6.1 of the Boone County Pollution Control
Agreement and (b) an equivalent principal amount of Boone County Project
Bonds are being concurrently called for redemption.  Such officers’ certificate shall specify the
principal amount of the New Boone County Bonds to be redeemed, shall have
attached to it a copy of said notice to the applicable Boone County Project
Bond Trustee and shall specify the redemption date of such New Boone County
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 Boone County 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 Three, and in the manner provided in this Article Three,
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 Boone County Bonds
pursuant to any of Sections 5, 6 or 7 of this Article Three shall be given
by the Trustee by mailing, first class postage prepaid, or delivering by hand
to the registered owner of such New Boone County 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 Boone County 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 Boone County Bonds may consent in
writing to a shorter notice period, and 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 Boone County 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 Boone County
Project Bonds being concurrently redeemed.

 

SECTION 9                                                                                            In the event any Boone County Project
Bonds shall be purchased by the Company and surrendered by the Company to the
Boone County Project Bond Trustee for cancellation or shall be otherwise
surrendered to the Boone County Project Bond Trustee for cancellation pursuant
to the Boone County Pollution Control Indenture (except upon exchange for other
Boone County Project Bonds), New Boone County Bonds equivalent in principal
amount to the Boone County 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 Boone County Bonds shall be noted by an agency of the
Company on the schedule of payments on such New Boone County 

 

21

 

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 Boone County Bonds shall have been surrendered to and cancelled by the
Trustee as provided in Section 11 of this Article Three.

 

SECTION 10                                                                                            In the event and to the extent the
principal of or interest on any Boone County Project Bonds shall be paid out of
funds held by the Boone County 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 Boone County Bonds equal to an aggregate principal amount of such
Boone County Project Bonds shall be deemed to have been paid, but, in the case
of such payment of principal of such New Boone County 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
Boone County 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 Boone County Bonds shall have been surrendered to and cancelled by the
Trustee as provided in Section 11 of this Article Three.

 

SECTION 11                                                                                         When payment of any principal amount of a
New Boone County Bond is made as provided in Section 9 or 10 of this Article Three,
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 Boone County Bonds
deemed to have been paid in full as provided in Section 9 or 10 of this Article Three
shall be surrendered to the Trustee for cancellation and the Trustee shall
forthwith cancel the same.  In the event
that part of a New Boone County 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 Boone County Bond to the Trustee for cancellation, in which
event the Trustee shall cancel such New Boone County Bond and the Company shall
execute and the Trustee shall authenticate and deliver, without charge to the
registered owner, New Boone County 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 the such surrendered New Boone County Bond.

 

SECTION 12                                                                                            Except as in this Forty-Third
Supplemental Indenture otherwise provided with respect to any matter or
question, the provisions of Article Ten of the First Mortgage as amended
shall be applicable in the case of the redemption of all or any part of the New
Boone County Bonds at any time outstanding. 
The term officers’ certificate as used in this Article Three 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 Boone County Bonds shall be in
fully registered form only.  The form of
the New Boone County Bonds, and of the Trustee’s certificate of authentication
thereon, shall be substantially as set forth in Exhibit C.

 

ARTICLE FOUR

 

AMENDMENTS TO FIRST MORTGAGE AS AMENDED TO BECOME EFFECTIVE AT A LATER DATE OR DATES.

 

SECTION 1                                                                                         The Company, and the holders of any New
Bonds by their acceptance and holding thereof, hereby consent and agree that
each of the amendments provided for by the following Sections 2, 3, 4, 5, 6, 7,
8, 9, 10, 11, 12, 13 and 14 of this Article Four shall become effective on
the earliest date on which either (a) there shall not be any Bonds
outstanding of 

 

22

 

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 and 5.125% Series Due 2013 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), all
in conformity with the provisions of Article Eighteen of the First
Mortgage as amended.

 

SECTION 2                                                                                        Effective on a date fixed as provided in Section 1
of this Article Four, the following definition shall be added to Section 3
of Article One of the First Mortgage as amended after the definition of
the term “resolution” reading as follows:

 

“The term “Board of Directors” shall mean the board of directors of the
Company or any committee thereof duly authorized by resolution duly adopted by
said board of directors to act in respect of matters relating to this
Indenture.”

 

SECTION 3                                                                                         Effective on a date fixed as provided in Section 1
of this Article Four, the phrase “Board of Directors or the Executive
Committee” shall be replaced by the phrase “Board of Directors” in each and
every place where such phrase appears in the First Mortgage as amended.

 

SECTION 4                                                                                        Effective on a date fixed as provided in Section 1
of this Article Four, Section 7 of Article One of the First
Mortgage as amended shall be restated in its entirety to read as follows:

 

“The
term “net earnings certificate”, shall mean a certificate signed by the
Chairman of the Board or Chief Executive Officer or President or a Vice
President of the Company and an accountant, who unless, required to be
independent, may be an officer or employee of the Company, stating:

 

(A)                              the adjusted
net earnings of the Company for a period of twelve (12) consecutive calendar
months within the eighteen (18) calendar months immediately preceding the first
day of the month in which the application for the authentication and delivery
under this Indenture of Bonds then applied for is made, being and specifying:

 

(1)                                  its operating
revenues, which may include revenues collected by the Company subject to
possible refund at a future date, with the principal divisions thereof;

 

(2)                                  its operating
expenses, with the principal divisions thereof, including, without limitation,
all expenses and accruals for repairs and maintenance and all appropriations
out of income for property retirement in respect of all property owned by the
Company;

 

(3)                                  the amount
remaining after deducting the amount required to be stated in such certificate
by clause (2) of this Section from the amount required to be stated
therein by clause (1) of this Section;

 

(4)                                  its rental
revenues (net) not otherwise included in such certificate;

 

23

 

(5)                                  the sum of the
amounts required to be stated in such certificate by clauses (3) and (4) of
this Section;

 

(6)                                  its other
income or loss (net);

 

(7)                                  the amount, if
any, by which the amount of other income or loss (net) required to be stated in
such certificate by clause (6) of this Section exceeds, without
regard to whether such net amount constitutes income or loss, ten per centum
(10%) of the amount required to be stated in such certificate by clause (5) of
this Section;

 

(8)                                  the amount
remaining after reducing the amount required to be stated in such certificate
by clause (6) of this Section by the amount required to be stated
therein by clause (7) of this Section; and

 

(9)                                  the adjusted
net earnings of the Company for such period of twelve (12) consecutive calendar
months (being the sum of the amounts required to be stated in such certificate
by clauses (5) and (8) of this Section);

 

(B)                                the annual
interest requirements, being the interest requirements, if any, for twelve (12)
months upon:

 

(1)                                  all Bonds outstanding
hereunder at the date of such certificate, except any for the payment of which
the Bonds applied for are to be issued; provided that, if any such series of
outstanding Bonds bears interest at a variable rate, then the interest on such
series of Bonds shall be computed at the average annual rate in effect for such
series during the period of twelve (12) consecutive calendar months (or any
portion thereof in which Bonds of such series are outstanding) being used for
the calculation of adjusted net earnings; and if such outstanding Bonds have
been issued after the end of such twelve (12) consecutive calendar months, then
computed at the initial rate upon issuance;

 

(2)                                  all Bonds then
applied for in pending applications, including the application in connection
with which such certificate is made, computed at the initial rate upon
issuance;

 

(3)                                  the principal
amount of all other indebtedness (except indebtedness for the payment of which
the Bonds applied for are to be issued and indebtedness for the purchase,
payment or redemption of which moneys in the necessary amount shall have been
deposited with or be held by the Trustee or the trustee or other holder of a
lien prior to the lien of this Indenture upon property subject to the lien of
this Indenture with irrevocable direction so to apply the same; provided that,
in the case of redemption, the notice required therefor shall have been given
or have been provided for to the satisfaction of the Trustee), outstanding in
the hands of the public on the date of such certificate and secured by a lien
prior to the lien of this Indenture upon property subject to the lien of this
Indenture, if said indebtedness has been assumed by the Company or if the
Company customarily pays the interest upon the principal thereof.

 

24

 

In calculating such adjusted net earnings, all the Company’s expenses
for taxes (other than income, profits and other taxes measured by, or dependent
on, net income), assessments, rentals and insurance shall be included in its
operating expenses, or otherwise deducted from its revenues and income;
provided, however, that no expenses or provisions for interest on any of its
indebtedness or for the amortization of debt discount, premium and expense, or
loss on reacquired debt, amortization of property (other than depreciation or
other similar provisions for property retirement), or for other amortization,
or for any other extraordinary charge to income of whatever kind or nature, or
for refunds of revenues previously collected by the Company subject to possible
refund, or for any improvement or sinking fund or other device for the
retirement of any indebtedness, shall be required to be included in operating
expenses to be deducted from, or shall be otherwise required to be deducted
from, its revenues or its other income and no extraordinary items of any kind
or nature shall be included in calculating such adjusted net earnings.

 

If any of the property of the Company owned by it at the time of the
making of any net earnings certificate shall have been acquired during or after
any period for which adjusted net earnings of the Company are to be computed,
the adjusted net earnings of such property (computed in the manner in this Section provided
for the computation of the adjusted net earnings of the Company) during such
period or such part of such period as shall have preceded the acquisition
thereof, to the extent that the same have not otherwise been included and
unless such property shall have been acquired in exchange or substitution for
property the earnings of which have been included, may, at the option of the
Company, be included in the adjusted net earnings of the Company for all
purposes of this Indenture, and shall be included if such property has been
operated as a separate unit or if the earnings therefrom are readily
ascertainable.

 

In any case where a net earnings certificate is required as a condition
precedent to the authentication and delivery of Bonds, such certificate shall
also be made and signed by an independent public accountant, if the aggregate
principal amount of Bonds then applied for plus the aggregate principal amount
of Bonds authenticated and delivered hereunder since the commencement of the
then current calendar year (other than those with respect to which a net
earnings certificate is not required, or with respect to which a net earnings
certificate made and signed by an independent public accountant has previously
been furnished to the Trustee) is ten per centum (10%) or more of the aggregate
principal amount of the Bonds at the time outstanding hereunder; but no net
earnings certificate need be made and signed by any person other than the
Chairman of the Board or Chief Executive Officer or President or a Vice
President and an accountant, as to dates or periods not covered by annual
reports required to be filed by the Company, in the case of conditions
precedent which depend upon a state of facts as of a date or dates or for a
period or periods different from that required to be covered by such annual
reports.

 

Each such certificate shall include the statements required by Section 1
of Article Twenty hereof.

 

The phrase “appropriations out of income for property retirement”, and
other phrases, of similar import shall be deemed to include not only charges
made upon a retirement accounting theory but also charges made on any
depreciation or other accounting theory intended to provide for retirement of
property.

 

Unless otherwise specifically provided with respect to a series of
Bonds, if interest on any Bonds outstanding hereunder is payable solely in the
coin or currency of a foreign nation, then the annual interest requirements for
such Bonds shall be based upon the estimated value (on a date within 10 days
prior to the date of the application for the authentication and 

 

25

 

delivery under this Indenture of Bonds in connection
with which such net earnings certificate is delivered) of such foreign coin or
currency in The City of New York, New York, in the written opinion of an
independent appraiser or other expert delivered to the Trustee.”

 

SECTION 5                                                                                         Effective on a date fixed as provided in Section 1
of this Article Four, Section 5 of Article Five of the First
Mortgage as amended shall be restated in its entirety to read as follows:

 

“No Bonds shall be authenticated and delivered upon
the basis of property additions unless, as shown by a net earnings certificate,
the adjusted net earnings of the Company for the twelve consecutive calendar
months’ period therein referred to shall have been in the aggregate at least
equivalent to twice the annual interest requirements as shall be specified,
pursuant to the provisions of subdivision (B) of Section 7 of Article One
hereof, in such net earnings certificate.”

 

SECTION 6                                                                                           Effective on a date fixed as provided in Section 1
of this Article Four, Article Six of the First Mortgage as amended
shall be amended by deleting a parenthetical appearing after the phrase “sinking
fund provisions of any indenture supplemental hereto” and before the phrase “,
the Trustee shall authenticate and deliver additional Bonds.”

 

SECTION 7                                                                                        Effective on a date fixed as provided in Section 1
of this Article Four, Section 2 of Article Eight of the First
Mortgage as amended shall be amended to delete the second paragraph of such Section 2.

 

SECTION 8                                                                                        Effective on a date fixed as provided in Section 1
of this Article Four, Article Ten of the First Mortgage as amended
shall be amended as follows:

 

(a)  Section 2
of Article Ten shall be amended by deleting the second, third and fourth
sentences thereof and inserting in lieu thereof the following:

 

“Notice of redemption shall be mailed to each holder
of the Bonds to be redeemed, at the address of such holder as it appears in the
registry books, not less than 30 nor more than 60 days prior to the date of
redemption.  Failure duly to mail such
notice to the owner or holder of any Bond designated for redemption in whole or
in part shall not affect the validity of the proceedings for the redemption of
any other Bond.

 

With respect to any notice of redemption of the Bonds
at the election of the Company such notice may state that such redemption shall
be conditional upon the receipt by the paying agent or agents for such Bonds,
on or prior to the date fixed for such redemption, of money sufficient to pay
the principal of and premium, if any, and interest, if any, on such Bonds and
that if such money shall not have been so received such notice shall be of no
force or effect and the Company shall not be required to redeem such
Bonds.  In the event that such notice of
redemption contains such a condition and such money is not so received, the
redemption shall not be made and within a reasonable time thereafter notice
shall be given, in the manner in which the notice of redemption was given, that
such money was not so received and such redemption was not required to be made,
and the paying agent or agents for the Bonds otherwise to have been redeemed
shall promptly return to the holders thereof any of such Bonds which had been
surrendered for payment upon such redemption.

 

26

 

Notice of redemption of the Bonds to be redeemed at
the election of the Company, and any notice of non-satisfaction of a condition
for redemption as aforesaid, shall be given by the Company or, at the Company’s
request, by the Trustee in the name and at the expense of the Company.  Notice of any mandatory redemption of the
Bonds shall be given by the Trustee in the name and at the expense of the
Company.”

 

(b)  The first
paragraph of Section 3 of Article Ten shall be restated in its
entirety to read as follows:

 

“Notice of redemption having been given as aforesaid,
and the conditions, if any, set forth in such notice having been satisfied, the
Bonds or portions thereof so to be redeemed shall, on the date of redemption,
become due and payable at the redemption price therein specified, and from and
after such date (unless, in the case of an unconditional notice of redemption,
the Company shall default in the payment of the redemption price and accrued
interest, if any) such Bonds or portions thereof, if interest-bearing, shall
cease to bear interest.  Upon surrender
of any such Bond for redemption in accordance with such notice, such Bond or
portion thereof shall be paid by the Company at the redemption price, together
with accrued interest, if any, to the date of redemption; provided, however,
that no such surrender shall be a condition to such payment if so specified
with respect to such Bond in a supplemental indenture establishing the terms of
such Bond.”

 

(c)  Clause (b) of
the second paragraph of Section 3 of Article Ten shall be restated in
its entirety to read as follows:

 

“(b) furnish to the Trustee a Treasurer’s
Certificate stating that notice of redemption of such Bonds on a specified date
has been given as heretofore provided, or that arrangements have been made
insuring to the satisfaction of the Trustee that the notice will be given or,
in lieu of such arrangements, shall deliver to the Trustee a written instrument
executed by the Company and expressed to be irrevocable, authorizing the
Trustee to cause the mailing of such notice for and on behalf of the Company,
and”

 

(d)  Clause (c) of
Section 3 of Article Ten shall be amended by deleting the word “publications”
in the fourth line thereof and inserting the phrase “mailing of notice of
redemption.”

 

(e)  Section 5
of Article Ten shall be amended in its entirety to read as follows:

 

“SECTION 5.                          Except as may be otherwise provided in any indenture
supplemental hereto, at any time, upon the written request of the Company,
expressed by a Treasurer’s Certificate, the Trustee shall, to the extent that
such Bonds are available for such purchase, apply all or any part of the cash
held by it under any provision of this Indenture (except moneys deposited for
the payment or redemption of a particular series of Bonds) to the purchase of
Bonds then outstanding hereunder of such series as the Company may
designate.  Before making any such
purchase the Trustee may, and upon request of the Company shall, by notice
published once in one daily newspaper of general circulation in the Borough of
Manhattan, The City of New York, customarily published on each Business Day,
whether or not published on Saturdays, Sundays or holidays, advertise for
written proposals (to be received by it on or before a specified date) to sell
to it on or before a subsequent specified date Bonds of the series 

 

27

 

designated by the Company then outstanding hereunder,
and the Trustee, to the extent, as nearly as is possible, of such funds then in
its hands and requested by the Company to be so applied, shall purchase the
Bonds so offered at the price or prices most favorable to the Company, and
reasonable notice shall be mailed by the Trustee to the holder or holders of
the Bonds whose proposals shall have been accepted.  The Trustee shall, upon request of the
Company, invite offers of Bonds for sale to it in any other usual manner.  The Trustee, upon request of the Company,
shall reject any or all proposals in whole or in part if on the same day after
opening said proposals the Company has notified the Trustee that the Trustee
can purchase the requisite amount of such Bonds or any part thereof at a price
more favorable to the Company than it could by accepting said proposals. All
offers by holders shall be subject to acceptance of a proposal thereof unless
otherwise expressed in the offers and all advertisements for written proposals
shall so state.”

 

SECTION 9                                                                                            Effective on a date fixed as provided in Section 1
of this Article Four, Section 3 of Article Fifteen of the First
Mortgage as amended shall be restated its entirety to read as follows:

 

“SECTION 3.                          Unless, in the case of a consolidation, merger,
conveyance or other transfer contemplated by Section 1 of this Article Fifteen,
the indenture or instrument of assumption that may be executed by the successor
corporation as in Sections 1 and 2 of this Article Fifteen provided, or in
Article Eighteen expressly provided otherwise, neither this Indenture nor
such indenture or instrument of assumption shall become or be, or be required
to become or be, a lien upon any of the properties:

 

(a)                                  owned by the successor corporation or any
other party to such transaction (other than the Company) immediately prior to
the time of effectiveness of such transaction or

 

(b)                                 acquired
by the successor corporation at or after the time of effectiveness of such
transaction, except, in either case, properties acquired from the Company in or
as a result of such transaction and improvements, extensions and additions to
such properties and renewals, replacements and substitutions of or for any part
or parts thereof.”

 

SECTION 10                                                                                            Effective on a date fixed as provided in Section 1
of this Article Four, Section 2 of Article Sixteen of the First
Mortgage as amended shall be restated in its entirety to read as follows:

 

“SECTION 2.                          (a)                                  No resignation or removal of the Trustee
and no appointment of a successor Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor Trustee
in accordance with the applicable requirements of Section 4 of this Article Sixteen.

 

(b)                                 The Trustee may resign at any time by
giving written notice thereof to the Company. 
If the instrument of acceptance by a successor Trustee required by Section 4
of this Article Sixteen shall not have been delivered to the Trustee
within 30 days after the giving of such notice of 

 

28

 

resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.

 

(c)                                  The Trustee may be removed at any time by
an instrument in writing filed with the Trustee and signed by the holders of a
majority in principal amount of the Bonds then outstanding, and a copy of such
instrument shall be delivered to the Company.

 

(d)                                 If at any time:

 

(A)                              the Trustee shall fail to comply with Section 7
of this Article Sixteen after written request therefor by the Company or
by any holder who has been a bona fide holder for at least six months, or

 

(B)                                the Trustee shall cease to be eligible
under Section 5 of this Article Sixteen or Section 310(a) of
the Trust Indenture Act and shall fail to resign after written request therefor
by the Company or by any such holder, or

 

(C)                                the Trustee shall become incapable of
acting or shall be adjudged a bankrupt or insolvent or a receiver of the
Trustee or of its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the purpose
of rehabilitation, conservation or liquidation,

 

then, in any such case, (x) the Company by a
resolution of its Board of Directors may remove the Trustee with respect to all
Bonds or (y), any holder who has been a bona fide holder for at least six
months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Trustee with respect
to all Bonds and the appointment of a successor Trustee or Trustees.

 

If an instrument of acceptance by a successor Trustee
required by Section 4 of this Article Sixteen shall not have been
delivered to the Trustee within 30 days after the giving of such notice of
removal, the Trustee being removed may petition any court of competent
jurisdiction for the appointment of a successor Trustee.

 

(e)                                  If the Trustee shall resign, be removed
or become incapable of acting, or if a vacancy shall occur in the office of
Trustee for any cause (other than as contemplated by clause (y) in subsection (d) or
this Section), the Company, by resolution of its Board of Directors, shall
promptly appoint a successor Trustee or Trustees and shall comply with the
applicable requirements of Section 4 of this Article Sixteen.  If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a successor Trustee
shall be appointed by an instrument in writing filed with the retiring Trustee
and signed by the holders of a majority in principal amount of the Bonds then
outstanding, and a copy of such instrument shall be delivered to the Company,
the successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment in accordance with the applicable requirements of Section 4 of
this Article Sixteen, become the successor Trustee and to that extent
supersede the 

 

29

 

successor Trustee appointed by the Company.  If no successor Trustee shall have been so
appointed by the Company or the holders and accepted appointment in the manner
required by Section 4 of this Article Sixteen, any holder who has
been a bona fide holder of a Bond for at least six months may, on behalf of
itself and all others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee.

 

(f)                                    So long as no event which is, or after
notice or lapse of time, or both, would become, a completed default shall have
occurred and be continuing, and except with respect to a Trustee appointed by
the holders of a majority in principal amount of the Bonds then outstanding
pursuant to subsection (e) of this Section, if the Company shall have
delivered to the Trustee (i) resolutions of its Board of Directors
appointing a successor Trustee, effective as of a date specified therein, and (ii) an
instrument of acceptance of such appointment, effective as of such date, by
such successor Trustee in accordance with Section 4 of this Article Sixteen,
the Trustee shall be deemed to have resigned as contemplated in subsection (b) of
this Section, the successor Trustee shall be deemed to have been appointed by
the Company pursuant to subsection (e) of this Section and such
appointment shall be deemed to have been accepted as contemplated in Section 4
of this Article Sixteen, all as of such date, and all other provisions of
this Section and Section 4 of this Article Sixteen shall be
applicable to such resignation, appointment and acceptance except to the extent
inconsistent with this subsection (f).

 

(g)                                 The Company shall mail notice of each
resignation and each removal of the Trustee and each appointment of a successor
Trustee to all holders of Bonds at the address of such holder as it appears in
the registry books.  Each notice shall
include the name of the successor Trustee and the address of its corporate
trust office.”

 

SECTION 11                                                                                         Effective on a date fixed as provided in Section 1
of this Article Four, Section 3 of Article Sixteen of the First
Mortgage as amended shall be restated in its entirety to read as follows:

 

“SECTION 3.                          Any corporation into which the Trustee may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto.  In
case any Bonds shall have been authenticated, but not delivered, by the Trustee
then in office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the Bonds so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Bonds.”

 

SECTION 12                                                                                            Effective on a date fixed as provided in Section 1
of this Article Four, Section 4 of Article Sixteen of the First
Mortgage as amended shall be restated in its entirety to read as follows:

 

30

 

“SECTION 4.                          (a) In case of the appointment hereunder of a
successor Trustee, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of all sums owed to it, execute and deliver an instrument transferring
to such successor Trustee all the rights, powers and trusts of the retiring
Trustee and shall duly assign, transfer and deliver to such successor Trustee
all property and money held by such retiring Trustee hereunder, subject
nevertheless to its lien to secure the amounts due to such retiring Trustee
provided for in Section 1 of this Article Sixteen.

 

(b)                                 Upon request of any such successor
Trustee, the Company shall execute any instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such rights, powers and
trusts referred to in subsection (a) of this Section.

 

(c)                                  No successor Trustee shall accept its
appointment unless at the time of such acceptance such successor Trustee shall
be qualified and eligible under this Article.”

 

SECTION 13                                                                                      Effective on a date fixed as provided in Section 1
of this Article Four, Section 2 of Article Eighteen of the First
Mortgage as amended shall be amended to (i) replace the phrase “at least
seventy-five per centum (75%)” with the phrase “a majority” in all places where
such phrase appears therein, (ii) delete the first sentence of the second
paragraph thereof and replace it with the sentence reading as follows:

 

“If at any time the Company shall request the Trustee to enter into any
supplemental indenture pursuant to the provisions of this Section, the Company
shall cause notice of the proposed execution of such supplemental indenture to
be mailed to the registered owners of any Bonds entitled to approve or consent
thereto at their addresses appearing on the bond registry books.”;

 

and (iii) delete the words “first publication” from the second
line of the third paragraph thereof and replace it with the words “the mailing”.

 

SECTION 14                                                                                        Effective on a date fixed as provided in Section 1
of this Article Four, Section 3 of Article Twenty-One of the First
Mortgage as amended shall be restated in its entirety to read as follows:

 

“SECTION 3.                          Any money deposited with the Trustee or any paying
agent, or then held by the Company, in trust for the payment of the principal
of and premium, if any, or interest, if any, on any Bond and remaining
unclaimed for two years after such principal and premium, if any, or interest,
if any, has become due and payable shall to the extent permitted by law be paid
to the Company upon a written request of the Company, or, if then held by the
Company, shall be discharged from such trust; and, upon such payment or
discharge, the holder of such Bond shall, as an unsecured general creditor and
not as the holder of an outstanding Bond, look only to the Company for payment
of the amount so due 

 

31

 

and payable and remaining unpaid unless the applicable
law provides otherwise, and all liability of the Trustee or such paying agent
with respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
paying agent, before being required to make any such payment to the Company,
may at the expense of the Company cause to be mailed, on one occasion only,
notice to such holder that such money remains unclaimed and that, after a date
specified therein, which shall not be less than thirty (30) days from the date
of such mailing, any unclaimed balance of such money then remaining will be
paid to the Company.”

 

SECTION 15                                                                                        Any supplemental indentures may contain
such other provisions as may be necessary or appropriate to carry into effect
the purposes of the amendments provided for by this Article Four or as may
be otherwise appropriate and permissible under the provisions of Article Eighteen
of the First Mortgage as amended to accomplish the purposes of said
amendments.  To the extent permitted by Article Eighteen
of the First Mortgage as amended, any supplemental indenture may terminate or
modify specified obligations of the Company to the holders of the Bonds of a
particular series and such amendment will only require the consent by holders
of seventy-five per centum (75%) in aggregate principal amount of the Bonds
outstanding of said series.  Said
amendments may effect the purposes herein contemplated either by adding
provisions to, or eliminating provisions from, the First Mortgage as amended,
or by both adding and eliminating provisions, or may accomplish said purposes
in any other appropriate manner.

 

No further consent of the holders of New Bonds shall be required to
effect any of the amendments provided for in, or permitted by, this Article Four.

 

ARTICLE FIVE

 

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-Third 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-Third 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-Third 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 SIX

 

MISCELLANEOUS.

 

32

 

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-Third Supplemental Indenture.

 

SECTION 2                                                                                        The provisions of this Forty-Third
Supplemental Indenture shall become effective immediately upon the execution
and delivery hereof, except that the provisions of Article Four of this
Forty-Third Supplemental Indenture modifying and amending the First Mortgage as
amended shall become effective on the date or dates fixed as provided in said Article Four.
From and after the initial issue of the New Bonds, this Forty-Third
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-Third 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-Third Supplemental Indenture, the First Mortgage 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-Third 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-Third Supplemental Indenture in the same manner as though set out herein
at length.  All representations and
recitals contained in this Forty-Third 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-Third Supplemental Indenture, shall, respectively, have the meanings set
forth in said Article One.

 

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

 

33

 

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.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
							

 

34

 

	
   

  	
   

  	
  THE BANK OF NEW YORK,

  
	
   

  	
   

  	
  as Trustee

  
	
   

  	
  By

  	
  /s/ Patricia Gallagher

  	
   

  
	
   

  	
   

  	
  Patricia Gallagher

  
	
   

  	
   

  	
  Vice President

  
	
   

  	
   

  
	
  [SEAL]

  	
   

  
	
   

  	
   

  
	
  Attest:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Mary
  LaGumina

  	
   

  	
   

  
	
  Name: Mary
  LaGumina

  	
   

  
	
  Title: Vice
  President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signed and
  acknowledged in our presence by

  	
   

  
	
  The Bank of New
  York.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
							

 

35

 

	
  STATE OF OHIO,

  	
  )

  	
  ss.:

  
	
  COUNTY OF
  MONTGOMERY,

  	
  )

  	
   

  

 

On this 17th day of August, 2005, 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]

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TIMOTHY G. RICE, Attorney at Law

  
	
   

  	
  Notary Public, State of Ohio

  
	
   

  	
  My Commission has no expiration date,

  
	
   

  	
  Section 147.03 O.R.C.

  

 

36

 

	
  STATE OF NEW
  YORK,

  	
  )

  	
  ss.:

  
	
  COUNTY OF NEW
  YORK,

  	
   

  	
  )

  

 

On this 17th day of August, 2005, personally appeared
before me, a Notary Public within and for said County in the State aforesaid,
Patricia Gallagher and Mary LaGumina, to me known and known to me to be,
respectively, a Vice President and a 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 Vice President for and on behalf of said corporation and that the same is
their free act and deed as such Vice President and Vice President,
respectively, and the free and corporate act and deed of said corporation; and
said Patricia Gallagher being by me duly sworn, did depose and say: that she
resides in                              ;
that she is a Vice President of THE BANK OF NEW YORK, one of the corporations
described in and which executed the above instrument; that she 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 she signed his name thereto by like order.

 

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

 

	
  [SEAL]

  
	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Notary Public, State of New York

  
	
   

  	
  No.

  	
   

  	
   

  
	
   

  	
  Qualified in Bronx County

  
	
   

  	
  Certificate filed in New York County

  
	
   

  	
  Commission Expires 

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  This instrument prepared by

  
	
   

  	
   

  	
   

  
	
   

  	
  Timothy G. Rice, Esq.

  
	
   

  	
  Attorney at Law

  
	
   

  	
  The Dayton Power and Light Company

  
	
   

  	
  1065 Woodman Drive

  
	
   

  	
  Dayton, Ohio 45432

  
							

 

37

 

EXHIBIT A

 

[FORM OF NEW
WATER BOND]

 

	
  No.

  	
   

  	
  $

  	
   

  	
   

  

 

THE DAYTON POWER AND LIGHT COMPANY

(Incorporated under the laws of the State of Ohio)

 

First Mortgage Bond,

4.80%  Pollution Control Series 2005-A
Due 2034

Due January 1, 2034

 

THE DAYTON POWER AND
LIGHT COMPANY, a corporation of the State of Ohio (hereinafter called the
Company), for value received, hereby promises to pay to                                               
or registered assigns, on January 1, 2034, at the office or agency of the
Company in the Borough of Manhattan, The City of New York,                                                             
Dollars 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, and to
pay to the registered owner hereof interest thereon from the interest payment
date to which interest has been paid last preceding the date hereof (unless the
date hereof is an interest payment date to which interest has been paid, in
which case from the date hereof, or unless the date hereof is prior to January 1,
2006, in which case from August 17, 2005), at the rate of Four and Eighty
Hundredths per centum (4.80%) per annum in like coin or currency, payable at
said office or agency semiannually on January 1 and July 1 in each
year, and at maturity, until the Company’s obligation with respect to the
payment of such principal shall have been discharged, such interest to be paid
to the person who shall have been the registered owner hereof at the close of
business on the Business Day (as defined in Section 3 of Article One
of the Forty-Third Supplemental Indenture referred to below) immediately
preceding such January 1 or July 1, as the case may be (subject to
certain exceptions provided in the Forty-Third Supplemental Indenture referred
to herein).  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 this Bond
is not a Business Day, 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.

 

This Bond is one of an
issue of First Mortgage Bonds (hereinafter called the Bonds) of the Company
issued and to be issued in series under and pursuant to and equally secured by
an indenture of mortgage and deed of trust dated as of October 1, 1935, executed
by the Company to Irving Trust Company, as Trustee (now The Bank of New York),
as said indenture has been amended and supplemented as hereinafter stated, and
is one of a series of said First Mortgage 

 

38

 

Bonds, which series is
designated as the First Mortgage Bonds, 4.80% Pollution Control Series 2005-A
Due 2034, of the Company (hereinafter called the New Water Bonds) created and
described in a Forty-Third Supplemental Indenture dated as of August 1, 2005,
executed by the Company to The Bank of New York, as Trustee.  Subsequent to the execution and delivery of
said indenture of mortgage and deed of trust there have been executed and
delivered forty-three indentures supplemental thereto, including said Forty-Third
Supplemental Indenture dated as of August 1, 2005, supplementing and
amending as therein set forth certain provisions thereof.  Said indenture of mortgage and deed of trust
and such supplemental indentures collectively are hereinafter sometimes called
the “Indenture”.

 

For a description of the
property mortgaged and pledged, the nature and extent of the security, the
rights of the holders of the Bonds and of the Trustee therein and thereto, the
duties and immunities of the Trustee, and the terms and conditions upon which
the Bonds are issued and secured, reference is hereby made to the
Indenture.  The rights and obligations of
the Company and of the holders and registered owners of the Bonds of this issue
may be modified or amended at the request of the Company by an indenture or
indentures supplemental to the Indenture, executed pursuant to the consent in
writing of the holders or registered owners of at least 75% in principal amount
of the Bonds then outstanding affected by such modification or amendment, all
in the manner and subject to the limitations set forth in the Indenture, any
consent by the holder or registered owner of any Bond being conclusive and
binding upon such holder or registered owner and upon all future holders and
owners of such Bond, irrespective of whether or not any notation of such
consent is made upon such Bond; provided that no such modification or amendment
by such supplemental indenture shall extend the maturity of, or reduce the rate
of interest on, or otherwise modify the terms of payment of the principal or
interest of, this Bond, which obligations are absolute and unconditional, nor
permit the creation of any lien ranking prior to or equal with the lien of the
Indenture on any of the mortgaged property. 
The New Water Bonds are to be issued by the Company to the Ohio Water
Development Authority (hereinafter called the Water Authority) to evidence and
secure the obligations of the Company to repay the loan of the proceeds of the
sale of the Water Project Bonds (as hereinafter defined) made by the Water
Authority to the Company, pursuant to a certain Loan Agreement, dated as of August 1,
2005, between the Water Authority and the Company, to assist in the refinancing
of the Company’s portion of the cost of acquisition, construction and
installation of certain waste water facilities and solid waste facilities (as
such terms are defined and used in Sections 6121.01 and 6123.01, respectively,
of the Ohio Revised Code) installed in connection with Unit 2 of the Killen
Generating Station located in Adams County, Ohio as to which the Company at the
date of the Forty-Third Supplemental Indenture owned an undivided 67% interest
as tenant in common with another public utility company, the O. H. Hutchings
Generating Station located in Montgomery County, Ohio as to which the Company
at the date hereof owns 100% of the station, and the J. M. Stuart Generating
Station located in Brown County, Ohio as to which the Company at the date
hereof owns an undivided 35% interest as a tenant in common with two other
public utilities (such interests in said facilities being hereinafter called
the Water Project).  The loan by the
Water Authority in respect of the Water Project is to be funded by the proceeds
derived from the sale by the Water Authority of State of Ohio Collateralized
Water Development Revenue Refunding Bonds, 2005 Series A (The Dayton Power
and Light Company Project) in the aggregate principal amount of $41,300,000
(hereinafter called the Water Project Bonds). 
The Water Project Bonds are to be issued under a certain Trust
Indenture, dated as of August 1, 2005 (hereinafter called the Water
Pollution Control Indenture), between the Water Authority and The 

 

39

 

Bank of New York, as
Trustee (hereinafter in such capacity called the Water Project Bond Trustee)
and the New Water Bonds are to be assigned by the Water Authority to the Water
Project Bond Trustee as security for the payment of the principal of and
interest on the Water Project Bonds and are to be delivered by the Company on
behalf of the Water Authority directly to the Water Project Bond Trustee.

 

In the event any Water
Project Bonds shall be surrendered to the Water Project Bond Trustee for
cancellation pursuant to the Water Pollution Control Indenture (except upon
exchange for other Water Project Bonds), New Water Bonds equivalent in
principal amount to such Water Project Bonds shall be deemed to have been paid,
but only when and to the extent (a) so noted on the schedule of
payments hereon by an agency of the Company and (if such agency is not the
Trustee) written notice by such agency of such notation has been received by
the Trustee or (b) such New Water Bond is surrendered to and canceled by
the Trustee as provided in the next paragraph; and in the event and to the
extent the principal of or interest on any Water Project Bonds shall be paid or
deemed to be paid, an equal amount of principal or interest, as the case may
be, payable with respect to an aggregated principal amount of New Water Bonds
equal to the aggregate principal amount of such Water Project Bonds shall be
deemed to have been paid, but, in the case of such payment of principal, only
when and to the extend (i) so noted on the schedule of payments
hereon by an agency of the Company and (if such agency is not the Trustee)
written notice by such agency of such notation has been received by the Trustee
or (ii) such New Water Bond is surrendered to and canceled by the Trustee
as provided in the next paragraph.  When
any such payment of principal of this Bond is made, it shall be surrendered by
the registered owner hereof to an agency of the Company for such notation and
notification or to the Trustee for cancellation.

 

In the event that this
Bond shall be deemed to have been paid in full, this Bond shall be surrendered
to the Trustee for cancellation.  In the
event that this Bond shall be deemed to have been paid in part, this Bond may,
at the option of the registered owner, be surrendered to the Trustee for
cancellation, in which event the Trustee shall cancel this Bond and the Company
shall execute and the Trustee shall authenticate and deliver New Water Bonds in
authorized denominations in aggregate principal amount equal to the unpaid
balance of the principal amount of this Bond.

 

The New Water Bonds are
subject to mandatory redemption by the Company prior to maturity at any time in
whole or in part as provided in Section 5 of Article One of the
Forty-Third Supplemental Indenture at a redemption price of 100% of the principal
amount to be redeemed, plus accrued interest to the redemption date.

 

The New Water Bonds are
subject to optional redemption by the Company prior to maturity at any time in
whole or in part as provided in Section 6 of Article One of the
Forty-Third Supplemental Indenture at a redemption price equal to 100% of the
principal amount to be redeemed, plus accrued interest to the redemption date.

 

The New Water Bonds are
subject to optional redemption by the Company prior to maturity, in whole or in
part by lot as provided in Section 7 of Article One of the
Forty-Third Supplemental Indenture, at a redemption price equal to 100% of the
principal amount to be redeemed, plus accrued interest to the redemption date.

 

40

 

Any redemption of the New
Water Bonds shall be made after written notice to the registered owner of such
New Water Bonds, sent by the Trustee by mail, first class postage prepaid, or
hand delivered at least 30 days and not earlier than 60 days before the
redemption date, unless a shorter notice period is consented to in writing by
the registered owner or owners of all New Water Bonds and such consent is filed
with the Trustee, and shall be made in the manner provided in Article One
of the Forty-Third Supplemental Indenture, subject to the provisions of the
First Mortgage as amended.

 

The principal hereof may
be declared or may become due on the conditions, in the manner and at the time
set forth in the Indenture, upon the happening of a completed default as
provided in the Indenture.

 

This Bond may be
exchanged for a like principal amount of other New Water Bonds, or transferred
as prescribed in the Indenture by the registered owner hereof in person, or by
his duly authorized attorney, at the office or agency of the Company in the
Borough of Manhattan, The City of New York, upon surrender and cancellation of
this Bond and thereupon a new registered New Water Bond or New Water Bonds
without coupons for a like principal amount and of authorized denominations
will be issued in exchange therefore as provided in the Indenture.  The Company and the Trustee may deem and
treat the person in whose name this Bond is registered as the absolute owner
hereof for the purpose of receiving payment of or on account of the principal
and interest due hereon and for all other purposes.

 

No service charge will be
made for any such exchange or transfer of New Water Bonds, but the Company may
require payment of a sum sufficient to cover any stamp tax or other
governmental charge payable in connection therewith.

 

The New Water Bonds are
issuable as registered Bonds without coupons in denominations of $5,000 and any
integral multiple of $5,000.

 

No recourse shall be had
for the payment of the principal of or interest on, this Bond, or under or upon
any obligation, covenant or agreement contained in the Indenture, against any
incorporator, or any past, present, or future subscriber to capital stock,
shareholder, officer or director, as such, of the Company or of any predecessor
or successor corporation, either directly or through the Company or any
predecessor or successor corporation, under any present or future rule of
law, statute or constitution or by the enforcement of any assessment or
otherwise, all such liability of incorporators, subscribers, shareholders,
officers and directors being released by the registered owner hereof by the
acceptance of this Bond and being likewise waived and released by the terms of
the Indenture.

 

This Bond shall not
become valid or obligatory for any purpose until The Bank of New York, the
Trustee under the Indenture, or its successor thereunder, shall have signed the
form of certificate endorsed hereon.

 

IN WITNESS WHEREOF, The
Dayton Power and Light Company has caused this Bond to be executed in its name
by the manual or facsimile signature of its President or any Vice President and
its corporate seal to be hereunto affixed or a facsimile thereof reproduced
hereon and 

 

41

 

attested by the manual or
facsimile signature of its Corporate Secretary or an Assistant Corporate
Secretary.

 

	
  Dated:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE DAYTON POWER AND LIGHT

  COMPANY,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Senior Vice
  President

  
	
   

  	
  and Chief
  Financial Officer

  
	
   

  
	
   

  
	
  Attest:

  	
   

  	
   

  
	
   

  	
  Vice President,
  General Counsel

  	
   

  
	
   

  	
  and Corporate
  Secretary

  	
   

  
						

 

TRUSTEE’S CERTIFICATE

This Bond is one of the
Bonds of the Series designated therein, described in the within-mentioned
Indenture.

 

 

	
   

  	
  THE BANK OF NEW YORK, as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  	
   

  

 

42

 

SCHEDULE OF PAYMENTS

 

	
   

  	
   

  	
  Unpaid

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal

  	
   

  	
  Principal

  	
   

  	
  Interest

  	
   

  	
  Agency of the Company

  	
   

  	
  Authorized

  	
   

  
	
  Payment Amount

  	
   

  	
  Payment

  	
   

  	
  Making Notation

  	
   

  	
  Officer

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

43

 

EXHIBIT B

 

[FORM OF NEW
AIR BOND]

 

 

	
  No.

  	
   

  	
  $

  	
   

  	
   

  

 

 

THE DAYTON POWER AND LIGHT COMPANY

(Incorporated under the laws of the State of Ohio)

 

First Mortgage Bond,

4.80%  Pollution Control Series 2005-B
Due 2034

Due January 1, 2034

 

THE DAYTON POWER AND LIGHT
COMPANY, a corporation of the State of Ohio (hereinafter called the Company),
for value received, hereby promises to pay to                                               
or registered assigns, on January 1, 2034, at the office or agency of the
Company in the Borough of Manhattan, The City of New York,
                                                                  
Thousand Dollars 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, and to pay to the registered owner hereof interest thereon from the
interest payment date to which interest has been paid last preceding the date
hereof (unless the date hereof is an interest payment date to which interest
has been paid, in which case from the date hereof, or unless the date hereof is
prior to January 1, 2006, in which case from August 17, 2005), at the
rate of Four and Eighty Hundredths per centum (4.80%) per annum in like coin or
currency, payable at said office or agency semiannually on January 1 and July 1
in each year, and at maturity, until the Company’s obligation with respect to
the payment of such principal shall have been discharged, such interest to be
paid to the person who shall have been the registered owner hereof at the close
of business on the Business Day (as defined in Section 3 of Article Two
of the Forty-Third Supplemental Indenture referred to below) immediately
preceding such January 1 or July 1, as the case may be (subject to
certain exceptions provided in the Forty-Third Supplemental Indenture referred
to herein).  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 this Bond
is not a Business Day, 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.

 

This Bond is one of an
issue of First Mortgage Bonds (hereinafter called the Bonds) of the Company
issued and to be issued in series under and pursuant to and equally secured by
an indenture of mortgage and deed of trust dated as of October 1, 1935,
executed by the Company to Irving Trust Company, as Trustee (now The Bank of
New York), as said indenture has been amended and supplemented as hereinafter
stated, and is one of a series of said First Mortgage 

 

44

 

Bonds, which series is
designated as the First Mortgage Bonds, 4.80% Pollution Control Series 2005-B
Due 2034, of the Company (hereinafter called the New Air Bonds) created and
described in a Forty-Third Supplemental Indenture dated as of August 1,
2005, executed by the Company to The Bank of New York, as Trustee.  Subsequent to the execution and delivery of
said indenture of mortgage and deed of trust there have been executed and
delivered forty-three indentures supplemental thereto, including said
Forty-Third Supplemental Indenture dated as of August 1, 2005,
supplementing and amending as therein set forth certain provisions
thereof.  Said indenture of mortgage and
deed of trust and such supplemental indentures collectively are hereinafter
sometimes called the “Indenture”.

 

For a description of the
property mortgaged and pledged, the nature and extent of the security, the
rights of the holders of the Bonds and of the Trustee therein and thereto, the
duties and immunities of the Trustee, and the terms and conditions upon which
the Bonds are issued and secured, reference is hereby made to the
Indenture.  The rights and obligations of
the Company and of the holders and registered owners of the Bonds of this issue
may be modified or amended at the request of the Company by an indenture or
indentures supplemental to the Indenture, executed pursuant to the consent in
writing of the holders or registered owners of at least 75% in principal amount
of the Bonds then outstanding affected by such modification or amendment, all
in the manner and subject to the limitations set forth in the Indenture, any
consent by the holder or registered owner of any Bond being conclusive and binding
upon such holder or registered owner and upon all future holders and owners of
such Bond, irrespective of whether or not any notation of such consent is made
upon such Bond; provided that no such modification or amendment by such
supplemental indenture shall extend the maturity of, or reduce the rate of
interest on, or otherwise modify the terms of payment of the principal or
interest of, this Bond, which obligations are absolute and unconditional, nor
permit the creation of any lien ranking prior to or equal with the lien of the
Indenture on any of the mortgaged property. 
The New Air Bonds are to be issued by the Company to the Ohio Air
Quality Development Authority (hereinafter called the Air Authority) to evidence
and secure the obligations of the Company to repay the loan of the proceeds of
the sale of the Air Project Bonds (as hereinafter defined) made by the Air
Authority to the Company, pursuant to a certain Loan Agreement, dated as of August 1,
2005, between the Air Authority and the Company, to assist in the refinancing
of the Company’s portion of the cost of refinancing 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: Unit 2 of 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, the Walter C. Beckjord Generating Station Unit 6 located in
Clermont County, Ohio as to which the Company at the date hereof owns an
undivided 50% interest as tenant in common with another public utility company,
and the William H. Zimmer Generating Station located in Clermont County, Ohio
as to which the Company at the date hereof owns an undivided 28.1% interest as
tenant in common with two other public utility companies (such interests in
said facilities being hereinafter called the Air Project).  The loan by the Air Authority in respect of
the Air Project is to be funded by the proceeds derived from the sale by the
Air Authority of State of Ohio Collateralized Air Quality Development Revenue
Refunding Bonds, 2005 Series B (The Dayton Power and Light Company Project)
in the aggregate principal amount of $137,800,000 (hereinafter called the Air
Project Bonds).  The Air Project Bonds
are to be issued under a certain Trust Indenture, dated as of August 1,
2005 (hereinafter called the Air Pollution Control 

 

45

 

Indenture), between the
Air Authority and The Bank of New York, as Trustee (hereinafter in such
capacity called the Air Project Bond Trustee) and the New Air Bonds are to be
assigned by the Air Authority to the Air Project Bond Trustee as security for
the payment of the principal of and interest on the Air Project Bonds and are
to be delivered by the Company on behalf of the Air Authority directly to the
Air Project Bond Trustee.

 

In the event any Air
Project Bonds shall be surrendered to the Air Project Bond Trustee for
cancellation pursuant to the Air Pollution Control Indenture (except upon
exchange for other Air Project Bonds), New Air Bonds equivalent in principal
amount to such Air Project Bonds shall be deemed to have been paid, but only
when and to the extent (a) so noted on the schedule of payments
hereon by an agency of the Company and (if such agency is not the Trustee)
written notice by such agency of such notation has been received by the Trustee
or (b) such New Air Bond is surrendered to and canceled by the Trustee as
provided in the next paragraph; and in the event and to the extent the
principal of or interest on any Air Project Bonds shall be paid or deemed to be
paid, an equal amount of principal or interest, as the case may be, payable
with respect to an aggregated principal amount of New Air Bonds equal to the
aggregate principal amount of such Air Project Bonds shall be deemed to have
been paid, but, in the case of such payment of principal, only when and to the
extend (i) so noted on the schedule of payments hereon by an agency
of the Company and (if such agency is not the Trustee) written notice by such
agency of such notation has been received by the Trustee or (ii) such New
Air Bond is surrendered to and canceled by the Trustee as provided in the next
paragraph.  When any such payment of
principal of this Bond is made, it shall be surrendered by the registered owner
hereof to an agency of the Company for such notation and notification or to the
Trustee for cancellation.

 

In the event that this
Bond shall be deemed to have been paid in full, this Bond shall be surrendered
to the Trustee for cancellation.  In the
event that this Bond shall be deemed to have been paid in part, this Bond may,
at the option of the registered owner, be surrendered to the Trustee for
cancellation, in which event the Trustee shall cancel this Bond and the Company
shall execute and the Trustee shall authenticate and deliver New Air Bonds in
authorized denominations in aggregate principal amount equal to the unpaid
balance of the principal amount of this Bond.

 

The New Air Bonds are
subject to mandatory redemption by the Company prior to maturity at any time in
whole or in part as provided in Section 5 of Article Two of the Forty-Third
Supplemental Indenture at a redemption price of 100% of the principal amount to
be redeemed, plus accrued interest to the redemption date.

 

The New Air Bonds are
subject to optional redemption by the Company prior to maturity at any time in
whole or in part as provided in Section 6 of Article Two of the
Forty-Third Supplemental Indenture at a redemption price equal to 100% of the
principal amount to be redeemed, plus accrued interest to the redemption date.

 

The New Air Bonds are
subject to optional redemption by the Company prior to maturity in whole or in
part by lot as provided in Section 7 of Article Two of the
Forty-Third Supplemental Indenture, at a redemption price equal to 100% of the
principal amount to be redeemed, plus accrued interest to the redemption date.

 

46

 

Any redemption of the New
Air Bonds shall be made after written notice to the registered owner of such
New Air Bonds, sent by the Trustee by mail, first class postage prepaid, or hand
delivered at least 30 days and not earlier than 60 days before the redemption
date, unless a shorter notice period is consented to in writing by the
registered owner or owners of all New Air Bonds and such consent is filed with
the Trustee, and shall be made in the manner provided in Article Two of
the Forty-Third Supplemental Indenture, subject to the provisions of the First
Mortgage as amended.

 

The principal hereof may
be declared or may become due on the conditions, in the manner and at the time
set forth in the Indenture, upon the happening of a completed default as
provided in the Indenture.

 

This Bond may be
exchanged for a like principal amount of other New Air Bonds, or transferred as
prescribed in the Indenture by the registered owner hereof in person, or by his
duly authorized attorney, at the office or agency of the Company in the Borough
of Manhattan, The City of New York, upon surrender and cancellation of this
Bond and thereupon a new registered New Air Bond or New Air Bonds without coupons
for a like principal amount and of authorized denominations will be issued in
exchange therefore as provided in the Indenture.  The Company and the Trustee may deem and
treat the person in whose name this Bond is registered as the absolute owner
hereof for the purpose of receiving payment of or on account of the principal
and interest due hereon and for all other purposes.

 

No service charge will be
made for any such exchange or transfer of New Air Bonds, but the Company may
require payment of a sum sufficient to cover any stamp tax or other
governmental charge payable in connection therewith.

 

The New Air Bonds are
issuable as registered Bonds without coupons in denominations of $5,000 and any
integral multiple of $5,000.

 

No recourse shall be had
for the payment of the principal of or interest on, this Bond, or under or upon
any obligation, covenant or agreement contained in the Indenture, against any
incorporator, or any past, present, or future subscriber to capital stock,
shareholder, officer or director, as such, of the Company or of any predecessor
or successor corporation, either directly or through the Company or any
predecessor or successor corporation, under any present or future rule of
law, statute or constitution or by the enforcement of any assessment or
otherwise, all such liability of incorporators, subscribers, shareholders,
officers and directors being released by the registered owner hereof by the
acceptance of this Bond and being likewise waived and released by the terms of
the Indenture.

 

This Bond shall not
become valid or obligatory for any purpose until The Bank of New York, the
Trustee under the Indenture, or its successor thereunder, shall have signed the
form of certificate endorsed hereon.

 

IN WITNESS WHEREOF, The
Dayton Power and Light Company has caused this Bond to be executed in its name
by the manual or facsimile signature of its President or any Vice President and
its corporate seal to be hereunto affixed or a facsimile thereof reproduced
hereon and 

 

47

 

attested by the manual or
facsimile signature of its Corporate Secretary or an Assistant Corporate
Secretary.

 

	
  Dated:

  
	
   

  
	
   

  
	
   

  	
  THE DAYTON POWER AND LIGHT

  COMPANY,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Senior Vice
  President

  
	
   

  	
  and Chief
  Financial Officer

  
	
   

  
	
   

  
	
  Attest:

  	
   

  	
   

  
	
   

  	
  Vice President,
  General Counsel

  	
   

  
	
   

  	
  and Corporate
  Secretary

  	
   

  
						

 

TRUSTEE’S CERTIFICATE

This Bond is one of the
Bonds of the Series designated therein, described in the within-mentioned
Indenture.

 

 

	
   

  	
  THE BANK OF NEW YORK, as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  	
   

  

 

48

 

SCHEDULE OF PAYMENTS

 

	
   

  	
   

  	
  Unpaid

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal

  	
   

  	
  Principal

  	
   

  	
  Interest

  	
   

  	
  Agency of the Company

  	
   

  	
  Authorized

  	
   

  
	
  Payment Amount

  	
   

  	
  Payment

  	
   

  	
  Making Notation

  	
   

  	
  Officer

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

49

 

EXHIBIT C

 

[FORM OF NEW
BOONE COUNTY BOND]

 

 

	
  No.

  	
   

  	
  $

  	
   

  	
   

  

 

 

THE DAYTON POWER AND LIGHT COMPANY

(Incorporated under the laws of the State of Ohio)

 

First Mortgage Bond,

4.70%  Pollution Control Series 2005-C
Due 2028

Due January 1, 2028

 

THE DAYTON POWER AND
LIGHT COMPANY, a corporation of the State of Ohio (hereinafter called the
Company), for value received, hereby promises to pay to                                               
or registered assigns, on January 1, 2028, at the office or agency of the
Company in the Borough of Manhattan, The City of New York,                                                                   
Dollars 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, and to
pay to the registered owner hereof interest thereon from the interest payment
date to which interest has been paid last preceding the date hereof (unless the
date hereof is an interest payment date to which interest has been paid, in
which case from the date hereof, or unless the date hereof is prior to January 1,
2006, in which case from August 17, 2005), at the rate of Four and Seventy
Hundredths per centum (4.70%) per annum in like coin or currency, payable at
said office or agency semiannually on January 1 and July 1 in each
year, and at maturity, until the Company’s obligation with respect to the
payment of such principal shall have been discharged, such interest to be paid
to the person who shall have been the registered owner hereof at the close of
business on the Business Day (as defined in Section 3 of Article Three
of the Forty-Third Supplemental Indenture referred to below) immediately
preceding such January 1 or July 1, as the case may be (subject to
certain exceptions provided in the Forty-Third Supplemental Indenture referred
to herein).  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 this Bond
is not a Business Day, 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.

 

This Bond is one of an
issue of First Mortgage Bonds (hereinafter called the Bonds) of the Company
issued and to be issued in series under and pursuant to and equally secured by
an indenture of mortgage and deed of trust dated as of October 1, 1935,
executed by the Company to Irving Trust Company, as Trustee (now The Bank of
New York), as said indenture has been amended and supplemented as hereinafter
stated, and is one of a series of said First Mortgage 

 

50

 

Bonds, which series is
designated as the First Mortgage Bonds, 4.70% Pollution Control Series 2005-C
Due 2028, of the Company (hereinafter called the New Boone County Bonds)
created and described in a Forty-Third Supplemental Indenture dated as of August 1,
2005, executed by the Company to The Bank of New York, as Trustee.  Subsequent to the execution and delivery of
said indenture of mortgage and deed of trust there have been executed and
delivered forty-three indentures supplemental thereto, including said
Forty-Third Supplemental Indenture dated as of August 1, 2005,
supplementing and amending as therein set forth certain provisions
thereof.  Said indenture of mortgage and
deed of trust and such supplemental indentures collectively are hereinafter
sometimes called the “Indenture”.

 

For a description of the
property mortgaged and pledged, the nature and extent of the security, the
rights of the holders of the Bonds and of the Trustee therein and thereto, the
duties and immunities of the Trustee, and the terms and conditions upon which
the Bonds are issued and secured, reference is hereby made to the Indenture.  The rights and obligations of the Company and
of the holders and registered owners of the Bonds of this issue may be modified
or amended at the request of the Company by an indenture or indentures
supplemental to the Indenture, executed pursuant to the consent in writing of
the holders or registered owners of at least 75% in principal amount of the
Bonds then outstanding affected by such modification or amendment, all in the
manner and subject to the limitations set forth in the Indenture, any consent
by the holder or registered owner of any Bond being conclusive and binding upon
such holder or registered owner and upon all future holders and owners of such
Bond, irrespective of whether or not any notation of such consent is made upon
such Bond; provided that no such modification or amendment by such supplemental
indenture shall extend the maturity of, or reduce the rate of interest on, or
otherwise modify the terms of payment of the principal or interest of, this
Bond, which obligations are absolute and unconditional, nor permit the creation
of any lien ranking prior to or equal with the lien of the Indenture on any of
the mortgaged property.  The New Boone
County Bonds are to be issued by the Company to Boone County, Kentucky
(hereinafter called Boone County) to evidence and secure the obligations of the
Company to repay the loan of the proceeds of the sale of the Boone County
Project Bonds (as hereinafter defined) made by Boone County to the Company,
pursuant to a certain Loan Agreement, dated as of August 1, 2005, between
Boone County and the Company, to assist in the refinancing of the Company’s
portion of the cost of refinancing of the Company’s portion of the cost of
acquisition, construction and installation of certain solid waste facilities
installed in connection with Unit 2 of the East Bend Generating Station located
in Boone County, Kentucky as to which the Company at the date hereof owns an
undivided 31% interest as tenant in common with another public utility company
(such interest in said facilities being hereinafter called the Boone County
Project).  The loan by Boone County in
respect of the Boone County Project is to be funded by the proceeds derived
from the sale by the County of Boone, Kentucky Collateralized Pollution Control
Revenue Refunding Bonds, 2005 Series A (The Dayton Power and Light Company
Project) in the aggregate principal amount of $35,275,000 (hereinafter called
the Boone County Project Bonds).  The
Boone County Project Bonds are to be issued under a certain Trust Indenture,
dated as of August 1, 2005 (hereinafter called the Boone County Pollution
Control Indenture), between Boone County and The Bank of New York, as Trustee
(hereinafter in such capacity called the Boone County Project Bond Trustee) and
the New Boone County Bonds are to be assigned by Boone County to the Boone
County Project Bond Trustee as security for the payment of the principal of and
interest on the Boone County Project Bonds and are to be 

 

51

 

delivered by the Company
on behalf of Boone County directly to the Boone County Project Bond Trustee.

 

In the event any Boone
County Project Bonds shall be surrendered to the Boone County Project Bond
Trustee for cancellation pursuant to the Boone County Pollution Control Indenture
(except upon exchange for other Boone County Project Bonds), New Boone County
Bonds equivalent in principal amount to such Boone County Project Bonds shall
be deemed to have been paid, but only when and to the extent (a) so noted
on the schedule of payments hereon by an agency of the Company and (if
such agency is not the Trustee) written notice by such agency of such notation
has been received by the Trustee or (b) such New Boone County Bond is
surrendered to and canceled by the Trustee as provided in the next paragraph;
and in the event and to the extent the principal of or interest on any Boone
County Project Bonds shall be paid or deemed to be paid, an equal amount of
principal or interest, as the case may be, payable with respect to an aggregated
principal amount of New Boone County Bonds equal to the aggregate principal
amount of such Boone County Project Bonds shall be deemed to have been paid,
but, in the case of such payment of principal, only when and to the extend (i) so
noted on the schedule of payments hereon by an agency of the Company and
(if such agency is not the Trustee) written notice by such agency of such
notation has been received by the Trustee or (ii) such New Boone County
Bond is surrendered to and canceled by the Trustee as provided in the next
paragraph.  When any such payment of
principal of this Bond is made, it shall be surrendered by the registered owner
hereof to an agency of the Company for such notation and notification or to the
Trustee for cancellation.

 

In the event that this
Bond shall be deemed to have been paid in full, this Bond shall be surrendered
to the Trustee for cancellation.  In the
event that this Bond shall be deemed to have been paid in part, this Bond may,
at the option of the registered owner, be surrendered to the Trustee for
cancellation, in which event the Trustee shall cancel this Bond and the Company
shall execute and the Trustee shall authenticate and deliver New Boone County
Bonds in authorized denominations in aggregate principal amount equal to the
unpaid balance of the principal amount of this Bond.

 

The New Boone County
Bonds are subject to mandatory redemption by the Company prior to maturity at
any time in whole or in part as provided in Section 5 of Article Three
of the Forty-Third Supplemental Indenture at a redemption price of 100% of the
principal amount to be redeemed, plus accrued interest to the redemption date.

 

The New Boone County
Bonds are subject to optional redemption by the Company prior to maturity at
any time in whole or in part as provided in Section 6 of Article Three
of the Forty-Third Supplemental Indenture at a redemption price equal to 100%
of the principal amount to be redeemed, plus accrued interest to the redemption
date.

 

The New Boone County
Bonds are subject to optional redemption by the Company prior to maturity in
whole or in part by lot as provided in Section 7 of Article Three of
the Forty-Third Supplemental Indenture, at a redemption price equal to 100% of
the principal amount to be redeemed, plus accrued interest to the redemption
date.

 

52

 

Any redemption of the New
Boone County Bonds shall be made after written notice to the registered owner
of such New Boone County Bonds, sent by the Trustee by mail, first class postage
prepaid, or hand delivered at least 30 days and not earlier than 60 days before
the redemption date, unless a shorter notice period is consented to in writing
by the registered owner or owners of all New Boone County Bonds and such
consent is filed with the Trustee, and shall be made in the manner provided in Article Three
of the Forty-Third Supplemental Indenture, subject to the provisions of the
First Mortgage as amended.

 

The principal hereof may
be declared or may become due on the conditions, in the manner and at the time
set forth in the Indenture, upon the happening of a completed default as
provided in the Indenture.

 

This Bond may be
exchanged for a like principal amount of other New Boone County Bonds, or
transferred as prescribed in the Indenture by the registered owner hereof in
person, or by his duly authorized attorney, at the office or agency of the
Company in the Borough of Manhattan, The City of New York, upon surrender and
cancellation of this Bond and thereupon a new registered New Boone County Bond
or New Boone County Bonds without coupons for a like principal amount and of
authorized denominations will be issued in exchange therefore as provided in
the Indenture.  The Company and the
Trustee may deem and treat the person in whose name this Bond is registered as
the absolute owner hereof for the purpose of receiving payment of or on account
of the principal and interest due hereon and for all other purposes.

 

No service charge will be
made for any such exchange or transfer of New Boone County Bonds, but the
Company may require payment of a sum sufficient to cover any stamp tax or other
governmental charge payable in connection therewith.

 

The New Boone County
Bonds are issuable as registered Bonds without coupons in denominations of $5,000
and any integral multiple of $5,000.

 

No recourse shall be had
for the payment of the principal of or interest on, this Bond, or under or upon
any obligation, covenant or agreement contained in the Indenture, against any
incorporator, or any past, present, or future subscriber to capital stock,
shareholder, officer or director, as such, of the Company or of any predecessor
or successor corporation, either directly or through the Company or any
predecessor or successor corporation, under any present or future rule of
law, statute or constitution or by the enforcement of any assessment or
otherwise, all such liability of incorporators, subscribers, shareholders,
officers and directors being released by the registered owner hereof by the
acceptance of this Bond and being likewise waived and released by the terms of
the Indenture.

 

This Bond shall not
become valid or obligatory for any purpose until The Bank of New York, the
Trustee under the Indenture, or its successor thereunder, shall have signed the
form of certificate endorsed hereon.

 

IN WITNESS WHEREOF, The
Dayton Power and Light Company has caused this Bond to be executed in its name
by the manual or facsimile signature of its President or any Vice President and
its corporate seal to be hereunto affixed or a facsimile thereof reproduced
hereon and 

 

53

 

attested by the manual or
facsimile signature of its Corporate Secretary or an Assistant Corporate
Secretary.

 

 

	
  Dated:

  
	
   

  
	
   

  
	
   

  	
  THE DAYTON POWER AND LIGHT

  COMPANY,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Senior Vice
  President

  
	
   

  	
  and Chief
  Financial Officer

  
	
   

  
	
   

  
	
  Attest:

  	
   

  	
   

  
	
   

  	
  Vice President,
  General Counsel

  	
   

  
	
   

  	
  and Corporate
  Secretary

  	
   

  
						

 

TRUSTEE’S CERTIFICATE

 

This Bond is one of the
Bonds of the Series designated therein, described in the within-mentioned
Indenture.

 

	
   

  	
  THE BANK OF NEW YORK, as Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  	
   

  

 

54

 

SCHEDULE OF PAYMENTS

 

	
   

  	
   

  	
  Unpaid

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Principal

  	
   

  	
  Principal

  	
   

  	
  Interest

  	
   

  	
  Agency of the Company

  	
   

  	
  Authorized

  	
   

  
	
  Payment Amount

  	
   

  	
  Payment

  	
   

  	
  Making Notation

  	
   

  	
  Officer

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

55================================================================================
                                                                    Exhibit 4.7

                                    DPL INC.

                                       AND

                              THE BANK OF NEW YORK

                                     TRUSTEE

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

                                    INDENTURE

                           DATED AS OF AUGUST 31, 2001

                         JUNIOR SUBORDINATED DEBENTURES

================================================================================

<PAGE>

                          Reconciliation and Tie Sheet*
                                     between
            Provisions of the Trust Indenture Act of 1939, as amended
                                       and
                      Indenture Dated as of August 31, 2001
                                     between
                                    DPL Inc.
                                       and
                          The Bank of New York, Trustee

Section of Act                               Section of Indenture
--------------                               --------------------

  310(a)(1)                                       7.09
  310(a)(2)                                       7.09
  310(a)(3)                                       Inapplicable
  310(a)(4)                                       Inapplicable
  310(b)                                          7.08, 7.10
  310(c)                                          Inapplicable
  311(a)                                          7.13(a), 7.13(c)
  311(b)                                          7.13(b), 7.13(c)
  311(c)                                          Inapplicable
  312(a)                                          5.01, 5.02(a)
  312(b)                                          5.02(b)
  312(c)                                          5.03(c)
  313(a)                                          5.04(a)
  313(b)(1)                                       Inapplicable
  313(b)(2)                                       5.04(b)
  313(c)                                          5.04(c)
  313(d)                                          5.04(d)
  314(a)(1)                                       5.03(a)
  314(a)(2)                                       5.03(b)
  314(a)(3)                                       5.03(c)
  314(a)(4)                                       4.06
  314(b)                                          Inapplicable
  314(c)(1)                                       16.04
  314(c)(2)                                       16.04
  314(c)(3)                                       Inapplicable
  314(d)                                          Inapplicable
  314(e)                                          16.04
  314(f)                                          Omitted
  315(a)                                          7.01
  315(b)                                          6.07
  315(c)                                          7.01
  315(d)                                          7.01
  315(e)                                          6.08
  316(a)(1)                                       6.06, 8.04
  316(a)(2)                                       Omitted

                                       i
<PAGE>

  316(b)                                          6.04
  316(c)                                          10.05
  317(a)                                          6.02
  317(b)                                          4.04
  318(a)                                          15.06

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

* This Reconciliation and Tie Sheet is not part of the Indenture.

                                       ii
<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----

                                    ARTICLE I

                                   DEFINITIONS

Section 1.01  Certain Terms Defined...........................................1
              Act.............................................................2
              Additional Interest.............................................2
              Additional Tax Sums.............................................2
              Administrative Trustee..........................................2
              applicants......................................................2
              Authenticating Agent............................................2
              Authorized Newspaper............................................3
              Board of Directors..............................................3
              Business Day....................................................3
              Capital Securities..............................................3
              Capital Stock...................................................3
              Commission......................................................3
              Common Securities...............................................4
              Common Stock....................................................4
              Company.........................................................4
              Depositary......................................................4
              Distributions...................................................4
              DPL Guarantee...................................................4
              DPL Trust.......................................................4
              Event of Default................................................4
              Exchange Act....................................................5
              Extension Period................................................5
              Government Securities...........................................5
              Guarantee Agreement.............................................5
              Indenture.......................................................5
              Investment Company Event........................................5
              Maturity........................................................5
              1940 Act........................................................5
              Officers' Certificate...........................................6
              Opinion of Counsel..............................................6
              Original Issue Date.............................................6
              Original Issue Discount Security................................6
              Paying Agent....................................................6
              Person..........................................................6
              Preferred Securities............................................7
              principal.......................................................7
              Property Trustee................................................7

                                       i
<PAGE>

              Ranking junior to the Securities................................7
              Ranking on a parity with the Securities.........................7
              record date.....................................................7
              Register........................................................8
              Resolution of the Company.......................................8
              Responsible Officer.............................................8
              Rights Plan.....................................................8
              Security or Securities; outstanding.............................8
              Securityholder; registered holder...............................9
              Senior Indebtedness of the Company..............................9
              Stated Maturity.................................................9
              Subsidiary.....................................................10
              Tax Event......................................................10
              Trust Agreement................................................10
              Trustee; Principal Office of the Trustee.......................10
              Trust Indenture Act of 1939....................................11
              Trust Securities...............................................11

                                   ARTICLE II

             ISSUE, DESCRIPTION, EXECUTION, REGISTRATION OF TRANSFER
                           AND EXCHANGE OF SECURITIES

Section 2.01  Amount, Series and Delivery of Securities......................11
Section 2.02  Form of Securities and Trustee's Certificate...................15
Section 2.03  Denominations of and Payment of Interest on Securities.........17
Section 2.04  Execution of Securities........................................17
Section 2.05  Registration, Transfer and Exchange of Securities..............18
Section 2.06  Temporary Securities...........................................20
Section 2.07  Mutilated, Destroyed, Lost or Stolen Securities................20
Section 2.08  Cancellation and Destruction of Surrendered Securities.........21
Section 2.09  Authenticating Agents..........................................21
Section 2.10  Deferrals of Interest Payment Dates............................23
Section 2.11  Right of Set-Off...............................................24
Section 2.12  Shortening or Extension of Stated Maturity.....................24
Section 2.13  Agreed Tax Treatment...........................................25
Section 2.14  CUSIP Numbers..................................................25

                                   ARTICLE III

                            REDEMPTION OF SECURITIES

Section 3.01  Applicability of Article.......................................25
Section 3.02  Mailing of Notice of Redemption................................25
Section 3.03  When Securities Called for Redemption Become Due and Payable...26

                                       ii
<PAGE>

                                   ARTICLE IV

                       PARTICULAR COVENANTS OF THE COMPANY

Section 4.01  Payment of Principal of and Interest on Securities.............27
Section 4.02  Maintenance of Offices or Agencies for  Registration of
              Transfer, Exchange and Payment of Securities...................28
Section 4.03  Appointment to Fill a Vacancy In The Office of Trustee.........28
Section 4.04  Duties of Paying Agent.........................................28
Section 4.05  Further Assurances.............................................29
Section 4.06  Officers' Certificate As to Defaults; Notices of
              Certain Defaults...............................................29
Section 4.07  Waiver of Covenants............................................29
Section 4.08  Additional Tax Sums............................................30
Section 4.09  Additional Covenants...........................................30
Section 4.10  Calculation of Original Issue Discount.........................31

                                    ARTICLE V

                SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY
                                 AND THE TRUSTEE

Section 5.01  Company to Furnish Trustee Information As to The Names
              and Addresses of Securityholders...............................31
Section 5.02  Trustee to Preserve Information As to The Names and
              Addresses of Securityholders Received By It....................32
Section 5.03  Annual and Other Reports to Be Filed By Company With Trustee...33
Section 5.04  Trustee to Transmit Annual Report to Securityholders...........33

                                   ARTICLE VI

                   REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
                               ON EVENT OF DEFAULT

Section 6.01  Events of Default Defined......................................35
Section 6.02  Covenant of Company to Pay to Trustee Whole Amount Due
              On Securities On Default In Payment of Interest or Principal...37
Section 6.03  Application of Moneys Collected By Trustee.....................39
Section 6.04  Limitation On Suits By Holders of Securities...................40
Section 6.05  On Event of Default Trustee May Take Appropriate Action........40
Section 6.06  Rights of Holders of Majority In Principal Amount of
              Securities to Direct Trustee and to Waive Default..............41
Section 6.07  Trustee to Give Notice of Defaults Known to It, But May
              Withhold In Certain Circumstances..............................41
Section 6.08  Requirement of An Undertaking to Pay Costs In Certain
              Suits Under The Indenture or Against The Trustee...............42

                                      iii
<PAGE>

                                   ARTICLE VII

                             CONCERNING THE TRUSTEE

Section 7.01  Upon Event of Default Occurring and Continuing, Trustee Shall
              Exercise Powers Vested In It, and Use Same Degree of Care
              and Skill In Their Exercise, As A Prudent Man Would Use........42
Section 7.02  Reliance On Documents, Opinions, Etc...........................44
Section 7.03  Trustee Not Liable for  Recitals In Indenture or
              In Securities..................................................45
Section 7.04  May Hold Securities............................................45
Section 7.05  Moneys Received By Trustee to Be Held In Trust Without
              Interest.......................................................45
Section 7.06  Trustee Entitled to Compensation, Reimbursement and Indemnity..46
Section 7.07  Right of Trustee to Rely On Officers' Certificate Where No
              Other Evidence Specifically Prescribed.........................46
Section 7.08  Disqualification; Conflicting Interests........................47
Section 7.09  Requirements for Eligibility of Trustee........................47
Section 7.10  Resignation and Removal of Trustee.............................47
Section 7.11  Acceptance By Successor Trustee................................48
Section 7.12  Successor to Trustee By Merger, Consolidation or
              Succession to Business.........................................50
Section 7.13  Limitations On Rights of Trustee As A Creditor to Obtain
              Payment of Certain Claims Within Three Months Prior to Default
              or During Default, or to Realize On Property As Such
              Creditor Thereafter............................................50

                                  ARTICLE VIII

                         CONCERNING THE SECURITYHOLDERS

Section 8.01  Evidence of Action By Securityholders..........................54
Section 8.02  Proof of Execution of Instruments and of Holding of
              Securities.....................................................54
Section 8.03  Who May Be Deemed Owners of Securities.........................54
Section 8.04  Securities Owned By Company or Controlled or Controlling
              Persons Disregarded for Certain Purposes.......................55
Section 8.05  Instruments Executed By Securityholders Bind Future Holders....55

                                   ARTICLE IX

                            SECURITYHOLDERS' MEETINGS

Section 9.01  Purposes for  Which Meetings May Be Called.....................56
Section 9.02  Manner of Calling Meetings.....................................56
Section 9.03  Call of Meeting By Company or Securityholders..................56
Section 9.04  Who May Attend and Vote At Meetings............................57
Section 9.05  Regulations May Be Made By Trustee.............................57
Section 9.06  Manner of Voting At Meetings and Record to Be Kept.............58
Section 9.07  Exercise of Rights of Trustee, Securityholders and Holders
              of Preferred Securities Not to Be Hindered or Delayed..........58

                                       iv
<PAGE>

                                    ARTICLE X

                             SUPPLEMENTAL INDENTURES

Section 10.01 Purposes for  Which Supplemental Indentures May Be Entered
              Into Without Consent of Securityholders........................58
Section 10.02 Modification of Indenture With Consent of Holders of A
              Majority In Principal Amount of Securities.....................60
Section 10.03 Effect of Supplemental Indentures..............................61
Section 10.04 Securities May Bear Notation of Changes By Supplemental
              Indentures.....................................................62
Section 10.05 Revocation and Effect of Consents..............................62

                                   ARTICLE XI

                    CONSOLIDATION, MERGER, SALE OR CONVEYANCE

Section 11.01 Company May Consolidate, Etc. On Certain Terms.................62
Section 11.02 Successor Corporation Substituted..............................63
Section 11.03 Opinion of Counsel to Trustee..................................63

                                   ARTICLE XII

                    SATISFACTION AND DISCHARGE OF INDENTURE,
                                UNCLAIMED MONEYS

Section 12.01 Satisfaction and Discharge of Indenture........................63
Section 12.02 Application By Trustee of Funds Deposited for  Payment
              of Securities..................................................64
Section 12.03 Repayment of Moneys Held By Paying Agent.......................64
Section 12.04 Repayment of Moneys Held By Trustee............................64

                                  ARTICLE XIII

               IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS,
                             DIRECTORS AND EMPLOYEES

Section 13.01 Incorporators, Stockholders, Officers, Directors and
              Employees of Company Exempt From Individual Liability..........65

                                   ARTICLE XIV

                           SUBORDINATION OF SECURITIES

Section 14.01 Agreement to Subordinate.......................................65
Section 14.02 Obligation of The Company Unconditional........................67
Section 14.03 Limitations On Duties to Holders of Senior Indebtedness of
              The Company....................................................67

                                       v
<PAGE>

Section 14.04 Notice to Trustee of Facts Prohibiting Payment.................68
Section 14.05 Application By Trustee of Moneys Deposited With It.............68
Section 14.06 Subrogation....................................................68
Section 14.07 Subordination Rights Not Impaired By Acts or Omissions of
              Company or Holders of Senior Indebtedness of The Company.......69
Section 14.08 Authorization of Trustee to Effectuate Subordination of
              Securities.....................................................69
Section 14.09 No Payment When Senior Indebtedness In Default.................69
Section 14.10 Right of Trustee to Hold Senior Indebtedness of The Company....70
Section 14.11 Article XIV Not to Prevent Defaults............................70

                                   ARTICLE XV

                    LEGAL DEFEASANCE AND COVENANT DEFEASANCE

Section 15.01 Option to Effect Legal Defeasance or Covenant Defeasance.......70
Section 15.02 Legal Defeasance and Discharge.................................70
Section 15.03 Covenant Defeasance............................................71
Section 15.04 Conditions to Legal or Covenant Defeasance.....................71
Section 15.05 Deposited Money and Government Securities to be Held in
              Trust; Other Miscellaneous Provisions..........................72
Section 15.06 Repayment to Company...........................................73
Section 15.07 Reinstatement..................................................73

                                   ARTICLE XVI

                            MISCELLANEOUS PROVISIONS

Section 16.01 Successors and Assigns of Company Bound By Indenture...........73
Section 16.02 Acts of Board, Committee or Officer of Successor Corporation
              Valid..........................................................73
Section 16.03 Required Notices or Demands May Be Served By Mail..............74
Section 16.04 Officers' Certificate and Opinion of Counsel to Be Furnished
              Upon Applications or Demands By The Company....................74
Section 16.05 Payments Due On Saturdays, Sundays, and Holidays...............75
Section 16.06 Provisions Required By Trust Indenture Act of 1939 to Control..75
Section 16.07 Indenture and Securities to Be Construed In Accordance With
              The Laws of The State of New York..............................75
Section 16.08 Provisions of The Indenture and Securities for  The Sole
              Benefit of The Parties and The Securityholders.................75
Section 16.09 Indenture May Be Executed In Counterparts......................75
Section 16.10 Securities In Foreign Currencies...............................76

                                       vi
<PAGE>

     THIS INDENTURE, dated as of the 31st day of August, 2001 between DPL INC.,
a corporation duly organized and existing under the laws of the State of Ohio
(hereinafter sometimes referred to as the "COMPANY"), party of the first part,
and THE BANK OF NEW YORK, a New York banking corporation (hereinafter sometimes
referred to as the "TRUSTEE"), party of the second part.

                                   WITNESSETH:

     WHEREAS, for its lawful corporate purposes, the Company has duly authorized
the issuance from time to time of its unsecured junior subordinated debentures
or other evidences of indebtedness (hereinafter referred to as the
"SECURITIES"), without limit as to principal amount, issuable in one or more
series, the amount and terms of each such series to be determined as hereinafter
provided, including, without limitation, Securities issued to evidence loans
made to the Company of the proceeds from the issuance from time to time by one
or more business trusts (each a "DPL TRUST," and collectively, the "DPL TRUSTS")
of preferred interests in such Trusts (the "PREFERRED SECURITIES" which may also
be referred to, without limitation, as the "CAPITAL SECURITIES") and common
interests in such Trusts (the "COMMON SECURITIES," and collectively with the
Preferred Securities, the "TRUST SECURITIES"); to be authenticated by the
certificate of the Trustee; and, to provide the terms and conditions upon which
the Securities are to be authenticated, issued and delivered, the Company has
duly authorized the execution of this Indenture; and

     WHEREAS, all acts and things necessary to make the Securities when executed
by the Company and authenticated and delivered by the Trustee as in this
Indenture provided, the valid, binding and legal obligations of the Company, and
to constitute these presents a valid indenture and agreement according to its
terms, have been done and performed and the execution of this Indenture and the
issue hereunder of the Securities have in all respects been duly authorized, and
the Company, in the exercise of the legal rights and power vested in it,
executes this Indenture and proposes to make, execute, issue and deliver the
Securities;

     NOW, THEREFORE, in order to declare the terms and conditions upon which the
Securities are authenticated, issued and delivered, and in consideration of the
premises and of the purchase and acceptance of the Securities by the holders
thereof, the Company covenants and agrees with the Trustee, for the equal and
proportionate benefit of the respective holders from time to time of the
Securities or of series thereof, as follows:

                                    ARTICLE I

                                   DEFINITIONS
                                   -----------

     Section 1.01 Certain Terms Defined. For all purposes of this Indenture,
                  ---------------------
except as otherwise expressly provided or unless the context otherwise requires:

          (a) The terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;

<PAGE>

          (b) All other terms used herein which are defined in the Trust
Indenture Act of 1939, whether directly or by reference therein, have the
meanings assigned to them therein;

          (c) All accounting terms used herein and not expressly defined herein
shall have the meanings assigned to them in accordance with generally accepted
accounting principles in the United States of America, and, except as otherwise
herein expressly provided, the term "generally accepted accounting principles"
with respect to any computation required or permitted hereunder shall mean such
accounting principles as are generally accepted in the United States of America
at the date of such computation; provided, that when two or more principles are
so generally accepted, it shall mean that set of principles consistent with
those in use by the Company; and

          (d) The terms "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.

Act:

     The term "ACT" has the meaning specified in SECTION 2.01.

Additional Interest:

     The term "ADDITIONAL INTEREST" means the interest, if any, that shall
accrue on any interest on the Securities of any series the payment of which has
not been made on the applicable interest payment date and which shall accrue at
the rate per annum specified or determined as specified in such Security.

Additional Tax Sums:

     The term "ADDITIONAL TAX SUMS" has the meaning specified in SECTION 4.08.

Administrative Trustee:

     The term "ADMINISTRATIVE TRUSTEE" means, in respect of any DPL Trust, each
Person identified as an "ADMINISTRATIVE TRUSTEE" in the related Trust Agreement,
solely in such Person's capacity as Administrative Trustee of such DPL Trust
under such Trust Agreement and not in such Person's individual capacity, or any
successor administrative trustee appointed as therein provided.

applicants:

     The term "APPLICANTS" has the meaning specified in SECTION 5.02(B).

Authenticating Agent:

     The term "AUTHENTICATING AGENT" means any Authenticating Agent appointed by
the Trustee pursuant to SECTION 2.09.

                                       2
<PAGE>

Authorized Newspaper:

     The term "AUTHORIZED NEWSPAPER" means a newspaper in the City of Dayton,
State of Ohio, and the Borough of Manhattan, The City of New York, State of New
York, each of which is printed in the English language and customarily published
at least once a day for at least five days in each calendar week and of general
circulation in the respective cities. Whenever successive publications are
required to be made in an Authorized Newspaper, the successive publications may
be made in the same or in a different newspaper meeting the foregoing
requirements and in each case on any day of the week. If it is impossible or, in
the opinion of the Trustee, impracticable to publish any notice in the manner
herein provided, then such publication in lieu thereof as shall be made with the
approval of the Trustee shall constitute a sufficient publication of such
notice.

Board of Directors:

     The term "BOARD OF DIRECTORS," when used with reference to the Company,
means the Board of Directors of the Company or the Executive Committee or any
other committee of or created by the Board of Directors of the Company duly
authorized to act hereunder.

Business Day:

     The term "BUSINESS DAY" means any day which is not a Saturday or Sunday and
which is neither a legal holiday nor a day on which banking institutions in The
City of New York are authorized or required by law or executive order to close
or a day on which the principal corporate trust office of the Trustee is closed
for business.

Capital Securities:

     The term "CAPITAL SECURITIES" has the meaning specified in the recitals to
this Indenture.

Capital Stock:

     The term "CAPITAL STOCK" means shares of capital stock of any class of any
corporation whether now or hereafter authorized regardless of whether such
capital stock shall be limited to a fixed sum or percentage in respect of the
rights of the holders thereof to participate in dividends and in the
distribution of assets upon any voluntary or involuntary liquidation,
dissolution or winding up.

Commission:

     The term "COMMISSION" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the execution of this instrument such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act of 1939, then the body performing such duties on such
date.

                                       3
<PAGE>

Common Securities:

     The term "COMMON SECURITIES" has the meaning specified in the recitals to
this Indenture.

Common Stock:

     The term "COMMON STOCK" means the common stock, par value $.01 per share,
of the Company.

Company:

     The term "COMPANY" means DPL Inc., a corporation duly organized and
existing under the laws of the State of Ohio and, subject to the provisions of
Article XI, shall also include its successors and assigns.

Depositary:

     The term "DEPOSITARY" means, with respect to the Securities of any series
issuable or issued in whole or in part in the form of one or more global
Securities, the person designated as Depositary by the Company pursuant to
SECTION 2.01 until a successor Depositary shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter the term "DEPOSITARY"
shall mean or include each person who is then a Depositary hereunder and if at
any time there is more than one such person, the term "DEPOSITARY" as used with
respect to the Securities of any series shall mean the Depositary with respect
to the Securities of such series.

Distributions:

     The term "DISTRIBUTIONS," with respect to the Trust Securities issued by a
DPL Trust, means amounts payable in respect of such Trust Securities as provided
in the related Trust Agreement and referred to therein as "DISTRIBUTIONS."

DPL Guarantee:

     The term "DPL GUARANTEE" means the guarantee by the Company of
distributions on the Preferred Securities or the Capital Securities of a DPL
Trust to the extent provided in the Guarantee Agreement.

DPL Trust:

     The terms "DPL TRUST" and "DPL TRUSTS" each have the meaning specified in
the recitals to this Indenture.

Event of Default:

     The term "EVENT OF DEFAULT" with respect to Securities of any series shall
mean any event specified as such in SECTION 6.01 and any other event as may be
established with respect to the Securities of such series as contemplated by
SECTION 2.01.

                                       4
<PAGE>

Exchange Act:

     The term "EXCHANGE ACT" has the meaning specified in SECTION 2.02.

Extension Period:

     The term "EXTENSION PERIOD" has the meaning specified in SECTION 2.10.

Government Securities:

     The term "GOVERNMENT SECURITIES" means direct obligations of, or
obligations guaranteed by, the United States of America, and the payment for
which the United States pledges its full faith and credit.

Guarantee Agreement:

     The term "GUARANTEE AGREEMENT" means any Guarantee Agreement relating to
any Preferred Securities or Capital Securities of any DPL Trust, whether now
existing or created in the future.

Indenture:

     The term "INDENTURE" means this instrument as originally executed, or, if
amended or supplemented as herein provided, then as so amended or supplemented,
and shall include the form and terms of particular series of Securities
established as contemplated by SECTIONS 2.01 and 2.02.

Investment Company Event:

     The term "INVESTMENT COMPANY EVENT" means, in respect of a DPL Trust, the
receipt by a DPL Trust of an Opinion of Counsel to the effect that, as a result
of the occurrence of a change in law or regulation or a written change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority (a "CHANGE IN 1940 ACT LAW"),
such DPL Trust is or will be considered an investment company that is required
to be registered under the 1940 Act, which Change in 1940 Act Law becomes
effective on or after the date of original issuance of the Preferred Securities
of such DPL Trust.

Maturity:

     The term "MATURITY" when used with respect to any Security means the date
on which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.

1940 Act:

     The term "1940 ACT" means the Investment Company Act of 1940, as amended.

                                       5
<PAGE>

Officers' Certificate:

     The term "OFFICERS' CERTIFICATE" shall mean a certificate signed by the
Chairman of the Board, any Vice Chairman of the Board, the Chief Executive
Officer, the President, any Vice Chairman or any Vice President of the Company
(whether or not designated by a number or a word or words added before or after
the title Vice President) and by the Treasurer, an Assistant Treasurer, the
Controller, the Secretary or an Assistant Secretary of the Company and delivered
to the Trustee. Each such certificate shall include the statements provided for
in SECTION 16.04, if and to the extent required by the provisions thereof and
will comply with Section 314 of the Trust Indenture Act of 1939.

Opinion of Counsel:

     The term "OPINION OF COUNSEL" shall mean an opinion in writing signed by
legal counsel, who shall be satisfactory to the Trustee, and who may be an
employee of, or counsel to, the Company and delivered to the Trustee; provided
however, that for purposes of the definitions of "Tax Event" and "Investment
Company Event" contained herein, SECTION 2.12, SECTION 10.01(A), SECTION 11.01
and SECTION 15.04(B) and (C), such opinion shall be by nationally recognized
independent legal counsel experienced in the matters related to the substance of
the opinion. Each such opinion shall include the statements provided for in
SECTION 16.04, if and to the extent required by the provisions thereof, and will
comply with Section 314 of the Trust Indenture Act of 1939.

Original Issue Date:

     The term "ORIGINAL ISSUE DATE" means the first date of issuance of each
Security.

Original Issue Discount Security:

     The term "ORIGINAL ISSUE DISCOUNT SECURITY" shall mean any Security that
provides for an amount less than the principal amount thereof to be due and
payable upon declaration pursuant to SECTION 6.01.

Paying Agent:

     The term "PAYING AGENT" means the Trustee or any Person or Persons
authorized by the Company to pay the principal or interest on any Securities on
behalf of the Company.

Person:

     The term "PERSON" or "PERSON" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association or government or any agency or
political subdivision thereof, or any other entity of whatever nature.

                                       6
<PAGE>

Preferred Securities:

     The term "PREFERRED SECURITIES" has the meaning specified in the recitals
to this Indenture.

principal:

     The term "PRINCIPAL," whenever used with reference to the Securities or any
Security or any portion thereof, shall be deemed to include "and premium, if
any."

Property Trustee:

     The term "PROPERTY TRUSTEE" means, in respect of any DPL Trust, the
commercial bank or trust company identified as the "Property Trustee" in the
related Trust Agreement, solely in its capacity as Property Trustee of such DPL
Trust under such Trust Agreement and not in its individual capacity, or its
successor in interest in such capacity, or any successor property trustee
appointed as therein provided.

Ranking junior to the Securities:

     The term "RANKING JUNIOR TO THE SECURITIES," or correlative phrases, when
used with respect to any obligation of the Company means (i) any DPL Guarantee,
and (ii) any other obligation of the Company which (a) ranks junior to and not
equally with or prior to the Securities (or any other obligations of the Company
ranking on a parity with the Securities) in right of payment upon the happening
of any event of the kind specified in the first sentence of the first paragraph
of SECTION 14.01, or (b) is specifically designated as ranking junior to the
Securities by express provision in the instrument creating or evidencing such
obligation.

     The securing of any obligations of the Company, otherwise ranking junior to
the Securities, shall be deemed to prevent such obligations from constituting
obligations ranking junior to the Securities.

Ranking on a parity with the Securities:

     The term "RANKING ON A PARITY WITH THE SECURITIES," or correlative phrases,
when used with respect to any obligation of the Company means any obligation of
the Company which (a) ranks equally with and not prior to the Securities in
right of payment upon the happening of any event of the kind specified in the
first sentence of the first paragraph of SECTION 14.01, or (b) is specifically
designated as ranking on a parity with the Securities by express provision in
the instrument creating or evidencing such obligation.

     The securing of any obligations of the Company, otherwise ranking on a
parity with the Securities, shall not be deemed to prevent such obligations from
constituting obligations ranking on a parity with the Securities.

record date:

     The term "RECORD DATE" has the meaning specified in SECTION 2.03.

                                       7
<PAGE>

Register:

     The term "REGISTER" has the meaning specified in SECTION 2.05.

Resolution of the Company:

     The term "RESOLUTION OF THE COMPANY" means a resolution of the Company, in
the form of a resolution of the Board of Directors, in the form of a resolution
of a duly constituted committee of the Board of Directors, or in the form of a
resolution of two or more senior officers of the Company, authorizing,
ratifying, setting forth or otherwise validating agreements, execution and
delivery of documents, the issuance, form and terms of Securities, or any other
actions or proceedings pursuant or with respect to this Indenture.

Responsible Officer:

     The term "RESPONSIBLE OFFICER," when used with respect to the Trustee,
means any officer of the Trustee with direct responsibility for the
administration of this Indenture and also means, with respect to a particular
corporate trust matter, any other officer of the Trustee to whom such matter is
referred by the Trustee because of his knowledge of, and familiarity with, a
particular subject.

Rights Plan:

     The term "RIGHTS PLAN" means a plan of the Company providing for the
issuance by the Company to all holders of its Common Stock of rights entitling
the holders thereof to subscribe for or purchase shares of Common Stock or any
class or series of preferred stock, which rights (i) are deemed to be
transferred with such shares of Common Stock, (ii) are not exercisable and (iii)
are also issued in respect of future issuances of Common Stock, in each case
until the occurrence of a specified event or events.

Security or Securities; outstanding:

     The term "SECURITY" or "SECURITIES" means any security or securities of the
Company, as the case may be, without regard to series, authenticated and
delivered under this Indenture.

     The term "OUTSTANDING," when used with reference to Securities and subject
to the provisions of SECTION 8.04, means as of any particular time, all
Securities authenticated and delivered by the Trustee under this Indenture,
except

          (a) Securities theretofore cancelled by the Trustee or delivered to
     the Trustee for cancellation;

          (b) Securities, or portions thereof, for the payment or redemption of
     which moneys in the necessary amount shall have been deposited in trust
     with the Trustee or with any Paying Agent (other than the Company) or shall
     have been set aside and segregated in trust by the Company (if the Company
     shall act as its own Paying Agent); provided that such Securities shall
     have reached their Stated Maturity or, if such Securities are to be
     redeemed prior to the Stated Maturity thereof, notice of such redemption

                                       8
<PAGE>

     shall have been given as in Article III provided, or provision satisfactory
     to the Trustee shall have been made for giving such notice; and

          (c) Securities in lieu of or in substitution for which other
     Securities shall have been authenticated and delivered or which have been
     paid pursuant to the terms of SECTION 2.07 unless proof satisfactory to the
     Trustee is presented that any such Securities are held by persons in whose
     hands any of such Securities is a valid, binding and legal obligation of
     the Company.

     In determining whether the holders of the requisite principal amount of
outstanding Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, the principal amount of an Original Issue
Discount Security that shall be deemed to be outstanding for such purposes shall
be the amount of the principal thereof that would be due and payable as of the
date of such determination upon a declaration of acceleration of the Maturity
thereof pursuant to SECTION 6.01.

Securityholder; registered holder:

     The terms "SECURITYHOLDER," "HOLDER OF SECURITIES," "REGISTERED HOLDER" or
other similar term, mean any person who shall at the time be the registered
holder of any Security or Securities on the Register kept for that purpose in
accordance with the provisions of this Indenture.

Senior Indebtedness of the Company:

     The term "SENIOR INDEBTEDNESS OF THE COMPANY" means the principal of, and
premium, if any, and interest, if any (including interest accruing on or after
the filing of any petition in bankruptcy or for reorganization of the Company,
and including any rate of interest applicable upon default, whether or not such
claim for post-petition interest is allowed in such proceeding) on (i) any
indebtedness of the Company for borrowed money, whether or not evidenced by
bonds, debentures, notes or other written instruments, (ii) obligations under
letters of credit, (iii) any indebtedness or other obligations of the Company
with respect to commodity contracts, interest rate and currency swap agreements,
cap, floor and collar agreements, currency spot and forward contracts, and other
similar agreements or arrangements designed to protect against fluctuations in
currency exchange or interest rates, and (iv) any guarantees, endorsements
(other than by endorsement of negotiable instruments for collection in the
ordinary course of business) or other similar contingent obligations in respect
of obligations of others of a type described in (i), (ii) or (iii) above whether
or not such obligation is classified as a liability on a balance sheet prepared
in accordance with generally accepted accounting principles, in each case listed
in (i), (ii), (iii) and (iv) above whether outstanding on the date of execution
of this Indenture or thereafter incurred, other than obligations ranking on a
parity with the Securities or ranking junior to the Securities; provided,
however, that "Senior Indebtedness of the Company" does not include trade
creditors.

Stated Maturity:

     The term "STATED MATURITY" when used with respect to any Security or any
installment of principal thereof or interest thereon means the date specified
pursuant to the terms of such Security as the date on which the principal of

                                       9
<PAGE>

such Security or such installment of interest is due and payable in the case of
such principal, as such date may be shortened or extended or provided pursuant
to the terms of such Security and this Indenture.

Subsidiary:

     The term "SUBSIDIARY" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock
which ordinarily has voting power for the election of directors, whether at all
times or only so long as no senior class of stock has such voting power by
reason of any contingency.

Tax Event:

     The term "TAX EVENT" means the receipt by the Company and a DPL Trust of an
Opinion of Counsel experienced in such matters to the effect that, as a result
of any amendment to, or change (including any announced prospective change) in,
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative written pronouncement, action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which proposed change, pronouncement, action or decision is
announced on or after the date of issuance of the Preferred Securities of such
DPL Trust, there is more than an insubstantial risk that (i) the DPL Trust is,
or will be within 90 days after the date of such Opinion of Counsel, subject to
United States federal income tax with respect to income received or accrued on
the corresponding series of Securities issued by the Company to such DPL Trust,
(ii) interest payable by the Company on such corresponding series of Securities
is not, or within 90 days of the date of such Opinion of Counsel, will not be,
deductible by the Company, in whole or in part, for United States federal income
tax purposes, or (iii) the DPL Trust is, or will be within 90 days after the
date of such Opinion of Counsel, subject to more than a de minimis amount of
other taxes, duties or other governmental charges.

Trust Agreement:

     The term "TRUST AGREEMENT" means any Trust Agreement governing any DPL
Trust, whether now existing or created in the future, relating to the Securities
of any series in each case.

Trustee; Principal Office of the Trustee:

     The term "TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this instrument, and, subject to the provisions of Article VII,
shall also include its successors. The term "PRINCIPAL OFFICE" of the Trustee
shall mean the corporate trust office of the Trustee in The City of New York,
State of New York, at which the corporate trust business of the Trustee shall,
at any particular time, be principally administered. The present address of the
corporate trust office of the Trustee in The City of New York, State of New York
office at which the corporate trust business of the Trustee is principally
administered is 101 Barclay Street, Floor 21 West, New York, New York 10286,
Attention: Corporate Trust Administration.

                                       10
<PAGE>

Trust Indenture Act of 1939:

     Except as herein otherwise expressly provided or unless the context
requires otherwise, the term "TRUST INDENTURE ACT OF 1939" shall mean the Trust
Indenture Act of 1939, as amended by the Trust Indenture Reform Act of 1990, as
in force at the date as of which this Indenture was originally executed.

Trust Securities:

     The term "TRUST SECURITIES" has the meaning specified in the recitals to
this Indenture.

                                   ARTICLE II

             ISSUE, DESCRIPTION, EXECUTION, REGISTRATION OF TRANSFER
             -------------------------------------------------------
                           AND EXCHANGE OF SECURITIES
                           --------------------------

     Section 2.01 Amount, Series and Delivery of Securities. The aggregate
                  -----------------------------------------
principal amount of Securities which may be authenticated and delivered under
this Indenture is unlimited.

     The Securities may be issued in one or more series. The terms of each
series (which terms shall not be inconsistent with the provisions of this
Indenture) including:

          (1) The designation of the Securities of such series (which shall
     distinguish the Securities of the series from all other Securities and
     which shall include the word "subordinated" or a word of like meaning);

          (2) Any limit upon the aggregate principal amount of the Securities of
     such series which may be executed, authenticated and delivered under this
     Indenture; provided, however, that nothing contained in this Section or
     elsewhere in this Indenture or in such Securities or in a Resolution of the
     Company or Officers' Certificate or supplemental indenture is intended to
     or shall limit execution by the Company or authentication and delivery by
     the Trustee of Securities under the circumstances contemplated by SECTIONS
     2.05, 2.06, 2.07, 3.02, 3.03 and 10.04;

          (3) The date or dates (if any) on which the principal of the
     Securities of such series is payable;

          (4) The rate or rates at which the Securities of such series shall
     bear interest, if any, the rate or rates and extent to which Additional
     Interest or other interest, if any, shall be payable, the date or dates
     from which such interest shall accrue, the dates on which such interest
     shall be payable, the record date for the interest payable on any interest
     payment date and the right of the Company to defer or extend an interest
     payment date;

          (5) The place or places where Securities of such series may be
     presented for payment and for the other purposes provided in SECTION 4.02;

                                       11
<PAGE>

          (6) Any price or prices at which, any period or periods within which,
     and any terms and conditions upon which Securities of such series may be
     redeemed, in whole or in part, at the option of the Company;

          (7) The type or types (if any) of Capital Stock of the Company into
     which, any period or periods within which, and any terms and conditions
     upon which Securities of such series may be made payable, converted,
     exchanged in whole or in part, at the option of the holder or of the
     Company;

          (8) If other than denominations of $1,000 and any whole multiple
     thereof, the denominations in which Securities of such series shall be
     issuable;

          (9) If other than the principal amount thereof, the portion of the
     principal amount of Securities of such series which shall be payable upon
     declaration of acceleration of the Maturity thereof pursuant to SECTION
     6.01;

          (10) If other than such coin or currency of the United States of
     America as at the time of payment is legal tender for payment of public or
     private debts, the coin or currency (which may be a composite currency) in
     which payment of the principal of (and premium, if any) and interest, if
     any, on the Securities of such series shall be payable;

          (11) If the principal of (and premium, if any) or interest, if any, on
     the Securities of such series are to be payable, at the election of the
     Company or a holder thereof, in a coin or currency (including composite
     currency) other than that in which the Securities of such series are stated
     to be payable, the period or periods within which, and the terms and
     conditions upon which, such election may be made;

          (12) If the amounts of payments of principal of (and premium, if any)
     or interest, if any, on the Securities of such series may be determined
     with reference to an index based on a coin or currency (including composite
     currency) other than that in which the Securities of such series are stated
     to be payable, the manner in which such amounts shall be determined;

          (13) If the Securities of such series are payable at Maturity or upon
     earlier redemption in Capital Stock, the terms and conditions upon which
     such payment shall be made;

          (14) The person or persons who shall be registrar for the Securities
     of such series, and the place or places where the Register of Securities of
     the series shall be kept;

          (15) Any Events of Default with respect to the Securities of such
     series, if not set forth herein;

          (16) Whether any Securities of such series are to be issuable in
     global form with or without coupons, and, if so, the Depositary for such
     global Securities and whether beneficial owners of interests in any such
     global Security may exchange such interests for definitive Securities of
     such series and of like tenor of any authorized form and denomination and

                                       12
<PAGE>

     the circumstances under which, and the place or places where, any such
     exchanges may occur, if other than in the manner provided in SECTION 2.05;

          (17) The form of Trust Agreement and Guarantee Agreement, if
     applicable;

          (18) If applicable, the relative degree to which Securities of such
     series shall be senior to or be subordinated to other series of such
     Securities or other indebtedness of the Company in right of payment,
     whether such other series of Securities or other indebtedness are
     outstanding or not; and

          (19) Any other terms of the series (which terms shall not be
     inconsistent with the provisions of this Indenture);

or in any case, the method for determining such terms, the persons authorized to
determine such terms and the limits, if any, within which any such determination
of such terms is to be made shall either be established in or pursuant to a
Resolution of the Company and set forth in an Officers' Certificate, or set
forth in one or more indentures supplemental hereto, prior to the issuance of
Securities of any series.

     The Securities of all series shall be subordinate to Senior Indebtedness of
the Company as provided in Article XIV. The applicable Resolution of the Company
as set forth in an Officers' Certificate, or supplemental indenture, may provide
that Securities of any particular series may be issued at various times, with
different dates on which the principal or any installment of principal is
payable, with different rates of interest, if any, or different methods by which
interest may be determined, with different dates from which such interest shall
accrue, with different dates on which such interest may be payable or with any
different terms other than Events of Default but all such Securities of a
particular series shall for all purposes under this Indenture including, but not
limited to, voting and Events of Default, be treated as Securities of a single
series.

     If any of the terms of any series of Securities are established by action
taken pursuant to a Resolution of the Company, a copy of an appropriate record
of such action shall be certified by the Secretary or an Assistant Secretary of
the Company and delivered to the Trustee at or prior to the delivery of the
Officers' Certificate or supplemental indenture setting forth the terms of the
series.

     At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities of any series executed by the
Company to the Trustee for authentication by it, and the Trustee shall thereupon
authenticate and deliver such Securities to or upon the written order of the
Company, signed by its Chairman of the Board, or its Chief Executive Officer, or
its President, or any Vice Chairman or any Vice President of the Company
(whether or not designated by a number or a word or words added before or after
the title Vice President), and by its Treasurer or an Assistant Treasurer or its
Controller or its Secretary or an Assistant Secretary, without any further
corporate action by the Company. If the form or terms of the Securities of the
series have been established in or pursuant to a Resolution of the Company and
set forth in an Officers' Certificate, or set forth in one or more supplemental
indentures hereto, as permitted by this Section and SECTION 2.02, in

                                       13
<PAGE>

authenticating such Securities, and accepting the additional responsibilities
under this Indenture in relation to such Securities, the Trustee shall be
entitled to receive, and (subject to SECTION 7.01) shall be fully protected in
relying upon:

          (a) an Opinion of Counsel stating:

               (i) that the form and terms of such Securities have been
     established in conformity with the provisions of this Indenture;

               (ii) That the issuance and sale of such Securities have been duly
     registered under the Securities Act of 1933, as amended (the "ACT"), and a
     registration statement with respect thereto under the Act has become
     effective under the Act, or that such issuance and sale are exempt from the
     registration requirements of the Act; and that any other action by or
     before any governmental body or authority (except that the offer and sale
     of such Securities in certain jurisdictions may be subject to the Blue Sky
     or securities laws of such jurisdictions) required in connection with the
     issuance and sale of such Securities has been duly taken, specifying the
     nature thereof, or that no such action is required;

               (iii) That the issuance and delivery of such Securities does not
     violate the charter or code of regulations of the Company or violate any
     order or decree of any court or public authority having jurisdiction of
     which such counsel has knowledge; or result in a breach of the terms,
     conditions or provisions of, or constitute a default under, any mortgage,
     indenture, contract, agreement or undertaking known to counsel to which the
     Company is a party or by which it is bound;

               (iv) That such Securities, when executed by the Company and
     authenticated by the Trustee in accordance with the terms of this Indenture
     and delivered to the purchasers thereof against payment of the agreed
     consideration therefor in accordance with the terms of any purchase or
     similar agreement, will be entitled to the benefits of this Indenture and
     will constitute valid and binding obligations of the Company, enforceable
     against the Company in accordance with their terms, except as may be
     limited by applicable bankruptcy, insolvency, fraudulent conveyance,
     reorganization or other similar laws affecting creditors' rights and by
     general equitable principles (whether considered in a proceeding in equity
     or at law);

               (v) If the terms of such Securities provide for the conversion of
     such Securities into shares of Capital Stock of the Company, or the payment
     thereof in Capital Stock upon Maturity or earlier redemption of such
     Securities, that the Company has reserved a sufficient number of shares of
     Capital Stock for issuance upon such conversion or payment, and such shares
     of Capital Stock, upon such issuance, will be duly and validly issued,
     fully paid and nonassessable;

               (vi) That the Company has the corporate power to issue such
     Securities, and has duly taken all necessary corporate action with respect
     to such issuance;

               (vii) That all laws and requirements in respect of the execution
     and delivery by the Company of such Securities and the related supplemental
     indenture, if any, have been complied with and that authentication and

                                       14
<PAGE>

     delivery of such Securities and the execution and delivery of the related
     supplemental indenture, if any, by the Trustee will not violate the terms
     of this Indenture; and

               (viii) Such other matters as the Trustee may reasonably request;
     and

          (b) An Officers' Certificate setting forth the form and terms of the
Securities of such series pursuant to this Section and SECTION 2.02 hereof (but
only if the form and terms of the Securities of such series are not set forth in
one or more supplemental indentures hereto) and stating that all conditions
precedent provided for in this Indenture relating to the issuance of such
Securities have been complied with, that no Event of Default with respect to any
series of Securities has occurred and is continuing and that the issuance of
such Securities is not and will not result in (i) an Event of Default or an
event or condition which, upon the giving of notice to, or the acquisition of
knowledge by, each such officer, or the lapse of time or both, would become an
Event of Default or (ii) a default under the provisions of any other instrument
or agreement by which the Company is bound.

     The Trustee shall not be required to authenticate such Securities if the
issue of such Securities pursuant to this Indenture will affect the Trustee's
own rights, duties or immunities under the Securities and this Indenture or
otherwise in a manner which is not reasonably acceptable to the Trustee.

     If all the Securities of any series are not to be issued at one time, it
shall not be necessary to deliver either an Opinion of Counsel or an Officers'
Certificate at the time of issuance of each Security; provided that such Opinion
of Counsel and Officers' Certificate, with appropriate modifications, are
instead delivered at or prior to the time of issuance of the first Security of
such series.

     Each Security shall be dated the date of its authentication.

     Section 2.02 Form of Securities and Trustee's Certificate. The Securities
                  --------------------------------------------
of each series shall be substantially of the tenor and terms as shall be
authorized in or pursuant to a Resolution of the Company and set forth in an
Officers' Certificate, or set forth in an indenture or indentures supplemental
hereto in each case with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, and may
have such letters, numbers or other marks of identification or designation and
such legends or endorsements thereon as the Company may deem appropriate and as
are not inconsistent with the provisions of this Indenture, or as may be
required to comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange or automated
quotation system on which the Securities may be listed, or to conform to usage.
If the form of Securities of any series is authorized by action taken pursuant
to a Resolution of the Company, a copy of an appropriate record of such action
shall be certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate contemplated by SECTION 2.01 setting forth the terms of the series.

     The Securities may be printed, lithographed or fully or partly engraved.

     The Trustee's certificate of authentication shall be in substantially the
following form:

                                       15
<PAGE>

     This is one of the Securities, of the series designated herein, referred to
in the within-mentioned Indenture.

                                        THE BANK OF NEW YORK, as Trustee

                                        By:  ______________________________
                                             Authorized Signatory

     If Securities of a series are issuable in global form, as specified
pursuant to SECTION 2.01, then, notwithstanding clause (8) of SECTION 2.01 and
the provisions of SECTION 2.03, such Security shall represent such of the
outstanding Securities of such series as shall be specified therein and may
provide that it shall represent the aggregate amount of outstanding Securities
of such series from time to time endorsed thereon and that the aggregate amount
of outstanding Securities of such series represented thereby may from time to
time be increased or reduced to reflect exchanges or transfers. Any endorsement
of a Security in global form to reflect the amount, or any increase or decrease
in the amount, of outstanding Securities represented thereby shall be made by
the Trustee in such manner and upon instructions given by such person or persons
as shall be specified in such Security or by the Company. Subject to the
provisions of SECTION 2.04 and, if applicable, SECTION 2.06, the Trustee shall
deliver and redeliver any Security in global form in the manner and upon written
instructions given by the person or persons specified in such Security or by the
Company. Any instructions by the Company with respect to endorsement or delivery
or redelivery of a Security in global form after the original issuance of the
Securities of such series shall be in writing but need not comply with SECTION
16.04 and need not be accompanied by an Opinion of Counsel.

     Unless otherwise specified pursuant to SECTION 2.01, payment of principal
of and any premium and any interest on any Security in global form shall be made
to the person or persons specified therein.

     The owners of beneficial interests in any global Security shall have no
rights under this Indenture with respect to any global Security held on their
behalf by a Depositary, and such Depositary may be treated by the Company, the
Trustee, and any agent of the Company or the Trustee as the sole holder and
owner of such global Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or any agent of
the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by a Depositary, or impair, as between a
Depositary and its participants in any global Security, the operation of
customary practices governing the exercise of the rights of a holder of a
Security of any series, including, without limitation, the granting of proxies
or other authorization of participants to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action that a holder
is entitled to give or take under this Indenture.

     Neither the Company, the Trustee nor any Authenticating Agent will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a global Security
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.

                                       16
<PAGE>

     Each Depositary designated pursuant to SECTION 2.01 for a global Security
must, at the time of its designation and at all times while it serves as
Depositary, be a clearing agency registered under the Securities Exchange Act of
1934, as amended (the "EXCHANGE ACT"), and any other applicable statute or
regulation.

     Section 2.03 Denominations of and Payment of Interest on Securities. The
                  ------------------------------------------------------
Securities of each series shall be issuable as fully registered Securities
without coupons in such denominations as shall be specified as contemplated by
SECTION 2.01 (except as provided in SECTION 2.02 and SECTION 2.06). In the
absence of any such provisions with respect to the Securities of any series, the
Securities of such series shall be issuable in denominations of $1,000 and
integral multiples of $1,000 in excess thereof.

     If the Securities of any series shall bear interest, each Security of such
series shall bear interest from the applicable date at the rate or rates per
annum, and such interest shall be payable on the dates, specified on, or
determined in the manner provided in, the Security. The person in whose name any
Security is registered at the close of business on any record date (as defined
below) for the Security with respect to any interest payment date for such
Security shall be entitled to receive the interest payable thereon on such
interest payment date notwithstanding the cancellation of such Security upon any
registration of transfer, exchange or conversion thereof subsequent to such
record date and prior to such interest payment date, unless such Security shall
have been called for redemption on a date fixed for redemption subsequent to
such record date and prior to such interest payment date or unless the Company
shall default in the payment of interest due on such interest payment date on
such Security, in which case such defaulted interest shall be paid to the person
in whose name such Security (or any Security or Securities issued upon
registration of or exchange thereof) is registered at the close of business on
the record date for the payment of such defaulted interest, or except as
otherwise specified as contemplated by SECTION 2.01. The term "record date" as
used in this Section with respect to any regular interest payment date for any
Security shall mean such day or days as shall be specified as contemplated by
SECTION 2.01; provided, however, that in the absence of any such provisions with
respect to any Security, such term shall mean: (1) if such interest payment date
is the first day of a calendar month, record date means the fifteenth day of the
calendar month next preceding such interest payment date; or (2) if such
interest payment date is the fifteenth day of a calendar month, record date
means the first day of such calendar month; provided, further, that (except as
otherwise specified as contemplated by SECTION 2.01) if the day which would be
the record date as provided herein is not a Business Day, then it shall mean the
Business Day next preceding such day. Such term, as used in this Section, with
respect to the payment of any defaulted interest on any Security shall mean
(except as otherwise specified as contemplated by SECTION 2.01) the fifth day
next preceding the date fixed by the Company for the payment of defaulted
interest, established by notice given by first class mail by or on behalf of the
Company to the holder of such Security not less than 10 days preceding such
record date, or, if such fifth day is not a Business Day, the Business Day next
preceding such fifth day.

     Section 2.04 Execution of Securities. The Securities shall be signed on
                  -----------------------
behalf of the Company, manually or in facsimile, by its Chairman of the Board,
or its Chief Executive Officer, or its President, or any Vice Chairman, or any
Vice President of the Company (whether or not designated by a number or a word
or words added before or after the title Vice President), and by its Treasurer
or an Assistant Treasurer or its Controller or its Secretary or an Assistant

                                       17
<PAGE>

Secretary under its corporate seal, which may be affixed thereto or printed,
engraved or otherwise reproduced thereon, by facsimile or otherwise. Only such
Securities as shall bear thereon a certificate of authentication substantially
in the form recited herein, executed by or on behalf of the Trustee manually by
an authorized signatory, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. Such certificate of authentication by
the Trustee upon any Security executed by the Company shall be conclusive
evidence that the Security so authenticated has been duly authenticated and
delivered hereunder and that the holder is entitled to the benefits of this
Indenture. Typographical or other errors or defects in the seal or facsimile
signature on any Security or in the text thereof shall not affect the validity
or enforceability of such Security if it has been duly authenticated and
delivered by the Trustee.

     In case any officer of the Company who shall have signed any of the
Securities, manually or in facsimile, shall cease to be such officer before the
Securities so signed shall have been authenticated and delivered by the Trustee,
or disposed of by the Company, such Securities nevertheless may be authenticated
and delivered or disposed of as though the person who signed such Securities had
not ceased to be such officer of the Company; and any Security may be signed on
behalf of the Company, manually or in facsimile, by such persons as, at the
actual date of the execution of such Security, shall be the proper officers of
the Company, although at the date of the execution of this Indenture any such
person was not such officer.

     Section 2.05 Registration, Transfer and Exchange of Securities. Securities
                  -------------------------------------------------
of any series (other than a global Security, except as set forth below) may be
exchanged for a like aggregate principal amount of Securities of the same series
of the same tenor and terms of other authorized denominations. Securities to be
exchanged shall be surrendered at the offices or agencies to be maintained by
the Company in accordance with the provisions of SECTION 4.02 and the Company
shall execute and the Trustee shall authenticate and deliver, or cause to be
authenticated and delivered, in exchange therefor the Security or Securities
which the Securityholder making the exchange shall be entitled to receive.

     The Company shall keep, at one or more of the offices or agencies to be
maintained by the Company in accordance with the provisions of SECTION 4.02 with
respect to the Securities of each series, a Register ( the "REGISTER") in which,
subject to such reasonable regulations as it may prescribe, the Company shall
register the Securities of such series and the transfer of Securities of such
series as in this Article provided. Such Register shall be in written form or in
any other form capable of being converted into written form within a reasonable
time. At all reasonable times the Register shall be open for inspection by the
Trustee and any registrar of the Securities of such series other than the
Trustee. Upon due presentment for registration or transfer of any Security of
any series at the offices or agencies of the Company to be maintained by the
Company in accordance with SECTION 4.02 with respect to the Securities of such
series, the Company shall execute and register and the Trustee shall
authenticate and deliver in the name of the transferee or transferees a new
Security or Securities of the same series of like tenor and terms for a like
aggregate principal amount of authorized denominations.

     Every Security issued upon registration of transfer or exchange of
Securities pursuant to this Section shall be the valid obligation of the
Company, evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Security or Securities surrendered upon registration of such
transfer or exchange.

                                       18
<PAGE>

     All Securities of any series presented or surrendered for exchange,
registration of transfer, redemption, conversion or payment shall, if so
required by the Company or any registrar of the Securities of such series, be
accompanied by a written instrument or instruments of transfer, in form
satisfactory to the Company and such registrar, duly executed by the registered
holder or by his attorney duly authorized in writing.

     No service charge shall be made for any exchange or registration of
transfer of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto.

     The Company shall not be required to exchange or register the transfer of
(a) any Securities of any series during a period beginning at the opening of
business fifteen days before the day of the mailing of a notice of redemption of
outstanding Securities of such series and ending at the close of business on the
relevant redemption date, or (b) any Securities or portions thereof called or
selected for redemption, except, in the case of Securities called for redemption
in part, the portion thereof not so called for redemption.

     Notwithstanding any other provision of this Section, unless and until it is
exchanged in whole or in part for Securities in definitive form, a global
Security representing all or a portion of the Securities of a series may not be
transferred, except as a whole by the Depositary for such series to a nominee of
such Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary or by such Depositary or any such nominee to a
successor Depositary for such series or a nominee of such successor Depositary.

     Notwithstanding the foregoing, except as otherwise specified pursuant to
SECTION 2.01, any global Security shall be exchangeable pursuant to this Section
only as provided in this paragraph. If at any time the Depositary for the
Securities of a series notifies the Company that it is unwilling or unable to
continue as Depositary for the Securities of such series, or if at any time the
Depositary for the Securities of such series shall no longer be eligible to so
act, the Company shall appoint a successor Depositary with respect to the
Securities of such series. If (a) a successor Depositary for the Securities of
such series is not appointed by the Company within 90 days after the Company
receives such notice or becomes aware of such ineligibility (thereby
automatically making the Company's election pursuant to SECTION 2.01 no longer
effective with respect to the Securities of such series), (b) the beneficial
owners of interests in a global Security are entitled to exchange such interests
for definitive Securities of such series and of the same tenor and terms, as
specified pursuant to SECTION 2.01, or (c) the Company in its sole discretion
determines that the Securities of any series issued in the form of one or more
global Securities shall no longer be represented by such global Security or
Securities, then without unnecessary delay, but, if appropriate, in any event
not later than the earliest date on which such interest may be so exchanged, the
Company shall deliver to the Trustee definitive Securities in aggregate
principal amount equal to the principal amount of such global Security, executed
by the Company and authenticated by the Trustee. On or after the earliest date
on which such interests are or may be so exchanged, such global Security shall
be surrendered by the Depositary to the Trustee, as the Company's agent for such
purpose, to be exchanged, in whole or from time to time in part, for definitive
Securities upon payment by the beneficial owners of such interest, at the option
of the Company, of a service charge for such exchange and of a proportionate
share of the cost of printing such definitive Securities, and the Trustee shall

                                       19
<PAGE>

authenticate and deliver, (a) to each person specified by the Depositary in
exchange for each portion of such global Security, an equal aggregate principal
amount of definitive Securities of the same series of authorized denominations
and of the same tenor and terms as the portion of such global Security to be
exchanged, and (b) to such Depositary a global Security in a denomination equal
to the difference, if any, between the principal amount of the surrendered
global security and the aggregate principal amount of definitive Securities
delivered to holders thereof; provided, however, that no such exchanges may
occur during a period beginning at the opening of business 15 days before any
selection of Securities of that series to be redeemed and ending on the relevant
redemption date. If a Security is issued in exchange for any portion of a global
Security after the close of business at the office or agency where such exchange
occurs on (i) any record date and before the opening of business at such office
or agency on the relevant interest payment date, or (ii) any record date for the
payment of defaulted interest and before the opening of business at such office
or agency on the related proposed date for payment of defaulted interest, then
interest or default interest, as the case may be, will not be payable on such
interest payment date or proposed date for payment of defaulted interest, as the
case may be, in respect of such Security, but will be payable on such interest
payment date or proposed date for payment of defaulted interest, as the case may
be, only to the person to whom interest in respect of such portion of such
global Security is payable in accordance with the provisions of this Indenture
and such global Security.

     Section 2.06 Temporary Securities. Pending the preparation of definitive
                  --------------------
Securities of any series, the Company may execute and the Trustee shall, upon
the written order of the Company, authenticate and deliver temporary Securities
of such series (printed or lithographed) of any denomination and substantially
in the form of the definitive Securities of such series, but with or without a
recital of specific redemption prices or conversion provisions and with such
omissions, insertions and variations as may be appropriate for temporary
Securities, all as may be determined by the Company. Temporary Securities may
contain such reference to any provisions of this Indenture as may be
appropriate. Every such temporary Security shall be authenticated by the Trustee
upon the same conditions and in substantially the same manner, and with the same
effect, as the definitive Securities. Without unreasonable delay the Company
will execute and deliver to the Trustee definitive Securities of such series and
thereupon any or all temporary Securities of such series may be surrendered in
exchange therefor, at the offices or agencies to be maintained by the Company as
provided in SECTION 4.02 with respect to the Securities of such series, and the
Trustee shall, upon the written order of the Company, authenticate and deliver
in exchange for such temporary Securities an equal aggregate principal amount of
definitive Securities of such series. Until so exchanged, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of such series authenticated and
delivered hereunder.

     Section 2.07 Mutilated, Destroyed, Lost or Stolen Securities. In case any
                  -----------------------------------------------
temporary or definitive Security shall become mutilated or be destroyed, lost or
stolen, the Company, in the case of any mutilated Security shall, and in the
case of any destroyed, lost or stolen Security in its discretion may, execute,
and upon its request the Trustee shall authenticate and deliver, or cause to be
authenticated and delivered, a new Security of the same series of like tenor and
terms in exchange and substitution for the mutilated Security, or in lieu of and
in substitution for the Security so destroyed, lost or stolen. In case any such
Security shall have matured or shall be about to mature, instead of issuing a
substituted Security, the Company may pay or authorize payment of the same

                                       20
<PAGE>

(without surrender thereof, except in the case of a mutilated Security). In
every case the applicant for a substituted Security or for such payment shall
furnish to the Company and the Trustee such security or indemnity as may be
required by them to save each of them harmless, and, in every case of
destruction, loss or theft, the applicant shall also furnish to the Company and
to the Trustee evidence to their satisfaction of the destruction, loss or theft
of such Security and of the ownership thereof. The Trustee may authenticate any
such substituted Security and deliver the same, or the Trustee or any Paying
Agent of the Company may make any such payment, upon the written request or
authorization of any officer of the Company. Upon the issue of any substituted
Security, the Company may require the payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and any
other reasonable expenses connected therewith (including the fees and expenses
of the Trustee).

     To the extent permitted by mandatory provisions of law, every substituted
Security issued pursuant to the provisions of this Section in substitution for
any destroyed, lost or stolen Security shall constitute an additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be found at any time, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Securities of the same series duly issued hereunder.

     To the full extent legally enforceable, all Securities shall be held and
owned upon the express condition that the foregoing provisions are exclusive
with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Securities and shall preclude any and all other rights or remedies
notwithstanding any law or statute now existing or hereafter enacted to the
contrary with respect to the replacement or payment of negotiable instruments or
other securities without their surrender.

     Section 2.08 Cancellation and Destruction of Surrendered Securities. All
                  ------------------------------------------------------
Securities surrendered for the purpose of payment, redemption, exchange,
substitution or registration of transfer, shall, if surrendered to the Company
or any agent of the Company or of the Trustee, be delivered to the Trustee, and
the same, together with Securities surrendered to the Trustee for cancellation,
shall be cancelled by it, and no Securities shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Indenture. All
canceled Securities held by the Trustee shall be disposed of in conformance with
the Trustee's then customary procedures, unless otherwise directed by a written
order of the Company; provided however, that the Trustee shall not be required
to destroy any Securities. If the Company shall purchase or otherwise acquire
any of the Securities, however, such purchase or acquisition shall not operate
as a payment, redemption or satisfaction of the indebtedness represented by such
Securities unless and until the Company, at its option, shall deliver or
surrender the same to the Trustee for cancellation.

     Section 2.09 Authenticating Agents. The Trustee may from time to time
                  ---------------------
appoint one or more Authenticating Agents with respect to one or more series of
Securities, which shall be authorized to act on behalf of the Trustee and
subject to its direction in authenticating and delivering Securities of such
series pursuant hereto as fully to all intents and purposes as though any such
Authenticating Agent had been expressly authorized to authenticate and deliver
Securities of such series, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all

                                       21
<PAGE>

purposes as though authenticated by the Trustee. Wherever reference is made in
this Indenture to the authentication or delivery of Securities by the Trustee or
the Trustee's certificate of authentication, such reference shall be deemed to
include authentication or delivery on behalf of the Trustee by an Authenticating
Agent and a certificate of authentication executed on behalf of the Trustee by
an Authenticating Agent. Each Authenticating Agent shall at all times be a
corporation (including a banking association) organized and doing business under
the laws of the United States or any State or territory thereof or of the
District of Columbia, having a combined capital and surplus of at least five
million dollars ($5,000,000) authorized under such laws to exercise corporate
trust powers and subject to supervision or examination by federal, state,
territorial, or District of Columbia authorities. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of the aforesaid supervising or examining authority, then for the purposes of
this Section, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time an Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect herein specified in this
Section.

     Any corporation succeeding to the corporate agency business of an
Authenticating Agent shall continue to be an Authenticating Agent, if such
successor corporation is otherwise eligible under this Section, without the
execution or filing of any paper or any further act on the part of the Trustee
or the Authenticating Agent or such successor corporation.

     Any Authenticating Agent may at any time resign by giving written notice of
resignation to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice of
termination to such Authenticating Agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section.

     The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.

     Any Authenticating Agent by the acceptance of its appointment shall be
deemed to have agreed with the Trustee that: it will perform and carry out the
duties of an Authenticating Agent as herein set forth, including among other
things the duties to authenticate and deliver Securities of any series for which
it has been appointed an Authenticating Agent when presented to it in connection
with exchanges, registrations of transfer or any redemptions or conversions
thereof; it will furnish from time to time as requested by the Trustee
appropriate records of all transactions carried out by it as Authenticating
Agent and will furnish the Trustee such other information and reports as the
Trustee may reasonably require; it is eligible for appointment as Authenticating
Agent under this Section and will notify the Trustee promptly if it shall cease
to be so qualified; and it will indemnify the Trustee against any loss,
liability or expense incurred by the Trustee and will defend any claim asserted

                                       22
<PAGE>

against the Trustee by reason of any acts or failures to act of the
Authenticating Agent but it shall have no liability for any action taken by it
at the specific written direction of the Trustee.

     Section 2.10 Deferrals of Interest Payment Dates. If specified as
                  -----------------------------------
contemplated by SECTION 2.01 or SECTION 2.02 with respect to the Securities of a
particular series, so long as no Event of Default has occurred and is
continuing, the Company shall have the right, at any time during the term of
such series, from time to time to defer the payment of interest on such
Securities for such period or periods as may be specified as contemplated by
SECTION 2.01 (each, an "EXTENSION PERIOD") during which Extension Periods the
Company shall have the right to make partial payments of interest on any
interest payment date. No Extension Period shall end on a date other than an
interest payment date or extend beyond the Stated Maturity or any earlier
prepayment date. At the end of any such Extension Period the Company shall pay
all interest then accrued and unpaid on the Securities (together with Additional
Interest or other interest thereon, if any, at the rate specified for the
Securities of such series to the extent permitted by applicable law).

     During any such Extension Period, the Company shall not, and shall cause
any Subsidiary not to, (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the Company's Capital Stock (which includes Common Stock and preferred stock) or
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities that rank on a parity with or
junior to the Securities of such series or make any guarantee payments with
respect to any DPL Guarantee or other guarantee by the Company that ranks on a
parity with or junior to the Securities of such series (other than (a) dividends
or distributions payable in Common Stock; (b) any declaration of a dividend in
connection with the implementation of a Rights Plan, the issuance of any Capital
Stock of any class or series of preferred stock of the Company under any Rights
Plan or the redemption or repurchase of any rights distributed pursuant to a
Rights Plan; (c) payments under any DPL Guarantee relating to the Preferred
Securities issued by the DPL Trust holding the Securities of such series; and
(d) purchases of Common Stock related to the issuance of Common Stock or rights
under any of the Company's benefit plans for its directors, officers, employees,
consultants or advisors). Before the termination of any Extension Period, the
Company may further extend such Extension Period; provided, however, that no
Extension Period shall exceed the period or periods specified in such Securities
or extend beyond the Stated Maturity of the principal of such Securities or any
earlier prepayment date. At any time following the termination of any Extension
Period and upon the payment of all accrued and unpaid interest and any
Additional Interest or other interest then due, the Company may elect to begin a
new Extension Period, subject to the above requirements. No interest shall be
due and payable during an Extension Period, except at the end thereof. If the
Property Trustee of a DPL Trust is the only registered holder of the Securities
of a series at the time the Company elects to begin or extend an Extension
Period, the Company shall give written notice to such Property Trustee and the
Trustee of its election to begin or extend any Extension Period at least five
Business Days prior to the earlier of (i) the next succeeding date on which
Distributions on the corresponding Capital Securities issued by such DPL Trust

                                       23
<PAGE>

would have been payable but for the election to begin or extend such Extension
Period or (ii) the date the Administrative Trustees of such DPL Trust are
required to give notice to any securities exchange or other applicable
self-regulatory organization or to holders of such Capital Securities of the
record date or the date such Distributions are payable, but in any event not
less than five Business Days prior to such record date.

     If the Property Trustee of a DPL Trust is not the only holder of the
Securities of a series at the time the Company elects to begin or extend an
Extension Period, the Company shall give the holders of such Securities and the
Trustee written notice of its election to begin or extend such Extension Period
at least ten Business Days prior to the earlier of (i) the next succeeding
interest payment date or (ii) the date the Company is required to give notice of
the record or payment date of such interest payment to any applicable
self-regulatory organization or to holders of such Securities.

     An Administrative Trustee shall give notice of the Company's election to
begin or extend an Extension Period to the holders of the outstanding Preferred
Securities of such DPL Trust.

     Section 2.11 Right of Set-Off. With respect to the Securities of a series
                  ----------------
issued to a DPL Trust, notwithstanding anything to the contrary in the
Indenture, the Company shall have the right to set off any payment it is
otherwise required to make thereunder in respect of any such Security to the
extent the Company has theretofore made, or is concurrently on the date of such
payment making, a payment under the DPL Guarantee relating to such Security or
under SECTION 6.05 of this Indenture.

     Section 2.12 Shortening or Extension of Stated Maturity. If specified as
                  ------------------------------------------
contemplated by SECTION 2.01 or SECTION 2.02 with respect to the Securities of a
particular series, the Company shall have the right to (i) shorten the Stated
Maturity of the principal of the Securities of such series at any time to any
date not earlier than the first date on which the Company has the right, if any,
to redeem the Securities of such series, and (ii) extend the Stated Maturity of
the principal of the Securities of such series at any time at its election for
one or more periods, but in no event to a date later than the 49th anniversary
of the first interest payment date following the Original Issue Date of the
Securities of such series; provided that, if the Company elects to shorten or
extend the Stated Maturity, the Company shall have delivered to the Trustee an
Opinion of Counsel to the effect that such change in Stated Maturity will not
cause Securityholders to recognize income, gain or loss for United Stated
federal income tax purposes as a result of such change to the Stated Maturity
and will result in the Securityholders being subject to United States federal
income tax on the same amount, in the same manner and at the times as would have
been if such change had not occurred; and additionally, if the Company elects to
exercise its right to extend the Stated Maturity of the principal of the
Securities of such series pursuant to this clause (ii), at the time such
election is made and at the time of extension (A) the Company is not in
bankruptcy, otherwise insolvent or in liquidation, (B) the Company is not in
default in the payment of any interest or principal on such Securities, (C) in
the case of any series of Securities issued to a DPL Trust, such DPL Trust is
not in arrears on payments of Distributions on the Preferred Securities issued
by such DPL Trust and no deferred Distributions are accumulated, and (D) such
Securities are rated not less than BBB- by Standard & Poor's Ratings Services or
Baa3 by Moody's Investors Service, Inc. or the equivalent by any other
nationally recognized statistical rating organization. In the event the Company
elects to shorten or extend the Stated Maturity of the Securities of a
particular series, it shall give notice to the Trustee (not less than 45 days
prior to the effectiveness thereof), and the Trustee shall give notice of such

                                       24
<PAGE>

shortening or extension to the holders not less than 30 nor more than 60 days
prior to the effectiveness thereof.

     Section 2.13 Agreed Tax Treatment. Each Security issued hereunder shall
                  --------------------
provide that the Company and, by its acceptance of a security or a beneficial
interest therein, the holder of, and any Person that acquires a beneficial
interest in, such Security agree that for United States federal, state and local
tax purposes it is intended that such Security constitute indebtedness.

     Section 2.14 CUSIP Numbers. The Company in issuing the Securities may use
                  -------------
"CUSIP" or other similar numbers (if then generally in use), and, if so, the
Trustee shall use "CUSIP" or such other numbers in notices of redemption as a
convenience to holders of Securities; provided that any such notice may state
that no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Securities, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company will promptly notify the Trustee of any
change in the CUSIP numbers.

                                   ARTICLE III

                            REDEMPTION OF SECURITIES
                            ------------------------

     Section 3.01 Applicability of Article. Securities of any series which are
                  ------------------------
redeemable prior to Stated Maturity shall be redeemable in accordance with their
terms and (except as otherwise specified as contemplated by SECTION 2.01 for
Securities of any series) in accordance with this Article.

     Section 3.02 Mailing of Notice of Redemption. In case the Company shall
                  -------------------------------
desire to exercise any right to redeem all or, as the case may be, any part of
the Securities of any series pursuant to this Indenture, it shall give notice of
such redemption to holders of the Securities to be redeemed as hereinafter in
this Section provided.

     The Company covenants that it will pay to the Trustee or one or more Paying
Agents, on or before the Business Day next preceding the date fixed for each
redemption of Securities, a sum in cash sufficient to redeem on the redemption
date all the Securities so called for redemption at the applicable redemption
price, together with any accrued interest on the Securities to be redeemed to
but excluding the date fixed for redemption.

     Notice of redemption shall be given to the holders of Securities to be
redeemed as a whole or in part by mailing by first class mail, postage prepaid,
a notice of such redemption not less than 30 nor more than 60 days prior to the
date fixed for redemption to their last addresses as they shall appear upon the
Register, but failure to give such notice by mailing in the manner herein
provided to the holder of any Security designated for redemption as a whole or
in part, or any defect therein, shall not affect the validity of the proceedings
for the redemption of any other Security.

                                       25
<PAGE>

     Any notice which is mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the holder
receives the notice.

     Each such notice of redemption shall identify the Securities to be redeemed
(including CUSIP numbers) and specify the date fixed for redemption and the
redemption price at which Securities are to be redeemed (or if the redemption
price cannot be calculated prior to the time the notice is required to be given,
the manner of calculation thereof), and shall state that payment of the
redemption price of the Securities or portions thereof to be redeemed will be
made at any of the offices or agencies to be maintained by the Company in
accordance with the provisions of SECTION 4.02 with respect to the Securities to
be redeemed, upon presentation and surrender of such Securities or portions
thereof, and that, if applicable, interest accrued to the date fixed for
redemption will be paid as specified in said notice and on and after said date
interest thereon will cease to accrue and shall also specify, if applicable, the
conversion price and the date on which the right to convert the Securities will
expire and that holders must comply with Article XV hereof in order to convert
their Securities. If less than all the Securities of any series are to be
redeemed, the notice of redemption to each holder shall specify such holder's
Securities of such series to be redeemed as a whole or in part. In case any
Security is to be redeemed in part only, the notice which relates to such
Security shall state the portion of the principal amount thereof to be redeemed
(which shall be equal to the minimum authorized denomination for Securities of
such series or any whole multiple thereof), and shall state that on and after
the redemption date, upon surrender of such Security, the holder will receive
the redemption price in respect to the principal amount thereof called for
redemption and, without charge, a new Security or Securities of the same series
of authorized denominations for the principal amount thereof remaining
unredeemed.

     If the Securities of any series are to be redeemed, the Company shall give
the Trustee, at least 60 days in advance of the date fixed for redemption,
notice of the aggregate principal amount of Securities of such series to be
redeemed, and, if less than all the Securities of such series are to be
redeemed, thereupon the Trustee shall select, by lot, or in any manner it shall
deem fair, the Securities of such series to be redeemed as a whole or in part
and shall thereafter promptly notify the Company in writing of the particular
Securities of such series or portions thereof to be redeemed. If the Securities
of any series to be redeemed consist of Securities having different dates on
which the principal or any installment of principal is payable or different
rates of interest, if any, or different methods by which interest may be
determined or have any other different tenor or terms, then the Company may, by
written notice to the Trustee, direct that Securities of such series to be
redeemed shall be selected from among groups of such Securities having specified
tenor or terms and the Trustee shall thereafter select the particular Securities
to be redeemed in the manner set forth in the preceding sentence from among the
group of such Securities so specified.

     Section 3.03 When Securities Called for Redemption Become Due and Payable.
                  ------------------------------------------------------------
If the giving of notice of redemption shall have been completed as above
provided, the Securities or portions of Securities specified in such notice
shall become due and payable on the date and at the place or places stated in
such notice at the applicable redemption price, together, if applicable, with
any interest accrued (including any Additional Interest or other interest) to
but excluding the date fixed for redemption, and on and after such date fixed
for redemption (unless the Company shall default in the payment of such
Securities at the applicable redemption price, together with any interest

                                       26
<PAGE>

accrued to the date fixed for redemption) any interest on the Securities or
portions of Securities so called for redemption shall cease to accrue, and,
except as provided in SECTIONS 7.05 and 12.04, such Securities shall cease from
and after the date fixed for redemption to be entitled to any benefit or
security under this Indenture, and the holders thereof shall have no right in
respect of such Securities except the right to receive the redemption price
thereof and any unpaid interest accrued to but excluding the date fixed for
redemption. On presentation and surrender of such Securities at said place of
payment in said notice specified, such Securities or portions thereof shall be
paid and redeemed by the Company at the applicable redemption price, together
with any interest accrued to but excluding the date fixed for redemption;
provided, however, that, except as otherwise specified as contemplated by
SECTION 2.01, any regular payment of interest becoming due on the date fixed for
redemption shall be payable to the holders of the Securities registered as such
on the relevant record date as provided in Article II hereof. Upon surrender of
any Security which is redeemed in part only, the Company shall execute and the
Trustee shall authenticate and deliver at the expense of the Company a new
Security of the same series of like tenor and terms of authorized denomination
in principal amount equal to the unredeemed portion of the Security so
surrendered; except that if a global Security is so surrendered, the Company
shall execute, and the Trustee shall authenticate and deliver to the Depositary
for such global Security, without service charge, a global Security in a
denomination equal to and in exchange for the unredeemed portion of the
principal of the global Security so surrendered.

     If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid, bear interest from the
date fixed for redemption at the rate borne by or prescribed therefor in the
Security, or, in the case of a Security which does not bear interest, at the
rate of interest set forth therefor in the Security to the extent permitted by
law.

                                   ARTICLE IV

                      PARTICULAR COVENANTS OF THE COMPANY
                      -----------------------------------

     The Company covenants as follows:

     Section 4.01 Payment of Principal of and Interest on Securities. The
                  --------------------------------------------------
Company will duly and punctually pay or cause to be paid the principal of and
interest (including interest accruing during an Extension Period or on or after
the filing of a petition in bankruptcy or reorganization relating to the
Company, and including any rate of interest applicable upon default, whether or
not a claim for post-petition interest is allowed in such proceeding), if any,
on each of the Securities at the time and places and in the manner provided
herein and in the Securities. Except as otherwise specified as contemplated by
SECTION 2.01, if the Securities of any series bear interest, each installment of
interest on the Securities of such series may at the option of the Company be
paid (i) by mailing a check or checks for such interest payable to the Person
entitled thereto pursuant to SECTION 2.03 to the address of such person as it
appears on the Register of the Securities of such series or (ii) by transfer to
an account maintained by the Person entitled thereto as specified in the
Register of Securities; provided that proper transfer instructions have been
received by the record date.

                                       27
<PAGE>

     Section 4.02 Maintenance of Offices or Agencies for Registration of
                  ------------------------------------------------------
Transfer, Exchange and Payment of Securities. So long as any of the Securities
--------------------------------------------
shall remain outstanding, the Company will maintain an office or agency in the
City of Dayton, State of Ohio, or in The City of New York, State of New York,
where the Securities may be presented for registration, conversion, exchange and
registration of transfer as in this Indenture provided, and where notices and
demands to or upon the Company in respect of the Securities or of this Indenture
may be served, and where the Securities may be presented for payment. In case
the Company shall designate and maintain some office or agency other than the
previously designated office or agency, it shall give the Trustee prompt written
notice thereof. In case the Company shall fail to maintain any such office or
agency or shall fail to give such notice of the location or of any change in the
location thereof to the Trustee, presentations and demands may be made and
notices may be served at the principal office of the Trustee.

     In addition to such office or agency, the Company may from time to time
constitute and appoint one or more other offices or agencies for such purposes
with respect to Securities of any series, and one or more paying agents for the
payment of Securities of any series, in such cities or in one or more other
cities, and may from time to time rescind such appointments, as the Company may
deem desirable or expedient, and as to which the Company has notified the
Trustee; provided, however, that no such appointment or rescission shall in any
manner relieve the Company of its obligation to maintain such office or agency
in the said Cities of Dayton or New York, where Securities of such series may be
presented for payment.

     Section 4.03 Appointment to Fill a Vacancy In The Office of Trustee. The
                  ------------------------------------------------------
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in SECTION 7.10, a Trustee, so that there
shall at all times be a Trustee with respect to each series of Securities
hereunder.

     Section 4.04 Duties of Paying Agent. (a) If the Company shall appoint a
                  ----------------------
Paying Agent other than the Trustee with respect to Securities of any series, it
will cause such Paying Agent to execute and deliver to the Trustee an instrument
in which such Paying Agent shall agree with the Trustee, subject to the
provisions of this Section and SECTION 12.03,

          (1) That it will hold all sums held by it as such agent for the
     payment of the principal of or interest, if any, on the Securities of such
     series (whether such sums have been paid to it by the Company or by any
     other obligor on the Securities of such series) in trust for the benefit of
     the holders of the Securities of such series entitled to such principal or
     interest and will notify the Trustee of the receipt of sums to be so held,

          (2) That it will give the Trustee notice of any failure by the Company
     (or by any other obligor on the Securities of such series) to make any
     payment of the principal of or interest on the Securities of such series
     when the same shall be due and payable, and

          (3) That it will at any time during the continuance of any Event of
     Default, upon the written request of the Trustee, deliver to the Trustee
     all sums so held in trust by it.

                                       28
<PAGE>

          (b) Whenever the Company shall have one or more Paying Agents with
respect to the Securities of any series, it will, prior to each due date of the
principal of or any interest on a Security of such series, deposit with a Paying
Agent of such series a sum sufficient to pay the principal or interest so
becoming due, such sum to be held in trust for the benefit of the holders of
Securities of such series entitled to such principal or interest, and (unless
such Paying Agent is the Trustee) the Company will promptly notify the Trustee
of its action or failure so to act.

          (c) If the Company shall act as its own Paying Agent with respect to
the Securities of any series, it will, on or before each due date of the
principal of or any interest on a Security of such series, set aside, segregate
and hold in trust for the benefit of the holder of such Security, a sum
sufficient to pay such principal or interest so becoming due and will notify the
Trustee of such action, or any failure by it or any other obligor on the
Securities of such series to take such action and will at any time during the
continuance of any Event of Default, upon the written request of the Trustee,
deliver to the Trustee all sums so held in trust by it.

          (d) Anything in this Section to the contrary notwithstanding, the
Company may, at any time, for the purpose of obtaining a satisfaction and
discharge of this Indenture with respect to one or more or all series of
Securities hereunder, or for any other reason, pay or cause to be paid to the
Trustee all sums held in trust for such series by it, or any Paying Agent
hereunder, as required by this Section, such sums are to be held by the Trustee
upon the trust herein contained.

          (e) Anything in this Section to the contrary notwithstanding, the
agreement to hold sums in trust as provided in this Section is subject to the
provisions of SECTIONS 12.03 and 12.04.

     Section 4.05 Further Assurances. From time to time whenever reasonably
                  ------------------
demanded by the Trustee, the Company will make, execute and deliver or cause to
be made, executed and delivered any and all such further and other instruments
and assurances and take all such further action as may be reasonably necessary
or proper to carry out the intention of or to facilitate the performance of the
terms of this Indenture or to secure the rights and remedies hereunder of the
holders of the Securities of any series.

     Section 4.06 Officers' Certificate As to Defaults; Notices of Certain
                  --------------------------------------------------------
Defaults. The Company will, so long as any of the Securities are outstanding,
--------
deliver to the Trustee no later than 120 days after the end of each calendar
year, beginning with the year 2002, a certificate signed by the Company's
principal executive officer, principal financial officer or principal accounting
officer stating that a review has been made under his or her supervision of the
activities of the Company during such year and of the performance under this
Indenture and, to the best of his or her knowledge, the Company has complied
with all conditions and covenants under this Indenture throughout such calendar
year, or if there has been a default in the fulfillment of any such obligation,
specifying each such default known and the nature and status thereof. For
purposes of this Section, such compliance shall be determined without regard to
any period of grace or requirement of notice provided under this Indenture.

     Section 4.07 Waiver of Covenants. The Company may omit in any particular
                  -------------------
instance to comply with any covenant or condition specifically contained in this
Indenture for the benefit of one or more series of Securities, if before the

                                       29
<PAGE>

time for such compliance the holders of a majority in principal amount of the
Securities of all series affected (all series voting as one class) at the time
outstanding (determined as provided in SECTION 8.04) shall waive such compliance
in such instance, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver shall
become effective, the obligations of the Company and the duties of the Trustee
in respect of any such covenant or condition shall remain in full force and
effect.

     Section 4.08 Additional Tax Sums. In the case of the Securities of a series
                  -------------------
issued to a DPL Trust, except as otherwise specified as contemplated by SECTION
2.01 or SECTION 2.02, in the event that (i) a DPL Trust is the holder of all of
the Outstanding Securities of such series, and (ii) the Company shall not have
(a) redeemed the Securities of such series or (b) terminated such DPL Trust
pursuant to the termination provisions of the related Trust Agreement, the
Company shall pay to such DPL Trust (and any permitted successor or assign under
the related Trust Agreement) for so long as such DPL Trust (or its permitted
successor or assignee) is the registered holder of any Securities of such
series, such additional amounts as may be necessary in order that the amount of
Distributions then due and payable by such DPL Trust on the related Preferred
Securities and Common Securities that at any time remain outstanding in
accordance with the terms thereof shall not be reduced as a result of any
additional taxes, duties and other governmental charges to which such DPL Trust
has become subject (but not including withholding taxes imposed on holders of
such Preferred Securities and Common Securities) (the "ADDITIONAL TAX SUMS").
Whenever in this Indenture or the Securities there is a reference in any context
to the payment of principal of or interest on the Securities, such reference
shall be deemed to include payment of the Additional Tax Sums provided for in
this paragraph to the extent that, in such context, Additional Tax Sums are,
were or would be payable in respect thereof pursuant to the provisions of this
Section and express reference to the payment of Additional Tax Sums (if
applicable) in any provisions hereof shall not be construed as excluding
Additional Tax Sums in those provisions hereof where such express reference is
not made; provided, however, that the deferral of the payment of interest
pursuant to SECTION 2.10 or the Securities shall not defer the payment of any
Additional Tax Sums that may be then due and payable.

     Section 4.09 Additional Covenants. The Company covenants and agrees with
                  --------------------
each holder of Securities of a series issued to a DPL Trust that it shall not,
and it shall cause any Subsidiary not to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any shares of the Company's Capital Stock (which includes
Common Stock and preferred stock), or (ii) make any payment of principal of or
interest or premium, if any, on or repay, repurchase or redeem any debt
securities that rank on a parity with or junior to the Securities of such series
or make any guarantee payments with respect to any DPL Guarantee or other
guarantee by the Company that ranks on a parity with or junior to the Securities
of such series (other than (a) dividends or distributions payable in Common
Stock; (b) any declaration of a dividend in connection with the implementation
of a Rights Plan, the issuance of any Capital Stock of any class or series of
preferred stock of the Company under any Rights Plan or the redemption or
repurchase of any rights distributed pursuant to a Rights Plan; (c) payments
under any DPL Guarantee relating to the Preferred Securities issued by the DPL
Trust holding the Securities of such series; and (d) purchases of Common Stock
related to the issuance of Common Stock or rights under any of the Company's

                                       30
<PAGE>

benefit plans for its directors, officers, employees, consultants or advisors)
if at such time (i) there shall have occurred any event of which the Company has
actual knowledge that (a) with the giving of notice or the lapse of time or
both, would constitute an Event of Default hereunder and (b) in respect of which
the Company shall not have taken reasonable steps to cure, (ii) the Company
shall be in default with respect to its payment of any obligations under the
related DPL Guarantee or (iii) the Company shall have given notice of its
election to begin an Extension Period as provided in SECTION 2.10 and shall not
have rescinded such notice, or such Extension Period, or any extension thereof,
shall be continuing.

     The Company also covenants with each holder of Securities of a series
issued to a DPL Trust (i) to maintain directly or indirectly 100% ownership of
the Common Securities of such DPL Trust; provided, however, that any permitted
successor or assignee of the Company hereunder may succeed to the Company's
ownership of such Common Securities, (ii) not to voluntarily terminate, wind up
or liquidate such DPL Trust, except (a) in connection with a prepayment in full
of the Securities or a distribution of the Securities of such series to the
holders of Preferred Securities in liquidation of such DPL Trust or (b) in
connection with certain mergers, consolidations or amalgamations permitted by
the relevant Trust Agreement and (iii) to use its reasonable efforts, consistent
with the terms and provisions of such Trust Agreement, to cause such DPL Trust
to remain classified as a grantor trust and not an association taxable as a
corporation for United States federal income tax purposes.

     Section 4.10 Calculation of Original Issue Discount. The Company shall file
                  --------------------------------------
with the Trustee promptly at the end of each calendar year (i) a written notice
specifying the amount of original issue discount (including daily rates and
accrual periods) accrued on outstanding Securities as of the end of such year
and (ii) such other specific information relating to such original issue
discount as may then be relevant under the Internal Revenue Code of 1986, as
amended from time to time.

                                    ARTICLE V

                SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY
                -------------------------------------------------
                                AND THE TRUSTEE
                                ---------------

     Section 5.01 Company to Furnish Trustee Information As to The Names and
                  ----------------------------------------------------------
Addresses of Securityholders. The Company covenants and agrees that it will
----------------------------
furnish or cause to be furnished to the Trustee, semiannually not more than 5
days after March 15 and September 15 of each year beginning with March 15, 2002,
and at such other times as the Trustee may request in writing within 30 days
after receipt by the Company of any such request, a list in such form as the
Trustee may reasonably require containing all information in the possession or
control of the Company, or any Paying Agent or any registrar of the Securities
of each series, other than the Trustee, as to the names and addresses of the
holders of Securities of such series obtained (in the case of each list other
than the first list) since the date as of which the next previous list was
furnished; provided, however, that if the Trustee shall be the registrar of the
Securities of such series, no such list need be furnished. Any such list may be
dated as of a date not more than fifteen days prior to the time such information
is furnished or caused to be furnished, and need not include information
received after such date.

                                       31
<PAGE>

     Section 5.02 Trustee to Preserve Information As to The Names and Addresses
                  -------------------------------------------------------------
of Securityholders Received By It. (a) The Trustee shall preserve, in as current
---------------------------------
a form as is reasonably practicable, all information as to the names and
addresses of the holders of Securities of each series (1) contained in the most
recent list furnished to it as provided in SECTION 5.01 and (2) received by it
in the capacity of Paying Agent or registrar (if so acting). The Trustee may
destroy any list furnished to it as provided in SECTION 5.01 upon receipt of a
new list so furnished.

          (b) In case three or more holders of Securities of any series
(hereinafter referred to as "APPLICANTS") apply in writing to the Trustee, and
furnish to the Trustee reasonable proof that each such applicant has owned a
Security for a period of at least six months preceding the date of such
application, and such application states that the applicants desire to
communicate with other holders of Securities of any series or with holders of
all Securities with respect to their rights under this Indenture or under such
Securities, and is accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, then the Trustee shall,
within five Business Days after the receipt of such application, at its
election, either

          (1) afford such applicants access to the information preserved at the
     time by the Trustee in accordance with the provisions of subsection (a) of
     this Section, or

          (2) inform such applicants as to the approximate number of holders of
     Securities of such series or all Securities, as the case may be, whose
     names and addresses appear in the information preserved at the time by the
     Trustee in accordance with the provisions of subsection (a) of this
     Section, and as to the approximate cost of mailing to such Securityholders
     the form of proxy or other communication, if any, specified in such
     application.

     If the Trustee shall elect not to afford such access to such information,
the Trustee shall, upon the written request of such applicants, mail to each of
the holders of Securities of such series, or all Securities, as the case may be,
whose name and address appear in the information preserved at the time by the
Trustee in accordance with the provisions of subsection (a) of this Section, a
copy of the form of proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the Trustee of the
material to be mailed and after payment, or provision for the payment, of the
reasonable expenses of mailing, unless within five days after such tender, the
Trustee shall mail to such applicants and file with the Commission, together
with a copy of the material to be mailed, a written statement to the effect
that, in the opinion of the Trustee, such mailing would be contrary to the best
interests of the holders of Securities of such series or all Securities, as the
case may be, or would be in violation of applicable law. Such written statement
shall specify the basis of such opinion. If the Commission, after opportunity
for a hearing upon the objections specified in the written statement so filed,
shall enter an order refusing to sustain any of such objections or if, after the
entry of an order sustaining one or more of such objections, the Commission
shall find, after notice and opportunity for hearing, that all the objections so
sustained have been met and shall enter an order so declaring, the Trustee shall
mail copies of such material to all the holders of Securities of such series or
all Securities, as the case may be, with reasonable promptness after the entry
of such order and the renewal of such tender; otherwise the Trustee shall be
relieved of any obligation or duty to such applicants respecting their
application.

                                       32
<PAGE>

          (c) Each and every holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any Paying Agent nor any registrar shall be held accountable by
reason of the disclosure of any such information as to the names and addresses
of the holders of Securities in accordance with the provisions of subsection (b)
of this Section, regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason of mailing
any material pursuant to a request made under said subsection (b).

          (d) If there shall be different Trustees acting hereunder with respect
to separate series of Securities, applicants shall make separate applications
hereunder to each such Trustee, and such Trustees shall collaborate, if
necessary, in acting under this Section.

     Section 5.03 Annual and Other Reports to Be Filed By Company With Trustee.
                  ------------------------------------------------------------
(a) The Company covenants and agrees to file with the Trustee within fifteen
days after the Company is required to file the same with the Commission, copies
of the annual reports and of the information, documents and other reports (or
copies of such portions of any of the foregoing as the Commission may from time
to time by rules and regulations prescribe) which the Company may be required to
file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange
Act; or, if the Company is not required to file information, documents or
reports pursuant to either of such Sections, then it will file with the Trustee
and the Commission, in accordance with rules and regulations prescribed from
time to time by the Commission, such of the supplementary and periodic
information, documents and reports which may be required pursuant to Section 13
of the Exchange Act in respect of a security listed and registered on a national
securities exchange as may be prescribed from time to time in such rules and
regulations.

          (b) The Company covenants and agrees to file with the Trustee and the
Commission, in accordance with the rules and regulations prescribed from time to
time by the Commission, such additional information, documents, and reports with
respect to compliance by the Company with the conditions and covenants provided
for in this Indenture as may be required from time to time by such rules and
regulations.

          (c) The Company covenants and agrees to transmit to the holders of
Securities within 30 days after the filing thereof with the Trustee, in the
manner and to the extent provided in subsection (c) of SECTION 5.04 with respect
to reports pursuant to subsection (a) of said SECTION 5.04, such summaries of
any information, documents and reports required to be filed by the Company
pursuant to subsections (a) and (b) of this Section as may be required by rules
and regulations prescribed from time to time by the Commission.

          (d) Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).

     Section 5.04 Trustee to Transmit Annual Report to Securityholders. (a) On
                  ----------------------------------------------------
or before March 15, 2002, and on or before March 15 in every year thereafter, if
and so long as any Securities are outstanding hereunder, the Trustee shall

                                       33
<PAGE>

transmit to the Securityholders as hereinafter in this Section provided, a brief
report dated as of the preceding January 15 with respect to any of the following
events which may have occurred within the previous twelve (12) months (but if no
such event has occurred within such period no report need be transmitted):

          (1) Any change to its eligibility under SECTION 7.09, and its
     qualifications under SECTION 7.08;

          (2) The creation of or any material change to a relationship which,
     with the occurrence of an Event of Default, would create a conflicting
     interest within the meaning of the Trust Indenture Act;

          (3) The character and amount of any advances (and if the Trustee
     elects so to state, the circumstances surrounding the making thereof) made
     by the Trustee (as such) which remain unpaid on the date of such report,
     and for the reimbursement of which it claims or may claim a lien or charge
     prior to that of the Securities of any series on any property or funds held
     or collected by it as Trustee, except that the Trustee shall not be
     required (but may elect) to report such advances if such advances so
     remaining unpaid aggregate not more than one-half of one percent of the
     principal amount of the Securities of all series outstanding as of the date
     of such report;

          (4) Any change to the amount, interest rate, and maturity date of all
     other indebtedness owing by the Company (or by any other obligor on the
     Securities) to the Trustee in its individual capacity, on the date of such
     report, with a brief description of any property held as collateral
     security therefor, except indebtedness based upon a creditor relationship
     arising in any manner described in paragraph (2), (3), (4), or (6) of
     subsection (b) of SECTION 7.13;

          (5) Any change to the property and funds, if any, physically in the
     possession of the Trustee (as such) on the date of such report;

          (6) Any additional issue of Securities which the Trustee has not
     previously reported to Securityholders; and

          (7) Any action taken by the Trustee in the performance of its duties
     under this Indenture which it has not previously reported to
     Securityholders and which in its opinion materially affects the Securities
     of any series, except action in respect of a default, notice of which has
     been or is to be withheld by it in accordance with the provisions of
     SECTION 6.07.

          (b) The Trustee shall transmit to the Securityholders, as hereinafter
provided, a brief report with respect to the character and amount of any
advances (and if the Trustee elects so to state, the circumstances surrounding
the making thereof) made by the Trustee (as such) since the date of the last
report transmitted pursuant to the provisions of subsection (a) of this Section
(or if such report has not yet been so transmitted, since the date of execution
of this Indenture), for the reimbursement of which it claims or may claim a lien
or charge prior to that of the Securities of any series on property or funds
held or collected by it as Trustee, and which it has not previously reported
pursuant to this subsection, except that the Trustee shall not be required (but

                                       34
<PAGE>

may elect) to report such advances if such advances so remaining unpaid
aggregate not more than ten percent of the principal amount of Securities of all
series outstanding as of the date of such report, such report to be transmitted
within 90 days after such time.

          (c) Reports pursuant to this Section shall be transmitted by mail to
all holders of Securities of any series, as the names and addresses of such
holders shall appear upon the Register of the Securities of such series.

          (d) A copy of each such report shall, at the time of such transmission
to Securityholders, be filed by the Trustee with each stock exchange upon which
the Securities of any series are listed and also with the Commission. The
Company will promptly notify the Trustee when and as the Securities of any
series become listed on any stock exchange.

                                   ARTICLE VI

                   REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
                   -------------------------------------------
                              ON EVENT OF DEFAULT
                              -------------------

           Section 6.01 Events of Default Defined. The term "EVENT OF DEFAULT"
                        -------------------------
whenever used herein with respect to Securities of any series shall mean any one
of the following events:

          (a) Default in the payment of any installment of interest upon any of
the Securities of such series as and when the same shall become due and payable,
and continuance of such default for a period of 30 days (subject to the deferral
of any due date in the case of an Extension Period); or

          (b) Default in the payment of all or any part of the principal of any
of the Securities of such series as and when the same shall become due and
payable whether upon Maturity, upon any redemption, by declaration or otherwise;
or

          (c) Failure on the part of the Company duly to observe or perform in
any material respect any covenants or agreements (other than covenants to pay
interest, principal and premium, which are subject to subsections (a) and (b)
above of this Section) on the part of the Company in the Securities or in this
Indenture (including any supplemental indenture or pursuant to any Officers'
Certificate as contemplated by SECTION 2.01) specifically contained for the
benefit of the Securities of such series, for a period of 60 days after there
has been given, by registered or certified mail, to the Company by the Trustee,
or to the Company and the Trustee by the holders of not less than 25% in
principal amount of the Securities of such series and all other series so
benefited (all series voting as one class) at the time outstanding under this
Indenture a written notice specifying such failure and stating that such is a
"NOTICE OF DEFAULT" hereunder; or

          (d) The commencement by the Company of a voluntary case under Chapter
7 or Chapter 11 of the federal Bankruptcy Code or any other similar state or
federal law now or hereafter in effect, or the consent by the Company to the
entry of a decree or order for relief in an involuntary case under any such law,
or the consent by the Company to the appointment of a liquidating agent or
committee, conservator or receiver; or

                                       35
<PAGE>

          (e) The entry of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Company in an involuntary case
under Chapter 7 or Chapter 11 of the federal Bankruptcy Code or any other
similar state or federal law now or hereafter in effect, and the continuance of
any such decree or order unstayed and in effect for a period of 90 days, or the
appointment of a liquidating agent or committee, conservator or receiver, and
the continuance of any such appointment unstayed and in effect for a period of
90 days.

     If an Event of Default under clauses 6.01(a), 6.01(b) or 6.01(c) shall have
occurred and be continuing (but, in the case of clause 6.01(c), only if the
Event of Default is with respect to less than all series of Securities then
outstanding under this Indenture), unless the principal of all the Securities
shall have already become due and payable, either the Trustee or the holders of
not less than 25% in principal amount of all the then outstanding Securities of
the series as to which such Event of Default under clauses 6.01(a), 6.01(b) or
6.01(c) has occurred (each such series voting as a separate class in the case of
an Event of Default under clauses 6.01(a) or 6.01(b), and all such series voting
as one class in the case of an Event of Default under clause 6.01(c)), by notice
in writing to the Company (and to the Trustee if given by Securityholders) may
declare the principal amount (or if Securities of any series are Original Issue
Discount Securities, such portion of the principal amount as may be specified in
the terms of such series) of all the Securities of such series, or of all such
series in the case of an Event of Default under clause 6.01(c), in each case
together with any accrued interest, to be due and payable immediately, and upon
any such declaration the same shall become and shall be immediately due and
payable; provided, however, that in the case of the Securities of a series
issued to a DPL Trust, if upon an Event of Default, the Trustee or the holders
of at least 25% in principal amount of the outstanding Securities of such series
fail to declare the principal of all the Securities of that series to be
immediately due and payable, the holders of at least 25% in aggregate
liquidation amount of the corresponding series of Preferred Securities then
outstanding shall have such right by a notice in writing to the Company and the
Trustee. If an Event of Default under clauses 6.01(c), 6.01(d), or 6.01(e) shall
have occurred and be continuing (but, in the case of clause 6.01(c)), only if
the Event of Default is with respect to all Securities then outstanding under
the Indenture), then and in each and every such case, unless the principal of
all the Securities shall have already become due and payable, either the Trustee
or the holders of not less than 25% in principal amount of all the then
outstanding Securities of each series as to which such Event of Default under
clauses 6.01(c), 6.01(d), or 6.01(e) above has occurred (voting as one class),
by notice in writing to the Company (and to the Trustee if given by
Securityholders) may declare the principal amount (or if Securities of any
series are Original Issue Discount Securities, such portion of the principal
amount as may be specified in the terms of such series) of all the Securities as
to which the Event of Default under clauses 6.01(c), 6.01(d), or 6.01(e) above
has occurred, together with any accrued interest, to be due and payable
immediately, and upon any such declaration the same shall become and shall be
immediately due and payable, anything contained in this Indenture or in the
Securities to the contrary notwithstanding; provided, however, that in the case
of the Securities of a series issued to a DPL Trust, if upon an Event of
Default, the Trustee or the holders of not less than 25% in principal amount of
the outstanding Securities of that series fail to declare the principal of all
the Securities of that series to be immediately due and payable, the holders of
at least 25% in aggregate liquidation amount of the corresponding series of
Preferred Securities then outstanding shall have such right by a notice in
writing to the Company and the Trustee. The foregoing provisions, however, are
subject to the condition that if, at any time after the principal amount (or

                                       36
<PAGE>

specified portion thereof) of the Securities of any one or more series (or of
all the Securities, as the case may be) shall have been so declared due and
payable, and before any judgment or decree for the payment of moneys due shall
have been obtained or entered as hereinafter provided, the Company shall pay or
shall deposit with the Trustee a sum sufficient to pay all matured installments
of interest upon all the Securities of such series (or upon all the Securities,
as the case may be) and the principal of any and all Securities of such series
(or of any and all the Securities, as the case may be) which shall have become
due otherwise than by declaration (with interest on overdue installments of
interest to the extent permitted by law and on such principal at the rate or
rates of interest borne by, or prescribed therefor in, the Securities of each
such series to the date of such payment or deposit) and the amounts payable to
the Trustee under SECTION 7.06, and any and all defaults under the Indenture
with respect to Securities of such series (or all Securities, as the case may
be), other than the nonpayment of principal of and any accrued interest on
Securities of such series (or any Securities, as the case may be) which shall
have become due by declaration, shall have been cured, remedied or waived as
provided in SECTION 6.06, then and in every such case the holders of a majority
in principal amount of the Securities of such series (or of all the Securities,
as the case may be) then outstanding and as to which such Event of Default has
occurred (such series or all series voting as one class, if more than one series
are so entitled) by written notice to the Company and to the Trustee, may
rescind and annul such declaration and its consequences. In the case of
Securities issued to a DPL Trust, should the holders of such Securities fail to
annul such declaration and waive such default, the holders of a majority in
aggregate liquidation preference of related Preferred Securities shall have such
right; but no such rescission and annulment shall extend to or shall affect any
subsequent default, or shall impair any right consequent thereon.

     In case the Trustee, any holder of Securities or any holder of Preferred
Securities shall have proceeded to enforce any right under this Indenture and
such proceedings shall have been discontinued or abandoned because of such
rescission or annulment or for any other reason or shall have been determined
adversely to the Trustee, such holder of Securities or such holder of Preferred
Securities then and in every such case the Company, the Trustee, the holders of
the Securities of such series (or of all the Securities, as the case may be) and
the holders of Preferred Securities shall be restored respectively to their
former positions and rights hereunder, and all rights, remedies and powers of
the Company and the Trustee, the holders of the Securities of such series (or of
all the Securities, as the case may be) and the holders of Preferred Securities
shall continue as though no such proceedings had been taken.

     Section 6.02 Covenant of Company to Pay to Trustee Whole Amount Due On
                  ---------------------------------------------------------
Securities On Default In Payment of Interest or Principal. The Company covenants
---------------------------------------------------------
that (1) in case default shall be made in the payment of any installment of
interest on any of the Securities of any series as and when the same shall
become due and payable, and such default shall have continued for a period of 30
days (subject to the deferral of any due date in the case of an Extension
Period), or (2) in case default shall be made in the payment of all or any part
of the principal of any of the Securities of any series as and when the same
shall become due and payable, whether upon Maturity, upon any redemption, by
declaration or otherwise, then, upon demand of the Trustee, the Company will pay
to the Trustee, for the benefit of the holders of the Securities of such series,
the whole amount that then shall have become due and payable on all such
Securities of such series for principal or interest, or both, as the case may
be, with interest upon the overdue principal and installments of interest (to
the extent permitted by law) at the rate or rates of interest borne by or

                                       37
<PAGE>

prescribed therefor in the Securities of such series; and, in addition thereto,
such further amount as shall be sufficient to cover the costs and expenses of
collection, including reasonable compensation to the Trustee, its agents and
counsel, and any expenses or disbursements reasonably incurred, and all
reasonable advances made hereunder by the Trustee, its agents, attorneys and
counsel, except as a result of its negligence or bad faith.

     In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor upon such
Securities, and collect in the manner provided by law out of the property of the
Company or any other obligor upon such Securities wherever situated the moneys
adjudged or decreed to be payable.

     The Trustee shall be entitled and empowered, either in its own name or as
trustee of an express trust, or as attorney-in-fact for the holders of the
Securities of any series, or in any one or more of such capacities (irrespective
of whether the principal of the Securities of such series shall then be due and
payable, whether upon Maturity, upon any redemption, by declaration or
otherwise, and irrespective of whether the Trustee shall have made any demand
pursuant to the provisions of this Section) to file and prove a claim or claims
for the whole amount of principal (or, if the Securities of such series are
Original Issue Discount Securities, such portion of the principal amount as may
be specified in the terms of such series) and interest owing and unpaid in
respect of the Securities of such series and to file such other documents as may
be necessary or advisable in order to have the claims of the Trustee (including
any claim for reasonable compensation of the Trustee, its agents and counsel,
and for reimbursement of all expenses and disbursements reasonably incurred, and
all reasonable advances made hereunder by the Trustee, its agents and counsel,
except as a result of its negligence or willful misconduct) and of the holders
of the Securities of such series allowed in any equity receivership, insolvency,
bankruptcy, liquidation, arrangement, readjustment, reorganization or any other
judicial proceedings relative to the Company or any other obligor on the
Securities of such series or their creditors, or their property. The Trustee is
hereby irrevocably appointed (and the successive respective holders of the
Securities of each series by taking and holding the same shall be conclusively
deemed to have so appointed the Trustee) the true and lawful attorney-in-fact of
the respective holders of the Securities of such series, with authority to make
and file in the respective names of the holders of the Securities of such
series, or on behalf of the holders of the Securities of such series as a class,
any proof of debt, amendment of proof of debt, claim, petition or other document
in any such proceeding and to collect and receive payment of any sums becoming
distributable on account thereof, and to execute any such other papers and
documents and to do and perform any and all such acts and things for and on
behalf of such holders of the Securities of such series, as may be necessary or
advisable in the opinion of the Trustee in order to have the respective claims
of the Trustee and of the holders of the Securities of such series allowed in
any such proceeding, and to collect and receive payment of or on account of such
claims and to distribute the same, and any receiver, assignee, trustee,
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the holders, to pay to the Trustee any amount due to it

                                       38
<PAGE>

under SECTION 7.06; provided, however, that nothing herein shall be deemed to
authorize the Trustee to authorize or consent to or vote for or accept or adopt
on behalf of any Securityholder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities of such series or the rights
of any holder thereof, or to authorize the Trustee to vote in respect of the
claim of any holder of Securities of such series in any such proceeding.

     All rights of action and of asserting claims under this Indenture, or under
any of the Securities of any series, may be enforced by the Trustee without the
possession of any of the Securities of such series, or the production thereof on
any trial or other proceeding relative thereto, and any such suit or proceeding
instituted by the Trustee, shall be brought in its own name as trustee of an
express trust, and any recovery of judgment shall be, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
such Trustee, its agents and counsel, for the ratable benefit of the holders of
the Securities of such series.

     Section 6.03 Application of Moneys Collected By Trustee. Any moneys
                  ------------------------------------------
collected by the Trustee pursuant to SECTION 6.02 shall be applied in the order
following, at the date or dates fixed by the Trustee for the distribution of
such moneys, upon presentation of the several Securities in respect of which
moneys have been collected, and stamping thereon the payment, if only partially
paid, and upon surrender thereof if fully paid:

          First: To the payment of reasonable costs and expenses of collection,
          -----
     and of all amounts payable to the Trustee under SECTION 7.06;

          Second: In case the principal of the outstanding Securities in respect
          ------
     of which moneys have been collected shall not have become due and be
     unpaid, to the payment of any unpaid interest on such Securities, in the
     order of the maturity of the installments of such interest, with interest
     upon the overdue installments of interest (so far as permitted by law and
     to the extent that such interest has been collected by the Trustee) at the
     rate or rates of interest borne by, or prescribed therefor in, such
     Securities, such payments to be made ratably to the persons entitled
     thereto, without discrimination or preference;

          Third: In case the principal of the outstanding Securities in respect
          -----
     of which such moneys have been collected shall have become due and be
     unpaid, whether upon Maturity, upon any redemption, by declaration or
     otherwise, to the payment of the whole amount then owing and unpaid upon
     such Securities for principal and interest, if any, with interest on the
     overdue principal and any installments of interest (so far as permitted by
     law and to the extent that such interest has been collected by the Trustee)
     at the rate or rates of interest borne by, or prescribed therefor in, such
     Securities; and in case such moneys shall be insufficient to pay in full
     the whole amount so due and unpaid upon such Securities, then to the
     payment of such principal and interest, without preference or priority of
     principal over interest, or of interest over principal, or of any
     installment of interest over any other installment of interest, or of any
     Security over any other Security, ratably to the aggregate of such unpaid
     principal and interest; and

                                       39
<PAGE>

          Fourth: To the payment of the remainder, if any, to the Company, its
          ------
     successors or assigns, or to whomsoever may be lawfully entitled to receive
     the same, or as a court of competent jurisdiction may direct.

     Section 6.04 Limitation On Suits By Holders of Securities. No holder of any
                  --------------------------------------------
Security of any series shall have any right by virtue or by availing of any
provision of this Indenture to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Indenture or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
such holder previously shall have given to the Trustee written notice of default
and of the continuance thereof, as herein before provided, and unless also the
holders of not less than 25% in principal amount of all the Securities at the
time outstanding (considered as one class) shall have made written request upon
the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after its receipt of
such notice, request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding and no direction inconsistent with
such written request shall have been given to the Trustee pursuant to SECTION
6.06; it being understood and intended, and being expressly covenanted by the
taker and holder of every Security with every other taker and holder and the
Trustee, that no one or more holders of Securities shall have any right in any
manner whatever by virtue or by availing of any provision of this Indenture to
affect, disturb or prejudice the rights of the holders of any other of such
Securities, or to obtain or seek to obtain priority over or preference to any
other such holder, or to enforce any right under this Indenture, except in the
manner herein provided and for the equal, ratable and common benefit of all
holders of Securities. For the protection and enforcement of the provisions of
this Section, each and every Securityholder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.

     Notwithstanding any other provisions in this Indenture, the right of any
holder of any Security to receive payment of the principal of and interest on
such Security, on or after the respective due dates expressed in such Security
(or, in the case of redemption on or after the date fixed for redemption), or to
institute suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
holder.

     Section 6.05 On Event of Default Trustee May Take Appropriate Action. If an
                  -------------------------------------------------------
Event of Default occurs and is continuing, the Trustee may in its discretion
proceed to protect and enforce its rights and the rights of the holders of the
Securities by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either by suit in
equity or by action at law or by proceeding in bankruptcy or otherwise, whether
for the specific enforcement of any covenant or agreement contained in this
Indenture or in aid of the exercise of any power granted in this Indenture, or
to enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law. All powers and remedies given by this Article to the
Trustee or to the Securityholders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any thereof or of any other powers and
remedies available to the Trustee or the holders of the Securities, by judicial
proceedings or otherwise, to enforce the performance or observance of the
covenants and agreements contained in this Indenture, and no delay or omission
of the Trustee, of any holder of any of the Securities or any holder of
Preferred Securities to exercise any right or power accruing upon any default
occurring and continuing as aforesaid shall impair any such right or power, or

                                       40
<PAGE>

shall be construed to be a waiver of any such default or an acquiescence
therein; and, subject to the provisions of SECTION 8.04, every power and remedy
given by this Article or by law to the Trustee, to the Securityholders or the
holders of Preferred Securities may be exercised from time to time, and as often
as shall be deemed expedient, by the Trustee, by the Securityholders or by the
holders of Preferred Securities, as the case may be.

     In the case of Securities of a series issued to a DPL Trust, any holder of
the corresponding series of Preferred Securities issued by such DPL Trust shall
have the right, upon the occurrence of an Event of Default described in SECTION
6.01(A) or (B) above, to institute a suit directly against the Company for
enforcement of payment to such holder of principal of (including premium, if
any) and interest (including any Additional Interest) on the Securities having a
principal amount equal to the aggregate liquidation amount of such Preferred
Securities of the corresponding series held by such holder.

     Section 6.06 Rights of Holders of Majority In Principal Amount of
                  ----------------------------------------------------
Securities to Direct Trustee and to Waive Default. The holders of at least a
-------------------------------------------------
majority in principal amount of the Securities of any one or more series or of
all the Securities, as the case may be (voting as one class), at the time
outstanding (determined as provided in SECTION 8.04) shall have the right to
direct the time, method, and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee under this Indenture with respect to such one or more series; provided,
however, that subject to SECTION 7.01, the Trustee shall have the right to
decline to follow any such direction if the Trustee being advised by Opinion of
Counsel determines that the action so directed may not lawfully be taken, or if
the Trustee in good faith shall, by a Responsible Officer or Officers of the
Trustee, determine that the proceedings so directed would be illegal or involve
it in personal liability or be unduly prejudicial to the rights of
Securityholders of such one or more series not parties to such direction, and
provided further, that nothing in this Indenture shall impair the right of the
Trustee to take any action deemed proper by the Trustee and which is not
inconsistent with such direction by such Securityholders of such one or more
series. The holders of at least a majority in principal amount of the Securities
of all series as to which an Event of Default hereunder has occurred (all series
voting as one class) at the time outstanding (determined as provided in SECTION
8.04) and, in the case of any Preferred Securities of a series issued to a DPL
Trust, the holders of at least a majority in aggregate liquidation amount of the
Preferred Securities issued by such DPL Trust, may waive any past default
hereunder with respect to such series and its consequences, except a default in
the payment of the principal of or interest on any of such Securities or
Preferred Securities or in respect of a covenant or provision hereof which under
Article X cannot be modified or amended without the consent of the holder of
each Security so affected. Upon any such waiver, such default shall cease to
exist and any Event of Default arising therefrom shall be deemed to have been
cured for every purpose of this Indenture, but no such waiver shall extend to
any subsequent or other default or impair any right consequent thereon. Any such
waiver shall be deemed to be on behalf of the holders of all the Securities of
such series or, in the case of a waiver by holders of Preferred Securities
issued by such DPL Trust, by all holders of Preferred Securities issued by such
DPL Trust.

     Section 6.07 Trustee to Give Notice of Defaults Known to It, But May
                  -------------------------------------------------------
Withhold In Certain Circumstances. The Trustee shall, within 90 days after the
---------------------------------
occurrence of any default hereunder with respect to the Securities of any

                                       41
<PAGE>

series, give to the holders of the Securities of such series in the manner and
to the extent provided in subsection (c) of SECTION 5.04 with respect to reports
pursuant to subsection (a) of said SECTION 5.04, notice of such default actually
known to the Trustee unless such default shall have been cured, remedied or
waived before the giving of such notice (the term "default" for the purposes of
this Section being hereby defined to be the events specified in clauses (c), (d)
and (e) of SECTION 6.01 and default in the payment of the principal of or
interest on Securities of any series, not including any periods of grace
provided for therein, and irrespective of the giving of written notice specified
in any such terms, and irrespective of the delivery of any Officers' Certificate
provided for in any such terms); provided, however, that, except in the case of
default in the payment of the principal of or interest on any of the Securities
of such series, the Trustee shall be protected in withholding such notice if and
so long as the Board of Directors, the Executive Committee, or a Trust Committee
of directors and/or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interest of the holders of the
Securities of such series.

     Section 6.08 Requirement of An Undertaking to Pay Costs In Certain Suits
                  -----------------------------------------------------------
Under The Indenture or Against The Trustee. All parties to this Indenture agree,
------------------------------------------
and each holder of any Security by his acceptance thereof shall be deemed to
have agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit, and
that such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees and expenses, against any party litigant in such
suit, having due regard to the merits and good faith of the claims or defenses
made by such party litigant; but the provisions of this Section shall not apply
to any suit instituted by the Trustee, to any suit instituted by any holder of
Securities of any series, or group of such Securityholders, holding in the
aggregate more than ten percent in principal amount of all the Securities (all
series considered as one class) outstanding, or to any suit instituted by any
Securityholder for the enforcement of the payment of the principal of or
interest on any Security, on or after the due date expressed in such Security
(or in the case of any redemption, on or after the date fixed for redemption).

                                   ARTICLE VII

                             CONCERNING THE TRUSTEE
                             ----------------------

     Section 7.01 Upon Event of Default Occurring and Continuing, Trustee Shall
                  -------------------------------------------------------------
Exercise Powers Vested In It, and Use Same Degree of Care and Skill In Their
----------------------------------------------------------------------------
Exercise, As A Prudent Man Would Use. Except during the continuance of an Event
------------------------------------
of Default with respect to any series of Securities:

          (1) the Trustee undertakes to perform such duties and only such duties
     as are specifically set forth in this Indenture with respect to the
     Securities of such series, and no implied covenants or obligations shall be
     read into this Indenture against the Trustee; and

          (2) in the absence of bad faith on its part, the Trustee may, with
     respect to the Securities of such series, conclusively rely as to the truth
     of the statements and the correctness of the opinions expressed therein,

                                       42
<PAGE>

     upon certificates or opinions furnished to the Trustee and conforming to
     the requirements of this Indenture; but in the case of any such
     certificates or opinions which by any provision hereof are specially
     required to be furnished by the Trustee, the Trustee shall be under a duty
     to examine the same to determine whether or not they conform to the
     requirements of this Indenture.

     In case an Event of Default with respect to any series of Securities has
occurred and is continuing, the Trustee shall exercise with respect to the
Securities of such series such rights and powers vested in it by this Indenture,
and use the same degree of care and skill in their exercise, as a prudent man
would exercise or use under the circumstances in the conduct of his own affairs.

     No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act,
or its own willful misconduct; provided, however, that

          (b) Prior to the occurrence of an Event of Default and after the
curing, remedying or waiving of all Events of Default which may have occurred:

          (1) The duties and obligations of the Trustee shall be determined
     solely by the express provisions of this Indenture and the Trustee shall
     not be liable except for the performance of such duties and obligations as
     are specifically set forth in this Indenture, and no implied covenants or
     obligations shall be read into this Indenture against the Trustee; and

          (2) In the absence of bad faith on the part of the Trustee, the
     Trustee may conclusively rely, as to the truth of the statements and the
     correctness of the opinions expressed therein, upon any certificates or
     opinions furnished to the Trustee and conforming to the requirements of
     this Indenture; but in the case of any such certificates or opinions which
     by any provision hereof are specifically required to be furnished to the
     Trustee, the Trustee shall be under a duty to examine the same to determine
     whether or not they conform to the requirements of this Indenture;

          (c) The Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Officers of the Trustee, unless it shall
be proved that the Trustee was negligent in ascertaining the pertinent facts
upon which such judgment was made;

          (d) The Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction of
the holders of Securities pursuant to SECTION 6.06 relating to the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee, under this
Indenture; and

          (e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that the
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it. Whether or not therein expressly so provided,

                                       43
<PAGE>

every provision of this Indenture relating to the conduct or affecting the
liability of or affording protection to the Trustee shall be subject to the
provisions of this SECTION 7.01.

     Section 7.02 Reliance On Documents, Opinions, Etc. Except as otherwise
                  ------------------------------------
provided in SECTION 7.01:

          (a) The Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
appraisal, bond, debenture, note, other evidence of indebtedness or other paper
or document believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties;

          (b) Any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by an Officers' Certificate (unless other
evidence in respect thereof be herein specifically prescribed); and any
Resolution of the Company may be evidenced to the Trustee by a copy thereof
certified by the Secretary or an Assistant Secretary of the Company;

          (c) The Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
to be taken by it hereunder in good faith and in reliance thereon;

          (d) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Securityholders pursuant to this Indenture, unless such
Securityholders shall have offered to the Trustee such adequate security or
indemnity against the costs, expenses (including attorneys' fees and expenses)
and liabilities that might be incurred by it in complying with such request or
direction;

          (e) The Trustee shall not be liable for any action taken or omitted to
be taken by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Indenture;

          (f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, approval, bond,
debenture, note, other evidence of indebtedness or other paper or document,
unless requested in writing to do so by the holders of Securities pursuant to
SECTION 6.06, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit; provided,
however, that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Indenture, the
Trustee may require adequate indemnity against such costs, expenses or
liabilities as a condition to so proceeding; and provided further, that nothing
in this subsection (f) shall require the Trustee to give the Securityholders any
notice other than that required by SECTION 6.07. The reasonable expense of every
such examination shall be paid by the Company or, if paid by the Trustee, shall
be repaid by the Company upon demand;

                                       44
<PAGE>

          (g) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;

          (h) The Trustee shall be under no responsibility for the approval by
it in good faith of any expert for any of the purposes expressed in this
Indenture;

          (i) The Trustee shall not be charged with knowledge of any default (as
defined in Section 6.07) or Event of Default with respect the Securities of any
series for which it is acting as Trustee unless either (i) a Responsible Officer
of the Trustee assigned to its Corporate Trust Department (or any successor
department or division of the Trustee) at the principal office of the Trustee
shall have actual knowledge of such default or Event of Default, as the case may
be, or (ii) written notice of such default or Event of Default, as the case may
be, shall have been received by the Trustee at the principal office of the
Trustee from the Company, or any other obligor on such Securities, or from any
Holder of such Securities, and such notice references the Securities and this
Indenture;

          (j) The rights, privileges, protections, immunities and benefits given
to the Trustee hereunder, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder and to each agent, custodian and other Person
employed to act hereunder; and

          (k) The Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of officers authorized at such time to take
specified actions pursuant to this Indenture, which Officers' Certificate may be
signed by any person authorized to sign an Officers' Certificate, including any
person specified as so authorized in any such certificate previously delivered
and not superseded.

     Section 7.03 Trustee Not Liable for Recitals In Indenture or In Securities.
                  --------------------------------------------------------------
The recitals contained herein and in the Securities (other than the certificate
of authentication on the Securities) shall be taken as the statements of the
Company, and the Trustee does not assume any responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture or of the Securities. The Trustee shall not be
accountable for the use or application by the Company of the proceeds of the
Securities of any series.

     Section 7.04 May Hold Securities. The Trustee or any agent of the Trustee
                  -------------------
or the Trust, in its individual or any other capacity, may become the owner or
pledgee of Securities and, subject to SECTION 7.08, with the same rights it
would have if it were not Trustee or such agent.

     Section 7.05 Moneys Received By Trustee to Be Held In Trust Without
                  ------------------------------------------------------
Interest. Subject to the provisions of SECTION 12.04, all moneys received by the
--------
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any moneys received by it hereunder.

                                       45
<PAGE>

     Section 7.06 Trustee Entitled to Compensation, Reimbursement and Indemnity.
                  --------------------------------------------------------------
The Company covenants and agrees to pay to the Trustee from time to time, and
the Trustee shall be entitled to, such compensation as shall be agreed to in
writing between the Company and the Trustee (which shall not be limited by any
provision of law in regard to the compensation of a trustee of any express
trust), and, the Company will pay or reimburse the Trustee upon its request for
all reasonable expenses, disbursements and advances incurred or made by the
Trustee in accordance with any provision of this Indenture or in connection with
the acceptance or administration of its trust under this Indenture (including
the reasonable compensation and the reasonable expenses and disbursements of its
agents and counsel and of all persons not regularly in its employ) except any
such expense, disbursement or advance as may arise from its negligence or
willful misconduct. The Company also covenants and agrees to indemnify each of
the Trustee, any predecessor Trustee and their agents for, and to hold them
harmless against, any loss, liability or expense incurred without negligence or
willful misconduct on their part and arising out of or in connection with the
acceptance or administration of this trust or performance of their duties
hereunder, including the costs and expenses (including reasonable fees and
disbursements of their counsel) of defending themselves against any claim
(whether asserted by the Company, any holder of Securities or any other Person)
or liability in connection with the exercise or performance of any of the powers
or duties hereunder. The obligations of the Company under this Section to
compensate the Trustee, to pay or reimburse the Trustee for expenses,
disbursements and advances and to indemnify and hold harmless the Trustee shall
constitute additional indebtedness hereunder. Such additional indebtedness shall
be secured by a lien prior to that of the Securities upon all property and funds
held or collected by the Trustee as such, except funds held in trust for the
payment of principal of or interest, if any, on particular Securities.

     In addition and without prejudice to the right provided to the Trustee
under any of the provisions of this Indenture, when the Trustee incurs expenses
or renders services in connection with an Event of Default specified in SECTION
6.01(D) or SECTION 6.01(E), the expenses (including the reasonable charges and
expenses of its counsel) and the compensation for the services are intended to
constitute expenses of administration under any applicable federal or state
bankruptcy, insolvency or other similar law.

     The obligations of the Company under this Section 7.06 and the lien
referred to in this Section 7.06 shall survive the termination of this
Indenture, the resignation or removal of the Trustee, the satisfaction or
discharge of this Indenture under Article XII and /or any defeasance or
discharge under Article XV. The claims of the Trustee under this Section 7.06
shall not be subject to the provisions of Article XIV.

     Section 7.07 Right of Trustee to Rely On Officers' Certificate Where No
                  ----------------------------------------------------------
Other Evidence Specifically Prescribed. Except as otherwise provided in SECTION
--------------------------------------
7.01, whenever in the administration of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking,
suffering or omitting to take any action hereunder, the Trustee (unless other
evidence in respect thereof be herein specifically prescribed) may, in the
absence of bad faith on its part, request and conclusively rely upon an
Officers' Certificate which, upon receipt of such request, shall be promptly
delivered by the Company.

                                       46
<PAGE>

     Section 7.08 Disqualification; Conflicting Interests. If the Trustee of any
                  ---------------------------------------
series has or shall acquire any conflicting interest, within the meaning of the
Trust Indenture Act, the Trustee shall either eliminate such interest or resign,
to the extent and in the manner provided by, and subject to the provisions of,
the Trust Indenture Act and this Indenture. In determining whether the Trustee
has a conflicting interest as defined in Section 310(b) of the Trust Indenture
Act with respect to the Securities of any particular series, there shall be
excluded (i) this Indenture with respect to Securities of any particular series
of Securities other than that series, (ii) each Guarantee Agreement and (iii)
each Trust Agreement. Nothing herein shall prevent the Trustee from filing with
the Commission the application referred to in the second to last paragraph of
Section 310(b) of the Trust Indenture Act.

     Section 7.09 Requirements for Eligibility of Trustee. The Trustee hereunder
                  ---------------------------------------
shall at all times be a corporation organized and doing business under the laws
of the United States or any State or territory thereof or of the District of
Columbia authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $50,000,000, subject to supervision or
examination by federal, state, territorial, or District of Columbia authority
and having its principal office and place of business in the City of Dayton or
in the Borough of Manhattan, The City of New York, if there be such a
corporation having its principal office and place of business in said places
willing to act upon reasonable and customary terms and conditions. If such
corporation publishes reports of condition at least annually, pursuant to law or
the requirements of the aforesaid supervising or examining authority, then, for
the purposes of this Section and to extent permitted by the Trust Indenture Act,
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, the Trustee shall resign
immediately in the manner and with the effect specified in SECTION 7.10. Neither
the Company, any other obligor upon the Securities, nor any person directly or
indirectly controlling, controlled by, or under common control with the Company
or any such obligor shall serve as Trustee under this Indenture.

     Section 7.10 Resignation and Removal of Trustee. (a) The Trustee, or any
                  ----------------------------------
trustee or trustees hereafter appointed, may at any time resign with respect to
one or more or all series of Securities by giving written notice of such
resignation to the Company and by giving to the holders of Securities of the
applicable series notice thereof in the manner and to the extent provided in
subsection (c) of SECTION 5.04 with respect to reports pursuant to subsection
(a) of SECTION 5.04. Upon receiving such notice of resignation and if the
Company shall deem it appropriate evidence satisfactory to it of such mailing,
the Company shall promptly appoint a successor Trustee with respect to the
applicable series (it being understood that any successor Trustee may be
appointed with respect to the Securities of one or more or all of such series
and at any time there shall be only one Trustee with respect to the Securities
of any particular series) by written instrument, in duplicate, executed pursuant
to a Resolution of the Company, one copy of which instrument shall be delivered
to the resigning Trustee and one copy to the successor Trustee. If no successor
Trustee shall have been so appointed with respect to any series and have
accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee, or any Securityholder
who has been a bona fide holder of a Security or Securities of the applicable
series for at least six months may, subject to the provisions of SECTION 6.08,

                                       47
<PAGE>

on behalf of himself and all others similarly situated, petition any such court
for the appointment of a successor Trustee. Such court may thereupon after such
notice, if any, as it may deem proper and prescribe, appoint a successor
Trustee.

          (b) In case at any time any of the following shall occur:

          (1) The Trustee shall fail to comply with SECTION 7.08 after written
     request therefor by the Company or by any Securityholder who has been a
     bona fide holder of a Security or Securities of the applicable series for
     at least six months, or

          (2) The Trustee shall cease to be eligible in accordance with the
     provisions of SECTION 7.09 and shall fail to resign after written request
     therefor by the Company or by any such Securityholder, or

          (3) The Trustee shall become incapable of acting, or shall be adjudged
     a bankrupt or insolvent, or a receiver of the Trustee or of its property
     shall be appointed, or any public officer shall take charge or control of
     the Trustee or of its property or affairs for the purpose of
     rehabilitation, conservation or liquidation,

then, in any such case, the Company may remove the Trustee with respect to the
applicable series and appoint a successor Trustee with respect to the applicable
series by written instrument, in duplicate, executed pursuant to a Resolution of
the Company, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor Trustee, or, subject to the provisions of
SECTION 6.08, any Securityholder who has been a bona fide holder of a Security
or Securities of the applicable series for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee with respect to the applicable series. Such court may thereupon, after
such notice, if any, as it may deem proper and prescribe, remove the Trustee and
appoint a successor Trustee.

          (c) The holders of a majority in principal amount of the Securities of
any one series voting as a separate class or all series voting as one class at
the time outstanding (determined as provided in SECTION 8.04) may at any time
remove the Trustee with respect to the applicable series or all series, as the
case may be, and appoint a successor Trustee with respect to the applicable
series or all series, as the case may be, by written instrument or instruments
signed by such holders or their attorneys-in-fact duly authorized, or by the
affidavits of the permanent chairman and permanent secretary of a meeting of the
Securityholders (as elected in accordance with SECTION 9.05) evidencing the vote
upon a resolution or resolutions submitted thereto with respect to such removal
and appointment (as provided in Article IX), and by delivery thereof to the
Trustee so removed, to the successor Trustee and to the Company.

          (d) Any resignation or removal of the Trustee and any appointment of a
successor Trustee pursuant to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor Trustee as provided in
SECTION 7.11.

     Section 7.11 Acceptance By Successor Trustee. Any successor Trustee with
                  -------------------------------
respect to all series of Securities appointed as provided in SECTION 7.10 shall
execute, acknowledge and deliver to the Company and to its predecessor Trustee
an instrument accepting such appointment hereunder, and thereupon the

                                       48
<PAGE>

resignation or removal of the predecessor Trustee with respect to all or any
applicable series shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties with respect to such series of its predecessor
hereunder, with like effect as if originally named as Trustee herein; but, on
the written request of the Company or of the successor Trustee, the Trustee
ceasing to act shall, upon payment of any amounts then due it pursuant to the
provisions of SECTION 7.06, execute and deliver an instrument transferring to
such successor Trustee all the rights and powers with respect to such series of
the Trustee so ceasing to act. Upon the request of any such successor Trustee,
the Company shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor Trustee all such rights
and powers. Any Trustee ceasing to act shall, nevertheless, retain a lien upon
all property or funds held or collected by such Trustee or any successor Trustee
to secure any amounts then due it pursuant to the provisions of SECTION 7.06.

     In case of the appointment hereunder of a successor Trustee with respect to
the Securities of one or more (but not all) series, the Company, the retiring
Trustee and each successor Trustee with respect to the Securities of such series
shall execute and deliver an indenture supplemental hereto wherein each
successor Trustee shall accept such appointment and which (1) shall contain such
provisions as shall be necessary or desirable to transfer and confirm to, and to
vest in, each successor Trustee all the rights, powers, trusts and duties of the
retiring Trustee with respect to the Securities of such series to which the
appointment of such successor Trustee relates, (2) if the retiring Trustee is
not retiring with respect to all Securities, shall contain such provisions as
shall be deemed necessary or desirable to confirm that all the rights, powers,
trusts and duties of the retiring Trustee with respect to the Securities of such
series as to which the retiring Trustee is not retiring shall continue to be
vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-Trustees of the same trust and that each such
Trustee shall be Trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of such series to which
the appointment of such successor Trustee relates; but, on written request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of such series to
which the appointment of such successor Trustee relates. Any Trustee ceasing to
act shall, nevertheless, retain a lien upon all property or funds held or
collected by such Trustee or any successor Trustee to secure any amounts then
due it pursuant to the provisions of SECTION 7.06.

     No successor Trustee shall accept appointment as provided in this Section
unless at the time of such acceptance such successor Trustee shall be qualified
under the provisions of SECTION 7.08 and eligible under the provisions of
SECTION 7.09.

                                       49
<PAGE>

     Upon acceptance of appointment by a successor Trustee as provided in this
Section, the successor Trustee shall at the expense of the Company transmit
notice of the succession of such Trustee hereunder to the holders of Securities
of any applicable series in the manner and to the extent provided in subsection
(c) of SECTION 5.04 with respect to reports pursuant to subsection (a) of said
SECTION 5.04.

     Section 7.12 Successor to Trustee By Merger, Consolidation or Succession to
                  --------------------------------------------------------------
Business. Any Person into which the Trustee may be merged or converted or with
--------
which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any Person
succeeding to all or substantially all of the corporate trust business of the
Trustee, shall be the successor of the Trustee hereunder, provided such Person
shall be qualified under the provisions of SECTION 7.08 and eligible under the
provisions of SECTION 7.09, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.

     In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee, and deliver such
Securities so authenticated; and in case at that time any of the Securities
shall not have been authenticated, any successor to the Trustee may authenticate
such Securities either in the name of any predecessor hereunder or in the name
of the successor Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have; provided, however, that the
right to adopt the certificate of authentication of any predecessor Trustee or
to authenticate Securities in the name of any predecessor Trustee shall apply
only to its successor or successors by merger, conversion or consolidation.

     Section 7.13 Limitations On Rights of Trustee As A Creditor to Obtain
                  --------------------------------------------------------
Payment of Certain Claims Within Three Months Prior to Default or During
------------------------------------------------------------------------
Default, or to Realize On Property As Such Creditor Thereafter. (a) Subject to
--------------------------------------------------------------
the provisions of subsection (b) of this Section, if the Trustee shall be or
shall become a creditor, directly or indirectly, secured or unsecured, of the
Company or of any other obligor on the Securities within three months prior to a
default, as defined in subsection (c) of this Section, or subsequent to such a
default, then, unless and until such default shall be cured, waived or remedied,
the Trustee shall set apart and hold in a special account for the benefit of the
Trustee individually, the holders of the Securities of the one or more other
indenture securities (as defined in subsection (c) of this Section):

          (1) An amount equal to any and all reductions in the amount due and
     owing upon any claim as such creditor in respect of principal or interest,
     effected after the beginning of such three-month period, and valid as
     against the Company and its other creditors, except any such reduction
     resulting from the receipt or disposition of any property described in
     paragraph (2) of this subsection, or from the exercise of any right of set-
     off which the Trustee could have exercised if a petition in bankruptcy had
     been filed by or against the Company upon the date of such default; and

          (2) All property received by the Trustee in respect of any claims as
     such creditor, either as security therefor, or in satisfaction or
     composition thereof, or otherwise, after the beginning of such three-month

                                       50
<PAGE>

     period, or an amount equal to the proceeds of any such property if disposed
     of, subject, however, to the rights, if any, of the Company and its other
     creditors in such property or such proceeds.

     Nothing herein contained, however, shall affect the right of the Trustee:

          (A) To retain for its own account (i) payments made on account of any
     such claim by any person (other than the Company) who is liable thereon,
     (ii) the proceeds of the bona fide sale of any such claim by the Trustee to
     a third person, and (iii) distributions made in cash, securities, or other
     property in respect of claims filed against the Company in bankruptcy or
     receivership or in proceedings for reorganization pursuant to title 11 of
     the United States Code or applicable state laws;

          (B) To realize, for its own account, upon any property held by it as
     security for any such claim, if such property was so held prior to the
     beginning of such three-month period;

          (C) To realize, for its own account, but only to the extent of the
     claim hereinafter mentioned, upon any property held by it as security for
     any such claim, if such claim was created after the beginning of such
     three-month period and such property was received as security therefor
     simultaneously with the creation thereof, and if the Trustee shall sustain
     the burden of proving that at the time such property was so received, the
     Trustee had no reasonable cause to believe that a default, as defined in
     subsection (c) of this Section, would occur within three months; or

          (D) To receive payment on any claim referred to in paragraph (B) or
     (C) against the release of any property held as security for such claim as
     provided in such paragraph (B) or (C), as the case may be, to the extent of
     the fair value of such property.

     For the purposes of paragraphs (B), (C), and (D), property substituted
after the beginning of such three-month period for property held as security at
the time of such substitution shall, to the extent of the fair value of the
property released, have the same status as the property released, and to the
extent that any claim referred to in any such paragraphs is created in renewal
of or in substitution for or for the purpose of repaying or refunding any pre-
existing claim of the Trustee as such creditor, such claim shall have the same
status as such pre-existing claim.

     If the Trustee shall be required to account, the funds and property held in
such special account and the proceeds thereof shall be apportioned between the
Trustee, the holders of Securities of the one or more series for which it is
acting as Trustee, and the holders of other indenture securities in such manner
that the Trustee, such Securityholders and the holders of other indenture
securities realize, as a result of payments from such special account and
payments of dividends on claims filed against the Company in bankruptcy or
receivership or in proceedings for reorganization pursuant to title 11 of the
United States Code or applicable state law, the same percentage of their
respective claims, figured before crediting to the claim of the Trustee anything

                                       51
<PAGE>

on account of the receipt by it from the Company of the funds and property in
such special account and before crediting to the respective claims of the
Trustee, such Securityholders, and the holders of other indenture securities
dividends on claims filed against the Company in bankruptcy or receivership or
in proceedings for reorganization pursuant to title 11 of the United States Code
or applicable state law, but after crediting thereon receipts on account of the
indebtedness represented by their respective claims from all sources other than
from such dividends and from the funds and property so held in such special
account. As used in this paragraph, with respect to any claim, the term
"dividends" shall include any distribution with respect to such claim in
bankruptcy or receivership or in proceedings for reorganization pursuant to
title 11 of the United States Code or applicable state law, whether such
distribution is made in cash, securities, or other property, but shall not
include any such distribution with respect to the secured portion, if any, of
such claim. The court in which such bankruptcy, receivership or proceeding for
reorganization is pending shall have jurisdiction (i) to apportion among the
Trustee, such Securityholders, and the holders of other indenture securities, in
accordance with the provisions of this paragraph, the funds and property held in
such special account and the proceeds thereof, or (ii) in lieu of such
apportionment, in whole or in part, to give to the provisions of this paragraph
due consideration in determining the fairness of the distributions to be made to
the Trustee, such Securityholders and the holders of other indenture securities
with respect to their respective claims, in which event it shall not be
necessary to liquidate or to appraise the value of any securities or other
property held in such special account or as security for any such claim, or to
make a specific allocation of such distributions as between the secured and
unsecured portions of such claim, or otherwise to apply the provisions of this
paragraph as a mathematical formula.

     Any Trustee who has resigned or been removed after the beginning of such
three-month period shall be subject to the provisions of this subsection (a) as
though such resignation or removal had not occurred. If any Trustee has resigned
or been removed prior to the beginning of such three-month period, it shall be
subject to the provisions of this subsection (a) if and only if the following
conditions exist:

          (i) The receipt of property or reduction of claim which would have
     given rise to the obligation to account, if such Trustee had continued as
     trustee, occurred after the beginning of such three-month period; and

          (ii) Such receipt of property or reduction of claim occurred within
     three months after such resignation or removal;

          (b) There shall be excluded from the operation of subsection (a) of
this Section a creditor relationship arising from:

          (1) The ownership or acquisition of securities issued under any
     indenture, or any security or securities having a maturity of one year or
     more at the time of acquisition by the Trustee;

          (2) Advances authorized by a receivership or bankruptcy court of
     competent jurisdiction, or by this Indenture, for the purpose of preserving
     any property which shall at any time be subject to the lien of this
     Indenture or of discharging tax liens or other prior liens or encumbrances

                                       52
<PAGE>

     thereon, if notice of such advances and of the circumstances surrounding
     the making thereof is given to the Securityholders at the time and in the
     manner provided in SECTION 5.04(C) with respect to reports pursuant to
     subsections (a) and (b) thereof, respectively;

          (3) Disbursements made in the ordinary course of business in the
     capacity of Trustee under an indenture, transfer agent, registrar,
     custodian, paying agent, fiscal agent or depositary, or other similar
     capacity;

          (4) An indebtedness created as a result of services rendered or
     premises rented; or an indebtedness created as a result of goods or
     securities sold in a cash transaction as defined in subsection (c) of this
     Section;

          (5) The ownership of stock or of other securities of a corporation
     organized under the provisions of Section 25(a) of the Federal Reserve Act,
     as amended, which is directly or indirectly a creditor of the Company; or

          (6) The acquisition, ownership, acceptance or negotiation of any
     drafts, bills of exchange, acceptances or obligations which fall within the
     classification of self-liquidating paper as defined in subsection (c) of
     this Section.

          (c) As used in this Section:

          (1) The term "default" shall mean any failure to make payment in full
     of the principal of or interest upon any of the Securities or upon the
     other indenture securities when and as such principal or interest becomes
     due and payable.

          (2) The term "other indenture securities" shall mean securities upon
     which the Company is an obligor (as defined in the Trust Indenture Act of
     1939) outstanding under any other indenture (A) under which the Trustee is
     also trustee, (B) which contains provisions substantially similar to the
     provisions of subsection (a) of this Section, and (C) under which a default
     exists at the time of the apportionment of the funds and property held in
     said special account.

          (3) The term "cash transaction" shall mean any transaction in which
     full payment for goods or securities sold is made within seven days after
     delivery of the goods or securities in currency or in checks or other
     orders drawn upon banks or bankers and payable upon demand.

          (4) The term "self-liquidating paper" shall mean any draft, bill of
     exchange, acceptance or obligation which is made, drawn, negotiated or
     incurred by the Company for the purpose of financing the purchase,
     processing, manufacture, shipment, storage or sale of goods, wares or
     merchandise and which is secured by documents evidencing title to,
     possession of, or a lien upon, the goods, wares or merchandise, or the
     receivables or proceeds arising from the sale of the goods, wares or
     merchandise previously constituting the security; provided the security is
     received by the Trustee simultaneously with the creation of the creditor

                                       53
<PAGE>

     relationship with the Company arising from the making, drawing, negotiating
     or incurring of the draft, bill of exchange, acceptance or obligation.

          (5) The term "Company" shall mean any obligor upon the Securities.

                                  ARTICLE VIII

                         CONCERNING THE SECURITYHOLDERS
                         ------------------------------

     Section 8.01 Evidence of Action By Securityholders. Whenever in this
                  -------------------------------------
Indenture it is provided that the holders of a specified percentage in principal
amount of the Securities of any or all series may take any action (including the
making of any demand or request, the giving of any notice, consent, or waiver or
the taking of any other action), the fact at the time of taking any such action
the holders of such specified percentage have joined therein may be evidenced
(a) by any instrument or any number of instruments of similar tenor executed by
such Securityholders in person or by agent or proxy appointed in writing, or (b)
by the record of such holders of Securities voting in favor thereof at any
meeting of such Securityholders duly called and held in accordance with the
provisions of Article IX, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of such Securityholders.

     If there shall be more than one Trustee acting hereunder with respect to
separate series of Securities, such Trustees shall collaborate, if necessary, in
acting under Article IX and in determining whether the holders of a specified
percentage in principal amount of the Securities of any or all series have taken
any such action.

     Section 8.02 Proof of Execution of Instruments and of Holding of
                  ---------------------------------------------------
Securities. Subject to the provisions of SECTIONS 7.01, 7.02 and 9.05, proof of
----------
the execution of any instrument by a Securityholder or his agent or proxy and
proof of the holding by any person of any of the Securities shall be sufficient
if made in the following manner:

     The fact and date of the execution by any such person of any instrument may
be proved in any reasonable manner acceptable to the Trustee.

     The ownership of Securities of any series shall be proved by the Register
of such Securities of such series, or by certificates of the Security registrar
or registrars thereof.

     The Trustee shall not be bound to recognize any person as a Securityholder
unless and until title to the Securities held by him is proved in the manner in
this Article VIII provided.

     The record of any Securityholders' meeting shall be proved in the manner
provided in SECTION 9.06.

     The Trustee may accept such other proof or require such additional proof of
any matter referred to in this Section as it shall deem reasonable.

     Section 8.03 Who May Be Deemed Owners of Securities. Prior to due
                  --------------------------------------
presentment for registration of transfer of any Security, the Company, the
Trustee and any agent of the Company or the Trustee may deem and treat the

                                       54
<PAGE>

person in whose name such Security shall be registered upon the Register of
Securities of the series of which such Security is a part as the absolute owner
of such Security (whether or not payments in respect of such Security shall be
overdue and notwithstanding any notation of ownership or other writing thereon)
for the purpose of receiving payment of or an account of the principal of and
interest, subject to SECTION 2.03, on such Security and for all other purposes;
and neither the Company nor the Trustee nor any agent of the Company or the
Trustee shall be affected by any notice to the contrary. All such payments so
made to any such holder for the time being, or upon his order, shall be valid,
and, to the extent of the sum or sums so paid, effectual to satisfy and
discharge the liability of moneys payable upon any such Security.

     Section 8.04 Securities Owned By Company or Controlled or Controlling
                  --------------------------------------------------------
Persons Disregarded for Certain Purposes. In determining whether the holders of
----------------------------------------
the requisite principal amount of Securities have concurred in any demand,
direction, request, notice, vote, consent, waiver or other action under this
Indenture, Securities which are owned by the Company or any other obligor on the
Securities or by any person directly or indirectly controlling or controlled by
or under direct or indirect common control with the Company or any other obligor
on the Securities shall be disregarded and deemed not to be outstanding for the
purpose of any such determination; provided that for the purposes of determining
whether the Trustee shall be fully protected in relying on any such demand,
direction, request, notice, vote, consent, waiver or other action, only
Securities which a Responsible Officer of the Trustee assigned to its principal
office actually knows are so owned shall be so disregarded. Securities so owned
which have been pledged in good faith may be regarded as outstanding for the
purposes of this Section, if the pledgee shall establish to the satisfaction of
the Trustee the pledgee's right to vote such Securities and that the pledgee is
not a person directly or indirectly controlling or controlled by or under direct
or indirect common control with the Company or any such other obligor. Upon
request of the Trustee, the Company shall furnish to the Trustee promptly an
Officers' Certificate listing and identifying all Securities, if any, known by
the Company to be owned or held by or for the account of the Company or any
other obligor on the Securities or by any person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Company or any other obligor on the Securities; and, subject to the provisions
of SECTION 7.01, the Trustee shall be entitled to accept such Officers'
Certificate as conclusive evidence of the facts therein set forth and of the
fact that all Securities not listed therein are outstanding for the purpose of
any such determination.

     Section 8.05 Instruments Executed By Securityholders Bind Future Holders.
                  -----------------------------------------------------------
At any time prior to (but not after) the evidencing to the Trustee, as provided
in SECTION 8.01, of the taking of any action by the holders of the percentage in
principal amount of the Securities specified in this Indenture in connection
with such action, any holder of a Security which is shown by the evidence to be
included in the Securities the holders of which have consented to such action
may, by filing written notice with the Trustee at its principal office and upon
proof of holding as provided in SECTION 8.02, revoke such action so far as
concerns such Security. Except as aforesaid any such action taken by the holder
of any Security and any direction, demand, request, notice, waiver, consent,
vote or other action of the holder of any Security which by any provisions of
this Indenture is required or permitted to be given shall be conclusive and
binding upon such holder and upon all future holders and owners of such
Security, and of any Security issued in lieu thereof or upon registration of
transfers thereof, irrespective of whether any notation in regard thereto is

                                       55
<PAGE>

made upon such Security. Any action taken by the holders of the percentage in
principal amount of the Securities of any or all series specified in this
Indenture in connection with such action shall be conclusively binding upon the
Company, the Trustee and the holders of all of the Securities of such series
subject, however, to the provisions of SECTION 7.01.

                                   ARTICLE IX

                           SECURITYHOLDERS' MEETINGS
                           -------------------------

     Section 9.01 Purposes for Which Meetings May Be Called. A meeting of
                  -----------------------------------------
holders of Securities of any or all series may be called at any time and from
time to time pursuant to the provisions of this Article for any of the following
purposes:

          (1) To give any notice to the Company or to the Trustee, or to give
     any directions to the Trustee, or to consent to the waiving of any default
     hereunder and its consequences, or to take any other action authorized to
     be taken by holders of Securities of any or all series, as the case may be,
     pursuant to any of the provisions of Article VI;

          (2) To remove the Trustee and appoint a successor Trustee pursuant to
     the provisions of Article VII;

          (3) To consent to the execution of an indenture or indentures
     supplemental hereto pursuant to the provisions of SECTION 10.02; or

          (4) To take any other action authorized to be taken by or on behalf of
     the holders of any specified principal amount of the Securities of any or
     all series, as the case may be, under any other provision of this Indenture
     or under applicable law.

     Section 9.02 Manner of Calling Meetings. The Trustee may at any time call a
                  --------------------------
meeting of Securityholders to take any action specified in SECTION 9.01, to be
held at such time and at such place in the Borough of Manhattan, State of New
York, as the Trustee shall determine. Notice of every meeting of Securityholders
setting forth the time and place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be mailed not less than 20 nor more
than 60 days prior to the date fixed for the meeting.

     Section 9.03 Call of Meeting By Company or Securityholders. In case at any
                  ---------------------------------------------
time the Company, pursuant to a resolution of its Board of Directors, or the
holders of not less than ten percent in principal amount of the Securities of
any or all series, as the case may be, then outstanding, shall have requested
the Trustee to call a meeting of holders of Securities of any or all series, as
the case may be, to take any action authorized in SECTION 9.01 by written
request setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have mailed notice of such meeting within
20 days after receipt of such request, then the Company or such holders of
Securities in the amount above specified may determine the time and place in the
Borough of Manhattan, State of New York for such meeting and may call such
meeting to take any action authorized in SECTION 9.01, by mailing notice thereof
as provided in SECTION 9.02.

                                       56
<PAGE>

     Section 9.04 Who May Attend and Vote At Meetings. To be entitled to vote at
                  -----------------------------------
any meeting of Securityholders a person shall (a) be a holder of one or more
Securities with respect to which the meeting is being held, or (b) be a person
appointed by an instrument in writing as proxy by such holder of one or more
Securities. The only persons who shall be entitled to be present or to speak at
any meeting of Securityholders shall be the persons entitled to vote at such
meeting and their counsel and any representatives of the Trustee and its counsel
and any representatives of the Company and its counsel.

     Section 9.05 Regulations May Be Made By Trustee. Notwithstanding any other
                  ----------------------------------
provisions of this Indenture, the Trustee may make such reasonable regulations
as it may deem advisable for any meeting of Securityholders, in regard to proof
of the holding of Securities and of the appointment of proxies, and in regard to
the appointment and duties of inspectors of votes, the submission and
examination of proxies, certificates and other evidence of the right to vote,
and such other matters concerning the conduct of the meeting as it shall think
fit. Except as otherwise permitted or required by any such regulations, the
holding of Securities shall be proved in the manner specified in SECTION 8.02
and the appointment of any proxy shall be proved in the manner specified in said
SECTION 8.02; provided, however, that such regulations may provide that written
instruments appointing proxies regular on their face, may be presumed valid and
genuine without the proof hereinabove or in said SECTION 8.02 specified.

     The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in SECTION 9.03, in which case the
Company or the Securityholders calling the meeting, as the case may be, shall in
like manner appoint a temporary chairman. A permanent chairman and a permanent
secretary of the meeting shall be elected by majority vote of the meeting.

     Subject to the provisions of SECTION 8.04, at any meeting each
Securityholder or proxy shall be entitled to one vote for each $1,000 principal
amount of Securities held or represented by him, provided, however, that no vote
shall be cast or counted at any meeting in respect of any Security challenged as
not outstanding and ruled by the permanent chairman of the meeting to be not
outstanding; provided, further, that each holder of Original Issue Discount
Securities shall be entitled to one vote for each $1,000 amount which would be
due upon acceleration of his Original Issue Discount Security on the date of the
meeting. Neither a temporary nor a permanent chairman of the meeting shall have
a right to vote other than by virtue of Securities held by him or instruments in
writing as aforesaid duly designating him as the person to vote on behalf of
other Securityholders. Any meeting of Securityholders duly called pursuant to
the provisions of SECTION 9.02 or 9.03 may be adjourned from time to time, and
the meeting may be held so adjourned without further notice.

     At any meeting of Securityholders, the presence of persons holding or
representing Securities in principal amount sufficient to take action on the
business for the transaction of which such meeting was called shall constitute a
quorum, but, if less than a quorum is present, the person or persons holding or
representing a majority in principal amount of the Securities represented at the
meeting may adjourn such meeting with the same effect for all intents and
purposes, as though a quorum had been present.

                                       57
<PAGE>

     Section 9.06 Manner of Voting At Meetings and Record to Be Kept. The vote
                  --------------------------------------------------
upon any resolution submitted to any meeting of Securityholders shall be by
written ballots on which shall be subscribed the signatures of the holders of
Securities or of their representatives by proxy and the principal amount or
principal amounts of the Securities held or represented by them. The permanent
chairman of the meeting shall appoint two inspectors of votes who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the permanent secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record in duplicate of
the proceedings of each meeting of Securityholders shall be prepared by the
permanent secretary of the meeting and there shall be attached to said record
the original reports of the inspectors of votes on any vote by ballot taken
thereat and affidavits by one or more persons having knowledge of the facts
setting forth a copy of the notice of the meeting and showing that said notice
was mailed as provided in SECTION 9.02. The record shall show the principal
amount or principal amounts of the Securities voting in favor of, against, or
abstaining from voting on, any resolution. The record shall be signed and
verified by the affidavits of the permanent chairman and permanent secretary of
the meeting and one of the duplicates shall be delivered to the Company and the
other to the Trustee to be preserved by the Trustee.

     Any record so signed and verified shall be conclusive evidence of the
matters therein stated.

     Section 9.07 Exercise of Rights of Trustee, Securityholders and Holders of
                  -------------------------------------------------------------
Preferred Securities Not to Be Hindered or Delayed. Nothing in this Article
--------------------------------------------------
contained shall be deemed or construed to authorize or permit, by reason of any
call of a meeting of Securityholders or any rights expressly or impliedly
conferred hereunder to make such call any hindrance or delay in the exercise of
any right or rights conferred upon or reserved to the Trustee, to the
Securityholders or the holders of Preferred Securities under any of the
provisions of this Indenture or of the Securities.

                                    ARTICLE X

                            SUPPLEMENTAL INDENTURES
                            -----------------------

     Section 10.01 Purposes for Which Supplemental Indentures May Be Entered
                   ---------------------------------------------------------
Into Without Consent of Securityholders. The Company, when authorized by a
---------------------------------------
Resolution of the Company, and the Trustee may from time to time, and at any
time enter into an indenture or indentures supplemental hereto, in form
satisfactory to such Trustee (which shall comply with the provisions of the
Trust Indenture Act of 1939 as then in effect), for one or more of the following
purposes:

          (a) To evidence the succession of another corporation to the Company,
or successive successions, and the assumption by the successor corporation of
the covenants, agreements and obligations of the Company pursuant to Article XI
hereof , provided, however, that as a condition to entering into any such
supplemental indenture or indentures for any of the foregoing purposes, the
Company shall have delivered to the Trustee an Opinion of Counsel to the effect
that the holders of the Securities of all series then outstanding will not
recognize income, gain or loss for United States federal income tax purposes as
a result of the Company and the Trustee entering into such supplemental

                                       58
<PAGE>

indenture or indentures, and that such holders will be subject to United States
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if the Company and the Trustee had not entered into
such supplemental indenture or indentures;

          (b) To add to the covenants of the Company such further covenants,
restrictions or conditions as the Company and the Trustee shall consider to be
for the protection of the holders of all or any series of Securities (and if
such covenants, restrictions or conditions are to be for the benefit of less
than all series of Securities, stating that such covenants, restrictions or
conditions are expressly being included solely for the benefit of such series),
and to make the occurrence, or the occurrence and continuance, of a default in
any such additional covenants, restrictions or conditions a default or an Event
of Default permitting the enforcement of all or any of the several remedies
provided in this Indenture as herein set forth; provided, however, that in
respect to any such additional covenant, restriction or condition such
supplemental indenture may provide for a particular period of grace after
default (which period may be shorter or longer than that allowed in the case of
other defaults) or may provide for an immediate enforcement upon such default or
may limit the remedies available to the Trustee upon such default;

          (c) To add or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Securities
in bearer form, registrable or not registrable as to principal, and with or
without interest coupons;

          (d) To change or eliminate any of the provisions of this Indenture;
provided, however, that any such change or elimination shall become effective
only when there is no Security of any series outstanding created prior to the
execution of such supplemental indenture which is entitled to the benefit of
such provision;

          (e) To establish the form or terms of Securities of any series as
permitted by SECTION 2.01 and 2.02;

          (f) To cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provisions contained herein or in any supplemental
indenture, or to make such other provision in regard to matters or questions
arising under this Indenture or any supplemental indenture; provided, however,
that such action shall not adversely affect the interests of the holders of
Securities of any series in any material respect or, in the case of the
Securities of a series issued to a DPL Trust and for so long as any of the
corresponding series of Preferred Securities issued by such DPL Trust shall
remain outstanding, the holders of such Preferred Securities;

          (g) To mortgage or pledge to the Trustee as security for the
Securities any property or assets which the Company may desire to mortgage or
pledge as security for the Securities; and

          (h) To qualify, or maintain the qualification of, the Indenture under
the Trust Indenture Act.

     The Trustee is hereby authorized to join with the Company in the execution
of any such supplemental indenture, to make any further appropriate agreements
and stipulations which may be therein contained and to accept the conveyance,

                                       59
<PAGE>

transfer, mortgage, pledge or assignment of any property thereunder, but the
Trustee shall not be obligated to enter into any such supplemental indenture
which affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.

     Any supplemental indenture authorized by the provisions of this Section may
be executed by the Company and the Trustee without the consent of the holders of
any of the Securities at the time outstanding, notwithstanding any of the
provisions of SECTION 10.02.

     Section 10.02 Modification of Indenture With Consent of Holders of A
                   ------------------------------------------------------
Majority In Principal Amount of Securities. With the consent (evidenced as
------------------------------------------
provided in SECTION 8.01) of the holders of not less than a majority in
principal amount of the Securities of all series at the time outstanding
(determined as provided in SECTION 8.04) affected by such supplemental indenture
(voting as one class), the Company, when authorized by a Resolution of the
Company, and the Trustee may from time to time and at any time enter into an
indenture or indentures supplemental hereto (which shall be in conformity with
the provisions of the Trust Indenture Act of 1939 as then in effect) for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Indenture or of any supplemental indenture or of
modifying in any manner the rights of the holders of the Securities of each such
series; provided, however, that no such supplemental indenture shall (i) change
the fixed Maturity of any Securities, or reduce the rate or extend the time of
payment of any interest thereon or on any overdue principal amount or reduce the
principal amount thereof, or change the provisions pursuant to which the rate of
interest on any Security is determined if such change could reduce the rate of
interest thereon, or reduce the minimum rate of interest thereon, or reduce any
amount payable upon any redemption thereof, or adversely affect any right to
convert the Securities in accordance herewith, or reduce the amount to be paid
at Maturity or upon redemption in Capital Stock or make the principal thereof or
any interest thereon or on any overdue principal amount payable in any coin or
currency other than that provided in the Security without the consent of the
holder of each Security so affected, (ii) reduce the aforesaid percentage of
Securities, the holders of which are required to consent to any such
supplemental indenture without the consent of the holders of all Securities then
outstanding, (iii) modify any of the provisions of this Section, SECTION 4.07 or
SECTION 6.06, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the holders of all Securities then outstanding or (iv) modify the
provisions of Article XIV with respect to the subordination of outstanding
Securities of any series in a manner adverse to the holders thereof without the
consent of the holder of each Security so affected; provided, however, that, in
the case of the Securities of a series issued to a DPL Trust, so long as any of
the corresponding series of Preferred Securities issued by such DPL Trust
remains outstanding, (i) no such amendment shall be made that adversely affects
the holders of such Preferred Securities in any material respect, and no
termination of this Indenture shall occur, and no waiver of any Event of Default
with respect to such series or compliance with any covenant with respect to such
series under this Indenture shall be effective, without the prior consent of the
holders of at least a majority of the aggregate liquidation amount of such
Preferred Securities then outstanding unless and until the principal (and
premium, if any) of the Securities of such series and all accrued and unpaid
interest (including any Additional Interest) thereon have been paid in full; and
(ii) no amendment shall be made to SECTION 6.05 of this Indenture that would
impair the rights of the holders of such Preferred Securities provided therein
or to this Indenture that requires the consent of each holder of the Securities

                                       60
<PAGE>

of such series without the prior consent of each holder of such Preferred
Securities then outstanding unless and until the principal (and premium, if any)
of the Securities of such series and all accrued and unpaid interest (including
any Additional Interest) thereon have been paid in full.

     A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities or Preferred Securities,
or which modifies the rights of holders of Securities or holders of Preferred
Securities of such series with respect to such covenant or other provision,
shall be deemed not to affect the rights under this Indenture of the holders of
Securities or holders of Preferred Securities of any other series.

     Upon the request of the Company, accompanied by a copy of a Resolution of
the Company certified by the Secretary or an Assistant Secretary of the Company
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.

     It shall not be necessary for the consent of the Securityholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such consent shall approve the substance thereof.

     Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Company
shall mail a notice to the holders of Securities of each series so affected,
setting forth in general terms the substance of such supplemental indenture. Any
failure of the Company to mail such notice, or any defect therein, shall not,
however, in any way impair or affect the validity of any such supplemental
indenture.

     Section 10.03 Effect of Supplemental Indentures. Upon the execution of any
                   ---------------------------------
supplemental indenture pursuant to the provisions of this Article, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the holders
of Securities shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments, and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.

     The Trustee shall be entitled to receive, and subject to the provisions of
SECTION 7.01 shall be entitled to rely upon, an Opinion of Counsel as conclusive
evidence that any such supplemental indenture complies with the provisions of
this Article and stating that the Securities affected by the supplemental
indenture, when such Securities are authenticated and delivered by the Trustee
and executed and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
binding obligations of the Company, enforceable against the Company in

                                       61
<PAGE>

accordance with their terms, except as may be limited by applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization or other similar laws
affecting creditors' rights and by general equitable principles (whether
considered in a proceeding in equity or at law).

     Section 10.04 Securities May Bear Notation of Changes By Supplemental
                   -------------------------------------------------------
Indentures. Securities authenticated and delivered after the execution of any
----------
supplemental indenture pursuant to the provisions of this Article, or after any
action taken at a Securityholders' meeting pursuant to Article IX, may bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture or as to any action taken at any such meeting. If the
Company or the Trustee shall so determine, new Securities so modified as to
conform, in the opinion of the Trustee and the Board of Directors of the
Company, to any modification of this Indenture contained in any such
supplemental indenture may be prepared by the Company, authenticated by the
Trustee and delivered in exchange for the Securities then outstanding.

     Section 10.05 Revocation and Effect of Consents. Subject to SECTION 8.05,
                   ---------------------------------
until an amendment, supplement, waiver or other action becomes effective, a
consent to it by a Securityholder of a Security is a continuing consent
conclusive and binding upon such Securityholder and every subsequent
Securityholder of the same Security or portion thereof, and of any Security
issued upon the registration of transfer thereof or in exchange therefor or in
place thereof, even if notation of the consent is not made on any such Security.

     The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Securityholders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then, notwithstanding the
preceding paragraph, those Persons who were Securityholders at such record date
(or their duly designated proxies), and only such Persons, shall be entitled to
consent or revoke such consent to such amendment, supplement or waiver, whether
or not such Persons continue to be Securityholders after such record date. No
such consent shall be valid or effective for more than 180 days after such
record date.

     After an amendment, supplement, waiver or other action becomes effective,
it shall bind every Securityholder.

                                   ARTICLE XI

                    CONSOLIDATION, MERGER, SALE OR CONVEYANCE
                    -----------------------------------------

     Section 11.01 Company May Consolidate, Etc. On Certain Terms. The Company
                   ----------------------------
covenants that it will not merge or consolidate with any other corporation or
sell or convey all or substantially all of its assets to any Person unless (i)
either the Company shall be the continuing corporation, or the successor
corporation (if other than the Company) shall be a corporation organized and
existing under the laws of the United States of America or a State thereof or
the District of Columbia and such corporation shall expressly assume the due and
punctual payment of the principal of and interest on all the Securities,
according to their tenor, and the due and punctual performance and observance of
all of the covenants and conditions of this Indenture to be performed by the
Company by supplemental indenture satisfactory to the Trustee, executed and
delivered to the Trustee by such corporation, (ii) the Company or such successor

                                       62
<PAGE>

corporation, as the case may be, shall not, immediately after such merger or
consolidation, or such sale or conveyance, be in default in the performance of
any such covenant or condition, (iii) in the case of Securities of a series
issued to a DPL Trust, such consolidation, merger, sale or conveyance is
permitted under the relevant Trust Agreement and DPL Guarantee and does not give
rise to any breach or violation of such Trust Agreement or DPL Guarantee , and
(iv) the Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the holders of all Securities will not recognize income, gain or
loss for United States federal income tax purposes as a result of such merger,
consolidation, sale or conveyance, and that such holders will be subject to
United States federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such merger, consolidation, sale
or conveyance had not occurred.

     Section 11.02 Successor Corporation Substituted. In case of any such
                   ---------------------------------
consolidation, merger, sale or conveyance and upon any such assumption by the
successor corporation, such successor corporation shall succeed to and be
substituted for the Company, with the same effect as if it had been named herein
as the party of the first part. Such successor corporation thereupon may cause
to be signed, and may issue either in its own name or in the name of the
Company, any or all of the Securities issuable hereunder which theretofore shall
not have been delivered to the Trustee; and upon the order of such successor
corporation, instead of the Company, and subject to all the terms, conditions
and limitations in this Indenture prescribed, the Trustee shall authenticate and
shall deliver any Securities which previously shall have been signed and
delivered by the officers of the Company to the Trustee, and any Securities
which such successor corporation thereafter shall cause to be signed and
delivered to the Trustee. All the Securities so issued shall in all respects
have the same legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of this Indenture
as though all of such Securities had been issued at the date of the execution
hereof.

     In case of any such consolidation, merger, sale or conveyance such changes
in phraseology and form (but not in substance) may be made in the Securities
thereafter to be issued as may be appropriate.

     Section 11.03 Opinion of Counsel to Trustee. The Trustee shall be entitled
                   -----------------------------
to receive, and subject to the provisions of SECTION 7.01 shall be entitled to
rely upon, an Opinion of Counsel as conclusive evidence that any such
consolidation, merger, sale or conveyance and any such assumption, complies with
the provisions of this Article and that all conditions precedent herein provided
for relating to such transaction have been complied with.

                                   ARTICLE XII

                    SATISFACTION AND DISCHARGE OF INDENTURE,
                    ----------------------------------------
                                UNCLAIMED MONEYS
                                ----------------

     Section 12.01 Satisfaction and Discharge of Indenture. If (a) the Company
                   ---------------------------------------
shall deliver to the Trustee for cancellation all Securities of any series
theretofore authenticated (other than any Securities of such series which shall
have been destroyed, lost or stolen and which shall have been replaced or paid
as provided in SECTION 2.07) and not theretofore cancelled, or (b) all the
Securities of such series not theretofore cancelled or delivered to the Trustee

                                       63
<PAGE>

for cancellation shall have become due and payable, or are by their terms to
become due and payable within one year or are to be called for redemption within
one year under arrangements satisfactory to the Trustee for the giving of notice
of redemption, and the Company shall deposit with the Trustee as trust funds the
entire amount sufficient to pay at Maturity or upon redemption all of such
Securities not theretofore cancelled or delivered to the Trustee for
cancellation, including principal and any interest due or to become due to such
date of Maturity or redemption date, as the case may be, and if in either case
the Company shall also pay or cause to be paid all other sums payable hereunder
by the Company with respect to Securities of such series, then this Indenture
shall cease to be of further effect with respect to Securities of such series,
(except as to (i) remaining rights of registration of transfer, conversion,
substitution and exchange and the Company's right of optional redemption of
Securities of such series, (ii) rights hereunder of holders to receive payments
of principal of, and any interest on, the Securities of such series, and other
rights, duties and obligations of the holders of Securities of such series as
beneficiaries hereof with respect to the amounts, if any, so deposited with the
Trustee, and (iii) the rights, obligations and immunities of the Trustee
hereunder), and the Trustee, on demand of the Company, and at the cost and
expense of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture. The Company hereby agrees to
compensate the Trustee for any services thereafter reasonably and properly
rendered and to reimburse the Trustee for any costs or expenses theretofore and
thereafter reasonably and properly incurred by the Trustee in connection with
this Indenture or the Securities of such series.

     Notwithstanding the satisfaction and discharge of this Indenture with
respect to the Securities of any or all series, the obligations of the Company
to the Trustee under SECTION 7.06 and of the Company under SECTION 12.02 AND
SECTION 15.06 shall survive.

     Section 12.02 Application By Trustee of Funds Deposited for Payment of
                   --------------------------------------------------------
Securities. Subject to SECTION 12.04 and SECTION 15.06, all moneys deposited
----------
with the Trustee pursuant to SECTION 12.01 shall be held in trust and applied by
it to the payment, either directly or through any Paying Agent (including the
Company acting as its own Paying Agent), to the holders of the particular
Securities of such series, for the payment or redemption of which such moneys
have been deposited with the Trustee, of all sums due and to become due thereon
for principal and interest.

     Section 12.03 Repayment of Moneys Held By Paying Agent. In connection with
                   ----------------------------------------
the satisfaction and discharge of this Indenture with respect to Securities of
any series, all moneys with respect to Securities of such series then held by
any Paying Agent under the provisions of this Indenture shall, upon demand of
the Company, be paid to the Trustee and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.

     Section 12.04 Repayment of Moneys Held By Trustee. Any moneys deposited
                   -----------------------------------
with the Trustee or any Paying Agent for the payment of the principal of or any
interest on any Securities of any series and not applied but remaining unclaimed
by the holders of Securities of such series for two years after the date upon
which such payment shall have become due and payable, shall, at the request of
the Company, be repaid to the Company by the Trustee or by such Paying Agent;
and the holder of any of the Securities of such series entitled to receive such
payment shall thereafter look only to the Company for the payment thereof;
provided, however, that the Trustee or such Paying Agent, before being required

                                       64
<PAGE>

to make any such repayment, shall, upon receipt of a written request of the
Company and at the expense of the Company cause to be published once a week for
two successive weeks (in each case on any day of the week) in an Authorized
Newspaper, or mailed to the registered holders thereof, a notice that said
moneys have not been so applied and that after a date named therein any
unclaimed balance of said money then remaining will be returned to the Company.

                                  ARTICLE XIII

               IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS,
               --------------------------------------------------
                            DIRECTORS AND EMPLOYEES
                            -----------------------

     Section 13.01 Incorporators, Stockholders, Officers, Directors and
                   ----------------------------------------------------
Employees of Company Exempt From Individual Liability. No recourse under or upon
-----------------------------------------------------
any obligation, covenant or agreement of this Indenture, or of any Security, or
for any claim based thereon or otherwise in respect thereof, shall be had
against any incorporator, stockholder, officer, director or employee, as such,
past, present or future, of the Company or of any successor corporation, either
directly or through the Company, whether by virtue of any constitution, statute
or rule of law, or by the enforcement of any assessment or penalty or otherwise,
it being expressly understood that this Indenture and the obligations issued
hereunder are solely corporate obligations, and that no personal liability
whatever shall attach to, or is or shall be incurred by, the incorporators,
stockholders, officers, directors or employees, as such, of the Company or any
successor corporation, or any of them, because of the creation of the
indebtedness hereby authorized, or under or by reason of the obligations,
covenants or agreements contained in this Indenture or in any of the Securities
or implied therefrom; and that any and all such personal liability of every name
and nature, either at common law or in equity or by constitution or statute, of,
and any and all such rights and claims against every such incorporator,
stockholder, officer, director or employee, as such, because of the creation of
the indebtedness hereby authorized, or under or by reason of the obligations,
covenants or agreements contained in this Indenture or in any of the Securities
or implied therefrom are hereby expressly waived and released as a condition of
and as a consideration for, the execution of this Indenture and the issue of
such Securities.

                                   ARTICLE XIV

                          SUBORDINATION OF SECURITIES
                          ---------------------------

     Section 14.01 Agreement to Subordinate. The Company, for itself, its
                   ------------------------
successors and assigns, covenants and agrees, and each holder of a Security of
any series likewise covenants and agrees by his acceptance thereof, that the
obligation of the Company to make any payment on account of the principal of and
interest on each and all of the Securities of any series shall be subordinate
and junior in right of payment to the Company's obligations to the holders of
Senior Indebtedness of the Company, and that in the case of any insolvency,
receivership, conservatorship, reorganization, readjustment of debt, marshalling
of assets and liabilities or similar proceedings or any liquidation or winding-
up of or relating to the Company as a whole, whether voluntary or involuntary,
all obligations of the Company to holders of Senior Indebtedness of the Company

                                       65
<PAGE>

shall be entitled to be paid in full in cash before any payment shall be made on
account of the principal of or interest on any of the Securities (except that
Holders may receive payments and other distributions made from any defeasance
trust created pursuant to SECTION 15.01 hereof). In the event of any such
proceeding, after payment in full in cash of all sums owing with respect to
Senior Indebtedness of the Company, the holders of the Securities of each
series, together with the holders of any obligations of the Company ranking on a
parity with the Securities, shall be entitled to be paid from the remaining
assets of the Company the amounts at the time due and owing on account of unpaid
principal of and interest on the Securities of any series before any payment or
other distribution, whether in cash, property or otherwise, shall be made on
account of any capital stock or any obligations of the Company ranking junior to
the Securities. In addition, in the event of any such proceeding, if any payment
or distribution of assets of the Company of any kind or character whether in
cash, property or securities, including any such payment or distribution which
may be payable or deliverable by reason of the payment of any other indebtedness
of the Company being subordinated to the payment of the Securities of any series
shall be received by the Trustee or the holders of the Securities of any series
before all Senior Indebtedness of the Company is paid in full, such payment or
distribution shall be held in trust for the benefit of and shall be paid over to
the holders of such Senior Indebtedness of the Company or their representative
or representatives or to the trustee or trustees under any indenture under which
any instruments evidencing any of such Senior Indebtedness of the Company may
have been issued, ratably, for application to the payment of all Senior
Indebtedness of the Company remaining unpaid until all such Senior Indebtedness
of the Company shall have been paid in full, after giving effect to any
concurrent payment or distribution to the holders of such Senior Indebtedness of
the Company. The obligations of the Company in respect of the Securities of all
series shall rank on a parity with any obligations of the Company ranking on a
parity with the Securities. Nothing in this SECTION 14.01 shall apply to claims
of, or payments to, the Trustee under or pursuant to SECTION 7.06.

     The subordination provisions of the foregoing paragraph shall not be
applicable to amounts at the time due and owing on the Securities of any series
on account of the unpaid principal of or interest on the Securities of such
series for the payment of which funds have been deposited in trust with the
Trustee or any Paying Agent or have been set aside by the Company in trust in
accordance with the provisions of this Indenture; nor shall such provisions
impair any rights, interests, or powers of any secured creditor of the Company
in respect of any security the creation of which is not prohibited by the
provisions of this Indenture.

     The Company shall give prompt written notice to the Trustee of any
insolvency, receivership, conservatorship, reorganization, readjustment of debt,
marshalling of assets and liabilities or similar proceedings or any liquidation
or winding-up of or relating to the Company as a whole, whether voluntary or
involuntary. The Trustee, subject to the provisions of SECTION 7.01, shall be
entitled to assume that, and may act as if, no such event has occurred unless a
Responsible Officer of the Trustee assigned to the Trustee's corporate trust
department has received at the principal office of the Trustee from the Company
or any one or more holders of Senior Indebtedness of the Company or any trustee
therefor (who shall have been certified or otherwise established to the
satisfaction of the Trustee to be such a holder or trustee) written notice
thereof. Upon any distribution of assets of the Company referred to in this
Article, the Trustee and holders of the Securities of each series shall be
entitled to rely conclusively upon any order or decree of a court of competent
jurisdiction in which proceedings relating to any event specified in the first

                                       66
<PAGE>

sentence of this paragraph are pending for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders of the Senior
Indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon, and all other facts pertinent thereto or
to this Article, and the Trustee, subject to the provisions of Article VII, and
the holders of the Securities of each series shall be entitled to rely
conclusively upon a certificate of the liquidating trustee or agent or other
person making any distribution to the Trustee or to the holders of the
Securities of each series for the purpose of ascertaining the persons entitled
to participate in such distribution, the holders of the Senior Indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article.
In the absence of any such liquidating trustee, agent or other person, the
Trustee shall be entitled to rely conclusively upon a written notice by a Person
representing himself to be a holder of Senior Indebtedness of the Company (or a
trustee or representative on behalf of such holder) as evidence that such Person
is a holder of such Senior Indebtedness (or is such a trustee or
representative). In the event that the Trustee determines, in good faith, that
further evidence is required with respect to the right of any Person, as a
holder of Senior Indebtedness of the Company, to participate in any payment or
distribution pursuant to this Section, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of such Senior Indebtedness held by such Person, as to the extent to which such
Person is entitled to participation in such payment or distribution, and as to
other facts pertinent to the rights of such Person under this Section, and if
such evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.

     Section 14.02 Obligation of The Company Unconditional. Nothing contained in
                   ---------------------------------------
this Article or elsewhere in this Indenture is intended to or shall impair, as
between the Company and the holders of the Securities of each series, the
obligation of the Company, which is absolute and unconditional, to pay to such
holders the principal of and interest on such Securities of each series when,
where and as the same shall become due and payable, all in accordance with the
terms of such Securities, or is intended to or shall affect the relative rights
of such holders and creditors of the Company other than the holders of the
Senior Indebtedness of the Company, nor shall anything herein or therein prevent
the Trustee or the holder of any Security from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article of the holders of Senior Indebtedness of the
Company in respect of cash, property, or securities of the Company received upon
the exercise of any such remedy.

     Section 14.03 Limitations On Duties to Holders of Senior Indebtedness of
                   ----------------------------------------------------------
The Company. With respect to the holders of Senior Indebtedness of the Company,
-----------
the Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness of
the Company shall be read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness of the Company, except with respect to moneys held in trust
pursuant to the first paragraph of SECTION 14.01.

                                       67
<PAGE>

     Section 14.04 Notice to Trustee of Facts Prohibiting Payment.
                   ----------------------------------------------
Notwithstanding any of the provisions of this Article or any other provisions of
this Indenture, the Trustee shall not at any time be charged with knowledge of
the existence of any facts which would prohibit the making of any payment of
moneys to or by the Trustee unless and until a Responsible Officer of the
Trustee assigned to its corporate trust department shall have received at the
principal office of the Trustee written notice thereof from the Company or from
one or more holders of Senior Indebtedness of the Company or from any trustee
therefor who shall have been certified by the Company or otherwise established
to the reasonable satisfaction of the Trustee to be such a holder or trustee;
and, prior to the receipt of any such written notice, the Trustee, subject to
the provisions of SECTION 7.01, shall be entitled in all respects to assume that
no such facts exist; provided, however, that, if prior to the fifth Business Day
preceding the date upon which by the terms hereof any such moneys may become
payable for any purpose, or in the event of the execution of an instrument
pursuant to SECTION 12.01 acknowledging satisfaction and discharge of this
Indenture, then if prior to the second Business Day preceding the date of such
execution, the Trustee shall not have received with respect to such moneys the
notice provided for in this Section, then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such moneys and/or apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such date; provided, however, no such application
shall affect the obligations under this Article of the Persons receiving such
moneys from the Trustee.

     The Trustee shall be entitled to rely on the delivery to it of a written
notice by a Person representing himself to be a holder of Senior Indebtedness
(or a trustee therefor) to establish that such notice has been given by a holder
of Senior Indebtedness (or a trustee therefor). In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any Person as a holder of Senior Indebtedness to participate in any
payment or distribution pursuant to this Article, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Indebtedness held by such Person, to the extent to which
such Person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such Person under this Article, and if
such evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.

     Section 14.05 Application By Trustee of Moneys Deposited With It. Anything
                   --------------------------------------------------
in this Indenture to the contrary notwithstanding, any deposit of moneys by the
Company with the Trustee or any agent (whether or not in trust) for any payment
of the principal of or interest on any Securities shall, except as provided in
SECTION 14.04, be subject to the provisions of SECTION 14.01.

     Section 14.06 Subrogation. Subject to the payment in full of all Senior
                   -----------
Indebtedness of the Company, the holders of the Securities of each series shall
be subrogated to the rights of the holders of such Senior Indebtedness to
receive payments or distributions of assets of the Company applicable to such
Senior Indebtedness until the Securities shall be paid in full, and none of the
payments or distributions to the holders of such Senior Indebtedness to which
the holders of the Securities of any series or the Trustee would be entitled
except for the provisions of this Article or of payments over pursuant to the
provisions of this Article to the holders of such Senior Indebtedness by the
holders of such Securities or the Trustee shall, as among the Company, its

                                       68
<PAGE>

creditors other than the holders of such Senior Indebtedness, and the holders of
such Securities, be deemed to be a payment by the Company to or on account of
such Senior Indebtedness; it being understood that the provisions of this
Article are and are intended solely for the purpose of defining the relative
rights of the holders of such Securities, on the one hand, and the holders of
the Senior Indebtedness of the Company, on the other hand.

     Section 14.07 Subordination Rights Not Impaired By Acts or Omissions of
                   ---------------------------------------------------------
Company or Holders of Senior Indebtedness of The Company. No right of any
--------------------------------------------------------
present or future holders of any Senior Indebtedness of the Company to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof with which any such holder may have or be
otherwise charged. The holders of Senior Indebtedness of the Company may, at any
time or from time to time and in their absolute discretion, change the manner,
place or terms of payment, change or extend the time of payment of, or renew or
alter, any such Senior Indebtedness of the Company, or amend or supplement any
instrument pursuant to which any such Senior Indebtedness of the Company is
issued or by which it may be secured, or release any security therefor, or
exercise or refrain from exercising any other of their rights under the Senior
Indebtedness of the Company including, without limitation, the waiver of default
thereunder, all without notice to or assent from the holders of the Securities
of each series or the Trustee and without affecting the obligations of the
Company, the Trustee or the holders of such Securities under this Article.

     Section 14.08 Authorization of Trustee to Effectuate Subordination of
                   -------------------------------------------------------
Securities. Each holder of a Security of any series, by his acceptance thereof,
----------
authorizes and expressly directs the Trustee on his behalf to take such action
as may be necessary or appropriate to effectuate, as between the holders of such
Securities and the holders of Senior Indebtedness of the Company, the
subordination provided in this Article. If, in the event of any proceeding or
other action relating to the Company referred to in the first sentence of
SECTION 14.01, a proper claim or proof of debt in the form required in such
proceeding or action is not filed by or on behalf of the holders of the
Securities of any series prior to fifteen days before the expiration of the time
to file such claim or claims, then the holder or holders of Senior Indebtedness
of the Company shall have the right to file and are hereby authorized to file an
appropriate claim for and on behalf of the holders of such Securities.

     Section 14.09 No Payment When Senior Indebtedness In Default. In the event
                   ----------------------------------------------
and during the continuation of any default in the payment of principal of (or
premium, if any) or interest on any Senior Indebtedness, or in the event that
any event of default with respect to any Senior Indebtedness shall have occurred
and be continuing and shall have resulted in such Senior Indebtedness becoming
or being declared due and payable prior to the date on which it would otherwise
have become due and payable, unless and until such event of default shall have
been cured, waived or remedied or shall have ceased to exist and such
acceleration shall have been rescinded or annulled, or in the event any judicial
proceeding shall be pending with respect to any such default in payment or such
event or default, then no payment or distribution of any kind or character,
whether in cash, properties or securities shall be made by the Company on
account of principal of (or premium, if any) or interest (including any
Additional Interest) if any, on the Securities or on account of the purchase or
other acquisition of Securities by the Company or any Subsidiary (except that

                                       69
<PAGE>

Holders of Securities may receive payments and other distributions made from any
defeasance trust created pursuant to SECTION 15.01 hereof).

     In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or the holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to a Responsible Officer of the
Trustee assigned to the principal office of the Trustee or, as the case may be,
such holder, then and in such event payment shall be paid over and delivered
forthwith to the Company.

     Section 14.10 Right of Trustee to Hold Senior Indebtedness of The Company.
                   -----------------------------------------------------------
The Trustee shall be entitled to all of the rights set forth in this Article in
respect of any Senior Indebtedness of the Company at any time held by it in its
individual capacity to the same extent as any other holder of such Senior
Indebtedness, and nothing in this Indenture shall be construed to deprive the
Trustee of any of its rights as such holder.

     Section 14.11 Article XIV Not to Prevent Defaults. The failure to make a
                   -----------------------------------
payment pursuant to the terms of Securities of any series by reason of any
provision in this Article shall not be construed as preventing the occurrence of
a default under this Indenture.

                                   ARTICLE XV

                    LEGAL DEFEASANCE AND COVENANT DEFEASANCE
                    ----------------------------------------

     Section 15.01 Option to Effect Legal Defeasance or Covenant Defeasance. The
                   --------------------------------------------------------
Company may, at the option of its Board of Directors evidenced by a resolution
set forth in an Officers' Certificate, at any time, elect to have either SECTION
15.02 or 15.03 be applied to all outstanding Securities of a series upon
compliance with the conditions set forth below in this Article XV.

     Section 15.02 Legal Defeasance and Discharge. Upon the Company's exercise
                   ------------------------------
under SECTION 15.01 of the option applicable to this SECTION 15.02, the Company
shall, subject to the satisfaction of the conditions set forth in SECTION 15.04,
be deemed to have been discharged from its obligations with respect to all
outstanding Securities of a series on the date the conditions set forth below
are satisfied (hereinafter, "LEGAL DEFEASANCE"). For this purpose, Legal
Defeasance means that the Company shall be deemed to have paid and discharged
the entire indebtedness represented by the outstanding Securities of such
series, which shall thereafter be deemed to be "outstanding" only for the
purposes of SECTION 15.05 and the other Sections of this Indenture referred to
in (a) and (b) below, and to have satisfied all its other obligations under such
Securities of such series and this Indenture (and the Trustee, on demand of and
at the expense of the Company, shall execute proper instruments acknowledging
the same), except for the following provisions which shall survive until
otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Securities of such series to receive solely from the trust fund
described in SECTION 15.04, and as more fully set forth in such Section,
payments in respect of the principal of or interest or premium, if any, on such
Securities of such series when such payments are due from the trust referred to
below, (b) the Company's obligations with respect to such Securities of such
series under ARTICLE II and SECTION 4.02, (c) the rights (including the rights

                                       70
<PAGE>

of the Trustee under Section 7.06), powers, trusts, duties and immunities of the
Trustee hereunder and the Company's obligations in connection therewith and (d)
this Article XV. Subject to compliance with this Article XV, the Company may
exercise its option under this SECTION 15.02 notwithstanding the prior exercise
of its option under SECTION 15.03.

     Section 15.03 Covenant Defeasance. Upon the Company's exercise under
                   -------------------
SECTION 15.01 of the option applicable to this SECTION 15.03, the Company shall,
subject to the satisfaction of the conditions set forth in SECTION 15.04 hereof,
be released from its obligations under the covenants contained in SECTION 4.09
hereof and SECTION 11.01 hereof with respect to the outstanding Securities of
such series on and after the date the conditions set forth in SECTION 15.04 are
satisfied (hereinafter, "COVENANT DEFEASANCE"), and the Securities of such
series shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder (it being
understood that such Securities of such series shall not be deemed outstanding
for accounting purposes). For this purpose, Covenant Defeasance means that, with
respect to the outstanding Securities of such series, the Company may omit to
comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a Default or an Event
of Default under SECTION 6.01, but, except as specified above, the remainder of
this Indenture and such Securities of such series shall be unaffected thereby.
In addition, upon the Company's exercise under SECTION 15.01 of the option
applicable to this SECTION 15.03, subject to the satisfaction of the conditions
set forth in SECTION 15.04, SECTION 6.01(C) shall not constitute Events of
Default.

     Section 15.04 Conditions to Legal or Covenant Defeasance. The following
                   ------------------------------------------
shall be the conditions to the application of either SECTION 15.02 or 15.03 to
the outstanding Securities of such series:

     In order to exercise either Legal Defeasance or Covenant Defeasance:

          (a) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, cash in United States dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay the principal of, premium, if any, and interest on the
outstanding Securities of such series on the stated date for payment thereof or
on the applicable redemption date, as the case may be, and the Company must
specify whether the Securities of such series are being defeased to maturity or
to a particular redemption date;

          (b) in the case of an election under SECTION 15.02 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
confirming that (A) the Company has received from, or there has been published
by, the Internal Revenue Service a ruling or (B) since the date of this
Indenture, there has been a change in the applicable federal income tax law, in
either case to the effect that, and based thereon such Opinion of Counsel shall
confirm that, the Holders of the outstanding Securities of such series will not
recognize income, gain or loss for federal income tax purposes as a result of
such Legal Defeasance and will be subject to federal income tax on the same

                                       71
<PAGE>

amounts, in the same manner and at the same times as would have been the case if
such Legal Defeasance had not occurred;

          (c) in the case of an election under SECTION 15.03 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
confirming that the Holders of the outstanding Securities of such series will
not recognize income, gain or loss for federal income tax purposes as a result
of such Covenant Defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as would have been the
case if such Covenant Defeasance had not occurred;

          (d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of Default
resulting from the incurrence of indebtedness or issuance of redeemable stock
all or a portion of the proceeds of which will be used to defease the Securities
of such series pursuant to this Article XV concurrently with such incurrence);

          (e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument (other than this Indenture) to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its Subsidiaries is
bound;

          (f) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders over any other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding creditors of the Company
or others; and

          (g) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for or relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.

     Section 15.05 Deposited Money and Government Securities to be Held in
                   -------------------------------------------------------
Trust; Other Miscellaneous Provisions. Subject to SECTION 15.06, all money and
-------------------------------------
non-callable Government Securities (including the proceeds thereof) deposited
with the Trustee (or other qualifying trustee, collectively for purposes of this
SECTION 15.05, the "TRUSTEE") pursuant to SECTION 15.04 in respect of the
outstanding Securities of such series shall be held in trust and applied by the
Trustee, in accordance with the provisions of such Securities of such series and
this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as Paying Agent) as the Trustee may determine, to
the Holders of such Securities of such series of all sums due and to become due
thereon in respect of principal, premium, if any, and interest, but such money
need not be segregated from other funds except to the extent required by law.

     The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to SECTION 15.04 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the outstanding Securities of such
series.

                                       72
<PAGE>

     Anything in this Article XV to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon the request of the
Company any money or non-callable Government Securities held by it as provided
in SECTION 15.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under SECTION
15.04(A)), are in excess of the amount thereof that would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

     Section 15.06 Repayment to Company. Any money deposited with the Trustee or
                   --------------------
any Paying Agent, or then held by the Company, in trust for the payment of the
principal of, premium, if any, or interest on any Security of such series and
remaining unclaimed for two years after such principal, and premium, if any, or
interest has become due and payable shall be paid to the Company on its request
or (if then held by the Company) shall be discharged from such trust; and the
Holder of such Security of such series shall thereafter look only to the Company
for payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, shall upon a
written request of the Company and at the expense of the Company cause to be
published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
notification or publication, any unclaimed balance of such money then remaining
will be repaid to the Company.

     Section 15.07 Reinstatement. If the Trustee or Paying Agent is unable to
                   -------------
apply any United States dollars or non-callable Government Securities in
accordance with SECTION 15.02 or 15.03, as the case may be, by reason of any
order or judgment of any court or governmental authority enjoining, restraining
or otherwise prohibiting such application, then the Company's obligations under
this Indenture and the Securities of such series shall be revived and reinstated
as though no deposit had occurred pursuant to SECTION 15.02 or 15.03 until such
time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with SECTION 15.02 or 15.03, as the case may be; provided, however,
that, if the Company makes any payment of principal of, premium, if any, or
interest on any Security of such series following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of
such Securities of such series to receive such payment from the money held by
the Trustee or Paying Agent.

                                   ARTICLE XVI

                            MISCELLANEOUS PROVISIONS
                            ------------------------

     Section 16.01 Successors and Assigns of Company Bound By Indenture. All the
                   ----------------------------------------------------
covenants, stipulations, promises and agreements in this Indenture contained by
or in behalf of the Company shall bind its successors and assigns, whether so
expressed or not.

     Section 16.02 Acts of Board, Committee or Officer of Successor Corporation
                   ------------------------------------------------------------
Valid. Any act or proceeding by any provision of this Indenture authorized or
-----
required to be done or performed by any board, committee or officer or officers
of the Company shall and may be done and performed with like force and effect by

                                       73
<PAGE>

the like board, committee or officer or officers of any corporation that shall
at the time be the lawful sole successor of the Company.

     Section 16.03 Required Notices or Demands May Be Served By Mail. Any notice
                   -------------------------------------------------
or demand which by any provision of this Indenture is required or permitted to
be given or served by the Trustee, by the holders of Securities or by the
holders of Preferred Securities to or on the Company may be given or served by
registered mail postage prepaid addressed (until another address is filed by the
Company with the Trustee for such purpose), as follows: DPL Inc., Courthouse
Plaza Southwest, Dayton, Ohio 45402, Attention: General Counsel. Except as
otherwise provided herein, any notice, direction, request, demand, consent or
waiver by the Company, by any Securityholder or by any holder of a Preferred
Security to or upon the Trustee shall be deemed to have been sufficiently given,
made or filed, for all purposes, if given, made or filed in writing to or with
the Trustee at the principal office of the Trustee, The Bank of New York, 101
Barclay Street, Floor 21 West, New York, New York 10286, Attention: Corporate
Trust Administration.

     Section 16.04 Officers' Certificate and Opinion of Counsel to Be Furnished
                   ------------------------------------------------------------
Upon Applications or Demands By The Company. Upon any request or application by
-------------------------------------------
the Company to the Trustee to take any action under any of the provisions of
this Indenture, the Company shall furnish to the Trustee an Officers'
Certificate stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with and an Opinion
of Counsel stating that in the opinion of such counsel all such conditions
precedent have been complied with, except that in the case of any such
application or demand as to which furnishing of such document is specifically
required by any provision of this Indenture relating to such particular
application or demand no additional certificate or opinion need be furnished.

     Each certificate or opinion provided for in this Indenture and delivered to
the Trustee with respect to compliance with a condition or covenant provided for
in this Indenture, other than certificates provided pursuant to SECTION 4.06,
shall include (1) a statement that the person making such certificate or opinion
has read such covenant or condition; (2) a brief statement as to the nature and
scope of the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based; (3) a statement that, in the
opinion of such person, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or not such
covenant or condition has been complied with; and (4) a statement as to whether
or not, in the opinion of such person, such condition or covenant has been
complied with.

     Any certificate, statement or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of
or representations by counsel, unless such officer knows that the certificate or
opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based, insofar as it relates
to factual matters, upon the certificate, statement or opinion of or
representations by an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows that the certificate, statement or opinion or
representations with respect to the matters upon which his certificate,

                                       74
<PAGE>

statement or opinion may be based as aforesaid are erroneous, or in the exercise
of reasonable care should know that the same are erroneous.

     Any certificate, statement or opinion of an officer of the Company or of
counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants, unless such officer or counsel, as the case may be, knows that the
certificate or opinion or representations with respect to the accounting matters
upon which his certificate, statement or opinion may be based as aforesaid are
erroneous, or in the exercise of reasonable care should know that the same are
erroneous. Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.

     Section 16.05 Payments Due On Saturdays, Sundays, and Holidays. In any case
                   ------------------------------------------------
where the date of payment of interest on or principal of the Securities of any
series or the date fixed for any redemption of any Security of any series shall
not be a Business Day, then payment of interest or principal need not be made on
such date, but shall be made on the next succeeding Business Day with the same
force and effect as if made on the date fixed for the payment of interest on or
principal of the Security or the date fixed for any redemption of any Security
of such series, and no additional interest shall accrue for the period after
such date and before payment.

     Section 16.06 Provisions Required By Trust Indenture Act of 1939 to
                   -----------------------------------------------------
Control. If and to the extent that any provision of this Indenture limits,
-------
qualifies or conflicts with another provision included in this Indenture which
is required to be included in this Indenture by any of Sections 310 to 317,
inclusive, of the Trust Indenture Act through operation of Section 318(c)
thereof, such required provision shall control.

     Section 16.07 Indenture and Securities to Be Construed In Accordance With
                   -----------------------------------------------------------
The Laws of The State of New York. This Indenture and each Security shall be
---------------------------------
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be governed by and construed in accordance with the laws of
said State (including without limitation Section 5-1401 of the New York General
Obligations Law or successor to such statute).

     Section 16.08 Provisions of The Indenture and Securities for The Sole
                   -------------------------------------------------------
Benefit of The Parties and The Securityholders. Nothing in this Indenture or in
----------------------------------------------
the Securities, expressed or implied, shall give or be construed to give any
person, firm or corporation, other than the parties hereto and their successors
and assigns and the holders of the Securities, any legal or equitable right,
remedy or claim under or in respect of this Indenture, or under any covenant,
condition and provision herein contained; all its covenants, conditions and
provisions being for the sole benefit of the parties hereto and their successors
and assigns and of the holders of the Securities and, to the extent expressly
provided in SECTIONS 6.01, 6.05, 6.06, 9.07, 10.01 and 10.02, the holders of
Preferred Securities.

     Section 16.09 Indenture May Be Executed In Counterparts. This Indenture may
                   -----------------------------------------
be executed in any number of counterparts, each of which shall be an original;
but such counterparts shall together constitute but one and the same instrument.

                                       75
<PAGE>

     Section 16.10 Securities In Foreign Currencies. Whenever this Indenture
                   --------------------------------
provides for any action by, or any distribution to, holders of Securities
denominated in United States dollars and in any other currency, in the absence
of any provision to the contrary in the form of Security of any particular
series, the relative amount in respect of any Security denominated in a currency
other than United States dollars shall be treated for any such action or
distribution as that amount of United States dollars that could be obtained for
such amount on such reasonable basis of exchange and as of such date as the
Company may specify in a written notice to the Trustee.

     The Bank of New York, the party of the second part, hereby accepts the
trusts in this Indenture declared and provided, upon the terms and conditions,
herein above set forth.

                                       76
<PAGE>

     IN WITNESS WHEREOF, DPL Inc., the party of the first part, has caused this
Indenture to be signed and acknowledged by Elizabeth M. McCarthy, its Vice
President and Chief Financial Officer and The Bank of New York, the party of the
second part, has caused this Indenture to be signed and acknowledged by Paul J.
Schmalzel, one of its Vice Presidents, all as of the day and year first written
above.

                                        DPL INC.

                                        By:     /s/Elizabeth M. McCarthy
                                           ------------------------------------
                                           Name:   Elizabeth McCarthy
                                           Title:  Vice President and Chief
                                                   Financial Officer

                                        THE BANK OF NEW YORK, as Trustee

                                        By:     /s/Paul J. Schmalzel
                                           ------------------------------------
                                           Name:   Paul J. Schmalzel
                                           Title:  Vice President

                                       77
<PAGE>

STATE OF OHIO            )
                         :    ss.:
COUNTY OF DAYTON         )

     On the 31 day of August, 2001, before me personally came Elizabeth M.
McCarthy, to me known, who, being by me duly sworn, did depose and say that she
is a Vice President and Chief Financial Officer of DPL Inc., a corporation
described in and which executed the foregoing instrument; and that she signed
her name thereto by authority of the Board of Directors of such corporation.

                                                    /s/Timothy G. Rice
                                             ----------------------------------
                                                       Notary Public

                                       78
<PAGE>

STATE OF NEW YORK        )
                         :    ss.:
COUNTY OF NEW YORK       )

     On the 31 day of August, 2001, before me personally came Paul J. Schmalzel,
to me known, who, being by me duly sworn, did depose and say that he is a Vice
President of The Bank of New York, a corporation described in and which executed
the foregoing instrument; and that he signed his name thereto by authority of
the Board of Directors of such corporation.

                                                   /s/William J. Cassels
                                             ----------------------------------
                                                       Notary Public

                                       79

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00207-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00207-of-00352.parquet"}]]