PECO ENERGY COMPANY
AND
First Union National Bank, as Trustee
SECOND SUPPLEMENTAL
INDENTURE
Dated as of June 1, 1997
to
INDENTURE
Dated as of July 1, 1994
Providing for the Issuance of
____% Deferrable Interest Subordinated Debentures, Series C
TABLE OF CONTENTS
Page
----
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE................. 2
SECTION 1.01 Definitions................................................ 2
ARTICLE 2
THE SERIES C DEBENTURES.................................... 2
SECTION 2.01 Form of the Series C Debentures; Denominations............. 2
ARTICLE 3
REDEMPTION................................................. 3
SECTION 3.01 Redemption; Notice to Trustee.............................. 3
SECTION 3.02 Compliance with Terms of Indenture......................... 3
ARTICLE 4
EXTENSION PERIOD........................................... 4
SECTION 4.01 Limitation on Right of Company to Extend
Interest Payment Period................................... 4
ARTICLE 5
CONCERNING THE TRUSTEE
SECTION 5.01 Not Responsible for Recitals............................... 4
SECTION 5.02 Qualification Under Trust Indenture Act
of 1939................................................... 4
ARTICLE 6
MISCELLANEOUS
SECTION 6.01 Trust Indenture Act Controls............................... 4
SECTION 6.02 Severability Clause........................................ 5
SECTION 6.03 Governing Law.............................................. 5
SECTION 6.04 No Recourse Against Others................................. 5
SECTION 6.05 Use of Term "Trustee"...................................... 5
SECTION 6.06 Confirmation of Original Indenture......................... 5
SECTION 6.07 Successors................................................. 6
SECTION 6.08 Multiple Original Copies of this Indenture................. 6
SECTION 6.09 Table of Contents; Headings, Etc........................... 6
SECTION 6.10 Benefits of the Indenture.................................. 6
SECTION 6.11 Date of Indenture.......................................... 6
(i)
SECOND SUPPLEMENTAL INDENTURE, dated as of June 1, 1997, by
and between PECO Energy Company, a Pennsylvania corporation (the "Company"), and
First Union National Bank, a national association, as successor trustee (the
"Trustee"), to an Indenture, dated as of July 1, 1994 (the "Original
Indenture"), by and between the Company and the Trustee, which was supplemented
by a First Supplemental Indenture (the "First Supplemental Indenture") dated as
of December 1, 1995 (the Original Indenture, as supplemented, the "Indenture").
WHEREAS, the Company has formed a wholly owned subsidiary,
PECO Energy Capital Corp., which is the general partner of PECO Energy Capital,
L.P., a Delaware limited partnership ("PECO Energy Capital"), to issue in series
from time to time its limited partner interests ("Preferred Securities") and to
loan the proceeds thereof, together with the investment by PECO Energy Capital
Corp. in PECO Energy Capital, to the Company and to effect other similar
arrangements.
WHEREAS, the Company has duly executed and delivered to the
Trustee the Original Indenture to provide for the issue of one or more series of
deferrable interest subordinated debentures (herein sometimes called the
"Debentures"), issuable as in the Indenture provided, and authorized and issued
the initial series of Debentures which were designated therein as the 9%
Deferrable Interest Subordinated Debentures, Series A.
WHEREAS, the Company has duly executed and delivered to the
Trustee the First Supplemental Indenture authorizing and providing for the
issuance of the second series of Debentures which were designated the 8.72%
Deferrable Interest Subordinated Debentures, Series B.
WHEREAS, the Company desires to authorize and to effect the
issuance of a third series of Debentures in an aggregate principal amount of
$51,546,392 and to designate such series ____% Deferrable Interest Subordinated
Debentures, Series C (the "Series C Debentures") under this Second Supplemental
Indenture.
WHEREAS, all things necessary to make the Series C Debentures
when duly issued and executed by the Company and authenticated and delivered
hereunder, the valid obligations of the Company, and to make this Second
Supplemental Indenture a valid and binding agreement of the Company, in
accordance with its terms, have been done.
NOW THEREFORE:
Each of the Company and the Trustee, intending to be legally
bound hereby, agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Holders of the Series C Debentures:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions.
"Additional Interest", with respect to the Series C
Debentures, means amounts, if any, which PECO Energy Capital would be required
to pay as taxes, duties, assessments or governmental charges of whatever nature
(other than withholding taxes) imposed by the United States, or any other taxing
authority, with respect to the Series C Debentures.
"Issue Date" means June ___, 1997.
"Series C Debentures" means any of the Company's ____%
Deferrable Interest Subordinated Debentures, Series C issued under this Second
Supplemental Indenture.
"Series C Debentureholder" or "Series C Holder" means a Person
in whose name a Series C Debenture is registered on the Registrar's books.
"Series C Preferred Securities" means the ____% Cumulative
Monthly Income Preferred Securities, Series C, representing limited partner
interests of PECO Energy Capital.
Unless otherwise defined herein, all other capitalized terms
used herein have the meanings set forth in the Original Indenture.
ARTICLE 2
THE SERIES C DEBENTURES
SECTION 2.01 Form of the Series C Debentures; Denominations.
The Series C Debentures and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A attached hereto.
The terms and provisions contained in the Series C Debentures, a form of which
is annexed hereto as Exhibit A, shall constitute, and are hereby expressly made,
a part of this Second Supplemental Indenture. The Company and the Trustee, by
their execution and delivery of this Second Supplemental Indenture, expressly
agree to such terms and provisions and to be bound thereby.
The Trustee shall authenticate and make available for delivery
the Series C Debentures for original issue in the aggregate principal amount of
$51,546,392 to evidence the Company's obligation with respect to the loan from
PECO Energy
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Capital, upon receipt by the Trustee of a Board of Directors resolution and a
written order of the Company signed by two Officers of the Company, but without
any further action by the Company. Such order shall specify the amount of the
Series C Debentures to be authenticated and the date on which the original issue
of Series C Debentures is to be authenticated and delivered to evidence the
Company's obligation with respect to the loan from PECO Energy Capital. The
aggregate principal amount of Series C Debentures outstanding at any time may
not exceed $51,546,392 except as provided in Section 2.09 of the Original
Indenture.
The Series C Debentures shall be issuable only in registered
form without coupons and only in denominations of $25.00 and any integral
multiple thereof attached hereto as Exhibit A.
ARTICLE 3
REDEMPTION
SECTION 3.01 Redemption; Notice to Trustee.
(a) The Series C Debentures are subject to redemption prior to
maturity as provided in the form thereof attached hereto as Exhibit A.
(b) If any or all of the Series C Debentures are to be
redeemed pursuant to paragraph (a) above, in addition to the notices required by
the Original Indenture, the Company shall give notice by first class mail,
postage prepaid, to the Trustee at least 40 days prior to the date of such
redemption. Any such notice of redemption shall state the date and price of
redemption.
SECTION 3.02 Compliance with Terms of Indenture.
In case the Company shall desire to exercise such right to
redeem all or any part of said Series C Debentures as hereinbefore provided, it
shall comply with all the terms and provisions of Article III of the Original
Indenture applicable thereto, and such redemption shall be made under and
subject to the terms and provisions of said Article III and in the manner and
with the effect therein provided, but at the time or times and at the respective
redemption rates and upon mailing of notice, all as hereinbefore set forth in
Section 3.01 of this Article.
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ARTICLE 4
EXTENSION PERIOD
SECTION 4.01 Limitation on Right of Company to Extend Interest Payment Period.
The Company agrees that no extended interest payment period
shall extend beyond the stated maturity date or redemption date of the Series C
Debentures.
ARTICLE 5
CONCERNING THE TRUSTEE
The Trustee hereby reaffirms acceptance of the trust herein
declared and provided and agrees to perform the same upon the terms and
conditions set forth in the Indenture, as supplemented by the First Supplemental
Indenture and this Second Supplemental Indenture, and upon the following terms
and conditions:
SECTION 5.01 Not Responsible for Recitals.
The Trustee shall not be responsible in any manner whatsoever
for or in respect of the validity or sufficiency of this Second Supplemental
Indenture or the due execution thereof by the Company or for or in respect of
the recitals contained herein, all of which recitals are made solely by the
Company.
SECTION 5.02 Qualification Under Trust Indenture Act of 1939.
The Trustee hereby acknowledges that the Company proposes to
qualify this Second Supplemental Indenture under the Trust Indenture Act of
1939, as amended.
ARTICLE 6
MISCELLANEOUS
SECTION 6.01 Trust Indenture Act Controls.
If any provision of this Second Supplemental Indenture limits,
qualifies or conflicts with the duties imposed by operation of subsection (c) of
Section 318 of the TIA, the imposed duties shall control. The provisions of
Sections 310 to 317, inclusive, of the TIA that impose duties on any Person
(including provisions automatically deemed included in an indenture unless the
indenture provides that such provisions are excluded) as a part of and govern
this Second Supplemental Indenture, except as, and to the extent, they are
expressly
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excluded from this Second Supplemental Indenture, as permitted by the TIA.
SECTION 6.02 Severability Clause.
If any provision in this Second Supplemental Indenture or in
the Series C Debentures shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 6.03 Governing Law.
This Second Supplemental Indenture and the Series C Debentures
shall be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania as applied to contracts made and performed within
the Commonwealth of Pennsylvania, without regard to its principles of conflicts
of laws.
SECTION 6.04 No Recourse Against Others.
No director, officer, employee or stockholder, as such, of the
Company shall have any liability for any obligations of the Company under the
Series C Debentures or this Second Supplemental Indenture or for any claim based
on, in respect of or by reason of such obligations or their creation. By
accepting a Series C Debenture, each Series C Debentureholder shall waive and
release all such liability. The waiver and release shall be part of the
consideration for the issue of the Series C Debentures.
SECTION 6.05 Use of Term "Trustee".
Unless otherwise clearly required by the context, the term,
"Trustee," or any other equivalent term used in this Second Supplemental
Indenture shall be held and construed to mean the trustee under the Indenture
for the time being whether the original or a successor trustee.
SECTION 6.06 Confirmation of Original Indenture.
As supplemented by the First Supplemental Indenture and this
Second Supplemental Indenture, the Original Indenture, is in all respects
ratified and confirmed, and this Second Supplemental Indenture shall be read,
taken and construed as a part of the Indenture so that all of the rights,
remedies, terms, conditions, covenants and agreements of the Indenture shall
apply and remain in full force and effect with respect to this Second
Supplemental Indenture and to the Series C Debentures issued hereunder.
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SECTION 6.07 Successors.
All agreements of the Company in this Second Supplemental
Indenture and the Series C Debentures shall bind its successors and assigns. All
agreements of the Trustee in this Second Supplemental Indenture shall bind its
successors and assigns.
SECTION 6.08 Multiple Original Copies of this Indenture.
The parties may sign any number of copies of this Second
Supplemental Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. Any signed copy shall be sufficient proof
of this Second Supplemental Indenture.
SECTION 6.09 Table of Contents; Headings, Etc.
The Table of Contents, Cross-Reference Table, and headings of
the Articles and Sections of this Second Supplemental Indenture have been
inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions
hereof.
SECTION 6.10 Benefits of the Indenture.
Except as expressly provided in Article 10 of the Original
Indenture, nothing in this Second Supplemental Indenture or in the Series C
Debentures, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, the Series C Holders and the Special
Representative, any benefit or any legal or equitable right, remedy or claim
under this Second Supplemental Indenture.
SECTION 6.11 Date of Indenture.
This Second Supplemental Indenture is dated as of June 1,
1997, but was actually executed and delivered on June ___, 1997.
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SIGNATURES
IN WITNESS WHEREOF, the undersigned, being duly authorized,
have executed this Second Supplemental Indenture on behalf of the respective
parties hereto as of the date first above written.
PECO ENERGY COMPANY
By: _____________________________________
Name: X. Xxxxx Xxxxxxxx
Title: Vice President - Finance
FIRST UNION NATIONAL BANK,
as Trustee
By: _____________________________________
Name: ___________________________________
Title: __________________________________
PECO Energy Capital, L.P.
By its General Partner,
PECO Energy Capital Corp.
By: __________________________________
Name: X. Xxxxx Xxxxxxxx
Title: President
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Exhibit A
____% Deferrable Interest Subordinated Debentures,
Series C due 2037
No. ___
PECO Energy Company, a Pennsylvania corporation (the "Company"), which term
includes any successor corporation under the Indenture, as defined herein), for
value received, hereby promises to pay to PECO Energy Capital, L.P. or
registered assigns, the principal sum of _______________________________
__________________________________ Dollars on June ___, 2037, and to pay
interest on said principal sum from June ____, 1997 (the "Issue Date") or from
the most recent interest payment date (each such date, an "Interest Payment
Date") to which interest has been paid or duly provided for, monthly in arrears
on the last day of each calendar month of each year commencing June 30, 1997 at
the rate of ____% per annum plus Additional Interest, if any, until the
principal hereof shall have become due and payable, and on any overdue principal
and premium, if any, and (to the extent that payment of such interest is
enforceable under applicable law) on any overdue installment of interest at the
same rate per annum. If at any time PECO Energy Capital, L.P. ("PECO Energy
Capital") would be required to pay any taxes, duties, or other governmental
charges (other than withholding taxes) imposed by the United States, or any
other taxing authority, then, in any such case, the Company also will pay as
Additional Interest such amounts as shall be required so that the net amounts
received and retained by PECO Energy Capital after paying any such taxes,
duties, or other governmental charges will not be less than the amounts PECO
Energy Capital would have received had no such taxes, duties, assessments or
other governmental charges been imposed.
The amount of interest payable on any Interest Payment Date
shall be computed on the basis of a 360-day year of twelve 30-day months. In the
event that any date on which interest is payable on the Series C Debentures is
not a Business Day, then payment of interest payable on such date will be made
on the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such Business Day
is in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date. The interest installment so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the person in whose name this Debenture is registered at
the close of business on the regular record date for such interest installment,
which shall be the fifteenth day of the month of, or in the case of an Interest
Payment Date which is on the first Business Day of a month, the
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fifteenth day of the month next preceding, such Interest Payment Date. Any such
interest installment not punctually paid or duly provided for shall forthwith
cease to be payable to the registered holders on such regular record date, and
may be paid to the person in whose name this Debenture is registered at the
close of business on a special record date to be fixed by the Trustee for the
payment of such defaulted interest, notice whereof shall be given to the
registered holders of this series of Debentures not less than 10 days prior to
such special record date, as more fully provided in the Indenture. The principal
of (and premium, if any) and the interest on this Debenture shall be payable at
the office or agency of the Company maintained for that purpose in Wilmington,
Delaware in any coin or currency of the United States of America which at the
time of payment is legal tender for payment of public and private debts;
provided however, that payment of interest may be made at the option of the
Company by check mailed to the registered holder at such address as shall appear
in the Debenture Register. Notwithstanding the foregoing, so long as the holder
of this Debenture is PECO Energy Capital, the payment of the principal of (and
premium) and interest (including Additional Interest, if any) on this Debenture
will be made at such place and to such account as may be designated by PECO
Energy Capital.
The indebtedness evidenced by this Debenture is, to the extent
provided in the Indenture, subordinate and subject in right of payment to the
prior payment in full of all Senior Indebtedness, and this Debenture is issued
subject to the provisions of the Indenture with respect thereto. Each Holder of
this Debenture, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on its behalf to take such
action as may be necessary or appropriate to acknowledge or effectuate the
subordination so provided and (c) appoints the Trustee its attorney-in-fact for
any and all such purposes. Each Holder hereof, by its acceptance hereof, hereby
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such Holder upon
said provisions.
This Debenture is one of a duly authorized series of
Debentures of the Company (herein sometimes referred to as the "Series C
Debentures"), specified in the Indenture, limited in aggregate principal amount
as specified in the Indenture, issued under and pursuant to an Indenture dated
as of July 1, 1994, as supplemented by a First Supplemental Indenture, dated as
of December 1, 1995 and a Second Supplemental Indenture dated as of June 1, 1997
(as supplemented, the "Indenture") executed and delivered between the Company
and First Union National Bank, as successor trustee (the "Trustee") to
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which reference is made to the Indenture for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the holders of the Debentures. By the terms of the
Indenture, Debentures are issuable in series which may vary as to amount, date
of maturity, rate of interest and in other respects as in the Indenture
provided.
The Series C Debentures are subject to mandatory redemption
prior to maturity at 100% of the principal amount thereof plus accrued interest
to the redemption date as follows:
(i) in whole upon the dissolution of PECO Energy
Capital; and
(ii) in whole or in part upon a redemption of the
Series C Preferred Securities, but if in
part, in an aggregate principal amount equal
to the aggregate stated liquidation
preference of the Series C Preferred
Securities redeemed.
At the option of the Company, the Series C Debentures are
subject to redemption prior to maturity (i) at any time on or after June ___,
2002, in whole or in part, and (ii) if a Tax Event shall occur and be
continuing, in whole or in part, and in each case at 100% of the principal
amount thereof plus accrued interest to the redemption date. "Tax Event" shall
mean that PECO Energy Capital shall have received an opinion of counsel (which
may be regular counsel to the Company or an Affiliate, but not an employee
thereof) experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein affecting taxation, or as a
result of any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or such interpretation or pronouncement is announced on or after the
date of original issuance of the Series C Preferred Securities, there is more
than an insubstantial risk that (i) PECO Energy Capital is subject to United
States Federal income tax with respect to interest received on the Debentures or
PECO Energy Capital will otherwise not be taxed as a partnership, (ii) interest
payable by the Company to PECO Energy Capital on the Series C Debentures will
not be deductible for United States Federal income tax purposes or (iii) PECO
Energy Capital is subject to more than a de minimis amount of other taxes,
duties or other governmental charges.
In the event of redemption of this Debenture in part only, a
new Debenture or Debentures of this series for the
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unredeemed portion hereof will be issued in the name of the Holder hereof upon
the cancellation hereof.
In case an Event of Default shall have occurred and be
continuing, the principal of all of the Debentures may be declared, and upon
such declaration shall become, due and payable, in the manner, with the effect
and subject to the conditions provided in the Indenture.
The Indenture contains provisions for defeasance at any time
of the entire indebtedness of this Debenture upon compliance by the Company with
certain conditions set forth therein.
Subject to certain exceptions in the Indenture which require
the consent of every Holder, (i) the Indenture or the Series C Debentures may be
amended with the written consent of the Holders of a majority in aggregate
principal amount of the Series C Debentures at the time outstanding, and (ii)
certain defaults or noncompliance with certain provisions may be waived by the
written consent of the holders of a majority in aggregate principal amount of
the Series C Debentures at the time outstanding. Subject to certain exceptions
in the Indenture, without the consent of any Debentureholder, the Company and
the Trustee may amend the Indenture or the Debentures to cure any ambiguity,
defect or inconsistency, to bind a successor to the obligations of the
Indenture, to provide for uncertificated Debentures in addition to certificated
Debentures, to comply with any requirements of the Debentures or the Securities
and Exchange Commission in connection with the qualification of the Indenture
under the TIA, or to make any change that does not adversely affect the rights
of any Debentureholder. Amendments bind all Holders and subsequent Holders.
No reference herein to the Indenture and no provision of this
Debenture or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest on this Debenture at the time and place and at the
rate and in the money herein prescribed.
So long as an Event of Default has not occurred and is
continuing, the Company shall have the right at any time during the term of the
Series C Debentures, from time to time to extend the interest payment period of
such Debentures to up to 60 consecutive months (the "Extended Interest Payment
Period"), at the end of which period the Company shall pay all interest then
accrued and unpaid (together with interest thereon at the rate specified for the
Series C Debentures to the extent that payment of such interest is enforceable
under applicable law); provided that, during such Extended Interest Payment
Period the Company shall not declare or pay any dividend on, redeem or purchase
any of its capital stock. Prior to the termination of any such Extended Interest
Payment Period, the Company may further extend
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such Extended Interest Payment Period, provided that such Period together with
all such further extensions thereof shall not exceed 60 consecutive months. At
the termination of any such Extended Interest Payment Period and upon the
payment of all accrued and unpaid interest and any additional amounts then due,
the Company may select a new Extended Interest Payment period.
As provided in the Indenture and subject to certain
limitations therein set forth, this Debenture is transferable by the registered
holder hereof on the Debenture Register of the Company, upon surrender of this
Debenture for registration of transfer at the office or agency of the Registrar
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Company or the Trustee duly executed by the registered
holder hereof or its attorney duly authorized in writing, and thereupon one or
more new Debentures of authorized denominations and for the same aggregate
principal amount and series will be issued to the designated transferee or
transferees. No service charge will be made for any such transfer, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in relation thereto.
Prior to presentment for registration of transfer of this
Debenture, the Company, the Trustee, any paying agent and any Debenture
Registrar may deem and treat the registered holder hereof as the absolute owner
hereof (whether or not this Debenture shall be overdue and notwithstanding any
notice of ownership or writing hereon made by anyone other than the Debenture
Registrar) for the purpose of receiving payment of or on account of the
principal hereof and premium, if any, and interest due hereon and for all other
purposes, and neither the Company nor the Trustee nor any payment agent nor any
Debenture Registrar shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of
or the interest on this Debenture, or for any claim based hereon, or otherwise
in respect hereof, or based on or in respect of the Indenture, against any
incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor corporation, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released. Debentures of this series so issued are issuable only in
registered form without coupons in denominations of $25 and any integral
multiple thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Debentures of this series are exchangeable for a
like aggregate principal amount of Debentures of this series of a different
authorized denomination, as requested by the Holder surrendering the same.
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All capitalized terms used in this Debenture which are defined
in the Indenture shall have the meanings assigned to them in the Indenture.
This Debenture shall not be valid until an authorized officer
of the Trustee manually signs the Trustee's Certificate of Authentication below.
IN WITNESS WHEREOF, the Company has caused this Debenture to
be signed manually or by facsimile by its duly authorized officers and a
facsimile of its corporate seal to be affixed hereto or imprinted hereon.
PECO ENERGY COMPANY
(Seal)
By: __________________________
Name:
Title:
Attest:_______________________
Dated: June ___, 1997
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debentures referred
to in the within-mentioned Indenture.
FIRST UNION NATIONAL BANK, as Trustee
By: ___________________________________
Name:
Title:
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