Document:

Manas Petroleum Corporation: Exhibit 10.2 - Filed by newsfilecorp.com

	MANAS PETROLEUM CORPORATION 
	NONSTATUTORY STOCK OPTION AGREEMENT 
	(Investor Relations) 
	 

THIS NONSTATUTORY STOCK OPTION AGREEMENT
(“Agreement”) is made and entered into as of the date set forth
below, by and between MANAS PETROLEUM CORPORATION, a Nevada corporation
(the “Company”), and the following consultant of the Company (herein,
“Optionee”):

In consideration of the covenants herein set forth, the parties
hereto agree as follows:

1. Option Information.

	 	(a) 	Date of Option: 	June 26, 2013 
	 	(b) 	Optionee: 	Undiscovered Equities Inc. 
	 	(c) 	Number of Shares: 	250,000 (the “First Option Shares”)
  
	 	(d) 	Exercise Price: 	US$0.15 per Share 
	 	(e) 	Number of Shares: 	250,000 (the “Second Option Shares”)
  
	 	(f) 	Exercise Price: 	US$0.30 per Share 
	 	(g) 	Number of Shares: 	250,000 (the “Third Option Shares”)
  
	 	(h) 	Exercise Price: 	US$0.45 per Share 

2. Acknowledgements.

	 	(a) 	
      Optionee is providing investor relations services (the
      “Services”) to the Company pursuant to a written Consulting
      Agreement dated effective June 18, 2013 (the “Agreement”); and

	 	 	 
	 	(b) 	
      As an inducement to Optionee and pursuant to the
      Agreement, the Board has authorized the granting to Optionee of stock
      options (the “Options”) to purchase shares of common stock of the
      Company (“Common Shares”) upon the terms and conditions hereinafter
      stated.

3. Shares; Price.

3.1 Subject to the acceptance of the Agreement by the TSX
Venture Exchange and such other regulatory authorities having jurisdiction, the
Company hereby grants to Optionee the non-transferable right to purchase, upon
and subject to the terms and conditions herein stated, the number of Common Shares set forth in Section 1(c), (e), (g)
above (the “Shares”) for cash at the price per Share set forth in Section
1(d), (f), (h), respectively, above (the “Exercise Price”).

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4. Stock Option Plan

4.1 The terms of the Option will be subject to the 2011 stock
option plan (the “Plan”) of the Company, as may from time to time be
amended, and any inconsistencies between this Agreement and the Plan, as the
same may be from time to time amended, shall be governed by the provisions of
the Plan. Upon a written request to the Company, the Company shall deliver a
copy of the Plan to the Optionee.

5. Term of Option.

5.1 This Option shall expire, and all rights hereunder to
purchase the Shares shall terminate, five (5) years from the date hereof or, if
earlier, upon the date and for the reasons specified in Sections 8 and 13 below.
Nothing contained herein shall be construed to interfere in any way with the
right of the Company to terminate the relationship between it and Optionee, or
to increase or decrease the compensation paid to Optionee, if any, from the rate
in effect as of the date hereof.

6. Vesting of Option.

6.1 Subject to the provisions of Sections 8 and 13 hereof,
these Options shall become exercisable in four instalments over a period of
twelve months, with the first instalment of 187,500 Shares (consisting of 62,500
First Option Shares, 62,500 Second Option Shares and 62,500 Third Option Shares)
vesting August 27, 2013, the second instalment of 187,500 Shares (consisting of
62,500 First Option Shares, 62,500 Second Option Shares and 62,500 Third Option
Shares) vesting November 27, 2013, the third instalment of 187,500 shares
(consisting of 62,500 First Option Shares, 62,500 Second Option Shares and
62,500 Third Option Shares) vesting February 27, 2014 and the fourth installment
of 187,500 shares (consisting of 62,500 First Option Shares, 62,500 Second
Option Shares and 62,500 Third Option Shares) vesting May 27, 2014. The
instalments shall be cumulative (i.e., this Option may be exercised, as to any
or all Shares covered by an instalment, at any time or times after an instalment
becomes exercisable and until expiration or termination of this Option).

7. Exercise.

7.1 This Option shall be exercised by delivery to the Company
of:

	 	(a) 	
      written notice of exercise stating the number of Shares
      being purchased (in whole shares only) and such other information set
      forth on the form of Notice of Exercise attached hereto as Appendix
    A;

	 	 	 
	 	(b) 	
      a cashier’s cheque, bank draft, wire transfer (pursuant
      to wire transfer instructions that will be supplied by the Company upon
      request) or cash in the amount of the Exercise Price of the Shares covered
      by the notice; and

	 	 	 
	 	(c) 	
      a written investment representation as provided for in
      Section 13 hereof.

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Except as otherwise expressly permitted in Section 8, below,
this Option shall not be assignable or transferable and may be exercised
only by Optionee.

8. Death of Optionee.

8.1 If Optionee shall die while serving as a consultant of the
Company, Optionee’s personal representative or the person entitled to Optionee’s
rights hereunder may at any time within thirty (30) days after the date of
Optionee’s death, or during the remaining term of this Option, whichever is the
lesser, exercise this Option and purchase Shares to the extent, but only to the
extent, that Optionee could have exercised this Option as of the date of
Optionee’s death; provided, in any case, that this Option may be so exercised
only to the extent that this Option has not previously been exercised by
Optionee.

9. No Rights as Shareholder.

9.1 Optionee shall have no rights as a shareholder with respect
to the Shares covered by any instalment of this Option until the effective date
of the issuance of Shares following exercise of this Option, and no adjustment
will be made for dividends or other rights for which the record date is prior to
the date such stock certificate or certificates are issued except as provided in
Section 10 hereof.

10. Recapitalization.

10.1 Subject to any required action by the shareholders of the
Company, the number of Shares covered by this Option, and the Exercise Price
thereof, shall be proportionately adjusted for any increase or decrease in the
number of issued Common Shares resulting from a subdivision or consolidation of
Common Shares or the payment of a stock dividend, or any other increase or
decrease in the number of such Common Shares effected without receipt of
consideration by the Company; provided however that the conversion of any
convertible securities of the Company shall not be deemed having been “effected
without receipt of consideration by the Company.”

10.2 In the event of a proposed dissolution or liquidation of
the Company, a merger or consolidation in which the Company is not the surviving
entity, or a sale of all or substantially all of the assets or capital stock of
the Company (collectively, a “Reorganization”), this Option shall
terminate immediately prior to the consummation of such proposed action, unless
otherwise provided by the Board; provided, however, if Optionee shall be a
consultant of the Company at the time such Reorganization is approved by the
stockholders, Optionee shall have the right to exercise this Option as to all or
any part of the Shares, without regard to the instalment provisions of Section
6, for a period beginning 30 days prior to the consummation of such
Reorganization and ending as of the Reorganization or the expiration of this
Option, whichever is earlier, subject to the consummation of the Reorganization.
In any event, the Company shall notify Optionee, at least 30 days prior to the
consummation of such Reorganization, of his exercise rights, if any, and that
the Option shall terminate upon the consummation of the Reorganization.

10.3 Subject to any required action by the shareholders of the
Company, if the Company shall be the surviving entity in any merger or
consolidation, this Option thereafter shall pertain to and apply to the
securities to which a holder of Common Shares equal to the Shares subject to
this Option would have been entitled by reason of such merger or
consolidation, and the instalment provisions of Section 6 shall continue to
apply.

- 4 -

10.4 In the event of a change in the Common Shares of the
Company as presently constituted, which is limited to a change of all of its
authorized Common Shares without par value into the same number of Common Shares
with a par value, the shares resulting from any such change shall be deemed to
be the Shares within the meaning of this Option.

10.5 To the extent that the foregoing adjustments relate to
Common Shares or securities of the Company, such adjustments shall be made by
the Board, whose determination in that respect shall be final, binding and
conclusive. Except as hereinbefore expressly provided, Optionee shall have no
rights by reason of any subdivision or consolidation of Common Shares of any
class or the payment of any stock dividend or any other increase or decrease in
the number of shares of stock of any class, and the number and price of Shares
subject to this Option shall not be affected by, and no adjustments shall be
made by reason of, any dissolution, liquidation, merger, consolidation or sale
of assets or capital stock, or any issue by the Company of shares of stock of
any class or securities convertible into shares of stock of any class.

10.6 The grant of this Option shall not affect in any way the
right or power of the Company to make adjustments, reclassifications,
reorganizations or changes in its capital or business structure or to merge,
consolidate, dissolve or liquidate or to sell or transfer all or any part of its
business or assets.

11. Taxation upon Exercise of Option.

11.1 Optionee understands that, upon exercise of this Option,
Optionee may, depending on applicable tax laws in the jurisdiction where
Optionee is liable for the payment of income taxes, recognize income, for income
tax purposes, in an amount equal to the amount by which the fair market value of
the Shares, determined as of the date of exercise, exceeds the Exercise Price.
The acceptance of the Shares by Optionee shall constitute an agreement by
Optionee to report such income in accordance with then applicable law and to
cooperate with the Company in establishing the amount of such income and
corresponding deduction to the Company for its income tax purposes. Withholding
for federal or state income and employment tax purposes will be made, if and as
required by law, from Optionee’s then current compensation, or, if such current
compensation is insufficient to satisfy withholding tax liability, the Company
may require Optionee to make a cash payment to cover such liability as a
condition of the exercise of this Option.

12. Modification, Extension and Renewal of Options.

12.1 The Board may modify, extend or renew this Option or
accept the surrender thereof (to the extent not theretofore exercised) and
authorize the granting of a new option in substitution therefor (to the extent
not theretofore exercised), subject at all times to the applicable rules of any
regulatory authority or stock exchange, and any applicable laws. Notwithstanding
the foregoing provisions of this Section 12, no modification shall, without the
consent of Optionee, materially alter to Optionee’s detriment or materially
impair any rights of Optionee hereunder.

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13. TSX Venture Exchange

 If and for so long as any of the Company’s securities are
listed for trading on the TSX Venture Exchange (the “TSXV”), the
provisions of this Section 13 will apply to this Agreement and to any Options
granted hereunder. To the extent that the provisions of this Section are
inconsistent with the provisions found in the other Sections of this Agreement,
the provisions of this Section will prevail.

	 	13.1 	
      The term “consultant”, “consultant company” and
      “management company employee” will have the meanings as defined in the
      applicable policy of the TSXV. As a condition precedent to the issuance of
      an Option, the Company must be able to represent to the TSXV as of the
      grant date that Optionee is a bona fide consultant or management
      company employee, as the case may be.

	 	 	 	 
	 	13.2 	
      The exercise price of an Option must be paid in
    cash.

	 	 	 	 
	 	13.3 	
      Options and Shares will be subject to all applicable
      trading restrictions in effect pursuant to TSXV policies and the Company
      shall be entitled to legend any Option certificates and the certificates
      representing Shares issued upon exercise of Options accordingly, including
      TSXV legends, as applicable.

	 	 	 	 
	 	13.4 	
      In the event of Optionee’s death, any Options held by
      Optionee shall pass to the personal representative (being the executor or
      administrator of the deceased option holder, duly appointed by a court or
      public authority having jurisdiction to do so) of Optionee and shall be
      exercisable by the personal representative on or before the date which is
      the earlier of twelve months following the date of death and the
      applicable expiry date.

	 	 	 	 
	 	13.5 	
      Options granted hereunder shall expire on the date that
      is 30 days after the arrangement with Optionee to provide services expires
      or is terminated.

	 	 	 	 
	 	13.6 	
      The Company shall establish, and Optionee shall comply
      with, procedures to monitor any trading in Common Shares of the Company by
      Optionee or any of Optionee’s affiliates or associates (as those terms are
      defined by the TSXV). By way of example, these procedures may include the
      establishment of a designated brokerage account through with Optionee and
      its affiliates or associates conduct all trades in Common Shares of the
      Company, or the requirement that these persons file insider trading
      reports with the Company.

	 	 	 	 
	 	13.7 	
      The Options granted hereunder are subject to approval by
      a majority of the Company’s disinterested shareholders at a meeting of the
      shareholders if this Agreement would result at any time in:

	 	 	 	 
	 		i. 	
      the number of Common Shares reserved for issuance
      pursuant to all stock options granted to “Insiders” (as that term is
      defined under applicable law), including those granted pursuant to this
      Agreement, exceeding ten percent (10%) of the issued and outstanding
      Common Shares of the Company; or

- 6 -

	 	ii. 	
      the grant to Insiders, within a 12 month period, of a
      number of options, including those granted pursuant to this Agreement,
      exceeding ten percent (10%) of the issued and outstanding Common Shares of
      the Company; or

	 	 	 
	 	iii. 	
      the issuance to any one person, including Optionee,
      within a 12 month year period, of a number of Common Shares exceeding five
      percent (5%) of the issued and outstanding Common Shares of the
      Company.

13.8 If Optionee is not an individual, Optionee shall complete
and file with TSXV a Certification and Undertaking Required from a Company
Granted an Incentive Stock Option (Form 4F), as described in Sections 2.5
and 4.2 of TSXV Policy 4.4 as in effect on the date of this Agreement and as the
same may be amended from time-to-time.

13.9 Optionee shall complete and file a Personal Information
Form (Form 2A) or, if applicable, a Statutory Declaration (Form 2C1)
with TSXV.

14. Representations and Warranties

14.1 Optionee authorizes the Company to represent and warrant
to the TSXV that Optionee is a “consultant” of the Company (as that term is
defined in Section 1.2 of TSXV Policy 4.4 as is in effect on the date of this
Agreement and as the same may be amended from time-to-time).

14.2 If on the date of this Agreement or on the date of
exercise of any of the Options granted hereunder, Optionee is a U.S. Person (as
defined in Rule 902 of Regulation S, promulgated by the Securities and Exchange
Commission) or is physically located in the United States, Optionee represents
and agrees that:

	 	(a) 	
      if and when Optionee exercises this Option in whole or in
      part, Optionee will in each case acquire the Shares upon such exercise for
      the purpose of investment and not with a view to, or for resale in
      connection with, any distribution thereof; and that upon such exercise of
      this Option in whole or in part, Optionee (or any person or persons
      entitled to exercise this Option under the provisions of Section 8 hereof)
      shall furnish to the Company a written statement to such effect,
      satisfactory to the Company in form and substance. If the Shares
      represented by this Option are registered under the Securities Act of
      1933, as amended (the “Securities Act”) either before or after
      the exercise of this Option in whole or in part, Optionee shall be
      relieved of the foregoing investment representation and agreement and
      shall not be required to furnish the Company with the foregoing written
      statement;

	 	 	 
	 	(b) 	
      that Optionee has had access to the financial statements
      of the Company, has had the opportunity to ask questions of the Company
      concerning its business, operations and financial condition, and to obtain
      additional information reasonably necessary to verify the accuracy of such
      information (collectively, the “Company Information”). Optionee
      understands that all of the Company Information is available for
      Optionee’s review on both the EDGAR database maintained by the Securities
      and Exchange Commission (as www.sec.gov) and the SEDAR database maintained by the Canadian Securities
  Administrators (at www.sedar.com);

- 7 -

	 	(c) 	
      that Optionee has sufficient education and experience as
      will enable Optionee to review and understand the Company Information and
      is able to assess the merits and the risks of an investment in the Company
      and its business; and

	 	 	 
	 	(d) 	
      that all information contained in the Questionnaire is
      complete and accurate and Optionee understands and agrees that the Company
      and others will rely upon the truth and accuracy of the acknowledgements,
      representations and agreements contained in this Agreement and the
      Questionnaire, and agrees that if any of such acknowledgements,
      representations and agreements are no longer accurate or have been
      breached, Optionee shall promptly notify the
Company.

14.3 The securities deliverable upon exercise of this Option
may be subject to restrictions on resale under applicable securities laws and
the policies of any stock exchange or market on which the Company’s securities
may be traded or listed for quotation from time-to-time. Optionee agrees that
the Company may take such steps as the Company deems reasonably necessary to
comply with applicable law and the requirements of any stock exchange and,
promptly after receipt of any request from the Company, acting reasonably,
Optionee shall cooperate with the Company in providing information to regulatory
authorities, filing required reports and similar compliance efforts.

14.4 Unless and until the Shares represented by this Option are
registered under the Securities Act, all certificates representing the Shares
and any certificates subsequently issued in substitution therefor and any
certificate for any securities issued pursuant to any stock split, share
reclassification, stock dividend or other similar capital event shall bear
legends in substantially the following form:

THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR THE UNITED STATES SECURITIES COMMISSION OF
ANY STATE AND HAVE BEEN ISSUED IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND,
ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE
SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS INVOLVING THE SECURITIES MAY
NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.

and/or such other legend or legends as the Company and its
counsel deem necessary or appropriate including, where applicable, any legend
required by the Canadian securities laws or any stock exchange on which
securities of the Company are traded. Appropriate stop transfer instructions
with respect to the Shares have been placed with the Company’s transfer
agent.

- 8 -

15. Stand-off Agreement.

15.1 Optionee agrees that, in connection with any registration
of the Company’s securities under the Securities Act, and upon the request of
the Company or any underwriter managing in an underwritten offering of the
Company’s securities, Optionee shall not sell, short any sale of, loan, grant an
option for, or otherwise dispose of any of the Shares (other than Shares
included in the offering) without the prior written consent of the Company or
such managing underwriter, as applicable, for a period of at least one year
following the effective date of registration of such offering.

16. Notices.

16.1 Any notice required to be given pursuant to this Option
shall be in writing and shall be deemed to be delivered upon receipt or, in the
case of notices by the Company, five (5) days after deposit in the mail, postage
prepaid, addressed to Optionee at the address last provided by Optionee to the
Company.

17. Independent Legal Advice

17.1 Optionee acknowledges that:

	 	(a) 	
      this Agreement was prepared by Clark Wilson LLP who is
      solely representing the Company;

	 	 	 
	 	(b) 	
      Clark Wilson LLP received instructions from the Company
      and does not represent Optionee;

	 	 	 
	 	(c) 	
      Optionee has been requested to obtain his own independent
      legal advice. including tax advice;

	 	 	 
	 	(d) 	
      Optionee has been given adequate time to obtain
      independent legal advice;

	 	 	 
	 	(e) 	
      by signing this Agreement, Optionee confirms that he
      fully understands this Agreement; and

	 	 	 
	 	(f) 	
      by signing this Agreement without first obtaining
      independent legal advice, Optionee waives his right to obtain legal
      advice.

18. Applicable Law.

18.1 The interpretation and enforcement of this Option
Agreement and any questions with respect to the validity of any Options granted
hereunder shall be governed by the laws of the State of Nevada and, to the
extent applicable, the federal laws of the United States and the securities laws
of any state or province of the United States or Canada having jurisdiction over
the Company.

- 9 -

[SIGNATURE PAGE FOLLOWS.]

- 10 -

IN WITNESS WHEREOF, the parties hereto have executed
this Option as of the date first above written.

	COMPANY: 	MANAS PETROLEUM CORPORATION, 
	  	a Nevada corporation 
	  	  	 
	  	  	 
	  	By: 	 
	  	Name: 	 
	  	Title: 	 
	  	  	 
	OPTIONEE: 	UNDISCOVERED EQUITIES INC., 
	  	a Florida corporation 
	  	  	 
	  	  	 
	  	By: 	 
	  	Name: 	 
	  	Title: 	 

APPENDIX A

NOTICE OF EXERCISE

MANAS PETROLEUM CORPORATION

Re: Nonstatutory Stock Option

Notice is hereby given pursuant to Section 7 of my Nonstatutory
Stock Option Agreement that I elect to purchase the number of shares set forth
below at the exercise price set forth in my option agreement:

Nonstatutory Stock Option Agreement
dated: ________________

Number of shares being purchased:
________________

Exercise Price: $________________

A check in the amount of the aggregate
price of the shares being purchased is attached.

I hereby confirm that such shares (the “Option Shares”)
are being acquired by me for my own account for investment purposes, and not
with a view to, or for resale in connection with, any distribution thereof. I
will not sell or dispose of my Shares in violation of the Securities Act of
1933, as amended, or any applicable federal, state or provincial securities
laws.

I represent that, at the time of exercise of my Stock Option,
all of the representations and warranties contained in my Stock Option
Agreement, and any certificates, questionnaires, or other instruments attached
thereto, are true and accurate.

I understand that the certificate representing the Option
Shares will bear a restrictive legend within the contemplation of the Securities
Act and as required by such other state, provincial or federal law or regulation
applicable to the issuance or delivery of the Option Shares.

I agree to provide to the Company such additional documents or
information as may be required pursuant to my Stock Option Agreement.

	 	By: 	
	 	 	(signature) 
	 	 	  
	 	Name: 	

APPENDIX B

ACCREDITED INVESTOR QUESTIONNAIRE

(TO BE COMPLETED IF OPTIONEE IS A U.S. PERSON AT THE DATE OF
GRANT OR 
AT THE DATE OF EXERCISE OF THE OPTIONS)

All capitalized terms herein, unless otherwise defined, have
the meanings ascribed thereto in the Stock Option Agreement.

Optionee covenants, represents and warrants to the Company that
he satisfies one or more of the categories of “Accredited Investors”, as defined
by Regulation D promulgated under the Securities Act, as indicated below:
(Please initial in the space provide those categories, if any, of an “Accredited
Investor” which Optionee satisfies)

		_____	Category 1 	
      An organization described in Section 501(c)(3) of the
      United States Internal Revenue Code, a corporation, a Massachusetts or
      similar business trust or partnership, not formed for the specific purpose
      of acquiring the Units, with total assets in excess of US $5,000,000;
    

	 	 	  	
       

		_____	Category 2 	
      A natural person whose individual net worth, or joint net
      worth with that person’s spouse, on the date of purchase exceeds US
      $1,000,000; 

	 	 	  	
       

		_____	Category 3 	
      a natural person whose individual net worth, or joint net
      worth with that person’s spouse, at the time of purchase exceeds US
      $1,000,000, calculated by (i) not including the person’s primary residence
      as an asset; (ii) not including indebtedness that is secured by the
      person's primary residence, up to the estimated fair market value of the
      primary residence at the time of the sale of the Securities as a liability
      (except that if the amount of such indebtedness outstanding at the time of
      the sale of Securities exceeds the amount outstanding 60 days before such
      time, other than as a result of the acquisition of the primary residence,
      the amount of such excess shall be included as a liability); and (iii)
      including indebtedness that is secured by the person's primary residence
      in excess of the estimated fair market value of the primary residence at
      the time of the sale of the Securities as a liability; 

	 	 	  	
       

		_____	Category 4 	
      A “bank” as defined under Section (3)(a)(2) of the
      Securities Act or savings and loan association or other institution as
      defined in Section 3(a)(5)(A) of the Securities Act acting in its
      individual or fiduciary capacity; a broker dealer registered pursuant to
      Section 15 of the Securities Exchange Act of 1934 (United States);
      an insurance company as defined in Section 2(13) of the Securities Act; an
      investment company registered under the Investment Company Act of
      1940 (United States) or a business development company as defined in
      Section 2(a)(48) of such Act; a Small Business Investment Company licensed
      by the U.S. Small Business Administration under Section 301(c) or (d) of
      the Small Business Investment Act of 1958 (United States); a
      plan with total assets in excess of $5,000,000 established and maintained
      by a state, a political subdivision thereof, or an agency or
      instrumentality of a state or a political subdivision thereof, for the
      benefit of its employees; an employee benefit plan within the meaning of
      the Employee Retirement Income Security Act of 1974 (United States)
      whose investment decisions are made by a plan fiduciary, as defined in
      Section 3(21) of such Act, which is either a bank, savings and loan
      association, insurance company or registered investment adviser, or if the
      employee benefit plan has total assets in excess of $5,000,000, or, if a
      self-directed plan, whose investment decisions are made solely
  by persons that are accredited investors; 

- 2 -

		_____	Category 5 	
      A private business development company as defined in
      Section 202(a)(22) of the Investment Advisers Act of 1940 (United
      States); 

	 	 	  	
      

	 	_____	Category 6 	
  A director or executive officer of the Company;

	 	 	  	
      

		_____	Category 7 	
      A trust with total assets in excess of $5,000,000, not
      formed for the specific purpose of acquiring the Securities, whose
      purchase is directed by a sophisticated person as described in Rule
      506(b)(2)(ii) under the Securities Act; 

	 	 	  	
      

		_____	Category 8 	
      An entity in which all of the equity owners satisfy the
requirements of one or more of the foregoing categories;

Optionee hereby certifies that the information contained in
this Questionnaire is complete and accurate and Optionee will notify the Company
promptly of any change in any such information.

IN WITNESS WHEREOF, the undersigned has executed this
Questionnaire as of the _______ day of __________________, 20__.

	 	X
  
	 	Signature 
	 	 
	 	 
	 	Print or Type Name 
	 	 
	 	 
	 	Social Security/Tax I.D. No.Exhibit 4.1

 

 

 

SIXTY-SIXTH SUPPLEMENTAL

INDENTURE

 

TO

 

INDENTURE DATED SEPTEMBER 1, 1939

 

 

DUKE ENERGY INDIANA, INC.

 

TO

 

DEUTSCHE BANK NATIONAL TRUST COMPANY

AS TRUSTEE

 

 

DATED AS OF JULY 11, 2013

 

 

CREATING

FIRST MORTGAGE BONDS, SERIES VVV, FLOATING RATE, DUE JULY 11, 2016,

AND

FIRST MORTGAGE BONDS, SERIES WWW, 4.90%, DUE JULY 15, 2043

 

AND

 

OTHERWISE SUPPLEMENTING AND AMENDING THE INDENTURE

 

 

 

 

TABLE OF CONTENTS

 

 

	
 
    	
Page
    
	
 
    	
 
    
	
PARTIES:
    	
 
    
	
Company (Duke Energy   Indiana, Inc., formerly named each of PSI Energy, Inc. and Public   Service Company of Indiana, Inc., and successor by consolidation to   Initial Mortgagor (Public Service Company of Indiana)), and Trustee
    	
1
    
	
 
    	
 
    
	
RECITALS:
    	
 
    
	
Indenture of the Initial Mortgagor, dated   September 1, 1939, and First Supplemental Indenture thereto of the   Initial Mortgagor, dated as of March 1, 1941
    	
1
    
	
Consolidation of Initial Mortgagor (and four other   companies) into the Company
    	
1
    
	
Execution by Company of Second Supplemental   Indenture to the original Indenture
    	
1
    
	
Company substituted for Initial Mortgagor under   Indenture
    	
1
    
	
Execution by Company of Third through the   Sixty-Fifth Supplemental Indentures to the original Indenture
    	
2
    
	
LaSalle Bank National Association appointed as   Successor Trustee
    	
3
    
	
Resignation of Bank of America, N.A., as successor   by merger to LaSalle Bank National Association, and appointment of Deutsche   Bank National Trust Company as Successor Trustee
    	
3
    
	
Change of name of Company from Public Service   Company of Indiana, Inc. to PSI Energy, Inc., and thereafter to Duke   Energy Indiana, Inc.
    	
3
    
	
Amount of bonds presently outstanding under the   Indenture
    	
3
    
	
Sixty-Sixth Supplemental Indenture and Bonds of   Series VVV and Bonds of Series WWW authorized
    	
4
    
	
Conditions precedent performed
    	
4
    
	
 
    	
 
    
	
EXECUTING   CLAUSE
    	
4
    

 

i

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE I.
    
	
 
    
	
FIRST MORTGAGE BONDS,   SERIES VVV, FLOATING RATE, DUE JULY 11, 2016,
    
	
AND
    
	
FIRST MORTGAGE BONDS,   SERIES WWW, 4.90%, DUE JULY 15, 2043.
    
	
 
    	
 
    	
 
    
	
Section 1.
    	
Creation and designation   of Bonds of Series VVV and Bonds of Series WWW
    	
5
    
	
Section 2.
    	
Bonds of each Series to be in registered form only
    	
5
    
	
 
    	
Form of   Face of Bond of Series VVV
    	
9
    
	
 
    	
Form of   Reverse of Bond of Series VVV
    	
11
    
	
 
    	
Form of   Trustee’s Certificate
    	
15
    
	
 
    	
Form of   Face of Bond of Series WWW
    	
16
    
	
 
    	
Form of   Reverse of Bond of Series WWW
    	
18
    
	
 
    	
Form of   Trustee’s Certificate
    	
21
    
	
Section 3.
    	
Date   of Bonds of each Series
    	
22
    
	
Section 4.
    	
Maturity dates, interest rates and payment dates,   and principal payments of Bonds of Series VVV
    	
22
    
	
Section 5.
    	
Maturity dates, interest rates and payment dates,   and principal payments of Bonds of Series WWW
    	
24
    
	
Section 6.
    	
Place   and manner of payment of Bonds of each Series
    	
24
    
	
Section 7.
    	
Denominations and numbering of definitive Bonds of   Series VVV and Bonds of Series WWW
    	
24
    
	
 
    	
Temporary Bonds of Series VVV and Bonds of   Series WWW and exchange thereof for definitive bonds
    	
25
    
	
Section 8.
    	
Maintenance and Renewal Fund shall not apply to   Bonds of Series VVV and Bonds of Series WWW
    	
25
    
	
Section 9.
    	
Inspection requirements shall not apply to Bonds   of Series VVV and Bonds of Series WWW
    	
25
    
	
Section 10.
    	
Company’s   right to further amend the original Indenture
    	
25
    
	
Section 11.
    	
No   sinking fund for Bonds of each Series
    	
26
    
	
 
    	
 
    	
 
    
	
ARTICLE II.
    
	
 
    
	
ISSUANCE OF BONDS OF   SERIES VVV AND BONDS OF SERIES WWW.
    
	
 
    
	
Section 1.
    	
Aggregate principal amount of Bonds of   Series VVV and Bonds of Series WWW issuable at once
    	
27
    
	
Section 2.
    	
Issuance   of additional Bonds of each Series
    	
27
    

 

ii

 

	
 
    	
Page
    
	
 
    	
 
    
	
ARTICLE III.
    
	
 
    
	
CALCULATION   AGENT FOR THE BONDS OF SERIES VVV.
    
	
 
    
	
Section 1.
    	
Appointment   and acceptance
    	
27
    
	
Section 2.
    	
Determination   of interest rates
    	
27
    
	
Section 3.
    	
Terms   and conditions
    	
28
    
	
Section 4.
    	
Qualifications
    	
29
    
	
Section 5.
    	
Resignation   and removal
    	
29
    
	
Section 6.
    	
Successors
    	
30
    
	
Section 7.
    	
Trustee   deemed Calculation Agent under certain circumstances
    	
30
    
	
Section 8.
    	
Merger,   consolidation, sale or transfer
    	
30
    
	
Section 9.
    	
Notice
    	
30
    
	
 
    	
 
    	
 
    
	
ARTICLE IV.
    
	
 
    
	
INDENTURE   AMENDMENTS.
    
	
 
    	
 
    	
 
    
	
Section 1.
    	
Amendments   to Article I of the original Indenture
    	
31
    
	
Section 2.
    	
Amendments   to Article VII of the original Indenture
    	
31
    
	
 
    	
 
    	
 
    
	
ARTICLE V.
    
	
 
    
	
CONCERNING   THE TRUSTEE.
    
	
 
    	
 
    	
 
    
	
Acceptance of trusts by Trustee
    	
33
    
	
Trustee not responsible for validity or   sufficiency of Sixty-Sixth Supplemental Indenture, etc.
    	
33
    
	
Terms and conditions of Article XVII of the   original Indenture to be applied to the Sixty-Sixth Supplemental Indenture
    	
33
    

 

iii

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
ARTICLE VI.
    
	
 
    
	
MISCELLANEOUS   PROVISIONS.
    
	
 
    	
 
    	
 
    
	
Section 1.
    	
References in any article or section of the   original Indenture refer to such article or section as amended by all   Sixty-Six Supplemental Indentures thereto
    	
34
    
	
Section 2.
    	
Operation   and construction of amendments to the original Indenture
    	
34
    
	
Section 3.
    	
All covenants, etc., for sole benefit of   parties to the Sixty-Sixth Supplemental Indenture and holders of bonds
    	
34
    
	
Section 4.
    	
Table   of contents and headings of articles not part of Sixty-Sixth Supplemental   Indenture
    	
34
    
	
Section 5.
    	
Execution   of Sixty-Sixth Supplemental Indenture in counterparts
    	
34
    
	
Section 6.
    	
Payments   due on non-business days
    	
34
    
	
 
    	
 
    
	
ATTESTATION CLAUSE
    	
35
    
	
SIGNATURES
    	
35
    
	
ACKNOWLEDGMENT BY COMPANY
    	
37
    
	
ACKNOWLEDGMENT BY TRUSTEE
    	
38
    

 

iv

 

SIXTY-SIXTH SUPPLEMENTAL INDENTURE dated as of the 11th day of July, 2013, made and entered into by and between DUKE ENERGY INDIANA, INC. (hereinafter commonly referred to as the “Company”), a corporation organized and existing under the laws of the State of Indiana, formerly named each of PSI Energy, Inc. and Public Service Company of Indiana, Inc., and the successor by consolidation to Public Service Company of Indiana, an Indiana corporation, party of the first part, and DEUTSCHE BANK NATIONAL TRUST COMPANY, a national banking association organized and existing under the laws of the United States and having its office or place of business in the City of Chicago, State of Illinois, successor trustee to Bank of America, N.A., as successor by merger to LaSalle Bank National Association, which was the successor trustee to The First National Bank of Chicago (hereinafter commonly referred to as the “Trustee”), party of the second part,

 

WITNESSETH:

 

WHEREAS, Public Service Company of Indiana (hereinafter commonly referred to as the “Initial Mortgagor”), prior to its consolidation with certain other corporations to form the Company, executed and delivered to the Trustee a certain indenture of mortgage or deed of trust (hereinafter called the “original Indenture” when referred to as existing prior to any amendment thereto, and the “Indenture” when referred to as heretofore, now or hereafter amended), dated September 1, 1939, and a First Supplemental Indenture thereto, dated as of March 1, 1941, to secure the bonds of the Initial Mortgagor, its successors and assigns, issued from time to time under the Indenture in series for the purposes of and subject to the limitations specified in the Indenture; and

 

WHEREAS, the Company on September 6, 1941, became, through a consolidation, the successor of the Initial Mortgagor (and four other companies) and succeeded to all the rights and became liable for all the obligations of the Initial Mortgagor (and such other companies); and

 

WHEREAS, after said consolidation, the Company executed and delivered a Second Supplemental Indenture, dated as of November 1, 1941, to the original Indenture for the purposes, among others, of (i) the making by the Company of an agreement of assumption and adoption by it of the Indenture, (ii) the assumption by the Company of the bonds (and interest and premium, if any, thereon) issued or to be issued under the Indenture, and of all terms, covenants and conditions binding upon it under the Indenture, and the agreeing by the Company to pay, perform and fulfill the same, and (iii) the conveying to the Trustee upon the trusts declared in the Indenture, but subject to any outstanding liens and encumbrances, all the property which the Company then owned or which it might thereafter acquire, except property of a character similar to the property of the Initial Mortgagor which is excluded from the lien of the Indenture; and

 

WHEREAS, all conditions have been met and all acts and things necessary have been done and performed to make the Indenture the valid and binding agreement of the Company and to substitute the Company for the Initial Mortgagor under the Indenture, and to vest the Company with each and every right and power of the Initial Mortgagor, including the right and power to issue bonds thereunder; and

 

1

 

WHEREAS, the Company has subsequently executed and delivered, for purposes authorized under the Indenture, a Third Supplemental Indenture dated as of March 1, 1942, a Fourth Supplemental Indenture dated as of May 1, 1943, a Fifth Supplemental Indenture dated as of August 1, 1944, a Sixth Supplemental Indenture dated as of September 1, 1945, a Seventh Supplemental Indenture dated as of November 1, 1947, an Eighth Supplemental Indenture dated as of January 1, 1949, a Ninth Supplemental Indenture dated as of May 1, 1950, a Tenth Supplemental Indenture dated as of July 1, 1952, an Eleventh Supplemental Indenture dated as of January 1, 1954, a Twelfth Supplemental Indenture dated as of October 1, 1957, a Thirteenth Supplemental Indenture dated as of February 1, 1959, a Fourteenth Supplemental Indenture dated as of July 15, 1960, a Fifteenth Supplemental Indenture dated as of June 15, 1964, a Sixteenth Supplemental Indenture dated as of January 1, 1969, a Seventeenth Supplemental Indenture dated as of March 1, 1970, an Eighteenth Supplemental Indenture dated as of January 1, 1971, a Nineteenth Supplemental Indenture dated as of January 1, 1972, a Twentieth Supplemental Indenture dated as of February 1, 1974, a Twenty-First Supplemental Indenture dated as of August 1, 1974, a Twenty-Second Supplemental Indenture dated as of August 1, 1975, a Twenty-Third Supplemental Indenture dated as of January 1, 1977, a Twenty-Fourth Supplemental Indenture dated as of October 1, 1977, a Twenty-Fifth Supplemental Indenture dated as of September 1, 1978, a Twenty-Sixth Supplemental Indenture dated as of September 1, 1978, a Twenty-Seventh Supplemental Indenture dated as of March 1, 1979, a Twenty-Eighth Supplemental Indenture dated as of May 1, 1979, a Twenty-Ninth Supplemental Indenture dated as of March 1, 1980, a Thirtieth Supplemental Indenture dated as of August 1, 1980, a Thirty-First Supplemental Indenture dated as of February 1, 1981, a Thirty-Second Supplemental Indenture dated as of August 1, 1981, a Thirty-Third Supplemental Indenture dated as of December 1, 1981, a Thirty-Fourth Supplemental Indenture dated as of December 1, 1982, a Thirty-Fifth Supplemental Indenture dated as of March 30, 1984, a Thirty-Sixth Supplemental Indenture dated as of November 15, 1984, a Thirty-Seventh Supplemental Indenture dated as of August 15, 1985, a Thirty-Eighth Supplemental Indenture dated as of October 1, 1986, a Thirty-Ninth Supplemental Indenture dated as of March 15, 1987, a Fortieth Supplemental Indenture dated as of June 1, 1987, a Forty-First Supplemental Indenture dated as of June 15, 1988, a Forty-Second Supplemental Indenture dated as of August 1, 1988, a Forty-Third Supplemental Indenture dated as of September 15, 1989, a Forty-Fourth Supplemental Indenture dated as of March 15, 1990, a Forty-Fifth Supplemental Indenture dated as of March 15, 1990, a Forty-Sixth Supplemental Indenture dated as of June 1, 1990, a Forty-Seventh Supplemental Indenture dated as of July 15, 1991, a Forty-Eighth Supplemental Indenture dated as of July 15, 1992, a Forty-Ninth Supplemental Indenture dated as of February 15, 1993, a Fiftieth Supplemental Indenture dated as of February 15, 1993, a Fifty-First Supplemental Indenture dated as of February 1, 1994, a Fifty-Second Supplemental Indenture dated as of April 30, 1999, a Fifty-Third Supplemental Indenture dated as of June 15, 2001, a Fifty-Fourth Supplemental Indenture dated as of September 1, 2002, a Fifty-Fifth Supplemental Indenture dated as of February 15, 2003, a Fifty-Sixth Supplemental Indenture dated as of December 1, 2004, a Fifty-Seventh Supplemental Indenture dated as of August 21, 2008, a Fifty-Eighth Supplemental Indenture dated as of December 19, 2008, a Fifty-Ninth Supplemental Indenture dated as

 

2

 

of March 23, 2009, a Sixtieth Supplemental Indenture dated as of June 1, 2009, a Sixty-First Supplemental Indenture dated as of October 1, 2009, a Sixty-Second Supplemental Indenture dated as of July 9, 2010, a Sixty-Third Supplemental Indenture dated as of September 23, 2010, a Sixty-Fourth Supplemental Indenture dated as of December 1, 2011, and a Sixty-Fifth Supplemental Indenture dated as of March 15, 2012, each supplementing and amending the Indenture; and

 

WHEREAS, the Thirty-Fifth Supplemental Indenture authorized and appointed LaSalle Bank National Association, a national banking association duly organized and existing under the laws of the United States of America with its principal office in Chicago, Illinois and formerly named LaSalle National Bank, as Successor Trustee to The First National Bank of Chicago, which appointment was accepted, and all trust powers under the Indenture were thereby transferred from The First National Bank of Chicago to LaSalle Bank National Association; and

 

WHEREAS, by an Instrument of Resignation, Appointment and Acceptance dated as of December 15, 2008, Bank of America, N.A., as successor by merger to LaSalle Bank National Association, resigned as trustee and the Company appointed the Trustee as Successor Trustee thereto, which appointment was thereby accepted by the Trustee effective as of that date, and all trust powers were thereby transferred from Bank of America, N.A. to the Trustee; and

 

WHEREAS, the Forty-Sixth Supplemental Indenture amended the Indenture to reflect a change in the name of the Company from Public Service Company of Indiana, Inc. to PSI Energy, Inc. effective as of April 20, 1990, and the Fifty-Seventh Supplemental Indenture amended the Indenture to reflect a change in the name of the Company from PSI Energy, Inc. to Duke Energy Indiana, Inc., effective as of October 1, 2006; and

 

WHEREAS, as of July 11, 2013, the only bonds that have been heretofore issued under the Indenture which are now outstanding are $28,000,000 aggregate principal amount of “PSI Energy, Inc. First Mortgage Bonds, Series WW, Due August 15, 2027” and $53,055,000 aggregate principal amount of “PSI Energy, Inc. First Mortgage Bonds, Series CCC, 8.85%, Due January 15, 2022” and $38,000,000 aggregate principal amount of “PSI Energy, Inc. First Mortgage Bonds, Series DDD, 8.31%, Due September 1, 2032” and $500,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series LLL, 6.35%, Due August 15, 2038” and $46,715,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, 2005A Pledge Series, Due July 1, 2035” and $450,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series MMM, 6.45%, Due April 1, 2039” and $55,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series NNN, 6%, Due August 1, 2039” and $50,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series OOO, 4.95%, Due October 1, 2040” and $500,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series PPP, 3.75%, Due July 15, 2020” and $10,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage

 

3

 

Bonds, Series QQQ, 33⁄4%, Due April 1, 2022” and $59,600,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series RRR, 33/8%, Due March 1, 2019” and $44,025,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series SSS, Due May 1, 2035” and $23,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series TTT, Due March 1, 2031” and $250,000,000 aggregate principal amount of “Duke Energy Indiana, Inc. First Mortgage Bonds, Series UUU, 4.20%, Due March 15, 2042”; and

 

WHEREAS, in accordance with the provisions of Section 1 of Article XVIII of the Indenture, the Board of Directors has authorized the execution and delivery by the Company of a Sixty-Sixth Supplemental Indenture, substantially in the form of this Sixty-Sixth Supplemental Indenture, for the purpose of creating a sixty-seventh and a sixty-eighth series of bonds to be issued under the Indenture, to be known, respectively, as “Duke Energy Indiana, Inc. First Mortgage Bonds, Series VVV, Floating Rate, Due July 11, 2016” (such bonds being hereinafter referred to as the “Bonds of Series VVV”) and “Duke Energy Indiana, Inc. First Mortgage Bonds, Series WWW, 4.90%, Due July 15, 2043” (such bonds being hereinafter referred to as the “Bonds of Series WWW” and, together with the Bonds of Series VVV, the “Bonds”), and prescribing the form and substance of the Bonds of Series VVV and the Bonds of Series WWW (each, a “Series” or “Series of Bonds”) and the terms, provisions and characteristics thereof, and for the purpose of adding to the covenants and agreements of the Company for the protection of the bondholders and of the trust estate, of providing the terms and conditions for the redemption of the Bonds of Series WWW, of adding certain other covenants and undertakings with respect to the Bonds of each Series and of making such changes in the Indenture as are deemed necessary or desirable and as are permitted by the Indenture; and

 

WHEREAS, all conditions and requirements necessary to make this Sixty-Sixth Supplemental Indenture a valid, binding and legal instrument have been done, performed and fulfilled and the execution and delivery hereof have been in all respects duly authorized:

 

NOW, THEREFORE, in consideration of the premises, and of the acceptance and purchase of the Bonds of each Series by the holders and registered owners thereof, and of the sum of One Dollar ($1.00) duly paid by the Trustee to the Company, the receipt whereof is hereby acknowledged, and in accordance with and subject to the terms and provisions of the Indenture, the Company and the Trustee, respectively, have entered into, executed and delivered this Sixty-Sixth Supplemental Indenture for the uses and purposes hereinafter expressed, that is to say:

 

4

 

ARTICLE I.

 

FIRST MORTGAGE BONDS, SERIES VVV, FLOATING RATE, DUE JULY 11, 2016, AND

FIRST MORTGAGE BONDS, SERIES WWW, 4.90%, DUE JULY 15, 2043

 

Section 1.  There are hereby created a sixty-seventh and a sixty-eighth series of bonds to be issued under and secured by the Indenture, to be designated as “Duke Energy Indiana, Inc. First Mortgage Bonds, Series VVV, Floating Rate, Due July 11, 2016” and “Duke Energy Indiana, Inc. First Mortgage Bonds, Series WWW, 4.90%, Due July 15, 2043,” respectively (such series being the Bonds of Series VVV and the Bonds of Series WWW hereinbefore referred to).

 

Section 2.  The following provisions shall apply to each Series of Bonds.

 

(a)              The Bonds of each Series shall be issued in fully registered form only.  However, except as provided elsewhere in this Section, the registered owner of each Series of Bonds initially shall be The Depository Trust Company (“DTC”) or its nominee, and each such Series of Bonds initially shall be registered in the name of DTC or its nominee.  Payment of the principal of or interest on Bonds registered in the name of DTC or its nominee shall be made in the manner specified in DTC’s rules and by-laws.  DTC (and any successor securities depository) and its (or their) participating institutions (each, a “Participant”) shall maintain a book-entry registration and transfer system with respect to ownership of beneficial interests in the Bonds of each Series (the “Book-Entry System”).

 

(b)              The Bonds of each Series initially shall be issued in the form of one or more authenticated, fully registered bonds for such series (each a “Global Security”) which (i) need not be in the form of a lithographed or engraved certificate, but may be typewritten or printed on ordinary paper or such paper as the Trustee may reasonably request, (ii) shall represent and be denominated in an amount equal to 100% of the aggregate principal amount of each such Series issued under this Supplemental Indenture, (iii) shall be executed by the Company and authenticated by the Trustee in accordance with the provisions of the Indenture, (iv) shall be registered in the name of DTC or its nominee, and delivered to DTC or its nominee or a custodian therefor, and (v) shall contain the following legend on the face thereof:

 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), to issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as 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),

 

5

 

ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered holder hereof, Cede & Co., has an interest herein.

 

Unless and until it is exchanged in whole or in part for Bonds of Series VVV or Bonds of Series WWW (as applicable) in definitive certificated form, each Global Security representing a Series of Bonds may not be transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or by DTC or any such nominee to a successor securities depository or a nominee of any such successor securities depository.

 

(c)  The Trustee and the Company may treat Cede & Co. or its nominee, or any successor securities depository or nominee thereof (collectively, the “Depository”) as the sole and exclusive owner of each Series of Bonds, registered in its name for the purposes of payment of the principal or redemption price of or interest on such Series of Bonds, giving any notice permitted or required to be given to holders of such Series of Bonds under the Indenture or this Supplemental Indenture, registering the transfer of such Series of Bonds, obtaining any consent or other action to be taken by holders of such Series of Bonds, and for all other purposes whatsoever and neither the Trustee nor the Company shall be affected by any notice to the contrary. Neither the Company nor the Trustee nor any registrar nor any paying agent shall have any responsibility or obligation to any Participant, any person claiming a beneficial ownership interest in a Series of Bonds under or through the Depository or any Participant, or any other person which is not shown on the registration books as being a holder of a Series of Bonds with respect to (i) the accuracy of any records maintained by the Depository or any Participant; (ii) the payment by the Depository to any Participant of any amount in respect of the principal or interest on such Series of Bonds or the redemption price of the Bonds of Series WWW; (iii) the payment by any Participant to any owner of a beneficial ownership interest in such Series of Bonds, in respect of the principal of or interest on such Series of Bonds or (iv) any consent or other action taken by the Depository as owner of such Series of Bonds.  The Trustee shall pay all principal of and interest on each Series of Bonds only to or upon the order of the registered holder or holders of such Series of Bonds, as shown on the registration books, and all such payments shall be valid and effective to fully satisfy and discharge the Company’s obligations with respect to the principal or redemption price of and interest on such Series of Bonds, to the extent of the sum or sums so paid.  No person other than a holder of a Series of Bonds, as shown on the registration books of DTC, shall receive an authenticated Bond of such Series evidencing the obligation of the Company to make payment of the principal of and interest on such Series of Bonds, pursuant to the Indenture and this Supplemental Indenture. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee for Cede & Co, and subject to the provisions of the Indenture and this Supplemental

 

6

 

Indenture, the word “Cede & Co.”, as used in this Supplemental Indenture, shall refer to each new nominee of DTC.

 

(d)  In the event that after the occurrence of an event of default relating to a Series of Bonds that has not been cured or waived, holders of a majority in aggregate principal amount of the beneficial interests in such Series of Bonds, as reflected in the books and records of the Depository, notify the Trustee, through the Depository or any Participant, that the continuation of the Book-Entry System is no longer in the best interests of such holders of beneficial interests in the Bonds of such Series, then the Trustee shall notify the Depository and the Company, and the Depository will notify each Participant of the availability through the Depository of definitive certificated Bonds of such Series.

 

In such event, the Company shall execute, and the Trustee, upon receipt of a written order of the Company, signed by its President or a Vice President and by its Treasurer, Assistant Treasurer, Secretary or Assistant Secretary (an “Issuer Order”), for the authentication and delivery of definitive certificated Bonds of such Series, will authenticate and deliver Bonds of such Series in definitive certificated form, in any authorized denominations, all pursuant to the provisions of the Indenture, to the person or persons specified to the Trustee in writing by the Depository in the aggregate principal amount of the applicable Global Security or Securities and in exchange for such Global Security or Securities.

 

(e)  If at any time the Depository notifies the Company that it is unwilling or unable to continue as Depository for a Series of Bonds, or if at any time the Depository shall no longer be registered as a clearing agency in good standing under the Securities Exchange Act of 1934, as amended, or other applicable statute or regulation, the Company may appoint a successor Depository with respect to the Bonds of such Series. If a successor Depository for the Bonds of such Series is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such condition, the Company will execute, and the Trustee, upon receipt of an Issuer Order for the authentication and delivery of definitive certificated Bonds of such Series, will authenticate and deliver Bonds of such Series in definitive certificated form, in any authorized denominations, all pursuant to the provisions of the Indenture, to the person or persons specified to the Trustee in writing by the Depository in the aggregate principal amount of the applicable Global Security or Securities and in exchange for such Global Security or Securities.

 

(f)  The Company may at any time and in its sole discretion determine that a Series of Bonds shall no longer be represented by a Global Security or Securities. In such event the Company will execute, and the Trustee, upon receipt of an Issuer Order for the authentication and delivery of definitive certificated Bonds of such Series, will authenticate and deliver such Bonds in definitive certificated form, in any authorized denominations, all pursuant to the provisions of the Indenture, to the person or persons specified to the Trustee in writing by the Depository in the

 

7

 

aggregate principal amount of the applicable Global Security or Securities and in exchange for such Global Security or Securities.

 

(g)  Upon the exchange of any Global Security for the Bonds of Series VVV or the Bonds of Series WWW in definitive certificated form, in authorized denominations, the Global Security or Securities shall be cancelled by the Trustee.

 

(h)  Whenever the Depository requests the Company and the Trustee to do so, the Trustee and the Company will cooperate with the Depository in taking appropriate action after reasonable notice to (i) make available one or more separate Global Securities evidencing a Series of Bonds to any Participant having Bonds of such Series credited to its account at the Depository, or (ii) arrange for another Depository to maintain custody of the Global Security or Securities evidencing a Series of Bonds.

 

(i)  In connection with any notice or other communication to be provided to holders of a Series of Bonds pursuant to the Indenture and this Supplemental Indenture by the Company or the Trustee with respect to any consent or other action to be taken by holders of the Bonds of such Series, the Company or the Trustee, as the case may be, shall establish a record date for such consent or other action and give the Depository notice of such record date not less than 15 calendar days in advance of such record date to the extent possible. Such notice to the Depository shall be given only so long as a Depository or its nominee is the sole holder of such Series of Bonds.

 

The Bonds of Series VVV and the Bonds of Series WWW and the Trustee’s certificate to be endorsed thereon shall be substantially in the following forms, respectively:

 

[THE REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY.]

 

8

 

(FORM OF FACE OF BOND OF SERIES VVV)

 

[Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), to issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as 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 holder hereof, Cede & Co., has an interest herein.](1)

 

	
No. VVV-R-
    	
$            
    
	
CUSIP   No: 263901 AE0
    	
 
    
	
ISIN:   US263901AE08
    	
 
    

 

DUKE ENERGY INDIANA, INC.

FIRST MORTGAGE BOND, SERIES VVV, FLOATING RATE,

DUE JULY 11, 2016

 

Duke Energy Indiana, Inc., an Indiana corporation (hereinafter called the “Company”), for value received, hereby promises to pay to                             , or registered assigns, the principal sum of                                                            Dollars ($   ) on the eleventh day of July, 2016 and to pay interest on said sum from the date hereof, until said principal sum is paid, at the rates per annum determined in accordance with the provisions specified on the reverse hereof, payable quarterly in arrears on the eleventh day of January, April, July and October of each year, beginning on October 11, 2013.  Both the principal of and the interest on this bond shall be payable in any coin or currency of the United States of America which at the time of payment is legal tender for the payment of public and private debts at the office or agency of the Company in Plainfield, Indiana, or, at the option of the registered owner hereof, at the office or agency of the Company in the Borough of Manhattan, the City of New York, State of New York, except that interest on this bond may be paid, at the option of the Company, by check or draft mailed to the address of the person entitled thereto as it appears on the books of the Company maintained for that purpose.

 

REFERENCE IS MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF.  SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE.

 

This bond shall not be valid or become obligatory for any purpose unless and until it shall have been authenticated by the execution by the Trustee, or its successor in trust under the Indenture, of the certificate endorsed hereon.

 

(1)   This should be included only if the Bonds of Series VVV are being issued in global form.

 

9

 

IN WITNESS WHEREOF, Duke Energy Indiana, Inc. has caused this bond to be executed in its name by the manual or facsimile signature of its President or an Executive Vice President or one of its Vice Presidents, and its corporate seal or a facsimile thereof to be hereto affixed and attested by the manual or facsimile signature of its Secretary or one of its Assistant Secretaries.

 

	
Dated   as of:
    	
 
    
	
 
    	
 
    
	
 
    	
DUKE   ENERGY INDIANA, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
President
    
	
 
    	
 
    
	
ATTEST:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Secretary
    	
 
    
						

 

10

 

(FORM OF REVERSE OF BOND OF SERIES VVV)

 

This bond is one of the bonds of the Company issued and to be issued from time to time under and in accordance with and all secured by an indenture of mortgage or deed of trust, dated September 1, 1939, from Public Service Company of Indiana (predecessor of the Company) to The First National Bank of Chicago, as Trustee, to which Deutsche Bank National Trust Company is successor trustee (which indenture as amended by all supplemental indentures is hereinafter referred to as the “Indenture”). Said Trustee or its successor in trust under the Indenture is hereinafter sometimes referred to as the “Trustee.” Reference is hereby made to the Indenture for a description of the property mortgaged and pledged and the nature and extent of the security for said bonds. By the terms of the Indenture, the bonds secured thereby are issuable in series which may vary as to date, amount, dates of maturity, rate of interest and in other respects as in the Indenture provided.

 

This bond is one of a series designated as “Duke Energy Indiana, Inc. First Mortgage Bonds, Series VVV, Floating Rate, Due July 11, 2016” (hereinafter referred to as the “Bonds of Series VVV”) of the Company issued under and secured by the Indenture and created by a Sixty-Sixth Supplemental Indenture, dated as of July 11, 2013 (the “Sixty-Sixth Supplemental Indenture”), which also amends the Indenture.

 

The Bonds of Series VVV will bear interest for each Interest Period at a per annum rate determined by the Calculation Agent, subject to the Maximum Interest Rate. The interest rate applicable during each Interest Period will be equal to LIBOR on the Interest Determination Date for such Interest Period plus 0.35%. Promptly upon such determination, the Calculation Agent will notify the Company and the Trustee (as defined on the Reverse hereof), if the Trustee is not then serving as the Calculation Agent, of the interest rate for the new Interest Period. The interest rate determined by the Calculation Agent, absent manifest error, shall be binding and conclusive upon the beneficial owners and holders of the Bonds of Series VVV, the Company and the Trustee.

 

Upon the request of a holder of the Bonds of Series VVV, the Calculation Agent will provide to such holder the interest rate in effect on the date of such request and, if determined, the interest rate for the next Interest Period.

 

Interest on the Bonds of Series VVV shall be computed on the basis of the actual number of days elapsed over a 360-day year. The accrued interest for any period is calculated by multiplying the principal amount of Bonds of Series VVV by an accrued interest factor. The accrued interest factor is computed by adding the interest factor calculated for each day in the period for which accrued interest is being calculated. The interest factor (expressed as a decimal rounded upwards if necessary) is computed by dividing the interest rate (expressed as a decimal rounded upwards if necessary) applicable to such date by 360.

 

All percentages resulting from any calculation of the interest rate on the Bonds of Series VVV will be rounded, if necessary, to the nearest one-hundred thousandth of a

 

11

 

percentage point, with five one-millionths of a percentage point rounded upwards (e.g., 0.567845% (or .00567845) being rounded to 0.56785% (or .0056785) and 0.567844% (or .00567844) being rounded to 0.56784% (or .0056784)), and all dollar amounts used in or resulting from such calculation will be rounded to the nearest cent (with one-half cent being rounded upwards).

 

The following definitions apply to the Bonds of Series VVV:

 

“Business Day” means a day other than (i) a Saturday or Sunday, (ii) a day on which banks in New York, New York are authorized or obligated by law or executive order to remain closed or (iii) a day on which the Trustee’s corporate trust office is closed for business.

 

“Calculation Agent” means Deutsche Bank National Trust Company, or its successor appointed by the Company, acting as calculation agent.

 

“Interest Determination Date” means the second London Business Day immediately preceding the first day of the relevant Interest Period.

 

“Interest Period” means the period commencing on an interest payment date for the Bonds of Series VVV (or, with respect to the initial Interest Period only, commencing on the issue date for the Bonds of Series VVV) and ending on the day before the next succeeding interest payment date for the Bonds of Series VVV.

 

“LIBOR” means, with respect to any Interest Period, the rate (expressed as a percentage per annum) for deposits in U.S. dollars for a three-month period commencing on the first day of that Interest Period and ending on the next interest payment date for the Bonds of Series VVV that appears on Reuters LIBOR01 Page as of 11:00 a.m. (London time) on the Interest Determination Date for that Interest Period. If such rate does not appear on the Reuters LIBOR01 Page as of 11:00 a.m. (London time) on the Interest Determination Date for that Interest Period, LIBOR will be determined on the basis of the rates at which deposits in U.S. dollars for the Interest Period and in a principal amount of not less than $1,000,000 are offered to prime banks in the London interbank market by four major banks in the London interbank market, which may include affiliates of one or more of the underwriters of the Bonds of Series VVV, selected by the Company, at approximately 11:00 a.m., London time, on the Interest Determination Date for that Interest Period. The Company will request the principal London office of each such bank to provide a quotation of its rate to the Calculation Agent. If at least two such quotations are provided, LIBOR with respect to that Interest Period will be the arithmetic mean of such quotations. If fewer than two quotations are provided, LIBOR with respect to that Interest Period will be the arithmetic mean of the rates quoted by three major banks in New York City, which may include affiliates of one or more of the underwriters of the Bonds of Series VVV, selected by the Company, at approximately 11:00 a.m., New York City time, on the Interest Determination Date for that Interest Period for loans in U.S. dollars to leading European banks for that Interest Period and in a principal amount of not less than $1,000,000. However, if fewer than

 

12

 

three banks selected by the Company to provide quotations are quoting as described above, LIBOR for that Interest Period will be the same as LIBOR as determined for the previous Interest Period.

 

“London Business Day” means a day that is a Business Day and a day on which dealings in deposits in U.S. dollars are transacted, or with respect to any future date are expected to be transacted, in the London interbank market.

 

“Maximum Interest Rate” means the lesser of (a) 10% per annum, and (b) the maximum rate of interest permitted under the laws of the State of Indiana.

 

“Reuters LIBOR01 Page” means the display designated as Reuters LIBOR01 on the Reuters 3000 Xtra (or such other page as may replace the Reuters LIBOR01 Page on that service, or such other service as may be nominated as the information vendor, for the purpose of displaying rates or prices comparable to the London Interbank Offered rate for U.S. dollar deposits).

 

The rights and obligations of the Company and of the bearers and registered owners of bonds may be modified or amended with the consent of the Company by an affirmative vote of the bearers or registered owners entitled to vote of at least seventy-five per centum (75%) in principal amount of the bonds then outstanding at a meeting of bondholders called for the purpose (and by an affirmative vote of the bearers or registered owners entitled to vote of at least seventy-five per centum (75%) in principal amount of bonds of any series affected by such modification or amendment in case one or more, but less than all, series of bonds are so affected), all in the manner and subject to the limitations set forth in the Indenture, any consent by the bearer or registered owner of any bond being conclusive and binding upon such bearer or registered owner and upon all future bearers or registered owners of such bond, irrespective of whether or not any notation of such consent is made on such bond; provided that no such modification or amendment shall, among other things, extend the maturity or reduce the amount of, or reduce the rate of interest on, or otherwise modify the terms of the payment of the principal of, or interest or premium (if any) on this bond, which obligations are absolute and unconditional, or permit the creation of any lien ranking prior to or equal with the lien of the Indenture on any of the mortgaged property.  The Sixty-Sixth Supplemental Indenture provides that at any time when no bonds issued under the Indenture prior to the issuance of the “PSI Energy, Inc. First Mortgage Bonds, Series BBB, 8%, Due July 15, 2009” are outstanding, the Company reserves the right to amend the Indenture, without the consent or other action by the holders of the bonds outstanding at that time, to decrease the seventy-five per centum (75%) vote requirement referred to above to sixty-six and two-thirds per centum (66-2/3%).

 

The Bonds of Series VVV are not redeemable prior to maturity.

 

In the case of any of certain events of default specified in the Indenture, the principal of this bond may be declared or may become due and payable prior to the stated date of maturity hereof in the manner and with the effect provided in the Indenture.

 

13

 

No recourse shall be had for the payment of the principal of or interest on this bond, or for any claim based hereon, or otherwise in respect hereof or of the Indenture, to or against any incorporator, shareholder, officer or director, past, present or future, of the Company or of any predecessor or successor company, either directly or through the Company or such predecessor or successor company, under any constitution or statute or rule of law, or by the enforcement of any assessment or penalty, or otherwise, all such liability of incorporators, shareholders, directors and officers being waived and released by the registered owner hereof by the acceptance of this bond and being likewise waived and released by the terms of the Indenture.

 

The Bonds of Series VVV are issuable only in registered form without coupons. This bond is transferable by the registered owner hereof, in person or by an attorney duly authorized, at the principal office or place of business of Deutsche Bank National Trust Company, the Trustee, or its successor in trust under the Indenture, or, if the Bonds of Series VVV are not Global Securities, at the option of the registered owner, at the office or agency of the Company in the Borough of Manhattan, the City of New York, State of New York, upon the surrender and cancellation of this bond, and upon any such transfer a new registered bond or bonds of the same series and maturity date and for the same aggregate principal amount will be issued to the transferee in exchange herefor.

 

The Bonds of Series VVV are issuable in denominations of $2,000 and multiples of $1,000 in excess thereof as shall from time to time be determined and authorized by the Board of Directors of the Company. In the manner and subject to the limitations provided in the Indenture, Bonds of Series VVV are exchangeable as between authorized denominations, upon presentation thereof for such purpose by the registered owner, at the principal office or place of business of Deutsche Bank National Trust Company, the Trustee, or its successor in trust under the Indenture, or, at the option of the registered owner, at the office or agency of the Company in the Borough of Manhattan, the City of New York, State of New York.

 

No service charge will be made for any transfer or exchange of this bond, but the Company may require a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

14

 

(FORM OF TRUSTEE’S CERTIFICATE)

 

TRUSTEE’S CERTIFICATE

 

This bond is one of the Bonds of Series VVV designated therein referred to and described in the within mentioned Indenture and Sixty-Sixth Supplemental Indenture.

 

	
 
    	
DEUTSCHE   BANK NATIONAL TRUST COMPANY, AS TRUSTEE
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Authorized Officer
    

 

[THE REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY.]

 

15

 

(FORM OF FACE OF BOND OF SERIES WWW)

 

[Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation (“DTC”), to issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as 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 holder hereof, Cede & Co., has an interest herein.](2)

 

	
No. WWW-R-
    	
$            
    
	
CUSIP   No: 263901 AF7
    	
 
    
	
ISIN:   US263901AF72
    	
 
    

 

DUKE ENERGY INDIANA, INC.

FIRST MORTGAGE BOND, SERIES WWW, 4.90%,

DUE JULY 15, 2043

 

Duke Energy Indiana, Inc., an Indiana corporation (hereinafter called the “Company”), for value received, hereby promises to pay to                             , or registered assigns, the principal sum of                                                            Dollars ($   ) on the fifteenth day of July, 2043 and to pay interest on said sum from the date hereof, until said principal sum is paid, at the rate of 4.90% per annum, payable semi-annually on the fifteenth day of January and July in each year. Both the principal of and the interest on this bond shall be payable in any coin or currency of the United States of America which at the time of payment is legal tender for the payment of public and private debts at the office or agency of the Company in Plainfield, Indiana, or, at the option of the registered owner hereof, at the office or agency of the Company in the Borough of Manhattan, the City of New York, State of New York, except that interest on this bond may be paid, at the option of the Company, by check or draft mailed to the address of the person entitled thereto as it appears on the books of the Company maintained for that purpose.

 

REFERENCE IS MADE TO THE FURTHER PROVISIONS OF THIS BOND SET FORTH ON THE REVERSE HEREOF.  SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE.

 

This bond shall not be valid or become obligatory for any purpose unless and until it shall have been authenticated by the execution by the Trustee, or its successor in trust under the Indenture, of the certificate endorsed hereon.

 

(2)   This should be included only if the Bonds of Series WWW are being issued in global form.

 

16

 

IN WITNESS WHEREOF, Duke Energy Indiana, Inc. has caused this bond to be executed in its name by the manual or facsimile signature of its President or an Executive Vice President or one of its Vice Presidents, and its corporate seal or a facsimile thereof to be hereto affixed and attested by the manual or facsimile signature of its Secretary or one of its Assistant Secretaries.

 

Dated as of:

 

	
 
    	
 
    	
DUKE   ENERGY INDIANA, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
President
    
	
 
    	
 
    	
 
    
	
ATTEST:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Secretary
    	
 
    	
 
    
						

 

17

 

(FORM OF REVERSE OF BOND OF SERIES WWW)

 

This bond is one of the bonds of the Company issued and to be issued from time to time under and in accordance with and all secured by an indenture of mortgage or deed of trust, dated September 1, 1939, from Public Service Company of Indiana (predecessor of the Company) to The First National Bank of Chicago, as Trustee, to which Deutsche Bank National Trust Company is successor trustee (which indenture as amended by all supplemental indentures is hereinafter referred to as the “Indenture”). Said Trustee or its successor in trust under the Indenture is hereinafter sometimes referred to as the “Trustee.” Reference is hereby made to the Indenture for a description of the property mortgaged and pledged and the nature and extent of the security for said bonds. By the terms of the Indenture, the bonds secured thereby are issuable in series which may vary as to date, amount, dates of maturity, rate of interest and in other respects as in the Indenture provided.

 

This bond is one of a series designated as “Duke Energy Indiana, Inc. First Mortgage Bonds, Series WWW, 4.90%, Due July 15, 2043” (hereinafter referred to as the “Bonds of Series WWW”) of the Company issued under and secured by the Indenture and created by a Sixty-Sixth Supplemental Indenture, dated as of July 11, 2013 (the “Sixty-Sixth Supplemental Indenture”), which also amends the Indenture.

 

The rights and obligations of the Company and of the bearers and registered owners of bonds may be modified or amended with the consent of the Company by an affirmative vote of the bearers or registered owners entitled to vote of at least seventy-five per centum (75%) in principal amount of the bonds then outstanding at a meeting of bondholders called for the purpose (and by an affirmative vote of the bearers or registered owners entitled to vote of at least seventy-five per centum (75%) in principal amount of bonds of any series affected by such modification or amendment in case one or more, but less than all, series of bonds are so affected), all in the manner and subject to the limitations set forth in the Indenture, any consent by the bearer or registered owner of any bond being conclusive and binding upon such bearer or registered owner and upon all future bearers or registered owners of such bond, irrespective of whether or not any notation of such consent is made on such bond; provided that no such modification or amendment shall, among other things, extend the maturity or reduce the amount of, or reduce the rate of interest on, or otherwise modify the terms of the payment of the principal of, or interest or premium (if any) on this bond, which obligations are absolute and unconditional, or permit the creation of any lien ranking prior to or equal with the lien of the Indenture on any of the mortgaged property.  The Sixty-Sixth Supplemental Indenture provides that at any time when no bonds issued under the Indenture prior to the issuance of the “PSI Energy, Inc. First Mortgage Bonds, Series BBB, 8%, Due July 15, 2009” are outstanding, the Company reserves the right to amend the Indenture, without the consent or other action by the holders of the bonds outstanding at that time, to decrease the seventy-five per centum (75%) vote requirement referred to above to sixty-six and two-thirds per centum (66-2/3%).

 

18

 

At any time before January 15, 2043, the Bonds of Series WWW will be redeemable in whole or in part, at the option of the Company at any time, at a redemption price equal to the greater of (1) 100% of the principal amount of the Bonds of Series WWW to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest thereon (exclusive of interest accrued to the redemption date), discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 0.25% (25 basis points), plus, in each case, accrued and unpaid interest to the redemption date. For the avoidance of doubt, interest that is due and payable on an interest payment date falling on or prior to a redemption date will be payable on such interest payment date in accordance with the Bonds of Series WWW and the Indenture. The Company shall notify the Trustee of the redemption price with respect to any redemption pursuant to this paragraph promptly after the calculation thereof. The Trustee shall not be responsible for calculating said redemption price.

 

At any time on or after January 15, 2043, the Bonds of Series WWW will be redeemable in whole or in part, at the option of the Company at any time, at a redemption price equal to 100% of the principal amount of such Bonds of Series WWW to be redeemed plus accrued and unpaid interest to the date of redemption.

 

For purposes of the redemption provisions of the Bonds of Series WWW, the following terms have the following meanings:

 

“Business Day” means a day other than (i) a Saturday or Sunday, (ii) a day on which banks in New York, New York are authorized or obligated by law or executive order to remain closed or (iii) a day on which the Trustee’s corporate trust office is closed for business.

 

“Comparable Treasury Issue” means the United States Treasury security selected by the Quotation Agent as having an actual or interpolated maturity comparable to the remaining term of the Bonds of Series WWW to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of a comparable maturity to the remaining term of the Bonds of Series WWW.

 

“Comparable Treasury Price” means, with respect to any redemption date for the Bonds of Series WWW, (A) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (B) if the Quotation Agent obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.

 

“Quotation Agent” means one of the Reference Treasury Dealers appointed by the Company.

 

“Reference Treasury Dealer” means each of Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Scotia Capital (USA) Inc., and a Primary Treasury Dealer (as

 

19

 

defined below) selected by Wells Fargo Securities, LLC, plus one other financial institution appointed by the Company at the time of any redemption, or their respective affiliates or successors, each of which is a  primary U.S. Government securities dealer in the United States (a “Primary Treasury Dealer”); provided, however, that if any of the foregoing or their affiliates or successors shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer.

 

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

 

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield to maturity or interpolated maturity (on a day count basis) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

 

Notice of any redemption by the Company will be mailed at least 30 days but not more than 60 days before any redemption date to each holder of Bonds of Series WWW to be redeemed. If less than all the Bonds of Series WWW are to be redeemed at the option of the Company, and if the Bonds of Series WWW are not Global Securities, the Trustee shall select, in such manner as it shall deem fair and appropriate, the Bonds of Series WWW to be redeemed in whole or in part.

 

Unless the Company defaults in payment of the redemption price, on and after any redemption date, interest will cease to accrue on the Bonds of Series WWW or portions thereof called for redemption.

 

In the case of any of certain events of default specified in the Indenture, the principal of this bond may be declared or may become due and payable prior to the stated date of maturity hereof in the manner and with the effect provided in the Indenture.

 

No recourse shall be had for the payment of the principal of or interest on this bond, or for any claim based hereon, or otherwise in respect hereof or of the Indenture, to or against any incorporator, shareholder, officer or director, past, present or future, of the Company or of any predecessor or successor company, either directly or through the Company or such predecessor or successor company, under any constitution or statute or rule of law, or by the enforcement of any assessment or penalty, or otherwise, all such liability of incorporators, shareholders, directors and officers being waived and released by the registered owner hereof by the acceptance of this bond and being likewise waived and released by the terms of the Indenture.

 

20

 

The Bonds of Series WWW are issuable only in registered form without coupons. This bond is transferable by the registered owner hereof, in person or by an attorney duly authorized, at the principal office or place of business of Deutsche Bank National Trust Company, the Trustee, or its successor in trust under the Indenture, or, if the Bonds of Series WWW are not Global Securities, at the option of the registered owner, at the office or agency of the Company in the Borough of Manhattan, the City of New York, State of New York, upon the surrender and cancellation of this bond, and upon any such transfer a new registered bond or bonds of the same series and maturity date and for the same aggregate principal amount will be issued to the transferee in exchange herefor.

 

The Bonds of Series WWW are issuable in denominations of $2,000 and multiples of $1,000 in excess thereof as shall from time to time be determined and authorized by the Board of Directors of the Company. In the manner and subject to the limitations provided in the Indenture, Bonds of Series WWW are exchangeable as between authorized denominations, upon presentation thereof for such purpose by the registered owner, at the principal office or place of business of Deutsche Bank National Trust Company, the Trustee, or its successor in trust under the Indenture, or, at the option of the registered owner, at the office or agency of the Company in the Borough of Manhattan, the City of New York, State of New York.

 

No service charge will be made for any transfer or exchange of this bond, but the Company may require a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

(FORM OF TRUSTEE’S CERTIFICATE)

 

TRUSTEE’S CERTIFICATE

 

This bond is one of the Bonds of Series WWW designated therein referred to and described in the within mentioned Indenture and Sixty-Sixth Supplemental Indenture.

 

	
 
    	
DEUTSCHE   BANK NATIONAL TRUST COMPANY, AS TRUSTEE
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Authorized Officer
    

 

[THE REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY.]

 

21

 

Section 3.  Each Bond of Series VVV and Bond of Series WWW issued prior to the first interest payment date shall be dated as of July 11, 2013, and otherwise shall be dated as provided in Section 1 of Article II of the Indenture.

 

Section 4.  All Bonds of Series VVV shall be due and payable on July 11, 2016, and shall bear interest from the date thereof at the rates set quarterly pursuant to this Section 4 until paid or duly provided for. Interest shall be paid quarterly in arrears on the eleventh day of January, April, July and October of each year, beginning on October 11, 2013, to each holder of record at the close of business on the first day of January, April, July and October (whether or not a business day) preceding the applicable interest payment date until the principal amount of the Bonds of Series VVV has been paid or made available for payment.  Interest on the Bonds of Series VVV shall be computed on the basis of the actual number of days elapsed over a 360-day year.

 

The Bonds of Series VVV will bear interest for each Interest Period at a per annum rate determined by the Calculation Agent, subject to the Maximum Interest Rate. The interest rate applicable during each Interest Period will be equal to LIBOR on the Interest Determination Date for such Interest Period plus 0.35%. Promptly upon such determination, the Calculation Agent will notify the Company and the Trustee, if the Trustee is not then serving as the Calculation Agent, of the interest rate for the new Interest Period. The interest rate determined by the Calculation Agent, absent manifest error, shall be binding and conclusive upon the beneficial owners and holders of the Bonds of Series VVV, the Company and the Trustee.

 

Upon the request of a holder of the Bonds of Series VVV, the Calculation Agent will provide to such holder the interest rate in effect on the date of such request and, if determined, the interest rate for the next Interest Period.

 

The accrued interest for any period is calculated by multiplying the principal amount of Bonds of Series VVV by an accrued interest factor. The accrued interest factor is computed by adding the interest factor calculated for each day in the period for which accrued interest is being calculated. The interest factor (expressed as a decimal rounded upwards if necessary) is computed by dividing the interest rate (expressed as a decimal rounded upwards if necessary) applicable to such date by 360.

 

All percentages resulting from any calculation of the interest rate on the Bonds of Series VVV will be rounded, if necessary, to the nearest one-hundred thousandth of a percentage point, with five one-millionths of a percentage point rounded upwards (e.g., 0.567845% (or .00567845) being rounded to 0.56785% (or .0056785) and 0.567844% (or .00567844) being rounded to 0.56784% (or .0056784)), and all dollar amounts used in or resulting from such calculation will be rounded to the nearest cent (with one-half cent being rounded upwards).

 

For purposes of the calculation required by the first paragraph of Section 5 of Article IV of the Indenture, annual interest in respect of the Bonds of Series VVV shall

 

22

 

be equal to the amount determined by multiplying the principal amount of the Bonds of Series VVV outstanding on the date of such calculation, if any, by 10% per annum.

 

The following definitions apply to the Bonds of Series VVV:

 

“Business Day” means a day other than (i) a Saturday or Sunday, (ii) a day on which banks in New York, New York are authorized or obligated by law or executive order to remain closed or (iii) a day on which the Trustee’s corporate trust office is closed for business.

 

“Calculation Agent” means Deutsche Bank National Trust Company, as appointed pursuant to Section 1 of Article III of this Supplemental Indenture, or its successor appointed by the Company pursuant to said Article III, acting as calculation agent.

 

“Interest Determination Date” means the second London Business Day immediately preceding the first day of the relevant Interest Period.

 

“Interest Period” means the period commencing on an interest payment date for the Bonds of Series VVV (or, with respect to the initial Interest Period only, commencing on the issue date for the Bonds of Series VVV) and ending on the day before the next succeeding interest payment date for the Bonds of Series VVV.

 

“LIBOR” means, with respect to any Interest Period, the rate (expressed as a percentage per annum) for deposits in U.S. dollars for a three-month period commencing on the first day of that Interest Period and ending on the next interest payment date for the Bonds of Series VVV that appears on Reuters LIBOR01 Page as of 11:00 a.m. (London time) on the Interest Determination Date for that Interest Period. If such rate does not appear on the Reuters LIBOR01 Page as of 11:00 a.m. (London time) on the Interest Determination Date for that Interest Period, LIBOR will be determined on the basis of the rates at which deposits in U.S. dollars for the Interest Period and in a principal amount of not less than $1,000,000 are offered to prime banks in the London interbank market by four major banks in the London interbank market, which may include affiliates of one or more of the underwriters of the Bonds of Series VVV, selected by the Company, at approximately 11:00 a.m., London time, on the Interest Determination Date for that Interest Period. The Company will request the principal London office of each such bank to provide a quotation of its rate to the Calculation Agent. If at least two such quotations are provided, LIBOR with respect to that Interest Period will be the arithmetic mean of such quotations. If fewer than two quotations are provided, LIBOR with respect to that Interest Period will be the arithmetic mean of the rates quoted by three major banks in New York City, which may include affiliates of one or more of the underwriters of the Bonds of Series VVV, selected by the Company, at approximately 11:00 a.m., New York City time, on the Interest Determination Date for that Interest Period for loans in U.S. dollars to leading European banks for that Interest Period and in a principal amount of not less than $1,000,000. However, if fewer than three banks selected by the Company to provide quotations are quoting as described

 

23

 

above, LIBOR for that Interest Period will be the same as LIBOR as determined for the previous Interest Period.

 

“London Business Day” means a day that is a Business Day and a day on which dealings in deposits in U.S. dollars are transacted, or with respect to any future date are expected to be transacted, in the London interbank market.

 

“Maximum Interest Rate” means the lesser of (a) 10% per annum, and (b) the maximum rate of interest permitted under the laws of the State of Indiana.

 

“Reuters LIBOR01 Page” means the display designated as Reuters LIBOR01 on the Reuters 3000 Xtra (or such other page as may replace the Reuters LIBOR01 Page on that service, or such other service as may be nominated as the information vendor, for the purpose of displaying rates or prices comparable to the London Interbank Offered rate for U.S. dollar deposits).

 

Section 5.  All Bonds of Series WWW shall be due and payable on July 15, 2043, and shall bear interest from the date thereof at the rate of 4.90% per annum, payable semi-annually on the fifteenth day of January and July in each year, commencing January 15, 2014, to each holder of record at the close of business on the first day of January and July  (whether or not a business day) preceding the applicable interest payment date until the principal amount of the Bonds of Series WWW has been paid or made available for payment. Interest on the Bonds of Series WWW shall be computed on the basis of a 360-day year consisting of twelve 30-day months.

 

Section 6.  Subject to agreements with or the rules of the Depository or any successor book-entry security system or similar system with respect to Global Securities, both the principal of and the interest on each Series of Bonds shall be payable in any coin or currency of the United States of America which at the time of payment is legal tender for the payment of public and private debts, at the office or agency of the Company in Plainfield, Indiana, or, at the option of the holder thereof, at the office or agency of the Company in the Borough of Manhattan, the City of New York, State of New York, except that interest on the Bonds of each Series may be paid, at the option of the Company, by check or draft mailed to the address of the person entitled thereto as it appears on the books of the Company maintained for that purpose.

 

Section 7.  Definitive Bonds of Series VVV and Bonds of Series WWW shall be issuable in denominations of $2,000 and multiples of $1,000 in excess thereof, numbered consecutively from “VVV-R-1” and “WWW-R-1,” respectively, upward.

 

The Bonds of each Series shall be executed on behalf of the Company by the manual or facsimile signature of its President or an Executive Vice President or one of its Vice Presidents and shall have affixed thereto the seal of the Company or a facsimile thereof attested by the manual or facsimile signature of its Secretary or one of its Assistant Secretaries and shall be authenticated by the execution by the Trustee of the certificate endorsed on said bonds.

 

24

 

No service charge will be made by the Company for the transfer or for the exchange of Bonds of Series VVV or Bonds of Series WWW except, in the case of transfer, a charge sufficient to reimburse the Company for any tax or other governmental charge payable in connection therewith.

 

Pursuant to the provisions of Section 11 of Article II of the Indenture, each Series of Bonds may be issued in temporary form, and if temporary bonds be issued, the Company shall, with all reasonable dispatch, at its own expense and without charge to the holders of the temporary bonds, prepare and execute definitive Bonds of such Series and exchange the temporary bonds for such definitive bonds in the manner provided for in said section, provided, however, no presentation or surrender of temporary Bonds of such Series shall be necessary in order for the holders entitled to interest thereon to receive such interest.

 

Section 8.  Article IX of the Indenture, “Maintenance and Renewal Fund and Sinking Fund Provisions”, as heretofore amended or supplemented shall not apply to the “PSI Energy, Inc. First Mortgage Bonds, Series BBB, 8%, Due July 15, 2009” (such bonds being hereinafter referred to as the “Bonds of Series BBB”) or to any subsequently created series of bonds (which includes the Bonds) from and after the date on which no series of bonds created under the Indenture prior to the Bonds of Series BBB are outstanding.

 

Section 9.  Section 22 of Article V of the Indenture as heretofore amended or supplemented which, among other things, requires an inspection of the mortgaged property every two years by an independent engineer, shall not apply to the Bonds of Series BBB or to any subsequently created series of bonds (which includes the Bonds), from and after the date on which no series of bonds created under the Indenture prior to the Bonds of Series BBB are outstanding.

 

Section 10.  The Company reserves the right, without consent or other action by the holders of the Bonds of Series BBB or of any subsequently created series of bonds (which includes the Bonds), to amend the Indenture, as heretofore amended or supplemented, at any time after all bonds of any series created prior to the Bonds of Series BBB are no longer outstanding under the Indenture, as follows:

 

(a)  by substituting for the words “in principal amount not greater than sixty per centum (60%) of” in Section 3 of Article IV thereof the following:

 

“in principal amount not greater than sixty-six and two-thirds per centum (66-2/3%) of”.

 

(b)  by substituting for the words “shall exceed sixty per centum (60%) of the value of bondable property so acquired” in Section 9 of Article V thereof the following:

 

25

 

“shall exceed sixty-six and two-thirds per centum (66-2/3%) of the value of bondable property so acquired”.

 

(c)  by substituting for the words “shall be deemed to be paid within the meaning of this article; provided, that the date for the payment or redemption of such bonds shall be not more than one (1) year after such moneys shall have been so set apart or paid.” in the first paragraph of Article XIV thereof the following:

 

“shall be deemed to be paid within the meaning of this article.”.

 

(d)  by substituting for the words “with the consent of holders of at least seventy-five per centum (75%) in aggregate principal amount of the bonds at the time outstanding;” in sub-section (a) of Section 3 of Article XVIII thereof the following:

 

“with the consent of holders of at least sixty-six and two-thirds per centum (66-2/3%) in aggregate principal amount of the bonds at the time outstanding;”.

 

(e)  by substituting for the words “holders (or persons entitled to vote the bonds) of not less than seventy-five per centum (75%) in aggregate principal amount of the bonds entitled to be voted” in sub-section (l) of Section 3 of Article XVIII thereof the following:

 

“holders (or persons entitled to vote the bonds) of not less than sixty-six and two-thirds per centum (66-2/3%) in aggregate principal amount of the bonds entitled to be voted”.

 

(f)  by substituting for the words “holders (or persons entitled to vote the bonds) of at least seventy-five per centum (75%) in principal amount of the bonds outstanding” in sub-section (m) of Section 3 of Article XVIII thereof the following:

 

“holders (or persons entitled to vote the bonds) of at least sixty-six and two-thirds per centum (66-2/3%) in principal amount of the bonds outstanding”.

 

Section 11.  The Bonds shall not be entitled to the benefit of a sinking fund.

 

26

 

ARTICLE II.

 

ISSUANCE OF BONDS OF SERIES VVV AND BONDS OF SERIES WWW.

 

Section 1.  An initial  issue of the Bonds of Series VVV, in the aggregate principal amount not exceeding one hundred fifty million dollars ($150,000,000), and an initial  issue of the Bonds of Series WWW, in the aggregate principal amount not exceeding three hundred fifty million dollars ($350,000,000), may be executed by the Company and delivered to the Trustee for authentication, and shall be authenticated and delivered by the Trustee to or upon the order of the Company (which authentication and delivery may be made without awaiting the filing or recording of this Sixty-Sixth Supplemental Indenture), upon receipt by the Trustee of the resolutions, certificates, orders, opinions and other instruments required by the provisions of Section 3 of Article IV of the Indenture to be received by the Trustee as a condition to the authentication and delivery by the Trustee of bonds pursuant to said Section 3.

 

Section 2.  Subject to the limitations provided in Section 24 of Article V of the Indenture, additional Bonds of each Series may be issued by the Company under the provisions of Sections 2, 3 or 4 of Article IV of the Indenture.

 

ARTICLE III.

 

CALCULATION AGENT FOR THE BONDS OF SERIES VVV.

 

Section 1.  Upon the terms and subject to the conditions contained herein, the Company hereby appoints Deutsche Bank National Trust Company as the Company’s calculation agent for the Bonds of Series VVV (the “Calculation Agent”) and Deutsche Bank National Trust Company hereby accepts such appointment as the Company’s agent for the purpose of calculating the applicable interest rates on the Bonds of Series VVV in accordance with the provisions set forth herein.

 

Section 2.  The Calculation Agent shall: (a) exercise due care to determine the interest rates on the Bonds of Series VVV and shall communicate the same to the Company and the Trustee (if the Trustee is not then serving as the Calculation Agent) as soon as practicable after each determination, and (b) keep such books and records with respect to its duties as Calculation Agent as shall be consistent with prudent industry practice and to make such books and records available for inspection by the Trustee and the Company at all reasonable times.

 

The Calculation Agent will, upon the request of a holder of the Bonds of Series VVV, provide to such holder the interest rate in effect on the date of such request and, if determined, the interest rate for the next Interest Period.

 

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Section 3.  The Calculation Agent accepts its obligations set forth herein, upon the terms and subject to the conditions hereof, including the following, to all of which the Company agrees:

 

(a)           The Calculation Agent shall be entitled to such compensation as may be agreed upon with the Company for all services rendered by the Calculation Agent, and the Company promises to pay such compensation and to reimburse the Calculation Agent for the reasonable out-of-pocket expenses (including attorneys’ fees and expenses) incurred by it in connection with the services rendered by it hereunder upon receipt of such invoices as the Company shall reasonably require. The Company also agrees to indemnify the Calculation Agent for, and to hold it harmless against, any and all loss, liability, damage, claim or expense (including the costs and expenses of defending against any claim (regardless of who asserts such claim) of liability) incurred by the Calculation Agent that arises out of or in connection with its accepting appointment as, or acting as, Calculation Agent hereunder, except such as may result from the willful misconduct or gross negligence of the Calculation Agent or any of its agents or employees.

 

(b)           In acting under this Supplemental Indenture, the Calculation Agent is acting solely as agent of the Company and does not assume any obligations to or relationship of agency or trust for or with any of the beneficial owners or holders of the Bonds of Series VVV.

 

(c)           The Calculation Agent shall be protected and shall incur no liability for or in respect of any action taken or omitted to be taken or anything suffered by it in reliance upon the terms of the Bonds of Series VVV or any notice, direction, certificate, affidavit, statement or other paper, document or communication reasonably believed by it to be genuine and to have been approved or signed by the proper party or parties.

 

(d)           The Calculation Agent, its officers, directors, employees and shareholders may become the owners or pledgee of, or acquire any interest in, any Bonds of Series VVV, with the same rights that it or they would have if it were not the Calculation Agent, and may engage or be interested in any financial or other transaction with the Company as freely as if it were not the Calculation Agent.

 

(e)           Neither the Calculation Agent nor its officers, directors, employees, agents or attorneys shall be liable to the Company for any act or omission hereunder, or for any error of judgment made in good faith by it or them, except in the case of its or their willful misconduct or gross negligence.

 

(f)            The Calculation Agent may consult with counsel of its selection appointed by it with due care and the advice of such counsel or any opinion of such counsel shall be full and complete authorization and protection in respect of

 

28

 

any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.

 

(g)           The Calculation Agent shall be obligated to perform such duties and only such duties as are herein specifically set forth, and no implied duties or obligations shall be read into this Supplemental Indenture against the Calculation Agent.

 

(h)           Unless herein otherwise specifically provided, any order, certificate, notice, request, direction or other communication from the Company made or given by it under any provision of this Supplemental Indenture shall be sufficient if signed by any officer of the Company.

 

(i)            The Calculation Agent may perform any duties hereunder either directly or by or through its agents or attorneys, and the Calculation Agent shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder.

 

(j)            The Company will not, without first obtaining the prior written consent of the Calculation Agent, make any change to this Supplemental Indenture or the Bonds of Series VVV if such change would materially and adversely affect the Calculation Agent’s duties and obligations hereunder or thereunder.

 

Section 4.  The Calculation Agent shall be authorized by law to perform all the duties imposed upon it by this Supplemental Indenture, and at all times have a capitalization of at least $50,000,000.  The Calculation Agent may not be an affiliate of the Company.

 

Section 5.  The Calculation Agent may at any time resign as Calculation Agent by giving written notice to the Company of such intention on its part, specifying the date on which its desired resignation shall become effective; provided, however, that such date shall never be earlier than 60 days after the receipt of such notice by the Company, unless the Company otherwise agrees in writing. The Calculation Agent may be removed at any time by the filing with it of any instrument in writing signed on behalf of the Company and specifying such removal and the date when it is intended to become effective. Such resignation or removal shall take effect upon the date of the appointment by the Company, as hereinafter provided, of a successor Calculation Agent. If within 30 days after notice of resignation or removal has been given, a successor Calculation Agent has not been appointed, the Calculation Agent may, at the expense of the Company, petition a court of competent jurisdiction to appoint a successor Calculation Agent. A successor Calculation Agent shall be appointed by the Company by an instrument in writing signed on behalf of the Company and the successor Calculation Agent. Upon the appointment of a successor Calculation Agent and acceptance by it of such appointment, the Calculation Agent so succeeded shall cease to be such Calculation Agent hereunder. Upon its resignation or removal, the Calculation Agent shall be entitled to the payment by the

 

29

 

Company of its compensation, if any is owed to it, for services rendered hereunder and to the reimbursement of all reasonable out-of-pocket expenses incurred in connection with the services rendered by it hereunder and to the payment of all other amounts owed to it hereunder.

 

Section 6.  Any successor Calculation Agent appointed hereunder shall execute and deliver to its predecessor and to the Company an instrument accepting such appointment hereunder, and thereupon such successor Calculation Agent, without any further act, deed or conveyance, shall become vested with all the authority, rights, powers, trusts, immunities, duties and obligations of such predecessor with like effect as if originally named as such Calculation Agent hereunder, and such predecessor, upon payment of its charges and disbursements then unpaid, shall thereupon become obliged to transfer and deliver, and such successor Calculation Agent shall be entitled to receive, copies of any relevant records maintained by such predecessor Calculation Agent.

 

Section 7.  In the event that the Calculation Agent shall resign or be removed, or be dissolved, or if the property or affairs of the Calculation Agent shall be taken under the control of any state or federal court or administrative body because of bankruptcy or insolvency or for any other reason, and the Company shall not have made a timely appointment of a successor Calculation Agent, the Trustee, notwithstanding the provisions of this Article III, shall be deemed to be the Calculation Agent for all purposes of this Supplemental Indenture until the appointment by the Company of the successor Calculation Agent.

 

Section 8.  Any corporation into which the Calculation Agent may be merged, or any corporation with which the Calculation Agent may be consolidated, or any corporation resulting from any merger or consolidation or to which the Calculation Agent shall sell or otherwise transfer all or substantially all of its corporate trust assets or business shall, to the extent permitted by applicable law, be the successor Calculation Agent under this Supplemental Indenture without the execution or filing of any paper or any further act on the part of any of the parties hereto. Notice of any such merger, consolidation or sale shall forthwith be given to the Company and the Trustee (if the Trustee is not then serving as the Calculation Agent).

 

Section 9.  Any request, demand, authorization, direction, notice, consent, waiver or other document provided or permitted hereby to be given or furnished to the Calculation Agent shall be delivered in person, sent by letter or fax or communicated by telephone (subject, in the case of communication by telephone, to confirmation dispatched within 24 hours by letter or by fax) as follows:

 

Deutsche Bank National Trust Company

100 Plaza One, 6th Floor

Jersey City, NJ 07311-3901

Attention: Global Debt Services

Telephone: (201) 593-2332

Fax: (732) 578-4635

 

30

 

or to any other address of which the Calculation Agent shall have notified the Company and the Trustee (if the Trustee is not then serving as the Calculation Agent) in writing as herein provided.

 

ARTICLE IV.

 

INDENTURE AMENDMENTS.

 

Section 1.  Article I of the Indenture, as heretofore amended, is hereby further amended (i) by adding immediately after subdivision “(105)” thereof an additional subdivision numbered “(106)” and reading as follows:

 

“(106) The term ‘Sixty-Sixth Supplemental Indenture’ shall mean the Sixty-Sixth Supplemental Indenture executed by the Company and the Trustee, dated as of July 11, 2013, supplementing and amending the Indenture; and the terms ‘Bonds of Series VVV’ shall mean the ‘Duke Energy Indiana, Inc. First Mortgage Bonds, Series VVV, Floating Rate, Due July 11, 2016’ and ‘Bonds of Series WWW’ shall mean the ‘Duke Energy Indiana, Inc. First Mortgage Bonds, Series WWW, 4.90%, Due July 15, 2043’ created by the Sixty-Sixth Supplemental Indenture.”

 

and (ii) by changing the numbering of the present subdivision “(106)” thereof to “(107)”.

 

Section 2.  Article VII of the Indenture, as heretofore amended, is hereby further amended by inserting therein immediately after Section 51 thereof, a new section designated “Section 52” and reading as follows:

 

“Section 52. At any time before January 15, 2043, the Bonds of Series WWW will be redeemable in whole or in part, at the option of the Company at any time, at a redemption price equal to the greater of (1) 100% of the principal amount of such Bonds of Series WWW to be redeemed and (2) the sum of the present values of the remaining scheduled payments of principal and interest thereon (exclusive of interest accrued to the redemption date), discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 0.25% (25 basis points), plus in each case, accrued and unpaid interest to the redemption date. For the avoidance of doubt, interest that is due and payable on an interest payment date falling on or prior to a redemption date will be payable on such interest payment date in accordance with the Bonds of Series WWW and the Indenture.  The Company shall notify the Trustee of the redemption price with respect to any redemption pursuant to this paragraph promptly after the calculation thereof. The Trustee shall not be responsible for calculating said redemption price.

 

At any time on or after January 15, 2043, the Bonds of Series WWW will be redeemable in whole or in part, at the option of the Company at any time, at a

 

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redemption price equal to 100% of the principal amount of the Bonds of Series WWW to be redeemed plus accrued and unpaid interest to the date of redemption.

 

For purposes of the redemption provisions of the Bonds of Series WWW, the following terms have the following meanings:

 

‘Business Day’ means a day other than (i) a Saturday or Sunday, (ii) a day on which banks in New York, New York are authorized or obligated by law or executive order to remain closed or (iii) a day on which the Trustee’s corporate trust office is closed for business.

 

‘Comparable Treasury Issue’ means the United States Treasury security selected by the Quotation Agent as having an actual or interpolated maturity comparable to the remaining term of the Bonds of Series WWW to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of a comparable maturity to the remaining term of the Bonds of Series WWW.

 

‘Comparable Treasury Price’ means, with respect to any redemption date for the Bonds of Series WWW, (A) the average of the Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (B) if the Quotation Agent obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.

 

‘Quotation Agent’ means one of the Reference Treasury Dealers appointed by the Company.

 

‘Reference Treasury Dealer’ means each of Citigroup Global Markets Inc., J.P. Morgan Securities LLC, Scotia Capital (USA) Inc., and a Primary Treasury Dealer (as defined below) selected by Wells Fargo Securities, LLC, plus one other financial institution appointed by the Company at the time of any redemption, or their respective affiliates or successors, each of which is a  primary U.S. Government securities dealer in the United States (a “Primary Treasury Dealer”); provided, however, that if any of the foregoing or their affiliates or successors shall cease to be a Primary Treasury Dealer, the Company shall substitute therefor another Primary Treasury Dealer.

 

‘Reference Treasury Dealer Quotations’ means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Quotation Agent, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at 5:00 p.m., New York City time, on the third Business Day preceding such redemption date.

 

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‘Treasury Rate’ means, with respect to any redemption date, the rate per annum equal to the semi-annual equivalent yield to maturity or interpolated maturity (on a day count basis) of the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

 

Notice of any redemption by the Company will be mailed at least 30 days but not more than 60 days before any redemption date to each holder of Bonds of Series WWW to be redeemed.  If less than all the Bonds of Series WWW are to be redeemed at the option of the Company, and if the Bonds of Series WWW are not Global Securities, the Trustee shall select, in such manner as it shall deem fair and appropriate, the Bonds of Series WWW to be redeemed in whole or in part.

 

Unless the Company defaults in payment of the redemption price, on and after any redemption date, interest will cease to accrue on the Bonds of Series WWW or portions thereof called for redemption.

 

The Company shall indemnify and hold harmless the Trustee from any and all losses, costs, damages, expenses, fees (including attorneys’ fees), court costs, judgments, penalties, obligations, suits, disbursements and liabilities of any kind or character whatsoever which may at any time be imposed upon, incurred by or asserted against the Trustee by reason of or arising out of or caused, directly or indirectly by any act or omission of the Trustee with respect to this Section 52, except for such that would arise out of the willful misconduct or gross negligence of the Trustee and except for costs and expenses arising in the ordinary course of the Trustee’s business.”

 

ARTICLE V.

 

CONCERNING THE TRUSTEE.

 

The Trustee hereby accepts the trusts hereby declared and agrees to perform the same upon the terms and conditions in the Indenture and in this Sixty-Sixth Supplemental Indenture set forth.  The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Sixty-Sixth Supplemental Indenture or the due execution hereof by the Company or for or in respect of the recitals contained herein, all of which recitals are made by the Company solely. In general, each and every term and condition contained in Article XVII of the Indenture shall apply to this Sixty-Sixth Supplemental Indenture.

 

33

 

ARTICLE VI.

 

MISCELLANEOUS PROVISIONS.

 

Section 1. Wherever in the original Indenture or in any of the sixty-six supplemental indentures thereto reference is made to any article or section of the original Indenture, such reference shall be deemed to refer to such article or section as amended by such supplemental indentures.

 

Section 2.  Upon the execution and delivery hereof, the Indenture shall thereupon be deemed to be amended as hereinabove set forth as fully and with the same effect as if the amendments made hereby were set forth in the original Indenture and each of the sixty-six supplemental indentures to the Indenture shall henceforth be read, taken and construed as one and the same instrument; but such amendments shall not operate so as to render invalid or improper any action heretofore taken under the original Indenture or said supplemental indentures.

 

Section 3. All the covenants, stipulations and agreements in this Sixty-Sixth Supplemental Indenture contained are and shall be for the sole and exclusive benefit of the parties hereto, their successors and assigns, and of the holders from time to time of the bonds.

 

Section 4.  The table of contents to, and the headings of the different articles of, this Sixty-Sixth Supplemental Indenture are inserted for convenience of reference, and are not to be taken to be any part of the provisions hereof, nor to control or affect the meaning, construction or effect of the same.

 

Section 5.  This Sixty-Sixth Supplemental Indenture may be simultaneously executed in any number of counterparts, and all such counterparts shall constitute but one and the same instrument.

 

Section 6.  Whenever a payment of principal or interest in respect of a Series of Bonds are due on any day other than a business day (as hereinafter defined), such payment shall be payable on the first business day next following such date, and, in the case of a principal payment, interest on such principal payment shall accrue to the date of such principal payment. For the purposes of this Section 6 the term business day shall mean any day other than a day on which the Trustee is authorized by law to close.

 

[THE REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY.]

 

34

 

IN WITNESS WHEREOF, said Duke Energy Indiana, Inc. has caused this instrument to be executed in its corporate name by its President or one of its Vice Presidents and to be attested by its Secretary or one of its Assistant Secretaries and said Deutsche Bank National Trust Company has caused this instrument to be executed in its corporate name by one of its Associates and to be attested by one of its Vice Presidents, in several counterparts, all as of the day and year first above written.

 

	
 
    	
DUKE ENERGY INDIANA, INC.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(CORPORATE SEAL)
    	
By
    	
/s/ Stephen G. De May
    
	
 
    	
 
    	
Stephen   G. De May
    
	
 
    	
 
    	
Vice   President and Treasurer
    
	
 
    	
 
    	
 
    
	
ATTEST:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/   Robert T. Lucas III
    	
 
    	
 
    	
 
    
	
Robert   T. Lucas III
    	
 
    	
 
    	
 
    
	
Assistant Corporate Secretary
    	
 
    	
 
    	
 
    

 

35

 

	
 
    	
DEUTSCHE   BANK NATIONAL TRUST COMPANY, as Trustee and as Calculation Agent and not in   its individual capacity
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(CORPORATE SEAL)
    	
By
    	
/s/ Chris Niesz
    
	
 
    	
 
    	
Chris   Niesz
    
	
 
    	
 
    	
Associate
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ATTEST:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
/s/   Irina Golovashchuk
    	
 
    	
 
    	
 
    
	
Irina   Golovashchuk, Vice President
    	
 
    	
 
    	
 
    

 

36

 

	
STATE   OF NORTH CAROLINA
    	
)
    
	
 
    	
)   ss:
    
	
COUNTY   OF MECKLENBURG
    	
)
    

 

BE IT REMEMBERED, that on this 11th day of July, 2013, before me, the undersigned, a notary public in and for the County and State aforesaid, duly commissioned and qualified, personally appeared Stephen G. De May and Robert T. Lucas III, personally known to me to be the same persons whose names are subscribed to the foregoing instrument, and personally known to me to be the Vice President and Treasurer and an Assistant Corporate Secretary, respectively, of Duke Energy Indiana, Inc., an Indiana corporation, and acknowledged that they signed and delivered said instrument as their free and voluntary act as such Vice President and Treasurer and Assistant Corporate Secretary, respectively, and as the free and voluntary act of said Duke Energy Indiana, Inc., for the uses and purposes therein set forth; in pursuance of the power and authority granted to them by resolution of the Board of Directors of said Company.

 

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal the day and year aforesaid.

 

(NOTARIAL SEAL)

 

 

	
 
    	
/s/   Patricia C. Ross
    
	
 
    	
Patricia C. Ross, Notary Public
    
	
 
    	
Commission expires: 10/17/2014
    

 

37

 

	
STATE   OF NEW JERSEY
    	
)
    
	
 
    	
)   ss:
    
	
COUNTY   OF HUDSON
    	
)
    

 

BE IT REMEMBERED, that on this 11th day of July, 2013, before me, the undersigned, a notary public in and for the County and State aforesaid, duly commissioned and qualified, personally appeared Chris Niesz and Irina Golovashchuk personally known to me to be the same persons whose names are subscribed to the foregoing instrument, and personally known to me to be an Associate and a Vice President, respectively, of Deutsche Bank National Trust Company, a national banking association, and acknowledged that they signed and delivered said instrument as their free and voluntary act as such Associate and Vice President, respectively, and as the free and voluntary act of said Deutsche Bank National Trust Company, for the uses and purposes therein set forth; in pursuance of the power and authority granted to them by the bylaws of said association.

 

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my notarial seal the day and year aforesaid.

 

(NOTARIAL SEAL)

 

 

	
 
    	
/s/   Michele H. Y. Voon
    
	
 
    	
Notary Public
    

 

 

This instrument was prepared by:

 

Bradley C. Arnett, Esq.*

Taft Stettinius & Hollister LLP

425 Walnut Street, Suite 1800

Cincinnati, Ohio  45202-3957

 

*Admitted in Ohio; not admitted in Indiana

 

38

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