Document:

EXHIBIT 4.7

 

Form 51-102F3

Material
Change Report

 

	
  Item
  1:

  	
   

  	
  Name
  and Address of Company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GLG Life Tech
  Corporation (“GLG” or the “Company”) 

  536 World Trade Centre 

  999 Canada Place 

  Vancouver, B.C. V6C 3E2

  
	
   

  	
   

  	
   

  
	
  Item
  2:

  	
   

  	
  Date
  of Material Change

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  December 18, 2008

  
	
   

  	
   

  	
   

  
	
  Item
  3:

  	
   

  	
  News
  Release

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The news releases were issued at
  Vancouver, British Columbia on December 18, 2008 and disseminated via PR
  Newswire.

  
	
   

  	
   

  	
   

  
	
  Item
  4:

  	
   

  	
  Summary
  of Material Change

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Company
  announced that the Food and Drug Administration of the United States (“FDA”)
  confirmed on December 18, 2008 that it had no objection to the
  conclusion of an independent expert panel which reviewed research on Rebiana
  and concluded that it is generally recognized as safe for use as a general
  purpose sweetener, including for use in food and beverages.Rebiana is an all
  natural, zero calorie sweetener made with 97% Rebaudioside A from the leaves
  of the stevia plant. 

   

  The Company
  also announced that it has completed the necessary work required to declare
  self-affirmed GRAS status for its RebpureTM product which contains 97% pure
  Rebaudioside, a stevia extract.

  
	
   

  	
   

  	
   

  
	
  Item
  5:

  	
   

  	
  Full
  Description of Material Change

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.1          Full Description of Material Change

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Company
  announced that the FDA confirmed on December 18, 2008 that it had no
  objection to the conclusion of an independent expert panel which reviewed
  research of Rebiana and concluded that it is generally recognized as safe for
  use (GRAS) as a general purpose sweetener, including for use in food and
  beverages.Rebiana is an all natural, zero calorie sweetener made with 97%
  Rebaudioside A from the leaves of the stevia plant. 

   

  The
  Company’s strategic partner, Cargill, submitted an application to the FDA for
  GRAS approval of Rebiana in May of last year. Since then, Rebiana has
  been under review by the FDA who confirmed that they have no objection to
  Rebiana being GRAS which will allow the use of Rebiana as a food and beverage
  ingredient in the U.S.

  

 

 

	
   

  	
   

  	
  The
  Company has a 10-year renewable strategic alliance and supply agreement with
  Cargill to provide it with 80% of its global Rebaudioside A extract supply
  for the first five years of the agreement. The Company’s operations cover
  each step in the stevia supply chain including seed breeding, propagation,
  growth and harvest, extraction, refining and distribution of finished
  product.

   

  Cargill
  has already introduced TRUVIATM, a tabletop
  product made with Rebiana. A U.S. national marketing campaign has been
  launched for TRUVIATM, with interest in the market for the zero-calorie
  sweetener continuing to grow.

   

  The Company
  also announced that it has completed the necessary work required to declare
  self-affirmed GRAS status for its RebpureTM product which contains 97% pure
  Rebaudioside, a stevia extract. 

   

  The RebpureTM GRAS review, which began several months ago,
  included an extensive review of current research including toxicological data
  demonstrating the safety of the product.

   

  Key
  to GLG’s self-affirmation, the molecular structure of RebpureTM has been proven to match the molecular
  structure of Rebiana, which the FDA concluded had been sufficiently
  documented to receive GRAS approval. As an important step in the GRAS
  self-affirmation process, GLG worked closely with ChromaDex (CDXC — OTC), a
  leader in the development of phytochemical and botanical reference standards
  and the creation of associated intellectual property, to perform a
  characterization study on GLG’s high grade stevia extract RebpureTM. More
  specifically, the evaluation showed conclusively that the molecular
  structures of each product, RebpureTM and Rebiana, were a match. Following
  GLG’s self-affirmation of GRAS, a notification will be filed with the FDA.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  5.2          Disclosure for Restructuring
  Transactions

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not applicable.

  
	
   

  	
   

  	
   

  
	
  Item
  6:

  	
   

  	
  Reliance
  on subsection 7.1(2) of National Instrument 51-102

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Not
  applicable.

  
	
   

  	
   

  	
   

  
	
  Item
  7:

  	
   

  	
  Omitted
  Information

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  No
  significant facts remain confidential and no information has been omitted in
  this report.

  
	
   

  	
   

  	
   

  
	
  Item
  8:

  	
   

  	
  Executive
  Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name of Executive Officer:

  	
   

  	
  Brian Meadows, Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Telephone Number:

  	
   

  	
  (604)
  641-1368

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Item
  9:

  	
   

  	
  Date
  of Report

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  January 28, 2009

  

 

2

 

Forward-looking
statements: Certain statements in this material
change report constitute “forward-looking statements”.  Such forward-looking statements include,
without limitation, statements evaluating the market and general economic
conditions and discussing future-oriented costs, expenditures and other
financial or operating performances. Often, but not always, forward-looking
statements can be identified by the use of words such as “plans”, “expects” or “does
not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”,
“anticipates” or “does not anticipate”, or “believes” or variations of such
words and phrases or words and phrases that state or indicate that certain
actions, events or results “may”, “could”, “would”, “might” or “will” be taken,
occur or be achieved. While the Company has based these forward-looking
statements on its current expectations about future events, the statements are
not guarantees of the Company’s future performance and are subject to risks,
uncertainties, assumptions and other factors which could cause actual results
to differ materially from future results expressed or implied by such
forward-looking statements. Such factors include amongst others the effects of
general economic conditions, changing foreign exchange rates and actions by
government authorities, uncertainties associated with legal proceedings and
negotiations, industry supply levels, competitive pricing pressures and
misjudgments in the course of preparing forward-looking statements. Please
refer to the heading “Risk Factors” in our Annual Information Form in
respect of our year-ended December 31, 2007 and the risk factors in our
Management’s Discussion and Analysis (“MD&A”) for the year ended December 31,
2007 for a discussion of these and other factors underlying forward-looking
statement, both of which are available on SEDAR at www.sedar.com under the
Company’s names. In light of these factors, the forward-looking events
discussed in this press release might not occur. Further, although the Company
has attempted to identify factors that could cause actual actions, events or
results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or results
not to be as anticipated, estimated or intended. The Company undertakes no
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise. As there can be no
assurance that forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those anticipated in
such statements, readers should not place undue reliance on forward-looking
statements.

 

3Exhibit No. 4(b)

 

SERIES SUPPLEMENT

 

This SERIES SUPPLEMENT dated as of June 29, 2007
(this “Series Supplement”), by and between RSB BONDCO LLC, a
limited liability company formed under the laws of the State of Delaware (the “Issuer”),
and DEUTSCHE BANK TRUST COMPANY AMERICAS, a New York banking corporation (“Deutsche
Bank”), in its capacity as indenture trustee (the “Indenture Trustee”)
for the benefit of the Secured Parties under the Indenture dated as of June 29,
2007, by and between the Issuer and Deutsche Bank, in its capacity as Indenture
Trustee and in its separate capacity as a securities intermediary (the “Indenture”).

 

PRELIMINARY STATEMENT

 

Section 2.02 of the Indenture provides, among other things, that
the Issuer and the Indenture Trustee may at any time and from time to time
enter into one or more Series Supplements for the purposes of authorizing
the issuance by the Issuer of a Series of Rate Stabilization Bonds and
establishing the terms thereof.  The
Issuer has duly authorized the creation of a Series of Rate Stabilization
Bonds with an initial aggregate principal amount of $623,200,000 to be known as
RSB BondCo LLC Rate Stabilization Bonds, Series A (the “Series A
Rate Stabilization Bonds”), and the Issuer and the Indenture Trustee are
executing and delivering this Series Supplement in order to provide for
the creation of the Series A Rate Stabilization Bonds.

 

All terms used in this Series Supplement that are
defined in the Indenture, either directly or by reference therein, have the
meanings assigned to them therein, except to the extent such terms are defined
or modified in this Series Supplement or the context clearly requires
otherwise.  In the event that any term or
provision contained herein shall conflict with or be inconsistent with any term
or provision contained in the Indenture, the terms and provisions of this Series Supplement
shall govern.

 

GRANTING CLAUSE

 

With respect to the Series A Rate Stabilization
Bonds, the Issuer hereby Grants to the Indenture Trustee, as Indenture Trustee
for the benefit of the Secured Parties of the Series A Rate Stabilization
Bonds, all of the Issuer’s right, title and interest (whether now owned or
hereafter acquired or arising) in and to the following (collectively, the “Series A
Rate Stabilization Bond Collateral”): (a) the Rate Stabilization
Property created under and pursuant to the Applicable Qualified Rate Order, and
transferred by the Seller to the Issuer pursuant to the Sale Agreement
(including, to the fullest extent permitted by law, the right to impose,
collect and receive Qualified Rate Stabilization Charges, all revenues,
collections, claims, rights, payments, money or proceeds of or arising from the
Qualified Rate Stabilization Charges authorized in the Applicable Qualified
Rate Order and any Tariffs filed pursuant thereto and any contractual rights to
collect such Qualified Rate Stabilization Charges from Customers and
Third-Party Collectors), (b) all Qualified Rate Stabilization Charges
related to such Rate Stabilization Property, (c) the Sale Agreement and
each Bill of Sale executed in connection therewith and all property and
interests in property transferred under the Sale Agreement and such Bills of
Sale with respect to 

 

 

such Rate Stabilization Property and the Series A
Rate Stabilization Bonds, (d) the Servicing Agreement, the Administration
Agreement and any subservicing, agency, administration, collection or other
agreements executed in connection therewith, to the extent related to the
foregoing Rate Stabilization Property and the Series A Rate Stabilization
Bonds, (e) the Collection Account for such Series, all subaccounts thereof
and all amounts of cash, instruments, investment property or other assets on
deposit therein or credited thereto from time to time and all financial assets
and securities entitlements carried therein or credited thereto, (f) all
rights to compel the Servicer to file for and obtain adjustments to the
Qualified Rate Stabilization Charges in accordance with Section 7-531 of
the Rate Stabilization Law, the Applicable Qualified Rate Order or any Tariff
filed in connection therewith, (g) all deposits, guarantees, surety bonds,
letters of credit and other forms of credit support provided by or on behalf of
Third-Party Collectors pursuant to such Applicable Qualified Rate Order or
Tariff, including investment earnings thereon and all amounts on deposit in the
TPC Deposit Accounts, (h) all
present and future claims, demands, causes and choses in action in respect of
any or all of the foregoing, whether such claims, demands, causes and choses in
action constitute Rate Stabilization Property, accounts, general intangibles,
instruments, contract rights, chattel paper or proceeds of such items or any
other form of property, (i) all accounts, chattel paper, deposit accounts,
documents, general intangibles, goods, instruments, investment property,
letters of credit, letters-of-credit rights, money, commercial tort claims and
supporting obligations related to the foregoing, and (j) all payments on
or under, and all proceeds in respect of, any or all of the foregoing; it
being understood that the following do not constitute Series A Rate
Stabilization Bond Collateral: (i) following retirement of all Outstanding Series of
Rate Stabilization Bonds, cash that has been released pursuant to Section 8.04(c)
of the Indenture, (ii) amounts deposited with the Issuer on any Series Issuance
Date, including the Closing Date, for payment of costs of issuance with respect
to the related Series (together with any interest earnings thereon) and (iii) the
Initial Capital Contribution by the Member to the Issuer pursuant to Section 2.01
of the LLC Agreement, it being understood that such amounts described in clauses
(i), (ii) and (iii) above shall not be subject
to Section 3.17 of the Indenture.

 

The foregoing Grant is made in trust to secure the
payment of principal of and premium, if any, interest on, and any other amounts
owing in respect of, the Series A Rate Stabilization Bonds and all fees,
expenses, counsel fees and expenses and other amounts due and payable to the
Indenture Trustee (collectively, the “Secured Obligations”) equally and
ratably without prejudice, priority or distinction, except as expressly
provided in the Indenture, to secure compliance with the provisions of the
Indenture with respect to the Series A Rate Stabilization Bonds, all as
provided in the Indenture and to secure the performance by the Issuer of all of
its obligations under the Indenture.  The
Indenture and this Series Supplement constitutes a security agreement within
the meaning of the Rate Stabilization Law and under the UCC to the extent that
the provisions of the UCC are applicable hereto.  In addition, the Issuer shall cause the
filing of one or more financing statements to evidence the security interest of
the Indenture Trustee in the Series A Rate Stabilization Bond Collateral.

 

The Indenture Trustee, as indenture trustee on behalf
of the Secured Parties of the Series A Rate Stabilization Bonds,
acknowledges such Grant and accepts the trusts under this Series Supplement
and the Indenture in accordance with the provisions of this Series Supplement
and the Indenture.

 

2

 

SECTION 1. Designation.  The Series A Rate Stabilization Bonds
shall be designated generally as the Rate Stabilization Bonds, Series A
and further denominated as Tranches A-1 through A-3.

 

SECTION 2. Initial Principal Amount; Rate
Stabilization Bond Interest Rate; Scheduled Final Payment Date; Final Maturity
Date.  The Series A Rate
Stabilization Bonds of each Tranche shall have the initial principal amount,
bear interest at the rates per annum (as to each Tranche, the “Rate
Stabilization Bond Interest Rate”) and shall have the Scheduled Final
Payment Dates and the Final Maturity Dates set forth below:

 

	
  Tranche

  	
   

  	
  Initial Principal

  Amount

  	
   

  	
  Rate Stabilization

  Bond

  Interest Rate

  	
   

  	
  Scheduled Final

  Payment Date

  	
   

  	
  Final

  Maturity Date

  	
   

  
	
  Tranche A-1

  	
   

  	
  $

  	
  284,000,000

  	
   

  	
  5.47

  	
  %

  	
  10/1/2012

  	
   

  	
  10/1/2014

  	
   

  
	
  Tranche A-2

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  5.72

  	
  %

  	
  4/1/2016

  	
   

  	
  4/1/2018

  	
   

  
	
  Tranche A-3

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
  5.82

  	
  %

  	
  4/1/2017

  	
   

  	
  6/28/2019

  	
   

  

 

The
Rate Stabilization Bond Interest Rate shall be computed on the basis of a
360-day year of twelve (12) 30-day months.

 

SECTION 3. 
Authentication Date; Payment Dates; Expected
Amortization Schedule for Principal; Periodic Interest; No Premium; Other Terms.

 

(a)           Authentication Date.  The Series A Rate Stabilization Bonds
that are authenticated and delivered by the Indenture Trustee to or upon the
order of the Issuer on June 29, 2007 (the “Series Issuance Date”)
shall have as their date of authentication June 29, 2007.

 

(b)           Payment
Dates.  The Payment Dates for the Series A
Rate Stabilization Bonds are April 1 and October 1 of each year or,
if any such date is not a Business Day, the following Business Day, commencing
on April 1, 2008 and continuing until the earlier of repayment of the Series A,
Tranche A-3 Rate Stabilization Bonds in full and the Final Maturity Date for
the Series A, Tranche A-3 Rate Stabilization Bonds.

 

(c)           Expected Amortization Schedule for
Principal.  Unless an Event of
Default shall have occurred and be continuing on each Payment Date, the
Indenture Trustee shall distribute to the Holders of record as of the related
Record Date amounts payable pursuant to Section 8.02(e) of the
Indenture as principal, in the following order and priority: (1) to the
holders of the Tranche A-1 Rate Stabilization Bonds, until the Outstanding
Amount of such Tranche of Rate Stabilization Bonds thereof has been reduced to
zero; (2) to the holders of the Tranche A-2 Rate Stabilization Bonds,
until the Outstanding Amount of such Tranche of Rate Stabilization Bonds
thereof has been reduced to zero; and (3) to the holders of the Tranche
A-3 Rate Stabilization Bonds, until the Outstanding Amount of such Tranche of
Rate Stabilization Bonds thereof has been reduced to zero; provided, however,
that in no event shall a principal payment pursuant to this Section 3(c) on
any Tranche on a Payment Date be greater than the amount necessary to reduce
the Outstanding Amount of such Tranche of Rate Stabilization 

 

3

 

Bonds to the amount
specified in the Expected Amortization Schedule which is attached as Schedule
A hereto for such Tranche and Payment Date.

 

(d)                                 Periodic Interest. 
Periodic Interest will be payable on each Tranche of the Series A
Rate Stabilization Bonds on each Payment Date in an amount equal to one-half of
the product of (i) the applicable Rate Stabilization Bond Interest Rate
and (ii) the Outstanding Amount of the related Tranche of Series A Rate
Stabilization Bonds as of the close of business on the preceding Payment Date
(or, with respect to the Initial Payment Date, the Outstanding Amount of the
related Tranche of Series A Rate Stabilization Bonds on the Series Issuance
Date) after giving effect to all payments of principal made to the Holders of
the related Tranche of Series A Rate Stabilization Bonds on such preceding
Payment Date.

 

(e)                                  Book-Entry Rate Stabilization Bonds. 
The Series A Rate Stabilization Bonds shall be Book-Entry Rate
Stabilization Bonds and the applicable provisions of Section 2.11
of the Indenture shall apply to such Rate Stabilization Bonds.

 

(f)                                    Waterfall Caps.

 

(i)            The amount payable
with respect to the Series A Rate Stabilization Bonds pursuant to Section 8.02(e)(i)
of the Indenture shall not exceed $850,000 annually.

 

(ii)           The amount payable
with respect to the Series A Rate Stabilization Bonds pursuant to Section 8.02(e)(ii) of
the Indenture shall not exceed on an annual basis (A) for so long as BGE
is the Servicer, 0.05% of the aggregate initial principal amount of Series A
Rate Stabilization Bonds, provided that BGE may seek approval from the
PSC to recover from Customers, in accordance with the Financing Credit Order,
any incremental costs it incurs to service the Rate Stabilization Property to
the extent such incremental costs exceed 0.05% of the aggregate initial
principal amount of Series A Rate Stabilization Bonds, and further provided
that such excess amount shall neither be considered an Operating Expense nor be
paid out of the Collection Account or included in the calculation of True-Up
Adjustments, or (B) if BGE is not the Servicer, 1.25% of the aggregate
initial principal amount of Series A Rate Stabilization Bonds, provided,
however, that BGE may seek approval from the PSC for a higher fee to be
payable under Section 8.02(e)(ii) of the Indenture if it can
reasonably demonstrate to the PSC that the services cannot be obtained under
then-current market conditions for a fee of 1.25% of the aggregate initial
principal amount of Series A Rate Stabilization Bonds.

 

(iii)          The amount payable
for the Series A Rate Stabilization Bonds pursuant to Section 8.02(e)(iii) of
the Indenture, shall not exceed $100,000 in the aggregate annually, provided
that BGE may seek approval from the PSC to recover from Customers, in
accordance with the Financing Credit Order, any incremental costs it incurs to
provide administrative support services to the Issuer to the extent such
incremental costs exceed $100,000, and further provided that
such excess amount shall neither be considered an Operating Expense nor be paid
out of the Collection Account or included in the calculation of True-Up
Adjustments.

 

4

 

(iv)          The
amount payable with respect to the ordinary periodic Operating Expenses not
described above pursuant to Section 8.02(e)(iv) shall not
exceed $250,000 in the aggregate annually.

 

SECTION 4. 
Minimum Denominations.  The
Series A Rate Stabilization Bonds shall be issuable in the Minimum
Denomination and in integral multiples of $1,000 thereof.

 

SECTION 5. 
Certain Defined Terms.  Article I
of the Indenture provides that the meanings of certain defined terms used in
the Indenture shall, when applied to the Rate Stabilization Bonds of a
particular Series, be as defined in Appendix A to the Indenture.  Additionally, Article II of the
Indenture provides that with respect to a particular Series of Rate
Stabilization Bonds, certain terms will have the meanings specified in the
related Series Supplement.  With
respect to the Series A Rate Stabilization Bonds, the following
definitions shall apply:

 

“Initial Payment Date” shall mean the first Payment Date for a
Tranche of Series A Rate Stabilization Bonds specified in the Expected
Amortization Schedule which is attached as Schedule A hereto.

 

“Minimum Denomination” shall mean $100,000, or integral
multiples of $1,000 in excess thereof, except for one Rate Stabilization Bond
of each Tranche which may be of a smaller denomination.

 

“Rate Stabilization Bond Interest Rate” has the meaning set
forth in Section 2 of this Series Supplement.

 

“Payment Date” has the meaning set forth in Section 3(b) of
this Series Supplement.

 

“Periodic Interest” has the meaning set forth in Section 3(d) of
this Series Supplement.

 

“Series Issuance
Date” has the meaning set forth in Section 3(a) of this Series Supplement.

 

SECTION 6.  Delivery and Payment for the Series A
Rate Stabilization Bonds; Form of the Series A Rate Stabilization
Bonds.  The Indenture Trustee shall
deliver the Series A Rate Stabilization Bonds to the Issuer when
authenticated in accordance with Section 2.03 of the
Indenture.  The Series A Rate
Stabilization Bonds of each Tranche shall be in the form of Exhibits A-1
through A-3 hereto.

 

SECTION 7.  Ratification of Agreement.  As supplemented by this Series Supplement,
the Indenture is in all respects ratified and confirmed and the Indenture, as
so supplemented by this Series Supplement, shall be read, taken, and
construed as one and the same instrument. 
This Series Supplement amends, modifies and supplements the
Indenture only in so far as it relates to the Series A Rate Stabilization
Bonds.

 

5

 

SECTION 8.  Counterparts.  This Series Supplement may be executed
in any number of counterparts, each of which when so executed shall be deemed
to be an original, but all of such counterparts shall together constitute but
one and the same instrument.

 

SECTION 9.  GOVERNING LAW.  THIS SERIES SUPPLEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES
OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS;
PROVIDED THAT THE CREATION, ATTACHMENT AND PERFECTION OF ANY LIENS CREATED
UNDER THE INDENTURE IN RATE STABILIZATION PROPERTY, AND ALL RIGHTS AND REMEDIES
OF THE INDENTURE TRUSTEE AND THE HOLDERS WITH RESPECT TO SUCH RATE
STABILIZATION PROPERTY, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND.

 

SECTION 10.  Issuer Obligation.  No recourse may be taken directly or
indirectly, by the Holders with respect to the obligations of the Issuer on the
Rate Stabilization Bonds, under the Indenture or under this Series Supplement
or any certificate or other writing delivered in connection herewith or
therewith, against (i) the Indenture Trustee or the Managers in their
respective individual capacities, (ii) any owner of a limited liability
company interest in the Issuer (including BGE) or (iii) any shareholder,
partner, owner, beneficiary, agent, officer, director, employee or agent of the
Indenture Trustee, the Managers or any owner of a limited liability company
interest in the Issuer (including BGE) in its individual capacity, or of any
successor or assign of any of them in their respective individual or corporate
capacities, except as any such Person may have expressly agreed (it being
understood that none of the Indenture Trustee, the Managers and BGE have any
such obligations in their respective individual or corporate capacities).

 

6

 

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

 

 

	
   

  	
  RSB BONDCO LLC, as Issuer

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Charles A. Berardesco

  
	
   

  	
   

  	
  Name:

  	
  Charles A. Berardesco

  
	
   

  	
   

  	
  Title:

  	
  Secretary

  

 

Issuer Signature Page to
Series Supplement

 

 

	
   

  	
  DEUTSCHE BANK TRUST COMPANY AMERICAS, not in its individual capacity but
  solely in its capacity as Indenture Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Eileen Hughes

  
	
   

  	
   

  	
  Name:

  	
  Eileen Hughes

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Louis Bodi

  
	
   

  	
   

  	
  Name:

  	
  Louis Bodi

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

Trustee Signature Page to Series Supplement

 

 

SCHEDULE A

 

EXPECTED AMORTIZATION SCHEDULE

 

OUTSTANDING PRINCIPAL BALANCE PER TRANCHE

 

	
   

  	
   

  	
  Payment Date

  	
   

  	
  Tranche A-1

  	
   

  	
  Tranche A-2

  	
   

  	
  Tranche A-3

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Series Issuance Date

  	
   

  	
  $

  	
  284,000,000

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2008

  	
   

  	
  $

  	
  250,741,286

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2008

  	
   

  	
  $

  	
  225,198,598

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2009

  	
   

  	
  $

  	
  198,590,708

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2009

  	
   

  	
  $

  	
  171,674,318

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2010

  	
   

  	
  $

  	
  143,549,922

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2010

  	
   

  	
  $

  	
  115,131,815

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2011

  	
   

  	
  $

  	
  85,457,334

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2011

  	
   

  	
  $

  	
  55,423,848

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2012

  	
   

  	
  $

  	
  24,142,900

  	
   

  	
  $

  	
  220,000,000

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2012

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  212,419,156

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2013

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  179,418,862

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2013

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  145,855,662

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2014

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  110,970,180

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2014

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  75,433,398

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2015

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  38,549,788

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2015

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  925,060

  	
   

  	
  $

  	
  119,200,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2016

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  81,127,235

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  10/1/2016

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  41,269,298

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  4/1/2017

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  	
  $

  	
  0

  	
   

  	
   

  	
   

  

 

 

Exhibit A-1

 

UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
REGISTERED FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITARY TO THE NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITARY.  UNLESS THIS
SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

	
  REGISTERED NO. R-1

  	
  $284,000,000

  

 

CUSIP NO.                    

 

SEE REVERSE FOR CERTAIN DEFINITIONS

 

THE PRINCIPAL OF THIS
SERIES A, TRANCHE A-1
RATE STABILIZATION BOND (“THIS TRANCHE  A-1  RATE STABILIZATION BOND”) WILL BE PAID IN INSTALLMENTS AS SET
FORTH HEREIN.  ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS TRANCHE A-1 RATE STABILIZATION BOND AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.  THE HOLDER OF THIS TRANCHE A-1 RATE
STABILIZATION BOND HAS NO RECOURSE TO THE ISSUER HEREOF AND AGREES TO LOOK ONLY
TO THE RATE STABILIZATION BOND COLLATERAL, AS DESCRIBED IN THE INDENTURE AND
THE SERIES SUPPLEMENT REFERRED TO ON THE REVERSE HEREOF, FOR PAYMENT OF ANY
AMOUNTS DUE HEREUNDER.  ALL OBLIGATIONS
OF THE ISSUER OF THIS TRANCHE A-1 RATE STABILIZATION BOND UNDER THE TERMS OF
THE INDENTURE WILL BE RELEASED AND DISCHARGED UPON PAYMENT IN FULL HEREOF OR AS
OTHERWISE PROVIDED IN SECTION 3.10(b) OR ARTICLE IV OF
THE INDENTURE.  THE HOLDER OF THIS
TRANCHE A-1 RATE STABILIZATION BOND HEREBY COVENANTS AND AGREES THAT PRIOR TO
THE DATE WHICH IS ONE (1) YEAR AND ONE (1) DAY AFTER THE PAYMENT IN
FULL OF THE SERIES A RATE STABILIZATION BONDS, IT WILL NOT ACQUIESCE, PETITION
OR OTHERWISE INVOKE OR CAUSE THE ISSUER OR ANY MANAGER TO INVOKE THE PROCESS OF
ANY COURT OR GOVERNMENTAL AUTHORITY FOR THE PURPOSE OF COMMENCING OR SUSTAINING
AN INVOLUNTARY CASE AGAINST THE ISSUER 

 

 

UNDER ANY INSOLVENCY LAW
OR APPOINTING A RECEIVER, LIQUIDATOR, ASSIGNEE, TRUSTEE, CUSTODIAN,
SEQUESTRATOR OR OTHER SIMILAR OFFICIAL OF THE ISSUER OR ANY SUBSTANTIAL PART OF
ITS RESPECTIVE PROPERTY, OR ORDERING THE DISSOLUTION, WINDING UP OR LIQUIDATION
OF THE AFFAIRS OF THE ISSUER.  NOTHING IN
THIS PARAGRAPH SHALL PRECLUDE, OR BE DEEMED TO ESTOP, SUCH HOLDER (A) FROM
TAKING OR OMITTING TO TAKE ANY ACTION PRIOR TO SUCH DATE IN (I) ANY CASE
OR PROCEEDING VOLUNTARILY FILED OR COMMENCED BY OR ON BEHALF OF THE ISSUER
UNDER OR PURSUANT TO ANY SUCH LAW OR THE LLC AGREEMENT OR (II) ANY
INVOLUNTARY CASE OR PROCEEDING PERTAINING TO THE ISSUER WHICH IS FILED OR COMMENCED
BY OR ON BEHALF OF A PERSON OTHER THAN SUCH HOLDER AND IS NOT JOINED IN BY SUCH
HOLDER (OR ANY PERSON TO WHICH SUCH HOLDER SHALL HAVE ASSIGNED, TRANSFERRED OR
OTHERWISE CONVEYED ANY PART OF THE OBLIGATIONS OF THE ISSUER HEREUNDER)
UNDER OR PURSUANT TO ANY SUCH LAW, OR (B) FROM COMMENCING OR PROSECUTING
ANY LEGAL ACTION WHICH IS NOT AN INVOLUNTARY CASE OR PROCEEDING UNDER OR
PURSUANT TO ANY SUCH LAW AGAINST THE ISSUER OR ANY OF ITS PROPERTIES.

 

THE STATE OF MARYLAND AND
ANY OTHER GOVERNMENTAL UNIT ARE NOT OBLIGED TO PAY THE PRINCIPAL OF OR INTEREST
ON RSB BONDCO LLC RATE STABILIZATION BONDS, INCLUDING THIS TRANCHE A-1  RATE STABILIZATION BOND.  NEITHER THE FULL FAITH AND CREDIT NOR THE
TAXING POWER OF THE STATE OF MARYLAND OR ANY OTHER GOVERNMENTAL UNIT IS PLEDGED
TO THE PAYMENT OF THE PRINCIPAL OF OR INTEREST ON RSB BONDCO LLC RATE
STABILIZATION BONDS, INCLUDING THIS TRANCHE A-1  RATE STABILIZATION BOND.  THE STATE OF MARYLAND HAS PLEDGED, FOR THE
BENEFIT AND PROTECTION OF THE HOLDERS OF RSB BONDCO LLC  RATE STABILIZATION BONDS, INCLUDING THIS
TRANCHE A-1  RATE
STABILIZATION BOND, THAT IT WILL NOT TAKE OR ALLOW ANY ACTION THAT WOULD IMPAIR
THE VALUE OF THE RATE STABILIZATION PROPERTY, OR, EXCEPT AS ALLOWED BY
APPLICABLE SECTIONS OF THE RATE STABILIZATION ACT, REDUCE, ALTER OR IMPAIR THE
QUALIFIED RATE STABILIZATION CHARGES TO BE IMPOSED, COLLECTED AND REMITTED TO
THE INDENTURE TRUSTEE FOR THE BENEFIT OF THE HOLDERS OF RATE STABILIZATION
BONDS, INCLUDING THIS TRANCHE A-1  RATE STABILIZATION BOND, UNTIL THE PRINCIPAL, INTEREST
AND PREMIUM, AND ANY OTHER CHARGES INCURRED AND CONTRACTS TO BE PERFORMED IN
CONNECTION WITH THE RSB BONDCO LLC  RATE STABILIZATION BONDS, INCLUDING THIS TRANCHE A-1  RATE STABILIZATION BOND, HAVE BEEN PAID
AND PERFORMED IN FULL.

 

RSB BONDCO LLC RATE STABILIZATION BONDS,

 

Series A, Tranche A-1

 

	
  Interest Rate

  	
   

  	
  Original Principal Amount

  	
   

  	
  Final Maturity Date

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.47

  	
  %

  	
  $

  	
  284,000,000

  	
   

  	
  October 1, 2014

  	
   

  	
   

  	
   

  
									

 

 

RSB BONDCO LLC, a limited liability company formed under the laws of
the State of Delaware (herein referred to as the “Issuer”), for value
received, hereby promises to pay to Cede & Co., or registered assigns,
the Original Principal Amount shown above in semi-annual installments on the
Payment Dates and in the amounts specified on the reverse hereof or, if less,
the amounts determined pursuant to Section 8.02 of the Indenture,
in each year, commencing on the date determined as provided on the reverse
hereof and ending on or before the Final Maturity Date shown above and to pay
interest, at the Interest Rate shown above, on each April 1st and October 1st or if any such
day is not a Business Day, the next succeeding Business Day, commencing on April 1,
2008 and continuing until the earlier of the payment in full of the principal
hereof and the Final Maturity Date (each a “Payment Date”), on the
principal amount of this Series A, Tranche A-1 Rate Stabilization Bond (hereinafter
referred to as this “Tranche A-1 Rate Stabilization Bond”). 
Interest on this Tranche A-1 Rate Stabilization Bond will accrue for
each Payment Date from the most recent Payment Date on which interest has been
paid to but excluding such Payment Date or, if no interest has yet been paid,
from the date of issuance. Interest will be computed on the basis of a 360-day
year of twelve 30-day months.  Such
principal of and interest on this Tranche A-1 Rate Stabilization Bond shall be paid in
the manner specified on the reverse hereof.

 

The principal of and interest on this Tranche A-1 Rate Stabilization Bond are payable in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts.  All payments made by the Issuer with respect
to this Tranche A-1 Rate Stabilization Bond shall be applied first to
interest due and payable on this Tranche A-1 Rate Stabilization Bond as provided above
and then to the unpaid principal of and premium, if any, on this Tranche A-1 Rate Stabilization Bond, all in the
manner set forth in the Indenture.

 

Reference is made to the further provisions of this Tranche A-1 Rate Stabilization Bond set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Tranche A-1 Rate Stabilization Bond.

 

Unless the certificate of authentication hereon has been executed by
the Indenture Trustee whose name appears below by manual signature, this
Tranche A-1 Rate
Stabilization Bond shall not be entitled to any benefit under the Indenture
referred to on the reverse hereof, or be valid or obligatory for any purpose.

 

 

IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Responsible Officer.

 

 

	
  Date:

  	
  RSB BONDCO LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Issuer Signature Page to Tranche A-1 Rate Stabilization Bond

 

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

Dated:

 

This is one of the Series A, Tranche A-1 Rate Stabilization Bonds,
designated above and referred to in the within-mentioned Indenture.

 

 

	
   

  	
  DEUTSCHE BANK TRUST COMPANY AMERICAS, not in its individual capacity but
  solely as Indenture Trustee and as Securities Intermediary

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Trustee Signature Page to Tranche A-1 Rate Stabilization Bond

 

 

REVERSE OF RATE STABILIZATION BOND

 

This Series A, Tranche A-1 Rate Stabilization Bond is one of a duly
authorized issue of Rate Stabilization Bonds of the Issuer (herein called the “Rate
Stabilization Bonds”), issued and to be issued in one or more Series, which
Series are issuable in one or more Tranches, and the Series A Rate Stabilization
Bonds consists of three Tranches, including this Tranche A-1 Rate Stabilization
Bond (herein called the “Tranche A-1 Rate Stabilization Bonds”), all
issued and to be issued under that certain Indenture dated as of June 29,
2007 (as supplemented by the Series Supplement (as defined below), the “Indenture”),
between the Issuer and Deutsche Bank Trust Company Americas, in its capacity as
indenture trustee (the “Indenture Trustee”, which term includes any
successor indenture trustee under the Indenture) and in its separate capacity
as a securities intermediary (the “Securities Intermediary”, which term
includes any successor securities intermediary under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for
a statement of the respective rights and obligations thereunder of the Issuer,
the Indenture Trustee and the Holders of the Rate Stabilization Bonds.  For purposes herein, “Series Supplement”
means that certain Series Supplement dated as of June 29, 2007,
between the Issuer and the Indenture Trustee. 
All terms used in this Tranche A-1 Rate Stabilization Bond that are
defined in the Indenture, as amended, restated, supplemented or otherwise
modified from time to time, shall have the meanings assigned to such terms in
the Indenture.

 

The Tranche A-1 Rate Stabilization Bonds, the other Tranches of Series A
Rate Stabilization Bonds (all of such Tranches being referred to herein as “Series A
Rate Stabilization Bonds”) and any other Series of Rate Stabilization
Bonds issued by the Issuer are and will be equally and ratably secured by the Series Rate
Stabilization Bond Collateral pledged as security therefor as provided in the
Indenture.

 

The principal of this Tranche A-1 Rate Stabilization Bond shall be payable
on each Payment Date only to the extent that amounts in the applicable
Collection Account are available therefor, and only until the outstanding
principal balance thereof on such Payment Date (after giving effect to all
payments of principal, if any, made on such Payment Date) has been reduced to
the principal balance specified in the Expected Amortization Schedule which is
attached to the related Series Supplement as Schedule A, unless payable
earlier because an Event of Default shall have occurred and be continuing and
the Indenture Trustee or the Bondholders representing not less than a majority
of the Outstanding Amount of the Rate Stabilization Bonds of this Series have
declared such Rate Stabilization Bonds to be immediately due and payable in accordance
with Section 5.02 of the Indenture (unless such declaration shall
have been rescinded and annulled in accordance with Section 5.02 of
the Indenture).  However, actual
principal payments may be made in lesser than expected amounts and at later
than expected times as determined pursuant to Section 8.02 of the
Indenture.  The entire unpaid principal
amount of this Tranche A-1 Rate Stabilization Bond shall be due and payable on
the Final Maturity Date hereof. 
Notwithstanding the foregoing, the entire unpaid principal amount of the
Rate Stabilization Bonds shall be due and payable, if not then previously paid,
on the date on which an Event of Default shall have occurred and be continuing
and the Indenture Trustee or the Holders of the Rate Stabilization Bonds
representing not less than a majority of the Outstanding Amount of the Rate
Stabilization Bonds of this Series have 

 

1

 

declared the Rate Stabilization Bonds of this Series to
be immediately due and payable in the manner provided in Section 5.02
of the Indenture (unless such declaration shall have been rescinded and
annulled in accordance with Section 5.02 of the Indenture).  All principal payments on the Tranche A-1
Rate Stabilization Bonds shall be made pro rata to the Tranche A-1 Holders
entitled thereto based on the respective principal amounts of the Tranche A-1
Rate Stabilization Bonds held by them.

 

Payments of interest on this Tranche A-1 Rate Stabilization Bond due
and payable on each Payment Date, together with the installment of principal or
premium, if any, shall be made by check mailed first-class, postage prepaid, to
the Person whose name appears as the Registered Holder of this Tranche A-1 Rate
Stabilization Bond (or one or more Predecessor Rate Stabilization Bonds) on the
Rate Stabilization Bond Register on the Record Date or in such other manner as
may be provided in the Indenture or the related Series Supplement, except
that (i) upon application to the Indenture Trustee by any Holder owning a
Global Rate Stabilization Bond evidencing this Tranche A-1 Rate Stabilization
Bond in the principal amount of $10,000,000 or more not later than the
applicable Record Date payment will be made by wire transfer to an account
maintained by such Holder and (ii) if this Tranche A-1 Rate Stabilization
Bond is held in Book-Entry Form, payments will be made by wire transfer in
immediately available funds to the account designated by the Holder of the
applicable Global Rate Stabilization Bond evidencing this Tranche A-1 Rate
Stabilization Bond unless and until such Global Rate Stabilization Bond is
exchanged for Definitive Rate Stabilization Bonds (in which event payments
shall be made as provided above) and except for the final installment of
principal and premium, if any, payable with respect to this Tranche A-1 Rate
Stabilization Bond on a Payment Date which shall be payable as provided
below.  Such checks shall be mailed to
the Person entitled thereto at the address of such Person as it appears on the
Rate Stabilization Bond Register as of the applicable Record Date without
requiring that this Tranche A-1 Rate Stabilization Bond be submitted for
notation of payment.  Any reduction in
the principal amount of this Tranche A-1 Rate Stabilization Bond (or any one or
more Predecessor Rate Stabilization Bonds) effected by any payments made on any
Payment Date shall be binding upon all future Holders of this Tranche A-1 Rate
Stabilization Bond and of any Rate Stabilization Bond issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not noted hereon.  If funds
are expected to be available, as provided in the Indenture, for payment in full
of the then remaining unpaid principal amount of this Tranche A-1 Rate
Stabilization Bond on a Payment Date, then the Indenture Trustee, in the name
of and on behalf of the Issuer, will notify the Person who was the Registered
Holder hereof as of the Record Date preceding such Payment Date by notice
mailed no later than five (5) days prior to such final Payment Date and
shall specify that such final installment will be payable only upon
presentation and surrender of this Tranche A-1 Rate Stabilization Bond and
shall specify the place where this Tranche A-1 Rate Stabilization Bond may be
presented and surrendered for payment of such installment.

 

The Issuer shall pay interest on overdue installments of interest at
the Rate Stabilization Bond Interest Rate to the extent lawful.

 

This Rate Stabilization Bond is a “Rate Stabilization Bond” as such
term is defined in the Rate Stabilization Law. 
Principal and interest due and payable on this Rate 

 

2

 

Stabilization Bond are payable from and secured
primarily by Rate Stabilization Property created and established by a Qualified
Rate Order obtained from the Public Service Commission of Maryland pursuant to
the Rate Stabilization Law.  Rate
Stabilization Property consists of the rights and interests of the Seller in the
relevant Qualified Rate Order, including the right to impose, collect and
recover certain charges (defined in the Rate Stabilization Law as “Qualified
Rate Stabilization Charges”) to be included in regular electric utility
bills of existing and future residential electric delivery service customers
within the service territory of BGE, a Maryland electric utility, or its
successors or assigns, as more fully described in the Qualified Rate Order.

 

The Rate Stabilization Law provides that:  “The state pledges for the benefit and
protection of financing parties and the electric company, that it will not take
or allow any action that would impair the value of rate stabilization property,
or, except as allowed in accordance with Sections 7-531, 7-533, and 7-534 [of
the Rate Stabilization Law], reduce, alter, or impair the qualified rate
stabilization charges to be imposed, collected, and remitted to financing
parties, until the principal, interest and premium, and any other charges
incurred and contracts to be performed in connection with the related rate
stabilization bonds have been paid and performed in full.  Any party issuing rate stabilization bonds is
authorized to include this pledge in any documentation relating to those bonds.”

 

As a result of the foregoing pledge, the State of Maryland may not,
except as provided in the succeeding sentence, in any way reduce, alter or
impair the Qualified Rate Stabilization Charges until the Rate Stabilization
Bonds, together with interest thereon, are fully paid and discharged.  Notwithstanding the immediately preceding
sentence, the State of Maryland would be allowed to effect a temporary
impairment of the Holders’ rights if it could be shown that such impairment was
necessary to advance a significant and legitimate public purpose.

 

The Issuer and BGE hereby acknowledge that the purchase of this Rate
Stabilization Bond by the Holder hereof or the purchase of any beneficial
interest herein by any Person are made in reliance on the foregoing pledge.

 

As provided in the Indenture and subject to certain limitations set
forth therein, the transfer of this Tranche A-1 Rate Stabilization Bond may be
registered on the Rate Stabilization Bond Register upon surrender of this
Tranche A-1 Rate Stabilization Bond for registration of transfer at the office
or agency designated by the Issuer pursuant to the Indenture, duly endorsed by,
or accompanied by (a) a written instrument of transfer in form
satisfactory to the Indenture Trustee duly executed by the Holder hereof or
such Holder’s attorney duly authorized in writing, with such signature
guaranteed by an institution which is a member of one of the following
recognized Signature Guaranty Programs:  (i) The
Securities Transfer Agent Medallion Program (STAMP); (ii)The New York Stock
Exchange Medallion Program (MSP); (iii) The Stock Exchange Medallion
Program (SEMP); or (iv) in such other guarantee program acceptable to the
Indenture Trustee, and (b) such other documents as the Indenture Trustee
may require, and thereupon one or more new Tranche A-1 Rate Stabilization Bonds
of Minimum Denominations and in the same aggregate principal amount will be
issued to the designated transferee or transferees.  No service charge will be charged for any
registration of transfer or exchange of this Tranche A-1 Rate Stabilization
Bond, but the 

 

3

 

transferor may be required to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any such registration of transfer or exchange, other than exchanges
pursuant to Sections 2.04 or 2.06 of the Indenture not involving
any transfer.

 

Each Rate Stabilization Bond holder, by acceptance of a Rate
Stabilization Bond, covenants and agrees that no recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer or the
Indenture Trustee on the Rate Stabilization Bonds or under the Indenture or any
certificate or other writing delivered in connection therewith, against (i) the
Indenture Trustee or the Managers in their respective individual capacities, (ii) any
owner of a limited liability company interest in the Issuer (including BGE) or (iii)
any shareholder, partner, owner, beneficiary, agent, officer or employee of the
Indenture Trustee, the Managers or any owner of a limited liability company
interest in the Issuer (including BGE) in its respective individual or
corporate capacities, or of any successor or assign of any of them in their
individual or corporate capacities, except as any such Person may have
expressly agreed in writing (it being understood that none of the Indenture
Trustee, the Managers or BGE has any such obligations in their respective
individual or corporate capacities).

 

Prior to the due presentment for registration of transfer of this
Tranche A-1 Rate Stabilization Bond, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in whose name
this Tranche A-1 Rate Stabilization Bond is registered (as of the day of
determination) as the owner hereof for the purpose of receiving payments of
principal of and premium, if any, and interest on this Tranche A-1 Rate
Stabilization Bond and for all other purposes whatsoever, whether or not this
Tranche A-1 Rate Stabilization Bond be overdue, and neither the Issuer, the Indenture
Trustee nor any such agent shall be affected by notice to the contrary.

 

The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Rate Stabilization Bonds under the
Indenture at any time by the Issuer with the consent of the Bondholders
representing not less than a majority of the Outstanding Amount of all Rate
Stabilization Bonds at the time outstanding of each Series or Tranche to
be affected.  The Indenture also contains
provisions permitting the Bondholders representing specified percentages of the
Outstanding Amount of the Rate Stabilization Bonds of all Series, on behalf of
the Holders of all the Rate Stabilization Bonds, to waive compliance by the
Issuer with certain provisions of the Indenture and certain past defaults under
the Indenture and their consequences. 
Any such consent or waiver by the Holder of this Tranche A-1 Rate
Stabilization Bond (or any one of more Predecessor Rate Stabilization Bonds)
shall be conclusive and binding upon such Holder and upon all future Holders of
this Tranche A-1 Rate Stabilization Bond and of any Rate Stabilization Bond
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof whether or not notation of such consent or waiver is made upon this
Tranche A-1 Rate Stabilization Bond.  The
Indenture also permits the Indenture Trustee to amend or waive certain terms and
conditions set forth in the Indenture without the consent of Holders of the
Rate Stabilization Bonds issued thereunder.

 

The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Issuer on this Tranche A-1 Rate Stabilization Bond
and (b) certain 

 

4

 

restrictive covenants and the related Events of
Default, upon compliance by the Issuer with certain conditions set forth
therein, which provisions apply to this Tranche A-1 Rate Stabilization Bond.

 

The term “Issuer” as used in this Tranche A-1 Rate Stabilization Bond
includes any successor to the Issuer under the Indenture.

 

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

 

The Tranche A-1 Rate Stabilization Bonds are issuable only in
registered form in denominations as provided in the Indenture and the related Series Supplement
subject to certain limitations therein set forth.

 

THIS TRANCHE A-1 RATE STABILIZATION BOND, THE INDENTURE AND THE RELATED
SERIES SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS; PROVIDED THAT THE CREATION, ATTACHMENT AND
PERFECTION OF ANY LIENS CREATED UNDER THE INDENTURE IN RATE STABILIZATION
PROPERTY, AND ALL RIGHTS AND REMEDIES OF THE INDENTURE TRUSTEE AND THE HOLDERS
WITH RESPECT TO SUCH RATE STABILIZATION PROPERTY, SHALL BE GOVERNED BY THE LAWS
OF THE STATE OF MARYLAND.

 

No reference herein to the Indenture and no provision of this Tranche
A-1 Rate Stabilization Bond or of the Indenture shall alter or impair the
obligation, which is absolute and unconditional, to pay the principal of and
interest on this Tranche A-1 Rate Stabilization Bond at the times, place, and
rate, and in the coin or currency herein prescribed.

 

The Holder of this Tranche A-1 Rate Stabilization Bond by the
acceptance hereof agrees that, notwithstanding any provision of the Indenture
or the related Series Supplement to the contrary, the Holder shall have no
recourse against the Issuer, but shall look only to the Rate Stabilization Bond
Collateral, with respect to any amounts due to the Holder under this Tranche
A-1 Rate Stabilization Bond.

 

The Issuer and the Indenture Trustee, by entering into the Indenture,
and the Holders and any Persons holding a beneficial interest in any Tranche
A-1 Rate Stabilization Bond, by acquiring any Tranche A-1 Rate Stabilization
Bond or interest therein, (i) express their intention that, solely for the
purpose of federal taxes and, to the extent consistent with applicable state,
local and other tax law, solely for the purpose of state, local and other
taxes, the Tranche A-1 Rate Stabilization Bonds qualify under applicable tax
law as indebtedness of the sole owner of the Issuer secured by the Rate
Stabilization Bond Collateral and (ii) solely for purposes of federal
taxes and, to the extent consistent with applicable state, local and other tax
law, solely for purposes of state, local and other 

 

5

 

taxes, so long as any of the Tranche A-1 Rate
Stabilization Bonds are outstanding, agree to treat the Tranche A-1 Rate
Stabilization Bonds as indebtedness of the sole owner of the Issuer secured by
the Rate Stabilization Bond Collateral unless otherwise required by appropriate
taxing authorities.

 

6

 

ABBREVIATIONS

 

The following abbreviations, when used in the
inscription of the face of this Tranche A-1 Rate Stabilization Bond, shall be
construed as though they were written out in full according to applicable laws
or regulations.

 

	
  TEN COM

  	
  as tenants in common

  
	
   

  	
   

  
	
  TEN ENT

  	
  as tenants by the
  entireties

  
	
   

  	
   

  
	
  JT TEN

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

  
	
   

  	
   

  
	
  UNIF GIFT MIN ACT

  	
   

  	
  Custodian

  	
   

  
	
   

  	
  (Custodian)

  	
   

  	
  (minor)

  
	
   

  	
  Under Uniform
  Gifts to Minor Act   (

  	
   

  	
  )

  
	
   

  	
   

  	
  (State)

  	
   

  
						

 

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

 

 

ASSIGNMENT

 

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

 

FOR VALUE RECEIVED, the undersigned(1) hereby
sells, assigns and transfers unto

 

(name and address of assignee)

 

the
within Tranche A-1 Rate Stabilization Bond and all rights thereunder, and
hereby irrevocably constitutes and appoints                           ,
attorney, to transfer said Tranche A-1 Rate Stabilization Bond on the books
kept for registration thereof, with full power of substitution in the premises.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature Guaranteed:

  

 

(1)           RATE STABILIZATION BOND:  The signature to this assignment must
correspond with the name of the registered owner as it appears on the face of
the within Tranche A-1  Rate
Stabilization Bond in every particular, without alteration, enlargement or any
change whatsoever.

 

NOTE:  Signature(s) must be guaranteed by an
institution which is a member of one of the following recognized Signature
Guaranty Programs:  (i) The
Securities Transfer Agent Medallion Program (STAMP), (ii) The New York
Stock Exchange Medallion Program (MSP), (iii) the Stock Exchange Medallion
Program (SEMP) or (iv) such other guarantee program acceptable to the
Indenture Trustee.

 

 

Exhibit A-2

 

UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
REGISTERED FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITARY TO THE NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITARY.  UNLESS THIS
SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

	
  REGISTERED NO. R-2

  	
  $220,000,000

  

 

CUSIP NO.

 

SEE REVERSE FOR CERTAIN
DEFINITIONS

 

THE PRINCIPAL OF THIS
SERIES A, TRANCHE A-2
RATE STABILIZATION BOND (“THIS TRANCHE  A-2  RATE STABILIZATION BOND”) WILL BE PAID IN INSTALLMENTS AS SET
FORTH HEREIN.  ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS TRANCHE A-2 RATE STABILIZATION BOND AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.  THE HOLDER OF THIS TRANCHE A-2 RATE
STABILIZATION BOND HAS NO RECOURSE TO THE ISSUER HEREOF AND AGREES TO LOOK ONLY
TO THE RATE STABILIZATION BOND COLLATERAL, AS DESCRIBED IN THE INDENTURE AND
THE SERIES SUPPLEMENT REFERRED TO ON THE REVERSE HEREOF, FOR PAYMENT OF ANY
AMOUNTS DUE HEREUNDER.  ALL OBLIGATIONS
OF THE ISSUER OF THIS TRANCHE A-2 RATE STABILIZATION BOND UNDER THE TERMS OF
THE INDENTURE WILL BE RELEASED AND DISCHARGED UPON PAYMENT IN FULL HEREOF OR AS
OTHERWISE PROVIDED IN SECTION 3.10(b) OR ARTICLE IV OF
THE INDENTURE.  THE HOLDER OF THIS
TRANCHE A-2 RATE STABILIZATION BOND HEREBY COVENANTS AND AGREES THAT PRIOR TO
THE DATE WHICH IS ONE (1) YEAR AND ONE (1) DAY AFTER THE PAYMENT IN
FULL OF THE SERIES A RATE STABILIZATION BONDS, IT WILL NOT ACQUIESCE, PETITION
OR OTHERWISE INVOKE OR CAUSE THE ISSUER OR ANY MANAGER TO INVOKE THE PROCESS OF
ANY COURT OR GOVERNMENTAL AUTHORITY FOR THE PURPOSE OF COMMENCING OR SUSTAINING
AN INVOLUNTARY CASE AGAINST THE ISSUER 

 

 

UNDER ANY INSOLVENCY LAW
OR APPOINTING A RECEIVER, LIQUIDATOR, ASSIGNEE, TRUSTEE, CUSTODIAN,
SEQUESTRATOR OR OTHER SIMILAR OFFICIAL OF THE ISSUER OR ANY SUBSTANTIAL PART OF
ITS RESPECTIVE PROPERTY, OR ORDERING THE DISSOLUTION, WINDING UP OR LIQUIDATION
OF THE AFFAIRS OF THE ISSUER.  NOTHING IN
THIS PARAGRAPH SHALL PRECLUDE, OR BE DEEMED TO ESTOP, SUCH HOLDER (A) FROM
TAKING OR OMITTING TO TAKE ANY ACTION PRIOR TO SUCH DATE IN (I) ANY CASE
OR PROCEEDING VOLUNTARILY FILED OR COMMENCED BY OR ON BEHALF OF THE ISSUER
UNDER OR PURSUANT TO ANY SUCH LAW OR THE LLC AGREEMENT OR (II) ANY
INVOLUNTARY CASE OR PROCEEDING PERTAINING TO THE ISSUER WHICH IS FILED OR
COMMENCED BY OR ON BEHALF OF A PERSON OTHER THAN SUCH HOLDER AND IS NOT JOINED
IN BY SUCH HOLDER (OR ANY PERSON TO WHICH SUCH HOLDER SHALL HAVE ASSIGNED,
TRANSFERRED OR OTHERWISE CONVEYED ANY PART OF THE OBLIGATIONS OF THE ISSUER
HEREUNDER) UNDER OR PURSUANT TO ANY SUCH LAW, OR (B) FROM COMMENCING OR
PROSECUTING ANY LEGAL ACTION WHICH IS NOT AN INVOLUNTARY CASE OR PROCEEDING
UNDER OR PURSUANT TO ANY SUCH LAW AGAINST THE ISSUER OR ANY OF ITS PROPERTIES.

 

THE STATE OF MARYLAND AND
ANY OTHER GOVERNMENTAL UNIT ARE NOT OBLIGED TO PAY THE PRINCIPAL OF OR INTEREST
ON RSB BONDCO LLC RATE STABILIZATION BONDS, INCLUDING THIS TRANCHE A-2  RATE STABILIZATION BOND.  NEITHER THE FULL FAITH AND CREDIT NOR THE
TAXING POWER OF THE STATE OF MARYLAND OR ANY OTHER GOVERNMENTAL UNIT IS PLEDGED
TO THE PAYMENT OF THE PRINCIPAL OF OR INTEREST ON RSB BONDCO LLC RATE
STABILIZATION BONDS, INCLUDING THIS TRANCHE A-2  RATE STABILIZATION BOND.  THE STATE OF MARYLAND HAS PLEDGED, FOR THE
BENEFIT AND PROTECTION OF THE HOLDERS OF RSB BONDCO LLC  RATE STABILIZATION BONDS, INCLUDING THIS
TRANCHE A-2  RATE
STABILIZATION BOND, THAT IT WILL NOT TAKE OR ALLOW ANY ACTION THAT WOULD IMPAIR
THE VALUE OF THE RATE STABILIZATION PROPERTY, OR, EXCEPT AS ALLOWED BY
APPLICABLE SECTIONS OF THE RATE STABILIZATION ACT, REDUCE, ALTER OR IMPAIR THE
QUALIFIED RATE STABILIZATION CHARGES TO BE IMPOSED, COLLECTED AND REMITTED TO
THE INDENTURE TRUSTEE FOR THE BENEFIT OF THE HOLDERS OF RATE STABILIZATION
BONDS, INCLUDING THIS TRANCHE A-2  RATE STABILIZATION BOND, UNTIL THE PRINCIPAL, INTEREST
AND PREMIUM, AND ANY OTHER CHARGES INCURRED AND CONTRACTS TO BE PERFORMED IN
CONNECTION WITH THE RSB BONDCO LLC  RATE STABILIZATION BONDS, INCLUDING THIS TRANCHE A-2  RATE STABILIZATION BOND, HAVE BEEN PAID AND
PERFORMED IN FULL.

 

RSB BONDCO LLC RATE STABILIZATION
BONDS,

 

Series A, Tranche A-2

 

	
  Interest Rate

  	
   

  	
  Original Principal Amount

  	
   

  	
  Final Maturity Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.72

  	
  %

  	
  $

  	
  220,000,000

  	
   

  	
  April 1, 2018

  	
   

  
							

 

 

RSB BONDCO LLC, a limited liability company formed
under the laws of the State of Delaware (herein referred to as the “Issuer”),
for value received, hereby promises to pay to Cede & Co., or
registered assigns, the Original Principal Amount shown above in semi-annual
installments on the Payment Dates and in the amounts specified on the reverse
hereof or, if less, the amounts determined pursuant to Section 8.02
of the Indenture, in each year, commencing on the date determined as provided
on the reverse hereof and ending on or before the Final Maturity Date shown above
and to pay interest, at the Interest Rate shown above, on each April 1st and October 1st or if any such
day is not a Business Day, the next succeeding Business Day, commencing on April 1,
2008 and continuing until the earlier of the payment in full of the principal
hereof and the Final Maturity Date (each a “Payment Date”), on the
principal amount of this Series A, Tranche A-2 Rate Stabilization Bond (hereinafter
referred to as this “Tranche A-2 Rate Stabilization Bond”). 
Interest on this Tranche A-2 Rate Stabilization Bond will accrue for
each Payment Date from the most recent Payment Date on which interest has been
paid to but excluding such Payment Date or, if no interest has yet been paid,
from the date of issuance. Interest will be computed on the basis of a 360-day
year of twelve 30-day months.  Such
principal of and interest on this Tranche A-2 Rate Stabilization Bond shall be paid in
the manner specified on the reverse hereof.

 

The principal of and interest on this Tranche A-2 Rate Stabilization Bond are payable in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts.  All payments made by the Issuer with respect
to this Tranche A-2 Rate Stabilization Bond shall be applied first to
interest due and payable on this Tranche A-2 Rate Stabilization Bond as provided above
and then to the unpaid principal of and premium, if any, on this Tranche A-2 Rate Stabilization Bond, all in the
manner set forth in the Indenture.

 

Reference is made to the further provisions of this
Tranche A-2 Rate
Stabilization Bond set forth on the reverse hereof, which shall have the same
effect as though fully set forth on the face of this Tranche A-2 Rate Stabilization Bond.

 

Unless the certificate of authentication hereon has
been executed by the Indenture Trustee whose name appears below by manual
signature, this Tranche A-2 Rate Stabilization Bond shall not be entitled to any
benefit under the Indenture referred to on the reverse hereof, or be valid or
obligatory for any purpose.

 

 

IN WITNESS WHEREOF, the Issuer has caused this
instrument to be signed, manually or in facsimile, by its Responsible Officer.

 

 

	
  Date:

  	
  RSB BONDCO LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Issuer Signature Page to Tranche A-2 Rate Stabilization Bond

 

 

INDENTURE TRUSTEE’S CERTIFICATE
OF AUTHENTICATION

 

Dated:

 

This is one of the Series A, Tranche A-2 Rate
Stabilization Bonds, designated above and referred to in the within-mentioned
Indenture.

 

	
   

  	
  DEUTSCHE BANK TRUST COMPANY
  AMERICAS, not
  in its individual capacity but solely as Indenture Trustee and as Securities
  Intermediary

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Trustee Signature Page to Tranche A-2 Rate Stabilization Bond

 

 

REVERSE OF RATE STABILIZATION
BOND

 

This Series A, Tranche A-2 Rate Stabilization Bond is
one of a duly authorized issue of Rate Stabilization Bonds of the Issuer
(herein called the “Rate Stabilization Bonds”), issued and to be issued
in one or more Series, which Series are issuable in one or more Tranches, and
the Series A Rate Stabilization Bonds consists of three Tranches,
including this Tranche A-2 Rate Stabilization Bond (herein called the “Tranche
A-2 Rate Stabilization Bonds”), all issued and to be issued under that
certain Indenture dated as of June 29, 2007 (as supplemented by the Series Supplement
(as defined below), the “Indenture”), between the Issuer and Deutsche
Bank Trust Company Americas, in its capacity as indenture trustee (the “Indenture
Trustee”, which term includes any successor indenture trustee under the
Indenture) and in its separate capacity as a securities intermediary (the “Securities
Intermediary”, which term includes any successor securities intermediary
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Rate Stabilization Bonds.  For
purposes herein, “Series Supplement” means that certain Series Supplement
dated as of June 29, 2007, between the Issuer and the Indenture
Trustee.  All terms used in this Tranche
A-2 Rate Stabilization Bond that are defined in the Indenture, as amended,
restated, supplemented or otherwise modified from time to time, shall have the
meanings assigned to such terms in the Indenture.

 

The Tranche A-2 Rate Stabilization Bonds, the other
Tranches of Series A Rate Stabilization Bonds (all of such Tranches being
referred to herein as “Series A Rate Stabilization Bonds”) and any
other Series of Rate Stabilization Bonds issued by the Issuer are and will
be equally and ratably secured by the Series Rate Stabilization Bond
Collateral pledged as security therefor as provided in the Indenture.

 

The principal of this Tranche A-2 Rate Stabilization
Bond shall be payable on each Payment Date only to the extent that amounts in
the applicable Collection Account are available therefor, and only until the
outstanding principal balance thereof on such Payment Date (after giving effect
to all payments of principal, if any, made on such Payment Date) has been
reduced to the principal balance specified in the Expected Amortization
Schedule which is attached to the related Series Supplement as Schedule A,
unless payable earlier because an Event of Default shall have occurred and be
continuing and the Indenture Trustee or the Bondholders representing not less
than a majority of the Outstanding Amount of the Rate Stabilization Bonds of
this Series have declared such Rate Stabilization Bonds to be immediately
due and payable in accordance with Section 5.02 of the Indenture
(unless such declaration shall have been rescinded and annulled in accordance
with Section 5.02 of the Indenture).  However, actual principal payments may be
made in lesser than expected amounts and at later than expected times as
determined pursuant to Section 8.02 of the Indenture.  The entire unpaid principal amount of this
Tranche A-2 Rate Stabilization Bond shall be due and payable on the Final
Maturity Date hereof.  Notwithstanding the
foregoing, the entire unpaid principal amount of the Rate Stabilization Bonds
shall be due and payable, if not then previously paid, on the date on which an
Event of Default shall have occurred and be continuing and the Indenture
Trustee or the Holders of the Rate Stabilization Bonds representing not less
than a majority of the Outstanding Amount of the Rate Stabilization Bonds of
this Series have 

 

1

 

declared the Rate Stabilization Bonds of this Series to
be immediately due and payable in the manner provided in Section 5.02
of the Indenture (unless such declaration shall have been rescinded and
annulled in accordance with Section 5.02 of the Indenture).  All principal payments on the Tranche A-2
Rate Stabilization Bonds shall be made pro rata to the Tranche A-2 Holders
entitled thereto based on the respective principal amounts of the Tranche A-2
Rate Stabilization Bonds held by them.

 

Payments of interest on this Tranche A-2 Rate
Stabilization Bond due and payable on each Payment Date, together with the
installment of principal or premium, if any, shall be made by check mailed
first-class, postage prepaid, to the Person whose name appears as the
Registered Holder of this Tranche A-2 Rate Stabilization Bond (or one or more
Predecessor Rate Stabilization Bonds) on the Rate Stabilization Bond Register
on the Record Date or in such other manner as may be provided in the Indenture
or the related Series Supplement, except that (i) upon application to
the Indenture Trustee by any Holder owning a Global Rate Stabilization Bond
evidencing this Tranche A-2 Rate Stabilization Bond in the principal amount of
$10,000,000 or more not later than the applicable Record Date payment will be
made by wire transfer to an account maintained by such Holder and (ii) if
this Tranche A-2 Rate Stabilization Bond is held in Book-Entry Form, payments
will be made by wire transfer in immediately available funds to the account
designated by the Holder of the applicable Global Rate Stabilization Bond
evidencing this Tranche A-2 Rate Stabilization Bond unless and until such
Global Rate Stabilization Bond is exchanged for Definitive Rate Stabilization
Bonds (in which event payments shall be made as provided above) and except for
the final installment of principal and premium, if any, payable with respect to
this Tranche A-2 Rate Stabilization Bond on a Payment Date which shall be
payable as provided below.  Such checks
shall be mailed to the Person entitled thereto at the address of such Person as
it appears on the Rate Stabilization Bond Register as of the applicable Record
Date without requiring that this Tranche A-2 Rate Stabilization Bond be
submitted for notation of payment.  Any
reduction in the principal amount of this Tranche A-2 Rate Stabilization Bond
(or any one or more Predecessor Rate Stabilization Bonds) effected by any
payments made on any Payment Date shall be binding upon all future Holders of
this Tranche A-2 Rate Stabilization Bond and of any Rate Stabilization Bond
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof, whether or not noted hereon. 
If funds are expected to be available, as provided in the Indenture, for
payment in full of the then remaining unpaid principal amount of this Tranche
A-2 Rate Stabilization Bond on a Payment Date, then the Indenture Trustee, in
the name of and on behalf of the Issuer, will notify the Person who was the
Registered Holder hereof as of the Record Date preceding such Payment Date by
notice mailed no later than five (5) days prior to such final Payment Date
and shall specify that such final installment will be payable only upon
presentation and surrender of this Tranche A-2 Rate Stabilization Bond and
shall specify the place where this Tranche A-2 Rate Stabilization Bond may be
presented and surrendered for payment of such installment.

 

The Issuer shall pay interest on overdue installments
of interest at the Rate Stabilization Bond Interest Rate to the extent lawful.

 

This Rate Stabilization Bond is a “Rate Stabilization
Bond” as such term is defined in the Rate Stabilization Law.  Principal and interest due and payable on
this Rate 

 

2

 

Stabilization Bond are payable from and secured
primarily by Rate Stabilization Property created and established by a Qualified
Rate Order obtained from the Public Service Commission of Maryland pursuant to
the Rate Stabilization Law.  Rate
Stabilization Property consists of the rights and interests of the Seller in
the relevant Qualified Rate Order, including the right to impose, collect and
recover certain charges (defined in the Rate Stabilization Law as “Qualified
Rate Stabilization Charges”) to be included in regular electric utility
bills of existing and future residential electric delivery service customers
within the service territory of BGE, a Maryland electric utility, or its
successors or assigns, as more fully described in the Qualified Rate Order.

 

The Rate Stabilization Law provides that:  “The state pledges for the benefit and
protection of financing parties and the electric company, that it will not take
or allow any action that would impair the value of rate stabilization property,
or, except as allowed in accordance with Sections 7-531, 7-533, and 7-534 [of
the Rate Stabilization Law], reduce, alter, or impair the qualified rate
stabilization charges to be imposed, collected, and remitted to financing
parties, until the principal, interest and premium, and any other charges
incurred and contracts to be performed in connection with the related rate
stabilization bonds have been paid and performed in full.  Any party issuing rate stabilization bonds is
authorized to include this pledge in any documentation relating to those bonds.”

 

As a result of the foregoing pledge, the State of
Maryland may not, except as provided in the succeeding sentence, in any way
reduce, alter or impair the Qualified Rate Stabilization Charges until the Rate
Stabilization Bonds, together with interest thereon, are fully paid and
discharged.  Notwithstanding the
immediately preceding sentence, the State of Maryland would be allowed to
effect a temporary impairment of the Holders’ rights if it could be shown that
such impairment was necessary to advance a significant and legitimate public
purpose.

 

The Issuer and BGE hereby acknowledge that the
purchase of this Rate Stabilization Bond by the Holder hereof or the purchase
of any beneficial interest herein by any Person are made in reliance on the
foregoing pledge.

 

As provided in the Indenture and subject to certain
limitations set forth therein, the transfer of this Tranche A-2 Rate
Stabilization Bond may be registered on the Rate Stabilization Bond Register
upon surrender of this Tranche A-2 Rate Stabilization Bond for registration of
transfer at the office or agency designated by the Issuer pursuant to the
Indenture, duly endorsed by, or accompanied by (a) a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by the
Holder hereof or such Holder’s attorney duly authorized in writing, with such
signature guaranteed by an institution which is a member of one of the
following recognized Signature Guaranty Programs:  (i) The Securities Transfer Agent
Medallion Program (STAMP); (ii)The New York Stock Exchange Medallion Program
(MSP); (iii) The Stock Exchange Medallion Program (SEMP); or (iv) in
such other guarantee program acceptable to the Indenture Trustee, and (b) such
other documents as the Indenture Trustee may require, and thereupon one or more
new Tranche A-2 Rate Stabilization Bonds of Minimum Denominations and in the
same aggregate principal amount will be issued to the designated transferee or
transferees.  No service charge will be
charged for any registration of transfer or exchange of this Tranche A-2 Rate
Stabilization Bond, but the 

 

3

 

transferor may be required to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any such registration of transfer or exchange, other than exchanges
pursuant to Sections 2.04 or 2.06 of the Indenture not involving
any transfer.

 

Each Rate Stabilization Bond holder, by acceptance of
a Rate Stabilization Bond, covenants and agrees that no recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer or the
Indenture Trustee on the Rate Stabilization Bonds or under the Indenture or any
certificate or other writing delivered in connection therewith, against (i) the
Indenture Trustee or the Managers in their respective individual capacities, (ii) any
owner of a limited liability company interest in the Issuer (including BGE) or (iii) any
shareholder, partner, owner, beneficiary, agent, officer or employee of the
Indenture Trustee, the Managers or any owner of a limited liability company
interest in the Issuer (including BGE) in its respective individual or
corporate capacities, or of any successor or assign of any of them in their
individual or corporate capacities, except as any such Person may have
expressly agreed in writing (it being understood that none of the Indenture
Trustee, the Managers or BGE has any such obligations in their respective
individual or corporate capacities).

 

Prior to the due presentment for registration of
transfer of this Tranche A-2 Rate Stabilization Bond, the Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee may treat the
Person in whose name this Tranche A-2 Rate Stabilization Bond is registered (as
of the day of determination) as the owner hereof for the purpose of receiving
payments of principal of and premium, if any, and interest on this Tranche A-2
Rate Stabilization Bond and for all other purposes whatsoever, whether or not
this Tranche A-2 Rate Stabilization Bond be overdue, and neither the Issuer,
the Indenture Trustee nor any such agent shall be affected by notice to the
contrary.

 

The Indenture permits, with certain exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Rate
Stabilization Bonds under the Indenture at any time by the Issuer with the
consent of the Bondholders representing not less than a majority of the
Outstanding Amount of all Rate Stabilization Bonds at the time outstanding of
each Series or Tranche to be affected. 
The Indenture also contains provisions permitting the Bondholders
representing specified percentages of the Outstanding Amount of the Rate
Stabilization Bonds of all Series, on behalf of the Holders of all the Rate
Stabilization Bonds, to waive compliance by the Issuer with certain provisions
of the Indenture and certain past defaults under the Indenture and their
consequences.  Any such consent or waiver
by the Holder of this Tranche A-2 Rate Stabilization Bond (or any one of more
Predecessor Rate Stabilization Bonds) shall be conclusive and binding upon such
Holder and upon all future Holders of this Tranche A-2 Rate Stabilization Bond
and of any Rate Stabilization Bond issued upon the registration of transfer
hereof or in exchange hereof or in lieu hereof whether or not notation of such
consent or waiver is made upon this Tranche A-2 Rate Stabilization Bond.  The Indenture also permits the Indenture
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Rate Stabilization Bonds issued
thereunder.

 

The Indenture contains provisions for defeasance at
any time of (a) the entire indebtedness of the Issuer on this Tranche A-2
Rate Stabilization Bond and (b) certain 

 

4

 

restrictive covenants and the related Events of
Default, upon compliance by the Issuer with certain conditions set forth
therein, which provisions apply to this Tranche A-2 Rate Stabilization Bond.

 

The term “Issuer” as used in this Tranche A-2 Rate
Stabilization Bond includes any successor to the Issuer under the Indenture.

 

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

 

The Tranche A-2 Rate Stabilization Bonds are issuable
only in registered form in denominations as provided in the Indenture and the
related Series Supplement subject to certain limitations therein set
forth.

 

THIS TRANCHE A-2 RATE STABILIZATION BOND, THE
INDENTURE AND THE RELATED SERIES SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF
LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS; PROVIDED
THAT THE CREATION, ATTACHMENT AND PERFECTION OF ANY LIENS CREATED UNDER THE
INDENTURE IN RATE STABILIZATION PROPERTY, AND ALL RIGHTS AND REMEDIES OF THE
INDENTURE TRUSTEE AND THE HOLDERS WITH RESPECT TO SUCH RATE STABILIZATION
PROPERTY, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND.

 

No reference herein to the Indenture and no provision
of this Tranche A-2 Rate Stabilization Bond or of the Indenture shall alter or
impair the obligation, which is absolute and unconditional, to pay the
principal of and interest on this Tranche A-2 Rate Stabilization Bond at the
times, place, and rate, and in the coin or currency herein prescribed.

 

The Holder of this Tranche A-2 Rate Stabilization Bond
by the acceptance hereof agrees that, notwithstanding any provision of the
Indenture or the related Series Supplement to the contrary, the Holder
shall have no recourse against the Issuer, but shall look only to the Rate
Stabilization Bond Collateral, with respect to any amounts due to the Holder
under this Tranche A-2 Rate Stabilization Bond.

 

The Issuer and the Indenture Trustee, by entering into
the Indenture, and the Holders and any Persons holding a beneficial interest in
any Tranche A-2 Rate Stabilization Bond, by acquiring any Tranche A-2 Rate
Stabilization Bond or interest therein, (i) express their intention that,
solely for the purpose of federal taxes and, to the extent consistent with
applicable state, local and other tax law, solely for the purpose of state,
local and other taxes, the Tranche A-2 Rate Stabilization Bonds qualify under
applicable tax law as indebtedness of the sole owner of the Issuer secured by
the Rate Stabilization Bond Collateral and (ii) solely for purposes of
federal taxes and, to the extent consistent with applicable state, local and
other tax law, solely for purposes of state, local and other 

 

5

 

taxes, so long as any of the Tranche A-2 Rate
Stabilization Bonds are outstanding, agree to treat the Tranche A-2 Rate
Stabilization Bonds as indebtedness of the sole owner of the Issuer secured by
the Rate Stabilization Bond Collateral unless otherwise required by appropriate
taxing authorities.

 

6

 

ABBREVIATIONS

 

The following abbreviations, when used in the
inscription of the face of this Tranche A-2 Rate Stabilization Bond, shall be
construed as though they were written out in full according to applicable laws
or regulations.

 

	
  TEN COM

  	
  as tenants in common

  
	
   

  	
   

  
	
  TEN ENT

  	
  as tenants by the
  entireties

  
	
   

  	
   

  
	
  JT TEN

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

  
	
   

  	
   

  
	
  UNIF GIFT MIN ACT

  	
   

  	
  Custodian

  	
   

  
	
   

  	
  (Custodian)

  	
   

  	
  (minor)

  
	
   

  	
  Under Uniform
  Gifts to Minor Act   (

  	
   

  	
  )

  
	
   

  	
   

  	
  (State)

  	
   

  
						

 

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

 

 

ASSIGNMENT

 

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

 

FOR VALUE RECEIVED, the undersigned(2) hereby
sells, assigns and transfers unto

 

(name and address of assignee)

 

the
within Tranche A-2 Rate Stabilization Bond and all rights thereunder, and
hereby irrevocably constitutes and appoints                           ,
attorney, to transfer said Tranche A-2 Rate Stabilization Bond on the books
kept for registration thereof, with full power of substitution in the premises.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature Guaranteed:

  

 

(2)           RATE STABILIZATION BOND:  The signature to this assignment must
correspond with the name of the registered owner as it appears on the face of
the within Tranche A-2 Rate Stabilization Bond in every particular, without alteration,
enlargement or any change whatsoever.

 

NOTE:  Signature(s) must be guaranteed by an
institution which is a member of one of the following recognized Signature
Guaranty Programs:  (i) The
Securities Transfer Agent Medallion Program (STAMP), (ii) The New York
Stock Exchange Medallion Program (MSP), (iii) the Stock Exchange Medallion
Program (SEMP) or (iv) such other guarantee program acceptable to the
Indenture Trustee.

 

 

Exhibit A-3

 

UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
REGISTERED FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY
THE DEPOSITARY TO THE NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITARY.  UNLESS THIS
SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &
CO., HAS AN INTEREST HEREIN.

 

	
  REGISTERED NO. R-3

  	
  $119,200,000

  

 

CUSIP NO.

 

SEE REVERSE FOR CERTAIN
DEFINITIONS

 

THE PRINCIPAL OF THIS
SERIES A, TRANCHE A-3
RATE STABILIZATION BOND (“THIS TRANCHE  A-3  RATE STABILIZATION BOND”) WILL BE PAID IN INSTALLMENTS AS SET
FORTH HEREIN.  ACCORDINGLY, THE
OUTSTANDING PRINCIPAL AMOUNT OF THIS TRANCHE A-3 RATE STABILIZATION BOND AT ANY
TIME MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.  THE HOLDER OF THIS TRANCHE A-3 RATE
STABILIZATION BOND HAS NO RECOURSE TO THE ISSUER HEREOF AND AGREES TO LOOK ONLY
TO THE RATE STABILIZATION BOND COLLATERAL, AS DESCRIBED IN THE INDENTURE AND
THE SERIES SUPPLEMENT REFERRED TO ON THE REVERSE HEREOF, FOR PAYMENT OF ANY
AMOUNTS DUE HEREUNDER.  ALL OBLIGATIONS
OF THE ISSUER OF THIS TRANCHE A-3 RATE STABILIZATION BOND UNDER THE TERMS OF
THE INDENTURE WILL BE RELEASED AND DISCHARGED UPON PAYMENT IN FULL HEREOF OR AS
OTHERWISE PROVIDED IN SECTION 3.10(b) OR ARTICLE IV OF
THE INDENTURE.  THE HOLDER OF THIS
TRANCHE A-3 RATE STABILIZATION BOND HEREBY COVENANTS AND AGREES THAT PRIOR TO
THE DATE WHICH IS ONE (1) YEAR AND ONE (1) DAY AFTER THE PAYMENT IN
FULL OF THE SERIES A RATE STABILIZATION BONDS, IT WILL NOT ACQUIESCE, PETITION
OR OTHERWISE INVOKE OR CAUSE THE ISSUER OR ANY MANAGER TO INVOKE THE PROCESS OF
ANY COURT OR GOVERNMENTAL AUTHORITY FOR THE PURPOSE OF COMMENCING OR SUSTAINING
AN INVOLUNTARY CASE AGAINST THE ISSUER 

 

 

UNDER ANY INSOLVENCY LAW
OR APPOINTING A RECEIVER, LIQUIDATOR, ASSIGNEE, TRUSTEE, CUSTODIAN,
SEQUESTRATOR OR OTHER SIMILAR OFFICIAL OF THE ISSUER OR ANY SUBSTANTIAL PART OF
ITS RESPECTIVE PROPERTY, OR ORDERING THE DISSOLUTION, WINDING UP OR LIQUIDATION
OF THE AFFAIRS OF THE ISSUER.  NOTHING IN
THIS PARAGRAPH SHALL PRECLUDE, OR BE DEEMED TO ESTOP, SUCH HOLDER (A) FROM
TAKING OR OMITTING TO TAKE ANY ACTION PRIOR TO SUCH DATE IN (I) ANY CASE
OR PROCEEDING VOLUNTARILY FILED OR COMMENCED BY OR ON BEHALF OF THE ISSUER
UNDER OR PURSUANT TO ANY SUCH LAW OR THE LLC AGREEMENT OR (II) ANY
INVOLUNTARY CASE OR PROCEEDING PERTAINING TO THE ISSUER WHICH IS FILED OR
COMMENCED BY OR ON BEHALF OF A PERSON OTHER THAN SUCH HOLDER AND IS NOT JOINED
IN BY SUCH HOLDER (OR ANY PERSON TO WHICH SUCH HOLDER SHALL HAVE ASSIGNED,
TRANSFERRED OR OTHERWISE CONVEYED ANY PART OF THE OBLIGATIONS OF THE
ISSUER HEREUNDER) UNDER OR PURSUANT TO ANY SUCH LAW, OR (B) FROM COMMENCING
OR PROSECUTING ANY LEGAL ACTION WHICH IS NOT AN INVOLUNTARY CASE OR PROCEEDING
UNDER OR PURSUANT TO ANY SUCH LAW AGAINST THE ISSUER OR ANY OF ITS PROPERTIES.

 

THE STATE OF MARYLAND AND
ANY OTHER GOVERNMENTAL UNIT ARE NOT OBLIGED TO PAY THE PRINCIPAL OF OR INTEREST
ON RSB BONDCO LLC RATE STABILIZATION BONDS, INCLUDING THIS TRANCHE A-3  RATE STABILIZATION BOND.  NEITHER THE FULL FAITH AND CREDIT NOR THE
TAXING POWER OF THE STATE OF MARYLAND OR ANY OTHER GOVERNMENTAL UNIT IS PLEDGED
TO THE PAYMENT OF THE PRINCIPAL OF OR INTEREST ON RSB BONDCO LLC RATE
STABILIZATION BONDS, INCLUDING THIS TRANCHE A-3  RATE STABILIZATION BOND.  THE STATE OF MARYLAND HAS PLEDGED, FOR THE
BENEFIT AND PROTECTION OF THE HOLDERS OF RSB BONDCO LLC  RATE STABILIZATION BONDS, INCLUDING THIS
TRANCHE A-3  RATE
STABILIZATION BOND, THAT IT WILL NOT TAKE OR ALLOW ANY ACTION THAT WOULD IMPAIR
THE VALUE OF THE RATE STABILIZATION PROPERTY, OR, EXCEPT AS ALLOWED BY
APPLICABLE SECTIONS OF THE RATE STABILIZATION ACT, REDUCE, ALTER OR IMPAIR THE
QUALIFIED RATE STABILIZATION CHARGES TO BE IMPOSED, COLLECTED AND REMITTED TO
THE INDENTURE TRUSTEE FOR THE BENEFIT OF THE HOLDERS OF RATE STABILIZATION
BONDS, INCLUDING THIS TRANCHE A-3  RATE STABILIZATION BOND, UNTIL THE PRINCIPAL, INTEREST
AND PREMIUM, AND ANY OTHER CHARGES INCURRED AND CONTRACTS TO BE PERFORMED IN
CONNECTION WITH THE RSB BONDCO LLC  RATE STABILIZATION BONDS, INCLUDING THIS TRANCHE A-3  RATE STABILIZATION BOND, HAVE BEEN PAID
AND PERFORMED IN FULL.

 

RSB BONDCO LLC RATE STABILIZATION
BONDS,

 

Series A, Tranche A-3

 

	
  Interest Rate

  	
   

  	
  Original Principal Amount

  	
   

  	
  Final Maturity Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.82

  	
  %

  	
  $

  	
  119,200,000

  	
   

  	
  June 28, 2019

  	
   

  
							

 

 

RSB BONDCO LLC, a limited liability company formed
under the laws of the State of Delaware (herein referred to as the “Issuer”),
for value received, hereby promises to pay to Cede & Co., or
registered assigns, the Original Principal Amount shown above in semi-annual
installments on the Payment Dates and in the amounts specified on the reverse
hereof or, if less, the amounts determined pursuant to Section 8.02
of the Indenture, in each year, commencing on the date determined as provided
on the reverse hereof and ending on or before the Final Maturity Date shown
above and to pay interest, at the Interest Rate shown above, on each April 1st and October 1st or if any such
day is not a Business Day, the next succeeding Business Day, commencing on April 1,
2008 and continuing until the earlier of the payment in full of the principal
hereof and the Final Maturity Date (each a “Payment Date”), on the
principal amount of this Series A, Tranche A-3 Rate Stabilization Bond (hereinafter
referred to as this “Tranche A-3 Rate Stabilization Bond”). 
Interest on this Tranche A-3 Rate Stabilization Bond will accrue for
each Payment Date from the most recent Payment Date on which interest has been
paid to but excluding such Payment Date or, if no interest has yet been paid,
from the date of issuance. Interest will be computed on the basis of a 360-day
year of twelve 30-day months.  Such
principal of and interest on this Tranche A-3 Rate Stabilization Bond shall be paid in
the manner specified on the reverse hereof.

 

The principal of and interest on this Tranche A-3 Rate Stabilization Bond are payable in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts.  All payments made by the Issuer with respect
to this Tranche A-3 Rate Stabilization Bond shall be applied first to
interest due and payable on this Tranche A-3 Rate Stabilization Bond as provided above
and then to the unpaid principal of and premium, if any, on this Tranche A-3 Rate Stabilization Bond, all in the
manner set forth in the Indenture.

 

Reference is made to the further provisions of this
Tranche A-3 Rate
Stabilization Bond set forth on the reverse hereof, which shall have the same
effect as though fully set forth on the face of this Tranche A-3 Rate Stabilization Bond.

 

Unless the certificate of authentication hereon has
been executed by the Indenture Trustee whose name appears below by manual
signature, this Tranche A-3 Rate Stabilization Bond shall not be entitled to any
benefit under the Indenture referred to on the reverse hereof, or be valid or
obligatory for any purpose.

 

 

IN WITNESS WHEREOF, the Issuer has caused this
instrument to be signed, manually or in facsimile, by its Responsible Officer.

 

 

	
  Date:

  	
  RSB BONDCO LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Issuer Signature Page to Tranche A-3 Rate Stabilization Bond

 

 

INDENTURE TRUSTEE’S CERTIFICATE OF
AUTHENTICATION

 

Dated:

 

This is one of the Series A, Tranche A-3 Rate
Stabilization Bonds, designated above and referred to in the within-mentioned
Indenture.

 

	
   

  	
  DEUTSCHE BANK TRUST COMPANY
  AMERICAS, not
  in its individual capacity but solely as Indenture Trustee and as Securities
  Intermediary

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

Trustee Signature Page to Tranche A-3 Rate Stabilization Bond

 

 

REVERSE OF RATE STABILIZATION
BOND

 

This Series A, Tranche A-3 Rate Stabilization Bond is
one of a duly authorized issue of Rate Stabilization Bonds of the Issuer
(herein called the “Rate Stabilization Bonds”), issued and to be issued
in one or more Series, which Series are issuable in one or more Tranches,
and the Series A Rate Stabilization Bonds consists of three Tranches,
including this Tranche A-3 Rate Stabilization Bond (herein called the “Tranche
A-3 Rate Stabilization Bonds”), all issued and to be issued under that
certain Indenture dated as of June 29, 2007 (as supplemented by the Series Supplement
(as defined below), the “Indenture”), between the Issuer and Deutsche
Bank Trust Company Americas, in its capacity as indenture trustee (the “Indenture
Trustee”, which term includes any successor indenture trustee under the
Indenture) and in its separate capacity as a securities intermediary (the “Securities
Intermediary”, which term includes any successor securities intermediary
under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Rate Stabilization Bonds.  For
purposes herein, “Series Supplement” means that certain Series Supplement
dated as of June 29, 2007, between the Issuer and the Indenture
Trustee.  All terms used in this Tranche
A-3 Rate Stabilization Bond that are defined in the Indenture, as amended,
restated, supplemented or otherwise modified from time to time, shall have the
meanings assigned to such terms in the Indenture.

 

The Tranche A-3 Rate Stabilization Bonds, the other
Tranches of Series A Rate Stabilization Bonds (all of such Tranches being
referred to herein as “Series A Rate Stabilization Bonds”) and any
other Series of Rate Stabilization Bonds issued by the Issuer are and will
be equally and ratably secured by the Series Rate Stabilization Bond
Collateral pledged as security therefor as provided in the Indenture.

 

The principal of this Tranche A-3 Rate Stabilization
Bond shall be payable on each Payment Date only to the extent that amounts in
the applicable Collection Account are available therefor, and only until the
outstanding principal balance thereof on such Payment Date (after giving effect
to all payments of principal, if any, made on such Payment Date) has been reduced
to the principal balance specified in the Expected Amortization Schedule which
is attached to the related Series Supplement as Schedule A, unless payable
earlier because an Event of Default shall have occurred and be continuing and
the Indenture Trustee or the Bondholders representing not less than a majority
of the Outstanding Amount of the Rate Stabilization Bonds of this Series have
declared such Rate Stabilization Bonds to be immediately due and payable in
accordance with Section 5.02 of the Indenture (unless such
declaration shall have been rescinded and annulled in accordance with Section 5.02
of the Indenture).  However, actual
principal payments may be made in lesser than expected amounts and at later
than expected times as determined pursuant to Section 8.02 of the
Indenture.  The entire unpaid principal
amount of this Tranche A-3 Rate Stabilization Bond shall be due and payable on
the Final Maturity Date hereof. 
Notwithstanding the foregoing, the entire unpaid principal amount of the
Rate Stabilization Bonds shall be due and payable, if not then previously paid,
on the date on which an Event of Default shall have occurred and be continuing
and the Indenture Trustee or the Holders of the Rate Stabilization Bonds
representing not less than a majority of the Outstanding Amount of the Rate
Stabilization Bonds of this Series have 

 

1

 

declared the Rate Stabilization Bonds of this Series to
be immediately due and payable in the manner provided in Section 5.02
of the Indenture (unless such declaration shall have been rescinded and
annulled in accordance with Section 5.02 of the Indenture).  All principal payments on the Tranche A-3
Rate Stabilization Bonds shall be made pro rata to the Tranche A-3 Holders entitled
thereto based on the respective principal amounts of the Tranche A-3 Rate
Stabilization Bonds held by them.

 

Payments of interest on this Tranche A-3 Rate
Stabilization Bond due and payable on each Payment Date, together with the
installment of principal or premium, if any, shall be made by check mailed
first-class, postage prepaid, to the Person whose name appears as the
Registered Holder of this Tranche A-3 Rate Stabilization Bond (or one or more
Predecessor Rate Stabilization Bonds) on the Rate Stabilization Bond Register
on the Record Date or in such other manner as may be provided in the Indenture
or the related Series Supplement, except that (i) upon application to
the Indenture Trustee by any Holder owning a Global Rate Stabilization Bond
evidencing this Tranche A-3 Rate Stabilization Bond in the principal amount of
$10,000,000 or more not later than the applicable Record Date payment will be
made by wire transfer to an account maintained by such Holder and (ii) if
this Tranche A-3 Rate Stabilization Bond is held in Book-Entry Form, payments
will be made by wire transfer in immediately available funds to the account
designated by the Holder of the applicable Global Rate Stabilization Bond
evidencing this Tranche A-3 Rate Stabilization Bond unless and until such
Global Rate Stabilization Bond is exchanged for Definitive Rate Stabilization
Bonds (in which event payments shall be made as provided above) and except for
the final installment of principal and premium, if any, payable with respect to
this Tranche A-3 Rate Stabilization Bond on a Payment Date which shall be
payable as provided below.  Such checks
shall be mailed to the Person entitled thereto at the address of such Person as
it appears on the Rate Stabilization Bond Register as of the applicable Record
Date without requiring that this Tranche A-3 Rate Stabilization Bond be
submitted for notation of payment.  Any
reduction in the principal amount of this Tranche A-3 Rate Stabilization Bond
(or any one or more Predecessor Rate Stabilization Bonds) effected by any
payments made on any Payment Date shall be binding upon all future Holders of
this Tranche A-3 Rate Stabilization Bond and of any Rate Stabilization Bond
issued upon the registration of transfer hereof or in exchange hereof or in
lieu hereof, whether or not noted hereon. 
If funds are expected to be available, as provided in the Indenture, for
payment in full of the then remaining unpaid principal amount of this Tranche
A-3 Rate Stabilization Bond on a Payment Date, then the Indenture Trustee, in
the name of and on behalf of the Issuer, will notify the Person who was the
Registered Holder hereof as of the Record Date preceding such Payment Date by
notice mailed no later than five (5) days prior to such final Payment Date
and shall specify that such final installment will be payable only upon
presentation and surrender of this Tranche A-3 Rate Stabilization Bond and
shall specify the place where this Tranche A-3 Rate Stabilization Bond may be
presented and surrendered for payment of such installment.

 

The Issuer shall pay interest on overdue installments
of interest at the Rate Stabilization Bond Interest Rate to the extent lawful.

 

This Rate Stabilization Bond is a “Rate Stabilization
Bond” as such term is defined in the Rate Stabilization Law.  Principal and interest due and payable on
this Rate 

 

2

 

Stabilization Bond are payable from and secured
primarily by Rate Stabilization Property created and established by a Qualified
Rate Order obtained from the Public Service Commission of Maryland pursuant to
the Rate Stabilization Law.  Rate
Stabilization Property consists of the rights and interests of the Seller in
the relevant Qualified Rate Order, including the right to impose, collect and
recover certain charges (defined in the Rate Stabilization Law as “Qualified
Rate Stabilization Charges”) to be included in regular electric utility
bills of existing and future residential electric delivery service customers
within the service territory of BGE, a Maryland electric utility, or its
successors or assigns, as more fully described in the Qualified Rate Order.

 

The Rate Stabilization Law provides that:  “The state pledges for the benefit and
protection of financing parties and the electric company, that it will not take
or allow any action that would impair the value of rate stabilization property,
or, except as allowed in accordance with Sections 7-531, 7-533, and 7-534 [of
the Rate Stabilization Law], reduce, alter, or impair the qualified rate stabilization
charges to be imposed, collected, and remitted to financing parties, until the
principal, interest and premium, and any other charges incurred and contracts
to be performed in connection with the related rate stabilization bonds have
been paid and performed in full.  Any
party issuing rate stabilization bonds is authorized to include this pledge in
any documentation relating to those bonds.”

 

As a result of the foregoing pledge, the State of
Maryland may not, except as provided in the succeeding sentence, in any way
reduce, alter or impair the Qualified Rate Stabilization Charges until the Rate
Stabilization Bonds, together with interest thereon, are fully paid and
discharged.  Notwithstanding the
immediately preceding sentence, the State of Maryland would be allowed to
effect a temporary impairment of the Holders’ rights if it could be shown that
such impairment was necessary to advance a significant and legitimate public
purpose.

 

The Issuer and BGE hereby acknowledge that the
purchase of this Rate Stabilization Bond by the Holder hereof or the purchase
of any beneficial interest herein by any Person are made in reliance on the
foregoing pledge.

 

As provided in the Indenture and subject to certain
limitations set forth therein, the transfer of this Tranche A-3 Rate
Stabilization Bond may be registered on the Rate Stabilization Bond Register
upon surrender of this Tranche A-3 Rate Stabilization Bond for registration of
transfer at the office or agency designated by the Issuer pursuant to the
Indenture, duly endorsed by, or accompanied by (a) a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by the
Holder hereof or such Holder’s attorney duly authorized in writing, with such
signature guaranteed by an institution which is a member of one of the
following recognized Signature Guaranty Programs:  (i) The Securities Transfer Agent
Medallion Program (STAMP); (ii)The New York Stock Exchange Medallion Program
(MSP); (iii) The Stock Exchange Medallion Program (SEMP); or (iv) in
such other guarantee program acceptable to the Indenture Trustee, and (b) such
other documents as the Indenture Trustee may require, and thereupon one or more
new Tranche A-3 Rate Stabilization Bonds of Minimum Denominations and in the
same aggregate principal amount will be issued to the designated transferee or
transferees.  No service charge will be
charged for any registration of transfer or exchange of this Tranche A-3 Rate
Stabilization Bond, but the 

 

3

 

transferor may be required to pay a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any such registration of transfer or exchange, other than exchanges
pursuant to Sections 2.04 or 2.06 of the Indenture not involving
any transfer.

 

Each Rate Stabilization Bond holder, by acceptance of
a Rate Stabilization Bond, covenants and agrees that no recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer or the
Indenture Trustee on the Rate Stabilization Bonds or under the Indenture or any
certificate or other writing delivered in connection therewith, against (i) the
Indenture Trustee or the Managers in their respective individual capacities, (ii) any
owner of a limited liability company interest in the Issuer (including BGE) or (iii) any
shareholder, partner, owner, beneficiary, agent, officer or employee of the
Indenture Trustee, the Managers or any owner of a limited liability company
interest in the Issuer (including BGE) in its respective individual or
corporate capacities, or of any successor or assign of any of them in their
individual or corporate capacities, except as any such Person may have
expressly agreed in writing (it being understood that none of the Indenture
Trustee, the Managers or BGE has any such obligations in their respective
individual or corporate capacities).

 

Prior to the due presentment for registration of
transfer of this Tranche A-3 Rate Stabilization Bond, the Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee may treat the
Person in whose name this Tranche A-3 Rate Stabilization Bond is registered (as
of the day of determination) as the owner hereof for the purpose of receiving
payments of principal of and premium, if any, and interest on this Tranche A-3
Rate Stabilization Bond and for all other purposes whatsoever, whether or not
this Tranche A-3 Rate Stabilization Bond be overdue, and neither the Issuer,
the Indenture Trustee nor any such agent shall be affected by notice to the
contrary.

 

The Indenture permits, with certain exceptions as
therein provided, the amendment thereof and the modification of the rights and
obligations of the Issuer and the rights of the Holders of the Rate
Stabilization Bonds under the Indenture at any time by the Issuer with the
consent of the Bondholders representing not less than a majority of the
Outstanding Amount of all Rate Stabilization Bonds at the time outstanding of
each Series or Tranche to be affected. 
The Indenture also contains provisions permitting the Bondholders
representing specified percentages of the Outstanding Amount of the Rate
Stabilization Bonds of all Series, on behalf of the Holders of all the Rate
Stabilization Bonds, to waive compliance by the Issuer with certain provisions
of the Indenture and certain past defaults under the Indenture and their
consequences.  Any such consent or waiver
by the Holder of this Tranche A-3 Rate Stabilization Bond (or any one of more Predecessor
Rate Stabilization Bonds) shall be conclusive and binding upon such Holder and
upon all future Holders of this Tranche A-3 Rate Stabilization Bond and of any
Rate Stabilization Bond issued upon the registration of transfer hereof or in
exchange hereof or in lieu hereof whether or not notation of such consent or
waiver is made upon this Tranche A-3 Rate Stabilization Bond.  The Indenture also permits the Indenture
Trustee to amend or waive certain terms and conditions set forth in the
Indenture without the consent of Holders of the Rate Stabilization Bonds issued
thereunder.

 

The Indenture contains provisions for defeasance at
any time of (a) the entire indebtedness of the Issuer on this Tranche A-3
Rate Stabilization Bond and (b) certain 

 

4

 

restrictive covenants and the related Events of
Default, upon compliance by the Issuer with certain conditions set forth
therein, which provisions apply to this Tranche A-3 Rate Stabilization Bond.

 

The term “Issuer” as used in this Tranche A-3 Rate Stabilization
Bond includes any successor to the Issuer under the Indenture.

 

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

 

The Tranche A-3 Rate Stabilization Bonds are issuable
only in registered form in denominations as provided in the Indenture and the
related Series Supplement subject to certain limitations therein set
forth.

 

THIS TRANCHE A-3 RATE STABILIZATION BOND, THE
INDENTURE AND THE RELATED SERIES SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF
LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS; PROVIDED
THAT THE CREATION, ATTACHMENT AND PERFECTION OF ANY LIENS CREATED UNDER THE
INDENTURE IN RATE STABILIZATION PROPERTY, AND ALL RIGHTS AND REMEDIES OF THE
INDENTURE TRUSTEE AND THE HOLDERS WITH RESPECT TO SUCH RATE STABILIZATION
PROPERTY, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND.

 

No reference herein to the Indenture and no provision
of this Tranche A-3 Rate Stabilization Bond or of the Indenture shall alter or
impair the obligation, which is absolute and unconditional, to pay the
principal of and interest on this Tranche A-3 Rate Stabilization Bond at the
times, place, and rate, and in the coin or currency herein prescribed.

 

The Holder of this Tranche A-3 Rate Stabilization Bond
by the acceptance hereof agrees that, notwithstanding any provision of the
Indenture or the related Series Supplement to the contrary, the Holder
shall have no recourse against the Issuer, but shall look only to the Rate
Stabilization Bond Collateral, with respect to any amounts due to the Holder
under this Tranche A-3 Rate Stabilization Bond.

 

The Issuer and the Indenture Trustee, by entering into
the Indenture, and the Holders and any Persons holding a beneficial interest in
any Tranche A-3 Rate Stabilization Bond, by acquiring any Tranche A-3 Rate
Stabilization Bond or interest therein, (i) express their intention that,
solely for the purpose of federal taxes and, to the extent consistent with applicable
state, local and other tax law, solely for the purpose of state, local and
other taxes, the Tranche A-3 Rate Stabilization Bonds qualify under applicable
tax law as indebtedness of the sole owner of the Issuer secured by the Rate
Stabilization Bond Collateral and (ii) solely for purposes of federal
taxes and, to the extent consistent with applicable state, local and other tax
law, solely for purposes of state, local and other 

 

5

 

taxes, so long as any of the Tranche A-3 Rate
Stabilization Bonds are outstanding, agree to treat the Tranche A-3 Rate
Stabilization Bonds as indebtedness of the sole owner of the Issuer secured by
the Rate Stabilization Bond Collateral unless otherwise required by appropriate
taxing authorities.

 

6

 

ABBREVIATIONS

 

The following abbreviations, when used in the
inscription of the face of this Tranche A-3 Rate Stabilization Bond, shall be
construed as though they were written out in full according to applicable laws
or regulations.

 

	
  TEN COM

  	
  as tenants in common

  
	
   

  	
   

  
	
  TEN ENT

  	
  as tenants by the
  entireties

  
	
   

  	
   

  
	
  JT TEN

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

  
	
   

  	
   

  
	
  UNIF GIFT MIN ACT

  	
   

  	
  Custodian

  	
   

  
	
   

  	
  (Custodian)

  	
   

  	
  (minor)

  
	
   

  	
  Under Uniform
  Gifts to Minor Act   (

  	
   

  	
  )

  
	
   

  	
   

  	
  (State)

  	
   

  
						

 

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

 

 

ASSIGNMENT

 

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

 

FOR VALUE RECEIVED, the undersigned(3) hereby
sells, assigns and transfers unto

 

(name and address of assignee)

 

the
within Tranche A-3 Rate Stabilization Bond and all rights thereunder, and
hereby irrevocably constitutes and appoints                           ,
attorney, to transfer said Tranche A-3 Rate Stabilization Bond on the books
kept for registration thereof, with full power of substitution in the premises.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature Guaranteed:

  

 

(3)           RATE STABILIZATION BOND:  The signature to this assignment must
correspond with the name of the registered owner as it appears on the face of
the within Tranche A-3 Rate Stabilization Bond in every particular, without
alteration, enlargement or any change whatsoever.

 

NOTE:  Signature(s) must be guaranteed by an
institution which is a member of one of the following recognized Signature
Guaranty Programs:  (i) The
Securities Transfer Agent Medallion Program (STAMP), (ii) The New York
Stock Exchange Medallion Program (MSP), (iii) the Stock Exchange Medallion
Program (SEMP) or (iv) such other guarantee program acceptable to the
Indenture Trustee.

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