Document:

bbbt_ex102.htm

EXHIBIT 10.2
  
 NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT OR OTHER APPLICABLE EXEMPTION. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.
  
 	 Principal Amount: US$70,000.00
	 Issue Date: June 27, 2022

	 Purchase Price: US$63,500.00
	  

  
 PROMISSORY NOTE
  
 FOR VALUE RECEIVED, BLACK BIRD BIOTECH INC., a Nevada corporation (hereinafter called the “Borrower”) (Trading Symbol: BBBT), hereby promises to pay to the order of GS CAPITAL PARTNERS, LLC, a Nevada limited liability company, or registered assigns (the “Holder”) the sum of US$70,000.00 (the “Principal”) together with guaranteed interest (the “Interest”) on the Principal balance hereof in the amount of twelve percent (12%) (the “Interest Rate”) per calendar year from the date hereof (the “Issue Date”). All Principal and Interest owing hereunder, along with any and all other amounts, shall be due and owing on June 27, 2023 (the “Maturity Date”). A lump-sum interest payment for twelve (12) months shall be immediately due on the Issue Date and shall be added to the principal balance and payable on the Maturity Date or upon acceleration or by prepayment or otherwise, notwithstanding the number of days which the Principal is outstanding. This note (the “Note”) shall contain an original issue discount of $6,500 resulting in a purchase price of $63,500. Principal payments shall be made in ten (10) installments each in the amount of US$7,840.00 commencing on the ninetieth (90th) day anniversary following the Issue Date and continuing thereafter each thirty (30) days for ten (10) months. Notwithstanding the forgoing, the final payment of Principal and Interest shall be due on the Maturity Date. This Note may be prepaid in whole or in part as set forth herein. Any amount of Principal or Interest on this Note which is not paid when due shall bear interest at the rate of the lesser of (i) twenty-four percent (24%) per annum and (ii) the maximum amount permitted under law from the due date thereof until the same is paid (the “Default Interest”). Default Interest shall commence accruing upon an Event of Default and shall be computed on the basis of a 360-day year and the actual number of days elapsed. All payments due hereunder (to the extent not converted into common stock, no par value per share (the “Common Stock”) in accordance with the terms hereof) shall be made in lawful money of the United States of America. All payments shall be made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a business day, the same shall instead be due on the next succeeding day which is a business day and, in the case of any interest payment date which is not the date on which this Note is paid in full, the extension of the due date thereof shall not be taken into account for purposes of determining the amount of interest due on such date. As used in this Note, the term “business day” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the city of New York, New York are authorized or required by law or executive order to remain closed. Each capitalized term used herein, and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase Agreement dated the date hereof, pursuant to which this Note was originally issued (the “Purchase Agreement”).
  
 	 
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 This Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.
  
 The following terms shall also apply to this Note:
  
 ARTICLE I. CONVERSION RIGHTS
  
 1.1 Conversion Right. The Holder shall have the right from time to time, and at any time following an Event of Default, and ending on the date of payment of the Default Amount (as defined in Article III) pursuant to Section 1.6(a) or Article III, each in respect of the remaining outstanding principal amount of this Note to convert all or any part of the outstanding and unpaid principal, interest, penalties, and all other amounts under this Note into fully paid and non- assessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified at the Conversion Price (as defined below) determined as provided herein (a “Conversion”); provided, however, that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso. The number of shares of Common Stock to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit A (the “Notice of Conversion”), delivered to the Borrower or Borrower’s transfer agent by the Holder in accordance with Section 1.4 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower or Borrower’s transfer agent before 11:59 p.m., New York, New York time on such conversion date (the “Conversion Date”). The term “Conversion Amount” means, with respect to any conversion of this Note, the sum of (1) the principal amount of this Note to be converted in such conversion plus (2) at the Holder’s option, accrued and unpaid interest, if any, on such principal amount at the interest rates provided in this Note to the Conversion Date, provided however, that the Borrower shall have the right to pay any or all interest in cash plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2) plus (4) at the Holder’s option, any amounts owed to the Holder pursuant to Sections 1.3 and 1.4(g) hereof.
  
 	 
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 1.2 Conversion Price.
  
 Calculation of Conversion Price. Subject to the adjustments described herein, the conversion price (the “Conversion Price”) shall be equal to 70% of the lowest trading price of the Company’s Common Stock for the 10 trading days immediately preceding the delivery of a notice of conversion resulting from such default. To the extent the Conversion Price of the Borrower’s Common Stock closes below the par value per share, the Borrower will take all steps necessary to solicit the consent of the stockholders to reduce the par value to the lowest value possible under law. The Borrower agrees to honor all conversions submitted pending this adjustment. If the shares of the Borrower’s Common Stock have not been delivered within three (3) business days to the Borrower or Borrower’s transfer agent, the Notice of Conversion may be rescinded. If the Trading Price cannot be calculated for such security on such date in the manner provided above, the Trading Price shall be the fair market value as mutually determined by the Borrower and the holders of a majority in interest of the Notes being converted for which the calculation of the Trading Price is required in order to determine the Conversion Price of such Notes. “Trading Day” shall mean any day on which the Common Stock is tradable for any period on the OTC Pink, OTCQB or on the principal securities exchange or other securities market on which the Common Stock is then being traded. The Borrower shall be responsible for the fees of its transfer agent and all DTC fees associated with any such issuance. Holder shall be entitled to deduct $750.00 from the conversion amount in each Notice of Conversion to cover Holder’s deposit fees associated with each Notice of Conversion.
  
 (a) Conversion Price During Major Announcements. Notwithstanding anything contained in Section 1.2(a) to the contrary, in the event the Borrower (i) makes a public announcement that it intends to consolidate or merge with any other corporation (other than a merger in which the Borrower is the surviving or continuing corporation and its capital stock is unchanged) or sell or transfer all or substantially all of the assets of the Borrower or (ii) any person, group or entity (including the Borrower) publicly announces a tender offer to purchase 50% or more of the Borrower’s Common Stock (or any other takeover scheme) (the date of the announcement referred to in clause (i) or (ii) is hereinafter referred to as the “Announcement Date”), then the Conversion Price shall, effective upon the Announcement Date and continuing through the Adjusted Conversion Price Termination Date (as defined below), be equal to the lower of (x) the Conversion Price which would have been applicable for a Conversion occurring on the Announcement Date and (y) the Conversion Price that would otherwise be in effect. From and after the Adjusted Conversion Price Termination Date, the Conversion Price shall be determined as set forth in this Section 1.2(a). For purposes hereof, “Adjusted Conversion Price Termination Date” shall mean, with respect to any proposed transaction or tender offer (or takeover scheme) for which a public announcement as contemplated by this Section 1.2(b) has been made, the date upon which the Borrower (in the case of clause (i) above) or the person, group or entity (in the case of clause (ii) above) consummates or publicly announces the termination or abandonment of the proposed transaction or tender offer (or takeover scheme) which caused this Section 1.2(b) to become operative.
  
 	 
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 (b) Pro Rata Conversion; Disputes. In the event of a dispute as to the number of shares of Common Stock issuable to the Holder in connection with a conversion of this Note, the Borrower shall issue to the Holder the number of shares of Common Stock not in dispute and resolve such dispute in accordance with Section 4.13.
  
 (c) If at any time the Conversion Price as determined hereunder for any conversion would be less than the par value of the Common Stock, then the Conversion Price hereunder shall equal such par value for such conversion and the Conversion Amount for such conversion shall be increased to include Additional Principal, where “Additional Principal” means such additional amount to be added to the Conversion Amount to the extent necessary to cause the number of conversion shares issuable upon such conversion to equal the same number of conversion shares as would have been issued had the Conversion Price not been subject to the minimum price set forth in this Section 1.2(c).
  
 1.3 Authorized Shares. The Borrower covenants that during the period while any outstanding balance is owing hereunder, the Borrower will reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance of Common Stock upon the full conversion of this Note. The Borrower is required at all times to have authorized and reserved four (4) times the number of shares that is actually issuable upon full conversion of the Note (based on the Conversion Price of the Notes in effect from time to time) initially 55,555,556 shares (the “Reserved Amount”). The Reserved Amount shall be increased from time to time in accordance with the Borrower’s obligations pursuant to Section 3(d) of the Purchase Agreement. The Borrower represents that upon issuance, such shares will be duly and validly issued, fully paid and non-assessable. In addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number of shares of Common Stock into which the Notes shall be convertible at the then current Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of the outstanding Notes. The Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Common Stock issuable upon conversion of this Note, and (ii) agrees that its issuance of this Note shall constitute full authority to its officers and agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for shares of Common Stock in accordance with the terms and conditions of this Note. Notwithstanding the foregoing, in no event shall the Reserved Amount be lower than the initial Reserved Amount, regardless of any prior conversions.
  
 If, at any time the Borrower does not maintain or replenish the Reserved Amount within three (3) business days of the request of the Holder, the principal amount of the Note shall increase by Five Thousand and No/100 United States Dollars ($5,000) (under Holder’s and Borrower’s expectation that any principal amount increase will tack back to the Issue Date) per occurrence.
  
 	 
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 1.4 Method of Conversion.
  
 (a) Mechanics of Conversion. Subject to Section 1.1, this Note may be converted by the Holder in whole or in part at any time from time to time after an Event of Default, by (A) submitting to the Borrower or Borrower’s transfer agent a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 11:59 p.m., New York, New York time) and (B) subject to Section 1.4(b), surrendering this Note at the principal office of the Borrower.
  
 (b) Surrender of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire unpaid principal amount of this Note is so converted. The Holder and the Borrower shall maintain records showing the principal amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to require physical surrender of this Note upon each such conversion. In the event of any dispute or discrepancy, such records of the Borrower shall, prima facie, be controlling and determinative in the absence of manifest error. Notwithstanding the foregoing, if any portion of this Note is converted as aforesaid, the Holder may not transfer this Note unless the Holder first physically surrenders this Note to the Borrower, whereupon the Borrower will forthwith issue and deliver upon the order of the Holder a new Note of like tenor, registered as the Holder (upon payment by the Holder of any applicable transfer taxes) may request, representing in the aggregate the remaining unpaid principal amount of this Note. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted principal amount of this Note represented by this Note may be less than the amount stated on the face hereof.
  
 (c) Payment of Taxes. The Borrower shall not be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock or other securities or property on conversion of this Note in a name other than that of the Holder (or in street name), and the Borrower shall not be required to issue or deliver any such shares or other securities or property unless and until the person or persons (other than the Holder or the custodian in whose street name such shares are to be held for the Holder’s account) requesting the issuance thereof shall have paid to the Borrower the amount of any such tax or shall have established to the satisfaction of the Borrower that such tax has been paid.
  
 (d) Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section 1.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid principal amount hereof, surrender of this Note) in accordance with the terms hereof and the Purchase Agreement.
  
 	 
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 (e) Obligation of Borrower to Deliver Common Stock. Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder of record of the Common Stock issuable upon such conversion, the outstanding principal amount and the amount of accrued and unpaid interest on this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations under this Article I, all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for Common Stock shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion. The Conversion Date specified in the Notice of Conversion shall be the Conversion Date so long as the Notice of Conversion is received by the Borrower before 11:59 p.m., New York, New York time, on such date.
  
 (f) Delivery of Common Stock by Electronic Transfer. In lieu of delivering physical certificates representing the Common Stock issuable upon conversion, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer (“FAST”) program, upon request of the Holder and its compliance with the provisions contained in Section 1.1 and in this Section 1.4, the Borrower shall use its commercially reasonable best efforts to cause its transfer agent to electronically transmit the Common Stock issuable upon conversion to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit Withdrawal At Custodian (“DWAC”) system.
  
 (g) DTC Eligibility & Market Loss. If the Borrower fails to maintain its status as “DTC Eligible” for any reason, the principal amount of the Note shall increase by Fifteen Thousand and No/100 United States Dollars ($15,000) (under Holder’s and Borrower’s expectation that any principal amount increase will tack back to the Issue Date).
  
 (h) Failure to Deliver Common Stock Prior to Delivery Deadline. Without in any way limiting the Holder’s right to pursue other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is not delivered by the Deadline (other than a failure due to the circumstances described in Section 1.3 above, which failure shall be governed by such Section) the Borrower shall pay to the Holder $2,000 per day in cash, for each day beyond the Deadline that the Borrower fails to deliver such Common Stock until the Borrower issues and delivers a certificate to the Holder or credit the Holder's balance account with OTC for the number of shares of Common Stock to which the Holder is entitled upon such Holder's conversion of any Conversion Amount (under Holder's and Borrower's expectation that any damages will tack back to the Issue Date).. Such cash amount shall be paid to Holder by the fifth day of the month following the month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common Stock in accordance with the terms of this Note. The Borrower agrees that the right to convert is a valuable right to the Holder. The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible to qualify. Accordingly, the parties acknowledge that the liquidated damages provision contained in this Section 1.4(h) are justified.
  
 	 
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 (i) Rescindment of a Notice of Conversion. If (i) the Borrower fails to respond to Holder within one (1) business day from the Conversion Date confirming the details of Notice of Conversion, (ii) the Borrower fails to provide any of the shares of the Borrower’s Common Stock requested in the Notice of Conversion within three (3) business days from the date of receipt of the Note of Conversion, (iii) the Holder is unable to procure a legal opinion required to have the shares of the Borrower’s Common Stock issued unrestricted and/or deposited to sell for any reason related to the Borrower’s standing, (iv) the Holder is unable to deposit the shares of the Borrower’s Common Stock requested in the Notice of Conversion for any reason related to the Borrower’s standing, (v) at any time after a missed Deadline, at the Holder’s sole discretion, or (vi) if OTC Markets changes the Borrower's designation to ‘Limited Information’ (Yield), ‘No Information’ (Stop Sign), ‘Caveat Emptor’ (Skull & Crossbones), ‘OTC’, ‘Other OTC’ or ‘Grey Market’ (Exclamation Mark Sign) or other trading restriction on the day of or any day after the Conversion Date, the Holder maintains the option and sole discretion to rescind the Notice of Conversion (“Rescindment”) with a “Notice of Rescindment.”
  
 1.5 Concerning the Shares. The shares of Common Stock issuable upon conversion of this Note may not be sold or transferred unless (i) such shares are sold pursuant to an effective registration statement under the Act or (ii) the Borrower or its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration or (iii) such shares are sold or transferred pursuant to Rule 144 under the Act (or a successor rule) (“Rule 144”) or other applicable exemption or (iv) such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise transfer the shares only in accordance with this Section 1.5 and who is an Accredited Investor (as defined in the Purchase Agreement). Except as otherwise provided in the Purchase Agreement (and subject to the removal provisions set forth below), until such time as the shares of Common Stock issuable upon conversion of this Note have been registered under the Act or otherwise may be sold pursuant to Rule 144 or other applicable exemption without any restriction as to the number of securities as of a particular date that can then be immediately sold, each certificate for shares of Common Stock issuable upon conversion of this Note that has not been so included in an effective registration statement or that has not been sold pursuant to an effective registration statement or an exemption that permits removal of the legend, shall bear a legend substantially in the following form, as appropriate:
  
 	 
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	 “NEITHER THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT OR OTHER APPLICABLE EXEMPTION. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.”
	  

  
 The legend set forth above shall be removed and the Borrower shall issue to the Holder a new certificate therefore free of any transfer legend if (i) the Borrower or its transfer agent shall have received an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Common Stock may be made without registration under the Act, which opinion shall be reasonably accepted by the Borrower so that the sale or transfer is effected or (ii) in the case of the Common Stock issuable upon conversion of this Note, such security is registered for sale by the Holder under an effective registration statement filed under the Act or otherwise may be sold pursuant to Rule 144 or other applicable exemption without any restriction as to the number of securities as of a particular date that can then be immediately sold. In the event that the Borrower does not accept the opinion of counsel provided by the Buyer with respect to the transfer of Securities pursuant to an exemption from registration, such as Rule 144 or Regulation S, at the Deadline, it will be considered an Event of Default pursuant to Section 3.2 of the Note.
  
 1.6 Effect of Certain Events.
  
 (a) Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially all of the assets of the Borrower, the effectuation by the Borrower of a transaction or series of related transactions in which more than 50% of the voting power of the Borrower is disposed of, or the consolidation, merger or other business combination of the Borrower with or into any other Person (as defined below) or Persons when the Borrower is not the survivor shall either: (i) be deemed to be an Event of Default (as defined in Article III) pursuant to which the Borrower shall be required to pay to the Holder upon the consummation of and as a condition to such transaction an amount equal to the Default Amount (as defined in Article III) or (ii) be treated pursuant to Section 1.6(b) hereof. “Person” shall mean any individual, corporation, limited liability company, partnership, association, trust or other entity or organization.
  
 	 
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 (b) Adjustment Due to Merger, Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion of all of the Notes, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar event, as a result of which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares of another class or classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of all or substantially all of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower, then the Holder of this Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and upon the terms and conditions specified herein and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion, such stock, securities or assets which the Holder would have been entitled to receive in such transaction had this Note been converted in full immediately prior to such transaction (without regard to any limitations on conversion set forth herein), and in any such case appropriate provisions shall be made with respect to the rights and interests of the Holder of this Note to the end that the provisions hereof (including, without limitation, provisions for adjustment of the Conversion Price and of the number of shares issuable upon conversion of the Note) shall thereafter be applicable, as nearly as may be practicable in relation to any securities or assets thereafter deliverable upon the conversion hereof. The Borrower shall not affect any transaction described in this Section 1.6(b) unless (a) it first gives, to the extent practicable, thirty (30) days prior written notice (but in any event at least fifteen (15) days prior written notice) of the record date of the special meeting of shareholders to approve, or if there is no such record date, the consummation of, such merger, consolidation, exchange of shares, recapitalization, reorganization or other similar event or sale of assets (during which time the Holder shall be entitled to convert this Note) and (b) the resulting successor or acquiring entity (if not the Borrower) assumes by written instrument the obligations of this Section 1.6(b). The above provisions shall similarly apply to successive consolidations, mergers, sales, transfers or share exchanges.
  
 (c) Adjustment Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire its assets) to holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any dividend or distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock of a subsidiary (i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion of this Note after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such assets which would have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had such Holder been the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to such Distribution.
  
 (d) Purchase Rights. If, at any time when any Notes are issued and outstanding, the Borrower issues any convertible securities or rights to purchase stock, warrants, securities or other property (the “Purchase Rights”) pro rata to the record holders of any class of Common Stock, then the Holder of this Note will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which such Holder could have acquired if such Holder had held the number of shares of Common Stock acquirable upon complete conversion of this Note (without regard to any limitations on conversion contained herein) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights or, if no such record is taken, the date as of which the record holders of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights.
  
 	 
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 (e) Notice of Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Price as a result of the events described in this Section 1.6, the Borrower, at its expense, shall promptly compute such adjustment or readjustment and prepare and furnish to the Holder a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Borrower shall, upon the written request at any time of the Holder, furnish to such Holder a like certificate setting forth (i) such adjustment or readjustment, (ii) the Conversion Price at the time in effect and (iii) the number of shares of Common Stock and the amount, if any, of other securities or property which at the time would be received upon conversion of the Note.
  
 1.7 Status as Shareholder. Upon submission of a Notice of Conversion by a Holder, (i) the shares covered thereby (other than the shares, if any, which cannot be issued because their issuance would exceed such Holder’s allocated portion of the Reserved Amount or Maximum Share Amount) shall be deemed converted into shares of Common Stock and (ii) the Holder’s rights as a Holder of such converted portion of this Note shall cease and terminate, excepting only the right to receive certificates for such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure by the Borrower to comply with the terms of this Note. Notwithstanding the foregoing, if a Holder has not received certificates for all shares of Common Stock prior to the tenth (10th) business day after the expiration of the Deadline with respect to a conversion of any portion of this Note for any reason, then (unless the Holder otherwise elects to retain its status as a holder of Common Stock by so notifying the Borrower) the Holder shall regain the rights of a Holder of this Note with respect to such unconverted portions of this Note and the Borrower shall, as soon as practicable, return such unconverted Note to the Holder or, if the Note has not been surrendered, adjust its records to reflect that such portion of this Note has not been converted. In all cases, the Holder shall retain all of its rights and remedies (including, without limitation, (i) the right to receive Conversion Default Payments pursuant to Section 1.3 to the extent required thereby for such Conversion Default and any subsequent Conversion Default and (ii) the right to have the Conversion Price with respect to subsequent conversions determined in accordance with Section 1.3) for the Borrower’s failure to convert this Note.
  
 1.8 Prepayment. Provided that an Event of Default has not occurred under this Note, the Borrower may prepay the amounts outstanding hereunder by paying an amount equal to the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount of this Note plus (y) Default Interest, if any.
  
 1.9 Any notice of prepayment hereunder (an “Optional Prepayment Notice”) shall be delivered to the Holder of the Note at its registered addresses by physical mail and shall state: (1) that the Borrower is requesting to prepay the Note, and (2) the date of the requested prepayment which shall be not more than three (3) Trading Days from the date of the Optional Prepayment Notice. On the date fixed for prepayment (the “Optional Prepayment Date”), the Borrower shall make payment of the applicable prepayment amount to or upon the order of the Holder as specified by the Holder in writing to the Borrower. If the Borrower delivers an Optional Prepayment Notice which has been consented to in writing by the Holder, and Borrower fails to pay the applicable prepayment amount due to the Holder of the Note within two (2) business days following the Optional Prepayment Date, the Borrower shall forever forfeit its right to request a prepayment pursuant to Section 1.8.
  
 	 
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 ARTICLE II. CERTAIN COVENANTS
  
 2.1 Distributions on Capital Stock. So long as the Borrower shall have any obligation under this Note, the Borrower shall not without the Holder’s written consent (a) pay, declare or set apart for such payment, any dividend or other distribution (whether in cash, property or other securities) on shares of capital stock other than dividends on shares of Common Stock solely in the form of additional shares of Common Stock or (b) directly or indirectly or through any subsidiary make any other payment or distribution in respect of its capital stock except for distributions pursuant to any shareholders’ rights plan which is approved by a majority of the Borrower’s disinterested directors.
  
 2.2 Restriction on Stock Repurchases. So long as the Borrower shall have any obligation under this Note, the Borrower shall not without the Holder’s written consent redeem, repurchase or otherwise acquire (whether for cash or in exchange for property or other securities or otherwise) in any one transaction or series of related transactions any shares of capital stock of the Borrower or any warrants, rights or options to purchase or acquire any such shares.
  
 2.3 Most Favored Nations Beginning on the Issuance Date of the Note and so long as the Borrower shall have any obligation under this Note, the Conversion Price and other terms will be adjusted on a ratchet basis if the Company offers a more favorable term such as Conversion Price, Interest Rate, (whether through a straight discount or in combination with an original issue discount) or other more favorable term to another party.
  
 2.4 Borrowings. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, create, incur, assume guarantee, endorse, contingently agree to purchase or otherwise become liable upon the obligation of any person, firm, partnership, joint venture or corporation, except by the endorsement of negotiable instruments for deposit or collection, or suffer to exist any liability for borrowed money, except (a) borrowings in existence or committed on the date hereof and of which the Borrower has informed Holder in writing prior to the date hereof, (b) indebtedness to trade creditors financial institutions or other lenders incurred in the ordinary course of business or (c) borrowings, the proceeds of which shall be used to repay this Note.
  
 2.5 Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary course of business. Any consent to the disposition of any assets shall be conditioned on a specified use of the proceeds towards the repayment of this Note.
  
 2.6 Advances and Loans. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the Holder’s written consent, lend money, give credit or make advances to any person, firm, joint venture or corporation, including, without limitation, officers, directors, employees, subsidiaries and affiliates of the Borrower, except loans, credits or advances (a) in existence or committed on the date hereof and which the Borrower has informed Holder in writing prior to the date hereof, (b) made in the ordinary course of business or (c) not in excess of $100,000.
  
 	 
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 2.7 Section 3(a)(9) or 3(a)(10) Transaction. So long as this Note is outstanding, the Borrower shall not enter into any transaction or arrangement structured in accordance with, based upon, or related or pursuant to, in whole or in part, either Section 3(a)(9) of the Securities Act (a “3(a)(9) Transaction”) or Section 3(a)(l0) of the Securities Act (a “3(a)(l0) Transaction”). In the event that the Borrower does enter into, or makes any issuance of Common Stock related to a 3(a)(9) Transaction or a 3(a)(l0) Transaction while this note is outstanding, a liquidated damages charge of 25% of the outstanding principal balance of this Note, but not less than Fifteen Thousand Dollars $15,000, will be assessed and will become immediately due and payable to the Holder at its election in the form of cash payment or addition to the balance of this Note.
  
 2.8 Preservation of Existence, etc. The Borrower shall maintain and preserve, and cause each of its Subsidiaries to maintain and preserve, its existence, rights and privileges, and become or remain, and cause each of its Subsidiaries (other than dormant Subsidiaries that have no or minimum assets) to become or remain, duly qualified and in good standing in each jurisdiction in which the character of the properties owned or leased by it or in which the transaction of its business makes such qualification necessary.
  
 2.9 Non-circumvention. The Borrower hereby covenants and agrees that the Borrower will not, by amendment of its Certificate or Articles of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Note, and will at all times in good faith carry out all the provisions of this Note and take all action as may be required to protect the rights of the Holder.
  
 2.9 Repayment from Proceeds. While any portion of this Note is outstanding, if the Company receives cash proceeds from any registration statement or the sale of any convertible securities, the Borrower shall, within one (1) business day of Borrower’s receipt of such proceeds, inform the Holder of such receipt, following which the Holder shall have the right in its sole discretion to require the Borrower to immediately apply up to 100% of such proceeds to repay all or any portion of the outstanding amounts owed under this Note. Failure of the Borrower to comply with this provision shall constitute an Event of Default.
  
 ARTICLE III. EVENTS OF DEFAULT
  
 If any of the following events of default (each, an “Event of Default”) shall occur:
  
 3.1 Failure to Pay Principal or Interest. The Borrower fails to pay the principal hereof or interest thereon when due on this Note, whether at maturity, upon acceleration or otherwise.
  
 	 
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 3.2 Conversion and the Shares. The Borrower (i) fails to issue shares of Common Stock to the Holder (or announces or threatens in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder in accordance with the terms of this Note, (ii) fails to transfer or cause its transfer agent to transfer (issue) (electronically or in certificated form) any certificate for shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, (iii) directs its transfer agent not to transfer or delays, impairs, and/or hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for shares of Common Stock to be issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, (iv) fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded in writing) for three (3) business days after the Holder shall have delivered a Notice of Conversion, (v) fails to remain current in its obligations to its transfer agent, (vi) causes a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent, (vii) fails to repay Holder, within forty eight (48) hours of a demand from the Holder, any amount of funds advanced by Holder to Borrower’s transfer agent in order to process a conversion, (viii) fails to reserve sufficient amount of shares of common stock to satisfy the Reserved Amount at all times, (ix) fails to provide a Rule 144 opinion letter from the Borrower’s legal counsel to the Holder, covering the Holder’s resale into the public market of the respective conversion shares under this Note, within two (2) business days of the Holder’s submission of a Notice of Conversion to the Borrower (provided that the Holder must request the opinion from the Borrower at the time that Holder submits the respective Notice of Conversion and the date of the respective Notice of Conversion must be on or after the date which is six (6) months after the date that the Holder funded the Purchase Price under this Note), and/or (x) an exemption under Rule 144 is unavailable for the Holder’s deposit into Holder’s brokerage account and resale into the public market of any of the conversion shares under this Note at any time after the date which is six (6) months after the date that the Holder funded the Purchase Price under this Note.
  
 3.3 Failure to Deliver Transaction Expense Amount. The Borrower fails to deliver the Transaction Expense Amount (as defined in the Purchase Agreement) to the Holder within three (3) business days of the date such amount is due.
  
 3.4 Breach of Covenants. The Borrower breaches any material covenant or other material term or condition contained in this Note and any collateral documents including but not limited to the Purchase Agreement and such breach continues for a period of ten (10) days after written notice thereof to the Borrower from the Holder.
  
 3.5 Breach of Representations and Warranties. Any representation or warranty of the Borrower made herein or in any agreement, statement or certificate given in writing pursuant hereto or in connection herewith (including, without limitation, the Purchase Agreement), shall be false or misleading in any material respect when made and the breach of which has (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.
  
 3.6 Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors or commence proceedings for its dissolution, or apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such a receiver or trustee shall otherwise be appointed for the Borrower or for a substantial part of its property or business without its consent and shall not be discharged within sixty (60) days after such appointment.
  
 	 
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 3.7 Judgments. Any money judgment, writ or similar process shall be entered or filed against the Borrower or any subsidiary of the Borrower or any of its property or other assets for more than $50,000, and shall remain unvacated, unbonded or unstayed for a period of twenty (20) days unless otherwise consented to by the Holder, which consent will not be unreasonably withheld.
  
 3.8 Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any subsidiary of the Borrower, or the Borrower admits in writing its inability to pay its debts generally as they mature, or have filed against it an involuntary petition for bankruptcy relief, all under federal or state laws as applicable or the Borrower admits in writing its inability to pay its debts generally as they mature, or have filed against it an involuntary petition for bankruptcy relief, all under international, federal or state laws as applicable.
  
 3.9 Delisting of Common Stock. The Borrower shall fail to maintain the listing of the Common Stock on at least one of the OTC Pink, OTCQB, Nasdaq National Market, Nasdaq Small Cap Market, New York Stock Exchange, NYSE MKT, or an equivalent replacement exchange.
  
 3.10 Failure to Comply with the Exchange Act. The Borrower shall fail to comply with the reporting requirements of the Exchange Act (including but not limited to becoming delinquent in its filings); and/or the Borrower shall cease to be subject to the reporting requirements of the Exchange Act.
  
 3.11 Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.
  
 3.12 Cessation of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise generally unable to pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.
  
 3.13 Maintenance of Assets. The failure by Borrower to maintain any material intellectual property rights, personal, real property or other assets which are necessary to conduct its business (whether now or in the future), or any disposition or conveyance of any material asset of the Borrower.
  
 3.14 Financial Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC for any date or period from two years prior to the Issue Date of this Note and until this Note is no longer outstanding, if the result of such restatement would, by comparison to the un-restated financial statement, have constituted a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement. The foregoing shall be inapplicable if the restatement is not due to any act(s) by the Borrower, but rather is an issue of the Borrower’s auditor choosing to use a different accounting method then was originally reported.
  
 	 
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 3.15 Reverse Splits. The Borrower effectuates a reverse split of its Common Stock without twenty (20) days prior written notice to the Holder.
  
 3.16 Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent, the Borrower fails to provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form as initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.
  
 3.17 Cessation of Trading. Any cessation of trading of the Common Stock on at least one of the OTC Pink, OTCQB, Nasdaq National Market, Nasdaq Small Cap Market, New York Stock Exchange, NYSE MKT, or an equivalent replacement exchange, and such cessation of trading shall continue for a period of five consecutive (5) Trading Days.
  
 3.18 Cross-Default. Notwithstanding anything to the contrary contained in this Note or the other related or companion documents, a breach or default by the Borrower of any covenant or other term or condition contained in any of the Other Agreements (as defined herein), after the passage of all applicable notice and cure or grace periods, shall, at the option of the Holder, be considered a default under this Note and the Other Agreements, in which event the Holder shall be entitled (but in no event required) to apply all rights and remedies of the Holder under the terms of this Note and the Other Agreements by reason of a default under said Other Agreement or hereunder. “Other Agreements” means, collectively, all agreements and instruments between, among or by: (1) the Borrower, and, or for the benefit of, (2) the Holder (and any affiliate of the Holder) or any other third party, including, without limitation, promissory notes; provided, however, the term “Other Agreements” shall not include the agreements and instruments defined as the Documents. Each of the loan transactions will be cross-defaulted with each other loan transaction and with all other existing and future debt of Borrower to the Holder.
  
 3.19 Bid Price. The Borrower shall lose the “bid” price for its Common Stock ($0.0001 on the “Ask” with zero market makers on the “Bid” per Level 2) and/or a market (including the OTC Pink, OTCQB or an equivalent replacement exchange).
  
 3.20 OTC Markets Designation. OTC Markets changes the Borrower’s designation to ‘Caveat Emptor’ (Skull and Crossbones), or ‘OTC’, ‘Other OTC’ or ‘Grey Market’ (Exclamation Mark Sign).
  
 3.21 Inside Information. Any attempt by the Borrower or its officers, directors, and/or affiliates to transmit, convey, disclose, or any actual transmittal, conveyance, or disclosure by the Borrower or its officers, directors, and/or affiliates of, material non-public information concerning the Borrower, to the Holder or its successors and assigns, which is not immediately cured by Borrower’s filing of a Form 8-K pursuant to Regulation FD on that same date.
  
 	 
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 3.22 Unavailability of Rule 144. If, at any time on or after the date which is six (6) months after the Issue Date, the Holder is unable to (i) obtain a standard “144 legal opinion letter” from an attorney reasonably acceptable to the Holder, the Holder’s brokerage firm (and respective clearing firm), and the Borrower’s transfer agent in order to facilitate the Holder’s conversion of any portion of the Note into free trading shares of the Borrower’s Common Stock pursuant to Rule 144, and (ii) thereupon deposit such shares into the Holder’s brokerage account.
  
 3.23 Delisting or Suspension of Trading of Common Stock. If, at any time on or after the Issue Date, the Borrower’s Common Stock (i) is suspended from trading, (ii) halted from trading, and/or (iii) fails to be quoted or listed (as applicable) on any level of the OTC Markets, any tier of the NASDAQ Stock Market, the New York Stock Exchange, or the NYSE American.
  
 UPON THE OCCURRENCE OF ANY EVENT OF DEFAULT SPECIFIED IN SECTION 3 OF THIS NOTE, THE NOTE SHALL BECOME IMMEDIATELY AND AUTOMATICALLY DUE AND PAYABLE WITHOUT DEMAND, PRESENTMENT, OR NOTICE AND THE BORROWER SHALL PAY TO THE HOLDER, IN FULL SATISFACTION OF ITS OBLIGATIONS HEREUNDER, AN AMOUNT EQUAL TO: (A) IN THE EVENT OF AN OCCURRENCE OF ANY EVENT OF DEFAULT, THE THEN OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE PLUS (X) ACCRUED AND UNPAID INTEREST ON THE UNPAID PRINCIPAL AMOUNT OF THIS NOTE TO THE DATE OF PAYMENT (THE “MANDATORY PREPAYMENT DATE”) PLUS (Y) DEFAULT INTEREST, IF ANY, ON THE AMOUNTS REFERRED TO IN CLAUSES (W) AND/OR (X) PLUS (Z) ANY AMOUNTS OWED TO THE HOLDER PURSUANT TO SECTIONS 1.3 AND 1.4(G) HEREOF, MULTIPLED BY ONE POINT TWO (120%).
  
 The Holder shall have the right at any time after an Event of Default occurs under this Note to require the Borrower, to immediately issue, in lieu of the Default Amount and/or Default Sum, the number of shares of Common Stock of the Borrower equal to the Default Amount and/or Default Sum divided by the Conversion Price then in effect, pursuant to the terms of this Note (including but not limited to any beneficial ownership limitations contained herein). This requirement by the Borrower shall automatically apply upon the occurrence of an Event of Default without the need for any party to give any notice or take any other action.
  
 If the Holder shall commence an action or proceeding to enforce any provisions of this Note, including, without limitation, engaging an attorney, then if the Holder prevails in such action, the Holder shall be reimbursed by the Borrower for its attorneys' fees and other costs and expenses incurred in the investigation, preparation and prosecution of such action or proceeding.
  
 ARTICLE IV. MISCELLANEOUS
  
 4.1 Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privileges. All rights and remedies existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.
  
 	 
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 4.2 Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, electronic mail, or facsimile, addressed as set forth below or to such other address as such party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery or delivery by electronic mail or facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be:
  
 If to the Borrower, to:
  
 BLACK BIRD BIOTECH INC
 3505 Yucca Drive, Suite 104
 Flower Mound, TX 75028
 Attn: Fabian G. Deneault
 E-mail: eric@newlanpllc.com
  
 If to the Holder:
  
 GS CAPITAL PARTNERS, LLC
 1 East Liberty Street Suite 600
 Reno, Nevada 89501
 Attn: Gabe Sayegh
  
 4.3 Amendments. This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and the Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument (and the other Notes issued pursuant to the Purchase Agreement) as originally executed, or if later amended or supplemented, then as so amended or supplemented.
  
 4.4 Assignability. This Note shall be binding upon the Borrower and its successors and assigns and shall inure to be the benefit of the Holder and its successors and assigns. Neither the Borrower nor the Holder shall assign this Note or any rights or obligations hereunder without the prior written consent of the other. Notwithstanding the foregoing, the Holder may assign its rights hereunder to any “accredited investor” (as defined in Rule 501(a) of the 1933 Act) in a private transaction from the Holder or to any of its “affiliates”, as that term is defined under the 1934 Act, without the consent of the Borrower. Notwithstanding anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other lending arrangement. The Holder and any assignee, by acceptance of this Note, acknowledge and agree that following conversion of a portion of this Note, the unpaid and unconverted principal amount of this Note represented by this Note may be less than the amount stated on the face hereof.
  
 	 
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 4.5 Cost of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof reasonable costs of collection, including reasonable attorneys’ fees.
  
 4.6 Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of Nevada without regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated by this Agreement shall be brought only in the state courts of Nevada or in the federal courts located in the state Nevada and county or city of either Washoe County, Nevada or Clark County, Nevada. The parties to this Note hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. THE BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS NOTE OR ANY TRANSACTION CONTEMPLATED HEREBY. The prevailing party shall be entitled to recover from the other party its reasonable attorney's fees and costs. In the event that any provision of this Note or any other agreement delivered in connection herewith is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement. Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding in connection with this Agreement or any other Transaction Document by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law.
  
 4.7 Certain Amounts. Whenever pursuant to this Note the Borrower is required to pay an amount in excess of the outstanding principal amount (or the portion thereof required to be paid at that time) plus accrued and unpaid interest plus Default Interest on such interest, the Borrower and the Holder agree that the actual damages to the Holder from the receipt of cash payment on this Note may be difficult to determine and the amount to be so paid by the Borrower represents stipulated damages and not a penalty and is intended to compensate the Holder in part for loss of the opportunity to convert this Note and to earn a return from the sale of shares of Common Stock acquired upon conversion of this Note at a price in excess of the price paid for such shares pursuant to this Note. The Borrower and the Holder hereby agree that such amount of stipulated damages is not plainly disproportionate to the possible loss to the Holder from the receipt of a cash payment without the opportunity to convert this Note into shares of Common Stock.
  
 	 
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 4.8 Purchase Agreement. By its acceptance of this Note, each party agrees to be bound by the applicable terms of the Purchase Agreement.
  
 4.9 Notice of Corporate Events. Except as otherwise provided below, the Holder of this Note shall have no rights as a Holder of Common Stock unless and only to the extent that it converts this Note into Common Stock. The Borrower shall provide the Holder with prior notification of any meeting of the Borrower’s shareholders (and copies of proxy materials and other information sent to shareholders). In the event of any taking by the Borrower of a record of its shareholders for the purpose of determining shareholders who are entitled to receive payment of any dividend or other distribution, any right to subscribe for, purchase or otherwise acquire (including by way of merger, consolidation, reclassification or recapitalization) any share of any class or any other securities or property, or to receive any other right, or for the purpose of determining shareholders who are entitled to vote in connection with any proposed sale, lease or conveyance of all or substantially all of the assets of the Borrower or any proposed liquidation, dissolution or winding up of the Borrower, the Borrower shall mail a notice to the Holder, at least twenty (20) days prior to the record date specified therein (or thirty (30) days prior to the consummation of the transaction or event, whichever is earlier), of the date on which any such record is to be taken for the purpose of such dividend, distribution, right or other event, and a brief statement regarding the amount and character of such dividend, distribution, right or other event to the extent known at such time. The Borrower shall make a public announcement of any event requiring notification to the Holder hereunder substantially simultaneously with the notification to the Holder in accordance with the terms of this Section 4.9 including, but not limited to, name changes, recapitalizations, etc. as soon as possible under law.
  
 4.10 Usury. If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable provision shall automatically be revised to equal the maximum rate of interest or other amount deemed interest permitted under applicable law. The Borrower covenants (to the extent that it may lawfully do so) that it will not seek to claim or take advantage of any law that would prohibit or forgive the Borrower from paying all or a portion of the principal or interest on this Note.
  
 4.11 Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without any bond or other security being required. No provision of this Note shall alter or impair the obligation of the Borrower, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place, and rate, and in the form, herein prescribed.
  
 	 
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 4.12 Severability. In the event that any provision of this Note is invalid or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any provision hereof which may prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision hereof.
  
 4.13 Dispute Resolution. In the case of a dispute as to the determination of the Conversion Price, Conversion Amount, any prepayment amount or Default Amount, Default Sum, Closing or Maturity Date, the closing bid price, or fair market value (as the case may be) or the arithmetic calculation of the Conversion Price or the applicable prepayment amount(s) (as the case may be), the Borrower or the Holder shall submit the disputed determinations or arithmetic calculations via facsimile (i) within two (2) Business Days after receipt of the applicable notice giving rise to such dispute to the Borrower or the Holder or (ii) if no notice gave rise to such dispute, at any time after the Holder learned of the circumstances giving rise to such dispute. If the Holder and the Borrower are unable to agree upon such determination or calculation within two (2) Business Days of such disputed determination or arithmetic calculation (as the case may be) being submitted to the Borrower or the Holder, then the Borrower shall, within two (2) Business Days, submit via facsimile (a) the disputed determination of the Conversion Price, the closing bid price, the or fair market value (as the case may be) to an independent, reputable investment bank selected by the Borrower and approved by the Holder or (b) the disputed arithmetic calculation of the Conversion Price, Conversion Amount, any prepayment amount or Default Amount, Default Sum to an independent, outside accountant selected by the Holder that is reasonably acceptable to the Borrower. The Borrower shall cause at its expense the investment bank or the accountant to perform the determinations or calculations and notify the Borrower and the Holder of the results no later than ten (10) Business Days from the time it receives such disputed determinations or calculations. Such investment bank’s or accountant’s determination or calculation shall be binding upon all parties absent demonstrable error.
  
 4.16 Future Raises; Repayment from Proceeds. Until the Note is satisfied in full, if the Borrower receives cash proceeds from any source or series of related or unrelated sources, including but not limited to, from the issuance of equity and/or debt securities, the conversion of outstanding warrants of the Borrower, the issuance of securities pursuant to an equity line of credit of the Borrower or the sale of assets, the Borrower shall, within one (1) business day of Borrower’s receipt of such proceeds, inform the Holder of such receipt, following which the Holder shall have the right in its sole discretion to require the Borrower to immediately apply up to 100% of such proceeds to repay all or any portion of this Note. Failure of the Borrower to comply with this provision shall constitute an Event of Default under Section 3.4 of the Note. In the event that such proceeds are received by the Holder prior to the Maturity Date, the required prepayment shall be subject to the terms of Section 1.8 herein.
  
 [signature page follows]
  
 	 
	20
	

	 

  
 IN WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer as of the date first above written.
  
 	 	 BLACK BIRD BIOTECH INC.
	
	 	 	 	 
		By:	 
	
	  
	 Name:
	Fabian G. Deneault	 
	 	Title:	President	 

  
 	 
	21
	

	 

  
 EXHIBIT A
 NOTICE OF CONVERSION
  
 The undersigned hereby elects to convert $_______________principal amount of the Note (defined below) together with $______________of accrued and unpaid interest thereto, totaling $___________into that number of shares of Common Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of BLACK BIRD BIOTECH INC., a Delaware corporation (the “Borrower”), according to the conditions of the convertible note of the Borrower dated as of _____________ (the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion, except for transfer taxes, if any.
  
 Box Checked as to applicable instructions:
  
 	  
	 [  ]
	 The Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal At Custodian system (“DWAC Transfer”).

	  
	  
	  

	  
	  
	 Name of DTC Prime Broker:
 Account Number:

	  
	  
	  

	  
	 [  ]
	 The undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto:

   
 	  
	 Name: [NAME]
	  

	  
	 Address: [ADDRESS]
	  

	  
	  
	  

	  
	 Date of Conversion:
	 ________________

	  
	 Applicable Conversion Price:
	 $_______________

	  
	 Number of Shares of Common Stock to be Issued
 Pursuant to Conversion of the Notes: 
	  
 ________________

	  
	 Amount of Principal Balance Due remaining
 Under the Note after this conversion: 
	 ________________

	  
	 Accrued and unpaid interest remaining: 
	 ________________

  
 	 [HOLDER]
	
	 	 	 
	By:	 	
	 Name:
	[NAME]	 
	Title:	[TITLE]	 
	Date:	[DATE]	 

  
 	 
	22exc-20220823ex41

       Prepared by, Record and Return to:    Patrick R. Gillard   Ballard Spahr LLP   1735 Market Street, 51st Floor   Philadelphia, PA 19103   (215) 864-8536    Counterpart ______ of 30  PECO ENERGY COMPANY  TO  U.S. BANK NATIONAL ASSOCIATION, TRUSTEE  ______________________    ONE HUNDRED AND TWENTY-SECOND SUPPLEMENTAL   INDENTURE DATED AS OF   AUGUST 1, 2022    TO  FIRST AND REFUNDING MORTGAGE  OF  THE COUNTIES GAS AND ELECTRIC   COMPANY  TO  FIDELITY TRUST COMPANY, TRUSTEE  DATED MAY 1, 1923  __________________  4.375% SERIES DUE 2052  (New Series)    

 

   1  THIS SUPPLEMENTAL INDENTURE dated as of August 1, 2022 by and between PECO  ENERGY COMPANY, a corporation organized and existing under the laws of the Commonwealth  of Pennsylvania (hereinafter called the Company), party of the first part, and U.S. BANK  NATIONAL ASSOCIATION, a national banking association organized and existing under the  laws of the United States of America (hereinafter called the Trustee), as Trustee under the  Mortgage hereinafter mentioned, party of the second part, Witnesseth that  WHEREAS, The Counties Gas and Electric Company (hereinafter called Counties  Company), a Pennsylvania corporation and a predecessor to the Company, duly executed and  delivered to Fidelity Trust Company, a Pennsylvania corporation to which the Trustee is successor,  as Trustee, a certain indenture of mortgage and deed of trust dated May 1, 1923 (hereinafter called  the Mortgage), to provide for the issue of, and to secure, its First and Refunding Mortgage Bonds,  issuable in series and without limit as to principal amount except as provided in the Mortgage, the  initial series of Bonds being designated the 6% Series of 1923, and the terms and provisions of  other series of bonds secured by the Mortgage to be determined as provided in the Mortgage; and   WHEREAS, thereafter Counties Company, Philadelphia Suburban-Counties Gas and  Electric Company (hereinafter called Suburban Company), and the Company, respectively, have  from time to time executed and delivered indentures supplemental to the Mortgage, providing for  the creation of additional series of bonds secured by the Mortgage and for amendment of certain  of the terms and provisions of the Mortgage and of indentures supplemental thereto, or evidencing  the succession of Suburban Company to Counties Company and of the Company to Suburban  Company, such indentures supplemental to the Mortgage, the respective dates, parties thereto, and  purposes thereof, being as follows:     

 

   2  Supplemental Indenture     and Date  Parties Providing for:  First  September 1, 1926  Counties Company to   Fidelity-Philadelphia  Trust Company  (Successor to Fidelity  Trust Company)  Bonds of 5% Series of  1926  Second  May 1, 1927  Suburban Company to   Fidelity-Philadelphia  Trust Company  Evidencing succession of   Suburban Company to   Counties Company   Third  May 1, 1927  Suburban Company to   Fidelity-Philadelphia  Trust Company  Bonds of 4-1/2% Series  due 1957; amendment of  certain provisions of   Mortgage  Fourth  November 1, 1927  Suburban Company to   Fidelity-Philadelphia  Trust Company  Additional Bonds of   4-1/2% Series due 1957  Fifth  January 31, 1931  Company to   Fidelity-Philadelphia  Trust Company  Evidencing succession of   Company to   Suburban Company  Sixth  February 1, 1931  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 4% Series   due 1971  Seventh  March 1, 1937  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 3-1/2% Series   due 1967; amendment of  certain provisions of   Mortgage  Eighth  December 1, 1941  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 2-3/4% Series  due 1971; amendment of  certain provisions of  Mortgage  Ninth  November 1, 1944  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 2-3/4% Series   due 1967 and 2-3/4% Series   due 1974; amendment of   certain provisions of   Mortgage  

 

   3  Supplemental Indenture     and Date  Parties Providing for:  Tenth  December 1, 1946  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 2-3/4% Series   due 1981; amendment of   certain provisions of   Mortgage*  Eleventh  February 1, 1948  Company to  Fidelity-Philadelphia  Trust Company  Bonds of 2-7/8% Series  due 1978*  Twelfth  January 1, 1952  Company to  Fidelity-Philadelphia  Trust Company  Bonds of 3-1/4% Series  due 1982*  Thirteenth  May 1, 1953  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 3-7/8% Series  due 1983*  Fourteenth  December 1, 1953  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 3-1/8% Series  due 1983*  Fifteenth  April 1, 1955  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 3-1/8% Series  due 1985*  Sixteenth  September 1, 1957  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 4-5/8% Series  due 1987; amendment of  certain provisions of  Mortgage*  Seventeenth  May 1, 1958  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 3-3/4% Series  due 1988; amendment of  certain provisions of  Mortgage*  Eighteenth  December 1, 1958  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 4-3/8% Series  due 1986*  Nineteenth  October 1, 1959  Company to   Fidelity-Philadelphia  Trust Company  Bonds of 5% Series  due 1989*  

 

   4  Supplemental Indenture     and Date  Parties Providing for:  Twentieth  May 1, 1964  Company to  Fidelity-Philadelphia  Trust Company  Bonds of 4-1/2% Series  due 1994*  Twenty-first  October 15, 1966  Company to  Fidelity-Philadelphia  Trust Company  Bonds of 6% Series due  1968-1973*  Twenty-second  June 1, 1967  Company to The Fidelity  Bank (formerly   Fidelity-Philadelphia  Trust Company)   Bonds of 5-1/4 % Series due  1968-1973 and 5-3/4 %   Series due 1977*  Twenty-third  October 1, 1957  Company to The Fidelity   Bank  Bonds of 6-1/8 % Series   due 1997*  Twenty-fourth  March 1, 1968  Company to The Fidelity   Bank  Bonds of 6-1/2% Series  due 1993; amendment of   Article XIV of  Mortgage*  Twenty-fifth  September 10, 1968  Company to The Fidelity   Bank  Bonds of 1968 Series due  1969-1976*  Twenty-sixth  August 15, 1969  Company to The Fidelity   Bank  Bonds of 8% Series due  1975*  Twenty-seventh  February 1, 1970  Company to The Fidelity   Bank  Bonds of 9% Series due  1995*  Twenty-eighth  May 1, 1970  Company to The Fidelity   Bank  Bonds of 8-1/2% Series   due 1976*  Twenty-ninth  December 15, 1970  Company to The Fidelity   Bank  Bonds of 7-3/4% Series   due 2000*  Thirtieth  August 1, 1971  Company to The Fidelity   Bank  Bonds of 8-1/4% Series   due 1996*  Thirty-first  December 15, 1971   Company to The Fidelity   Bank  Bonds of 7-3/8% Series   due 2001; amendment of   Article XI of Mortgage*  

 

   5  Supplemental Indenture     and Date  Parties Providing for:  Thirty-second  June 15, 1972  Company to The Fidelity   Bank  Bonds of 7-1/2% Series  due 1998*  Thirty-third  January 15, 1973  Company to The Fidelity   Bank  Bonds of 7-1/2% Series  due 1999*  Thirty-fourth  January 15, 1974  Company to The Fidelity   Bank  Bonds of 8-1/2% Series  due 2004  Thirty-fifth  October 15, 1974  Company to The Fidelity   Bank  Bonds of 11% Series  due 1980*  Thirty-sixth  April 15, 1975  Company to The Fidelity   Bank  Bonds of 11-5/8% Series  due 2000*  Thirty-seventh  August 1, 1975  Company to The Fidelity   Bank  Bonds of 11% Series due  2000*  Thirty-eighth  March 1, 1976  Company to The Fidelity   Bank  Bonds of 9-1/8% Series  due 2006*  Thirty-ninth  August 1, 1976  Company to The Fidelity   Bank  Bonds of 9-5/8% Series  due 2002*  Fortieth  February 1, 1977  Company to The Fidelity   Bank  Bonds of Pollution  Control Series A  and Pollution  Control Series B*  Forty-first  March 15, 1977  Company to The Fidelity   Bank  Bonds of 8-5/8% Series  due 2007*  Forty-second  July 15, 1977  Company to The Fidelity   Bank  Bonds of 8-5/8% Series  due 2003*  Forty-third  March 15, 1978  Company to The Fidelity   Bank  Bonds of 9-1/8% Series  due 2008*  Forty-fourth  October 15, 1979  Company to The Fidelity   Bank  Bonds of 12-1/2% Series  due 2005*  Forty-fifth  October 15, 1980  Company to The Fidelity   Bank  Bonds of 13-3/4% Series  due 1992*  

 

   6  Supplemental Indenture     and Date  Parties Providing for:  Forty-sixth  March 1, 1981  Company to The Fidelity   Bank  Bonds of 15-1/4% Series  due 1996; amendment of  Article VIII of  Mortgage*  Forty-seventh  March 1, 1981  Company to The Fidelity   Bank  Bonds of 15% Series due  1996; amendment of  Article VIII of   Mortgage*  Forty-eighth  July 1, 1981  Company to The Fidelity   Bank  Bonds of 17-5/8% Series  due 2011*  Forty-ninth  September 15, 1981  Company to The Fidelity   Bank  Bonds of 18-3/4% Series  due 2009*  Fiftieth  April 1, 1982  Company to The Fidelity   Bank  Bonds of 18% Series due  2012*  Fifty-first  October 1, 1982  Company to The Fidelity   Bank  Bonds of 15-3/8% Series  due 2010*  Fifty-second  June 15, 1983  Company to The Fidelity   Bank  Bonds of 13-3/8% Series  due 2013*  Fifty-third  November 15, 1984  Company to Fidelity Bank,   National Association   (formerly The Fidelity Bank)  Bonds of 13.05% Series  due 1994; amendment  of Article VIII of  Mortgage*  Fifty-fourth  December 1, 1984  Company to Fidelity Bank,   National Association  Bonds of 14% Series due  1988-1994; amendment  of Article VIII of  Mortgage*  Fifty-fifth  May 15, 1985  Company to Fidelity Bank,   National Association  Bonds of Pollution  Control Series C*  Fifty-sixth  October 1, 1985  Company to Fidelity Bank,   National Association  Bonds of Pollution  Control Series D*  Fifty-seventh  November 15, 1985  Company to Fidelity Bank,   National Association  Bonds of 10-7/8% Series  due 1995*  

 

   7  Supplemental Indenture     and Date  Parties Providing for:  Fifty-eight  November 15, 1985  Company to Fidelity Bank,   National Association  Bonds of 11-3/4% Series  due 2014*  Fifty-ninth  June 1, 1986  Company to Fidelity Bank,   National Association  Bonds of Pollution  Control Series E*  Sixtieth  November 1, 1986  Company to Fidelity Bank,   National Association  Bonds of 10-1/4% Series  due 2016*  Sixty-first  November 1, 1986  Company to Fidelity Bank,   National Association  Bonds of 8-3/4% Series  due 1994*  Sixty-second  April 1, 1987  Company to Fidelity Bank,   National Association  Bonds of 9-3/8% Series  due 2017*  Sixty-third  July 15, 1987  Company to Fidelity Bank,   National Association  Bonds of 11% Series due  2016*  Sixty-fourth  July 15, 1987  Company to Fidelity Bank,   National Association  Bonds of 10% Series due  1997*  Sixty-fifth  August 1, 1987  Company to Fidelity Bank,   National Association  Bonds of 10-1/4% Series  due 2007*  Sixty-sixth  October 15, 1987  Company to Fidelity Bank,   National Association  Bonds of 11% Series due  1997*  Sixty-seventh  October 15, 1987  Company to Fidelity Bank,   National Association  Bonds of 12-1/8% Series  due 2016*  Sixty-eighth  April 15, 1988  Company to Fidelity Bank,   National Association  Bonds of 10% Series due  1998*  Sixty-ninth  April 15, 1988  Company to Fidelity Bank,   National Association  Bonds of 11% Series due  2018*  Seventieth  June 15, 1989  Company to Fidelity Bank,   National Association  Bonds of 10% Series due  2019*  Seventy-first  October 1, 1989  Company to Fidelity Bank,   National Association  Bonds of 9-7/8% Series  due 2019*  Seventy-second  October 1, 1989  Company to Fidelity Bank,   National Association  Bonds of 9-1/4% Series  due 1999*  

 

   8  Supplemental Indenture     and Date  Parties Providing for:  Seventy-third  October 1, 1989  Company to Fidelity Bank,   National Association  Medium-Term Note  Series A*  Seventy-fourth  October 15, 1990  Company to Fidelity Bank,   National Association  Bonds of 10-1/2% Series  due 2020*  Seventy-fifth  October 15, 1990  Company to Fidelity Bank,   National Association  Bonds of 10% Series due  2000*  Seventy-sixth  April 1, 1991  Company to Fidelity Bank,   National Association  Bonds of Pollution  Control Series F  and Pollution  Control Series G*  Seventy-seventh  December 1, 1991  Company to Fidelity Bank,   National Association  Bonds of Pollution  Control Series H*  Seventy-eighth  January 15, 1992  Company to Fidelity Bank,   National Association  Bonds of 7-1/2% 1992  Series due 1999*  Seventy-ninth  April 1, 1992  Company to Fidelity Bank,   National Association  Bonds of 8% Series due  2002*  Eightieth  April 1, 1992  Company to Fidelity Bank,   National Association  Bonds of 8-3/4% Series  due 2022*  Eighty-first  June 1, 1992  Company to Fidelity Bank,   National Association  Bonds of Pollution  Control Series I*  Eighty-second  June 1, 1992  Company to Fidelity Bank,   National Association  Bonds of 8-5/8% Series  due 2022*  Eighty-third  July 15, 1992  Company to Fidelity Bank,   National Association  Bonds of 7-1/2% Series  due 2002*  Eighty-fourth  September 1, 1992  Company to Fidelity Bank,   National Association  Bonds of 8-1/4% Series  due 2022*  Eighty-fifth  September 1, 1992  Company to Fidelity Bank,   National Association  Bonds of 7-1/8% Series  due 2002*  Eighty-sixth  March 1, 1993  Company to Fidelity Bank,   National Association  Bonds of 6-5/8% Series  due 2003*  

 

   9  Supplemental Indenture     and Date  Parties Providing for:  Eighty-Seventh  March 1, 1993  Company to Fidelity Bank,   National Association  Bonds of 7-3/4% Series  due 2023*  Eighty-eighth  March 1, 1993  Company to Fidelity Bank,   National Association  Bonds of Pollution  Control Series J,  Pollution Control  Series K, Pollution  Control Series L  and Pollution Control  Series M*  Eighty-ninth  May 1, 1993  Company to Fidelity Bank,   National Association  Bonds of 6-1/2% Series  due 2003*  Ninetieth  May 1, 1993  Company to Fidelity Bank,   National Association  Bonds of 7-3/4% Series  2 due 2023*  Ninety-first  August 15, 1993  Company to First Fidelity  Bank,   N.A., Pennsylvania  Bonds of 7-1/8% Series  due 2023*  Ninety-second  August 15, 1993  Company to First Fidelity  Bank,   N.A., Pennsylvania  Bonds of 6-3/8% Series  due 2005*  Ninety-third  August 15, 1993  Company to First Fidelity  Bank,   N.A., Pennsylvania  Bonds of 5-3/8% Series  due 1998*  Ninety-fourth  November 1, 1993  Company to First Fidelity  Bank,   N.A., Pennsylvania  Bonds of 7-1/4% Series  due 2024*  Ninety-fifth  November 1, 1993  Company to First Fidelity  Bank,   N.A., Pennsylvania  Bonds of 5-5/8% Series  due 2001*  Ninety-sixth  May 1, 1995  Company to First Fidelity  Bank,  N.A., Pennsylvania  Medium Term Note Series B*  

 

   10  Supplemental Indenture     and Date  Parties Providing for:  Ninety-seventh  October 15, 2001  Company to First Union  National Bank (formerly First  Fidelity Bank, N.A.,  Pennsylvania)  Bonds of  5.95% Series   due 2011*  Ninety-eighth  October 1, 2002  Company to Wachovia Bank,  National Association   Bonds of 5.95% Series  Due 2011*  Ninety-ninth  September 15, 2002  Company to Wachovia Bank,  National Association   Bonds of 4.75% Series  Due 2012*  One Hundredth   April 15, 2003  Company to Wachovia Bank,  National Association   Bonds of 3.50% Series  Due 2008*  One Hundred and First  April 15, 2004  Company to Wachovia Bank,  National Association   Bonds of 5.90% Series  Due 2034*  One Hundred and Second  September 15, 2006  Company to Wachovia Bank,  National Association   Bonds of 5.95% Series  Due 2036; amendment of  certain provisions of  Mortgage*    One Hundred and Third  March 15, 2007  Company to U.S. Bank  National Association   Bonds of 5.70% Series  Due 2037*  One Hundred and Fourth  February 15, 2008  Company to U.S. Bank  National Association   Bonds of 5.35% Series  Due 2018*  One Hundred and Fifth  February 15, 2008  Company to U.S. Bank  National Association   Bonds of Pollution   Control Series N*  One Hundred and Sixth  September 15, 2008  Company to U.S. Bank  National Association   Bonds of 5.60% Series  Due 2013*  One Hundred and  Seventh  March 15, 2009  Company to U.S. Bank  National Association   Bonds of 5.00% Series  Due 2014*  One Hundred and Eighth  September 1, 2012  Company to U.S. Bank  National Association   Bonds of 2.375% Series  Due 2022*  One Hundred and Ninth  September 15, 2013  Company to U.S. Bank  National Association   Bonds of 1.200% Series  Due 2016*  

 

   11  Supplemental Indenture     and Date  Parties Providing for:  One Hundred and Tenth  September 15, 2013  Company to U.S. Bank  National Association   Bonds of 4.800% Series  Due 2043*  One Hundred and  Eleventh  September 1, 2014  Company to U.S. Bank  National Association   Bonds of 4.150% Series  Due 2044*  One Hundred and Twelfth         September 15, 2015  Company to U.S. Bank  National Association   Bonds of 3.15% Series  Due 2025*  One Hundred and  Thirteenth         September 1, 2016  Company to U.S. Bank  National Association  Bonds of 1.700% Series  Due 2021*  One Hundred and  Fourteenth         September 1, 2017  Company to U.S. Bank  National Association  Bonds of 3.700% Series  Due 2047*  One Hundred and  Fifteenth         February 1, 2018  Company to U.S. Bank  National Association  Bonds of 3.900% Series  Due 2048*  One Hundred and  Sixteenth         September 1, 2018  Company to U.S. Bank  National Association  Bonds of 3.900% Series  Due 2048  (Additional Issuance of Bonds of  3.900% Series due 2048)  One Hundred and  Seventeenth         August 15, 2019  Company to U.S. Bank  National Association  Bonds of 3.000% Series  Due 2049*    One Hundred and  Eighteenth         June 1, 2020  Company to U.S. Bank  National Association  Bonds of 2.800% Series  Due 2050*  One Hundred and  Nineteenth         February 15, 2021   Company to U.S. Bank  National Association  Bonds of 3.050% Series  Due 2051*  One Hundred and  Twentieth         September 1, 2021  Company to U.S. Bank  National Association  Bonds of 2.850% Series  Due 2051*  One Hundred and  Twenty-first         May 1, 2022  Company to U.S. Bank  National Association  Bonds of 4.600% Series  Due 2052*  *And amendment of certain provisions of the Ninth Supplemental Indenture.  

 

   12  WHEREAS, the respective principal amounts of the bonds of each series presently  outstanding under the Mortgage and the several supplemental indentures above referred to, are as  follows:      Series  PRINCIPAL  AMOUNT    5.90% Series due 2034 ................................................................. $ 75,000,000  5.95% Series due 2036 .................................................................. 300,000,000  5.70% Series due 2037 .................................................................. 175,000,000  4.80% Series due 2043 .................................................................. 250,000,000  4.150% Series due 2044 .................................................................. 300,000,000  3.150% Series due 2025 .................................................................. 350,000,000  3.700% Series due 2047 .................................................................. 325,000,000  3.900% Series due 2048 .................................................................. 650,000,000  3.000% Series due 2049 .................................................................. 325,000,000  2.800% Series due 2050 .................................................................. 350,000,000  3.050% Series due 2051 .................................................................. 375,000,000  2.850% Series due 2051 .................................................................. 375,000,000  4.600% Series due 2052 .................................................................. 350,000,000   Total $4,200,000,000    WHEREAS, the Company deems it advisable and has determined, pursuant to Article XI  of the Mortgage,  (a) to amend Article II of the Ninth Supplemental Indenture to the Mortgage as  heretofore amended;  (b) to convey, pledge, transfer and assign to the Trustee and to subject specifically to  the lien of the Mortgage additional property not therein or in any supplemental indenture  specifically described but now owned by the Company and acquired by it by purchase or  otherwise; and  (c) to create a new series of bonds to be issued from time to time under, and secured  by, the Mortgage, to be designated PECO Energy Company First and Refunding Mortgage Bonds,  4.375% Series due 2052, (hereinafter sometimes called the “bonds of the New Series” or the  “bonds of the 4.375% Series due 2052”); and for the above-mentioned purposes to execute, deliver  and record this Supplemental Indenture; and  WHEREAS, the Company has determined by proper corporate action that the terms,  provisions and form of the bonds of the New Series shall be substantially as follows:  

 

   13  (Form of Face of Bond)  UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF  THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO  THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE,  OR PAYMENT, AND ANY BOND 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 A PERSON IS WRONGFUL INASMUCH AS THE  REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.  PECO ENERGY COMPANY  REGISTERED          NUMBER  FIRST AND REFUNDING MORTGAGE BOND,  4.375% SERIES DUE 2052,   DUE AUGUST 15, 2052  PECO Energy Company, a Pennsylvania corporation (hereinafter called the Company), for  value received, hereby promises to pay to Cede & Co. or registered assigns, Four Hundred and  Twenty-Five Million Dollars on August 15, 2052, at the office or agency of the Company, in the  City of Philadelphia, Pennsylvania, or, at the option of the holder, at the office or agency of the  Company, in the Borough of Manhattan, The City of New York, in such coin or currency of the  United States of America as at the time of payment shall constitute legal tender for the payment of  public and private debts, and to pay interest (computed on the basis of a 360-day year of twelve  30-day months) thereon from the date hereof at the rate of 4.375 percent per annum in like coin or  currency, payable at either of the offices aforesaid on February 15 and August 15 of each year,  beginning on February 15, 2023, until the Company’s obligation with respect to the payment of  such principal shall have been discharged.    The record date for determining the registered holder of this bond entitled to an interest  payment shall be fourteen calendar days prior to any interest payment date.  Only the registered  holder on such record date shall be entitled to receive such payment, notwithstanding any transfer  of this bond upon the registration books subsequent to such record date.  This bond shall not be valid or become obligatory for any purpose unless it shall have been  authenticated by the certificate of the Trustee under said Mortgage endorsed hereon.  The provisions of this bond are continued on the reverse hereof and such continued  provisions shall for all purposes have the same effect as though fully set forth at this place.  [Remainder of this page intentionally left blank]  

 

   14  IN WITNESS WHEREOF, PECO Energy Company has caused this instrument to be  signed in its corporate name with the manual or facsimile signature of its Treasurer or Assistant  Treasurer, duly attested by the manual or facsimile signature of its Secretary or an Assistant  Secretary.  Dated:  PECO ENERGY COMPANY    By_________________________________   Treasurer or Assistant Treasurer    Attest______________________________    Secretary or Assistant Secretary  

 

   15  (Form of Reverse of Bond)  PECO ENERGY COMPANY  First and Refunding Mortgage Bond,  4.375% Series Due 2052,   Due August 15, 2052  (CONTINUED)  This bond is one of a duly authorized issue of bonds of the Company, unlimited as to  amount except as provided in the Mortgage hereinafter mentioned or in any indenture  supplemental thereto, and is one of a series of said bonds known as First and Refunding Mortgage  Bonds, 4.375% Series due 2052. This bond and all other bonds of said issue are issued and to be  issued under and pursuant to and are all secured equally and ratably by an indenture of mortgage  and deed of trust dated May 1, 1923, duly executed and delivered by The Counties Gas and Electric  Company (to which the Company is successor) to Fidelity Trust Company, as Trustee (to which  U.S. Bank National Association, a national banking association organized and existing under the  laws of the United States of America, is successor Trustee), as amended, modified or supplemented  by certain supplemental indentures from the Company or its predecessors to said successor Trustee  or its predecessors, said mortgage, as so amended, modified or supplemented being herein called  the Mortgage. Reference is hereby made to the Mortgage for a statement of the property mortgaged  and pledged, the nature and extent of the security, the rights of the holders of said bonds and of  the Trustee in respect of such security, the rights, duties and immunities of the Trustee, and the  terms and conditions upon which said bonds are and are to be secured, and the circumstances under  which additional bonds may be issued.  As provided in the Mortgage, the bonds secured thereby may be for various principal sums  and are issuable in series, which series may mature at different times, may bear interest at different  rates, and may otherwise vary. The bonds of this series mature on August 15, 2052, and are issuable  only in registered form without coupons in any denomination authorized by the Company.   Any bond or bonds of this series may be exchanged for another bond or bonds of this series  in a like aggregate principal amount in authorized denominations, upon presentation at the office  of the Trustee in the City of Philadelphia, Pennsylvania, or, at the option of the holder, at the office  or agency of the Company in the Borough of Manhattan, The City of New York, all subject to the  terms of the Mortgage but without any charge other than a sum sufficient to reimburse the  Company for any stamp tax or other governmental charge incident to the exchange.  The bonds of this series are redeemable at the option of the Company, as a whole or in part,  at any time upon notice sent by the Company through the mail, postage prepaid, or electronically  delivered (or otherwise transmitted in accordance with DTC’s (or another depositary’s)  procedures) at least ten (10) days and not more than sixty (60) days prior to the date fixed for  redemption, to the registered holder of each bond to be redeemed, addressed to such holder at his  address appearing upon the registration books.  At any time prior to February 15 , 2052 (six months  prior to the maturity date of the bonds of this series) (the “Par Call Date”), the redemption price  shall be equal to the greater of (1) 100% of the principal amount of the bonds to be redeemed; or  (2) (a) the sum of the present values of the remaining scheduled payments of principal and interest  

 

   16  thereon discounted to the redemption date (assuming the bonds to be redeemed matured on the Par  Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)  at the Treasury Rate plus 20 basis points less (b) interest accrued to the redemption date; plus, in  each case, accrued and unpaid interest to, but not including, the redemption date.  Unless the  Company defaults in payment of the redemption price, on and after the redemption date, interest  will cease to accrue on the bonds of this series or portions of the bonds of this series called for  redemption.  On or after the Par Call Date, the Company may redeem bonds of this series, in whole or  in part, at any time and from time to time, at a redemption price equal to 100% of the principal  amount of the bonds of this series being redeemed plus accrued and unpaid interest thereon to the  redemption date.   “Treasury Rate” means, with respect to any redemption date, the yield determined by the  Company in accordance with the following two paragraphs.  The Treasury Rate shall be determined by the Company after 4:15 p.m., New York City  time (or after such time as yields on U.S. government securities are posted daily by the Board of  Governors of the Federal Reserve System), on the third Business Day preceding the redemption  date based upon the yield or yields for the most recent day that appear after such time on such day  in the most recent statistical release published by the Board of Governors of the Federal Reserve  System designated as “Selected Interest Rates (Daily) - H.15” (or any successor designation or  publication) (“H.15”) under the caption “U.S. government securities–Treasury constant  maturities–Nominal” (or any successor caption or heading) (“H.15 TCM”). In determining the  Treasury Rate, the Company shall select, as applicable: (1) the yield for the Treasury constant  maturity on H.15 exactly equal to the period from the redemption date to the Par Call Date (the  “Remaining Life”); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to  the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on  H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on  H.15 immediately longer than the Remaining Life – and shall interpolate to the Par Call Date on a  straight-line basis (using the actual number of days) using such yields and rounding the result to  three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or  longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest  to the Remaining Life.  For purposes of this paragraph, the applicable Treasury constant maturity  or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of  months or years, as applicable, of such Treasury constant maturity from the redemption date.  If on the third Business Day preceding the redemption date H.15 TCM is no longer  published, the Company shall calculate the Treasury Rate based on the rate per annum equal to the  semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second  Business Day preceding such redemption date of the United States Treasury security maturing on,  or with a maturity that is closest to, the Par Call Date, as applicable.  If there is no United States  Treasury security maturing on the Par Call Date but there are two or more United States Treasury  securities with a maturity date equally distant from the Par Call Date, one with a maturity date  preceding the Par Call Date and one with a maturity date following the Par Call Date, the Company  shall select the United States Treasury security with a maturity date preceding the Par Call Date.   If there are two or more United States Treasury securities maturing on the Par Call Date or two or  

 

   17  more United States Treasury securities meeting the criteria of the preceding sentence, the  Company shall select from among these two or more United States Treasury securities the United  States Treasury security that is trading closest to par based upon the average of the bid and asked  prices for such United States Treasury securities at 11:00 a.m., New York City time.  In  determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual  yield to maturity of the applicable United States Treasury security shall be based upon the average  of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New  York City time, of such United States Treasury security, and rounded to three decimal places.  “Business Day” means any day that is not a day on which banking institutions in New York  City are authorized or required by law or regulation to close.  The Company’s actions and determinations in determining the redemption price shall be  conclusive and binding for all purposes, absent manifest error.  In the case of a partial redemption, selection of the bonds of this series for redemption will  be made pro rata, by lot or by such other method as the Trustee in its sole discretion deems  appropriate and fair.  No bonds of this series of a principal amount of $2,000 or less will be  redeemed in part. If any bonds of this series is to be redeemed in part only, the notice of redemption  that relates to the bond will state the portion of the principal amount of the bonds of this series to  be redeemed.  A new bonds of this series in a principal amount equal to the unredeemed portion  of the bonds of this series will be issued in the name of the holder of the bonds of this series upon  surrender for cancellation of the original bonds of this series.  For so long as the bonds of this  series are held by DTC (or another depositary), the redemption of the bonds of this series shall be  done in accordance with the policies and procedures of the depositary.  The principal of this bond may be declared or may become due on the conditions, in the  manner and with the effect provided in the Mortgage upon the happening of an event of default as  in the Mortgage provided.  This bond is transferable by the registered holder hereof in person or by attorney, duly  authorized in writing, at the office of the Trustee in the City of Philadelphia, Pennsylvania, or, at  the option of the holder, at the office or agency of the Company in the Borough of Manhattan, The  City of New York, in books of the Company to be kept for that purpose, upon surrender and  cancellation hereof, and upon any such transfer, a new registered bond or bonds, without coupons,  of this series and for the same aggregate principal amount, will be issued to the transferee in  exchange herefor, all subject to the terms of the Mortgage but without payment of any charge other  than a sum sufficient to reimburse the Company for any stamp tax or other governmental charge  incident to the transfer. The Company, the Trustee, and any paying agent may deem and treat the  person in whose name this bond is registered as the absolute owner hereof for the purpose of  receiving payment of or on account of the principal and interest due hereon and for all other  purposes, and neither the Company nor the Trustee nor any paying agent shall be affected by any  notice to the contrary.  No recourse shall be had for the payment of the principal of or interest on this bond to any  incorporator or any past, present or future stockholder, officer or director of the Company or of  any predecessor or successor corporation, either directly or indirectly, by virtue of any statute or  

 

   18  by enforcement of any assessment or otherwise, and any and all liability of the said incorporators,  stockholders, officers or directors of the Company or of any predecessor or successor corporation  in respect to this bond is hereby expressly waived and released by every holder hereof, except to  the extent that such liability may not be waived or released under the provisions of the Securities  Act of 1933, as amended, or of the rules and regulations of the Securities and Exchange  Commission thereunder.    (End of Form of Reverse of Bond)   

 

   19  and  WHEREAS, on the face of each of the bonds of the New Series, there is to be endorsed a  certificate of the Trustee in substantially the following form, to wit:  (Form of Trustee’s Certificate)  This bond is one of the bonds, of the series designated therein, provided for in the within- mentioned Mortgage and in the One Hundred and Twenty-Second Supplemental Indenture dated  as of August 1, 2022.  U.S. BANK NATIONAL ASSOCIATION,  Trustee    By______________________________  Authorized Officer  and  WHEREAS, all acts and things necessary to make the bonds of the New Series, when duly  executed by the Company and authenticated by the Trustee as provided in the Mortgage and  indentures supplemental thereto, and issued by the Company, the valid, binding and legal  obligations of the Company, and this Supplemental Indenture a valid and enforceable supplement  to the Mortgage, have been done, performed and fulfilled and the execution and delivery hereof  have been in all respects duly and lawfully authorized.  NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:  That in order to secure the payment of the principal of and interest on all bonds issued and  to be issued under the Mortgage and/or under any indenture supplemental thereto, according to  their tenor and effect, and according to the terms of the Mortgage and of any indenture  supplemental thereto, and to secure the performance of the covenants and obligations in the bonds  and in the Mortgage and any indenture supplemental thereto respectively contained, and for the  proper assuring, conveying, and confirming unto the Trustee, its successors in trust and its and  their assigns forever, upon the trusts and for the purposes expressed in the Mortgage and in any  indentures supplemental thereto, all and singular the estates, property and franchises of the  Company thereby mortgaged or intended so to be, the Company, for and in consideration of the  premises and of the sum of One Dollar ($1.00) in hand paid by the Trustee to the Company upon  the execution and delivery of this Supplemental Indenture, receipt whereof is hereby  acknowledged, and of other good and valuable consideration, has granted, bargained, sold,  conveyed, released, confirmed, pledged, assigned, transferred and set over and by these presents  does grant, bargain, sell, convey, release, confirm, pledge, assign, transfer, and set over to U.S.  Bank National Association, as Trustee, and to its successors in trust and its and their assigns  forever, all the following described property, real, personal and mixed of the Company, viz.:  

 

   20  The real property set forth in Exhibit A, attached hereto and hereby made a part hereof,  with any improvements thereon erected as may be owned by the Company but not specifically  described in the Mortgage or in any indenture supplemental thereto heretofore executed, in the  places set forth in Exhibit A.  All of the real property with any improvements thereon erected as may be owned by the  Company and described in the Mortgage or in any indenture supplemental thereto as may  heretofore have been executed, delivered and recorded, but excluding therefrom all real property  heretofore released from the lien of the Mortgage.  The purpose of restating such prior conveyances  as security is to confirm that the obligations of the Company as provided in this Supplemental  Indenture are included within the lien and security of the Mortgage, and that public record be made  of such purpose and fact by the recording of this Supplemental Indenture.  Together with all gas works, electric works, plants, buildings, structures, improvements  and machinery located upon such real estate or any portion thereof, and all rights, privileges and  easements of every kind and nature appurtenant thereto, and all and singular the tenements,  hereditaments and appurtenances belonging to the real estate or any part thereof hereinbefore  described or referred to or intended so to be, or in any way appertaining thereto, and the reversions,  remainders, rents, issues and profits thereof; also all the estate, right, title, interest, property,  possession, claim and demand whatsoever, as well in law as in equity, of the Company, of, in and  to the same and any and every part thereof, with the appurtenances.  Also all the Company’s electric transmission and distribution lines and systems,  substations, transforming stations, structures, machinery, apparatus, appliances, devices and  appurtenances.  Also all the Company’s gas transmission and distribution mains, pipes, pipe lines and  systems, storage facilities, structures, machinery, apparatus, appliances, devices and  appurtenances.  Also all plants, systems, works, improvements, buildings, structures, fixtures, appliances,  engines, furnaces, boilers, machinery, retorts, tanks, condensers, pumps, gas tanks, holders,  reservoirs, expansion tanks, gas mains and pipes, tunnels, service pipe, pipe lines, fittings, gates,  valves, connections, gas and electric meters, generators, dynamos, fans, supplies, tools and  implements, tracks, sidings, motor and other vehicles, all electric light lines, electric power lines,  transmission lines, distribution lines, conduits, cables, stations, substations, and distributing  systems, motors, conductors, converters, switchboards, shafting, belting, wires, mains, feeders,  poles, towers, mast arms, brackets, pipes, lamps, insulators, house wiring connections and all  instruments, appliances, apparatus, fixtures, fittings and equipment and all stores, repair parts,  materials and supplies of every nature and kind whatsoever now or hereafter owned by the  Company in connection with or appurtenant to its plants and systems for production, purchase,  storage, transmission, distribution, utilization and sale of gas and its by-products and residual  products, and/or for the generation, production, purchase, storage, transmission, distribution,  utilization and sale of electricity, or in connection with such business.  Also all the goodwill of the business of the Company, and all rights, claims, contracts,  leases, patents, patent rights, and agreements, all accounts receivable, accounts, claims, demands,  

 

   21  choses in action, books of account, cash assets, franchises, ordinances, rights, powers, easements,  water rights, riparian rights, licenses, privileges, immunities, concessions and consents now or  hereafter owned by the Company in connection with or appurtenant to its said business.  Also all the right, title and interest of the Company in and to all contracts for the purchase,  sale or supply of gas, and its by-products and residual products of electricity and electrical energy,  now or hereafter entered into by the Company with the right on the part of the Trustee, upon the  happening of an event of default as defined in the Mortgage as supplemented by any supplemental  indenture, to require a specific assignment of any and all such contracts, whenever it shall request  the Company to make the same.  Also all rents, tolls, earnings, profits, revenues, dividends and income arising or to arise  from any property now owned, leased, operated or controlled or hereafter acquired, leased,  operated or controlled by the Company and subject to the lien of the Mortgage and indentures  supplemental thereto.  Also all the estate, right, title and interest of the Company, as lessee, in and to any and all  demised premises under any and all agreements of lease now or at any time hereafter in force,  insofar as the same may now or hereafter be assignable by the Company.  Also all other property, real, personal and mixed not hereinbefore specified or referred to,  of every kind and nature whatsoever, now owned, or which may hereafter be owned by the  Company (except shares of stock, bonds or other securities not now or hereafter specifically  pledged under the Mortgage and indentures supplemental thereto or required to be pledged  thereunder by the provisions of the Mortgage or any indenture supplemental thereto), together with  all and singular the tenements, hereditaments and appurtenances thereunto belonging or in any  way appertaining and the reversions, remainder or remainders, rents, issues and profits thereof;  and also all the estate, right, title, interest, property, claim and demand whatsoever as well in law  as in equity of the Company of, in and to the same and every part and parcel thereof.  It is the intention and it is hereby agreed that all property and the earnings and income  thereof acquired by the Company after the date hereof shall be as fully embraced within the  provisions hereof and subject to the lien hereby created for securing the payment of all bonds,  together with the interest thereon, as if the property were now owned by the Company and were  specifically described herein and conveyed hereby, provided nevertheless, that no shares of stock,  bonds or other securities now or hereafter owned by the Company, shall be subject to the lien of  the Mortgage and indentures supplemental thereto unless now or hereafter specifically pledged or  required to be pledged thereunder by the provisions of the Mortgage or any indenture supplemental  thereto.  TO HAVE AND TO HOLD, all and singular the property, rights, privileges and franchises  hereby conveyed, transferred or pledged or intended so to be, including after-acquired property,  together with all and singular the reversions, remainders, rents, revenues, income, issues and  profits, privileges and appurtenances, now or hereafter belonging or in any way appertaining  thereto, unto the Trustee and its successors in the trust hereby created, and its and their assigns  forever;  

 

   22  IN TRUST NEVERTHELESS, for the equal and pro rata benefit and security of each and  every person or corporation who may be or become the holders of bonds secured by the Mortgage  and indentures supplemental thereto, without preference, priority or distinction (except as provided  in Section 1 of Article VIII of the Mortgage) as to lien or otherwise of any bond of any series over  or from any other bond, so that (except as aforesaid) each and every of the bonds issued or to be  issued, of whatsoever series, shall have the same right, lien, privilege under the Mortgage and  indentures supplemental thereto and shall be equally secured thereby and hereby, with the same  effect as if the bonds had all been made, issued and negotiated simultaneously on the date of the  Mortgage.  AND THIS SUPPLEMENTAL INDENTURE FURTHER WITNESSETH:  It is hereby covenanted that all bonds secured by the Mortgage and indentures supplemental  thereto with the coupons appertaining thereto, are issued to and accepted by each and every holder  thereof, and that the property aforesaid and all other property subject to the lien of the Mortgage  and indentures supplemental thereto is held by or hereby conveyed to the Trustee, under and  subject to the trusts, conditions and limitations set forth in the Mortgage and indentures  supplemental thereto and upon and subject to the further trusts, conditions and limitations  hereinafter set forth, as follows, to wit:  ARTICLE I  AMENDMENTS OF MORTGAGE  Section 1. Article II of the Ninth Supplemental Indenture to the Mortgage, as heretofore  amended, is hereby further amended as follows:  By adding to paragraph (d) of Section 5 and to the first clause of Section 9, the following:  “4.375% Series due 2052”  ARTICLE II.  BONDS OF THE NEW SERIES  Section 1. The bonds of the New Series shall be designated as hereinabove specified for  such designation in the recital immediately preceding the form of bonds of the New Series, subject  however, to the provisions of Section 2 of Article I of the Mortgage, as amended, and are issuable  only as registered bonds without coupons, substantially in the form hereinbefore recited.  Subject  to the provisions of the Mortgage, the bonds of the New Series shall be issuable without limitation  as to the aggregate principal amount thereof.   The bonds of the New Series shall bear interest from the date thereof and shall be dated as  of the interest payment date to which interest was paid next preceding the date of issue unless (a)  such date of issue is an interest payment date to which interest was paid, in which event such bonds  shall be dated as of such interest payment date, or (b) issued prior to the occurrence of the first  interest payment date on which interest is to be paid, in which event such bonds shall be dated  August 23, 2022.  The bonds of the New Series shall mature on August 15, 2052.  

 

   23  The bonds of the New Series shall bear interest (computed on the basis of a 360-day year  of twelve 30-day months) at the rate provided in the form of bond hereinbefore recited, payable  on February 15 and August 15 of each year, beginning on February 15, 2023, until the Company’s  obligation with respect to the payment of principal thereof shall have been discharged.  In the event  that any interest payment date is not a Business Day (as defined below), then the payment of  interest payable on such date will be made on the next succeeding day which is a Business Day  with the same force and effect as if made on the interest payment date (and without any interest or  other payment in respect of such delay).  Both principal and interest on bonds of the New Series  shall be payable at the office or agency of the Company in the City of Philadelphia, Pennsylvania,  or, at the option of the holder, at the office or agency of the Company in the Borough of Manhattan,  The City of New York, and shall be payable in such coin or currency of the United States of  America as at the time of payment shall constitute legal tender for the payment of public and  private debts.  The bonds of the New Series shall be in any denomination authorized by the Company.  Any bond or bonds of the New Series shall be exchangeable for another bond or bonds of  the New Series in a like aggregate principal amount.  Any such exchange may be made upon  presentation at the office of the Trustee in the City of Philadelphia, Pennsylvania, or, at the option  of the holder, at the office or agency of the Company in the Borough of Manhattan, The City of  New York, without any charge other than a sum sufficient to reimburse the Company for any stamp  tax or other governmental charge incident to the exchange.  Section 2. (a) Initially, the bonds of the New Series shall be issued pursuant to a book- entry system administered by The Depository Trust Company (or its successor, referred to herein  as the “Depository”) as a global security with no physical distribution of bond certificates to be  made except as provided in this Section 2.  Any provisions of the Mortgage or the bonds of the  New Series requiring physical delivery of bonds shall, with respect to any bonds of the New Series  held under the book-entry system, be deemed to be satisfied by a notation on the bond registration  books maintained by the Trustee that such bonds are subject to the book-entry system.  (b) So long as the book-entry system is being used, one or more bonds of the New  Series in the aggregate principal amount of the bonds of the New Series and registered in the name  of the Depository’s nominee (the “Nominee”) will be issued and required to be deposited with the  Depository and held in its custody.  The book-entry system will be maintained by the Depository  and its participants and indirect participants and will evidence beneficial ownership of the bonds  of the New Series, with transfers of ownership effected on the records of the Depository, the  participants and the indirect participants pursuant to rules and procedures established by the  Depository, the participants and the indirect participants.  The principal of and any premium on  each bond of the New Series shall be payable to the Nominee or any other person appearing on the  registration books as the registered holder of such bond or its registered assigns or legal  representative at the office of the office or agency of the Company in the City of Philadelphia,  Pennsylvania or the Borough of Manhattan, The City of New York.  So long as the book-entry  system is in effect, the Depository will be recognized as the holder of the bonds of the New Series  for all purposes.  Transfers of principal, interest and any premium payments or notices to  participants and indirect participants will be the responsibility of the Depository, and transfers of  principal, interest and any premium payments or notices to beneficial owners will be the  

 

   24  responsibility of participants and indirect participants.  No other party will be responsible or liable  for such transfers of payments or notices or for maintaining, supervising or reviewing such records  maintained by the Depository, the participants or the indirect participants.  While the Nominee or  the Depository, as the case may be, is the registered owner of the bonds of the New Series,  notwithstanding any other provisions set forth herein, payments of principal of, redemption  premium, if any, and interest on the bonds of the New Series shall be made to the Nominee or the  Depository, as the case may be, by wire transfer in immediately available funds to the account of  such holder.  Without notice to or consent of the beneficial owners, the Trustee with the consent  of the Company and the Depository may agree in writing to make payments of principal,  redemption price and interest in a manner different from that set forth herein.  In such event, the  Trustee shall make payment with respect to the bonds of the New Series in such manner as if set  forth herein.  (c) The Company may at any time elect (i) to provide for the replacement of any  Depository as the depository for the bonds of the New Series with another qualified depository, or  (ii) to discontinue the maintenance of the bonds of the New Series under book-entry system.  In  such event, the Trustee shall give 30 days’ prior notice of such election to the Depository (or such  fewer number of days acceptable to such Depository).  (d) Upon the discontinuance of the maintenance of the bonds of the New Series  under a book-entry system, the Company will cause the bonds to be issued directly to the beneficial  owners of the bonds of the New Series, or their designees, as further described below.  In such  event, the Trustee shall make provisions to notify participants and beneficial owners of the bonds  of the New Series, by mailing an appropriate notice to the Depository, that bonds of the New Series  will be directly issued to beneficial owners of the bonds as of a date set forth in such notice (or  such fewer number of days acceptable to such Depository).  (e) In the event that bonds of the New Series are to be issued to beneficial owners  of the bonds, or their designees, the Company shall promptly have bonds of the New Series  prepared in certificated form registered in the names of the beneficial owners of such bonds shown  on the records of the participants provided to the Trustee, as of the date set forth in the notice  above.  Bonds issued to beneficial owners, or their designees shall be substantially in the form set  forth in this Supplemental Indenture, but will not include the provision related to global securities.  (f) If the Depository is replaced as the depository for the bonds of the New Series  with another qualified depository, the Company will issue a replacement global security  substantially in the form set forth in this Supplemental Indenture.  (g) The Company and the Trustee shall have no liability for the failure of any  Depository to perform its obligations to any participant, any indirect participant or any beneficial  owner of any bonds of the New Series, and the Company and the Trustee shall not be liable for the  failure of any participant, indirect participant or other nominee of any beneficial owner or any  bonds of the New Series to perform any obligation that such participant, indirect participant or  other nominee may incur to any beneficial owner of the bonds of the New Series.  (h) Notwithstanding any other provision of the Mortgage, on or prior to the date of  issuance of the bonds of the New Series, the Trustee shall have executed and delivered to the initial  

 

   25  Depository a Letter of Representations governing various matters relating to the Depository and  its activities pertaining to the bonds of the New Series.  The terms and provisions of such Letter  of Representations are incorporated herein by reference and, in the event there shall exist any  inconsistency between the substantive provisions of the said Letter of Representations and any  provisions of the Mortgage, then, for as long as the initial Depository shall serve as depository  with respect to the bonds of the New Series, the terms of the Letter of Representations shall govern.   (i) The Company and the Trustee may rely conclusively upon (i) a certificate of  the Depository as to the identity of a participant in the book-entry system; (ii) a certificate of any  participant as to the identity of any indirect participant and (iii) a certificate of any participant or  any indirect participant as to the identity of, and the respective principal amount of bonds of the  New Series owned by, beneficial owners.  Section 3. So long as the bonds of the New Series are held by The Depository Trust  Company, such bonds of the New Series shall bear the following legend:  UNLESS THIS BOND IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE  OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO  THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR  PAYMENT, AND ANY BOND 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 A PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER  HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.  Section 4. So long as any of the bonds of the New Series remain outstanding, the Company  shall keep at its office or agency in the Borough of Manhattan, The City of New York, as well as  at the office of the Trustee in the City of Philadelphia, Pennsylvania, books for the registry and  transfer of outstanding bonds of the New Series, in accordance with the terms and provisions of  the bonds of the New Series and the provisions of Section 8 of Article I of said Mortgage.  Section 5. So long as any bonds of the New Series remain outstanding, the Company shall  maintain an office or agency in the City of Philadelphia, Pennsylvania, and an office or agency in  the Borough of Manhattan, The City of New York, for the payment upon proper demand of the  principal of, the interest on, or the redemption price of the outstanding bonds of the New Series,  and will from time to time give notice to the Trustee of the location of such office or agency.  In  case the Company shall fail to maintain for such purpose an office or agency in the City of  Philadelphia or shall fail to give such notice of the location thereof, then notices, presentations and  demands in respect of the bonds of the New Series may be given or made to or upon the Trustee  at its office in the City of Philadelphia and the principal of, the interest on, and the redemption  price of said bonds in such event be payable at said office of the Trustee.  All bonds of the New  Series when paid shall forthwith be cancelled.  Section 6. The record date for determining the registered holder of this bond entitled to an  interest payment shall be fourteen calendar days prior to any interest payment date.  Only the  

 

   26  registered holder of such bond on such record date shall be entitled to receive such payment,  notwithstanding any transfer of such bond upon the registration books subsequent to such record  date.  Section 7. The bonds of the New Series shall be issued under and subject to all of the terms  and provisions of the Mortgage, of the indentures supplemental thereto referred to in the recitals  hereof and of this Supplemental Indenture which may be applicable to such bonds or applicable to  all bonds issued under the Mortgage and indentures supplemental thereto.  ARTICLE III.    ISSUE AND AUTHENTICATION OF  BONDS OF THE NEW SERIES  In addition to any bonds of any series which may from time to time be executed by the  Company and authenticated and delivered by the Trustee upon compliance with the provisions of  the Mortgage and/or of any indenture supplemental thereto, bonds of the New Series of an  aggregate principal amount of $425,000,000 shall forthwith be executed by the Company and  delivered to the Trustee, and the Trustee shall thereupon, whether or not this Supplemental  Indenture shall have been recorded, authenticate and deliver said bonds to or upon the written order  of the President, a Vice President, the Treasurer, or the Assistant Treasurer of the Company, under  the terms and provisions of paragraph (c) of Section 3 of Article II of the Mortgage, as amended.  ARTICLE IV.    REDEMPTION OF BONDS OF THE  NEW SERIES    Section 1. The bonds of the New Series shall be redeemable at the option of the Company,  as a whole or in part, at any time upon notice sent by the Company through the mail, postage  prepaid, or electronically delivered (or otherwise transmitted in accordance with DTC’s (or another  depositary’s) procedures) at least ten (10) days and not more than sixty (60) days prior to the date  fixed for redemption, to the registered holder of each bond to be redeemed, addressed to such  holder at his address appearing upon the registration books.  At any time prior to February 15,  2052 (six months prior to the maturity date of the bonds of the New Series) (the “Par Call Date”),  the redemption price shall be equal to the greater of (1) 100% of the principal amount of the bonds  to be redeemed; and (2) (a) the sum of the present values of the remaining scheduled payments of  principal and interest thereon discounted to the redemption date (assuming the bonds to be  redeemed matured on the Par Call Date) on a semi-annual basis (assuming a 360-day year  consisting of twelve 30-day months) at the Treasury Rate plus 20 basis points less (b) interest  accrued to the redemption date; plus, in each case, accrued and unpaid interest to, but not including,  the redemption date.  Unless the Company defaults in payment of the redemption price, on and  after the redemption date, interest will cease to accrue on the bonds of the New Series or portions  of the bonds of the New Series called for redemption.  On or after the Par Call Date, the Company  may redeem the bonds of the New Series, in whole or in part, at any time and from time to time,  at a redemption price equal to 100% of the principal amount of the bonds of the New Series being  redeemed plus accrued and unpaid interest thereon to the redemption date.   

 

   27  For purposes of this Section 1, “Treasury Rate” means, with respect to any redemption  date, the yield determined by the Company in accordance with the following two paragraphs.  The Treasury Rate shall be determined by the Company after 4:15 p.m., New York City  time (or after such time as yields on U.S. government securities are posted daily by the Board of  Governors of the Federal Reserve System), on the third Business Day preceding the redemption  date based upon the yield or yields for the most recent day that appear after such time on such day  in the most recent statistical release published by the Board of Governors of the Federal Reserve  System designated as “Selected Interest Rates (Daily) - H.15” (or any successor designation or  publication) (“H.15”) under the caption “U.S. government securities–Treasury constant  maturities–Nominal” (or any successor caption or heading) (“H.15 TCM”). In determining the  Treasury Rate, the Company shall select, as applicable: (1) the yield for the Treasury constant  maturity on H.15 exactly equal to the period from the redemption date to the Par Call Date (the  “Remaining Life”); or (2) if there is no such Treasury constant maturity on H.15 exactly equal to  the Remaining Life, the two yields – one yield corresponding to the Treasury constant maturity on  H.15 immediately shorter than and one yield corresponding to the Treasury constant maturity on  H.15 immediately longer than the Remaining Life – and shall interpolate to the Par Call Date on a  straight-line basis (using the actual number of days) using such yields and rounding the result to  three decimal places; or (3) if there is no such Treasury constant maturity on H.15 shorter than or  longer than the Remaining Life, the yield for the single Treasury constant maturity on H.15 closest  to the Remaining Life.  For purposes of this paragraph, the applicable Treasury constant maturity  or maturities on H.15 shall be deemed to have a maturity date equal to the relevant number of  months or years, as applicable, of such Treasury constant maturity from the redemption date.  If on the third Business Day preceding the redemption date H.15 TCM is no longer  published, the Company shall calculate the Treasury Rate based on the rate per annum equal to the  semi-annual equivalent yield to maturity at 11:00 a.m., New York City time, on the second  Business Day preceding such redemption date of the United States Treasury security maturing on,  or with a maturity that is closest to, the Par Call Date, as applicable.  If there is no United States  Treasury security maturing on the Par Call Date but there are two or more United States Treasury  securities with a maturity date equally distant from the Par Call Date, one with a maturity date  preceding the Par Call Date and one with a maturity date following the Par Call Date, the Company  shall select the United States Treasury security with a maturity date preceding the Par Call Date.   If there are two or more United States Treasury securities maturing on the Par Call Date or two or  more United States Treasury securities meeting the criteria of the preceding sentence, the  Company shall select from among these two or more United States Treasury securities the United  States Treasury security that is trading closest to par based upon the average of the bid and asked  prices for such United States Treasury securities at 11:00 a.m., New York City time.  In  determining the Treasury Rate in accordance with the terms of this paragraph, the semi-annual  yield to maturity of the applicable United States Treasury security shall be based upon the average  of the bid and asked prices (expressed as a percentage of principal amount) at 11:00 a.m., New  York City time, of such United States Treasury security, and rounded to three decimal places.  “Business Day” means any day that is not a day on which banking institutions in New York  City are authorized or required by law or regulation to close.  

 

   28  The Company’s actions and determinations in determining the redemption price shall be  conclusive and binding for all purposes, absent manifest error.  In the case of a partial redemption,  selection of the bonds of the New Series for redemption will be made pro rata, by lot or by such  other method as the Trustee in its sole discretion deems appropriate and fair.  No bonds of the New  Series of a principal amount of $2,000 or less will be redeemed in part. If any bond of the New  Series is to be redeemed in part only, the notice of redemption that relates to the bond will state  the portion of the principal amount of the bonds of the New Series to be redeemed.  A new bond  of the New Series in a principal amount equal to the unredeemed portion of the bonds of the New  Series will be issued in the name of the holder of the bonds of the New Series upon surrender for  cancellation of the original bonds of the New Series.  For so long as the bonds of the New Series  are held by DTC (or another depositary), the redemption of the bonds of the New Series shall be  done in accordance with the policies and procedures of the depositary.  Section 2. In case the Company shall desire to exercise such right to redeem and pay off  all or any part of such bonds of the New Series as hereinbefore provided it shall comply with all  the terms and provisions of Article III of the Mortgage, as amended, applicable thereto, and such  redemption shall be made under and subject to the terms and provisions of Article III and in the  manner and with the effect therein provided, but at the time or times and upon mailing of notice,  all as hereinbefore set forth in Section 1 of this Article. No publication of notice of any redemption  of any bonds of the New Series shall be required.  ARTICLE V.    CERTAIN EVENTS OF DEFAULT; REMEDIES  Section 1.  So long as any bonds of the New Series remain outstanding, in case one or more  of the following events shall happen, such events shall, in addition to the events of default  heretofore enumerated in paragraphs (a) throughout (d) of Section 2 of Article VIII of the  Mortgage, constitute an “event of default” under the Mortgage, as fully as if such events were  enumerated therein:  (e) default shall be made in the due and punctual payment of the principal  (including the full amount of any applicable optional redemption price) of any bond or  bonds of the New Series whether at the maturity of said bonds, or at a date fixed for  redemption of said bonds, or any of them, or by declaration as authorized by the Mortgage;  Section 2.  So long as any bonds of the New Series remain outstanding, Section 10 of  Article VIII of the Mortgage, as heretofore amended, is hereby further amended by inserting in the  first paragraph of such Section 10, immediately after the words “as herein provided,” at the end of  clause (2) thereof, the following:  “or (3) in case default shall be made in any payment of any interest on any bond or bonds  secured by this indenture or in the payment of the principal (including any applicable optional  redemption price) of any bond or bonds secured by this indenture, where such default is not of the  character referred to in clause (1) or (2) of this Section 10 but constitutes an event of default within  the meaning of Section 2 of this Article VIII.”  

 

   29  ARTICLE VI.    CONCERNING THE TRUSTEE  The Trustee hereby accepts the trust herein declared and provided and agrees to perform  the same upon the terms and conditions set forth in the Mortgage, as amended and supplemented,  and upon the following terms and conditions:  The Trustee shall not be responsible in any manner whatsoever for or in respect of the  validity of this 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.  ARTICLE VII.    MISCELLANEOUS  Section 1. Unless otherwise clearly required by the context, the term “Trustee,” or any  other equivalent term used in this Supplemental Indenture, shall be held and construed to mean  the trustee under the Mortgage for the time being whether the original or a successor trustee.  Section 2. The headings of the Articles of this Supplemental Indenture are inserted for  convenience of reference only and are not to be taken to be any part of this Supplemental Indenture  or to control or affect the meaning of the same.  Section 3. Nothing expressed or mentioned in or to be implied from this Supplemental  Indenture or in or from the bonds of the New Series is intended, or shall be construed, to give any  person or corporation, other than the parties hereto and their respective successors, and the holders  of bonds secured by the Mortgage and the indentures supplemental thereto, any legal or equitable  right, remedy or claim under or in respect of such bonds or the Mortgage or any indenture  supplemental thereto, or any covenant, condition or provision therein or in this Supplemental  Indenture contained. All the covenants, conditions and provisions thereof and hereof are for the  sole and exclusive benefit of the parties hereto and their successors and of the holders of bonds  secured by the Mortgage and indentures supplemental thereto.  Section 4. This Supplemental Indenture may be executed in several counterparts, each of  which shall be an original and all collectively but one instrument.  Section 5. This Supplemental Indenture shall be effective as of August 1, 2022, but was  actually executed and delivered as of August 1, 2022.    [Remainder of this page intentionally left blank] 

 

   Supplemental Indenture – Company’s Signature Page  IN WITNESS WHEREOF, an Authorized Officer of the party of the first part and a Vice  President of the party of the second part, under and by the authority vested in them, have hereto  affixed their signatures this 1st day of August, 2022.    PECO ENERGY COMPANY    By_______________________________        Elizabeth M. Hensen, Authorized Officer    

 

   Supplemental Indenture – Trustee’s Signature Page  U.S. BANK NATIONAL ASSOCIATION,  Trustee    By________________________________  Michael Judge  Vice President      

 

   Supplemental Indenture – Company’s Notary Page    STATE OF ILLINOIS )          )  SS.   COUNTY OF COOK  )     On this, the 1st day of August, 2022, before me, a Notary Public in and for the State of  Illinois, the undersigned officer, personally appeared Elizabeth M. Hensen, who acknowledged  herself to be an Authorized Officer of PECO Energy Company, a Pennsylvania corporation, and  that she as such officer, being authorized to do so, executed the foregoing instrument for the  purposes therein contained, by signing the name of the corporation by herself as such officer.   In witness whereof, I hereunto set my hand and official seal.           __________________________________           Notary Public  My Commission expires:  [NOTARIAL SEAL]  

 

   Supplemental Indenture – Trustee’s Notary Page    COMMONWEALTH OF PENNSYLVANIA :          :  SS.  COUNTY OF _____________________   :     On this, the 1st day of August, 2022, before me, a Notary Public in and for the  Commonwealth of Pennsylvania, the undersigned officer, personally appeared Michael Judge who  acknowledged himself to be the Vice President of U.S. Bank National Association, a national  banking association, as Trustee, and that he as such officer, being authorized to do so, executed  the foregoing instrument for the purposes therein contained, by signing the name of the national  banking association, as Trustee, by himself as such officer.   In witness whereof, I hereunto set my hand and official seal.           ____________________________________           Notary Public  My Commission expires:  [NOTARIAL SEAL]        

 

     CERTIFICATE OF RESIDENCE  U.S. Bank National Association, Mortgagee and Trustee within named, hereby certifies  that its precise address in the City of Philadelphia is 50 South 16th Street, Philadelphia,  Pennsylvania 19102.        U.S. BANK NATIONAL ASSOCIATION,  Trustee      By________________________________  Michael Judge  Vice President  

 

   A-1    Exhibit A  All that certain tract of land Situate along the westerly side of Sproul Road in the Township  of Marple, County of Delaware, Commonwealth of Pennsylvania, and as shown on a plan  entitled 'Subdivision Plan, 2014 to 2090 Sproul Road, Marple Township, Delaware County,  Pennsylvania', dated 8/24/2020, by Barry Isett & Associates, signed 10/20/2020 by Robert J.  Beers, P.L.S., and being described as follows, to wit:  Beginning at a point on the southerly right of way line of Cedar Grove Road (50' wide) being  a corner in common to Lot 1 (parent tract of Lot 2);  Thence the following two courses are along the southerly right of way line of Cedar Grove  Road:  1. North 46°58'29" East 100.35' to a point of curvature; Thence  2. Along the arc of a curve to the right having a central angle of 110°40'24", a radius of  50.00' and an arc length of 96.58' to a point; Thence  The following two courses are along the westerly right of way line of Sproul Road (S.R. #320  - variable width):  3. South 22°21'07" East 86.86' to a point; Thence  4. South 23°04'52" East 26.04' to a point; Thence  The following three courses are along Lot 1 (parent tract of Proposed Lot 2):  5. South 67°06'54" West 150.52' to a point; Thence  6. North 24°39'14" West 107.02' to a point; Thence  7. North 43°01'31" West 20.00' to the Point and Place of Beginning.    Tax ID / Parcel No. 25-00-04486-01

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