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INDENTURE
SUPPLEMENTAL
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TO
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MORTGAGE AND DEED OF
TRUST
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(Dated January 15,
1937)
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Executed By
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ATLANTIC CITY ELECTRIC
COMPANY
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TO
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THE BANK OF NEW YORK,
Trustee.
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_____________________________________
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Dated as of August 10,
2004
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This instrument was
prepared by Randall V. Griffin
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_______________________________________________________________________________________________________________
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TABLE OF CONTENTS*
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Page
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PARTIES
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1
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RECITALS
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1
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Execution of Mortgage
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1
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Execution of Supplemental Indentures
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1
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Acquisition of property rights and property
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2
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No Default under Original Indenture
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2
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Provision for issuance of bonds in one or more series
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2
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Right to execute supplemental indenture
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2
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Issue of other series of bonds
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2
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Execution of Senior Note Indenture
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3
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Issue of Senior Notes of Salem Series 2004A
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3
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Issue of Salem Series 2004A bonds pursuant to Article Thirteen
of the Senior Note Indenture
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3
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Issue of collateral bonds of the Salem Series 2004A
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3
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Form of collateral bond of the Salem Series 2004A
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4
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Issue of Senior Notes of Cape May Series 2004A
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7
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Issue of Cape May Series 2004A bonds pursuant to Article
Thirteen of the Senior Note Indenture
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7
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Issue of collateral bonds of the Cape May Series 2004A
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7
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Form of collateral bond of the Cape May Series 2004A
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8
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Issue of Senior Notes of Cape May Series 2004B
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11
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Issue of Cape May Series 2004B bonds pursuant to Article
Thirteen of the Senior Note Indenture
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11
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Issue of collateral bonds of the Cape May Series 2004B
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11
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Form of collateral bond of the Cape May Series 2004B
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12
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Trustee's Authentication Certificate
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15
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Supplemental Indenture
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15
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Compliance with legal requirements
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15
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GRANT
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15
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DESCRIPTION OF PROPERTY
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16
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APPURTENANCES, ETC.
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16
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HABENDUM
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17
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ENCUMBRANCES
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17
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TRUST
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17
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SEC. 1.
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Creation of Bonds of the Salem Series 2004A
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17
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Date of Maturity
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17
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Interest Rate
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18
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Redemption
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18
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SEC. 2.
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Creation of Bonds of the Cape May Series 2004A
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19
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Date of Maturity
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19
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Interest Rate
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20
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Redemption
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20
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SEC. 3.
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Creation of Bonds of the Cape May Series 2004B
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21
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- i -
_____________________________________________________________________________________________________________
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Date of Maturity
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21
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Interest Rate
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21
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Redemption
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22
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SEC. 4.
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Issuance of Collateral Bonds
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23
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SEC. 5.
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Approval of Supplemental Indenture by Board of Public
Utilities,
State of New Jersey not to be construed as approval of other
acts
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23
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SEC. 6.
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Supplemental Indenture and Original Indenture to be construed
as
one instrument
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24
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Limitation on rights of others
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24
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Trustee assumes no responsibility for correctness of recitals of
fact
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24
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Execution in counterparts
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24
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TESTIMONIUM
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25
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SIGNATURES AND SEALS
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26
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ACKNOWLEDGEMENTS
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27
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*The Table of Contents shall not be deemed to be any part of the
Indenture Supplemental to Mortgage and Deed of Trust.
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- ii -
_____________________________________________________________________________________________________________
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SUPPLEMENTAL INDENTURE, dated as of August 10, 2004 for convenience
of reference, and effective from the time of execution and delivery
hereof, made and entered into by and between ATLANTIC CITY ELECTRIC
COMPANY, a corporation of the State of New Jersey (hereinafter
sometimes called the "Company"), party of the first part, and THE
BANK OF NEW YORK (formerly Irving Trust Company), a corporation of
the State of New York, as Trustee (hereinafter sometimes called the
"Trustee"), party of the second part.
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WHEREAS, the Company has heretofore executed and delivered to the
Trustee its Mortgage and Deed of Trust, dated January 15, 1937
(hereinafter referred to as the "Mortgage"), for the security of
all bonds of the Company outstanding thereunder, and by said
Mortgage conveyed to the Trustee, upon certain trusts, terms and
conditions, and with and subject to certain provisos and covenants
therein contained, all and singular the property, rights and
franchises which the Company then owned or should thereafter
acquire, excepting any property expressly excepted by the terms of
the Mortgage; and
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WHEREAS, the Company has heretofore executed and delivered to the
Trustee an Indenture Supplemental to Mortgage and Deed of Trust,
dated as of June 1, 1949, an Indenture Supplemental to
Mortgage and Deed of Trust, dated as of July 1, 1950, an
Indenture Supplemental to Mortgage and Deed of Trust, dated as of
November 1, 1950, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of March 1, 1952, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
January 1, 1953, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of March 1, 1954, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
March 1, 1955, an Indenture Supplemental to Mortgage and Deed
of Trust, dated as of January 1, 1957, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
April 1, 1958, an Indenture Supplemental to Mortgage and Deed
of Trust, dated as of April 1, 1959, an Indenture Supplemental
to Mortgage and Deed of Trust, dated as of March 1, 1961, an
Indenture Supplemental to Mortgage and Deed of Trust, dated as of
July 1, 1962, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of March 1, 1963, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
February 1, 1966, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of April 1, 1970, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
September 1, 1970, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of May 1, 1971, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
April 1, 1972, an Indenture Supplemental to Mortgage and Deed
of Trust, dated as of June 1, 1973, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
January 1, 1975, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of May 1, 1975, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
December 1, 1976, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of January 1, 1980, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of May 1,
1981, an Indenture Supplemental to Mortgage and Deed of Trust,
dated as of November 1, 1983, an Indenture Supplemental to
Mortgage and Deed of Trust, dated as of April 15, 1984, an
Indenture Supplemental to Mortgage and Deed of Trust, dated as of
July 15, 1984, an Indenture Supplemental to Mortgage and Deed
of Trust, dated as of October 1, 1985, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of May 1,
1986, an Indenture Supplemental to Mortgage and Deed of Trust,
dated as of July 15, 1987, an Indenture Supplemental to
Mortgage and Deed of Trust, dated as of October 1, 1989, an
Indenture Supplemental to Mortgage and Deed of Trust, dated as of
March 1, 1991, an Indenture
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_____________________________________________________________________________________________________________
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Supplemental to Mortgage and Deed of Trust, dated as of
May 1, 1992, and an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of January 1, 1993, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
August 1, 1993, an Indenture Supplemental to Mortgage and Deed
of Trust, dated as of September 1, 1993, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
November 1, 1993, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of June 1, 1994, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
October 1, 1994, an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of November 1, 1994, an Indenture
Supplemental to Mortgage and Deed of Trust, dated as of
March 1, 1997, and an Indenture Supplemental to Mortgage and
Deed of Trust, dated as of April 1, 2004, such instruments amending
and supplementing the Mortgage in certain respects (the Mortgage,
as so amended and supplemented, being hereinafter called the
"Original Indenture") and conveying to the Trustee, upon certain
trusts, terms and conditions, and with and subject to certain
provisos and covenants therein contained, certain property rights
and property therein described; and
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WHEREAS, in addition to the property described in the Original
Indenture, the Company has acquired certain property rights and
property hereinafter described and has covenanted in Section 42 of
the Original Indenture to execute and deliver such further
instruments and do such further acts as may be necessary or proper
to make subject to the lien thereof any property thereafter
acquired and intended to be subject to such lien; and
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WHEREAS, the Company represents that no default has occurred under
any of the provisions of the Original Indenture; and
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WHEREAS, the Original Indenture provides that bonds issued
thereunder may be issued in one or more series and further provides
that, with respect to each series, the rate of interest, the date
or dates of maturity, the dates for the payment of interest, the
terms and rates of optional redemption, and other terms and
conditions shall be determined by the Board of Directors of the
Company prior to the authentication thereof; and
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WHEREAS, Section 121 of the Original Indenture provides that any
power, privilege or right expressly or impliedly reserved to or in
any way conferred upon the Company by any provision of the Original
Indenture, whether such power, privilege or right is in any way
restricted or is unrestricted, may be in whole or in part waived or
surrendered or subjected to any restriction if at the time
unrestricted or to additional restriction if already restricted,
and that the Company may enter into any further covenants,
limitations or restrictions for the benefit of any one or more
series of bonds issued under the Original Indenture and provide
that a breach thereof shall be equivalent to a default under the
Original Indenture, or the Company may cure any ambiguity or
correct or supplement any defective or inconsistent provisions
contained in the Original Indenture or in any indenture
supplemental to the Original Indenture, by an instrument in
writing, properly executed, and that the Trustee is authorized to
join with the Company in the execution of any such instrument or
instruments; and
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WHEREAS, the Company has heretofore, from time to time in
accordance with the provisions of the Original Indenture, issued
bonds of various series and in various amounts and, of the bonds so
issued, Four Hundred Thirty-Seven Million Four Hundred Sixty-Five
Thousand Dollars ($437,465,000) aggregate principal amount is
outstanding at the date hereof; and
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- 2 -
_____________________________________________________________________________________________________________
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WHEREAS, the Company has entered into an Indenture, dated as of
April 1, 2004 (the "Senior Note Indenture"), with The Bank of New
York, as trustee (the "Senior Note Trustee"), providing for the
issuance thereunder of the Company's senior debentures, notes or
other evidences of indebtedness ("Senior Notes"); and
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WHEREAS, the Company has determined to issue under and pursuant to
the Senior Note Indenture a series of Senior Notes in the principal
amount of $23,150,000, to be known as the Senior Notes, Salem
Series 2004A due June 1, 2029 (hereinafter called "Senior Notes of
Salem Series 2004A"); and
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WHEREAS, pursuant to Article Thirteen of the Senior Note Indenture,
the Company wishes to issue to the Senior Note Trustee, as security
for the Senior
Notes of Salem Series 2004A, a new series of
bonds under the Original Indenture (i) that have an aggregate
principal amount equal to the principal amount of the Senior Notes
of Salem Series 2004A, (ii) that have a stated maturity date that
is the same as the stated maturity of the Senior Notes of Salem
Series 2004A, (iii) that bear interest at a rate equal to the
interest rate borne by the Senior Notes of Salem Series 2004A, (iv)
that have interest payment dates that are the same as the interest
payment dates of the Senior Notes of Salem Series 2004A, (v) that
contain the same redemption provisions as the Senior Notes of Salem
Series 2004A and (vi) that in all other material respects conform
as nearly as is practicable to the terms of the Senior Notes of
Salem Series 2004A; and
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WHEREAS, for such foregoing purposes the Company, by appropriate
corporate action in conformity with the terms of the Original
Indenture, has duly determined to create a new series of bonds
under the Original Indenture to be entitled and designated as
"First Mortgage Bonds, Salem Collateral Series 2004A due June 1,
2029" (herein sometimes referred to as the "collateral bonds of the
Salem Series 2004A"); and
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WHEREAS, each of the fully registered collateral bonds of the Salem
Series 2004A is to be substantially in the following form, to
wit:
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- 3 -
_____________________________________________________________________________________________________________
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THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR TRUSTEE
UNDER THE INDENTURE, DATED AS OF APRIL 1, 2004, AS SUPPLEMENTED,
BETWEEN ATLANTIC CITY ELECTRIC COMPANY AND THE BANK OF NEW YORK, AS
TRUSTEE
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(FORM OF BOND)
(FACE)
ATLANTIC CITY ELECTRIC COMPANY
FIRST MORTGAGE BOND
Salem Collateral Series 2004A due June 1, 2029
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ATLANTIC CITY ELECTRIC COMPANY, a corporation of the State of New
Jersey (hereinafter called the "Company"), for value received,
hereby promises to pay to The Bank of New York, as trustee under
the Senior Note Indenture (as hereinafter defined), or registered
assigns, the principal sum of
Dollars on June 1, 2029, at the office or agency of the Company in
the Borough of Manhattan, The City of New York in lawful money of
the United States of America, and to pay interest thereon at such
rate as is payable from time to time on the corresponding Senior Notes
of Salem Series 2004A (as hereinafter
defined), payable at such times as interest is payable on such
Senior Notes of Salem Series 2004A, in like money, at said office
or agency, until the Company's obligation with respect to the
payment of such principal shall have been discharged. Interest on
this bond will accrue during the same periods as interest accrues
from time to time on the Senior Notes of Salem Series 2004A.
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Under an Indenture dated as of April 1, 2004 (hereinafter sometimes
referred to as the "Senior Note Indenture"), between the Company
and The Bank of New York, as trustee (hereinafter sometimes called
the "Senior Note Trustee"), the Company will issue, concurrently
with the issuance of this bond, an issue of senior notes under the
Senior Note Indenture entitled Senior Notes, Salem Series 2004A due
June 1, 2029 (the "Senior Notes of Salem Series 2004A"). Pursuant
to Article Thirteen of the Senior Note Indenture, this bond is
issued to the Senior Note Trustee to secure any and all obligations
of the Company under the Senior Notes of Salem Series 2004A.
Payment or deemed payment of principal of, or premium, if any, or
interest on, the Senior Notes of Salem Series 2004A shall
constitute payments on this bond.
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This bond shall not become valid or obligatory for any purpose
until The Bank of New York, the trustee under the Mortgage, or its
successor thereunder, shall have signed the form of authentication
certificate endorsed hereon.
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Reference is made to the further provisions of this bond set forth
on the reverse hereof and such further provisions shall for all
purposes have the same effect as though fully set forth at this
place.
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- 4 -
_____________________________________________________________________________________________________________
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IN WITNESS WHEREOF, ATLANTIC CITY ELECTRIC COMPANY has caused this
bond to be executed in its name by the signature or a facsimile
thereof of its President or one of its Vice Presidents and its
corporate seal, or a facsimile thereof, to be impressed or
imprinted hereon and attested by the signature, or a facsimile
thereof, of its Secretary or one of its Assistant Secretaries.
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ATLANTIC CITY ELECTRIC COMPANY
By: ________________________________
[Vice]
President
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Attest:
_________________________________
[Assistant] Secretary
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(FORM OF BOND)
(REVERSE)
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This bond is one of an issue of bonds of the Company, issuable in
series, and is one of a series known as its "First Mortgage Bonds,
Salem Collateral Series 2004A due June 1, 2029" (hereinafter called
"Collateral Bonds of Salem Series 2004A"), all bonds of all series
issued and to be issued under and equally secured (except insofar
as any sinking fund, established in accordance with the provisions
of the Mortgage hereinafter mentioned, may afford additional
security for the bonds of any particular series) by a Mortgage and
Deed of Trust (herein, together with any indentures supplemental
thereto, called the Mortgage), dated January 15, 1937, executed by
the Company to THE BANK OF NEW YORK, as Trustee, to which Mortgage
reference is made for a description of the property mortgaged and
pledged, the nature and extent of the security, the rights of the
holders of the bonds in respect thereof, the duties and immunities
of the Trustee, and the terms and conditions upon which the bonds
are secured. With the consent of the Company and to the extent
permitted by and as provided in the Mortgage, the rights and
obligations of the Company and/or of the holders of the bonds
and/or coupons and/or the terms and provisions of the Mortgage
and/or of any instruments supplemental thereto may be modified or
altered by affirmative vote of the holders of at least seventy-five
per centum (75%) in principal amount of the bonds affected by such
modification or alteration then outstanding under the Mortgage
(excluding bonds disqualified from voting by reason of the
Company's interest therein as provided in the Mortgage); provided
that no such modification or alteration shall permit the extension
of the maturity of the principal of this bond or the reduction in
the rate of interest hereon or any other modification in the terms
of payment of such principal or interest without the consent of the
holder hereof.
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Upon any payment or deemed payment of the principal of, premium, if
any, and interest on all or any portion of the Senior Notes of
Salem Series 2004A (and to the extent of such payment or deemed
payment), whether at maturity or prior to maturity by redemption,
upon acceleration or otherwise, or upon provision for the payment
thereof having been made in accordance with Section 702 of the
Senior Note Indenture, the obligation of the Company to make the
corresponding payment of principal, premium, if any, or interest on
the Collateral Bonds of
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- 5 -
_____________________________________________________________________________________________________________
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Salem Series 2004A shall be deemed to be satisfied and
discharged. The Trustee may at any time and all times conclusively
presume that the obligation of the Company to make payments with
respect to the principal of, premium, if any, and interest on the
Collateral Bonds of Salem Series 2004A, insofar as such payments at
the time have become due, has been fully satisfied and discharged
pursuant to the foregoing sentence unless and until the Trustee
shall have received a written notice from the Senior Note Trustee
signed by one of its officers (i) stating that timely payment of
principal of or premium or interest on, the Senior Notes of Salem
Series 2004A has not been so made or deemed made and (ii) providing
the details of such nonpayment.
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This bond is redeemable (i) on such dates, in such principal
amounts and at the redemption prices as the corresponding Senior
Notes of Salem Series 2004A and (ii) upon written demand of the
Senior Note Trustee following the occurrence of an Event of Default
under the Senior Note Indenture and the acceleration of the
corresponding Senior Notes of Salem Series 2004A as provided in
Section 802(a) or 802(b) of the Senior Note Indenture.
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As provided in Section 1308 of the Senior Note Indenture, from and
after the Release Date (as defined in the Senior Note Indenture),
the obligation of the Company with respect to this bond shall be
deemed to be satisfied and discharged, this bond shall cease to
secure in any manner the Senior Notes of Salem Series 2004A or any
other senior notes outstanding under the Senior Note Indenture and,
pursuant to Section 1308 of the Senior Note Indenture, the Senior
Note Trustee shall forthwith deliver this bond to the Company or
the Trustee (as directed by Company Order (as defined in the Senior
Note Indenture)).
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The principal hereof may be declared or may become due prior to the
express date of the maturity hereof on the conditions, in the
manner and at the time set forth in the Mortgage, upon the
occurrence of a completed default as in the Mortgage provided.
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The Collateral Bonds of Salem Series 2004A are issuable only as
registered bonds without coupons in denominations of $1,000 and
authorized multiples thereof. This bond shall not be assignable or
transferable except as permitted or required by Section 1307 of the
Senior Note Indenture.
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The Company and the Trustee 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 principal or
(subject to the provisions of the Mortgage) interest hereon and for
all other purposes and the Company and the Trustee shall not be
affected by any notice to the contrary.
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No recourse shall be had for the payment of the principal of or
interest on this bond against any incorporator or any past, present
or future subscriber to the capital stock, shareholder, officer or
director, as such, of the Company or of any successor corporation,
either directly or through the Company or any successor
corporation, under any rule of law, statute or constitution or by
the enforcement of any assessment or otherwise, all such liability
of incorporators, subscribers, shareholders, officers and
directors, as such, being released by the holder or owner hereof by
the acceptance of this bond and being likewise waived and released
by the terms of the Mortgage.
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(END OF FORM OF COLLATERAL BONDS OF SALEM SERIES 2004A)
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- 6 -
_____________________________________________________________________________________________________________
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AND WHEREAS, the Company has determined to issue under and pursuant
to the Senior Note Indenture a series of Senior Notes in the
principal amount of $25,000,000, to be known as the Senior Notes,
Cape May Series 2004A due November 1, 2029 (hereinafter called
"Senior Notes of Cape May Series 2004A"); and
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WHEREAS, pursuant to Article Thirteen of the Senior Note Indenture,
the Company wishes to issue to the Senior Note Trustee, as security
for the Senior Notes of Cape May Series 2004A, a new series of
bonds under the Original Indenture (i) that have an aggregate
principal amount equal to the principal amount of the Senior Notes
of Cape May Series 2004A, (ii) that have a stated maturity date
that is the same as the stated maturity of the Senior Notes of Cape
May Series 2004A, (iii) that bear interest at a rate equal to the
interest rate borne by the Senior Notes of Cape May Series 2004A,
(iv) that have interest payment dates that are the same as the
interest payment dates of the Senior Notes of Cape May Series
2004A, (v) that contain the same redemption provisions as the
Senior Notes of Cape May Series 2004A and (vi) that in all other
material respects conform as nearly as is practicable to the terms
of the Senior Notes of Cape May Series 2004A; and
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WHEREAS, for such foregoing purposes the Company, by appropriate
corporate action in conformity with the terms of the Original
Indenture, has duly determined to create a new series of bonds
under the Original Indenture to be entitled and designated as
"First Mortgage Bonds, Cape May Collateral Series 2004A due
November 1, 2029" (herein sometimes referred to as the "collateral
bonds of the Cape May Series 2004A"); and
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WHEREAS, each of the fully registered collateral bonds of the Cape
May Series 2004A is to be substantially in the following form, to
wit:
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- 7 -
_____________________________________________________________________________________________________________
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THIS BOND IS NOT TRANSFERABLE EXCEPT TO A SUCCESSOR TRUSTEE
UNDER THE INDENTURE, DATED AS OF APRIL 1, 2004, AS SUPPLEMENTED,
BETWEEN ATLANTIC CITY ELECTRIC COMPANY AND THE BANK OF NEW YORK, AS
TRUSTEE
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(FORM OF BOND)
(FACE)
ATLANTIC CITY ELECTRIC COMPANY
FIRST MORTGAGE BOND
Cape May Collateral Series 2004A due November 1, 2029
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ATLANTIC CITY ELECTRIC COMPANY, a corporation of the State of New
Jersey (hereinafter called the "Company"), for value received,
hereby promises to pay to The Bank of New York, as trustee under
the Senior Note Indenture ( as hereinafter
defined), or registered assigns, the principal sum of
Dollars on November 1, 2029, at the office or agency of the Company
in the Borough of Manhattan, The City of New York in lawful money
of the United States of America, and to pay interest thereon at
such rate as is payable from time to time on the corresponding
Senior Notes of Cape May 2004A (as hereinafter defined), payable at
such times as interest is payable on such Senior Notes of Cape May
Series 2004A, in like money, at said office or agency, until the
Company's obligation with respect to the payment of such principal
shall have been discharged. Interest on this bond will accrue
during the same periods as interest accrues from time to time on
the Senior Notes of Cape May 2004A.
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Under an Indenture dated as of April 1, 2004 (hereinafter sometimes
referred to as the "Senior Note Indenture"), between the Company
and The Bank of New York, as trustee (hereinafter sometimes called
the "Senior Note Trustee"), the Company will issue, concurrently
with the issuance of this bond, an issue of senior notes under the
Senior Note Indenture entitled Senior Notes, Cape May Series 2004A
due November 1, 2029 (the "Senior Notes of Cape May Series 2004A").
Pursuant to Article Thirteen of the Senior Note Indenture, this
bond is issued to the Senior Note Trustee to secure any and all
obligations of the Company under the Senior Notes of Cape May
Series 2004A. Payment or deemed payment of principal of, or
premium, if any, or interest on, the Senior Notes of Cape May
Series 2004A shall constitute payments on this bond.
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This bond shall not become valid or obligatory for any purpose
until The Bank of New York, the trustee under the Mortgage, or its
successor thereunder, shall have signed the form of authentication
certificate endorsed hereon.
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Reference is made to the further provisions of this bond set forth
on the reverse hereof and such further provisions shall for all
purposes have the same effect as though fully set forth at this
place.
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- 8 -
_____________________________________________________________________________________________________________
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IN WITNESS WHEREOF, ATLANTIC CITY ELECTRIC COMPANY has caused this
bond to be executed in its name by the signature or a facsimile
thereof of its President or one of its Vice Presidents and its
corporate seal, or a facsimile thereof, to be impressed or
imprinted hereon and attested by the signature, or a facsimile
thereof, of its Secretary or one of its Assistant Secretaries.
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ATLANTIC CITY ELECTRIC COMPANY
By: ________________________________
[Vice]
President
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Attest:
_________________________________
[Assistant] Secretary
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(FORM OF BOND)
(REVERSE)
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This bond is one of an issue of bonds of the Company, issuable in
series, and is one of a series known as its "First Mortgage Bonds,
Cape May Collateral Series 2004A due November 1, 2029" (hereinafter
called "Collateral Bonds of Cape May Series 2004A"), all bonds of
all series issued and to be issued under and equally secured
(except insofar as any sinking fund, established in accordance with
the provisions of the Mortgage hereinafter mentioned, may afford
additional security for the bonds of any particular series) by a
Mortgage and Deed of Trust (herein, together with any indentures
supplemental thereto, called the Mortgage), dated January 15, 1937,
executed by the Company to THE BANK OF NEW YORK, as Trustee, to
which Mortgage reference is made for a description of the property
mortgaged and pledged, the nature and extent of the security, the
rights of the holders of the bonds in respect thereof, the duties
and immunities of the Trustee, and the terms and conditions upon
which the bonds are secured. With the consent of the Company and to
the extent permitted by and as provided in the Mortgage, the rights
and obligations of the Company and/or of the holders of the bonds
and/or coupons and/or the terms and provisions of the Mortgage
and/or of any instruments supplemental thereto may be modified or
altered by affirmative vote of the holders of at least seventy-five
per centum (75%) in principal amount of the bonds affected by such
modification or alteration then outstanding under the Mortgage
(excluding bonds disqualified from voting by reason of the
Company's interest therein as provided in the Mortgage); provided
that no such modification or alteration shall permit the extension
of the maturity of the principal of this bond or the reduction in
the rate of interest hereon or any other modification in the terms
of payment of such principal or interest without the consent of the
holder hereof.
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Upon any payment or deemed payment of the principal of, premium, if
any, and interest on all or any portion of the Senior Notes of Cape
May Series 2004A (and to the extent of such payment or deemed
payment), whether at maturity or prior to maturity by redemption,
upon acceleration or otherwise, or upon provision for the payment
thereof having been made in accordance with Section 702 of the
Senior Note Indenture, the obligation of the Company to make the
corresponding payment of principal, premium, if any, or interest on
the Collateral Bonds of
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Cape May Series 2004A shall be deemed to be satisfied and
discharged. The Trustee may at any time and all times conclusively
presume that the obligation of the Company to make payments with
respect to the principal of, premium, if any, and interest on the
Collateral Bonds of Cape May Series 2004A, insofar as such payments
at the time have become due, has been fully satisfied and
discharged pursuant to the foregoing sentence unless and until the
Trustee shall have received a written notice from the Senior Note
Trustee signed by one of its officers (i) stating that timely
payment of principal of or premium or interest on, the Senior Notes
of Cape May Series 2004A has not been so made or deemed made and
(ii) providing the details of such nonpayment.
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This bond is redeemable (i) on such dates, in such principal
amounts and at the redemption prices as the corresponding Senior
Notes of Cape May Series 2004A and (ii) upon written demand of the
Senior Note Trustee following the occurrence of an Event of Default
under the Senior Note Indenture and the acceleration of the
corresponding Senior Notes of Cape May Series 2004A as provided in
Section 802(a) or 802(b) of the Senior Note Indenture.
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As provided in Section 1308 of the Senior Note Indenture, from and
after the Release Date (as defined in the Senior Note Indenture),
the obligation of the Company with respect to this bond shall be
deemed to be satisfied and discharged, this bond shall cease to
secure in any manner the Senior Notes of Cape May Series 2004A or
any other senior notes outstanding under the Senior Note Indenture
and, pursuant to Section 1308 of the Senior Note Indenture, the
Senior Note Trustee shall forthwith deliver this bond to the
Company or the Trustee (as directed by Company Order (as defined in
the Senior Note Indenture)).
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The principal hereof may be declared or may become due prior to the
express date of the maturity hereof on the conditions, in the
manner and at the time set forth in the Mortgage, upon the
occurrence of a completed default as in the Mortgage provided.
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The Collateral Bonds of Cape May Series 2004A are issuable only as
registered bonds without coupons in denominations of $1,000 and
authorized multiples thereof. This bond shall not be assignable or
transferable except as permitted or required by Section 1307 of the
Senior Note Indenture.
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The Company and the Trustee 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 principal or
(subject to the provisions of the Mortgage) interest hereon and for
all other purposes and the Company and the Trustee shall not be
affected by any notice to the contrary.
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No recourse shall be had for the payment of the principal of or
interest on this bond against any incorporator or any past, present
or future subscriber to the capital stock, shareholder, officer or
director, as such, of the Company or of any successor corporation,
either directly or through the Company or any successor
corporation, under any rule of law, statute or constitution or by
the enforcement of any assessment or otherwise, all such liability
of incorporators, subscribers, shareholders, officers and
directors, as such, being released by the holder or owner hereof by
the acceptance of this bond and being likewise waived and released
by the terms of the Mortgage.
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(END OF FORM OF COLLATERAL BONDS OF CAPE MAY SERIES 2004A)
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AND WHEREAS, the Company has determined to issue under and pursuant
to the Senior Note Indenture a series of Senior Notes in the
principal amount of $6,500,000, to be known as the Senior Notes,
Cape May Series 2004B due November 1, 2029 (hereinafter called
"Senior Notes of Cape May Series 2004B"); and
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WHEREAS, pursuant to Article Thirteen of the Senior Note Indenture,
the Company wishes to issue to the Senior Note Trustee, as security
for the Senior Notes of Cape May Series 2004B, a new series of
bonds under the Original Indenture (i) that have an aggregate
principal amount equal to the principal amount of the Senior Notes
of Cape May Series 2004B, (ii) that have a stated maturity date
that is the same as the stated maturity of the Senior Notes of Cape
May Series 2004B, (iii) that bear interest at a rate equal to the
interest rate borne by the Senior Notes of Cape May Series 2004B,
(iv) that have interest payment dates that are the same as the
interest payment dates of the Senior Notes of Cape May Series
2004B, (v) that contain the same redemptio
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