Document:

First Supplemental Indenture

    Exhibit
      10.1

     

     

     

      
        

      

    

    

      COMMONWEALTH
        TELEPHONE ENTERPRISES, INC.,

       

      

       

      CITIZENS
        COMMUNICATIONS COMPANY

       

       

      AND

       

       

      THE
        BANK
        OF NEW YORK

       

      as
        Trustee

       

      ____________________

       

      First
        Supplemental Indenture

       

      Dated
        as
        of March 8, 2007

       

      ___________________

       

       

      31⁄4%
        Convertible Notes due 2023

       

      

       

      

       

        
          

        

      

      

       

      

       

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      FIRST
        SUPPLEMENTAL INDENTURE dated as of March 8, 2007 (the “First
        Supplemental Indenture”)
        among
        COMMONWEALTH TELEPHONE ENTERPRISES, INC., a Pennsylvania corporation (the
        “Company”),
        CITIZENS COMMUNICATIONS COMPANY, a Delaware corporation (“Citizens”
or
        in
        its capacity as guarantor, the “Guarantor”),
        and
        THE BANK OF NEW YORK, a New York banking corporation, as Trustee (the
“Trustee”).

       

      RECITALS
        OF THE COMPANY

      

      WHEREAS,
        the Company and the
        Trustee
        have
        heretofore executed and delivered the Indenture dated as of July 18, 2003
        (the
“Base
        Indenture”)
        relating to the Company’s 31⁄4% Convertible Notes due 2023 (each a “Note”
and
        collectively, the “Notes”);

       

      WHEREAS,
        the Company has entered into the Agreement and Plan of Merger dated as of
        September 17, 2006 (the “Merger
        Agreement”)
        among
        the Company, Citizens and CF Merger Corp., a wholly owned subsidiary of Citizens
        (“Merger
        Subsidiary”),
        pursuant to which Merger Subsidiary will be merged with and into the Company
        (the “Merger”),
        whereupon the separate existence of Merger Subsidiary shall cease, and the
        Company shall be the surviving corporation and become a wholly owned subsidiary
        of Citizens;

       

      WHEREAS,
        pursuant to the Merger Agreement, at the effective time of the Merger (the
        “Effective
        Time”),
        each
        share of the Company’s outstanding common stock, par value $1.00 per share (the
“Common
        Shares”),
        shall
        be converted into the right to receive 0.768 shares of common stock, par
        value
        $0.25 per share, of Citizens (“Citizens’
        Stock”)
        and
        $31.31 in cash, without interest (collectively, the “Merger
        Consideration”);

       

      WHEREAS,
        Section 12.01 of the Base Indenture provides that the Company shall only
        consolidate or merge with or into any other Person or Persons (whether or
        not
        affiliated with the Company) upon certain terms and upon the satisfaction
        of
        certain conditions specified therein;

       

      WHEREAS,
        pursuant to Section 15.06 of the Base Indenture, following the consummation
        of
        the Merger, the Company and Citizens shall execute with the Trustee a
        supplemental indenture, which shall provide for the conversion and settlement
        of
        the Notes as set forth in the Base Indenture;

       

      WHEREAS,
        Section 11.01(a) of the Base Indenture provides that the Company, when
        authorized by the resolutions of the Board of Directors, and the Trustee
        may,
        from time to time, and at any time, without the consent of any Noteholders,
        enter into an indenture or indentures supplemental thereto to make provisions
        with respect to the conversion rights of the Noteholders pursuant to the
        requirements of Section 15.06 of the Base Indenture and the repurchase
        obligations of the Company pursuant to the requirements of Section 3.05(e)
        of
        the Base Indenture;

       

       

      
        
          
          

        

        
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      WHEREAS,
        pursuant to Section 11.05 of the Base Indenture, the Trustee was provided
        with
        an Officers’ Certificate and an Opinion of Counsel as conclusive evidence that
        this First Supplemental Indenture complies with the requirements of Article
        11
        of the Base Indenture and is otherwise authorized or permitted by the Base
        Indenture; and

       

      WHEREAS,
        all things necessary to make this First Supplemental Indenture a valid agreement
        of the Company, Citizens and the Trustee, and a valid supplement to the Base
        Indenture, have been done.

       

      NOW,
        THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:

       

      For
        and
        in consideration of the premises, the parties hereby mutually agree, for
        the
        benefit of the Company and the equal and proportionate benefit of all
        Noteholders, as follows:

       

       

      ARTICLE 1 

      Authorization;
        Definitions

       

      Section
        1.01.  First
        Supplemental Indenture.
        This
        First Supplemental Indenture is supplemental to, and is entered into in
        accordance with Section 11.01 of the Base Indenture, and except as modified,
        amended and supplemented by this First Supplemental Indenture, the provisions
        of
        the Base Indenture are in all respects ratified and confirmed and shall remain
        in full force and effect.

       

      Section
        1.02.  Capitalized
        Terms. Capitalized
        terms used herein but not defined shall have the meanings assigned to them
        in
        the Base Indenture.

       

       

      ARTICLE
        2

      Amendments
        To The Base Indenture

       

      Section
        2.01.  Amendments
        To The Base Indenture. The
        Base
        Indenture is hereby amended in the following manner:

       

      (a)  The
        following definitions shall be added to Section 1.01 of the Base
        Indenture:

       

      “Citizens”
means
        Citizens Communications Company.

       

      “First
        Supplemental Indenture”
means
        the First Supplemental Indenture dated as of March 8, 2007 among the Company,
        Citizens, and the Trustee.

       

      “Per
        Note Unit Value”
means,
        on any date and with respect to each $1,000 principal amount of Note, the
        sum of
        (i) $804.84 in cash, without interest, and (ii) the product of (x) 0.768
        shares
        of Citizens’ common stock, par value $0.25 per share (“Citizens’
        Stock”),
        (y)
        the Conversion Rate then in effect and (z) the Closing Sale Price of Citizens’
Stock on such date. 

       

       

      
        
          
          

        

        
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      “Per
        Share Unit Value”
means,
        on any date, the sum of (i) 0.768 shares of Citizens’ Stock multiplied by the
        Closing Sale Price of Citizens’ Stock on such date and (ii) $31.31 in cash,
        without interest; provided
        that, if
        the Conversion Rate is adjusted, the 0.768 amount (as it may previously have
        been adjusted) shall be adjusted by the same percentage amount as the adjustment
        to the Conversion Rate.

       

      “Unit”
means,
        on any date of determination and with respect to each $1,000 principal amount
        of
        Notes, (i) 0.768 shares of Citizens’ Stock multiplied by the Conversion Rate
        then in effect and (ii) $804.84 in cash, without interest.

       

      (b)  The
        definition of “Common Stock” in Section 1.01 of the Base Indenture shall be
        amended, effective as of the Effective Time of the Merger, by replacing it
        in
        its entirety with the following:

       

      “Common
        Stock”
means
        any stock of any class of Citizens which has no preference in respect of
        dividends or of amounts payable in the event of any voluntary or involuntary
        liquidation, dissolution or winding up of Citizens and which is not subject
        to
        redemption by Citizens. Subject to the provisions of Section 15.06,
        however, shares issuable on conversion of Notes shall include only shares
        of the
        class designated as common stock of Citizens at the date of the First
        Supplemental Indenture (namely, Citizens’ common stock, par value $0.25 per
        share) or shares of any class or classes resulting from any reclassification
        or
        reclassifications thereof and which have no preference in respect of dividends
        or of amounts payable in the event of any voluntary or involuntary liquidation,
        dissolution or winding up of Citizens and which are not subject to redemption
        by
        Citizens;
        provided
        that if
        at any time there shall be more than one such resulting class, the shares
        of
        each such class then so issuable on conversion shall be substantially in
        the
        proportion which the total number of shares of such class resulting from
        all
        such reclassifications bears to the total number of shares of all such classes
        resulting from all such reclassifications.

       

      (c)  Paragraph
        (d) of the definition of “Outstanding” in Section 1.01 of the Base Indenture
        shall be amended by deleting the phrase “into Common Stock”.

       

      (d)  Section
        3.05(e) of the Base Indenture shall be amended by replacing it in its entirety
        with the following:

       

       

      
        
          
          

        

        
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      “(e) In
        the
        case of a reclassification, change, consolidation, merger, combination, sale
        or
        conveyance to which Section 15.06 applies, in which the Common Stock is changed
        or exchanged as a result into the right to receive stock, securities or other
        property or assets (including cash), which includes shares of Common Stock
        or
        shares of common stock of another Person that are, or upon issuance will
        be,
        traded on a United States national securities exchange or approved for trading
        on an established automated over-the-counter trading market in the United
        States
        and such shares constitute at the time such change or exchange becomes effective
        in excess of 50% of the aggregate Fair Market Value of such stock, securities
        or
        other property or assets (including cash) (as determined by the Company,
        which
        determination shall be conclusive and binding), then the Person formed by
        such
        consolidation or resulting from such merger or which acquires such assets,
        as
        the case may be, shall execute and deliver to the Trustee a supplemental
        indenture (accompanied by an Opinion of Counsel that such supplemental indenture
        complies with the Trust Indenture Act as in force at the date of execution
        of
        such supplemental indenture) modifying the provisions of this Indenture relating
        to the right of holders of the Notes to cause the Company to repurchase the
        Notes following a Designated Event, including without limitation the applicable
        provisions of this Section 3.05 and the definitions of Common Stock and
        Designated Event, as appropriate, as determined in good faith by the Company
        (which determination shall be conclusive and binding), to make such provisions
        apply to such other Person if different from Citizens and the common stock
        issued by such Person (in lieu of Citizens and the Common Stock of
        Citizens).”

       

       

      (e)  Section
        15.01 of the Base Indenture shall be amended by replacing it in its entirety
        with the following:

       

      “Section
        15.01. Right
        To Convert.
        (a) Subject to and upon compliance with the provisions of this Indenture,
        prior to July 15, 2023, the holder of any Note shall have the right, at
        such holder’s option, to convert the principal amount of the Note, or any
        portion of such principal amount which is a multiple of $1,000, into cash
        and
        fully paid and non-assessable shares of Common Stock (as such shares shall
        then
        be constituted) constituting a Unit (the “Conversion
        Obligation”),
        by
        surrender of the Note so to be converted in whole or in part, together with
        any
        required funds, under the circumstances described in this Section 15.01 and
        in
        the manner provided in Section 15.02. The Notes shall be convertible only
        upon
        the occurrence of one of the following events:

       

      (i)  during
        any Fiscal Quarter (and only during such Fiscal Quarters) commencing after
        September 30, 2003, if the Per Share Unit Value exceeds 120% of the
        then-effective Conversion Price for at least 20 Trading Days in the
        30 consecutive Trading Day period ending on the last Trading Day of the
        immediately preceding Fiscal Quarter (it being understood for purposes of
        this
        Section 15.01(a)(i) that the Conversion Price in effect at the close of business
        on each of the 30 consecutive Trading Days should be used);

       

       

      
        
          
          

        

        
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      (ii)  during
        the five Business Day period immediately following any five consecutive Trading
        Day period (the “Measurement
        Period”)
        in
        which the Trading Price per $1,000 principal amount of the Notes for each
        day of
        such Measurement Period was less than 98% of the Per Note Unit Value on such
        date;
        provided
        that
no
        conversion pursuant to this clause (ii)
        may be made after July 15, 2018, if on any Trading Day during the
        Measurement Period, the Per Share Unit Value is more than 100%, but less
        than
        120% of the Conversion Price on such Trading Day;

       

      (iii)  if
        such
        Note has been called for redemption, at any time on or after the date the
        notice
        of redemption has been given until the close of business on the second Business
        Day immediately preceding the redemption date; or

       

      (iv)  as
        provided in Section (b) of this Section 15.01.

       

      The
        Trustee (or other conversion agent appointed by the Company) shall, on behalf
        of
        the Company, determine on a daily basis during the time period specified
        in
        Section 15.01(a)(i) whether the Notes shall be convertible as a result of
        the
        occurrence of an event specified in clause (i) above and, if the Notes
        shall be so convertible, the Trustee (or other conversion agent appointed
        by the
        Company) shall promptly deliver to the Company and the Trustee (if the Trustee
        is not the conversion agent) written notice thereof. Whenever the Notes shall
        become convertible pursuant to this Section 15.01, the Company or, at the
        Company’s request, the Trustee in the name and at the expense of the Company,
        shall notify the holders of the event triggering such convertibility in the
        manner provided in Section 16.03, and the Company shall also publicly announce
        such information and publish it on the Company’s web site. Any notice so given
        shall be conclusively presumed to have been duly given, whether or not the
        holder receives such notice.

       

      The
        Trustee (or other conversion agent appointed by the Company) shall have no
        obligation to determine the Trading Price under this Section 15.01 unless
        the
        Company has requested such a determination; and the Company shall have no
        obligation to make such request unless a holder provides it with reasonable
        evidence that the Trading Price per $1,000 principal amount of Notes would
        be
        less than 98% of the Per Note Unit Value. If such evidence is provided, the
        Company shall instruct the Trustee (or other conversion agent) to determine
        the
        Trading Price of the Notes beginning on the next Trading Day and on each
        successive Trading Day until the Trading Price per $1,000 principal amount
        of
        Notes is greater than or equal to 98% of the Per Note Unit Value; provided
        that the
        Trustee shall be under no duty or obligation to make the calculations described
        in Section 15.01(a)(ii) hereof or to determine whether the Notes are convertible
        pursuant to such section. For the avoidance of doubt, the Company shall make
        the
        calculations described in Section 15.01(a)(ii), using the Trading Price provided
        by the Trustee.

       

       

      
        
          
          

        

        
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      The
        Trustee shall be entitled at its sole discretion to consult with the Company
        and
        to request the assistance of the Company in connection with the Trustee’s duties
        and obligations pursuant to Section 15.01(a)(i) and Section 15.01(a)(ii)
        hereof
        (including without limitation the calculation or determination of the Conversion
        Price, the Closing Sale Price and the Trading Price), and the Company agrees,
        if
        requested by the Trustee, to cooperate with, and provide assistance to, the
        Trustee in carrying out its duties under this Section 15.01; provided
        that
        nothing herein shall be construed to relieve the Trustee of its duties pursuant
        to Section 15.01(a)(i) and Section 15.01(a)(ii) hereof.

       

       

      (b) In
        addition, if:

       

      (i)  (A) Citizens
        distributes to all holders of its Common Stock rights or warrants entitling
        them
        (for a period expiring within 45 days of the record date for the determination
        of the stockholders entitled to receive such distribution) to subscribe for
        or
        purchase shares of Common Stock, at a price per share less than the average
        of
        the Closing Sale Price of the Common Stock for the ten Trading Days immediately
        preceding, but not including, the date such distribution is first publicly
        announced by the Company, or (B) Citizens distributes to all holders of its
        Common Stock, cash or other assets, debt securities or rights to purchase
        its
        securities, where the Fair Market Value of such distribution per share of
        Common
        Stock exceeds 5% of the Closing Sale Price of the Common Stock on the Trading
        Day immediately preceding the date such distribution is first publicly announced
        by Citizens, then, in either case, the Notes may be surrendered for conversion
        at any time on and after the date that Citizens gives notice to the holders
        of
        such distribution, which shall be not less than 20 days prior to the
        Ex-Dividend Time for such distribution, until the earlier of the close of
        business on the second Business Day immediately preceding, but not including,
        the Ex-Dividend Time or the date Citizens publicly announces that such
        distribution will not take place;
        provided
        that if
        the holder will otherwise participate in such distribution without conversion
        (as if such holder had held a number of shares equal to the Conversion Rate
        multiplied by 0.768), neither any adjustment to the Conversion Rate will
        be made
        nor will a holder of a Note have the ability to convert pursuant to this
        Section
        15.01(b); or

       

      (ii)  Citizens
        consolidates with or merges with or into another Person or is a party to
        a
        binding share exchange or conveys, transfers, sells, leases or otherwise
        disposes of all or substantially all of its properties and assets in each
        case
        pursuant to which the Common Stock is converted into cash, securities or
        other
        property, then the Notes may be surrendered for conversion at any time from
        and
        after the date fifteen (15) days prior to the anticipated effective date of
        the transaction and ending on and including the date fifteen (15) days
        after the consummation of the transaction. If such transaction constitutes
        a
        Designated Event, the Notes may be surrendered for conversion until the
        corresponding Designated Event Repurchase Date. In such an event, a holder
        of
        Notes may elect to exercise its option to require the Company to repurchase
        all
        or a portion of such holder’s Notes pursuant to Section 3.05. The Board of
        Directors shall determine the anticipated effective date of the transaction,
        and
        such determination shall be conclusive and binding on the holders and shall
        be
        publicly announced by the Company and posted on its web site not later than
        two
        Business Days prior to such 15th day.
        

       

       

      
        
          
          

        

        
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      “Ex-Dividend
        Time”
means,
        with respect to any distribution on shares of Common Stock, the first date
        on
        which the shares of Common Stock trade regular way on the principal securities
        market on which the shares of Common Stock are then traded without the right
        to
        receive such distribution. 

       

      Notwithstanding
        anything to the contrary in this Article 15, the proposed reclassification
        and conversion of the outstanding class B common stock of the Company into
        Common Stock in accordance with the Recapitalization Agreement (the
“Recapitalization
        Transaction”),
        will
        not trigger any conversion rights for any holder of Notes.

       

      (c) A
        Note in
        respect of which a holder is electing to exercise its option to require the
        Company to repurchase such holder’s Notes upon a Designated Event pursuant to
        Section 3.05, or at the option of the holder pursuant to Section 3.06, may
        be converted only if such holder withdraws its election in accordance with
        Section 3.05(c) or Section 3.08, respectively. A holder of Notes is not entitled
        to any rights of a holder of Common Stock until such holder has converted
        his
        Notes to Units and only to the extent such Notes are deemed to have been
        converted to Common Stock under this Article 15.”

       

      
        (f)  The
          third
          paragraph of Section 15.02 of the Base Indenture shall be amended by replacing
          it in its entirety with the following:

      

       

      “As
        promptly as practicable after satisfaction of the requirements for conversion
        set forth above, subject to compliance with any restrictions on transfer
        if
        shares issuable on conversion are to be issued in a name other than that
        of the
        Noteholder (as if such transfer were a transfer of the Note or Notes (or
        portion
        thereof) so converted), the Company shall deliver to such Noteholder at the
        office or agency maintained by the Company for such purpose pursuant to Section
        5.02, for each $1,000 principal amount of Note, the cash and number of full
        shares of Common Stock (and cash in respect of any fractional interest in
        respect of a share of Common Stock arising upon such conversion, calculated
        by
        the Company as provided in Section 15.03) then constituting a Unit on such
        Conversion Date. In case any Note of a denomination greater than $1,000 shall
        be
        surrendered for partial conversion, and subject to Section 2.03, the Company
        shall execute and the Trustee shall authenticate and deliver to the holder
        of
        the Note so surrendered, without charge to him, a new Note or Notes in
        authorized denominations in an aggregate principal amount equal to the
        unconverted portion of the surrendered Note.”

       

       

      
        
          
          

        

        
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        (g)  The
          seventh and eighth paragraphs of Section 15.02 of the Base Indenture shall
          be
          amended by replacing them in their entirety with the
          following:

      

       

      “Upon
        the
        conversion of a Note, that portion of the accrued but unpaid Interest, including
        accrued Contingent Interest, if any, and Additional Interest, if any, to
        the
        Conversion Date, with respect to the converted Note shall not be cancelled,
        extinguished or forfeited, but rather shall be deemed to be paid in full
        to the
        holder thereof through delivery of the cash and the Common Stock (together
        with
        the cash payment, if any in lieu of fractional shares) in exchange for the
        Note
        being converted pursuant to the provisions hereof; and the cash and the Fair
        Market Value of such shares of Common Stock (together with any such cash
        payment
        in lieu of fractional shares) shall be treated as delivered, to the extent
        thereof, first in exchange for and in satisfaction of our obligation to pay
        the
        principal amount of the converted Note, the accrued but unpaid Interest,
        including Contingent Interest, if any, and Additional Interest, if any, through
        the Conversion Date and the balance, if any, of such cash and the Fair Market
        Value of such Common Stock (and any such cash payment) shall be treated as
        delivered in exchange for and in satisfaction of the right to convert the
        Note
        being converted pursuant to the provisions hereof.

       

      The
        Company agrees, and by acceptance of a beneficial interest in a Note each
        holder
        and any beneficial owner of a Note shall be deemed to have agreed to treat,
        for
        United States federal income tax purposes, the cash and the Fair Market Value
        of
        the Common Stock received upon a conversion of the Note (together with any
        cash
        payment in lieu of fractional shares) as a contingent payment on the Note
        for
        purposes of Treasury Regulation Section 1.1275-4 or any successor
        provision.”

       

      
        (h)  Section
          15.04 of the Base Indenture shall be amended by replacing it in its entirety
          with the following:

      

       

      “Section
        15.04.
        Conversion Rate.
        Each
        $1,000 principal amount of the Notes shall be convertible at a rate specified
        in
        the form of Note (herein called the “Conversion
        Rate”)
        attached as Exhibit A hereto, subject to adjustment as provided in this Article
        15.”

       

      
        (i)  The
          first
          paragraph of Section 15.06 of the Base Indenture shall be amended by replacing
          it in its
          entirety with the following:

      

       

       

      
        
          
          

        

        
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      “Section
        15.06.
        Effect Of Reclassification, Consolidation, Merger or Sale.
        If
        any of
        the following events occur, namely (i) any reclassification or change of
        the
        outstanding shares of Common Stock (other than (x) a subdivision or
        combination to which Section 15.05(c) applies and (y) the Recapitalization
        Transaction), (ii) any consolidation, merger or combination of Citizens with
        another Person as a result of which holders of Common Stock shall be entitled
        to
        receive stock, other securities or other property or assets (including cash)
        with respect to or in exchange for such Common Stock, or (iii) any sale or
        conveyance of all or substantially all of the properties and assets of Citizens
        to any other Person as a result of which holders of Common Stock shall be
        entitled to receive stock, other securities or other property or assets
        (including cash) with respect to or in exchange for such Common Stock, then
        the
        Company and Citizens or the successor or purchasing Person, as the case may
        be,
        shall execute with the Trustee a supplemental indenture (which shall comply
        with
        the Trust Indenture Act as in force at the date of execution of such
        supplemental indenture) providing that each $1,000 principal amount Note
        shall
        be convertible into (i) $804.84 in cash, without interest, and (ii) the kind
        and
        amount of shares of stock, other securities or other property or assets
        (including cash) or any combination thereof receivable upon such
        reclassification, change, consolidation, merger, combination, sale or conveyance
        by a holder of Common Stock holding, immediately prior to the transaction,
        a
        number of shares of Common Stock equal to the Conversion Rate immediately
        prior
        to such transaction multiplied by 0.768, assuming such holder of Common Stock
        did not exercise his rights of election, if any, as to the kind or amount
        of
        stock, other securities or other property or assets (including cash) receivable
        upon such reclassification, change, consolidation, merger, combination, sale
        or
        conveyance (provided
        that, if
        the kind or amount of stock, other securities or other property or assets
        (including cash) receivable upon such reclassification, change, consolidation,
        merger, combination, sale or conveyance is not the same for each share of
        Common
        Stock in respect of which such rights of election shall not have been exercised
        (“non-electing
        share”),
        then
        for the purposes of this Section 15.06 the kind and amount of stock, other
        securities or other property or assets (including cash) receivable upon such
        reclassification, change, consolidation, merger, combination, sale or conveyance
        for each non-electing share shall be deemed to be the kind and amount so
        receivable per share by a plurality of the non-electing shares). Such
        supplemental indenture shall provide for adjustments which shall be as nearly
        equivalent as may be practicable to the adjustments provided for in this
        Article
        15.”

       

      
        (j)  Section
          15.09 of the Base Indenture shall be amended by replacing it in its entirety
          with the following:

      

       

      “Section
        15.09.
        Responsibility Of Trustee.
        The
        Trustee and any other conversion agent shall not at any time be under any
        duty
        or responsibility to any holder of Notes to determine the Conversion Rate
        or
        whether any facts exist which may require any adjustment of the Conversion
        Rate,
        or with respect to the nature or extent or calculation of any such adjustment
        when made, or with respect to the method employed, or herein or in any
        supplemental indenture provided to be employed, in making the same. The Trustee
        and any other conversion agent shall not be accountable with respect to the
        validity or value (or the kind or amount) of any shares of Common Stock,
        or of
        any securities or property, which may at any time be issued or delivered
        upon
        the conversion of any Note; and the Trustee and any other conversion agent
        make
        no representations with respect thereto. Neither the Trustee nor any conversion
        agent shall be responsible for any failure of the Company and Citizens to
        issue,
        transfer or deliver any shares of Common Stock or stock certificates or other
        securities or property or cash upon the surrender of any Note for the purpose
        of
        conversion or to comply with any of the duties, responsibilities or covenants
        of
        the Company and Citizens contained in this Article 15. Without limiting the
        generality of the foregoing, neither the Trustee nor any conversion agent
        shall
        be under any responsibility to determine the correctness of any provisions
        contained in any supplemental indenture entered into pursuant to Section
        15.06
        relating either to the kind or amount of shares of stock or securities or
        property (including cash) receivable by Noteholders upon the conversion of
        their
        Notes after any event referred to in such Section 15.06 or to any adjustment
        to
        be made with respect thereto, but, subject to the provisions of Section 8.01,
        may accept as conclusive evidence of the correctness of any such provisions,
        and
        shall be protected in relying upon, the Officers’ Certificate (which the Company
        shall be obligated to file with the Trustee prior to the execution of any
        such
        supplemental indenture) with respect thereto.”

       

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

       

      
        (k)  Sections
          15.08, 15.10 and 15.11 of the Base Indenture shall be amended such that
          references to “the Company” shall mean “Citizens”.

      

       

       

      ARTICLE
        3

      Base
        Indenture Obligations

       

      Section
        3.01.  Reaffirmation
        Of Obligations. Pursuant
        to Section 12.01(ii) of the Base Indenture, the Company hereby reaffirms
        its
        obligations under the Base Indenture to pay the principal of and Interest
        on all
        of the Notes, according to their tenor, and to perform and observe all of
        the
        covenants and conditions contained in the Base Indenture to be performed
        by the
        Company.

       

       

      ARTICLE
        4

      Merger-related
        Mechanics

       

      Section
        4.01.  Conversion
        Mechanics. For
        the
        avoidance of doubt, the amendments herein to Sections 15.01 of the Base
        Indenture shall not nullify elections to convert Notes made before the Effective
        Time of the Merger.

       

      Section
        4.02.  Repurchase
        and Conversion Upon Designated Event. For
        the
        avoidance of doubt, notwithstanding the provisions herein, the Merger shall
        constitute a “Designated Event” under the Base Indenture. Each Noteholder’s
        right to require the Company to repurchase all of such holder’s Notes (or any
        portion thereof that is a multiple of $1,000 principal amount) as a result
        of
        the Merger, pursuant to Section 3.05 of the Base Indenture, shall survive,
        notwithstanding this First Supplemental Indenture. Furthermore, each
        Noteholder’s right to convert such holder’s Notes until the Designated Event
        Repurchase Date related to the Merger, pursuant to Section 15.01(b)(ii) of
        the
        Base Indenture, shall survive, notwithstanding this First Supplemental
        Indenture, provided
        that the
        cash and Common Stock deliverable in respect of any Notes so tendered for
        conversion will be determined as provided in the Base Indenture as amended
        by
        this First Supplemental Indenture.

       

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

       

      ARTICLE
        5

      Conversion
        Rate Adjustments

       

      Section
        5.01.  Conversion
        Rate. Effective
        as of the date hereof, the Conversion Rate shall be adjusted from time to
        time
        by the Company upon the occurrence of an event with respect to Citizens which
        would have required an adjustment to the Conversion Rate pursuant to Section
        15.05 of the Base Indenture if such event had occurred with respect to the
        Company prior to the Merger in a manner equivalent to the adjustment to the
        Conversion Rate which would have been required pursuant to Article 15 of
        the
        Base Indenture if such event had occurred with respect to the Company prior
        to
        the Merger. For the avoidance of doubt, effective as of the date hereof,
        the
        Conversion Rate shall not be adjusted upon the occurrence of an event with
        respect to the Company which would have required an adjustment to the Conversion
        Rate pursuant to Section 15.05 of the Base Indenture if such event had occurred
        prior to the date hereof.

       

       

      ARTICLE
        6

      Guarantee
        of
        Citizens

       

      Section
        6.01.  Guarantee.
        By
        its
        execution hereof, the Guarantor acknowledges and agrees that it receives
        substantial benefits from the Company and that the Guarantor is providing
        its
        Guarantee for good and valuable consideration, including, without limitation,
        such substantial benefits. Accordingly, subject to the provisions of this
        Article
        6,
        the
        Guarantor hereby unconditionally guarantees to each Holder of a Note
        authenticated and delivered (whether before or after the date of this First
        Supplemental Indenture) by the Trustee and its successors and assigns that:
        (i)
        the principal of (including the redemption price or repurchase price upon
        redemption or repurchase pursuant to Article
        3
        of the Base Indenture),
        and
        interest and Additional Interest, if any, on the Notes shall be duly and
        punctually paid in full when due, whether at the maturity date of the Notes,
        upon acceleration, upon redemption, upon a repurchase, upon repurchase due
        to a
        Designated Event or otherwise, and interest on overdue principal, Additional
        Interest, if any, and (to the extent permitted by law) interest on any interest,
        if any, on the Notes and all other obligations of the Company to the Holders
        (including, without limitation, in connection with a conversion of Notes)
        or the
        Trustee hereunder or under the Notes (including fees, expenses or other)
        shall
        be promptly paid in full or performed, all in accordance with the terms hereof;
        and (ii) in case of any extension of time of payment or renewal of any Notes
        or
        any of such other obligations, the same shall be promptly paid in full when
        due
        or performed in accordance with the terms of the extension or renewal, whether
        at the maturity date of the Notes, by acceleration, call for redemption,
        upon
        repurchase, upon repurchase due to a Designated Event or otherwise, subject,
        however, in the case of clauses (i) and (ii) above, to the limitations set
        forth
        in Section
        6.03
        hereof
        (collectively, the “Guarantee
        Obligations”).

       

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      Subject
        to the provisions of this Article
        6,
        the
        Guarantor hereby agrees that its Guarantee hereunder shall be unconditional,
        irrespective of the validity, regularity or enforceability of the Notes or
        the
        Base Indenture (as amended by this First Supplemental Indenture), the absence
        of
        any action to enforce the same, any waiver or consent by any Holder of the
        Notes
        with respect to any thereof, the entry of any judgment against the Company,
        any
        action to enforce the same or any other circumstance which might otherwise
        constitute a legal or equitable discharge or defense of the Guarantor. The
        Guarantor hereby waives and relinquishes: (a) any right to require the Trustee,
        the Holders or the Company (each, a “Benefited
        Party”)
        to
        proceed against the Company or any other Person or to proceed against or
        exhaust
        any security held by a Benefited Party at any time or to pursue any other
        remedy
        in any secured party’s power before proceeding against the Guarantor; (b) any
        defense that may arise by reason of the incapacity, lack of authority, death
        or
        disability of any other Person or Persons or the failure of a Benefited Party
        to
        file or enforce a claim against the estate (in administration, bankruptcy
        or any
        other proceeding) of any other Person or Persons; (c) demand, protest and
        notice
        of any kind (except as expressly required by this Indenture), including but
        not
        limited to notice of the existence, creation or incurring of any new or
        additional indebtedness or obligation or of any action or non-action on the
        part
        of the Guarantor, the Company, any Benefited Party, any creditor of the
        Guarantor or the Company or on the part of any other Person whomsoever in
        connection with any obligations the performance of which are hereby guaranteed;
        (d) any defense based upon an election of remedies by a Benefited Party,
        including but not limited to an election to proceed against the Guarantor
        for
        reimbursement; (e) any defense based upon any statute or rule of law which
        provides that the obligation of a surety must be neither larger in amount
        nor in
        other respects more burdensome than that of the principal; (f) any defense
        arising because of a Benefited Party’s election, in any proceeding instituted
        under the Bankruptcy Law, of the application of Section 1111(b)(2) of the
        Bankruptcy Code; and (g) any defense based on any borrowing or grant of a
        security interest under Section 364 of the Bankruptcy Code. The Guarantor
        hereby
        covenants that, except as otherwise provided therein, the Guarantee shall
        not be
        discharged except by payment in full of all Guarantee Obligations, including
        the
        principal and interest on the Notes and all other costs provided for under
        the
        Base Indenture (as amended by this First Supplemental Indenture).

       

      If
        any
        Holder or the Trustee is required by any court or otherwise to return to
        either
        the Company or the Guarantor, or any trustee or similar official acting in
        relation to either the Company or the Guarantor, any amount paid by the Company
        or the Guarantor to the Trustee or such Holder, the Guarantee, to the extent
        theretofore discharged, shall be reinstated in full force and effect. The
        Guarantor agrees that it shall not be entitled to any right of subrogation
        in
        relation to the Holders in respect of any Guarantee Obligations hereby until
        payment in full of all such obligations guaranteed hereby. The Guarantor
        agrees
        that, as between it, on the one hand, and the Holders of Notes and the Trustee,
        on the other hand, (x) the maturity of the obligations guaranteed hereby
        may be
        accelerated as provided in Article
        6
        of the Base Indenture
        for the
        purposes hereof, notwithstanding any stay, injunction or other prohibition
        preventing such acceleration in respect of the Guarantee Obligations, and
        (y) in
        the event of any acceleration of such obligations as provided in Article
        6
        of the Base Indenture,
        such
        Guarantee Obligations (whether or not due and payable) shall forthwith become
        due and payable by the Guarantor for the purpose of the Guarantee.

       

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

       

      Section
        6.02.  Execution
        and Delivery of Guarantee. To
        evidence the Guarantee set forth in Section
        6.01
        hereof,
        the Guarantor agrees that a notation of the Guarantee substantially in the
        form
        included in Exhibit A hereto shall be endorsed on each Note authenticated
        and
        delivered by the Trustee and that this First Supplemental Indenture shall
        be
        executed on behalf of the Guarantor by an officer of the Guarantor.

       

      The
        Guarantor agrees that the Guarantee set forth in this Article
        6
        shall
        remain in full force and effect and apply to all the Notes notwithstanding
        any
        failure to endorse on each Note a notation of the Guarantee.

       

      If
        an
        officer whose facsimile signature is on a Note or a notation of Guarantee
        no
        longer holds that office at the time the Trustee authenticates the Note on
        which
        the Guarantee is endorsed, the Guarantee shall be valid
        nevertheless.

       

      The
        delivery of any Note by the Trustee, after the authentication thereof hereunder,
        shall constitute due delivery of the Guarantee set forth in this Indenture
        on
        behalf of the Guarantor.

       

      Section
        6.03.  Limitation
        of Guarantor’s Liability; Certain Bankruptcy Events. It
        is the
        intention of the parties hereto that the Guarantee Obligations of the Guarantor
        pursuant to its Guarantee not constitute a fraudulent transfer or conveyance
        for
        purposes of any Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
        Uniform Fraudulent Transfer Act or any similar federal or state law. To
        effectuate the foregoing intention, the parties hereto hereby irrevocably
        agree
        that the Guarantee Obligations of the Guarantor under this Article
        6
        shall be
        limited to the maximum amount as shall, after giving effect to all other
        contingent and fixed liabilities of the Guarantor, result in the Guarantee
        Obligations of the Guarantor under the Guarantee not constituting a fraudulent
        transfer or conveyance.

       

      Section
        6.04.  Application
        of Certain Terms and Provisions to the Guarantor. For
        purposes of any provision of the Base Indenture (as amended by this First
        Supplemental Indenture) which provides for the delivery by the Guarantor
        of an
        Officers’ Certificate and/or an Opinion of Counsel, the definitions of such
        terms in Section 1.01 of the Base Indenture hereof shall apply to the Guarantor
        as if references therein to the Company or the Guarantor, as applicable,
        were
        references to the Guarantor.

       

       

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

       

       

      Any
        request, direction or demand which by any provision of the Base Indenture
        (as
        amended by this First Supplemental Indenture) is to be made by the Guarantor
        shall be sufficient if evidenced as described in Section 16.03 of the Base
        Indenture as if references therein to the Company were references to the
        Guarantor.

       

      Any
        notice or demand which by any provision of the Base Indenture (as amended
        by
        this First Supplemental Indenture) is required or permitted to be given or
        served by the Trustee or by the Holders of Notes to or on the Guarantor may
        be
        given or served as described in Section 16.03 of the Base Indenture as if
        references therein to the Company were references to the Guarantor and addressed
        as follows: to Citizens Communications Company, 3 High Ridge Park, Stamford,
        Connecticut 06905, Attention: General Counsel, Telecopier No.
        203-614-4651.

       

      Upon
        any
        demand, request or application by the Guarantor to the Trustee to take any
        action under the Base Indenture (as amended by this First Supplemental
        Indenture), the Guarantor shall furnish to the Trustee such certificates
        and
        opinions as are required in Section 16.05 of the Base Indenture as if all
        references therein to the Company were references to the Guarantor.

       

       

      ARTICLE
        7

      Authentication
        Of New Global Note

       

      Section
        7.01.  New
        Global Note. The
        Trustee shall (i) deliver and cancel the Global Note (numbered “No. 1”) in
        accordance with the standing procedures and instructions existing between
        the
        Depositary and the Custodian and (ii) authenticate a new Global Note
        substantially in the form set forth in Exhibit A hereto. The terms and
        provisions contained in the form of Note attached as Exhibit A hereto shall
        constitute, and are hereby expressly made, a part of the Base Indenture and,
        to
        the extent applicable, the Company, Citizens and the Trustee, by their execution
        and delivery of this First Supplemental Indenture, expressly agree to such
        terms
        and provisions and to be bound thereby.

       

       

      ARTICLE
        8

      Miscellaneous

       

      Section
        8.01.  Recitals.
        The
        recitals contained herein shall be taken as the statements of the Company
        and
        the Trustee assumes no responsibility for their correctness. The Trustee
        makes
        no representation as to the validity or sufficiency of this First Supplemental
        Indenture except that the Trustee represents that it is duly authorized to
        execute and deliver this First Supplemental Indenture and perform its
        obligations hereunder.

       

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

       

       

       

      Section
        8.02.  Conflict
        with Trust Indenture Act. If
        any
        provision hereof limits, qualifies or conflicts with a provision of the Trust
        Indenture Act that is required under such Act to be a part of and govern
        this
        First Supplemental Indenture, the Trust Indenture Act shall control. If any
        provision of this First Supplemental Indenture modifies or excludes any
        provision of the Trust Indenture Act that may be so modified or excluded,
        the
        Trust Indenture Act shall be deemed to apply to this First Supplemental
        Indenture as so modified or to be excluded, as the case may be.

       

      Section
        8.03.  Effect
        Of Headings. The
        Section headings herein are for convenience only and shall not affect the
        construction hereof.

       

      Section
        8.04.  Successors
        and Assigns. All
        covenants and agreements in this First Supplemental Indenture by the Company
        shall bind its successors and assigns, whether so expressed or not.

       

      Section
        8.05.  Separability
        Clause. In
        case
        any provision in this First Supplemental Indenture or in the Notes shall
        be
        invalid, illegal or unenforceable, the validity, legality and enforceability
        of
        the remaining provisions shall not in any way be affected or impaired
        thereby.

       

      Section
        8.06.  Benefits
        of First Supplemental Indenture. Nothing
        in this First Supplemental Indenture or in the Notes, express or implied,
        shall
        give to any Person, other than the parties hereto and their respective
        successors hereunder and the Holders of Notes, any benefit or any legal or
        equitable right, remedy or claim under this First Supplemental
        Indenture.

       

      Section
        8.07.  Concerning
        The Trustee. The
        Trustee accepts the Base Indenture, as supplemented by this First Supplemental
        Indenture, and agrees to perform the same upon the terms and conditions set
        forth therein as so supplemented.

       

      Section
        8.08.  Governing
        Law. This
        First Supplemental Indenture and the Notes shall be governed by and construed
        in
        accordance with the laws of the State of New York.

       

      Section
        8.09.  Execution
        In Counterparts. This
        First Supplemental 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.

       

      Section
        8.10.  Effectiveness.
        This
        First Supplemental Indenture shall become effective upon the effectiveness
        of
        the Merger.

       

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      IN
        WITNESS WHEREOF, the parties hereto have caused this First Supplemental
        Indenture to be duly executed as of the day and year first above
        written.

       

      
        	
                COMMONWEALTH
                  TELEPHONE ENTERPRISES, INC.

                 

              
	
                By

              	
                /s/
                  Raymond B. Ostroski

              
	 	
                Name: Raymond
                  B. Ostroski

              
	 	
                Title: Senior
                  Vice  President/General
                  Counsel

              

      

      

      

      
        	
                CITIZENS
                  COMMUNICATIONS COMPANY

                 

              
	
                By

              	
                /s/
                  Donald B. Armour

              
	 	
                Name: Donald
                  B. Armour

              
	 	
                Title: Senior
                  Vice President,  Finance
                  and Treasurer

              

      

      

      

      
        	
                THE
                  BANK OF NEW YORK, AS TRUSTEE

                 

              
	
                By

              	
                /s/
                  Mary Lagumina

              
	 	
                Name: Mary
                  Lagumina

              
	 	
                Title: Vice
                  President

              

      

      
 

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

    

     

     

     

    

     

    EXHIBIT
      A

     

    [FORM
      OF
      GLOBAL NOTE]

     

    UNLESS
      THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
      TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (THE “DEPOSITARY”,
      WHICH
      TERM INCLUDES ANY SUCCESSOR DEPOSITARY FOR THE CERTIFICATES) TO THE COMPANY
      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 THE DEPOSITARY (AND ANY PAYMENT
      HEREIN IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
      AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), 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.

     

    THE
      NOTE
      EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES
      ACT
      OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND,
      ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING
      SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT IT IS A
“QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE
      SECURITIES ACT), (2) AGREES THAT IT WILL NOT, PRIOR TO EXPIRATION OF THE
      HOLDING PERIOD APPLICABLE TO SALES OF THE NOTE EVIDENCED HEREBY UNDER
      RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION), RESELL
      OR OTHERWISE TRANSFER THIS NOTE OR THE COMMON STOCK ISSUABLE UPON CONVERSION
      OF
      THIS NOTE EXCEPT (A) TO COMMONWEALTH TELEPHONE ENTERPRISES, INC. OR ANY
      SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
      WITH RULE 144A UNDER THE SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION
      FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
      AVAILABLE), OR (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
      DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE
      AT THE TIME OF SUCH TRANSFER); (3) PRIOR TO SUCH TRANSFER (OTHER THAN A
      TRANSFER PURSUANT TO CLAUSE 2(D) ABOVE), IT WILL FURNISH TO THE BANK OF
      NEW YORK, AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
      CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE TRUSTEE MAY
      REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO
      AN
      EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
      REQUIREMENTS OF THE SECURITIES ACT, AND (4) AGREES THAT IT WILL DELIVER TO
      EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
      EFFECT OF THIS LEGEND, THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE
      TRANSFER OF THIS NOTE PURSUANT TO CLAUSE 2(D) ABOVE OR UPON ANY TRANSFER OF
      THIS NOTE UNDER RULE 144(k) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
      PROVISION). THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE TO REFUSE
      TO REGISTER ANY TRANSFER OF THIS NOTE IN VIOLATION OF THE FOREGOING
      RESTRICTION.

     

    

    
      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

    

    

    COMMONWEALTH
      TELEPHONE ENTERPRISES, INC.

     

    31⁄4%
      CONVERTIBLE NOTE DUE 2023

     

    CUSIP:
      203349AA3

     

    No.
      2                                                                                  Up
      to
      $[                   ]

     

    Commonwealth
      Telephone Enterprises, Inc., a corporation duly organized and validly
      existing under the laws of the State of Pennsylvania (herein called the
“Company”,
      which
      term includes any successor corporation under the Indenture referred to on
      the
      reverse hereof), for value received hereby promises to pay to CEDE &
CO. or its registered assigns, the principal sum as set forth on Schedule I
      hereto on July 15, 2023, at the office or agency of the Company maintained
      for that purpose in accordance with the terms of the Indenture, in such coin
      or
      currency of the United States of America as at the time of payment shall be
      legal tender for the payment of public and private debts, and to pay interest,
      semiannually on January 15 and July 15 of each year, commencing
      January 15, 2004, on said principal sum at said office or agency, in like
      coin or currency, at the rate per annum of 3.25%, from the January 15 or
      July 15, as the case may be, next preceding the date of this Note to which
      interest has been paid or duly provided for, unless the date hereof is a date
      to
      which interest has been paid or duly provided for, in which case from the date
      of this Note, or unless no interest has been paid or duly provided for on the
      Notes, in which case from July 18, 2003, until payment of said principal
      sum has been made or duly provided for. Notwithstanding the foregoing, if the
      date hereof is after any January 1 or July 1, as the case may be, and
      before the following January 15 or July 15, this Note shall bear
      interest from such January 15 or July 15;
      provided
      that if
      the Company shall default in the payment of interest due on such January 15
      or July 15, then this Note shall bear interest from the next preceding
      January 15 or July 15 to which interest has been paid or duly provided
      for or, if no interest has been paid or duly provided for on such Note, from
      July 18, 2003. Contingent interest, if any, will accrue for any six month
      interest period and be payable to holders of this Note on the applicable
      interest payment date to the person in whose name this Note is registered on
      the
      corresponding record date. Except as otherwise provided in the Indenture, the
      interest payable on the Note pursuant to the Indenture on any January 15 or
      July 15 will be paid to the Person entitled thereto as it appears in the
      Note Register at the close of business on the record date, which shall be the
      January 1 or July 1 (whether or not a Business Day) next preceding
      such January 15 or July 15, as provided in the Indenture;
      provided
      that any
      such interest not punctually paid or duly provided for shall be payable as
      provided in the Indenture. The Company shall pay interest (i) on any Notes
      in certificated form by check mailed to the address of the Person entitled
      thereto as it appears in the Note Register (provided
      that the
      holder of Notes with an aggregate principal amount in excess of $2,000,000
      shall, at the written election of such holder, be paid by wire transfer of
      immediately available funds) or (ii) on any Global Note by wire transfer of
      immediately available funds to the account of the Depositary or its
      nominee.

     

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

     

    The
      Company promises to pay interest on overdue principal and (to the extent that
      payment of such interest is enforceable under applicable law) interest at the
      rate of 1% per annum.

     

    Reference
      is made to the further provisions of this Note set forth on the reverse hereof,
      including, without limitation, provisions giving the holder of this Note the
      right to convert this Note on the terms and subject to the limitations referred
      to on the reverse hereof and as more fully specified in the Indenture. Such
      further provisions shall for all purposes have the same effect as though fully
      set forth at this place.

     

    This
      Note
      shall be deemed to be a contract made under the laws of the State of New York,
      and for all purposes shall be construed in accordance with and governed by
      the
      laws of the State of New York, without regard to conflicts of laws principles
      thereof.

     

    This
      Note
      shall not be valid or become obligatory for any purpose until the certificate
      of
      authentication hereon shall have been manually signed by the Trustee or a duly
      authorized authenticating agent under the Indenture.

     

    

    
      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

    

    

    IN
      WITNESS WHEREOF, the Company has caused this Note to be duly
      executed.

     

    
       

      
        	
                COMMONWEALTH
                  TELEPHONE ENTERPRISES, INC.

                 

              
	
                By

              	
                 

              
	 	
                Name:

              
	 	
                Title

              

      

      
Attest:

    

    
       

      
        	
                 

              
	
                By

              	
                 

              
	 	
                Name:

              
	 	
                Title

              

      

      

 

    

    TRUSTEE’S
      CERTIFICATE OF AUTHENTICATION

    

    This
      is
      one of the Notes described in the within-named Indenture.

    

    THE
      BANK
      OF NEW YORK, as Trustee

     

    
      
        	
                 

              
	
                By

              	
                 

              
	 	
                Authorized
                  Signatory

              
	 	
                 

              

      

       

    

    ,
      or

     

    
      
        	
                 

              
	
                By

              	
                 

              
	 	
                As
                  Authenticating Agent

                (if
                  different from Trustee)

              
	 	
                 

              

      

       

    

     

    
      	 	By 	 
	 	 	Authorized Signatory 
	 	 	 

    

     

     

    

    
      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

    

    

    FORM
      OF
      REVERSE OF NOTE

    

    COMMONWEALTH
      TELEPHONE ENTERPRISES, INC.

    

    31⁄4%
      CONVERTIBLE NOTE DUE 2023

    

    This
      Note
      is one of a duly authorized issue of Notes of the Company, designated as its
      31⁄4%
      Convertible Notes due 2023 (herein called the “Notes”),
      limited in aggregate principal amount to $300,000,000, issued and to be issued
      under and pursuant to an Indenture dated as of July 18, 2003, between the
      Company and The Bank of New York, as trustee (herein called the “Trustee”)
      (the
“Base
      Indenture”),
      as
      amended by the First Supplemental Indenture dated as of March 8, 2007 among
      the
      Company, Citizens Communications Company, a Delaware corporation (“Citizens”)
      and
      the Trustee (the “First
      Supplemental Indenture”
and
      together with the Base Indenture, the “Indenture”),
      to
      which Indenture and all indentures supplemental thereto reference is hereby
      made
      for a description of the rights, limitations of rights, obligations, duties
      and
      immunities thereunder of the Trustee, the Company, Citizens and the holders
      of
      the Notes.

     

    In
      case
      an Event of Default shall have occurred and be continuing, the principal of
      and
      accrued and unpaid Interest on all Notes may be declared by either the Trustee
      or the holders of not less than 25% in aggregate principal amount of the Notes
      then outstanding, and upon said declaration shall become, due and payable,
      in
      the manner, with the effect and subject to the conditions provided in the
      Indenture.

     

    The
      Indenture contains provisions permitting the Company and the Trustee, with
      the
      consent of the holders of at least a majority in aggregate principal amount
      of
      the Notes at the time outstanding, to execute supplemental indentures adding
      any
      provisions to or changing in any manner or eliminating any of the provisions
      of
      the Indenture or of any supplemental indenture or modifying in any manner the
      rights of the holders of the Notes;
      provided
      that no
      such supplemental indenture shall (i) extend the fixed maturity of any
      Note, or reduce the rate or extend the time of payment of Interest thereon,
      or
      reduce the principal amount thereof or reduce any amount payable upon redemption
      or repurchase thereof, or change the obligation of the Company to repurchase
      any
      Note at the option of a Noteholder on a Repurchase Date in a manner adverse
      to
      the holders of Notes, or change the obligation of the Company to repurchase
      any
      Note upon the happening of a Designated Event in a manner adverse to the holders
      of Notes, or impair the right of any Noteholder to institute suit for the
      payment thereof, or make the principal thereof or interest thereon payable
      in
      any coin or currency other than that provided in the Notes, or impair the right
      to convert the Notes in accordance with the terms set forth in the Indenture,
      including Section 15.06 thereof, in each case, without the consent of the holder
      of each Note so affected, or modify any of the provisions of Section 11.02
      or
      Section 7.07 thereof, except to increase any such percentage or to provide
      that
      certain other provisions of the Indenture cannot be modified or waived without
      the consent of the holder of each Note so affected, or change any obligation
      of
      the Company to maintain an office or agency in the places and for the purposes
      set forth in Section 5.02 thereof, or reduce the quorum or voting requirements
      set forth in Article 10 or (ii) reduce the aforesaid percentage of Notes,
      the holders of which are required to consent to any such supplemental indenture,
      without the consent of the holders of all Notes then outstanding. Subject to
      the
      provisions of the Indenture, the holders of a majority in aggregate principal
      amount of the Notes at the time outstanding may on behalf of the holders of
      all
      of the Notes waive any past Default or Event of Default under the Indenture
      and
      its consequences except (A) a default in the payment of Interest on, or the
      principal of, any of the Notes, (B) a failure by the Company to convert any
      Notes in accordance with the terms set forth in the Indenture, (C) a
      default in the payment of the redemption price pursuant to Article 3 of the
      Indenture, (D) a default in the payment of the repurchase price pursuant to
      Article 3 of the Indenture, or (E) a default in respect of a covenant
      or provisions of the Indenture which under Article 11 of the Indenture cannot
      be
      modified or amended without the consent of the holders of each or all Notes
      then
      outstanding or affected thereby. Any such consent or waiver by the holder of
      this Note (unless revoked as provided in the Indenture) shall be conclusive
      and
      binding upon such holder and upon all future holders and owners of this Note
      and
      any Notes which may be issued in exchange or substitution hereof, irrespective
      of whether or not any notation thereof is made upon this Note or such other
      Notes.

     

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

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

     

    Interest
      on the Notes shall be computed on the basis of a 360-day year of twelve 30-day
      months.

     

    The
      Notes
      are issuable in fully registered form, without coupons, in denominations of
      $1,000 principal amount and any multiple of $1,000. At the office or agency
      of
      the Company referred to on the face hereof, and in the manner and subject to
      the
      limitations provided in the Indenture, without payment of any service charge
      but
      with payment of a sum sufficient to cover any tax, assessment or other
      governmental charge that may be imposed in connection with any registration
      or
      exchange of Notes, Notes may be exchanged for a like aggregate principal amount
      of Notes of any other authorized denominations.

     

    At
      any
      time on or after July 18, 2008 and prior to maturity, the Notes may be
      redeemed at the option of the Company, in whole or in part, upon mailing a
      notice of such redemption not less than 30 days but not more than
      60 days before the redemption date to the holders of Notes at their last
      registered addresses, all as provided in the Indenture, at a cash redemption
      price equal to 100% of the principal amount of the Notes being redeemed and
      accrued and unpaid Interest, to, but excluding, the redemption date;
      provided
      that if
      the redemption date falls after a record date and on or prior the corresponding
      interest payment date, then accrued and unpaid Interest to, but excluding,
      the
      redemption date shall be paid on such interest payment date to the holders
      of
      record of such Notes on the applicable record date instead of to the holders
      surrendering such Notes for redemption on such date.

     

    The
      Company may not give notice of any redemption of the Notes if a default in
      the
      payment of Interest on the Notes has occurred and is continuing.

     

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    The
      Notes
      are not subject to redemption through the operation of any sinking
      fund.

     

    If
      a
      Designated Event occurs at any time prior to maturity of the Notes, the Company
      shall become obligated to purchase, at the option of the holder, all or any
      portion of the Notes held by such holder, on a date specified by the Company
      that is thirty (30) days after notice thereof at a cash repurchase price of
      100% of the principal amount, plus any accrued and unpaid Interest, on such
      Note
      up to, but excluding, the Designated Event Repurchase Date;
      provided
      that if
      the repurchase date falls after a record date and on or prior the corresponding
      interest payment date, then accrued and unpaid Interest to, but excluding,
      the
      Designated Event Repurchase Date shall be paid on such interest payment date
      to
      the holders of record of such Notes on the applicable record date instead of
      to
      the holders surrendering such Notes for repurchase on such date. The Notes
      will
      be subject to repurchase in multiples of $1,000 principal amount. The Company
      shall mail to all holders of record of the Notes a notice of the occurrence
      of a
      Designated Event and of the repurchase right arising as a result thereof on
      or
      before the 15th day
      after the occurrence of such Designated Event. To exercise such right, a holder
      shall deliver to the Company such Note with the form entitled “Designated
      Event Repurchase
      Notice”
on
      the
      reverse thereof duly completed, together with the Note, duly endorsed for
      transfer, at any time prior to the close of business on the Designated Event
      Repurchase Date, and shall deliver the Notes to the Trustee (or other paying
      agent appointed by the Company) as set forth in the Indenture.

     

    Subject
      to the terms and conditions of the Indenture, the Company shall become obligated
      to purchase, at the option of the holder, all or any portion of the Notes held
      by such holder on July 15, 2008, 2013 and 2018 in whole multiples of $1,000
      at a cash repurchase price of 100% of the principal amount, plus any accrued
      and
      unpaid Interest, on such Note up to the Repurchase Date. To exercise such right,
      a holder shall deliver to the Company such Note with the form entitled
“Repurchase
      Notice”
on
      the
      reverse thereof duly completed, together with the Note, duly endorsed for
      transfer, at any time from the opening of business on the date that is 20
      Business Days prior to such Repurchase Date until the close of business on
      the
      date that is two Business Days prior to the Repurchase Date, and shall deliver
      the Notes to the Trustee (or other paying agent appointed by the Company) as
      set
      forth in the Indenture.

     

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

     

    Holders
      have the right to withdraw any Designated Event Repurchase Notice or the
      Repurchase Notice, as the case may be, by delivering to the Trustee (or other
      paying agent appointed by the Company) a written notice of withdrawal up to
      the
      close of business on the Designated Event Repurchase Date or the Repurchase
      Date, as the case may be, all as provided in the Indenture.

     

    If
      money
      or cash, sufficient to pay the repurchase price of all Notes or portions thereof
      to be purchased as of the Designated Event Repurchase Date or the Repurchase
      Date, as the case may be, is deposited with the Trustee (or other paying agent
      appointed by the Company), on the Designated Event Repurchase Date or the
      Repurchase Date, as the case may be, interest will cease to accrue on such
      Notes
      (or portions thereof) immediately after such Repurchase Date, and the holder
      thereof shall have no other rights as such other than the right to receive
      the
      repurchase price upon surrender of such Note.

     

    Subject
      to the occurrence of certain events and in compliance with the provisions of
      the
      Indenture, prior to the final maturity date of the Notes, the holder hereof
      has
      the right, at its option, to convert each $1,000 principal amount of the Notes
      into $804.84 in cash, without interest, and Common Stock based on a conversion
      rate (the “Conversion
      Rate”)
      of
      25.7055 (a conversion price of approximately $38.90) multiplied by 0.768,
      subject to adjustment from time to time as provided in the Indenture, upon
      surrender of this Note with the form entitled “Conversion
      Notice”
on
      the
      reverse thereof duly completed, to the Company at the office or agency of the
      Company maintained for that purpose in accordance with the terms of the
      Indenture, or at the option of such holder, the Corporate Trust Office, and,
      unless the shares and cash issuable on conversion are to be issued in the same
      name as this Note, duly endorsed by, or accompanied by instruments of transfer
      in form satisfactory to the Company duly executed by, the holder or by his
      duly
      authorized attorney. The Company will notify the holder thereof of any event
      triggering the right to convert the Notes as specified above in accordance
      with
      the Indenture.

     

    No
      adjustment in respect of interest on any Note converted or dividends on any
      shares issued upon conversion of such Note will be made upon any conversion
      except as set forth in the next sentence. If this Note (or portion hereof)
      is
      surrendered for conversion during the period from the close of business on
      any
      record date for the payment of interest to the close of business on the Business
      Day preceding the following interest payment date, this Note (or portion hereof
      being converted) must be accompanied by payment, in immediately available funds
      or other funds acceptable to the Company, of an amount equal to the interest
      otherwise payable on such interest payment date on the principal amount being
      converted;
      provided
      that no
      such payment shall be required (1) if the Company has specified a redemption
      date that is after a record date and prior to the next interest payment date,
      (2) if the Company has specified a Designated Event Repurchase Date that is
      during such period or (3) to the extent of any overdue Interest, if any overdue
      interest exists at the time of conversion with respect to such Note.

     

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    No
      fractional shares will be issued upon any conversion, but an adjustment and
      payment in cash will be made, as provided in the Indenture, in respect of any
      fraction of a share which would otherwise be issuable upon the surrender of
      any
      Note or Notes for conversion. 

     

    A
      Note in
      respect of which a holder is exercising its right to require repurchase upon
      a
      Designated Event or repurchase on a Repurchase Date may be converted only if
      such holder withdraws its election to exercise either such right in accordance
      with the terms of the Indenture.

     

    Any
      Notes
      called for redemption, unless surrendered for conversion by the holders thereof
      on or before the close of business on the Business Day preceding the redemption
      date, may be deemed to be redeemed from the holders of such Notes for an amount
      equal to the applicable redemption price, together with accrued but unpaid
      interest to, but excluding, the date fixed for redemption, by one or more
      investment banks or other purchasers who may agree with the Company (i) to
      purchase such Notes from the holders thereof and convert them in accordance
      with
      the terms of the Indenture and (ii) to make payment for such Notes as aforesaid
      to the Trustee in trust for the holders.

     

    Upon
      due
      presentment for registration of transfer of this Note at the office or agency
      of
      the Company maintained for that purpose in accordance with the terms of the
      Indenture, a new Note or Notes of authorized denominations for an equal
      aggregate principal amount will be issued to the transferee in exchange thereof,
      subject to the limitations provided in the Indenture, without charge except
      for
      any tax, assessment or other governmental charge imposed in connection
      therewith.

     

    The
      Company, the Trustee, any authenticating agent, any paying agent, any conversion
      agent and any Note Registrar may deem and treat the registered holder hereof
      as
      the absolute owner of this Note (whether or not this Note shall be overdue
      and
      notwithstanding any notation of ownership or other writing hereon made by anyone
      other than the Company or any Note Registrar) for the purpose of receiving
      payment hereof, or on account hereof, for the conversion hereof and for all
      other purposes, and neither the Company nor the Trustee nor any other
      authenticating agent nor any paying agent nor other conversion agent nor any
      Note Registrar shall be affected by any notice to the contrary. All payments
      made to or upon the order of such registered holder shall, to the extent of
      the
      sum or sums paid, satisfy and discharge liability for monies payable on this
      Note.

     

    No
      recourse for the payment of the principal of or Interest on this Note, or for
      any claim based hereon or otherwise in respect hereof, and no recourse under
      or
      upon any obligation, covenant or agreement of the Company in the Indenture
      or
      any supplemental indenture or in any Note, or because of the creation of any
      indebtedness represented thereby, shall be had against any incorporator,
      stockholder, employee, agent, officer or director or subsidiary, as such, past,
      present or future, of the Company or of any successor corporation, either
      directly or through the Company or any successor corporation, whether by virtue
      of any constitution, statute or rule of law or by the enforcement of any
      assessment or penalty or otherwise, all such liability being, by acceptance
      hereof and as part of the consideration for the issue hereof, expressly waived
      and released.

     

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

     

    For
      purposes of sections 1272, 1273 and 1275 of the Internal Revenue Code of 1986,
      as amended, this Note is being issued with Tax Original Issue Discount and
      the
      issue date of this Note is July 18, 2003. In addition, this Note is subject
      to
      the United States federal income tax regulations governing contingent payment
      debt instruments. For purposes of sections 1272, 1273 and 1275 of the Internal
      Revenue Code, the comparable yield of this Note is 8.00% per year, compounded
      semi-annually (which will be treated as the yield to maturity for United States
      federal income tax purposes).

     

    The
      Company agrees, and by acceptance of a beneficial interest in a Note each holder
      and any beneficial owner of a Note shall be deemed to have agreed to treat
      the
      Note as indebtedness of the Company for United States federal income tax
      purposes that is subject to Treasury Regulation Section 1.1275-4 or any
      successor provision (the “contingent payment regulations”) and to be bound (in
      the absence of an administrative determination or judicial ruling to the
      contrary) by the Company’s determination of the comparable yield and the
      projected payment schedule within the meaning of the contingent payment
      regulations. A holder of Notes may obtain the issue price amount of Tax Original
      Issue Discount, issue date, yield to maturity, comparable yield and projected
      payment schedule for the Notes, determined by the Company pursuant to the
      contingent payment regulations, by submitting a written request for it to the
      Company at the following address: Commonwealth Telephone Enterprises, Inc.,
      100 CTE Drive, Dallas, Pennsylvania 18612-9774, Attention: Vice
      President, Investor Relations.

     

    This
      Note
      shall be deemed to be a contract made under the laws of New York, and for all
      purposes shall be construed in accordance with the laws of New York, without
      regard to conflicts of laws principles thereof.

     

    Terms
      used in this Note and defined in the Indenture are used herein as therein
      defined.

     

    

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

    

    ABBREVIATIONS

     

    The
      following abbreviations, when used in the inscription of the face of this Note,
      shall be construed as though they were written out in full according to
      applicable laws or regulations.

     

    
      	
              TEN
                COM - 

            	
              as
                tenants in common 

            	
              UNIF
                GIFT MIN ACT -___ Custodian ___

            
	
              TEN
                ENT - 

            	
              as
                tenant by the entireties 

            	
              (Cust) (Minor)

            
	
              JT
                TEN - 

            	
              as
                joint tenants with right of survivorship and not as tenants in
                common

            	
              under
                Uniform Gifts to Minors Act

              ____________________________

              (State)

            

    

    

    Additional
      abbreviations may also be used though not in the above list.

     

     

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

     

    

    GUARANTEE

     

    The
      Guarantor listed below (hereinafter referred to as the “Guarantor,”
which
      term includes any successors or assigns under the Indenture dated as of July
      18,
      2003, between the Commonwealth Telephone Enterprises, Inc. (the “Company”)
      and
      The Bank of New York, as trustee (herein called the “Trustee”)
      (the
“Base
      Indenture”),
      as
      amended by the First Supplemental Indenture dated as of March 8, 2007 among
      the
      Company, Citizens Communications Company, a Delaware corporation (“Citizens”)
      and
      the Trustee (the “First
      Supplemental Indenture”,
      and
      together with the Base Indenture, the “Indenture”),
      has
      irrevocably and unconditionally guaranteed on a senior basis the Guarantee
      Obligations (as defined in Section 6.01 of the First Supplemental Indenture),
      which include (i) the due and punctual payment of the principal of and interest
      and Additional Interest, if any, on the 31⁄4% Convertible Notes due 2023 (the
“Notes”)
      of the
      Company, whether at maturity, by acceleration, call for redemption, upon a
      repurchase or otherwise, the due and punctual payment of interest on the overdue
      principal and (to the extent permitted by law) interest on any interest on
      the
      Notes, and the due and punctual performance of all other obligations of the
      Company, to the Holders of the Notes or the Trustee all in accordance with
      the
      terms set forth in Article
      6
      of the
      First Supplemental Indenture, and (ii) in case of any extension of time of
      payment or renewal of any Notes or any such other obligations, that the same
      shall be promptly paid in full when due or performed in accordance with the
      terms of the extension or renewal, whether at maturity, by acceleration, call
      for redemption, upon a repurchase or otherwise.

     

    The
      obligations of the Guarantor to the Holders of the Notes and to the Trustee
      pursuant to this Guarantee and the Indenture are expressly set forth in
Article
      6
      of the
      First Supplemental Indenture and reference is hereby made to such First
      Supplemental Indenture for the precise terms of this Guarantee.

     

    The
      Guarantor hereby waives diligence, presentment, demand of payment, filing of
      claims with a court in the event of merger or bankruptcy of the Company, any
      right to require a proceeding first against the Company, the benefit of
      discussion, protest or notice with respect to the Notes and all demands
      whatsoever.

     

    This
      is a
      continuing Guarantee and shall remain in full force and effect and shall be
      binding upon the Guarantor and its successors and assigns until full and final
      payment of all of the Company’s obligations under the Notes and Indenture or
      until legally discharged in accordance with the Indenture and shall inure to
      the
      benefit of the successors and assigns of the Trustee and the Holders of the
      Notes, and, in the event of any transfer or assignment of rights by any Holder
      of the Notes or the Trustee, the rights and privileges herein conferred upon
      that party shall automatically extend to and be vested in such transferee or
      assignee, all subject to the terms and conditions hereof. This is a Guarantee
      of
      payment and performance and not of collectibility.

     

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

     

     

    This
      Guarantee shall not be valid or obligatory for any purpose until the certificate
      of authentication on the Note upon which this Guarantee is noted shall have
      been
      executed by the Trustee under the Indenture by the manual or facsimile signature
      of one of its authorized officers.

     

    The
      obligations of the Guarantor under this Guarantee shall be limited to the extent
      necessary to insure that it does not constitute a fraudulent conveyance under
      applicable law.

     

    THE
      TERMS
      OF ARTICLE 6 OF THE FIRST SUPPLEMENTAL INDENTURE ARE INCORPORATED HEREIN BY
      REFERENCE.

     

    Capitalized
      terms used herein have the same meanings given in the Indenture unless otherwise
      indicated.

     

    

    
      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

    

    

    IN
      WITNESS WHEREOF, the Guarantor has caused this instrument to be duly
      executed.

     

    Dated:
      

     

    
       

      
        	
                COMMONWEALTH
                  TELEPHONE ENTERPRISES, INC.

                 

              
	
                By

              	
                 

              
	 	
                Name:

              
	 	
                Title:

              

      

      

    

    

    
      
        
          
          

        

        
          31

          
            

          

        

        
          
          

        

      

    

    

    CONVERSION
      NOTICE

     

    
      	
              TO:

            	
              COMMONWEALTH
                TELEPHONE ENTERPRISES, INC.

              THE
                BANK OF NEW YORK

            

    

     

    

    The
      undersigned registered owner of this Note hereby irrevocably exercises the
      option to convert this Note, or the portion thereof (which is $1,000 or a
      multiple thereof) below designated, in accordance with the terms of the
      Indenture referred to in this Note, and directs that the shares, if any,
      issuable and deliverable upon such conversion, together with any check in
      payment of any cash and any Notes representing any unconverted principal amount
      hereof, be issued and delivered to the registered holder hereof unless a
      different name has been indicated below. Capitalized terms used herein but
      not
      defined shall have the meanings ascribed to such terms in the Indenture. If
      shares, any portion of this Note not converted or a check for cash payable
      are
      to be issued in the name of a person other than the undersigned, the undersigned
      will provide the appropriate information below and pay all transfer taxes
      payable with respect thereto. Any amount required to be paid by the undersigned
      on account of interest, including contingent interest, if any, accompanies
      this
      Note.

     

     

    
      	Dated:
              ______________________________________________________ 	 
	 	 
	 	_____________________________________________________________ 
	 	
               

              _____________________________________________________________

            
	 	Signature(s) 
	 	
            
	 	Signature(s) must be guaranteed by an “eligible
              guarantor institution”
              meeting the requirements of the Note Registrar, which requirements
              include
              membership or participation in the Security Transfer Agent Medallion
              Program (“STAMP”)
              or such other “signature
              guarantee program”
              as may be determined by the Note Registrar in addition to, or in
              substitution for, STAMP, all in accordance with the Securities Exchange
              Act of 1934, as amended. 
	 	 
	 	_____________________________________________________________ 
	 	Signature Guarantee 

    

    

     

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

    

     

    Fill
      in
      the registration of shares of Common Stock if to be issued, and Notes if to
      be
      delivered, other than to and in the name of the registered holder:

     

    ___________________________________

    (Name)

    

    

    ___________________________________

    (Street
      Address)

    

    

    ___________________________________

    (City,
      State and Zip Code) 

    

    

    ___________________________________

    Please
      print name and address

    

    Principal
      amount to be converted

    (if
      less
      than all):

    

    $__________________________________

     

    Social
      Security or Other Taxpayer

    Identification
      Number:

    

    

    ___________________________________

     

     

    

    
      
        
          
          

        

        
          33

          
            

          

        

        
          
          

        

      

    

    

    DESIGNATED
      EVENT REPURCHASE NOTICE

     

    
      	
              TO:

            	
              COMMONWEALTH
                TELEPHONE ENTERPRISES, INC.

              
                THE
                  BANK OF NEW YORK

              

            

    

    

    The
      undersigned registered owner of this Note hereby irrevocably acknowledges
      receipt of a notice from Commonwealth Telephone Enterprises, Inc. (the
“Company”)
      regarding the right of holders to elect to require the Company to repurchase
      the
      Notes upon the occurrence of a Designated Event with respect to the Company
      and
      requests and instructs the Company to repay the entire principal amount of
      this
      Note, or the portion thereof (which is $1,000 or an integral multiple thereof)
      below designated, in accordance with the terms of the Indenture at the price
      of
      100% of such entire principal amount or portion thereof, together with accrued
      Interest to, but excluding, the Designated Event Repurchase Date, to the
      registered holder hereof. Capitalized terms used herein but not defined shall
      have the meanings ascribed to such terms in the Indenture. The Notes shall
      be
      repurchased by the Company as of the portion thereof, together with accrued
      interest to, but excluding, the Designated Event Repurchase Date pursuant to
      the
      terms and conditions specified in the Indenture. 

     

    $
      principal amount of the Notes to which this Designated Event Repurchase Notice
      relates (if less than entire principal amount)

    

    Dated:

     

    Signature(s):

     

    NOTICE:
      The above signatures of the holder(s) hereof must correspond with the name
      as
      written upon the face of the Note in every particular without alteration or
      enlargement or any change whatever.

     

    Note
      Certificate Number (if applicable):

     

    Principal
      amount to be repurchased (if less than all):

     

    Social
      Security or Other Taxpayer Identification Number:

     

    

    

    
      
        
          
          

        

        
          34

          
            

          

        

        
          
          

        

      

    

    

    REPURCHASE
      NOTICE

     

    
      	
              TO:

            	
              COMMONWEALTH
                TELEPHONE ENTERPRISES, INC.

              
                THE
                  BANK OF NEW YORK

              

            

    

    

    The
      undersigned registered owner of this Note hereby irrevocably acknowledges
      receipt of a notice from Commonwealth Telephone Enterprises, Inc. (the
“Company”)
      regarding the right of holders to elect to require the Company to repurchase
      the
      Notes and requests and instructs the Company to repay the entire principal
      amount of this Note, or the portion thereof (which is $1,000 or an integral
      multiple thereof) below designated, in accordance with the terms of the
      Indenture at the price of 100% of such entire principal amount or portion
      thereof, together with accrued Interest to, but excluding, the Repurchase Date,
      to the registered holder hereof. Capitalized terms used herein but not defined
      shall have the meanings ascribed to such terms in the Indenture. The Notes
      shall
      be repurchased by the Company as of the Repurchase Date pursuant to the terms
      and conditions specified in the Indenture. 

    

    $  
       principal amount of the Notes to which this Repurchase Notice relates (if
      less than entire principal amount)

    

    Dated:

     

    Signature(s):

     

    NOTICE:
      The above signatures of the holder(s) hereof must correspond with the name
      as
      written upon the face of the Note in every particular without alteration or
      enlargement or any change whatever.

     

    Note
      Certificate Number (if applicable):

     

    Principal
      amount to be repurchased (if less than all):

     

    Social
      Security or Other Taxpayer Identification Number:

     

    

    
      
        
          
          

        

        
          35

          
            

          

        

        
          
          

        

      

    

    

    ASSIGNMENT

     

    For
      value
      received ______________________________hereby sell(s) assign(s) and transfer(s)
      unto ___________________________________ (Please insert social security or
      other
      Taxpayer Identification Number of assignee) the within Note, and hereby
      irrevocably constitutes and appoints ______________________________________
      attorney to transfer said Note on the books of the Company, with full power
      of
      substitution in the premises.

     

    In
      connection with any transfer of the Note prior to the expiration of the holding
      period applicable to sales thereof under Rule 144(k) under the Securities Act
      (or any successor provision) (other than any transfer pursuant to a registration
      statement that has been declared effective under the Securities Act), the
      undersigned confirms that such Note is being transferred:

     

    
      	 	 o	
              To
                Commonwealth Telephone Enterprises, Inc. or a subsidiary thereof;
                or

            

    

     

    
      	 	 o	
              To
                a “qualified
                institutional buyer”
                in compliance with Rule 144A under the Securities Act of 1933, as
                amended;
                or

            

    

     

    
      	 	 o	
              Pursuant
                to and in compliance with Rule 144 under the Securities Act of 1933,
                as
                amended; or

            

    

     

    
      	 	 o	
              Pursuant
                to a Registration Statement which has been declared effective under
                the
                Securities Act of 1933, as amended, and which continues to be effective
                at
                the time of transfer; 

            

    

     

    and
      unless the Note has been transferred to Commonwealth Telephone
      Enterprises, Inc. or a subsidiary thereof, the undersigned confirms that
      such Note is not being transferred to an “affiliate”
of
      the
      Company as defined in Rule 144 under the Securities Act of 1933, as
      amended.

    

    Unless
      one of the boxes is checked, the Trustee will refuse to register any of the
      Notes evidenced by this certificate in the name of any person other than the
      registered holder thereof.

     

    
       

      
        	Dated:
                ______________________________________________________ 	 
	 	 
	 	_____________________________________________________________ 
	 	
                 

                _____________________________________________________________

              
	 	Signature(s) 

      

       

       

       

      
        
          
          

        

        
          36

          
            

          

        

        
          
          

        

      

       

       

       

       

      
        	 	
              
	 	Signature(s) must be guaranteed by an “eligible
                guarantor institution”
                meeting the requirements of the Note Registrar, which requirements
                include
                membership or participation in the Security Transfer Agent Medallion
                Program (“STAMP”)
                or such other “signature
                guarantee program”
                as may be determined by the Note Registrar in addition to, or in
                substitution for, STAMP, al in accordance with the Securities Exchange
                Act
                of 1934, as amended.
	 	 
	 	_____________________________________________________________ 
	 	Signature Guarantee 

      

      

       

    

    NOTICE:
      The signature on the Conversion Notice, the Designated Event Repurchase Notice,
      the Repurchase Notice or the Assignment must correspond with the name as written
      upon the face of the Note in every particular without alteration or enlargement
      or any change whatever.

     

     

    
 

    
      
        
          
          

        

        
          37

          
            

          

        

        
          
          

        

      

    

    

    Schedule
      I

    

    

    

    COMMONWEALTH
      

    TELEPHONE
      ENTERPRISES, INC.

    31⁄4%
      Convertible Note due 2023

    

    No.
      2

    

    The
      original principal amount of this Note is
      $[                     
      ] DOLLARS
      ($[                            ]).
      The principal amount has been adjusted in accordance with the terms of the
      Indenture as set forth below:

     

    
       

      

      
        	
                Date

              	
                Principal
                  Amount

              	
                Notation
                  Explaining Principal Amount Recorded

              	
                Authorized
                  Signature of Trustee or Custodian

              
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

      

      

      
 

    

    
38First Supplemental Indenture 2005 Series A

     

    Exhibit
      10.2

     

    
      

    

     

    
 

     

     

    COMMONWEALTH
      TELEPHONE ENTERPRISES, INC.,

    

    CITIZENS
      COMMUNICATIONS COMPANY

     

    AND

     

    THE
      BANK
      OF NEW YORK

     

    as
      Trustee

     

    ____________________

     

    First
      Supplemental Indenture

     

    Dated
      as
      of March 8, 2007

     

    ___________________

     

    2005
      Series A 31⁄4% Convertible Notes due 2023

     

     

     

     

     

    
      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

            FIRST
      SUPPLEMENTAL
      INDENTURE dated as of March 8, 2007 (the “First
      Supplemental Indenture”)
      among
      COMMONWEALTH TELEPHONE ENTERPRISES, INC., a Pennsylvania corporation (the
“Company”),
      CITIZENS COMMUNICATIONS COMPANY, a Delaware corporation (“Citizens”
or
      in
      its capacity as the guarantor, the “Guarantor”),
      and
      THE BANK OF NEW YORK, a New York banking corporation, as Trustee (the
“Trustee”).

     

    RECITALS
      OF THE COMPANY

     

            WHEREAS,
      the Company
      and the
      Trustee
      have
      heretofore executed and delivered the Indenture dated as of August 3, 2005
      (the
“Base
      Indenture”)
      relating to the Company’s 2005 Series A 31⁄4% Convertible Notes due 2023 (each a
“Note”
and
      collectively, the “Notes”);

            

            WHEREAS,
      the Company
      has entered into the Agreement and Plan of Merger dated as of September 17,
      2006
      (the “Merger
      Agreement”)
      among
      the Company, Citizens and CF Merger Corp., a wholly owned subsidiary of Citizens
      (“Merger
      Subsidiary”),
      pursuant to which Merger Subsidiary will be merged with and into the Company
      (the “Merger”),
      whereupon the separate existence of Merger Subsidiary shall cease, and the
      Company shall be the surviving corporation and become a wholly owned subsidiary
      of Citizens;

     

            WHEREAS,
      pursuant to
      the Merger Agreement, at the effective time of the Merger (the “Effective
      Time”),
      each
      share of the Company’s outstanding common stock, par value $1.00 per share (the
“Common
      Shares”),
      shall
      be converted into the right to receive 0.768 shares of common stock, par value
      $0.25 per share, of Citizens (“Citizens’
      Stock”)
      and
      $31.31 in cash, without interest (collectively, the “Merger
      Consideration”);

            

            WHEREAS,
      Section
      12.01 of the Base Indenture provides that the Company shall only consolidate
      or
      merge with or into any other Person or Persons (whether or not affiliated with
      the Company) upon certain terms and upon the satisfaction of certain conditions
      specified therein;

     

            WHEREAS,
      pursuant to
      Section 15.07(a) of the Base Indenture, following the consummation of the
      Merger, the Company and Citizens shall execute with the Trustee a supplemental
      indenture, which shall provide for the conversion and settlement of the Notes
      as
      set forth in the Base Indenture and include additional provisions to protect
      the
      interests of the holders of the Notes;

     

            WHEREAS,
      Section
      11.01(a) of the Base Indenture provides that the Company, when authorized by
      the
      resolutions of the Board of Directors, and the Trustee may, from time to time,
      and at any time, without the consent of any Noteholders, enter into an indenture
      or indentures supplemental thereto to make provisions with respect to the
      conversion rights of the Noteholders pursuant to the requirements of Section
      15.07 of the Base Indenture and the repurchase obligations of the Company
      pursuant to the requirements of Section 3.05(e) of the Base
      Indenture;

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

            WHEREAS,
      pursuant to
      Section 11.05 of the Base Indenture, the Trustee was provided with an Officers’
Certificate and an Opinion of Counsel as conclusive evidence that this First
      Supplemental Indenture complies with the requirements of Article 11 of the
      Base
      Indenture and is otherwise authorized or permitted by the Base Indenture;
      and

     

            WHEREAS,
      all things
      necessary to make this First Supplemental Indenture a valid agreement of the
      Company, Citizens and the Trustee, and a valid supplement to the Base Indenture,
      have been done.

     

            NOW,
      THEREFORE, THIS
      FIRST SUPPLEMENTAL INDENTURE WITNESSETH:

     

            For
      and in
      consideration of the premises, the parties hereby mutually agree, for the
      benefit of the Company and the equal and proportionate benefit of all
      Noteholders, as follows:

     

     

    ARTICLE
      1

    AUTHORIZATION;
      DEFINITIONS

     

            Section
      1.01.
      First Supplemental Indenture.
      This
      First Supplemental Indenture is supplemental to, and is entered into in
      accordance with Section 11.01 of the Base Indenture, and except as modified,
      amended and supplemented by this First Supplemental Indenture, the provisions
      of
      the Base Indenture are in all respects ratified and confirmed and shall remain
      in full force and effect.

     

            Section
      1.02.
      Capitalized Terms. Capitalized
      terms used herein but not defined shall have the meanings assigned to them
      in
      the Base Indenture.

     

     

    ARTICLE
      2

    AMENDMENTS
      TO THE BASE INDENTURE

     

            Section
      2.01.
      Amendments To The Base Indenture. The
      Base
      Indenture is hereby amended in the following manner:

     

            (a) The
      following definitions shall be added to Section 1.01 of the Base
      Indenture:

     

            “Citizens”
means
      Citizens Communications Company.

     

            “First
      Supplemental Indenture”
means
      the First Supplemental Indenture dated as of March 8, 2007 among the Company,
      Citizens, and the Trustee.

     

            “Per
      Note Unit Value”
means,
      on any date and with respect to each $1,000 principal amount of Note, the sum
      of
      (i) $804.84 in cash, without interest and (ii) the product of (x) 0.768 shares
      of Citizens’ common stock, par value $0.25 per share (“Citizens’
      Stock”),
      (y)
      the Conversion Rate then in effect and (z) the Closing Sale Price of Citizens’
Stock on such date.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

            “Per
      Share Unit Value”
means,
      on any date, the sum of (i) 0.768 shares of Citizens’ Stock multiplied by the
      Closing Sale Price of Citizens’ Stock on such date and (ii) $31.31 in cash,
      without interest; provided
      that, if
      the Conversion Rate is adjusted, the 0.768 amount (as it may previously have
      been adjusted) shall be adjusted by the same percentage amount as the adjustment
      to the Conversion Rate.

     

            “Unit”
means,
      on any date of determination and with respect to each $1,000 principal amount
      of
      Notes, (i) 0.768 shares of Citizens’ Stock multiplied by the Conversion Rate
      then in effect and (ii) $804.84 in cash, without interest.

     

            (b) The
      definition of “Common Stock” in Section 1.01 of the Base Indenture shall be
      amended, effective as of the Effective Time of the Merger, by replacing it
      in
      its entirety with the following:

     

            “Common
      Stock”
means
      any stock of any class of Citizens which has no preference in respect of
      dividends or of amounts payable in the event of any voluntary or involuntary
      liquidation, dissolution or winding up of Citizens and which is not subject
      to
      redemption by Citizens. Subject to the provisions of Section 15.07,
      however, shares issuable on conversion of Notes shall include only shares of
      the
      class designated as common stock of Citizens at the date of the First
      Supplemental Indenture (namely, Citizens’ common stock, par value $0.25 per
      share) or shares of any class or classes resulting from any reclassification
      or
      reclassifications thereof and which have no preference in respect of dividends
      or of amounts payable in the event of any voluntary or involuntary liquidation,
      dissolution or winding up of Citizens and which are not subject to redemption
      by
      Citizens;
      provided
      that if
      at any time there shall be more than one such resulting class, the shares of
      each such class then so issuable on conversion shall be substantially in the
      proportion which the total number of shares of such class resulting from all
      such reclassifications bears to the total number of shares of all such classes
      resulting from all such reclassifications.

     

            (c) The
      definition of “Conversion Obligation” in Section 1.01 and 15.03(a) of the Base
      Indenture shall be amended by replacing it in its entirety in Section 1.01
      with
      the following:

     

            “Conversion
      Obligation”
has
      the
      meaning specified in Section 15.01(a).

     

            (d) Each
      instance of the term “Conversion Obligation” in the definition of “Cash
      Settlement Averaging Period”, and Section 15.02 of the Base Indenture shall be
      replaced with the phrase “Conversion Obligation constituting Common
      Stock”.

     

            (e) The
      definition of “Daily Conversion Value Amount” in Section 1.01 of the Base
      Indenture shall be amended only with regard to Trading Days occurring on or
      after the close of business on the effective date of the Merger by replacing
      it
      in its entirety with the following:

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

            “Daily
      Conversion Value Amount”
means,
      for each Trading Day during any Cash Settlement Averaging Period, and for each
      $1,000 principal amount of Notes, the amount equal to (x) the sum of (i) $804.84
      and (ii) the product of (1) the Closing Sale Price of the Common Stock on such
      Trading Day multiplied by (2) the Conversion Rate in effect on such Trading
      Day
      multiplied by (3) 0.768, divided by (y) 20.

     

            (f) The
      definition of “Daily Share Amount” in Section 1.01 of the Base Indenture shall
      be amended only with regard to Trading Days occurring on or after the close
      of
      business on the effective date of the Merger by replacing it in its entirety
      with the following:

     

            “Daily
      Share Amount”
means,
      for each Trading Day during any Cash Settlement Averaging Period and for each
      $1,000 principal amount of Notes, a number of shares of Common Stock (but in
      no
      event less than zero) determined by the following formula:

     

    
      	
              (Conversion
                Rate in effect

              on
                such Trading Day)

            	
              x

            	
              (100%
                - Y%) x 0.768

            
	
               

            	
              20

            	 

    

    

    where
      Y%
      is equal to (i) in the case where the Settlement Method Election Notice sets
      forth a Specified Percentage pursuant to Section 15.03(b)(iii)(B)(2), such
      Specified Percentage or (ii) in the case where the Settlement Method Election
      Notice sets forth a Specified Dollar Amount pursuant to Section
      15.03(b)(iii)(B)(1), a percentage equal to (x) the result of (A) such Specified
      Dollar Amount divided by (B) the Stock Portion Conversion Value (as defined
      in
      Section 15.03) multiplied by (y) 100.

     

            The
      Daily Share
      Amount for any Trading Day during any Cash Settlement Averaging Period shall
      be
      subject to adjustment by the Company in the event that an event requiring an
      adjustment to the Conversion Rate occurs subsequent to such Trading Day but
      prior to the date that the Daily Share Amount for such Trading Day is delivered
      to holders pursuant to Section 15.03.

     

            (g) Paragraph
      (iv) of the definition of “Outstanding” in Section 1.01 of the Base Indenture
      shall be amended by deleting the phrase “into Common Stock”.

     

            (h) Section
      3.05(e) of the Base Indenture shall be amended by replacing it in its entirety
      with the following:

    

    
      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

    

     

            “(e) In
      the
      case of a reclassification, change, consolidation, merger, combination, sale
      or
      conveyance to which Section 15.07 applies, in which the Common Stock is changed
      or exchanged as a result into the right to receive stock, securities or other
      property or assets (including cash), which includes shares of Common Stock
      or
      shares of common stock of another Person that are, or upon issuance will be,
      traded on a United States national securities exchange or approved for trading
      on an established automated over-the-counter trading market in the United States
      and such shares constitute at the time such change or exchange becomes
      effective in excess of 50% of the aggregate Fair Market Value of such stock,
      securities or other property or assets (including cash) (as determined by the
      Company, which determination shall be conclusive and binding), then the Person
      formed by such consolidation or resulting from such merger or which acquires
      such assets, as the case may be, shall execute and deliver to the Trustee a
      supplemental indenture (accompanied by an Opinion of Counsel that such
      supplemental indenture complies with the Trust Indenture Act as in force at
      the
      date of execution of such supplemental indenture) modifying the provisions
      of
      this Indenture relating to the right of holders of the Notes to cause the
      Company to repurchase the Notes following a Designated Event, including without
      limitation the applicable provisions of this Section 3.05 and the definitions
      of
      Common Stock and Designated Event, as appropriate, as determined in good faith
      by the Company (which determination shall be conclusive and binding), to make
      such provisions apply to such other Person if different from Citizens and the
      common stock issued by such Person (in lieu of Citizens and the Common Stock
      of
      Citizens).”

     

            (i) Section
      15.01 of the Base Indenture shall be amended by replacing it in its entirety
      with the following:

     

            “Section
      15.01. Right
      To Convert.
      (a) Subject to and upon compliance with the provisions of this Indenture,
      prior to the close of business on the Business Day immediately preceding
      July 15, 2023, the holder of any Note shall have the right, at such
      holder’s option, to convert the principal amount of the Note, or any portion of
      such principal amount which is a multiple of $1,000, into cash and fully paid
      and non-assessable shares of Common Stock (as such shares shall then be
      constituted) constituting a Unit (the “Conversion
      Obligation”),
      subject to the Company’s right to elect to deliver cash or a combination of cash
      and Common Stock in lieu of Common Stock then constituting a portion of such
      Unit pursuant to Section 15.03, by surrender of the Note so to be converted
      in whole or in part, together with any required funds, under the circumstances
      described in this Section 15.01 and in the manner provided in Section 15.02.
      The
      Notes shall be convertible only upon the occurrence of one of the following
      events:

     

            (i) during
      any Fiscal Quarter (and only during such Fiscal Quarters) commencing after
      June 30, 2005, if the Per Share Unit Value exceeds 120% of the
      then-effective Conversion Price for at least 20 Trading Days in the
      30 consecutive Trading Day period ending on the last Trading Day of the
      immediately preceding Fiscal Quarter (it being understood for purposes of this
      Section 15.01(a)(i) that the Conversion Price in effect at the close of business
      on each of the 30 consecutive Trading Days should be used);

     

           (ii) during
      the five Business Day period immediately following any five consecutive Trading
      Day period (the “Measurement
      Period”)
      in
      which the Trading Price per $1,000 principal amount of the Notes for each day
      of
      such Measurement Period was less than 98% of the Per Note Unit Value on such
      date;
      provided
      that
no
      conversion pursuant to this clause (ii)
      may be made after July 15, 2018, if on any Trading Day during the
      Measurement Period, the Per Share Unit Value
      is
      more than 100%, but less than 120% of the Conversion Price on such Trading
      Day;

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

            (iii) if
      such
      Note has been called for redemption, at any time on or after the date the notice
      of redemption has been given until the close of business on the second Business
      Day immediately preceding the redemption date; or

     

                    (iv) as
      provided in Section (b) of this Section 15.01.

     

            The
      Trustee (or other
      conversion agent appointed by the Company) shall, on behalf of the Company,
      determine on a daily basis during the time period specified in Section
      15.01(a)(i) whether the Notes shall be convertible as a result of the occurrence
      of an event specified in clause (i) above and, if the Notes shall be so
      convertible, the Trustee (or other conversion agent appointed by the Company)
      shall promptly deliver to the Company and the Trustee (if the Trustee is not
      the
      conversion agent) written notice thereof. Whenever the Notes shall become
      convertible pursuant to this Section 15.01, the Company or, at the Company’s
      request, the Trustee in the name and at the expense of the Company, shall notify
      the holders of the event triggering such convertibility in the manner provided
      in Section 16.03, and the Company shall also publicly announce such information
      and publish it on the Company’s web site. Any notice so given shall be
      conclusively presumed to have been duly given, whether or not the holder
      receives such notice.

     

            The
      Trustee (or other
      conversion agent appointed by the Company) shall have no obligation to determine
      the Trading Price under this Section 15.01 unless the Company has requested
      such
      a determination; and the Company shall have no obligation to make such request
      unless a holder provides it with reasonable evidence that the Trading Price
      per
      $1,000 principal amount of Notes would be less than 98% of the Per Note Unit
      Value. If such evidence is provided, the Company shall instruct the Trustee
      (or
      other conversion agent) to determine the Trading Price of the Notes beginning
      on
      the next Trading Day and on each successive Trading Day until the Trading Price
      per $1,000 principal amount of Notes is greater than or equal to 98% of the
      Per
      Note Unit Value; provided
      that the
      Trustee shall be under no duty or obligation to make the calculations described
      in Section 15.01(a)(ii) hereof or to determine whether the Notes are convertible
      pursuant to such section. For the avoidance of doubt, the Company shall make
      the
      calculations described in Section 15.01(a)(ii), using the Trading Price provided
      by the Trustee.

     

            The
      Trustee shall be
      entitled at its sole discretion to consult with the Company and to request
      the
      assistance of the Company in connection with the Trustee’s duties and
      obligations pursuant to Section 15.01(a)(i) and Section 15.01(a)(ii) hereof
      (including without limitation the calculation or determination of the Conversion
      Price, the Closing Sale Price and the Trading Price), and the Company agrees,
      if
      requested by the Trustee, to cooperate with, and provide assistance to, the
      Trustee in carrying out its duties under this Section 15.01; provided
      that
      nothing herein shall be construed to relieve the Trustee of its duties pursuant
      to Section 15.01(a)(i) and Section 15.01(a)(ii) hereof.

     

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

            (b) In
      addition, if:

     

           (i) (A) Citizens
      distributes to all holders of its Common Stock rights or warrants entitling
      them
      (for a period expiring within 45 days of the record date for the determination
      of the stockholders entitled to receive such distribution) to subscribe for
      or
      purchase shares of Common Stock, at a price per share less than the average
      of
      the Closing Sale Price of the Common Stock for the ten Trading Days immediately
      preceding, but not including, the date such distribution is first publicly
      announced by the Company, or (B) Citizens distributes to all holders of its
      Common Stock, cash or other assets, debt securities or rights to purchase its
      securities, where the Fair Market Value of such distribution per share of Common
      Stock exceeds 5% of the Closing Sale Price of the Common Stock on the Trading
      Day immediately preceding the date such distribution is first publicly announced
      by Citizens, then, in either case, the Notes may be surrendered for conversion
      at any time on and after the date that Citizens gives notice to the holders
      of
      such distribution, which shall be not less than 20 days prior to the Record
      Date for such distribution, until the earlier of the close of business on the
      fourth Business Day immediately preceding, but not including, the Record Date
      or
      the date Citizens publicly announces that such distribution will not take
      place;
      provided
      that if
      the holder will otherwise participate in such distribution without conversion
      (as if such holder had held a number of shares equal to the Conversion Rate
      multiplied by 0.768), neither any adjustment to the Conversion Rate will be
      made
      nor will a holder of a Note have the ability to convert pursuant to this Section
      15.01(b); or

     

            (ii) Citizens
      consolidates with or merges with or into another Person or is a party to a
      binding share exchange or conveys, transfers, sells, leases or otherwise
      disposes of all or substantially all of its properties and assets in each case
      pursuant to which the Common Stock is converted into cash, securities or other
      property, then the Notes may be surrendered for conversion at any time from
      and
      after the date fifteen (15) days prior to the anticipated effective date of
      the transaction and ending on and including the date fifteen (15) days
      after the consummation of the transaction. If such transaction constitutes
      a
      Designated Event, the Notes may be surrendered for conversion until the
      corresponding Designated Event Repurchase Date. In such an event, a holder
      of
      Notes may elect to exercise its option to require the Company to repurchase
      all
      or a portion of such holder’s Notes pursuant to Section 3.05. The Board of
      Directors shall determine the anticipated effective date of the transaction,
      and
      such determination shall be conclusive and binding on the holders and shall
      be
      publicly announced by the Company and posted on its web site not later than
      two
      Business Days prior to such 15th day.

     

     

            (c) A
      Note in
      respect of which a holder is electing to exercise its option to require the
      Company to repurchase such holder’s Notes upon a Designated Event pursuant to
      Section 3.05, or at the option of the holder pursuant to Section 3.06, may
      be converted only if such holder withdraws its election in accordance with
      Section 3.05(c) or Section 3.08, respectively. A holder of Notes is not entitled
      to any rights of a holder of Common Stock until such holder has converted his
      Notes to Units, subject to the Company’s right to settle the related Common
      Stock portion of the Conversion Obligation partly or wholly in cash pursuant
      to
      Section 15.03, and only to the extent such Notes are deemed to have been
      converted to Common Stock under this Article 15.”

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

            (j) The
      third
      paragraph of Section 15.02 of the Base Indenture shall be amended by replacing
      it in its entirety with the following:

     

            “Following
      satisfaction of the requirements for conversion set forth above, subject to
      compliance with any restrictions on transfer if shares issuable on conversion
      are to be issued in a name other than that of the Noteholder (as if such
      transfer were a transfer of the Note or Notes (or portion thereof) so
      converted), the Company shall deliver to such Noteholder at the office or agency
      maintained by the Company for such purpose pursuant to Section 5.02, for each
      $1,000 principal amount of Note, the cash and number of full shares of Common
      Stock (and cash in respect of any fractional interest in respect of a share
      of
      Common Stock arising upon such conversion, calculated by the Company as provided
      in Section 15.04) then constituting a Unit on such Conversion Date, subject
      to
      the Company’s right to elect to deliver cash in lieu of shares of Common Stock
      pursuant to Section 15.03. In case any Note of a denomination greater than
      $1,000 shall be surrendered for partial conversion, and subject to Section
      2.03,
      the Company shall execute and the Trustee shall authenticate and deliver to
      the
      holder of the Note so surrendered, without charge to him, a new Note or Notes
      in
      authorized denominations in an aggregate principal amount equal to the
      unconverted portion of the surrendered Note.”

     

            (k) The
      seventh and eighth paragraphs of Section 15.02 of the Base Indenture shall
      be
      amended by replacing them in their entirety with the following:

     

            “Upon
      the conversion
      of a Note, that portion of the accrued but unpaid Interest, including accrued
      Contingent Interest, if any, to the Conversion Date, with respect to the
      converted Note shall not be cancelled, extinguished or forfeited, but rather
      shall be deemed to be paid in full to the holder thereof through delivery of
      the
      cash and Common Stock (together with the cash payment, if any in lieu of
      fractional shares) in exchange for the Note being converted pursuant to the
      provisions hereof; and the cash and the Fair Market Value of such shares of
      Common Stock (together with any such cash payment in lieu of fractional shares)
      shall be treated as delivered, to the extent thereof, first in exchange for
      and
      in satisfaction of our obligation to pay the principal amount of the converted
      Note, the accrued but unpaid Interest, including Contingent Interest, if any,
      through the Conversion Date and the balance, if any, of such cash and the Fair
      Market Value of such Common Stock (and any such cash payment in lieu of
      fractional shares) shall be treated as delivered in exchange for and in
      satisfaction of the right to convert the Note being converted pursuant to the
      provisions hereof.

     

            The
      Company agrees,
      and by acceptance of a beneficial interest in a Note each holder and any
      beneficial owner of a Note shall be deemed to have agreed to treat, for United
      States federal income tax purposes, the cash and the Fair Market Value of the
      Common Stock received upon a conversion of the Note (together with any cash
      payment in
      lieu
      of fractional shares) as a contingent payment on the Note for purposes of
      Treasury Regulation Section 1.1275-4 or any successor
      provision.”

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

            (l) Section
      15.03 of the Base Indenture shall be amended by replacing it in its entirety
      with the following:

     

            “Section
      15.03. Settlement
      Upon Conversion.
      (a) In
      addition to delivering $804.84 in cash per $1,000 principal amount of Notes
      converted, the Company may satisfy all or any portion of the Conversion
      Obligation constituting Common Stock (and not, for the avoidance of doubt,
      the
      portion in cash) upon conversion of Notes in cash or in a combination of cash
      and shares of Common Stock selected by the Company, in accordance with clause
      (b) and (c) of this Section 15.03.
      If the
      Company does not elect to satisfy all or any portion of the Conversion
      Obligation constituting Common Stock as set forth in clause (b) and (c) below,
      the Company shall deliver, as soon as practicable after the third Trading Day
      following the related Conversion Date, for each $1,000 principal amount of
      Note,
      the cash and number of shares of Common Stock (together with the cash payment,
      if any, in lieu of fractional shares) then
      constituting a Unit on such Conversion Date.

     

            (b) If
      the
      Company chooses to satisfy all or any portion of the Conversion Obligation
      constituting Common Stock in cash pursuant to clause (a) of this
      Section 15.03, the Company will notify the holder through the Trustee of
      the method chosen by the Company to satisfy the Conversion Obligation
      constituting Common Stock (such notice, the “Settlement
      Method Election Notice”)
      at any
      time on or before the date that is two Trading Days following the Conversion
      Date (the “Settlement
      Method Notice Period”).
      If
      the Company timely elects to pay cash (other than cash in lieu of fractional
      shares) for any portion of the shares of Common Stock then constituting the
      Conversion Obligation otherwise issuable to such holder, the Conversion Notice
      may be retracted by the holder at any time during the two Trading Day period
      (the “Conversion
      Retraction Period”)
      beginning on the Trading Day after the final day of the Settlement Method Notice
      Period; provided that no such retraction can be made (and a Conversion Notice
      shall be irrevocable) if (x) the Conversion Date occurs during the period
      beginning on, and including, any Notice Date and ending on, and including,
      the
      redemption date specified in the related notice of redemption or (y) the
      Conversion Date occurs during the period beginning twenty-five scheduled Trading
      Days preceding the maturity date and ending one Trading Day preceding the
      maturity date. Settlement amounts will be computed as follows:

     

           (i) If
      the
      Company elects to satisfy the entire Conversion Obligation relating to Common
      Stock in cash, the Company will deliver to holders surrendering Notes for
      conversion cash in an amount equal to the sum of the Daily Conversion Value
      Amounts for each of the Trading Days in the relevant Cash Settlement Averaging
      Period (such sum, the “Conversion
      Value”);
      and

     

    
      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

           (ii) If
      the
      Company elects to satisfy in cash a fixed portion of the Conversion Obligation
      relating to Common Stock other than the entire obligation, or
      a
      percentage of the Conversion Obligation relating to Common Stock other than
      100%, the Company will deliver to holders surrendering Notes for
      conversion:

     

                       (A) an
      amount
      in cash equal to $804.84 per $1,000 principal amount of Notes to be
      converted;

     

        (B) an
      amount
      in cash equal to either (1) the dollar amount per $1,000 principal amount of
      Notes to be converted that is specified in the Settlement Method Election Notice
      (the “Specified
      Dollar Amount”)
      or (2)
      the percentage (other than 100%) of the Conversion Obligation relating to Common
      Stock specified in the Settlement Method Election Notice (the “Specified
      Percentage”)
      multiplied by the sum of, for each Trading Day during the related Cash
      Settlement Averaging Period, and for each $1,000 principal amount of Notes,
      0.768 multiplied by the Conversion Rate then in effect multiplied by the Closing
      Sale Price of the Common Stock on such Trading Day, divided by 20 (such sum,
      the
“Stock
      Portion Conversion Value”);
      and

     

        (C) a
      number
      of whole shares of Common Stock per $1,000 principal amount of Notes to be
      converted equal to the sum of the Daily Share Amounts for each of the Trading
      Days in the relevant Cash Settlement Averaging Period (provided that the Company
      will deliver cash in lieu of fractional shares in accordance with
      Section 15.04).

     

    Settlement
      pursuant to Sections 15.03(b)( i) and 15.03(b)(ii) will occur on the third
      Trading Day following the final Trading Day of the relevant Cash Settlement
      Averaging Period.

     

            (c) Notwithstanding
      the procedures set forth in Section 15.03(b), in the event that a
      Conversion Date occurs on or following the twenty-fifth scheduled Trading Day
      prior to July 15, 2023 (the “Final
      Notice Date”)
      or
      during the period beginning on, and including, any Notice Date and ending on,
      and including, the redemption date specified in the related notice of
      redemption, the Company will not be required to send individual Settlement
      Method Election Notices. Instead, if the Company chooses to satisfy all or
      any
      portion of the Conversion Obligation constituting Common Stock in cash with
      respect to Conversion Dates occurring on or after the Final Notice Date or
      with
      respect to Conversion Dates occurring during the period beginning on, and
      including, any Notice Date and ending on, and including, the redemption date
      specified in the related notice of redemption, the Company must send a single
      Settlement Method Election Notice to the Trustee on the Final Notice Date with
      respect to any Conversion Dates occurring on or after the Final Notice Date
      or
      on any Notice Date with respect to any Conversion Dates occurring during the
      period beginning on, and including, such Notice Date and ending on and
      including, the redemption date specified in the related notice of 
      redemption.
        Settlement amounts will be computed in the same manner as set forth under
        Section 15.03(b) above.

    

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

            (d) A
      Conversion Notice may be withdrawn by means of a written notice of withdrawal
      delivered to the office of the Trustee (or other paying agent appointed by
      the
      Company) in accordance with the Settlement Method Election Notice at any time
      prior to the close of business of the final day of the Conversion Retraction
      Period, specifying:

     

     
     (i) the
      certificate number, if any, of the Note in respect of which such notice of
      withdrawal is being submitted, or the appropriate Depositary information if
      the
      Note in respect of which such notice of withdrawal is being submitted is
      represented by a Global Note,

     

           (ii) the
      principal amount of the Note, in integral multiples of $1,000, with respect
      to which such notice of withdrawal is being submitted, and

     

       (iii) the
      principal amount, if any, of such Note which remains subject to conversion
      in
      accordance with such Settlement Method Election Notice and which has been or
      will be surrendered for conversion.”

     

            (m) The
      first
      paragraph of Section 15.07 of the Base Indenture shall be amended such that
      references to “the Company” shall mean “Citizens”. Section 15.07(a) of the Base
      Indenture shall be amended such that the reference to “the Company” shall mean
“the Company and Citizens”.

     

            (n) The
      first
      paragraph of Section 15.07(b) of the Base Indenture shall be amended by
      replacing it in its entirety with the following:

     

            “(b) Notwithstanding
      the provisions of Section 15.03, and subject to the provisions of Section 15.01,
      on and after the effective date of such reclassification, change, consolidation
      merger, combination, sale or conveyance, each $1,000 principal amount Note
      shall
      be convertible into (i) $804.84 in cash, without interest and, (ii) subject
      to
      the Company’s right to settle the related Conversion Obligation constituting
      Common Stock in cash as set forth in this Section 15.07, the kind and amount
      of
      shares of stock and other securities or property or assets (including cash)
      or
      any combination thereof received upon such reclassification, change,
      consolidation, merger, combination, sale or conveyance by a holder of Common
      Stock holding, immediately prior to the transaction, a number of shares of
      Common Stock equal to the Conversion Rate immediately prior to such transaction
      multiplied by 0.768 (the “Exchange Property”), assuming such holder of Common
      Stock did not exercise his rights of election, if any, as to the kind or amount
      of securities, cash or other property receivable upon such reclassification,
      change, consolidation, merger, combination, sale or conveyance (provided that,
      if the kind or amount of securities, cash or other property receivable upon
      such
      reclassification, change, consolidation, merger, combination, sale or conveyance
      is not the same for each share of Common Stock in respect of which such rights
      of 
      election
        shall not have been exercised (“non-electing share”), then for the purposes of
        this Section 15.07 the kind and amount of securities, cash or other property
        receivable upon such reclassification, change, consolidation, merger,
        combination, sale or conveyance for each non-electing share shall be deemed
        to
        be the kind and amount so receivable per share by a plurality of the
        non-electing shares). Such
        supplemental indenture shall provide for adjustments which shall be as nearly
        equivalent as may be practicable to the adjustments provided for in this
        Article 15.”

    

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

            (o) Sections
      15.07(c) and (d) of the Base Indenture shall be amended by replacing them in
      their entirety with the following:

     

            “(c) (i)
      Settlement of Notes tendered for conversion on or after the second Trading
      Day
      immediately preceding the effective date of any such transaction shall be as
      set
      forth in Section 15.03(a) by delivery of, for each $1,000 principal amount
      of
      Notes tendered (1) $804.84 in cash and (2) either (A) the Exchange Property, (B)
      if the Company elects to pay cash in lieu of the entire Exchange Property in
      the
      manner set forth in Section 15.03(b), cash in an amount equal to the Exchange
      Property Value (as defined below) or (C) if the Company elects to pay cash
      in
      lieu of only a portion of Exchange Property in the manner set forth in Section
      15.03(b), a combination of units of Exchange Property and cash determined
      pursuant to clause (d) below.

     

            (ii) For
      purposes of the foregoing, “Exchange
      Property Value”
means
      the sum of the Daily Conversion Value Amounts for each of the Trading Days
      in
      the relevant Cash Settlement Averaging Period determined as set forth in the
      definition of “Daily Conversion Value Amount,” except that for purposes of
      determining the Exchange Property Value, the “Daily Conversion Value Amount”
shall mean, for each Trading Day during relevant Cash Settlement Averaging
      Period and for each $1,000 principal amount of Notes, an amount equal to the
      product of (i) 1/20 and (ii) the value of cash, securities and other property
      constituting the Exchange Property determined as follows:

     

        (A) Any
      shares of common stock of the successor or purchasing corporation or any other
      corporation that are included in the Exchange Property shall be valued as set
      forth in Section 15.03 using the procedures set forth in the definition of
      “Closing Sale Price” in Section 1.01; and

     

        (B) Any
      other
      property (other than cash) included in the Exchange Property shall be valued
      in
      good faith by the Board of Directors or by a New York Stock Exchange member
      firm
      selected by the Board of Directors.

     

            (d) If
      the
      Company elects to satisfy in cash a fixed portion of the obligation to deliver
      Exchange Property (other than the entire obligation) or a percentage of such
      obligation (other than 100%), the Company will deliver cash and a partial unit
      of Exchange Property based on the Exchange Property Value and the portions
      selected by the
      Company in a manner determined by the Company consistent with Section
      15.03(b)(ii) hereof and this Section 15.07.”

     

            (p) Section
      15.10 of the Base Indenture shall be amended by replacing it in its entirety
      with the following:

     

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

     

            “Section
      15.10.
      Responsibility Of Trustee.
      The
      Trustee and any other conversion agent shall not at any time be under any duty
      or responsibility to any holder of Notes to determine the Conversion Rate or
      whether any facts exist which may require any adjustment of the Conversion
      Rate,
      or with respect to the nature or extent or calculation of any such adjustment
      when made, or with respect to the method employed, or herein or in any
      supplemental indenture provided to be employed, in making the same. The Trustee
      and any other conversion agent shall not be accountable with respect to the
      validity or value (or the kind or amount) of any shares of Common Stock, or
      of
      any securities or property, which may at any time be issued or delivered upon
      the conversion of any Note; and the Trustee and any other conversion agent
      make
      no representations with respect thereto. Neither the Trustee nor any conversion
      agent shall be responsible for any failure of the Company and Citizens to issue,
      transfer or deliver any shares of Common Stock or stock certificates or other
      securities or property or cash upon the surrender of any Note for the purpose
      of
      conversion or to comply with any of the duties, responsibilities or covenants
      of
      the Company and Citizens contained in this Article 15. Without limiting the
      generality of the foregoing, neither the Trustee nor any conversion agent shall
      be under any responsibility to determine the correctness of any provisions
      contained in any supplemental indenture entered into pursuant to Section 15.07
      relating either to the kind or amount of shares of stock or securities or
      property (including cash) receivable by Noteholders upon the conversion of
      their
      Notes pursuant to the Company’s election rights in Section 15.03 or after
      any event referred to in such Section 15.07 or to any adjustment to be made
      with
      respect thereto, but, subject to the provisions of Section 8.01, may accept
      as
      conclusive evidence of the correctness of any such provisions, and shall be
      protected in relying upon, the Officers’ Certificate (which the Company shall be
      obligated to file with the Trustee prior to the execution of any such
      supplemental indenture) with respect thereto.”

     

            (q) Sections
      15.09, 15.11 and 15.12 of the Base Indenture shall be amended such that
      references to “the Company” shall mean “Citizens”.

     

     

    ARTICLE
      3

    BASE
      INDENTURE OBLIGATIONS

     

            Section
      3.01.
      Reaffirmation Of Obligations. Pursuant
      to Section 12.01(ii) of the Base Indenture, the Company hereby reaffirms its
      obligations under the Base Indenture to pay the principal of and Interest on
      all
      of the Notes, according to their tenor, and to perform and observe all of the
      covenants and conditions contained in the Base Indenture to be performed by
      the
      Company.

     

     

    ARTICLE
      4

    MERGER-RELATED
      MECHANICS

     

            Section
      4.01.
      Conversion Mechanics. For
      the
      avoidance of doubt, the amendments herein to Sections 15.01 and 15.03 of the
      Base Indenture shall not nullify elections to convert Notes made before the
      Effective Time of the Merger.

     

    
      
                Section
          4.02.
          Repurchase and Conversion Upon Designated Event. For
          the
          avoidance of doubt, notwithstanding the provisions herein, the Merger shall
          constitute a “Designated Event” under the Base Indenture. Each Noteholder’s
          right to require the Company to repurchase all of such holder’s Notes (or any
          portion thereof that is a multiple of $1,000 principal amount) as a result
          of
          the Merger, pursuant to Section 3.05 of the Base Indenture, shall survive,
          notwithstanding this First Supplemental Indenture. Furthermore, each
          Noteholder’s right to convert such holder’s Notes until the Designated Event
          Repurchase Date related to the Merger, pursuant to Section 15.01(b)(ii)
          of the
          Base Indenture, shall survive, notwithstanding this First Supplemental
          Indenture, provided
          that the
          cash and Common Stock deliverable in respect of any Notes so tendered for
          conversion will be determined as provided in the Base Indenture as amended
          by
          this First Supplemental Indenture.

         

      

      
        
          
          

        

        
          14

          
            

          

        

        
          
          

        

      

    

     

    ARTICLE
      5

    CONVERSION
      RATE ADJUSTMENTS

     

            Section
      5.01.
      Conversion Rate. Effective
      as of the date hereof, the Conversion Rate shall be adjusted from time to time
      by the Company upon the occurrence of an event with respect to Citizens which
      would have required an adjustment to the Conversion Rate pursuant to Section
      15.06 of the Base Indenture if such event had occurred with respect to the
      Company prior to the Merger in a manner equivalent to the adjustment to the
      Conversion Rate which would have been required pursuant to Article 15 of the
      Base Indenture if such event had occurred with respect to the Company prior
      to
      the Merger. For the avoidance of doubt, effective as of the date hereof, the
      Conversion Rate shall not be adjusted upon the occurrence of an event with
      respect to the Company which would have required an adjustment to the Conversion
      Rate pursuant to Section 15.06 of the Base Indenture if such event had occurred
      prior to the date hereof.

     

     

    ARTICLE
      6

    GUARANTEE
      OF
      CITIZENS

     

            Section
      6.01.
      Guarantee. By its execution hereof, the Guarantor acknowledges and agrees
      that it receives substantial benefits from the Company and that the Guarantor
      is
      providing its Guarantee for good and valuable consideration, including, without
      limitation, such substantial benefits. Accordingly, subject to the provisions
      of
      this Article 6, the Guarantor hereby unconditionally guarantees to each Holder
      of a Note authenticated and delivered (whether before or after the date of
      this
      First Supplemental Indenture) by the Trustee and its successors and assigns
      that: (i) the principal of (including the redemption price or repurchase
      price upon redemption or repurchase pursuant to Article 3 of the Base
      Indenture), and interest on the Notes shall be duly and punctually paid in
      full
      when due, whether at the maturity date of the Notes, upon acceleration, upon
      redemption, upon a repurchase, upon repurchase due to a Designated Event or
      otherwise, and interest on overdue principal, and (to the extent permitted
      by
      law) interest on any interest, if any, on the Notes and all other obligations
      of
      the Company to the Holders (including, without limitation, in connection with
      a
      conversion of Notes) or the Trustee hereunder or under the Notes (including
      fees, expenses or other) shall be promptly paid in full or performed, all in
      accordance with the terms hereof; and (ii) in case of any extension of time
      of
      payment or renewal of any Notes or any of such other obligations, the same
      shall
      be promptly paid in full when due or performed in accordance with the terms
      of
      the extension or renewal, whether at the maturity date of the Notes, by
      acceleration, call for redemption, upon repurchase, upon repurchase due to
      a
      Designated Event or otherwise, subject, however, in the case of clauses (i)
      and
      (ii) above, to the limitations set forth in Section 6.03 hereof (collectively,
      the “Guarantee Obligations”).

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

            Subject
      to the
      provisions of this Article 6, the Guarantor hereby agrees that its Guarantee
      hereunder shall be unconditional, irrespective of the validity, regularity
      or
      enforceability of the Notes or the Base Indenture (as amended by this First
      Supplemental Indenture), the absence of any action to enforce the same, any
      waiver or consent by any Holder of the Notes with respect to any thereof, the
      entry of any judgment against the Company, any action to enforce the same or
      any
      other circumstance which might otherwise constitute a legal or equitable
      discharge or defense of the Guarantor. The Guarantor hereby waives and
      relinquishes: (a) any right to require the Trustee, the Holders or the Company
      (each, a “Benefited Party”) to proceed against the Company or
      any other Person or to proceed against or exhaust any security held by a
      Benefited Party at any time or to pursue any other remedy in any secured party’s
      power before proceeding against the Guarantor; (b) any defense that may arise
      by
      reason of the incapacity, lack of authority, death or disability of any other
      Person or Persons or the failure of a Benefited Party to file or enforce a
      claim
      against the estate (in administration, bankruptcy or any other proceeding)
      of
      any other Person or Persons; (c) demand, protest and notice of any kind (except
      as expressly required by this Indenture), including but not limited to notice
      of
      the existence, creation or incurring of any new or additional indebtedness
      or
      obligation or of any action or non-action on the part of the Guarantor, the
      Company, any Benefited Party, any creditor of the Guarantor or the Company
      or on
      the part of any other Person whomsoever in connection with any obligations
      the
      performance of which are hereby guaranteed; (d) any defense based upon an
      election of remedies by a Benefited Party, including but not limited to an
      election to proceed against the Guarantor for reimbursement; (e) any defense
      based upon any statute or rule of law which provides that the obligation of
      a
      surety must be neither larger in amount nor in other respects more burdensome
      than that of the principal; (f) any defense arising because of a Benefited
      Party’s election, in any proceeding instituted under the Bankruptcy Law, of the
      application of Section 1111(b)(2) of the Bankruptcy Code; and (g) any defense
      based on any borrowing or grant of a security interest under Section 364 of
      the
      Bankruptcy Code. The Guarantor hereby covenants that, except as otherwise
      provided therein, the Guarantee shall not be discharged except by payment in
      full of all Guarantee Obligations, including
      the principal and interest on the Notes and all other costs provided for under
      the Base Indenture (as amended by this First Supplemental
      Indenture).

     

            If
      any Holder or the
      Trustee is required by any court or otherwise to return to either the Company
      or
      the Guarantor, or any trustee or similar official acting in relation to either
      the Company or the Guarantor, any amount paid by the Company or the Guarantor
      to
      the Trustee or such Holder, the Guarantee, to the extent theretofore discharged,
      shall be reinstated in full force and effect. The Guarantor agrees that it
      shall
      not be entitled to any right of subrogation in relation to the Holders in
      respect of any Guarantee Obligations hereby until payment in full of all such
      obligations guaranteed hereby. The Guarantor agrees that, as between it, on
      the
      one hand, and the Holders of Notes and the Trustee, on the other hand, (x)
      the
      maturity of the obligations guaranteed hereby may be accelerated as provided
      in
Article
      6
      of the Base Indenture
      for the
      purposes hereof, notwithstanding any stay, injunction or other prohibition
      preventing such acceleration in respect of the Guarantee Obligations, and (y)
      in
      the event of any acceleration of such obligations as provided in Article
      6
      of the Base Indenture,
      such
      Guarantee Obligations (whether or not due and payable) shall forthwith become
      due and payable by the Guarantor for the purpose of the Guarantee.

     

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

            Section
      6.02.
      Execution and Delivery of Guarantee. To evidence the Guarantee set forth in
      Section 6.01 hereof, the Guarantor agrees that a notation of the Guarantee
      substantially in the form included in Exhibit A hereto shall be endorsed on
      each
      Note authenticated and delivered by the Trustee and that this First Supplemental
      Indenture shall be executed on behalf of the Guarantor by an officer of the
      Guarantor.

     

            The
      Guarantor agrees
      that the Guarantee set forth in this Article 6 shall remain in full force and
      effect and apply to all the Notes notwithstanding any failure to endorse on
      each
      Note a notation of the Guarantee.

     

            If
      an officer whose
      facsimile signature is on a Note or a notation of Guarantee no longer holds
      that
      office at the time the Trustee authenticates the Note on which the Guarantee
      is
      endorsed, the Guarantee shall be valid nevertheless.

     

            The
      delivery of any
      Note by the Trustee, after the authentication thereof hereunder, shall
      constitute due delivery of the Guarantee set forth in this Indenture on behalf
      of the Guarantor.

     

            Section
      6.03.
      Limitation of Guarantor’s Liability; Certain Bankruptcy Events. It is the
      intention of the parties hereto that the Guarantee Obligations of the Guarantor
      pursuant to its Guarantee not constitute a fraudulent transfer or conveyance
      for
      purposes of any Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the
      Uniform Fraudulent Transfer Act or any similar federal or state law. To
      effectuate the foregoing intention, the parties hereto hereby irrevocably agree
      that the Guarantee Obligations of the Guarantor under this Article 6 shall
      be
      limited to the maximum amount as shall, after giving effect to all other
      contingent and fixed liabilities of the Guarantor, result in the Guarantee
      Obligations of the Guarantor under the Guarantee not constituting a fraudulent
      transfer or conveyance.

     

            Section
      6.04.
      Application of Certain Terms and Provisions to the Guarantor. For
      purposes of any provision of the Base Indenture (as amended by this First
      Supplemental Indenture) which provides for the delivery by the Guarantor of
      an
      Officers’ Certificate and/or an Opinion of Counsel, the definitions of such
      terms in Section 1.01 of the Base Indenture hereof shall apply to the Guarantor
      as if references therein to the Company or the Guarantor, as applicable, were
      references to the Guarantor.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

            Any
      request,
      direction or demand which by any provision of the Base Indenture (as amended
      by
      this First Supplemental Indenture) is to be made by the Guarantor shall be
      sufficient if evidenced as described in Section 16.03 of the Base Indenture
      as
      if references therein to the Company were references to the
      Guarantor.

     

            Any
      notice or demand
      which by any provision of the Base Indenture (as amended by this First
      Supplemental Indenture) is required or permitted to be given or served by the
      Trustee or by the Holders of Notes to or on the Guarantor may be given or served
      as described in Section 16.03 of the Base Indenture as if references therein
      to
      the Company were references to the Guarantor and addressed as follows: to
      Citizens Communications Company, 3 High Ridge Park, Stamford, Connecticut 06905,
      Attention, General Counsel, Telecopier No. 203-614-4651.

     

            Upon
      any demand,
      request or application by the Guarantor to the Trustee to take any action under
      the Base Indenture (as amended by this First Supplemental Indenture), the
      Guarantor shall furnish to the Trustee such certificates and opinions as are
      required in Section 16.05 of the Base Indenture as if all references therein
      to
      the Company were references to the Guarantor.

     

     

    ARTICLE
      7

    AUTHENTICATION
      OF NEW GLOBAL NOTE

     

            Section
      7.01.
      New
      Global Note. The
      Trustee shall (i) deliver and cancel the Global Note (numbered “No. 1”) in
      accordance with the standing procedures and instructions existing between the
      Depositary and the Custodian and (ii) authenticate a new Global Note
      substantially in the form set forth in Exhibit A hereto. The terms and
      provisions contained in the form of Note attached as Exhibit A hereto shall
      constitute, and are hereby expressly made, a part of the Base Indenture and,
      to
      the extent applicable, the Company, Citizens and the Trustee, by their execution
      and delivery of this First Supplemental Indenture, expressly agree to such
      terms
      and provisions and to be bound thereby.

     

     

    ARTICLE
      8

    MISCELLANEOUS

     

            Section
      8.01.
      Recitals. The
      recitals contained herein shall be taken as the statements of the Company and
      the Trustee assumes no responsibility for their correctness. The Trustee makes
      no representation as to the validity or sufficiency of this First
      Supplemental Indenture except that the Trustee represents that it is duly
      authorized to execute and deliver this First Supplemental Indenture and perform
      its obligations hereunder.

     

            Section
      8.02.
      Conflict with Trust Indenture Act. If
      any
      provision hereof limits, qualifies or conflicts with a provision of the Trust
      Indenture Act that is required under such Act to be a part of and govern this
      First Supplemental Indenture, the Trust Indenture Act shall control. If any
      provision of this First Supplemental Indenture modifies or excludes any
      provision of the Trust Indenture Act that may be so modified or excluded, the
      Trust Indenture Act shall be deemed to apply to this First Supplemental
      Indenture as so modified or to be excluded, as the case may be.

    

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

        Section
      8.03.
      Effect Of Headings. The
      Section headings herein are for convenience only and shall not affect the
      construction hereof.

     

            Section
      8.04.
      Successors and Assigns. All
      covenants and agreements in this First Supplemental Indenture by the Company
      shall bind its successors and assigns, whether so expressed or not.

     

            Section
      8.05.
      Separability Clause. In
      case
      any provision in this First Supplemental Indenture or in the Notes shall be
      invalid, illegal or unenforceable, the validity, legality and enforceability
      of
      the remaining provisions shall not in any way be affected or impaired
      thereby.

     

            Section
      8.06.
      Benefits of First Supplemental Indenture. Nothing
      in this First Supplemental Indenture or in the Notes, express or implied, shall
      give to any Person, other than the parties hereto and their respective
      successors hereunder and the Holders of Notes, any benefit or any legal or
      equitable right, remedy or claim under this First Supplemental
      Indenture.

     

            Section
      8.07.
      Concerning The Trustee. The
      Trustee accepts the Base Indenture, as supplemented by this First Supplemental
      Indenture, and agrees to perform the same upon the terms and conditions set
      forth therein as so supplemented.

     

            Section
      8.08.
      Governing Law. This
      First Supplemental Indenture and the Notes shall be governed by and construed
      in
      accordance with the laws of the State of New York.

     

            Section
      8.09.
      Execution In Counterparts. This
      First Supplemental 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.

     

            Section
      8.10.
      Effectiveness. This
      First Supplemental Indenture shall become effective upon the effectiveness
      of
      the Merger.

     

     

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

            IN
      WITNESS WHEREOF,
      the parties hereto have caused this First Supplemental Indenture to be duly
      executed as of the day and year first above written.

     

    
      	 	 	 
	 	COMMONWEALTH
              TELEPHONE ENTERPRISES, INC.
	 
 	 
 	 
 
	 	By:  	/s/ Raymond
              B. Ostroski
	 	
              
Name:  Raymond
              B.
              Ostroski
	 	Title:    Senior
              Vice President/General Counsel

    

     

    
      
        	 	 	 
	 	CITIZENS
                COMMUNICATIONS COMPANY
	 
 	 
 	 
 
	 	By:  	/s/ Donald
                B. Armour
	 	
                
Name:  Donald
                B.
                Armour
	 	Title:    Senior
                Vice President, Finance and Treasurer

      

       

    

    
      
        
          	 	 	 
	 	
                  THE
                    BANK OF NEW YORK,

                      as
                    Trustee

                
	 
 	 
 	 
 
	 	By:  	/s/ Mary
                  Lagumina
	 	
                  
Name:  Mary
                  Lagumina
	 	Title:    Vice
                  President

        

         

      

    

    

    

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

    EXHIBIT
      A

     

    [FORM
      OF
      GLOBAL NOTE]

     

    UNLESS
      THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
      TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (THE “DEPOSITARY”,
      WHICH
      TERM INCLUDES ANY SUCCESSOR DEPOSITARY FOR THE CERTIFICATES) TO THE COMPANY
      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 THE DEPOSITARY (AND ANY PAYMENT
      HEREIN IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
      AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), 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.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

    

    COMMONWEALTH
      TELEPHONE ENTERPRISES, INC.

     

    2005
      Series A 31⁄4% Convertible Note due 2023

     

                                                                                    
CUSIP:
      203349AC9

     

    No. 2                                                                                                              
Up
      to
      $[                    ]

     

            Commonwealth
      Telephone Enterprises, Inc., a corporation duly organized and validly
      existing under the laws of the State of Pennsylvania (herein called the
“Company”,
      which
      term includes any successor corporation under the Indenture referred to on
      the
      reverse hereof), for value received hereby promises to pay to CEDE &
CO. or its registered assigns, the principal sum as set forth on Schedule I
      hereto on July 15, 2023, at the office or agency of the Company maintained
      for that purpose in accordance with the terms of the Indenture, in such coin
      or
      currency of the United States of America as at the time of payment shall be
      legal tender for the payment of public and private debts, and to pay interest,
      semiannually on January 15 and July 15 of each year, commencing
      January 15, 2006, on said principal sum at said office or agency, in like
      coin or currency, at the rate per annum of 3.25%, from the January 15 or
      July 15, as the case may be, next preceding the date of this Note to which
      interest has been paid or duly provided for, unless the date hereof is a date
      to
      which interest has been paid or duly provided for, in which case from the date
      of this Note, or unless no interest has been paid or duly provided for on the
      Notes, in which case from August 3, 2005, until payment of said principal
      sum has been made or duly provided for. Notwithstanding the foregoing, if the
      date hereof is after any January 1 or July 1, as the case may be, and
      before the following January 15 or July 15, this Note shall bear
      interest from such January 15 or July 15;
      provided
      that if
      the Company shall default in the payment of interest due on such January 15
      or July 15, then this Note shall bear interest from the next preceding
      January 15 or July 15 to which interest has been paid or duly provided
      for or, if no interest has been paid or duly provided for on such Note, from
      August 3, 2005. Contingent interest, if any, will accrue for any six month
      interest period and be payable to holders of this Note on the applicable
      interest payment date to the person in whose name this Note is registered on
      the
      corresponding record date. Except as otherwise provided in the Indenture, the
      interest payable on the Note pursuant to the Indenture on any January 15 or
      July 15 will be paid to the Person entitled thereto as it appears in the
      Note Register at the close of business on the record date, which shall be the
      January 1 or July 1 (whether or not a Business Day) next preceding
      such January 15 or July 15, as provided in the Indenture;
      provided
      that any
      such interest not punctually paid or duly provided for shall be payable as
      provided in the Indenture. The Company shall pay interest (i) on any Notes
      in certificated form by check mailed to the address of the Person entitled
      thereto as it appears in the Note Register (provided
      that the
      holder of Notes with an aggregate principal amount in excess of $2,000,000
      shall, at the written election of such holder, be paid by wire transfer of
      immediately available funds) or (ii) on any Global Note by wire transfer of
      immediately available funds to the account of the Depositary or its
      nominee.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

            The
      Company promises
      to pay interest on overdue principal and (to the extent that payment of such
      interest is enforceable under applicable law) interest at the rate of 1% per
      annum.

     

            Reference
      is made to
      the further provisions of this Note set forth on the reverse hereof, including,
      without limitation, provisions giving the holder of this Note the right to
      convert this Note on the terms and subject to the limitations referred to on
      the
      reverse hereof and as more fully specified in the Indenture. Such further
      provisions shall for all purposes have the same effect as though fully set
      forth
      at this place.

     

            This
      Note shall be
      deemed to be a contract made under the laws of the State of New York, and for
      all purposes shall be construed in accordance with and governed by the laws
      of
      the State of New York, without regard to conflicts of laws principles
      thereof.

     

            This
      Note shall not
      be valid or become obligatory for any purpose until the certificate of
      authentication hereon shall have been manually signed by the Trustee or a duly
      authorized authenticating agent under the Indenture.

     

     

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

     

            IN
      WITNESS WHEREOF,
      the Company has caused this Note to be duly executed.

     

                 

      	
              COMMONWEALTH
                TELEPHONE ENTERPRISES, INC.

               

            
	
              By:

            	 
	 	
              Name:

            
	 	
              TTitle:

            

    

    

    

    
      	
              Attest:

               

            
	
              By:

            	 
	 	
              Name:

            
	 	
              TTitle:

            

    

    

    TRUSTEE’S
      CERTIFICATE OF AUTHENTICATION

     

    This
      is
      one of the Notes described in the within-named Indenture.

     

    
      	
              THE
                BANK OF NEW YORK, as Trustee

               

            
	
              By:

            	 
	 	
              Authorized
                Signatory

            

    

    

    

    
      	
                               ,
                or

               

            
	
              By:

            	 
	 	
              As
                Authenticating Agent

              (if
                different from Trustee)

            

    

    

    

    
      	
              By:

            	 
	 	
              Authorized
                Signatory

            

    

    

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

    

    FORM
      OF
      REVERSE OF NOTE

     

    COMMONWEALTH
      TELEPHONE ENTERPRISES, INC.

     

    2005
      Series A 31⁄4% Convertible Note due 2023

     

            This
      Note is one of a
      duly authorized issue of Notes of the Company, designated as its 2005 Series
      A
      31⁄4% Convertible Notes due 2023 (herein called the “Notes”),
      limited in aggregate principal amount to $63,892,000, issued and to be issued
      under and pursuant to an Indenture dated as of August 3, 2005, between the
      Company and The Bank of New York, as trustee (herein called the “Trustee”)
      (the
“Base
      Indenture”),
      as
      amended by the First Supplemental Indenture dated as of March 8, 2007 among
      the
      Company, Citizens Communications Company, a Delaware corporation (“Citizens”)
      and
      the Trustee (the “First
      Supplemental Indenture”,
      and
      together with the Base Indenture, the “Indenture”),
      to
      which Indenture and all indentures supplemental thereto reference is hereby
      made
      for a description of the rights, limitations of rights, obligations, duties
      and
      immunities thereunder of the Trustee, the Company, Citizens and the holders
      of
      the Notes.

     

            In
      case an Event of
      Default shall have occurred and be continuing, the principal of and accrued
      and
      unpaid Interest on all Notes may be declared by either the Trustee or the
      holders of not less than 25% in aggregate principal amount of the Notes then
      outstanding, and upon said declaration shall become, due and payable, in the
      manner, with the effect and subject to the conditions provided in the
      Indenture.

     

            The
      Indenture
      contains provisions permitting the Company and the Trustee, with the consent
      of
      the holders of at least a majority in aggregate principal amount of the Notes
      at
      the time outstanding, to execute supplemental indentures adding any provisions
      to or changing in any manner or eliminating any of the provisions of the
      Indenture or of any supplemental indenture or modifying in any manner the rights
      of the holders of the Notes;
      provided
      that no
      such supplemental indenture shall (i) extend the fixed maturity of any
      Note, or reduce the rate or extend the time of payment of Interest thereon,
      or
      reduce the principal amount thereof or reduce any amount payable upon redemption
      or repurchase thereof, or change the obligation of the Company to repurchase
      any
      Note at the option of a Noteholder on a Repurchase Date in a manner adverse
      to
      the holders of Notes, or change the obligation of the Company to repurchase
      any
      Note upon the happening of a Designated Event in a manner adverse to the holders
      of Notes, or impair the right of any Noteholder to institute suit for the
      payment thereof, or make the principal thereof or interest thereon payable
      in
      any coin or currency other than that provided in the Notes, or impair the right
      to convert the Notes in accordance with the terms set forth in the Indenture,
      including Section 15.03 and 15.07 thereof, in each case, without the
      consent of the holder of each Note so affected, or modify any of the provisions
      of Section 11.02 or Section 7.07 thereof, except to increase any such percentage
      or to provide that certain other provisions of the Indenture cannot be modified
      or waived without the consent of the holder of each Note so affected, or change
      any obligation of the Company to maintain an office or agency in the places
      and
      for the purposes set forth in Section 5.02 thereof,
      or reduce the quorum or voting requirements set forth in Article 10 or
      (ii) reduce the aforesaid percentage of Notes, the holders of which are
      required to consent to any such supplemental indenture, without the consent
      of
      the holders of all Notes then outstanding. Subject to the provisions of the
      Indenture, the holders of a majority in aggregate principal amount of the Notes
      at the time outstanding may on behalf of the holders of all of the Notes waive
      any past Default or Event of Default under the Indenture and its consequences
      except (A) a default in the payment of Interest on, or the principal of,
      any of the Notes, (B) a failure by the Company to convert any Notes in
      accordance with the terms set forth in the Indenture, (C) a default in the
      payment of the redemption price pursuant to Article 3 of the Indenture,
      (D) a default in the payment of the repurchase price pursuant to
      Article 3 of the Indenture, or (E) a default in respect of a covenant
      or provisions of the Indenture which under Article 11 of the Indenture cannot
      be
      modified or amended without the consent of the holders of each or all Notes
      then
      outstanding or affected thereby. Any such consent or waiver by the holder of
      this Note (unless revoked as provided in the Indenture) shall be conclusive
      and
      binding upon such holder and upon all future holders and owners of this Note
      and
      any Notes which may be issued in exchange or substitution hereof, irrespective
      of whether or not any notation thereof is made upon this Note or such other
      Notes.

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

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

     

            Interest
      on the Notes
      shall be computed on the basis of a 360-day year of twelve 30-day
      months.

     

            The
      Notes are
      issuable in fully registered form, without coupons, in denominations of $1,000
      principal amount and any multiple of $1,000. At the office or agency of the
      Company referred to on the face hereof, and in the manner and subject to the
      limitations provided in the Indenture, without payment of any service charge
      but
      with payment of a sum sufficient to cover any tax, assessment or other
      governmental charge that may be imposed in connection with any registration
      or
      exchange of Notes, Notes may be exchanged for a like aggregate principal amount
      of Notes of any other authorized denominations.

     

            At
      any time on or
      after July 18, 2008 and prior to maturity, the Notes may be redeemed at the
      option of the Company, in whole or in part, upon mailing a notice of such
      redemption not less than 30 days but not more than 60 days before the
      redemption date to the holders of Notes at their last registered addresses,
      all
      as provided in the Indenture, at a cash redemption price equal to 100% of the
      principal amount of the Notes being redeemed and accrued and unpaid Interest,
      to, but excluding, the redemption date;
      provided
      that if
      the redemption date falls after a record date and on or prior the corresponding
      interest payment date, then accrued and unpaid Interest to, but excluding,
      the
      redemption date shall be paid on such interest payment date to the holders
      of
      record of such Notes on the applicable record date instead of to the holders
      surrendering such Notes for redemption on such date.

     

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

            The
      Company may not
      give notice of any redemption of the Notes if a default in the payment of
      Interest on the Notes has occurred and is continuing.

     

            The
      Notes are not
      subject to redemption through the operation of any sinking fund.

     

            If
      a Designated Event
      occurs at any time prior to maturity of the Notes, the Company shall become
      obligated to purchase, at the option of the holder, all or any portion of the
      Notes held by such holder, on a date specified by the Company that is thirty
      (30) days after notice thereof at a cash repurchase price of 100% of the
      principal amount, plus any accrued and unpaid Interest, on such Note up to,
      but
      excluding, the Designated Event Repurchase Date;
      provided
      that if
      the repurchase date falls after a record date and on or prior the corresponding
      interest payment date, then accrued and unpaid Interest to, but excluding,
      the
      Designated Event Repurchase Date shall be paid on such interest payment date
      to
      the holders of record of such Notes on the applicable record date instead of
      to
      the holders surrendering such Notes for repurchase on such date. The Notes
      will
      be subject to repurchase in multiples of $1,000 principal amount. The Company
      shall mail to all holders of record of the Notes a notice of the occurrence
      of a
      Designated Event and of the repurchase right arising as a result thereof on
      or
      before the 15th day
      after the occurrence of such Designated Event. To exercise such right, a holder
      shall deliver to the Company such Note with the form entitled “Designated
      Event Repurchase
      Notice”
on
      the
      reverse thereof duly completed, together with the Note, duly endorsed for
      transfer, at any time prior to the close of business on the Designated Event
      Repurchase Date, and shall deliver the Notes to the Trustee (or other paying
      agent appointed by the Company) as set forth in the Indenture.

     

            Subject
      to the terms
      and conditions of the Indenture, the Company shall become obligated to purchase,
      at the option of the holder, all or any portion of the Notes held by such holder
      on July 15, 2008, 2013 and 2018 in whole multiples of $1,000 at a cash
      repurchase price of 100% of the principal amount, plus any accrued and unpaid
      Interest, on such Note up to the Repurchase Date. To exercise such right, a
      holder shall deliver to the Company such Note with the form entitled
“Repurchase
      Notice”
on
      the
      reverse thereof duly completed, together with the Note, duly endorsed for
      transfer, at any time from the opening of business on the date that is 20
      Business Days prior to such Repurchase Date until the close of business on
      the
      date that is two Business Days prior to the Repurchase Date, and shall deliver
      the Notes to the Trustee (or other paying agent appointed by the Company) as
      set
      forth in the Indenture.

     

            Holders
      have the
      right to withdraw any Designated Event Repurchase Notice or the Repurchase
      Notice, as the case may be, by delivering to the Trustee (or other paying agent
      appointed by the Company) a written notice of withdrawal up to the close of
      business on the Designated Event Repurchase Date or the Repurchase Date, as
      the
      case may be, all as provided in the Indenture.

     

            If
      money or cash,
      sufficient to pay the repurchase price of all Notes or portions thereof to
      be
      purchased as of the Designated Event Repurchase Date or the Repurchase Date,
      as
      the case may be, is deposited with the Trustee (or other paying agent appointed
      by the Company), on the Designated Event Repurchase Date or the Repurchase
      Date,
      as the case may be, interest will cease to accrue on such Notes (or portions
      thereof) immediately after such Repurchase Date, and the holder thereof shall
      have no other rights as such other than the right to receive the repurchase
      price upon surrender of such Note.

     

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

            Subject
      to the
      occurrence of certain events and in compliance with the provisions of the
      Indenture, prior to the final maturity date of the Notes, the holder hereof
      has
      the right, at its option, to convert each $1,000 principal amount of the Notes
      into $804.84 in cash, without interest, and Common Stock based on a conversion
      rate (the “Conversion
      Rate”)
      of
      25.7055 (a conversion price of approximately $38.90) multiplied by 0.768,
      subject to the Company’s right to deliver, in lieu of Common Stock, cash or a
      combination of cash and Common Stock as such shares shall be constituted at
      the
      date of conversion and subject to adjustment from time to time as provided
      in
      the Indenture, upon surrender of this Note with the form entitled “Conversion
      Notice”
on
      the
      reverse thereof duly completed, to the Company at the office or agency of the
      Company maintained for that purpose in accordance with the terms of the
      Indenture, or at the option of such holder, the Corporate Trust Office, and,
      unless the shares, if any, and cash issuable on conversion are to be issued
      in
      the same name as this Note, duly endorsed by, or accompanied by instruments
      of
      transfer in form satisfactory to the Company duly executed by, the holder or
      by
      his duly authorized attorney. The Company will notify the holder thereof of
      any
      event triggering the right to convert the Notes as specified above in accordance
      with the Indenture.

     

            No
      adjustment in
      respect of interest on any Note converted or dividends on any shares issued
      upon
      conversion of such Note will be made upon any conversion except as set forth
      in
      the next sentence. If this Note (or portion hereof) is surrendered for
      conversion during the period from the close of business on any record date
      for
      the payment of interest to the close of business on the Business Day preceding
      the following interest payment date, this Note (or portion hereof being
      converted) must be accompanied by payment, in immediately available funds or
      other funds acceptable to the Company, of an amount equal to the interest
      otherwise payable on such interest payment date on the principal amount being
      converted;
      provided
      that no
      such payment shall be required (1) if the Company has specified a redemption
      date that is after a record date and prior to the next interest payment date,
      (2) if the Company has specified a Designated Event Repurchase Date that is
      during such period or (3) to the extent of any overdue Interest, if any overdue
      interest exists at the time of conversion with respect to such
      Note.

     

            No
      fractional shares
      will be issued upon any conversion, but an adjustment and payment in cash will
      be made, as provided in the Indenture, in respect of any fraction of a share
      which would otherwise be issuable upon the surrender of any Note or Notes for
      conversion.

     

            A
      Note in respect of
      which a holder is exercising its right to require repurchase upon a Designated
      Event or repurchase on a Repurchase Date may be converted only if such holder
      withdraws its election to exercise either such right in accordance with the
      terms of the Indenture.

     

    
      
        
        

      

      
        28

        
          

        

      

      
        
        

      

    

     

     

            Any
      Notes called for
      redemption, unless surrendered for conversion by the holders thereof on or
      before the close of business on the Business Day preceding the redemption date,
      may be deemed to be redeemed from the holders of such Notes for an amount equal
      to the applicable redemption price, together with accrued but unpaid interest
      to, but excluding, the date fixed for redemption, by one or more investment
      banks or other purchasers who may agree with the Company (i) to purchase such
      Notes from the holders thereof and convert them in accordance with the terms
      of
      the Indenture and (ii) to make payment for such Notes as aforesaid to the
      Trustee in trust for the holders.

     

            Upon
      due presentment
      for registration of transfer of this Note at the office or agency of the Company
      maintained for that purpose in accordance with the terms of the Indenture,
      a new
      Note or Notes of authorized denominations for an equal aggregate principal
      amount will be issued to the transferee in exchange thereof, subject to the
      limitations provided in the Indenture, without charge except for any tax,
      assessment or other governmental charge imposed in connection
      therewith.

     

            The
      Company, the
      Trustee, any authenticating agent, any paying agent, any conversion agent and
      any Note Registrar may deem and treat the registered holder hereof as the
      absolute owner of this Note (whether or not this Note shall be overdue and
      notwithstanding any notation of ownership or other writing hereon made by anyone
      other than the Company or any Note Registrar) for the purpose of receiving
      payment hereof, or on account hereof, for the conversion hereof and for all
      other purposes, and neither the Company nor the Trustee nor any other
      authenticating agent nor any paying agent nor other conversion agent nor any
      Note Registrar shall be affected by any notice to the contrary. All payments
      made to or upon the order of such registered holder shall, to the extent of
      the
      sum or sums paid, satisfy and discharge liability for monies payable on this
      Note.

     

            No
      recourse for the
      payment of the principal of or Interest on this Note, or for any claim based
      hereon or otherwise in respect hereof, and no recourse under or upon any
      obligation, covenant or agreement of the Company in the Indenture or any
      supplemental indenture or in any Note, or because of the creation of any
      indebtedness represented thereby, shall be had against any incorporator,
      stockholder, employee, agent, officer or director or subsidiary, as such, past,
      present or future, of the Company or of any successor corporation, either
      directly or through the Company or any successor corporation, whether by virtue
      of any constitution, statute or rule of law or by the enforcement of any
      assessment or penalty or otherwise, all such liability being, by acceptance
      hereof and as part of the consideration for the issue hereof, expressly waived
      and released.

     

            For
      purposes of
      sections 1272, 1273 and 1275 of the Internal Revenue Code of 1986, as amended,
      this Note is being issued with Tax Original Issue Discount and the issue date
      of
      this Note is August 3, 2005. In addition, this Note is subject to the
      United States federal income tax regulations governing contingent payment debt
      instruments. For purposes of sections 1272, 1273 and 1275 of the Internal
      Revenue Code, the comparable yield of this Note is 8.00% per year, compounded
      semi-annually (which will be treated as the yield to maturity for United States
      federal income tax purposes).

     

    
      
        
        

      

      
        29

        
          

        

      

      
        
        

      

    

     

     

            The
      Company agrees,
      and by acceptance of a beneficial interest in a Note each holder and any
      beneficial owner of a Note shall be deemed to have agreed to treat the Note
      as
      indebtedness of the Company for United States federal income tax purposes that
      is subject to Treasury Regulation Section 1.1275-4 or any successor provision
      (the “contingent payment regulations”) and to be bound (in the absence of an
      administrative determination or judicial ruling to the contrary) by the
      Company’s determination of the comparable yield and the projected payment
      schedule within the meaning of the contingent payment regulations. A holder
      of
      Notes may obtain the issue price amount of Tax Original Issue Discount, issue
      date, yield to maturity, comparable yield and projected payment schedule for
      the
      Notes, determined by the Company pursuant to the contingent payment regulations,
      by submitting a written request for it to the Company at the following address:
      Commonwealth Telephone Enterprises, Inc., 100 CTE Drive, Dallas,
      Pennsylvania 18612-9774, Attention: Vice President, Investor
      Relations.

     

            This
      Note shall be
      deemed to be a contract made under the laws of New York, and for all purposes
      shall be construed in accordance with the laws of New York, without regard
      to
      conflicts of laws principles thereof.

     

            Terms
      used in this
      Note and defined in the Indenture are used herein as therein
      defined.

     

    

    
      
        
        

      

      
        30

        
          

        

      

      
        
        

      

    

    ABBREVIATIONS

     

            The
      following
      abbreviations, when used in the inscription of the face of this Note, shall
      be
      construed as though they were written out in full according to applicable laws
      or regulations.

     

    
      	
              TEN
                COM -

            	
              as
                tenants in common

            	 	
              UNIF
                GIFT MIN ACT -___ Custodian ___

            
	
              TEN
                ENT -

            	
              as
                tenant by the entireties

            	 	
              (Cust) (Minor)

            
	
              JT
                TEN -

            	
              as
                joint tenants with right of survivorship and not as tenants in
                common

            	 	
              under
                Uniform Gifts to Minors Act

              ____________________________

              (State)

            

    

     

            Additional
      abbreviations may also be used though not in the above list.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    GUARANTEE

     

    The
      Guarantor listed below (hereinafter referred to as the “Guarantor,”
which
      term includes any successors or assigns under the Indenture dated as of
      August 3, 2005, between Commonwealth Telephone Enterprises, Inc. (the
“Company”)
      and
      The Bank of New York, as trustee (herein called the “Trustee”)
      (the
“Base
      Indenture”),
      as
      amended by the First Supplemental Indenture dated as of March 8, 2007 among
      the
      Company, Citizens Communications Company, a Delaware corporation (“Citizens”)
      and
      the Trustee (the “First
      Supplemental Indenture”,
      and
      together with the Base Indenture, the “Indenture”),
      has
      irrevocably and unconditionally guaranteed on a senior basis the Guarantee
      Obligations (as defined in Section 6.01 of the First Supplemental Indenture),
      which include (i) the due and punctual payment of the principal of and interest
      on the 2005 Series A 31⁄4% Convertible Notes due 2023 (the “Notes”)
      of the
      Company, whether at maturity, by acceleration, call for redemption, upon a
      repurchase or otherwise, the due and punctual payment of interest on the overdue
      principal and (to the extent permitted by law) interest on any interest on
      the
      Notes, and the due and punctual performance of all other obligations of the
      Company, to the Holders of the Notes or the Trustee all in accordance with
      the
      terms set forth in Article
      6
      of the
      First Supplemental Indenture, and (ii) in case of any extension of time of
      payment or renewal of any Notes or any such other obligations, that the same
      shall be promptly paid in full when due or performed in accordance with the
      terms of the extension or renewal, whether at maturity, by acceleration, call
      for redemption, upon a repurchase or otherwise.

     

    The
      obligations of the Guarantor to the Holders of the Notes and to the Trustee
      pursuant to this Guarantee and the Indenture are expressly set forth in
Article
      6
      of the
      First Supplemental Indenture and reference is hereby made to such First
      Supplemental Indenture for the precise terms of this Guarantee.

     

    The
      Guarantor hereby waives diligence, presentment, demand of payment, filing of
      claims with a court in the event of merger or bankruptcy of the Company, any
      right to require a proceeding first against the Company, the benefit of
      discussion, protest or notice with respect to the Notes and all demands
      whatsoever.

     

    This
      is a
      continuing Guarantee and shall remain in full force and effect and shall be
      binding upon the Guarantor and its successors and assigns until full and final
      payment of all of the Company’s obligations under the Notes and Indenture or
      until legally discharged in accordance with the Indenture and shall inure to
      the
      benefit of the successors and assigns of the Trustee and the Holders of the
      Notes, and, in the event of any transfer or assignment of rights by any Holder
      of the Notes or the Trustee, the rights and privileges herein conferred upon
      that party shall automatically extend to and be vested in such transferee or
      assignee, all subject to the terms and conditions hereof. This is a Guarantee
      of
      payment and performance and not of collectibility.

     

    This
      Guarantee shall not be valid or obligatory for any purpose until the certificate
      of authentication on the Note upon which this Guarantee is noted shall have
      been
      executed by the Trustee under the Indenture by the manual or facsimile signature
      of one of its authorized officers.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    The
      obligations of the Guarantor under this Guarantee shall be limited to the extent
      necessary to insure that it does not constitute a fraudulent conveyance under
      applicable law.

     

    THE
      TERMS
      OF ARTICLE 6 OF THE FIRST SUPPLEMENTAL INDENTURE ARE INCORPORATED HEREIN BY
      REFERENCE.

     

    Capitalized
      terms used herein have the same meanings given in the Indenture unless otherwise
      indicated.

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    IN
      WITNESS WHEREOF, the Guarantor has caused this instrument to be duly
      executed.

     

    Dated:

     

    
      	
              CITIZENS
                COMMUNICATIONS COMPANY

               

            
	
              By:

            	 
	 	Name: 
	 	Title:

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    CONVERSION
      NOTICE

     

    
      	
              TO:

            	
              COMMONWEALTH
                TELEPHONE ENTERPRISES, INC.

              THE
                BANK OF NEW YORK

            

    

     

            The
      undersigned
      registered owner of this Note hereby irrevocably exercises the option to convert
      this Note, or the portion thereof (which is $1,000 or a multiple thereof) below
      designated, in accordance with the terms of the Indenture referred to in this
      Note, subject to the Company’s payment elections, and directs that any shares
      issuable and deliverable upon such conversion, together with any check in
      payment of any cash and any Notes representing any unconverted principal amount
      hereof, be issued and delivered to the registered holder hereof unless a
      different name has been indicated below. Capitalized terms used herein but
      not
      defined shall have the meanings ascribed to such terms in the Indenture. If
      shares, any portion of this Note not converted or a check for cash payable
      are
      to be issued in the name of a person other than the undersigned, the undersigned
      will provide the appropriate information below and pay all transfer taxes
      payable with respect thereto. Any amount required to be paid by the undersigned
      on account of interest, including contingent interest, if any, accompanies
      this
      Note.

     

    Dated:
      ______________________

     

    
      	
              __________________________________

            
	
              __________________________________

              Signature(s)

            
	
              Signature(s)
                must be guaranteed by an “eligible
                guarantor institution”
                meeting the requirements of the Note Registrar, which requirements
                include
                membership or participation in the Security Transfer Agent Medallion
                Program (“STAMP”)
                or such other “signature
                guarantee program”
                as may be determined by the Note Registrar in addition to, or in
                substitution for, STAMP, all in accordance with the Securities Exchange
                Act of 1934, as amended.

            
	
              __________________________________

              Signature
                Guarantee

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

            Fill
      in the
      registration of shares of Common Stock if to be issued, and Notes if to be
      delivered, other than to and in the name of the registered holder:

     

    
      	 
	 
	
              (Name)

            

    

    

    
      	 
	 
	
              (Street
                Address)

            

    

    

    
      	 
	 
	
              (City,
                State and Zip Code)

            

    

    

    
      	 
	 
	
              Please
                print name and address

            

    

     

    
      	
              Principal
                amount to be converted

              (if
                less than all): 

            
	 	 
	
              $

            	 

    

     

    
      	
              Social
                Security or Other Taxpayer

              Identification
                Number:

               

            
	 

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    DESIGNATED
      EVENT REPURCHASE NOTICE

     

    
      	
              TO:

            	
              COMMONWEALTH
                TELEPHONE ENTERPRISES, INC.

              THE
                BANK OF NEW YORK

            

    

     

     

            The
      undersigned
      registered owner of this Note hereby irrevocably acknowledges receipt of a
      notice from Commonwealth Telephone Enterprises, Inc. (the “Company”)
      regarding the right of holders to elect to require the Company to repurchase
      the
      Notes upon the occurrence of a Designated Event with respect to the Company
      and
      requests and instructs the Company to repay the entire principal amount of
      this
      Note, or the portion thereof (which is $1,000 or an integral multiple thereof)
      below designated, in accordance with the terms of the Indenture at the price
      of
      100% of such entire principal amount or portion thereof, together with accrued
      Interest to, but excluding, the Designated Event Repurchase Date, to the
      registered holder hereof. Capitalized terms used herein but not defined shall
      have the meanings ascribed to such terms in the Indenture. The Notes shall
      be
      repurchased by the Company as of the portion thereof, together with accrued
      interest to, but excluding, the Designated Event Repurchase Date pursuant to
      the
      terms and conditions specified in the Indenture.

     

    $        
      principal amount of the Notes to which this Designated Event Repurchase Notice
      relates (if less than entire principal amount)

     

            Dated:

     

            Signature(s):

     

            NOTICE:
      The above
      signatures of the holder(s) hereof must correspond with the name as written
      upon
      the face of the Note in every particular without alteration or enlargement
      or
      any change whatever.

     

            Note
      Certificate
      Number (if applicable):

     

            Principal
      amount to
      be repurchased (if less than all):

     

            Social
      Security or
      Other Taxpayer Identification Number:

     

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    REPURCHASE
      NOTICE

     

    
      	
              TO:

            	
              COMMONWEALTH
                TELEPHONE ENTERPRISES, INC.

              THE
                BANK OF NEW YORK

            

    

     

     

     

            The
      undersigned
      registered owner of this Note hereby irrevocably acknowledges receipt of a
      notice from Commonwealth Telephone Enterprises, Inc. (the “Company”)
      regarding the right of holders to elect to require the Company to repurchase
      the
      Notes and requests and instructs the Company to repay the entire principal
      amount of this Note, or the portion thereof (which is $1,000 or an integral
      multiple thereof) below designated, in accordance with the terms of the
      Indenture at the price of 100% of such entire principal amount or portion
      thereof, together with accrued Interest to, but excluding, the Repurchase Date,
      to the registered holder hereof. Capitalized terms used herein but not defined
      shall have the meanings ascribed to such terms in the Indenture. The Notes
      shall
      be repurchased by the Company as of the Repurchase Date pursuant to the terms
      and conditions specified in the Indenture.

     

    $        
      principal amount of the Notes to which this Repurchase Notice relates (if less
      than entire principal amount)

     

            Dated:

     

            Signature(s):

     

            NOTICE:
      The above
      signatures of the holder(s) hereof must correspond with the name as written
      upon
      the face of the Note in every particular without alteration or enlargement
      or
      any change whatever.

     

            Note
      Certificate
      Number (if applicable):

     

            Principal
      amount to
      be repurchased (if less than all):

     

            Social
      Security or
      Other Taxpayer Identification Number:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    ASSIGNMENT

     

            For
      value received
      ______________________________hereby sell(s) assign(s) and transfer(s) unto
      ___________________________________ (Please insert social security or other
      Taxpayer Identification Number of assignee) the within Note, and hereby
      irrevocably constitutes and appoints ______________________________________
      attorney to transfer said Note on the books of the Company, with full power
      of
      substitution in the premises.

     

    

    Dated:
      ______________________

     

    
       

      
        	
                __________________________________

              
	
                __________________________________

                Signature(s)

              
	
                
                  Signature(s)
                    must be guaranteed by an “eligible
                    guarantor institution”
                    meeting the requirements of the Note Registrar, which requirements
                    include
                    membership or participation in the Security Transfer Agent Medallion
                    Program (“STAMP”)
                    or such other “signature
                    guarantee program”
                    as may be determined by the Note Registrar in addition to, or
                    in
                    substitution for, STAMP, al in accordance with the Securities
                    Exchange Act
                    of 1934, as amended.

                

              
	
                __________________________________

                Signature
                  Guarantee

              

      

      
 

    

    NOTICE:
      The signature on the Conversion Notice, the Designated Event Repurchase Notice,
      the Repurchase Notice or the Assignment must correspond with the name as written
      upon the face of the Note in every particular without alteration or enlargement
      or any change whatever.

    

    

    

    
      
        
          

        

        
        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    COMMONWEALTH

    TELEPHONE
      ENTERPRISES, INC.

    2005
      Series A 31⁄4% Convertible Note due 2023

     

    No.
      2

     

    The
      original principal amount of this Note is
      $[                                ]
      DOLLARS
      ($[                          ]).
      The principal amount has been adjusted in accordance with the terms of the
      Indenture as set forth below:

     

    

    
      	
              Date

            	
              Principal
                Amount

            	
              Notation
                Explaining Principal Amount Recorded

            	
              Authorized
                Signature of Trustee or Custodian

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