Document:

ex4_1.htm

    
      EXHIBIT
4.1

    

    

    

    FIRST SUPPLEMENTAL INDENTURE,
dated as of April 24, 2009 (this “Supplemental
Indenture”), between The Toledo Edison Company, a corporation organized
and existing under the laws of the State of Ohio (the “Company”), and The
Bank of New York Mellon Trust Company, N.A. (formerly known as The Bank of New
York Trust Company, N.A.), as trustee under the Indenture referred to below (the
“Trustee”).

    

    W
I T N E S S E T H

    

    WHEREAS, the Company has
heretofore executed and delivered to the Trustee an indenture, dated as of
November 1, 2006 (as amended, supplemented, restated or otherwise modified from
time to time, the “Indenture”;
capitalized terms used herein but not defined herein have the meanings set forth
in the Indenture), pursuant to which the Company issued $300,000,000 aggregate
principal amount of 6.15% Senior Notes due 2037 (the “6.15%
Notes”);

     

    WHEREAS, the Company intends
to issue an additional $300,000,000 aggregate principal amount of 7.25% Senior
Secured Notes due 2020 (the “7.25% Notes,”
together with the 6.15% Notes, the “Notes”) pursuant to
this Supplemental Indenture under the Indenture;

     

    WHEREAS, pursuant to Section
608 of the Indenture, the Company may not incur liens securing debt unless it
has made or will make effective provision whereby each series of notes issued
under the Indenture are equally and ratably secured with such debt for so long
as such debt is secured, subject to the terms of the Indenture;

     

    WHEREAS, concurrently
herewith, the Company is entering into the fifty-seventh supplemental indenture
between the Company and The Bank of New York Mellon Trust Company, N.A., as
trustee, in the form attached hereto as Exhibit A (the “Supplemental
Mortgage”) supplementing an Indenture of Mortgage and Deed of Trust,
dated as of April 1, 1947, between the Company and The Chase National Bank of
the City of New York, as predecessor trustee (as amended and supplemented from
time to time, the “Mortgage”);

     

    WHEREAS, the Supplemental
Mortgage provides for the issuances of two new series of first mortgage bonds to
be designated as (i) First Mortgage Bonds, 7.25% Series of 2009 Due 2020 (the
“Bonds of 7.25%
Series”) and (ii) First Mortgage Bonds, 6.15% Series of 2009 Due 2037
(the “Bonds of 6.15%
Series”), with the respective denominations, rates of interest, dates of
maturity, redemption provisions and other provisions and agreements in respect
thereof as set forth in the Supplemental Mortgage;

     

    WHEREAS, the Bonds of 7.25%
Series are to be issued by the Company and delivered to the Trustee pursuant to
this Supplemental Indenture to evidence and secure the Company’s obligation to
pay the principal of and premium, if any, and interest on the $300,000,000
aggregate principal amount of 7.25% Notes under this Supplemental
Indenture;

     

    WHEREAS, the Bonds of 6.15%
Series are to be issued by the Company and delivered to the Trustee pursuant to
this Supplemental Indenture under which the Trustee will hold, for so long as
the Bonds of the 7.25% Series or any other Bonds of Specified Series referred to
herein shall be outstanding, the Bonds of 6.15% Series as security for the
payment of principal of and premium, if any, and interest on the outstanding
6.15% Notes under the Indenture;  

     

    WHEREAS, Section 1201(e) of
the Indenture authorizes the Company and the Trustee, without the consent of any
Holder, to amend the Indenture for the purpose of securing all but not part of
the

    

    
      
        
           

        

        
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    Securities
(including the Notes) issued under the Indenture;

    

    WHEREAS, the Company, by
appropriate corporate action, has determined to supplement the Indenture in the
manner described below, and all acts or proceedings necessary to authorize and
constitute this Supplemental Indenture a valid and binding agreement in
accordance with the terms hereof, have been done and taken; and

    

    WHEREAS, the Company has
requested that the Trustee execute and deliver this Supplemental Indenture for
the purpose of issuing the 7.25% Notes and securing the Notes.

    

    NOW THEREFORE, in
consideration of the premises and the mutual agreements contained herein and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto agree as follows for the benefit of each
other party and for the equal and ratable benefit of the Holders of the
Notes:

    

    
      	
              1.  

            	
              Article
      Fifteen (First
      Mortgage Bonds) of the Indenture is hereby created, and Section
      1501 to Section 1508 shall read as
follows:

            

    

     

    “Section 1501. Certain
Definitions.  For all purposes under this Indenture and any
supplemental indenture hereto, except as otherwise expressly provided or unless
the context otherwise requires, the following terms shall have the following
meanings:

     

    “Bonds of 6.15% Series” has the meaning set
forth in the Supplemental Mortgage.

     

    “Bonds of 7.25% Series” has the meaning set
forth in the Supplemental Mortgage.

     

    “Bonds of Specified Series” means (i) the Bonds
of 7.25% Series and (ii) Bonds of any other series of Bonds designated as a
“Specified Series” in connection with the initial authentication and issuance of
the Related Series of Securities pursuant to Section 303 hereof.

     

    “Bonds” means the Bonds of 6.15% Series and the
Bonds of 7.25% Series and any additional series of first mortgage bonds issued
under the Mortgage to evidence and secure the Company’s obligation to pay the
principal of and premium, if any, and interest on any future issuances of
Securities under the Indenture.

     

    “Discharge Date” means the date that all the
Bonds of 7.25% Series and all of the other Bonds of Specified Series have been
retired (whether at, before or after the maturity thereof) through payment,
redemption, purchase, defeasance or otherwise.

     

    “Expert” means any officer of the Company
familiar with the terms of the Mortgage and this Indenture, any law firm, any
investment banking firm, or any other Person, satisfactory in the reasonable
judgment of the Trustee.

     

    “Mortgage Trustee” means the Person serving as
trustee at any time under the Mortgage.

     

    “Related Series of Bonds” means, when used in
reference to the Company’s 7.25% Senior Secured Notes due 2020 (the “7.25%
Notes”), the Bonds of 7.25% Series, and when used in reference to the Company’s
6.15% Senior Notes due 2037 (the “6.15% Notes,” together with the 7.25% Notes,
the “Notes”), the Bonds of 6.15% Series and, when used in reference to any other
series of Securities, means the series of Bonds delivered to the Trustee in
connection with the initial authentication and issuance of such series of
Securities pursuant to Section 303 hereof.

     

    

    
      
        
           

        

        
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    “Related Series of Securities” means, when used
in reference to Bonds of 7.25% Series, the 7.25% Notes and, when used in
reference to Bonds of 6.15% Series, the 6.15% Notes and, when used in reference
to any other series of Bonds, means the series of Securities in respect of which
such series of Bonds were delivered to the Trustee pursuant to Section 303
hereof.

     

    “Supplemental Mortgage” means the Fifty-Seventh
Supplemental Indenture, dated as of April 24, 2009, among the Company and The
Bank of New York Mellon Trust Company, N.A., a national banking association, as
trustee, supplementing an Indenture of Mortgage and Deed of Trust, dated as of
April 1, 1947, between the Company and The Chase National Bank of the City of
New York, as predecessor trustee (as amended and supplemented from time to time,
the “Mortgage”).

     

               Section
1502.  Acceptance of the Bonds;
Security. The Company hereby delivers to the Trustee in trust for the
benefit of the Holders of the Related Series of Securities, and the Trustee
shall accept therefor, and acknowledge receipt of, Bonds of 6.15% Series and
Bonds of 7.25% Series registered in the name of the Trustee. Subject to Article
Seven hereof, Bonds of the applicable series delivered pursuant to this Section
1502 or pursuant to Section 1507 to the Trustee, for the benefit of Holders of
the Related Series of Securities, shall constitute part of the trust estate and
the Company hereby grants a security interest in such Bonds to the Trustee, for
the benefit of such Holders of the Related Series of Securities to secure the
payment and performance of any and all obligations of the Company under such
Securities, including, but not limited to (1) the full and prompt payment of the
principal of and premium, if any, on such Securities when and as the same shall
become due and payable in accordance with the terms and provisions of this
Indenture or such Securities, either at the Stated Maturity thereof, upon
acceleration of the Maturity thereof or upon redemption, and (2) the full and
prompt payment of any interest on such Securities when and as the same shall
become due and payable in accordance with the terms and provisions of this
Indenture or such Securities.

     

    Section 1503. The Bonds Held by the
Trustee.  The Trustee shall, as the holder of the Bonds, attend
such meeting or meetings of bondholders under the Mortgage or, at its option,
deliver its proxy in connection therewith, as relate to matters with respect to
which it is entitled to vote or consent.  Notwithstanding the
foregoing, the Trustee, as holder of the Bonds of any series, shall not be
required to vote or give any consent with respect to such Bonds unless directed
to do so by the holders of a majority in principal amount of the Related Series
of Securities, unless the vote or consent is with respect to matters which under
the Mortgage require the vote or consent of the holders of a greater percentage
in principal amount of the Bonds of any series, in which case such direction
must be from holders of such greater percentage in principal amount of the
Related Series of Securities.

    

    Section 1504.  No Transfer of Bonds;
Exceptions.  Except (i) as required to effect an assignment to
a successor trustee under this Indenture, (ii) pursuant to Section 1505 hereof,
or (ii) in compliance with a final order of a court of competent jurisdiction in
connection with any bankruptcy or reorganization proceeding of the Company, the
Trustee shall not sell, assign or transfer the Bonds and the Company shall issue
stop transfer instructions to the Mortgage Trustee to effect compliance with
this Section 1504.

     

    Section 1505. Surrender to the Company of
the Bonds.  When the obligation of the Company to make payment
with respect to the principal of and premium, if any, and interest on all Bonds
shall be deemed satisfied and discharged pursuant to the second paragraph of
Section 1508 hereof or when all of the Outstanding Securities shall be deemed to
have been paid under Section 701 hereof, the Trustee shall, upon written request
of the Company, surrender to the

     

    

    
      
        
           

        

        
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    Company all of the
Bonds, together with such appropriate instruments of transfer or release as may
be reasonably requested by the Company. At any time that a portion of a Security
shall be deemed to have been paid pursuant to Section 701 hereof and the Company
shall have provided the Trustee with notice thereof, the Trustee shall surrender
an equal principal amount of the Related Series of Bonds to the Company for
cancellation, together with such appropriate instruments of transfer or release
as may be reasonably requested by the Company; provided, however, that the principal
amount of such Bonds surrendered shall be reduced as may be necessary to ensure
that the aggregate principal amount of such series of Bonds held by the Trustee
shall in no event be less than the aggregate amount of the Related Series of
Securities Outstanding.  The Trustee shall, together with such Bonds,
deliver to the Company such appropriate instruments of transfer or release as
the Company may reasonably request. All Bonds delivered in accordance with this
Section 1505 shall be delivered by the Company to the Mortgage Trustee for
cancellation.

     

    Section 1506. Fair Value
Certificate.  (a) If required by applicable law, upon the
delivery  by the Company to the Trustee of the Bonds pursuant to
Section 1502 or Section 1507 hereof,  the Company shall simultaneously
therewith deliver to the Trustee a certificate of an Expert (1) stating that he,
she or it is familiar with the  provisions of such series of Bonds and
of this Indenture; (2) stating the  principal amount of such series of
Bonds so delivered,  the stated interest rate (or method of
calculation of interest) of such series of Bonds (if any) and the
Stated  Maturity of such series of Bonds; (3) identifying the series
of Securities being issued contemporaneously therewith, and (4) stating the fair
value to the Company of such series of Bonds. If the fair value to the
Company  of such series of Bonds so delivered, as described in the
certificate to be delivered  pursuant to this Section 1506(a), both
(l) is equal to or exceeds (A) $25,000 and (B) 1% of the principal amount of the
Securities Outstanding at the date of  delivery of such series of
Bonds and (2) together with the fair value to the Company, as described in the
certificates to be delivered pursuant to this Section 1506(a), of all other
Bonds delivered  to the Trustee since the commencement of the then
current calendar year, is equal to or exceeds 10% of the principal amount of the
Securities Outstanding at the date of delivery of such series of Bonds, then the
certificate required by this Section 1506(a) shall (1) be delivered by an Expert
who shall be independent of the Company and (2) in addition to the
certifications described above, state the fair value to the Company of all Bonds
delivered to the Trustee pursuant to Section 1506 hereof since the commencement
of the then current year as to which a certificate was not delivered by an
Expert independent of the Company.

     

    (b)  If a
series of Bonds are delivered or surrendered to the Company pursuant to Section
1505 hereof, the Company shall simultaneously therewith deliver to the Trustee a
certificate of an Expert (1) stating that it is familiar with the provisions of
such series of Bonds and of this Indenture, (2) stating the principal amount of
such series of Bonds so delivered, the stated  interest rate (or
method of calculation of interest) of such series of Bonds (if any) and the
Stated Maturity of such series of Bonds, (3) if applicable, identifying the
Securities, the payment of the interest on and principal of which has been
discharged hereunder, and (4) stating that such delivery and release will not
impair the lien of this Indenture in contravention of the provisions of this
Indenture. If, prior to the Discharge Date, the fair value of the Bonds so
delivered and released, as described in the certificate to be
delivered  pursuant to this Section 1506(b), both (l) is equal to or
exceeds (A) $25,000 and (B) 1% of the principal amount of the
Outstanding  Securities at the date of release of such Bonds and (2)
together with the fair value, as described in the certificates to be
delivered  pursuant to this Section 1506(b), of all other Bonds
released from the lien of this Indenture since the commencement of the then
current calendar year, is equal to or exceeds 10% of the  principal
amount of the Securities Outstanding at the date of release of such

     

    

    
      
        
           

        

        
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    Bonds, then the
certificate required by this Section 1506(b) shall be delivered by an Expert who
shall be independent of the Company.

     

    If,
in connection  with a delivery or release of outstanding series of
Bonds, the Company provides to the Trustee an Opinion of Counsel stating that
the certificate described by this Section 1506 is not required by law, such
certificate shall not be required to be delivered thereunder in connection with
such delivery or release.

     

    Section 1507.  Acceptance of Additional
Bonds.  Upon the issuance of a series of Securities hereunder
(other than the 6.15% Notes and the 7.25% Notes) at any time prior to the
Discharge Date, the Company shall deliver to the Trustee in trust for the
benefit of the Holders of such Securities, and the Trustee shall accept
therefor, a Related Series of Bonds registered in the name of the Trustee
conforming to the requirements of Section 1508 hereof.  A supplemental
indenture which, in connection with the issuance of such an additional series of
Securities, provides for the delivery to the Trustee of a Related Series of
Bonds and related matters shall be deemed not to adversely affect interests of
the Holders of any other series of Securities in any material
respect.

     

    Section 1508.  Terms Of the
Bonds.  Each series of Bonds delivered to the
Trustee  pursuant to Section 1501 or Section 1507 hereof shall have
the same Stated Maturity as, and shall be in the same aggregate principal amount
as, and have redemption provisions corresponding to, the Related Series of
Securities being issued; it being expressly understood that such series of Bonds
may, but need not, bear interest, any such interest to be payable on the same
Interest Payment Dates as the Related Series of Securities being
issued.

     

    Notwithstanding
anything in this Indenture to the contrary, from and after the Discharge
Date,  the obligation of the Company to make payment with respect to
the principal of and premium, if any, and interest on the Bonds of all series
shall be deemed satisfied and discharged as provided in the supplemental
indenture or indentures to the Mortgage creating any series of Bonds and such
series of Bonds shall cease to secure in any manner Securities theretofore or
subsequently issued. From and after the Discharge Date, any conditions to the
issuance of Securities that refer or relate to the Bonds or the Mortgage shall
be inapplicable.

     

    Prior to the
Discharge Date, the Company shall not issue any additional Bonds under the
Mortgage other than as collateral security for the Securities, except to the
extent as permitted under Section 608 hereof. The Company shall notify the
Trustee in an Officer’s Certificate promptly of the occurrence of the Discharge
Date and the Trustee shall be entitled to conclusively rely on such Officer’s
Certificate. Notice of the occurrence of the Discharge Date shall be given by
the Trustee to the Holders of the Securities in the manner provided in Section
106 hereof not later than 30 days after the Discharge Date.

     

    Section 1509.  Opinions of
Counsel.  The Company will cause this Indenture, any indentures
supplemental to this Indenture, and any financing or continuation statements to
be promptly recorded and filed and rerecorded and refiled in such a manner and
in such places, as may be required by law in order fully to preserve, protect
and perfect the security interests of the holders of the Securities and all
rights of the Trustee, and shall deliver to the Trustee:

    

    (a)  promptly
after the execution and delivery of any supplemental indenture to this Indenture
but prior to the Discharge Date, an Opinion of Counsel either stating that, in
the opinion of such counsel, this Indenture or such supplemental indentures and
any financing or continuation statements have been properly recorded and filed
so as to make effective and to perfect the

    

    
      
        
           

        

        
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    security interest of
the Trustee intended to be created by this Indenture for the benefit of the
Holders from time to time of the Securities in the Related Series of Bonds, and
reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to perfect or make such security interest
effective; and

    

    (b)  on or
before April 24, of each year, commencing April 24, 2010, and prior to the
Discharge Date, an Opinion of Counsel either stating that in the opinion of such
counsel such action has been taken, since the date of the most recent Opinion of
Counsel furnished pursuant to this Section 1509(b) or the first Opinion of
Counsel furnished pursuant to Section 1509(a) hereof, with respect to the
recording, filing, rerecording, or refiling of this Indenture, each supplemental
indenture and any financing or continuation statements, as is necessary to
maintain and perfect the security interest of the Trustee intended to be created
by this Indenture for the benefit of the holders from time to time of the
Securities in the Related Series of Bonds, and reciting the details of such
action, or stating that in the opinion of such counsel no such action is
necessary to maintain and perfect such security interest.

    

    Section 1510.  Further
Assurances.  The Company, at its own expense, shall do such
further lawful acts and things, and execute and deliver such additional
conveyances, assignments, assurances, agreements, financing statements and
instruments, as may be necessary in order to better assign, assure and confirm
to the Trustee its interest in the Bonds and for maintaining, protecting and
preserving such interest.

    

    
      	
              2.

            	
              A new Section
      116 (Approval By Trustee) is hereby added immediately following the
      existing Section 115 of the Indenture to read as
  follows:

            

    

    

    “Section 116.  Approval By
Trustee.  Wherever the Trustee is required to approve an Expert
or counsel who is to furnish evidence of compliance with conditions precedent in
this Indenture, such approval by the Trustee shall be deemed to have been given
upon the taking of any action by the Trustee pursuant to and in accordance with
the certificate or opinion so furnished by such Expert or counsel.”

    

    3.           Section
301 (Amount Unlimited: Issuable in Series) of the Indenture is hereby amended by
theaddition of the following paragraph after the existing paragraph (w), and
changing the existingparagraphs (x) and (y) to paragraphs (y) and (z),
respectively:

     

    “(x)  if prior to the Discharge Date,
the designation of the series of Bonds being delivered to the Trustee in
connection with the Related Series of Securities and whether such Bonds are
designated as Bonds of a “Specified Series”;”

     

    
      	
              4.

            	
              Section 303
      (Execution, Authentication, Delivery and Dating) of the Indenture is
      hereby amended by the deletion of the word “and” immediately following
      paragraph (d)(ii) and the addition of the following paragraphs immediately
      following the phrase “and by an implied covenant of good faith, fair
      dealing and reasonableness;” in paragraph
  (d)(iii):

            

    

     

    “(iv) if prior to
the Discharge Date, the series of Bonds being delivered to the Trustee in
connection with the issuance of the Related Series of Securities have been duly
authorized, executed and delivered by the Company, and that the Bonds of such
series are valid and binding obligations of the Company enforceable against the
Company in accordance with their terms and entitled to the benefits provided by
this Indenture, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance and other similar laws
relating to or affecting creditors’ rights generally, by general equitable
principles (regardless of whether

     

    

    
      
        
           

        

        
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    considered in a
proceeding in equity or at law) and by an implied covenant of good faith, fair
dealing and reasonableness; and that such series of Bond are entitled to the
benefit of the Mortgage, equally and ratably, with all first mortgage bonds
outstanding thereunder, except as to sinking fund provisions, if any;
and

     

    (v)  if prior to the Discharge Date,
that the Mortgage (except the supplemental indenture establishing the Related
Series of Bonds being delivered to the Trustee in connection with the issuance
of the Related Series of Securities) and all financing statements have been duly
filed and recorded in all places where such filing or recording is necessary for
the perfection or preservation of the lien of the Mortgage and the security
interests covered by such financing statement, and the Mortgage constitutes a
valid and perfected lien upon the property purported to be covered thereby,
subject only to permitted encumbrances (as defined in the Mortgage) and to liens
upon the property, if any, specifically identified in such supplemental
indenture prior to its recordation;

    

    
      	
              5.

            	
              Section 303
      (Execution, Authentication, Delivery and Dating) of the Indenture is
      hereby further amended by replacing the clause “and that in lieu of the
      opinions described in clauses (ii) and (iii) above Counsel may opine
      that:” in paragraph (d) thereof with “and that in lieu of the opinions
      described in clauses (ii), (iii) and (iv) above Counsel may opine that:”
      and adding the following paragraphs immediately following clause (y) of
      paragraph (d) thereof:

            

    

     

    
      	
               

            	
                   "(z)        
      if prior to the Discharge Date, the series of Bonds to be delivered to the
      Trustee in connection with the issuance of the Related Series of
      Securities have been duly authorized and when (i) the terms of such
      Securities shall have been established and such Securities have been
      authenticated and delivered by the Trustee and issued and delivered by the
      Company in the manner specified in clauses (x) and (y) above and (ii) the
      terms of the Bonds of such Related Series of Bonds corresponding to such
      Securities have been established pursuant to a written order of the
      Company under the Mortgage in accordance with Section 1508 and such Bonds
      have been duly executed by the Company and authenticated and delivered by
      the Mortgage Trustee in accordance with the Mortgage and such written
      order of the Company and issued and delivered by the Company in accordance
      with Section 1507 and the other provisions of this Indenture and in the
      manner and subject to any other qualifications in such Opinion of Counsel,
      such Bonds will be valid and binding obligations of the Company
      enforceable against the Company in accordance with their terms and
      entitled to the benefits provided by this Indenture, except as may be
      limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
      conveyance and other similar laws relating to or affecting creditors’
      rights generally, by general equitable principles (regardless of whether
      considered in a proceeding in equity or at law) and by an implied covenant
      of good faith, fair dealing and reasonableness; and such Bonds will be
      entitled to the benefit of the Mortgage, equally and ratably, with all
      first mortgage bonds outstanding thereunder, except as to sinking fund
      provisions, if any; and

            

    

     

    (e)           If
prior to the Discharge Date, (i) the certificate of an Expert meeting the
requirements of Section 1506(a) hereof and (ii) the Related Series of Bonds
meeting the requirements of Section 1508.”

     

    
      	
              6.

            	
              Section 601
      (Payment of Principal, Premium and Interest) of the Indenture is hereby
      amended by the addition of the following paragraph immediately after the
      existing paragraph in this
      section:         

            	
               

            

    

     

    “The Trustee shall
receive the Bonds from the Company as provided in this Indenture and shall hold
the Bonds of an applicable series, and any and all sums payable thereon or with
respect thereto or realized therefrom, in trust for the benefit of the holders
of the Related Series of

     

    

    
      
        
           

        

        
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    Securities, as
herein provided.  All payments made by or on behalf of the Company to
the Trustee on a series of Bonds shall be deemed to be a payment by the Company
pursuant to this Section 601 and shall be applied by the Trustee to pay, when
due, principal of, premium, if any, and/or interest on the Related Series of
Securities and, to the extent so applied, shall satisfy the Company’s
obligations on such Securities.”

     

    
      	
              7.

            	
              Section 701
      (Satisfaction and Discharge of Securities) of the Indenture is hereby
      amended by the addition of the following paragraph immediately after the
      last paragraph of this section:

            

    

     

    “If the Securities are deemed paid and
discharged pursuant to this Section 701, the obligation of the Company to make
payment with respect to the principal of, premium, if any, and interest on the
Related Series of Bonds shall be satisfied and discharged and such Bonds shall
cease to secure the Securities in any manner.”

     

    
      	
              8.

            	
              Section 702
      (Satisfaction and Discharge of Indenture) of the Indenture is hereby
      amended by restating the last paragraph thereof in its entirety as
      follows:

            

    

     

    “Upon satisfaction and discharge of this
Indenture as provided in this Section, the Trustee shall assign, transfer and
turn over to the Company, subject to the lien provided by Section 907, any and
all money, securities and other property, including the Bonds, then held by the
Trustee for the benefit of the Holders of the Securities other than money and
Eligible Obligations held by the Trustee pursuant to Section 703”

    

    
      	
              9.

            	
              Section 801
      (Events of Default) of the Indenture is hereby amended by the addition of
      the following paragraph after the existing paragraph (e), and changing the
      existing paragraph (f) to (g):

            

    

     

    “(f)  prior
to the Discharge Date, a default (as defined in Section 9.01 of the Mortgage)
has occurred and is continuing; provided, however, that anything in this
Indenture to the contrary notwithstanding, the waiver or cure of such default
under the Mortgage and the rescission and annulment of the consequences thereof
under the Mortgage shall constitute a waiver of the corresponding Event of
Default hereunder and a recission and annulment of the consequences thereof
hereunder; or” 

     

    
      	
              10.

            	
              Section 802
      (Acceleration of Maturity; Recission and Annulment) of the Indenture is
      hereby amended by:

            

    

     

    
      	
               
      

            	
              (a)  the
      addition of the following paragraph immediately after the first paragraph
      of this section:

            

    

     

    “Anything in this Indenture or in the
Securities contained to the contrary notwithstanding and, upon any Securities
being declared to be due and payable, the Trustee shall immediately file with
the Mortgage Trustee a written demand for redemption of all Related Series of
Bonds to the extent provided in the applicable provisions of the supplemental
indentures to the Mortgage.”

     

    (b)  amending
and restating the first part of the existing second paragraph of this Section
802until the phrase “(a) the Company shall have paid” to read as
follows:

     

    “At
any time after such a declaration of acceleration with respect to Securities of
any series shall have been made and before a judgment or decree for payment of
the money due shall have been obtained by the Trustee as hereinafter in this
Article provided, and prior to the acceleration of all of the Related Series of
Bonds issued and outstanding under the Mortgage, the

     

    

    
      
        
           

        

        
          8

          
            

          

        

        
           

        

      

    

    

    Event or Events of
Default giving rise to such declaration of acceleration shall, without further
act, be deemed to have been waived, and such declaration and its consequences
shall, without further act, be deemed to have been rescinded and annulled
if”

     

    
      	
              11.

            	
              Section 803
      (Collection of Indebtedness and Suits for Enforcement by Trustee) of the
      Indenture is hereby amended by restating the second paragraph thereof in
      its entirety as follows:

            

    

     

    
      	
               
      

            	
              “If the
      Company shall fail to pay such amounts forthwith upon such demand, the
      Trustee in its own name and as trustee of an express trust, may institute
      a judicial proceeding for the collection of the sums so due and unpaid,
      may prosecute such proceeding to judgment or final decree and may enforce
      the same against the Company or any other obligor upon such Securities or,
      prior to the Discharge Date, the Related Series of Bonds and collect the
      moneys adjudged or decreed to be payable in the manner provided by law out
      of the property of the Company or any other obligor upon such Securities
      or Bonds, wherever situated.”

            

    

     

    
      	
              12.

            	
              A new Section
      816 (Defaults under the Mortgage) is hereby added immediately following
      the existing Section 815 of the Indenture to read as
    follows:

            

    

     

    “Section
816.  Defaults under the
Mortgage.  In addition to every other right and remedy provided
herein, the Trustee may exercise, for the benefit of the Holders of Securities
of any series, any right or remedy available to the Trustee in its capacity as
owner and holder of the Related Series of Bonds which arises as a result of a
default (as defined in Section 9.01 of the Mortgage).”

    

    
      	
              13.

            	
              Section 903
      (Rights of Trustee) is hereby amended by the deletion of the word “and”
      immediately following the existing paragraph (i), the addition of the word
      “and” immediately after the existing paragraph (j) and the addition of the
      following paragraph immediately after the existing paragraph
      (j):

            

    

    

    
      	
               
      

            	
              “(k) The
      Trustee shall not be responsible for perfecting or maintaining the
      perfection of any security interest granted to it hereunder and shall not
      be responsible for filing, re-filing, recording or re-recording any
      financing statement, continuation statement, notice to third parties or
      any other document in any public office at any time or
    times.”

            

    

    

    
      	
              14.

            	
              Section 1101
      (Company May Consolidate, etc. Only on Certain Terms) of the Indenture is
      amended by the addition of the following paragraph immediately after
      paragraph (a):

            

    

     

    “and, if such
consolidation, merger, sale, transfer or other disposition occurs prior to the
Discharge Date, such Person shall expressly assume, by a supplemental indenture
to the Mortgage, executed and delivered to the Mortgage Trustee, the due and
punctual payment of the principal of and premium, if any, and interest on all of
the Bonds and the performance of every covenant of the Mortgage on the part of
the Company;”

     

    
      	
              15.

            	
              Upon execution
      and delivery of this Supplemental Indenture, the Indenture shall be
      modified and amended in accordance with this Supplemental Indenture, and
      all the terms and conditions of both shall be read together as though they
      constitute one instrument, except that, in case of conflict, the
      provisions of this Supplemental Indenture will control.  All
      references to the Indenture in the Indenture or in any other agreement,
      document or instrument delivered in connection therewith or pursuant
      thereto shall be deemed to refer to the Indenture as amended by this
      Supplemental Indenture.  The Indenture, as modified and amended
      by this Supplemental Indenture, is hereby ratified and confirmed in all
      respects.

            

    

     

    

    
      
        
           

        

        
          9

          
            

          

        

        
           

        

      

    

    

    
      	
              16.

            	
              THIS SUPPLEMENTAL INDENTURE AND
      THE NOTES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
      OF THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF
      THE NEW YORK GENERAL OBLIGATIONS LAW OR ANY SUCCESSOR TO SUCH STATUTE)
      EXCEPT TO THE EXTENT THAT THE TRUST INDENTURE ACT SHALL BE
      APPLICABLE.

            

    

     

    
      	
              17.

            	
              All agreements
      of the Company in this Supplemental Indenture shall bind its
      successors.  All agreements of the Trustee in
      this  Supplemental Indenture shall bind its
      successors.

            

    

     

    
      	
              18.

            	
              The parties
      may sign any number of copies of this Supplemental
      Indenture.  Each signed copy shall be an original, but all of
      them together represent the same agreement.   One signed
      copy of the Supplemental Indenture is enough to prove this Supplemental
      Indenture.

            

    

     

    
      	
              19.

            	
              In entering
      into this Supplemental Indenture, the Trustee shall be entitled to the
      benefit of every provision of the Indenture relating to the conduct or
      affecting the liability or affording protection to the Trustee, whether or
      not elsewhere herein so provided.

            

    

     

    
      	
              20.

            	
              The Trustee
      shall not be responsible in any manner whatsoever for or in respect of the
      validity or sufficiency of this Supplemental Indenture or for or in
      respect of the recitals contained herein, all of which recitals are made
      by the Company solely.

            

    

     

    [signature pages
follow]

    

    
      
        
           

        

        
          10

          
            

          

        

        
           

        

      

    

    

    IN WITNESS WHEREOF, the
parties hereto have caused this Supplemental Indenture to be duly executed, all
as of the date first above written.

     

     

    
      
        
          
            
              	 
    	
                      THE
      TOLEDO EDISON COMPANY

                    
	 
    	
                      By:

                    	
                      /s/ Randy
  Scilla__________

                    
	 
    	 
    	
                      Name:                      Randy
      Scilla

                    
	 
    	 
    	
                      Title:                      Assistant
      Treasurer

                    
	 
    	 
    	 
    
	 
    	
                      THE
      BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee

                    
	 
    	
                      By:

                    	
                      /s/ Lisa J.
    Jennings__________

                    
	 
    	 
    	
                      Name:                      Lisa
      J. Jennings

                    
	 
    	 
    	
                      Title:                      Vice
      President

                    
	 
    	 
    	 
    

            

          

        

      

    

    

     

     

     

    

    
      
        
          
            Signature Page to
Supplemental Indenture – Senior Secured Notes

            

            

          

           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
A

     

    (Supplemental
Mortgage)

     

    

    

    
      
        
          
             

            

            

            

          

           

        

        
          A-1ex4_2.htm

    EXHIBIT
4.2

     

     

    

      
        	
                 
      

              	
                THE
      TOLEDO EDISON COMPANY

              

      

       

      OFFICER’S
CERTIFICATE

       

      Creating
the

       

      7.25%
SENIOR SECURED NOTES DUE 2020

       

      I, Randy Scilla, the
Assistant Treasurer of The Toledo Edison Company (the “Company”),
pursuant to the authority granted in the resolutions of the Board of Directors
of the Company dated January 22, 2009 and April 22, 2009 and Sections 102, 201
and 301 of the Indenture defined herein, does hereby certify to The Bank of New
York Mellon Trust Company, N.A. (formerly known as The Bank of New York Trust
Company, N.A.), as trustee (the “Trustee”)
under the Indenture of the Company dated as of November 1, 2006 (the “Base
Indenture”), as supplemented and amended by a supplemental indenture
dated as of April 24, 2009 (the “First
Supplemental Indenture” and, together with the Base Indenture, the “Indenture”) that:

       

      
        	
                1.  

              	
                The Securities
      to be issued under the Indenture shall be designated “7.25% Senior Secured
      Notes due 2020” (the “Senior
      Secured Notes”).  The aggregate principal amount of
      Senior Secured Notes shall be limited to $300,000,000.  All
      capitalized terms used in this certificate which are not defined herein
      but are defined in the form of the Senior Secured Notes attached hereto as
      Exhibit A
      shall have the meanings set forth in such Exhibit A; all
      other capitalized terms used in this certificate which are not defined
      herein or in Exhibit A
      hereto but are defined in the Indenture shall have the meanings set forth
      in the Indenture;

              

      

       

      
        	
                2.  

              	
                The Senior
      Secured Notes shall mature and the principal thereof shall be due and
      payable together with all accrued and unpaid interest thereon on May 1,
      2020;

              

      

       

      
        	
                3.  

              	
                The Senior
      Secured Notes shall bear interest as provided in the form of the Senior
      Secured Notes set forth in Exhibit A
      hereto;

              

      

       

      
        	
                4.  

              	
                Each
      installment of interest on the Senior Secured Notes shall be payable as
      provided in the form of the Senior Secured Notes set forth in Exhibit
      A;

              

      

       

      
        	
                5.  

              	
                The principal
      (and premium, if any) and each installment of interest on the Senior
      Secured Notes shall be payable at, and registration of transfers and
      exchanges in respect of the Senior Secured Notes may be effected at, the
      office or agency of the Company in the Borough of Manhattan, The City of
      New York, State of New York or the City of Akron, State of Ohio; provided
      that payment of interest (subject to surrender to the Paying Agent when
      such interest is due at Maturity) may be made at the option of the Company
      by check mailed to the address of the Person entitled thereto or by wire
      transfer to an account at a financial institution in the United States
      designated to the Paying Agent by the Person entitled thereto at least
      fifteen (15) calendar days prior to the related Interest Payment Date; and
      provided further that so long as the Senior Secured Notes are registered
      in the name of The Depository Trust Company (“DTC”),
      or its nominee as discussed below, all payments of principal (and premium,
      if any) and interest in respect of

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      the Senior Secured
Notes will be made in immediately available funds. Notices and demands to or
upon the Company in respect of the Senior Secured Notes and the Indenture may be
served at the office or agency of the Company in The City of New York or the
City of Akron, State of Ohio. The Corporate Trust Office of the Trustee will
initially be the agency of the Company for such payment, registration and
registration of transfers and exchanges and service of notices and demands, and
the Company hereby appoints the Trustee as its agent for all such purposes;
provided, however, that the Company reserves the right to change, by one or more
Officer’s Certificates any such office or agency and such agent.  The
Trustee will be the Security Registrar and the Paying Agent for the Senior
Secured Notes;

       

      
        	
                6.  

              	
                The Senior
      Secured Notes shall be redeemable as provided in the form of the Senior
      Secured Notes set forth in Exhibit A
      hereto;

              

      

       

      
        	
                7.  

              	
                The Senior
      Secured Notes will be issued in minimum denominations of $2,000 and
      integral multiples of $1,000 in excess
thereof;

              

      

       

      
        	
                8.  

              	
                As provided
      for in the Indenture, the Senior Secured Notes will be secured by a series
      of Bonds issued under the Indenture of Mortgage and Deed of Trust, dated
      as of April 1, 1947, between the Company and The Bank of New York Mellon
      Trust Company, N.A., as successor mortgage trustee, as supplemented and
      modified, entitled First Mortgage Bonds, 7.25% Series of 2009 Due 2020
      (the “Bonds of
      7.25% Series”) and delivered by the Company to the Trustee for the
      benefit of the holders of the Senior Secured Notes and such Bonds are
      designated as Bonds of a Specified
Series;

              

      

       

      
        	
                9.  

              	
                The Senior
      Secured Notes shall be initially issued in global form registered in the
      name of Cede & Co. (as nominee for DTC, the initial securities
      depositary); provided, that the Company reserves the right to provide for
      another depositary, registered as a clearing agency under the Securities
      Exchange Act of 1934, as amended (the “Exchange
      Act”), to act as depositary for the global Senior Secured Notes
      (DTC and any such successor depositary, the “Depositary”);
      beneficial interests in the Senior Secured Notes issued in global form may
      not be exchanged in whole or in part for individual certificated Senior
      Secured Notes in definitive form, and no transfer of a global Senior
      Secured Note in whole or in part may be registered in the name of any
      Person other than the Depositary or its nominee except that if, among
      other things, the Depositary (A) has notified the Company that it is
      unwilling or unable to continue as depositary for the global Senior
      Secured Notes or (B) has ceased to be a clearing agency registered under
      the Exchange Act and, in either case, a successor depositary for such
      global Senior Secured Notes has not been appointed by the Company within
      90 days after the Company has received such notice or become aware of such
      cessation, the Company will execute, and the Trustee, upon receipt of a
      Company Order for the authentication and delivery of definitive Senior
      Secured Notes, will authenticate and deliver Senior Secured Notes in
      definitive certificated form in an aggregate principal amount equal to the
      principal amount of the global Senior Secured
  Notes

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      representing such
Senior Secured Notes in exchange for such global Senior Secured Notes, such
definitive Senior Secured Notes to be registered in the names provided by the
Depositary; each global Senior Secured Note (i) shall represent and shall be
denominated in an amount equal to the aggregate principal amount of the
outstanding Senior Secured Notes to be represented by such global Senior Secured
Note (ii) shall be registered in the name of the Depositary or its nominee,
(iii) shall be delivered by the Trustee to the Depositary, its nominee, any
custodian for the Depositary or otherwise pursuant to the Depositary’s
instruction and (iv) shall bear a legend restricting the transfer of such global
Senior Secured Notes to any person other than the Depositary or its nominee;
none of the Company, the Trustee, any Paying Agent or 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 in the global
Senior Secured Notes or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests; the Senior Secured Notes in
global form will contain restrictions on transfer, substantially as described in
the forms set forth in Exhibit A
hereto.  Members of, or participants in, the Depositary (“Agent
Members”) shall have no rights under the Indenture with respect to any
Senior Secured Notes issued in global form held on their behalf by the
Depositary or by a custodian for the Depositary or under such Senior Secured
Note in global form, and the Depositary may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the absolute owner of
such Senior Secured Note in global form 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 the Depositary or impair, as between the Depositary and its Agent
Members, the operation of customary practices of such Depositary governing the
exercise of the rights of a holder of a beneficial interest in any Senior
Secured Note in global form;

       

      
        	
                10.  

              	
                The Trustee,
      the Security Registrar and the Company will have no responsibility under
      the Indenture for transfers of beneficial interests in the Senior Secured
      Notes, any depositary records of beneficial interests or for any
      transactions between the Depositary and beneficial
  owners;

              

      

       

      
        	
                11.  

              	
                No service
      charge shall be made for the registration of transfer or exchange of the
      Senior Secured Notes; provided, however that the Company may require
      payment of a sum sufficient to cover any tax or other governmental charge
      that may be imposed in connection with the exchange or
      transfer;

              

      

       

      
        	
                12.  

              	
                The Senior
      Secured Notes shall have such other terms and provisions as are provided
      in the form set forth in Exhibit A
      hereto, and shall be issued in substantially such
  form;

              

      

       

      
        	
                13.  

              	
                The
      undersigned has read all of the covenants and conditions contained in the
      Indenture relating to the issuance, authentication and delivery of the
      Senior Secured Notes and contained in the Base Indenture relating to the
      execution and

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      delivery by the
Trustee of the First Supplemental Indenture and the definitions in the Indenture
relating thereto and in respect of compliance with which this certificate is
made;

       

      
        	
                14.  

              	
                The statements
      contained in this certificate are based upon the familiarity of the
      undersigned with the Indenture and the documents accompanying this
      certificate, and upon discussions by the undersigned with officers and
      employees of the Company familiar with the matters set forth
      herein;

              

      

       

      
        	
                15.  

              	
                In the opinion
      of the undersigned, he has made such examination or investigation as is
      necessary to enable him to express an informed opinion as to whether or
      not such covenants and conditions have been complied
  with;

              

      

       

      
        	
                16.  

              	
                In the opinion
      of the undersigned, such conditions and covenants and conditions precedent
      (a) provided for in the Indenture (including any covenants compliance with
      which constitutes a condition precedent) relating to the issuance,
      authentication and delivery of the Senior Secured Notes as requested in
      the Company Order; and (b) provided for in the Base Indenture (including
      any covenants compliance with which constitutes a condition precedent)
      relating to the execution and delivery by the Trustee of the First
      Supplemental Indenture have been complied with;
  and

              

      

       

      
        	
                 
      

              	
                        
      17.

              	
                In the opinion
      of the undersigned, in connection with the issuance of the Senior Secured
      Notes and the securing thereof by the Bonds of 7.25% Series, the Company
      having executed and delivered the First Supplemental Indenture and issued
      and delivered to the Trustee its First Mortgage Bonds, 6.15% Series of
      2009 Due 2037 to secure the Company’s existing outstanding $300,000,000
      principal amount of 6.15% Senior Notes Due 2037, the covenant of the
      Company contained in Section 608(a) of the Indenture has been complied
      with.

              

      

       

      

       

      [Signature Page
Follows]

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      

       

      IN WITNESS WHEREOF, I have executed this
Officer’s Certificate this 24th day of
April, 2009.

       

      

       

      /s/ Randy
Scilla__________

      Name:                      Randy
Scilla

      Title:                      Assistant
Treasurer

       

       

      
 

       

      
        
          
            Signature Page to
Officer’s Certificate – Senior Note Indenture

            

            

          

           

        

        
           

          
            

          

        

        
           

        

      

      EXHIBIT
A

       

      FORM OF SENIOR
SECURED NOTE

       

      UNLESS THIS GLOBAL
SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO
THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

       

      
        	
                No.

              	
                R-1

              	
                $300,000,000.00

              
	
                CUSIP
      No.

              	
                889175BE4

              	 
    

      

      THE
TOLEDO EDISON COMPANY

       

      7.25%
SENIOR SECURED NOTE DUE 2020

       

      The Toledo Edison
Company, a corporation duly organized and existing under the laws of the State
of Ohio (herein referred to as the “Company”,
which term includes any successor Person under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to Cede & Co. or
registered assigns, the principal sum of Three Hundred Million Dollars
($300,000,000) on May 1, 2020 (the “Maturity
Date”), and to pay interest on said principal sum, semiannually on May 1
and November 1 of each year beginning on November 1, 2009 (each an “Interest Payment
Date”) at the rate of SEVEN AND TWENTY-FIVE HUNDREDTHS PER CENTUM (7.25%)
per annum until the principal hereof is paid or made available for
payment.  Interest on the Securities of this series will accrue from
April 24, 2009 or from the last Interest Payment Date to which interest has been
paid or duly provided for.  In the event that any Interest Payment
Date is not a Business Day, then payment of 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 such delay) with the same force and
effect as if made on the Interest Payment Date.  The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in such Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be the
Business Day immediately preceding the corresponding Interest Payment Date;
provided, however, that if the Securities of this series are not held by a
securities depositary in book entry only form, the Regular Record Date will be
the close of business on the 15th
calendar day (whether or not a Business Day) next preceding such Interest
Payment Date.  Notwithstanding the foregoing, interest payable at
Maturity shall be paid to the Person to whom principal is
payable.  Any such interest not so punctually paid or duly provided
for will forthwith cease to be payable to the Holder on such

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities of this series
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and
upon such notice as may be required by such exchange, all as more fully provided
in the Indenture referred to on the reverse hereof.

       

      Payment of the
principal of (and premium, if any) and interest on this Security will be made at
the office or agency of the Company maintained for that purpose in The City of
New York, the State of New York, or the City of Akron, State of Ohio, in such
coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts; provided, however, that,
at the option of the Company, interest on this Security (subject to surrender to
the Paying Agent when such interest is due at Maturity) may be paid by check
mailed to the address of the Person entitled thereto, as such address shall
appear on the Security Register or by wire transfer to an account at a financial
institution in the United States designated to the Paying Agent by the Person
entitled thereto at least fifteen (15) calendar days prior to the related
Interest Payment Date; and provided further, that so long as the Securities of
this series are registered at a financial institution in the United States in
the name of The Depository Trust Company or a nominee thereof, all payments of
principal (and premium, if any) and interest in respect of the Securities of
this series will be made in immediately available funds.

       

      Reference is hereby
made to the further provisions of this Security set forth on the reverse hereof,
which further provisions shall for all purposes have the same effect as if set
forth at this place.

       

      Unless the
certificate of authentication hereon has been executed by the Trustee referred
to on the reverse hereof by manual signature, this Security shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      IN WITNESS WHEREOF, The Toledo Edison Company
has caused this instrument to be executed on behalf of the Company by its
Treasurer and attested by its Corporate Secretary.

       

      

      Dated:___________________                     

       

      
        
          	 
    	
                  The Toledo
      Edison Company

                
	 	 
	 
    	
                  By:           _________________________________

                
	 
    	
                  Name:    Randy
      Scilla

                
	 
    	
                  Title:        Assistant
      Treasurer

                
	 ATTEST:	 
    	 
    
	
                   

                	 
    	 
    
	
                  By:       _____________________________

                	 
    	 
    
	
                  Name:  Rhonda
      S. Ferguson

                	 
    	 
    
	
                  Title:    
      Corporate Secretary

                	 
    	 
    
	 
    	 
    	 
    

        

      

      

       

      

       

      

      

      CERTIFICATE
OF AUTHENTICATION

      

      

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

      

      
        	
                The Bank of
      New York Mellon Trust 

                                                                                                                                                   
      Company, N.A.,

                                                                                                                                                   
      as Trustee

              
	
                 

                                                                                                                                                   
      By:           _____________________________

              
	
                                                                                                                                                               
      Authorized Signatory

              
	 
    

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      [REVERSE
OF NOTE]

       

      This Security is one
of a duly authorized issue of securities of the Company (herein called the
“Securities”),
issued and to be issued in one or more series under an Indenture, dated as of
November 1, 2006 (herein, together with any amendments thereto, called the
“Indenture”,
which term shall have the meaning assigned to it in such instrument), between
the Company and The Bank of New York Mellon Trust Company, N.A. (formerly known
as The Bank of New York Trust Company, N.A.), as Trustee (herein called the
“Trustee”,
which term includes any successor trustee under the Indenture), and reference is
hereby made to the Indenture, including the Board Resolutions and Officer’s
Certificate filed with the Trustee on April 24, 2009 creating the series
designated on the face hereof, for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.

       

      Until the Discharge
Date (as hereinafter defined), the Securities of this series will be secured by
a series of first mortgage bonds entitled First Mortgage Bonds, 7.25% Series of
2009 Due 2020 (the “Senior Note Mortgage Bonds”) issued and delivered by the
Company to the Trustee for the benefit of the Holders of the Securities of this
series, issued under the Indenture of Mortgage and Deed of Trust, dated as of
April 1, 1947, from the Company to The Bank of New York Mellon Trust Company,
N.A., as successor trustee (the “Mortgage Trustee”), as supplemented and
modified (collectively, the “Mortgage”).  Reference is made to the
Mortgage and the Indenture for a description of the rights of the Trustee as
holder of the Senior Note Mortgage Bonds, the property mortgaged and pledged,
the nature and extent of the security and the rights of the holders of first
mortgage bonds under the Mortgage and the rights of the Company and of the
Mortgage Trustee in respect thereof, the duties and immunities of the Mortgage
Trustee and the terms and conditions upon which the Senior Note Mortgage Bonds
are secured and the circumstances under which additional first mortgage bonds
may be issued.  As used herein, “Discharge Date” means the date that
all the Senior Note Mortgage Bonds have been retired (whether at, before or
after the maturity thereof) through payment, redemption, purchase, defeasance or
otherwise.

       

      From and after the
Discharge Date, the Senior Note Mortgage Bonds shall cease to secure the
Securities of this series in any manner.  In certain circumstances
prior to the Discharge Date as provided in the Indenture, the Company is
permitted to reduce the aggregate principal amount of the Senior Note Mortgage
Bonds held by the Trustee, but in no event prior to the Discharge Date to an
amount less than the aggregate outstanding principal amount of the Securities of
this series.

       

      The Securities of
this series shall be redeemable, in whole or in part, at the Company’s option,
at any time or from time to time, on at least 30 days, but not more than 60
days, prior notice mailed to the registered address of each Holder of the
Securities of this series to be redeemed at a Redemption Price equal to the
greater of (1) 100% of the principal amount of the Securities to be redeemed and
(2) as determined by the Independent Investment Banker (as defined below), the
sum of the present values of the Remaining Scheduled Payments (as defined below)
discounted to the Redemption Date, on a semiannual basis (assuming a 360-day
year consisting of twelve 30-day months), at a rate equal to the sum of the
Adjusted Treasury Rate (as

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      defined below) and
50 basis points, plus, in each case, accrued and unpaid interest on the
Securities of this series being redeemed to the Redemption
Date.  Notwithstanding the foregoing, the Company may not redeem any
Securities of this series at a Redemption Price in excess of 103% of the
principal amount of such Securities of this series without supplemental state
regulatory approval.  Prior to any redemption of Securities of this
series at a Redemption Price in excess of 103% of the principal amount thereof,
the Company shall deliver to the Trustee an Officer’s Certificate to the effect
that all approvals required by any government authority as a condition to the
redemption of such Securities of this series at a Redemption Price in excess of
103% of the principal amount thereof have been obtained and are in full force
and effect.

       

      “Adjusted Treasury
Rate” means, with respect to any redemption date:

       

      · the yield, under the
heading which represents the average for the immediately preceding week,
appearing in the most recently published statistical release designated
“H.15(519)”, or any successor publication which is published weekly by the Board
of Governors of the Federal Reserve System and which establishes yields on
actively traded United States Treasury securities adjusted to constant maturity
under the caption “Treasury Constant Maturities,” for the maturity corresponding
to the Comparable Treasury Issue (as defined below) (if no maturity is within
three months before or after the Remaining Life (as defined below), yields for
the two published maturities most closely corresponding to the Comparable
Treasury Issue shall be determined and the Adjusted Treasury Rate shall be
interpolated or extrapolated from these yields on a straight line basis,
rounding to the nearest month) or

       

      · if the release (or
any successor release) is not published during the week preceding the
calculation date or does not contain these yields, the rate per annum equal to
the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price (as
defined below) for the Redemption Date.  The Adjusted Treasury Rate
will be calculated on the third Business Day preceding the Redemption
Date.

       

      “Comparable
Treasury Issue” means the United States Treasury security selected by an
Independent Investment Banker as having a maturity comparable to the remaining
term of the Securities of this series to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of such Securities (“Remaining
Life”).

       

      “Comparable
Treasury Price” means with respect to any Redemption Date (a) the average
of four Reference Treasury Dealer Quotations (as defined below) for the
Redemption Date after excluding the highest and lowest Reference Treasury Dealer
Quotations (as defined below), or (b) if the Independent Investment Banker
obtains fewer than four Reference Treasury Dealer Quotations, the average of all
such quotations.

       

      “Independent
Investment Banker” means one of the Reference Treasury Dealers appointed
by the Company, or if such firm is unwilling or unable to select the Comparable
Treasury Issue, an independent investment banking institution of national
standing selected by the Company.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      “Reference
Treasury Dealer” means: (1) each of Credit Suisse Securities (USA) LLC,
Citigroup Global Markets Inc., J.P. Morgan Securities Inc. and Morgan Stanley
& Co. Incorporated, and their respective successors; provided, however, that
if any of the foregoing cease to be a primary U.S. Government securities dealer
in the United States (a “Primary Treasury
Dealer”), the Company will substitute therefor another Primary Treasury
Dealer; and (2) any other Primary Treasury Dealers selected by the Independent
Investment Banker after consultation with the Company.

       

      “Reference
Treasury Dealer Quotations” means, with respect to each Reference
Treasury Dealer and any Redemption Date, the average, as determined by the
Independent Investment Banker, of the bid and asked prices for the Comparable
Treasury Issue (expressed in each case as a percentage of its principal amount)
quoted in writing to the Independent Investment Banker at 5:00 p.m., New York
City time, on the third Business Day preceding the Redemption Date.

       

      “Remaining
Scheduled Payments” means, with respect to the Securities of this series
to be redeemed, the remaining scheduled payments of principal of and interest on
such Securities of this series that would be due after the related Redemption
Date but for such redemption.  If such redemption date is not an
Interest Payment Date with respect to such Securities of this series, the amount
of the next succeeding scheduled interest payment on such Securities of this
series will be reduced (for purposes of this definition) by the amount of
interest accrued on such Securities of this series to such Redemption
Date.

       

      The Company shall
give the Trustee notice of the redemption price promptly after the calculation
thereof and the Trustee shall have no responsibility for such
calculation.

       

      On and after the
redemption date, interest will cease to accrue on the Securities of this series
or any portion of such Securities called for redemption (unless the Company
defaults in the payment of the Redemption Price and accrued interest or in the
case of a conditional redemption, as described below, the Redemption Price and
accrued interest shall not have been received).  On or before the
Redemption Date, the Company will deposit with a Paying Agent (or the Trustee)
money sufficient to pay the Redemption Price of and accrued interest on the
Securities of this series to be redeemed on such date.  If less than
all the Securities of this series are to be redeemed, the Securities of this
series to be redeemed shall be selected by the Trustee, by such method as the
Trustee shall deem fair and appropriate.

       

      Any notice of
redemption of Securities of this series may state that such redemption shall be
conditional upon the receipt by Paying Agent or Agents for the Securities of
this series to be redeemed, on or prior to the date fixed for such redemption,
of money sufficient to pay the Redemption Price of such Securities of this
series 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
Securities of this series.

       

      The Indenture
contains provisions for defeasance at any time of the entire indebtedness of
this Security upon compliance with certain conditions set forth in the
Indenture.

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      If an Event of
Default with respect to Securities of this series shall occur and be continuing,
the principal of the Securities of this series may be declared due and payable
in the manner and with the effect provided in the Indenture.

       

      The Indenture
permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of
the Holders of the Securities of each series to be affected under the Indenture
at any time by the Company and the Trustee with the consent of the Holders of a
majority in principal amount of the Securities at the time Outstanding of all
series to be affected.  The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences.  Any such consent or waiver by the Holder of this
Security shall be conclusive and binding upon such Holder and upon all future
Holders of this Security and of any Security issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.

       

      As provided in and
subject to the provisions of the Indenture, the Holder of this Security shall
not have the right to institute any proceeding with respect to the Indenture or
for the appointment of a receiver or trustee or for any other remedy thereunder,
unless such Holder shall have previously given the Trustee written notice of a
continuing Event of Default with respect to the Securities of this series, the
Holders of a majority in aggregate principal amount of the Securities of all
series at the time Outstanding in respect of which an Event of Default shall
have occurred and be continuing shall have made written request to the Trustee
to institute proceedings in respect of such Event of Default as Trustee and
offered the Trustee reasonable indemnity, and the Trustee shall not have
received from the Holders of a majority in aggregate principal amount of
Securities of all series at the time Outstanding in respect of which an Event of
Default shall have occurred and be continuing a direction inconsistent with such
request, and shall have failed to institute any such proceeding, for 60 days
after receipt of such notice, request and offer of indemnity.  The
foregoing shall not apply to any suit instituted by the Holder of this Security
for the enforcement of any payment of principal hereof or any premium or
interest hereon on or after the respective due dates expressed or provided for
herein.

       

      No reference herein
to the Indenture and no provision of this Security or of the Indenture shall
alter or impair the obligation of the Company, which is absolute and
unconditional, to pay the principal of and any premium and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.

       

      The Indenture and
the Securities of this series shall be governed by and construed in accordance
with the laws of the State of New York.

       

      The Securities of
this series are issuable only in registered form without coupons in
denominations of $2,000 and integral multiples of $1,000 in excess
thereof.  As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
and of authorized denominations, as requested by the Holder surrendering the
same.

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

       As provided in
the Indenture and subject to certain limitations therein set forth, the transfer
of this Security is registrable in the Security Register, upon surrender of this
Security for registration of transfer at the office or agency of the Company for
such purpose, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar and duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities of this series, of authorized denominations
and of like tenor and for the same aggregate principal amount, will be issued to
the designated transferee or transferees.  No service charge shall be
made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.

       

      Prior to due
presentment of this Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Security is registered as the absolute owner hereof for all
purposes (except as provided in Section 308 of the Indenture), whether or not
this Security be overdue, and neither the Company, the Trustee nor any such
agent shall be affected by notice to the contrary.

       

      All terms used in
this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.

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