Common use of Modification of the Indenture Clause in Contracts

Modification of the Indenture. (a) Section 9.01(d) of the Base Indenture is hereby deleted in its entirety and replaced with the following, solely for purposes of the Securities to be issued hereunder: (i) “(d) to add to the covenants of the Company, the Guarantor or any Subsidiary Guarantor for the benefit of the holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company, the Guarantor or any Subsidiary Guarantor;” (b) Section 9.01 of the Base Indenture is hereby amended to add a new clause (h) as follows: (i) “(h) to release the Guarantor or to add or release a Subsidiary Guarantor as required or permitted by this Indenture;” (c) The proviso in the first paragraph of Section 9.02 of the Base Indenture is hereby amended as follows, solely for purposes of the Securities to be issued hereunder: (i) “provided, however, that no such supplemental indenture shall, without the consent of the holders of each Security then Outstanding and affected thereby, (i) extend the fixed maturity of any Securities of any series, or reduce the principal amount thereof, or reduce the rate or extend the time for payment of interest thereon, or reduce any premium payable upon the redemption thereof, (ii) release the Guarantor or any Subsidiary Guarantor from any of their respective obligations under their respective guarantees or this Indenture other than in accordance with the terms of this Indenture or (iii) reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture.”

Modification of the Indenture. (a) Section 9.01(d) of the Base Indenture is hereby deleted in its entirety and replaced with the following, solely for purposes of the Securities to be issued hereunder: (i) “(d) to add to the covenants of the Company, the Guarantor or any Subsidiary Guarantor for the benefit of the holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company, the Guarantor or any Subsidiary Guarantor;” (b) Section 9.01 of the Base Indenture is hereby amended to add a new clause (h) as follows: (i) “(h) to release the Guarantor or to add or release a Subsidiary Guarantor as required or permitted by this Indenture;” (c) The proviso in the first paragraph of Section 9.02 of the Base Indenture is hereby amended as follows, solely for purposes of the Securities to be issued hereunder: (i) “provided, however, that no such supplemental indenture shall, without the consent of the holders of each Security then Outstanding and affected thereby, (i) extend the fixed maturity of any Securities of any series, or reduce the principal amount thereof, or reduce the rate or extend the time for payment of interest thereon, or reduce any premium payable upon the redemption thereof, (ii) release the Guarantor or any Subsidiary Guarantor from any of their respective obligations under their respective guarantees or this Indenture other than in accordance with the terms of this Indenture or (iii) reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture.”

Modification of the Indenture. (a) Section 9.01(d) The indenture provides that we and the trustee may enter into supplemental indentures without the consent of the Base Indenture is hereby deleted in its entirety and replaced with holders of debt securities to, among other things: • evidence the following, solely for purposes assumption by a successor entity of the Securities to be issued hereunder: (i) “(d) to our obligations; • add to the our covenants of the Company, the Guarantor or any Subsidiary Guarantor for the benefit of the holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securitiesdebt securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right rights or power herein conferred upon the Companyus; • add any additional events of default; • add to, the Guarantor change or eliminate any Subsidiary Guarantor;” (b) Section 9.01 of the Base provisions of the indenture in a manner that will become effective only when there is no outstanding debt security which is entitled to the benefit of the provision as to which the modification would apply; • add guarantees with respect to or secure any debt securities; • establish the forms or terms of debt securities of any series; • evidence and provide for the acceptance of appointment by a successor trustee and add to or change any of the provisions of the indenture as is necessary for the administration of the trusts by more than one trustee; • cure any ambiguity or correct any inconsistency or defect in the indenture; • modify, eliminate or add to the provisions of the indenture as shall be necessary to effect the qualification of the indenture under the Trust Indenture is hereby amended Act of 1939 or under any similar federal statute later enacted, and to add a new clause (h) to the indenture such other provisions as follows: (i) “(h) may be expressly required by the Trust Indenture Act; and • make any other provisions with respect to release matters or questions arising under the Guarantor or to add or release a Subsidiary Guarantor as required or permitted by this Indenture;” (c) The proviso in the first paragraph of Section 9.02 indenture that will not be inconsistent with any provision of the Base Indenture is hereby amended indenture as follows, solely for purposes long as the new provisions do not adversely affect the interests of the Securities holders of any outstanding debt securities of any series created prior to be issued hereunder: (i) “providedthe modification. The indenture also provides that we and the trustee may, however, that no with the consent of the holders of not less than a majority in aggregate principal amount of debt securities of each series of debt securities affected by such supplemental indenture shallthen outstanding, add any provisions to, or change in any manner, eliminate or modify in any way the provisions of, the indenture or any supplemental indenture or modify in any manner the rights of the holders of the debt securities. We and the trustee may not, however, without the consent of the holders holder of each Security then Outstanding and outstanding debt security affected thereby, (i) : • extend the fixed final maturity of any Securities of any series, or debt security; • reduce the principal amount thereofor premium, or if any; • reduce the rate or extend the time for of payment of interest thereoninterest; • reduce the amount of the principal of any debt security issued with an original issue discount that is payable upon acceleration; • change the currency in which the principal, or reduce and any premium payable upon or interest, is payable; • impair the redemption thereofright to institute suit for the enforcement of any payment on any debt security when due; • if applicable, (ii) release adversely affect the Guarantor right of a holder to convert or any Subsidiary Guarantor from any of their respective obligations under their respective guarantees exchange a debt security; or this Indenture other than in accordance with the terms of this Indenture or (iii) • reduce the aforesaid percentage of Securities, holders of debt securities of any series whose consent is required for any modification of the indenture or for waivers of compliance with or defaults under the indenture with respect to debt securities of that series. The indenture provides that the holders of which are required not less than a majority in aggregate principal amount of the then outstanding debt securities of any series, by notice to consent to the relevant trustee, may on behalf of the holders of the debt securities of that series waive any default and its consequences under the indenture except: • a default in the payment of, any premium and any interest on, or principal of, any such supplemental indenturedebt security held by a nonconsenting holder; or • a default in respect of a covenant or provision of the indenture that cannot be modified or amended without the consent of the holder of each outstanding debt security of each series affected.”

Modification of the Indenture. SECTION 4.01 Each holder of any of the Bonds of the New Series, by his or its acceptance thereof, shall thereby consent, for the purpose and within the meaning and intent of Section 18.02 of the Indenture, that Section 1.32 of the Indenture shall be modified (effective at the time provided in Section 4.02 hereof) to read as follows: "So long as there are outstanding any Bonds of the 1984 Series or any Bonds of any other series subsequently authenticated and delivered hereunder as to which it is so provided in the supplemental indenture establishing said Bonds or modifying this Indenture, the term "minimum provision for depreciation" for each calendar year (or monthly fractions thereof) in the period being computed shall mean an amount by which 15% of the gross operating revenues of the Company derived from the operation of its utility property subject to the lien of the Indenture (after deducting from such operating revenues (a) Section 9.01(d) of the Base Indenture is hereby deleted in its entirety and replaced with the following, solely for purposes of the Securities to be issued hereunder: (i) “(d) to add an amount equal to the covenants cost of electricity purchased, including any standby or service charges or similar charges for electricity and net cost of electricity interchanged, (b) all rentals and lease payments, and (c) the cost of fuel used in the generation of electricity during such period to the extent such cost is included or reflected in operating expense accounts of the Company) exceeds the charges for maintenance, repairs and renewals of such mortgaged utility property included or which should be included in operating expense pursuant to sound accounting practice." SECTION 4.02 The modification of the Guarantor Indenture set forth in Section 4.01 hereof shall become effective without any further approval or any Subsidiary Guarantor for the benefit consent of the holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company, the Guarantor or any Subsidiary Guarantor;” (b) Section 9.01 Bonds of the Base Indenture is hereby amended to add New Series (a) when a new clause (h) as follows: (i) “(h) to release the Guarantor or to add or release a Subsidiary Guarantor as required or permitted by this Indenture;” (c) The proviso in the first paragraph of Section 9.02 of the Base Indenture is hereby amended as follows, solely for purposes of the Securities to be issued hereunder: (i) “provided, however, that no such further supplemental indenture shall, without making it effective shall have been executed with the consent of the holders of each Security then Outstanding and affected thereby, (i) extend the fixed maturity of any Securities of any series, or reduce the not less than 66-2/3% in principal amount thereof, or reduce of the rate or extend Bonds of each other series at the time for payment outstanding or (b) when all Bonds of interest thereonall series issued prior to the First Mortgage Bonds, or reduce any premium payable upon the redemption thereof, (ii) release the Guarantor or any Subsidiary Guarantor from any of their respective obligations under their respective guarantees or this Indenture other than in accordance with the terms 12-5/8% Series due 1999 have ceased to be outstanding. [The remainder of this Indenture or (iii) reduce the aforesaid percentage of Securities, the holders of which are required to consent to any such supplemental indenture.”page intentionally left blank]

Modification of the Indenture. (a) Section 9.01(d) With some exceptions, under the Indenture, the rights and obligations of the Base Indenture is hereby deleted in its entirety Issuer and replaced the rights of the Noteholders may be modified by the Issuer with the following, solely for purposes of the Securities to be issued hereunder: (i) “(d) to add to the covenants of the Company, the Guarantor or any Subsidiary Guarantor for the benefit consent of the holders of all not less than 66-2/3% in aggregate principal amount of the Notes then outstanding under the Indenture; but no modification may be made if it would result in the reduction or withdrawal of the then current ratings of the outstanding Notes and no modification may be made without the consent of the holder of each outstanding note affected thereby if it would (a) change the fixed maturity of any series Note, or the principal amount or interest amount payable thereof, or change the priority of Securities (and if such covenants are payment thereof or reduce the interest rate or the principal thereon or change the place of payment where, or the coin or currency in which, any Note or the interest thereon is payable, or impair the right to be institute the suit for the benefit enforcement of less than all series of Securities, stating that such covenants are expressly being included solely for payment on or after the benefit of such series) maturity thereof; or to surrender any right or power herein conferred upon the Company, the Guarantor or any Subsidiary Guarantor;” (b) Section 9.01 reduce the above-stated percentage of the Base Indenture is hereby amended to add a new clause (h) as follows: (i) “(h) to release the Guarantor or to add or release a Subsidiary Guarantor as required or permitted by this Indenture;” (c) The proviso in the first paragraph of Section 9.02 of the Base Indenture is hereby amended as follows, solely for purposes of the Securities to be issued hereunder: (i) “provided, however, that no such supplemental indenture shallNotes, without the consent of the holders of each Security all Notes then Outstanding and affected thereby, (i) extend the fixed maturity of any Securities of any series, or reduce the principal amount thereof, or reduce the rate or extend the time for payment of interest thereon, or reduce any premium payable upon the redemption thereof, (ii) release the Guarantor or any Subsidiary Guarantor from any of their respective obligations outstanding under their respective guarantees or this Indenture other than in accordance with the terms of this that Indenture or (iiic) reduce modify any of Section 9.02 of the aforesaid Indenture except to increase any percentage or fraction set out in the Indenture or to provide that other provisions of Securities, the holders Indenture cannot be modified or waived without the consent of which are required the holder of each outstanding note affected thereby; or (d) modify or alter the provisions of the proviso to consent the definition of the term "Outstanding" in the Indenture; or (e) permit the creation of any lien ranking prior to or on a parity with the lien of the Indenture with respect to any such supplemental indenturepart of the Pledged Assets or, except as provided in the Indenture, terminate the lien of the Indenture on any property at any time subject to the Indenture or deprive any Noteholder of the Security afforded by the lien of the Indenture. (Section 9.02).”

Modification of the Indenture. SECTION 4.01 Each holder of any of the Bonds of the New Series, by his or its acceptance thereof, shall thereby consent, for the purpose and within the meaning and intent of Section 18.02 of the Indenture, that Section 1.32 of the Indenture shall be modified (effective at the time provided in Section 4.02 hereof) to read as follows: "So long as there are outstanding any Bonds of the 1984 Series or any Bonds of any other series subsequently authenticated and delivered hereunder as to which it is so provided in the supplemental indenture establishing said Bonds or modifying this Indenture, the term "minimum provision for depreciation" for each calendar year (or monthly fractions thereof) in the period being computed shall mean an amount by which 15% of the gross operating revenues of the Company derived from the operation SEVENTY-EIGHTH SUPPLEMENTAL INDENTURE PAGE 28 ANY WRITING, TEXT INITIALS, REVISIONS OR NOTARY SEAL APPEARING OUTSIDE THESE MARGINS MAY DISQUALIFY THIS DOCUMENT FOR RECORDING of its utility property subject to the lien of the Indenture (after deducting from such operating revenues (a) Section 9.01(d) of the Base Indenture is hereby deleted in its entirety and replaced with the following, solely for purposes of the Securities to be issued hereunder: (i) “(d) to add an amount equal to the covenants cost of electricity purchased, including any standby or service charges or similar charges for electricity and net cost of electricity interchanged, (b) all rentals and lease payments, and (c) the cost of fuel used in the generation of electricity during such period to the extent such cost is included or reflected in operating expense accounts of the Company) exceeds the charges for maintenance, repairs and renewals of such mortgaged utility property included or which should be included in operating expense pursuant to sound accounting practice." SECTION 4.02 The modification of the Guarantor Indenture set forth in Section 4.01 hereof shall become effective without any further approval or any Subsidiary Guarantor for the benefit consent of the holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company, the Guarantor or any Subsidiary Guarantor;” (b) Section 9.01 Bonds of the Base Indenture is hereby amended to add New Series (a) when a new clause (h) as follows: (i) “(h) to release the Guarantor or to add or release a Subsidiary Guarantor as required or permitted by this Indenture;” (c) The proviso in the first paragraph of Section 9.02 of the Base Indenture is hereby amended as follows, solely for purposes of the Securities to be issued hereunder: (i) “provided, however, that no such further supplemental indenture shall, without making it effective shall have been executed with the consent of the holders of each Security then Outstanding and affected thereby, (i) extend the fixed maturity of any Securities of any series, or reduce the not less than 66-2/3% in principal amount thereof, or reduce of the rate or extend Bonds of each other series at the time for payment of interest thereon, or reduce any premium payable upon the redemption thereof, (ii) release the Guarantor or any Subsidiary Guarantor from any of their respective obligations under their respective guarantees or this Indenture other than in accordance with the terms of this Indenture outstanding or (iiib) reduce when all Bonds of all series issued prior to the aforesaid percentage First Mortgage Bonds, 12-5/8% Series due 1999 have ceased to be outstanding. SEVENTY-EIGHTH SUPPLEMENTAL INDENTURE PAGE 29 ANY WRITING, TEXT INITIALS, REVISIONS OR NOTARY SEAL APPEARING OUTSIDE THESE MARGINS MAY DISQUALIFY THIS DOCUMENT FOR RECORDING IN WITNESS WHEREOF, Puget Sound Energy, Inc. has caused this Seventy-Eighth Supplemental Indenture to be signed in its corporate name and behalf by its President or one of Securitiesits Vice Presidents or its Treasurer or Assistant Treasurer and its corporate seal to be hereunto affixed and attested by its Secretary or one of its Assistant Secretaries, and State Street Bank and Trust Company in token of its acceptance of the holders trust hereby created has caused this Seventy- Eighth Supplemental Indenture to be signed in its corporate name and behalf by its Vice President or one of which are required its Assistant Vice Presidents, and its corporate seal to consent to any such supplemental indenture.”be hereunto affixed and attested by one of its Vice Presidents, Assistant Vice Presidents or one of its Assistant Secretaries, all on October 31, 2000, but as of the day and year first above written. PUGET SOUND ENERGY, INC. By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ ------------------- ▇▇▇▇▇ ▇. ▇▇▇▇▇, Assistant Treasurer Attest: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ --------------------- ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Secretary [corporate seal] STATE STREET BANK AND TRUST COMPANY By ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ -------------- Attest:

Modification of the Indenture. SECTION 4.01 Each holder of any of the Bonds of the New Series, by his or its acceptance thereof, shall thereby consent, for the purpose and within the meaning and intent of Section 18.02 of the Indenture, that Section 1.32 of the Indenture shall be modified (effective at the time provided in Section 4.02 hereof) to read as follows: "So long as there are outstanding any Bonds of the 1984 Series or any Bonds of any other series subsequently authenticated and delivered hereunder as to which it is so provided in the supplemental indenture establishing said Bonds or modifying this Indenture, the term "minimum provision for depreciation" for each calendar year (or monthly fractions thereof) in the period being computed shall mean an amount by which 15% of the gross operating revenues of the Company derived from the operation of its utility property subject to the lien of the Indenture (after deducting from such operating revenues (a) Section 9.01(d) of the Base Indenture is hereby deleted in its entirety and replaced with the following, solely for purposes of the Securities to be issued hereunder: (i) “(d) to add an amount equal to the covenants cost of electricity purchased, including any standby or service charges or similar charges for electricity and net cost of electricity interchanged, (b) all rentals and lease payments, and (c) the cost of fuel used in the generation of electricity during such period to the extent such cost is included or reflected in operating expense accounts of the Company) exceeds the charges for maintenance, repairs and renewals of such mortgaged utility property included or which should be included in operating expense pursuant to sound accounting practice." SECTION 4.02 The modification of the Guarantor Indenture set forth in Section 4.01 hereof shall become effective without any further approval or any Subsidiary Guarantor for the benefit consent of the holders of all or any series of Securities (and if such covenants are to be for the benefit of less than all series of Securities, stating that such covenants are expressly being included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company, the Guarantor or any Subsidiary Guarantor;” (b) Section 9.01 Bonds of the Base Indenture is hereby amended to add New Series (a) when a new clause (h) as follows: (i) “(h) to release the Guarantor or to add or release a Subsidiary Guarantor as required or permitted by this Indenture;” (c) The proviso in the first paragraph of Section 9.02 of the Base Indenture is hereby amended as follows, solely for purposes of the Securities to be issued hereunder: (i) “provided, however, that no such further supplemental indenture shall, without making it effective shall have been executed with the consent of the holders of each Security then Outstanding and affected thereby, (i) extend the fixed maturity of any Securities of any series, or reduce the not less than 66-2/3% in principal amount thereof, or reduce of the rate or extend Bonds of each other series at the time for payment of interest thereon, or reduce any premium payable upon the redemption thereof, (ii) release the Guarantor or any Subsidiary Guarantor from any of their respective obligations under their respective guarantees or this Indenture other than in accordance with the terms of this Indenture outstanding or (iiib) reduce when all Bonds of all series issued prior to the aforesaid percentage of SecuritiesFirst Mortgage Bonds, the holders of which are required 12-5/8% Series due 1999 have ceased to consent to any such supplemental indenturebe outstanding.”