PG&E CORP (Form: 8-K, Received: 04/12/2004 14:12:48)

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report: April 12, 2004


	Exact Name of
Commission	Registrant	State or other	IRS Employer
File	as specified in	Jurisdiction of	Identification
Number	its charter	Incorporation	Number
1-12609 1-2348	PG&E Corporation Pacific Gas and Electric Company	California California	94-3234914 94-0742640


Pacific Gas and Electric Company 77 Beale Street, P. O. Box 770000 San Francisco, California 94177		PG&E Corporation One Market, Spear Tower, Suite 2400 San Francisco, California 94105

(Address of principal executive offices) (Zip Code)


Pacific Gas and Electric Company (415) 973-7000		PG&E Corporation (415) 267-7000

(Registrant’s telephone number, including area code)

TABLE OF CONTENTS


Item 5. Other Events and Regulation FD Disclosure
Item 7. Financial Statements and Exhibits
SIGNATURE
EXHIBIT INDEX
EXHIBIT 3
EXHIBIT 4

Item 5. Other Events and Regulation FD Disclosure

On April 12, 2004, Pacific Gas and Electric Company’s (Utility) plan of reorganization (Plan) under Chapter 11 of the U.S. Bankruptcy Code became effective. Although the Utility’s operations will no longer be subject to the oversight of the U.S. Bankruptcy Court for the Northern District of California (Bankruptcy Court) where its Chapter 11 case was pending, the Bankruptcy Court will retain jurisdiction to hear and determine disputes arising in connection with the interpretation, implementation or enforcement of (i) the nine-year settlement agreement between the Utility, PG&E Corporation and the California Public Utilities Commission, (ii) the Plan, or (iii) the Bankruptcy Court’s confirmation order.

Upon the effectiveness of the Plan, the Utility paid approximately $8.4 billion in cash to holders of allowed claims under the Plan and deposited approximately $1.8 billion into escrow accounts for the payment of disputed claims. Funds for these payments came from the proceeds of the Utility’s public offering of approximately $6.7 billion of first mortgage bonds, $0.3 billion under an accounts receivable financing facility, $0.8 billion funded by term loans, and $2.4 billion from cash on hand.

In addition approximately $814 million in debt consisting of pollution control bonds that were previously issued for the benefit of the Utility was reinstated and the Utility paid approximately $93 million in preferred stock dividends and sinking fund payments that were in arrears. The Utility’s various series of preferred stock remain outstanding. The preferred stock has an aggregate par value of $421 million, excluding the par value of preferred stock that will be redeemed on April 12, 2004.

Item 7. Financial Statements and Exhibits


Number		Description
3		Restated Articles of Incorporation of Pacific Gas and Electric Company.
4		Second Supplemental Indenture, dated as of April 12, 2004, between Pacific Gas and Electric Company and BNY Western Trust Company.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned thereunto duly authorized.

PG&E CORPORATION

/s/ Christopher P. Johns

Christopher P. Johns
Senior Vice President and Controller

PACIFIC GAS AND ELECTRIC COMPANY

/s/ Dinyar B. Mistry

Dinyar B. Mistry
Vice President and Controller

Dated: April 12, 2004

EXHIBIT INDEX


Number		Description
3		Restated Articles of Incorporation of Pacific Gas and Electric Company.
4		Second Supplemental Indenture, dated as of April 12, 2004, between Pacific Gas and Electric Company and BNY Western Trust Company.

EXHIBIT 3

RESTATED ARTICLES OF INCORPORATION
OF
PACIFIC GAS AND ELECTRIC COMPANY

Gordon R. Smith and Linda Y. H. Cheng certify that:

1. They are the President and the Corporate Secretary, respectively, of Pacific Gas and Electric Company, a California corporation (the "corporation").

2. The Articles of Incorporation of the corporation, as amended to the date of the filing of this certificate, including the amendments set forth herein but not separately filed (and with the omissions required by Section 910 of the Corporations Code) are amended and restated as follows:

FIRST: That the name of said corporation shall be

PACIFIC GAS AND ELECTRIC COMPANY.

SECOND: The purpose of the corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of California other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the California Corporations Code.

The right is reserved to this corporation to amend the whole or any part of these Articles of Incorporation in any respect not prohibited by law.

THIRD: That this corporation shall have perpetual existence.

FOURTH: The corporation elects to be governed by all of the provisions of the General Corporation Law (as added to the California Corporations Code effective January 1, 1977, and as subsequently amended) not otherwise applicable to this corporation under Chapter 23 of said General Corporation Law.

FIFTH: The Board of Directors by a vote of two-thirds of the whole Board may appoint

from the Directors an Executive Committee, which Committee may exercise such powers as may lawfully be conferred upon it by the Bylaws of the Corporation. Such Committee may prescribe rules for its own government and its meetings may be held at such places within or without California as said Committee may determine or authorize.

SIXTH: The liability of the directors of the corporation for monetary damages shall be eliminated to the fullest extent permissible under California law.

SEVENTH: The corporation is authorized to provide indemnification of agents (as defined in Section 317 of the California Corporations Code) through bylaws, resolutions, agreements with agents, vote of shareholders or disinterested directors, or otherwise, in excess of the indemnification otherwise permitted by Section 317 of the California Corporations Code, subject only to the applicable limits set forth in Section 204 of the California Corporations Code.

EIGHTH: The total number of shares which this corporation is authorized to issue is eight hundred eighty-five million (885,000,000) of the aggregate par value of six billion eight hundred seventy-five million dollars ($6,875,000,000). All of these shares shall have full voting rights. The corporation shall be prohibited from issuing nonvoting stock.

Said eight hundred eighty-five million (885,000,000) shares shall be divided into three classes, designated as common stock, first preferred stock and $100 first preferred stock. Eight hundred million (800,000,000) of said shares shall be common stock, of the par value of $5 per share, seventy-five million (75,000,000) of said shares shall be first preferred stock, of the par value of $25 per share, and ten million (10,000,000) of said shares shall be $100 first preferred stock, of the par value of $100 per share.

FIRST PREFERRED STOCK
AND $100 FIRST PREFERRED STOCK

The first preferred stock and $100 first preferred stock each shall be divided into series. The first series of first preferred stock shall consist of four million two hundred eleven thousand six hundred sixty-two (4,211,662) shares and be designated as Six Per Cent First Preferred Stock. The second series of first preferred stock shall consist of one million one hundred seventy-three thousand one hundred sixty-three (1,173,163) shares and be designated as Five and One-Half Per Cent First Preferred Stock. The third series of first preferred stock shall consist of four hundred thousand (400,000) shares and be designated as Five Per Cent First Preferred Stock. The remainder of said first preferred stock, viz., 69,215,175 shares, and all of the $100 first preferred stock may be issued in one or more additional series, as determined from time to

time by the Board of Directors. Except as provided herein, the Board of Directors is hereby authorized to determine and alter the rights, preferences, privileges and restrictions granted to or imposed upon the first preferred stock or $100 first preferred stock or any series thereof with respect to any wholly unissued series of first preferred stock or $100 first preferred stock, and to fix the number of shares of any series of first preferred stock or $100 first preferred stock and the designation of any such series of first preferred stock or $100 first preferred stock. The Board of Directors, within the limits and restrictions stated in any resolution or resolutions of the Board of Directors originally fixing the number of shares constituting any series, may increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series subsequent to the issue of shares of that series.

The owners and holders of shares of said first preferred stock and $100 first preferred stock, when issued as fully paid, are and shall be entitled to receive, from the date of issue of such shares, out of funds legally available therefor, cumulative preferential dividends, when and as declared by the Board of Directors, at the following rates upon the par value of their respective shares, and not more, viz.: Six per cent (6%) per year upon Six Per Cent First Preferred Stock; five and one-half per cent (5-l/2%) per year upon Five and One-Half Per Cent First Preferred Stock; five per cent (5%) per year upon Five Per Cent First Preferred Stock; and upon the shares of each additional series of said first preferred stock and of each series of $100 first preferred stock the dividend rate fixed therefor; and such dividends on both classes of first preferred stock and $100 first preferred stock shall be declared and shall be either paid or set apart for payment before any dividend upon the shares of common stock shall be either declared or paid.

Upon the liquidation or dissolution of this corporation at any time and in any manner, the owners and holders of shares of said first preferred stock and $100 first preferred stock issued as fully paid will be entitled to receive an amount equal to the par value of such shares plus an amount equal to all accumulated and unpaid dividends thereon to and including the date fixed for such distribution or payment before any amount shall be paid to the holders of said common stock.

If any share or shares of first preferred stock and $100 first preferred stock shall at any time be issued as only partly paid, the owners and holders of such partly paid share or shares shall have the right to receive dividends and to share in the assets of this corporation upon its liquidation or dissolution in all respects like the owners and holders of fully paid shares of first preferred stock and $100 first preferred stock, except that such right shall be only in proportion to the amount paid on account of the subscription price for which such partly paid share or shares shall have been issued.

The unissued shares of said first preferred stock and $100 first preferred stock may be offered for subscription or sale or in exchange for property and be issued from time to time upon such terms and conditions as said Board of Directors shall prescribe.

The first three series of said first preferred stock, namely, the Six Per Cent First Preferred Stock, the Five and One-Half Per Cent First Preferred Stock, and the Five Per Cent First Preferred Stock, are not subject to redemption.

Any or all shares of each series of said first preferred stock and $100 first preferred stock other than said first three series of first preferred stock may be redeemed at the option of this corporation, at any time or from time to time, at the redemption price fixed for such series together with accumulated and unpaid dividends at the rate fixed therefor to and including the date fixed for redemption. If less than all the outstanding shares of any such series are to be redeemed, the shares to be redeemed shall be determined pro rata or by lot in such manner as the Board of Directors may determine.

Unless the certificate of determination for any series of the first preferred stock or the $100 first preferred stock shall otherwise provide, notice of every such redemption shall be published in a newspaper of general circulation in the City and County of San Francisco, State of California, and in a newspaper of general circulation in the Borough of Manhattan, City and State of New York, at least once in each of two (2) successive weeks, commencing not earlier than sixty (60) nor later than thirty (30) days before the date fixed for redemption; successive publications need not be made in the same newspaper. A copy of such notice shall be mailed within the same period of time to each holder of record, as of the record date, of the shares to be redeemed, but the failure to mail such notice to any shareholder shall not invalidate the redemption of such shares.

From and after the date fixed for redemption, unless default be made by this corporation in paying the amount due upon redemption, dividends on the shares called for redemption shall cease to accrue, and such shares shall be deemed to be redeemed and shall be no longer outstanding, and the holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the right to receive from this corporation upon surrender of their certificates the amount payable upon redemption without interest. Or, if this corporation shall deposit, on or prior to the date fixed for redemption, with any bank or trust company in the City and County of San Francisco, having capital, surplus and undivided profits aggregating at least five million dollars ($5,000,000), as a trust fund, a sum sufficient to redeem the shares called for redemption, with irrevocable instructions and authority to such bank or trust company to publish or complete the publication of the notice of redemption (if this corporation shall not have theretofore completed publication of such notice), and to pay, on and after the date fixed for redemption, or on and after such earlier date as the Board of Directors may determine, the amount payable upon redemption of such shares, then from and after the date of such deposit (although prior to the date fixed for redemption) such shares shall be deemed to be redeemed; and dividends on such shares shall cease to accrue after the date

fixed for redemption. The said deposit shall be deemed to constitute full payment of the shares to their respective holders and from and after the date of such deposit the shares shall be no longer outstanding, and the holders thereof shall cease to be shareholders with respect to such shares and shall have no rights with respect thereto except the right to receive from said bank or trust company the amount payable upon redemption of such shares, without interest, upon surrender of their certificates therefor, and except, also, any right which such shareholders may then have to exchange or convert such shares prior to the date fixed for redemption. Any part of the funds so deposited which shall not be required for redemption payments because of such exchange or conversion shall be repaid to this corporation forthwith. The balance, if any, of the funds so deposited which shall be unclaimed at the end of six (6) years from the date fixed for redemption shall be repaid to this corporation together with any interest which shall have been allowed thereon; and thereafter the unpaid holders of shares so called for redemption shall have no claim for payment except as against this corporation.

All shares of the first preferred stock and $100 first preferred stock shall rank equally with regard to preference in dividend and liquidation rights, except that shares of different classes or different series thereof may differ as to the amounts of dividends or liquidation payments to which they are entitled, as herein set forth.

COMMON STOCK

When all accrued dividends upon all of the issued and outstanding shares of the first preferred stock and $100 first preferred stock of this corporation shall have been declared and shall have been paid or set apart for payment, but not before, dividends may be declared and paid, out of funds legally available therefor, upon all of the issued and outstanding shares of said common stock.

Upon the liquidation or dissolution of this corporation, after the owners and holders of such first preferred stock and $100 first preferred stock shall have been paid the full amount to which they shall have been entitled under the provisions of these Articles of Incorporation, the owners and holders of such common stock shall be entitled to receive and to have paid to them the entire residue of the assets of this corporation in proportion to the number of shares of said common stock held by them respectively.

If any share or shares of common stock shall at any time be issued as only partly paid, the

owners and holders of such partly paid share or shares shall have the right to receive dividends and to share in the assets of this corporation upon its liquidation or dissolution in all respects like the owners and holders of fully paid shares of common stock, except that such right shall be only in proportion to the amount paid on account of the subscription price for which such partly paid share or shares shall have been issued.

The unissued shares of said common stock may be offered for subscription or sale or in exchange for property and be issued from time to time upon such terms and conditions as said Board of Directors may prescribe.

PROHIBITION AGAINST ASSESSMENTS

Shares of such stock, whether first preferred, $100 first preferred stock or common stock, the subscription price of which shall have been paid in full, whether such price be par or more or less than par, shall be issued as fully paid shares and shall never be subject to any call or assessment for any purpose whatever. Shares of such stock, whether first preferred, $100 first preferred stock or common stock, a part only of the subscription price of which shall have been paid, shall be subject to calls for the unpaid balance of the subscription price thereof. But no call made on partly paid first preferred stock, partly paid $100 first preferred stock or partly paid common stock shall be recoverable by action or be enforceable otherwise than by sale or forfeiture of delinquent stock in accordance with the applicable provisions of the Corporations Code of California.

If at any time, whether by virtue of any amendment of these Articles of Incorporation or any amendment or change of the law of the State of California relating to corporations or otherwise, any assessment shall, in any event whatever, be levied and collected on any subscribed and issued shares of said first preferred stock or $100 first preferred stock after the subscription price thereof shall have been paid in full, the rights of the owners and holders thereof to receive dividends and their rights to share in the assets upon the liquidation or dissolution of this corporation shall, immediately upon the payment of such assessment and by virtue thereof, be increased in the same ratio as the total amount of the assessment or assessments so levied and collected shall bear to the par value of such shares of first preferred stock or $100 first preferred stock.

RESERVES

The Board of Directors of this corporation shall, notwithstanding the foregoing provisions of these Articles of Incorporation, have authority from time to time to set aside, out of

the profits arising from the business of this corporation, such reasonable sums as may in their judgment be necessary and proper for working capital and for usual reserves and surplus.

NINTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 5% REDEEMABLE
FIRST PREFERRED STOCK: The Certificate of Determination of Preferences of the 5% Redeemable First Preferred Stock which is attached hereto as Exhibit 1 is hereby incorporated by reference as Article NINTH of these Articles of Incorporation.

TENTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 5% REDEEMABLE FIRST PREFERRED STOCK, SERIES A: The Certificate of Determination of Preferences of the 5% Redeemable First Preferred Stock, Series A, which is attached hereto as Exhibit 2 is hereby incorporated by reference as Article TENTH of these Articles of Incorporation.

ELEVENTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 4.80%
REDEEMABLE FIRST PREFERRED STOCK: The Certificate of Determination of Preferences of the 4.80% Redeemable First Preferred Stock which is attached hereto as Exhibit 3 is hereby incorporated by reference as Article ELEVENTH of these Articles of Incorporation.

TWELFTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 4.50%
REDEEMABLE FIRST PREFERRED STOCK: The Certificate of Determination of Preferences of the 4.50% Redeemable First Preferred Stock which is attached hereto as Exhibit 4 is hereby incorporated by reference as Article TWELFTH of these Articles of Incorporation.

THIRTEENTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 4.36%
REDEEMABLE FIRST PREFERRED STOCK: The Certificate of Determination of Preferences of the 4.36% Redeemable First Preferred Stock which is attached hereto as Exhibit 5 is hereby incorporated by reference as Article THIRTEENTH of these Articles of Incorporation.

FOURTEENTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 6.57%
REDEEMABLE FIRST PREFERRED STOCK: The Certificate of Determination of Preferences of the 6.57% Redeemable First Preferred Stock which is attached hereto as Exhibit 6 is hereby incorporated by reference as Article FOURTEENTH of these Articles of Incorporation.

FIFTEENTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 7.04%
REDEEMABLE FIRST PREFERRED STOCK: The Certificate of Determination of Preferences of the 7.04% Redeemable First Preferred Stock which is attached hereto as Exhibit 7 is hereby incorporated by reference as Article FIFTEENTH of these Articles of Incorporation.

SIXTEENTH: CERTIFICATE OF DETERMINATION OF PREFERENCES OF THE 6.30%
REDEEMABLE FIRST PREFERRED STOCK: The Certificate of Determination of Preferences of the 6.30% Redeemable First Preferred Stock which is attached hereto as Exhibit 8 is hereby incorporated by reference as Article SIXTEENTH of these Articles of Incorporation.

3. The foregoing amendments and restatement of the Articles of Incorporation were adopted to (1) amend Article Eighth to prohibit the corporation from issuing nonvoting equity securities, which is required by Section 1123(a)(6) of the United States Bankruptcy Code,
(2) to eliminate Article Sixteenth, which previously set forth the Certificate of Determination of Preferences of the 6-7/8% Redeemable First Preferred Stock, to reflect the reduction in the authorized number of shares of that series to zero which occurred upon filing the Certificate of Decrease with respect to such series immediately preceding the filing of the Restated Articles, pursuant to California Corporations Code Section 401(c), and the elimination of that series as an authorized series of the corporation pursuant to California Corporations Code Section 401(f); and (3) to renumber the remaining Articles to reflect the deletion of Article Sixteenth.

4. The amendment to Article Eighth has not been approved by the Board of Directors or the shareholders, for the following reasons. The corporation filed a petition for voluntary bankruptcy under Chapter 11 of the U.S. Bankruptcy Code on April 6, 2001. Under the Confirmation Order dated December 22, 2003, as supplemented by orders dated January 27, 2004 and March 15, 2004, in respect of its plan of reorganization, the corporation is required to (1) amend its Articles of Incorporation to contain the provisions necessary to prohibit the issuance of nonvoting equity securities as required by section 1123(a)(6) of the Bankruptcy Code and as provided in the plan of reorganization and (2) empower the chairman of the board, the president, any vice president, the chief financial officer, the controller, the secretary, the treasurer, any assistant treasurer and any assistant secretary, jointly or severally, to exercise the power and authority to effectuate these provisions of the plan. Pursuant to California Corporations Code Section 1400, any domestic corporation with respect to which a proceeding has been initiated under any applicable statute of the United States, as now existing or hereafter enacted, relating to reorganizations or arrangements of corporations, has full power and authority to put into effect and carry out any plan of reorganization or arrangement and the orders of the court or judge entered in such proceeding and may take any proceeding and do any act provided in the plan or directed by such orders, without further action by its Board of Directors or shareholders,

including without limitation, the authority to amend its articles of incorporation.

5. Amendments to the Articles of Incorporation for the purpose of eliminating the 6-7/8 % Redeemable First Preferred Stock series have been approved by the board of Directors. Pursuant to California Corporations Code Sections 202(e)(3), 203.5(b), 401(c) and 401(f), amendments to the Articles of Incorporation for the purpose of eliminating the 6-7/8 % Redeemable First Preferred Stock series need not be approved by the affirmative vote of the majority of the outstanding shares; accordingly, such amendments and restatement may be adopted with approval of the Board of Directors alone.

We further declare under penalty of perjury under the laws of the State of California that the matters set forth in this certificate are true and correct of our own knowledge.

Date:  April 12, 2004

                                                  /s/ Gordon R. Smith
                                                 ------------------------------
                                                 Gordon R. Smith
                                                 President

                                                  /s/ Linda Y. H. Cheng
                                                 ------------------------------
                                                 Linda Y. H. Cheng
                                                 Corporate Secretary

EXHIBIT 1

PACIFIC GAS AND ELECTRIC COMPANY
CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 5% REDEEMABLE FIRST PREFERRED STOCK

WHEREAS, the Articles of Incorporation of this corporation provide for a class of stock known as First Preferred Stock, issuable from time to time in one or more series, of which a series of such class of stock was issued as the 5% Redeemable First Preferred Stock, $25 par value (herein called the "5% Series"); and

WHEREAS, this corporation has elected to redeem, purchase, or otherwise acquire 1,082,805 shares of the 5% Series from time to time; and

WHEREAS, pursuant to California Corporations Code Section 401(c), this corporation filed a Certificate of Decrease in Number of Shares of Certain Series of First Preferred Stock on March 23, 1994, which amended the Articles of Incorporation to decrease the number of shares constituting the 5% Series from 2,860,977 to 1,778,172 shares; and

WHEREAS, pursuant to California Corporations Code Section 202(e)(3), the 1,082,805 shares constituting the decrease in the 5% Series resumed the status of authorized and unissued shares of First Preferred Stock, $25 par value; and

WHEREAS, it is in the best interest of this corporation to restate the four existing Certificates of Determination of Preferences of the 5% Series to
(i) reflect the reduction in the authorized number of shares of the 5% Series,
(ii) consolidate such existing Certificates of Determination of Preferences into a single Certificate of Determination of Preferences of the 5% Series, and (iii) eliminate the portions of the officers' certificates and verifications which do not set forth any of the rights, preferences, privileges, or restrictions of the 5% Series.

E-1-1

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificates of Determination of Preferences of the 5% Series is hereby approved; and

BE IT FURTHER RESOLVED that the Certificate of Determination of Preferences of the 5% Series is hereby approved and adopted as restated in its entirety as follows:

1,778,172 shares of this corporation's unissued redeemable First Preferred Stock shall constitute a series designated "5% Redeemable First Preferred Stock"; the dividend rate of such shares shall be five per cent per year; such shares shall have no conversion rights; and the redemption price of such shares shall be

$28.25 per share if redeemed on or before July 31, 1953,

$27.75 per share if redeemed thereafter and on or before July 31, 1958,

$27.25 per share if redeemed thereafter and on or before July 31, 1963, and

$26.75 per share if redeemed thereafter.

E-1-2

EXHIBIT 2

PACIFIC GAS AND ELECTRIC COMPANY
CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 5% REDEEMABLE FIRST PREFERRED STOCK,
SERIES A

WHEREAS, this corporation has elected to redeem, purchase, or otherwise acquire 815,678 shares of the 5% Series A from time to time; and

WHEREAS, pursuant to California Corporations Code Section 202(e)(3), the 815,678 shares constituting the decrease in the 5% Series A resumed the status of authorized and unissued shares of First Preferred Stock, $25 par value; and

WHEREAS, it is in the best interest of this corporation to restate the two existing Certificates of Determination of Preferences of the 5% Series A to (i) reflect the reduction in the authorized number of shares of the 5% Series A,
(ii) consolidate such existing Certificates of Determination of Preferences into a single Certificate of Determination of Preferences of the 5% Series A, and
(iii) eliminate the portions of the officers' certificates and verifications which do not set forth any of the rights, preferences, privileges, or restrictions of the 5% Series A.

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificates of Determination of Preferences of the 5% Series A is hereby approved; and

BE IT FURTHER RESOLVED that the Certificate of Determination of Preferences of the 5% Series A is hereby approved and adopted as restated in its entirety as follows:

E-2-1

934,322 shares of this corporation's unissued redeemable First Preferred Stock shall constitute a series designated "5% Redeemable First Preferred Stock, Series A"; the dividend rate of such shares shall be five per cent per year; such shares shall have no conversion rights; and the redemption price of such shares shall be

$28.25   per share if redeemed on or before July 31, 1953,
$27.75   per share if redeemed thereafter and on or before July 31, 1958,
$27.25   per share if redeemed thereafter and on or before July 31, 1963, and
$26.75   per share if redeemed thereafter.

E-2-2

EXHIBIT 3

PACIFIC GAS AND ELECTRIC COMPANY
CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 4.80% REDEEMABLE FIRST PREFERRED STOCK

WHEREAS, the Articles of Incorporation of this corporation provide for a class of stock known as First Preferred Stock, issuable from time to time in one or more series, of which a series of such class of stock was issued as the 4.80% Redeemable First Preferred Stock, $25 par value (herein called the "4.80% Series"); and

WHEREAS, this corporation has elected to redeem, purchase, or otherwise acquire 724,344 shares of the 4.80% Series from time to time; and

WHEREAS, pursuant to California Corporations Code Section 202(e)(3), the 724,344 shares constituting the decrease in the 4.80% Series resumed the status of authorized and unissued shares of First Preferred Stock, $25 par value; and

WHEREAS, it is in the best interest of this corporation to restate the two existing Certificates of Determination of Preferences of the 4.80% Series to (i) reflect the reduction in the authorized number of shares of the 4.80% Series,
(ii) consolidate such existing Certificates of Determination of Preferences into a single Certificate of Determination of Preferences of the 4.80% Series, and
(iii) eliminate the portions of the officers' certificates and verifications which do not set forth any of the rights, preferences, privileges, or restrictions of the 4.80% Series.

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificates of Determination of Preferences of the 4.80% Series is hereby approved; and

BE IT FURTHER RESOLVED that the Certificate of Determination of Preferences of the 4.80% Series is hereby approved and adopted as restated in its entirety as follows:

793,031 shares of this corporation's unissued redeemable First Preferred Stock shall constitute a series designated "4.80% Redeemable First Preferred Stock"; the

E-3-1

dividend rate of such shares shall be 4.80% per year; such shares shall have no conversion rights; and the redemption price for such shares shall be

$28.75   per share if redeemed on or before January 31, 1955;
$28.25   per share if redeemed thereafter and on or before January 31, 1960;
$27.75   per share if redeemed thereafter and on or before January 31, 1965; and
$27.25   per share if redeemed thereafter.

E-3-2

EXHIBIT 4

PACIFIC GAS AND ELECTRIC COMPANY
CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 4.50% REDEEMABLE FIRST PREFERRED STOCK

WHEREAS, the Articles of Incorporation of this corporation provide for a class of stock known as First Preferred Stock, issuable from time to time in one or more series, of which a series of such class of stock was issued as the 4.50% Redeemable First Preferred Stock, $25 par value (herein called the "4.50% Series"); and

WHEREAS, this corporation has elected to redeem, purchase, or otherwise acquire 516,284 shares of the 4.50% Series from time to time; and

WHEREAS, pursuant to California Corporations Code Section 202(e)(3), the 516,284 shares constituting the decrease in the 4.50% Series resumed the status of authorized and unissued shares of First Preferred Stock, $25 par value; and

WHEREAS, it is in the best interest of this corporation to restate the two existing Certificates of Determination of Preferences of the 4.50% Series to (i) reflect the reduction in the authorized number of shares of the 4.50% Series,
(ii) consolidate such existing Certificates of Determination of Preferences into a single Certificate of Determination of Preferences of the 4.50% Series, and
(iii) eliminate the portions of the officers' certificates and verifications which do not set forth any of the rights, preferences, privileges, or restrictions of the 4.50% Series.

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificates of Determination of Preferences of the 4.50% Series is hereby approved; and

BE IT FURTHER RESOLVED that the Certificate of Determination of Preferences of the 4.50% Series is hereby approved and adopted as restated in its entirety as follows:

611,142 shares of this corporation's unissued redeemable first preferred stock shall constitute a series designated "4.50% Redeemable First Preferred Stock"; the dividend rate of such shares shall be 4.50% per year; such shares shall have no conversion rights; and the redemption price of such shares shall be

E-4-1

$27.25    per share if redeemed on or before July 31, 1959;
$26.75    per share if redeemed thereafter and on or before July 31, 1964;
$26.25    per share if redeemed thereafter and on or before July 31, 1969; and
$26.00    per share if redeemed thereafter.

E-4-2

EXHIBIT 5

PACIFIC GAS AND ELECTRIC COMPANY
CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 4.36% REDEEMABLE FIRST PREFERRED STOCK

WHEREAS, the Articles of Incorporation of this corporation provide for a class of stock known as First Preferred Stock, issuable from time to time in one or more series, of which a series of such class of stock was issued as the 4.36% Redeemable First Preferred Stock, $25 par value (herein called the "4.36% Series"); and

WHEREAS, this corporation has elected to redeem, purchase or otherwise acquire 581,709 shares of the 4.36% Series from time to time; and

WHEREAS, pursuant to California Corporations Code Section 202(e)(3), the 581,709 shares constituting the decrease in the 4.36% Series resumed the status of authorized and unissued shares of First Preferred Stock, $25 par value; and

WHEREAS, it is in the best interest of this corporation to restate the Certificate of Determination of Preferences of the 4.36% Series to (i) reflect the reduction in the authorized number of shares of the 4.36% Series and (ii) eliminate the portions of the officers' certificate and verification which do not set forth any of the rights, preferences, privileges, or restrictions of the 4.36% Series.

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificate of Determination of Preferences of the 4.36% Series is hereby approved; and

E-5-1

BE IT FURTHER RESOLVED that the Certificate of Determination of Preferences of the 4.36% Series is hereby approved and adopted as restated in its entirety as follows:

418,291 shares of this corporation's unissued Redeemable First Preferred Stock shall constitute a series designated "4.36% Redeemable First Preferred Stock"; the dividend rate of such shares shall be 4.36% per year; such shares shall have no conversion rights; and the redemption price of such shares shall be

$26.75    per share if redeemed on or before October 31, 1960;
$26.50    per share if redeemed thereafter and on or before October 31, 1965;
$26.25    per share if redeemed thereafter and on or before October 31, 1970;
$26.00    per share if redeemed thereafter and on or before October 31, 1975; and
$25.75    per share if redeemed thereafter.

E-5-2

EXHIBIT 6

CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 6.57% REDEEMABLE FIRST PREFERRED STOCK OF
PACIFIC GAS AND ELECTRIC COMPANY

WHEREAS, the Articles of Incorporation of this corporation provide for a class of stock known as First Preferred Stock, issuable from time to time in one or more series, of which a series of such class of stock was issued as the 6.57% Redeemable First Preferred Stock, $25 par value (herein called the "6.57% Series"); and

WHEREAS, it is in the best interest of this corporation to restate the Certificate of Determination of Preferences of the 6.57% Series to eliminate the portions of the officers' certificate and verification which do not set forth any of the rights, preferences, privileges, or restrictions of the 6.57% Series.

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificate of Determination of Preferences of the 6.57% Series is hereby approved; and

BE IT FURTHER RESOLVED that the Certificate of Determination of Preferences of the 6.57% Series is hereby approved and adopted as restated in its entirety as follows:

3,000,000 shares of this corporation's unissued First Preferred Stock, $25 par value, shall constitute a series designated "6.57% Redeemable First Preferred Stock" (hereinafter referred to as the "6.57% Series").

The terms of the 6.57% Series are hereby fixed as follows:

(a) The holders of shares of the 6.57% Series shall be entitled to receive, when and as declared by the Board of Directors, dividends at the rate of 6.57 percent of par value thereof per annum, and no more. Such dividends shall be cumulative with respect to each share from the date of issuance thereof.

(b) No dividend shall be declared or paid on any shares of the 6.57% Series or on any shares of any other series or class of preferred stock unless a ratable dividend on the 6.57% Series and such other series or class of preferred stock, in proportion to the full preferential amounts to which each series or class is entitled, is declared and is paid or set apart for payment. As used herein, the term "preferred stock" shall mean all series of the first preferred stock, $25 par value per share, and first preferred stock, $100 par value per share, and any other class of stock ranking equally with the preferred stock as to preference in dividends and liquidation rights,

E-6-1

notwithstanding that shares of such series and classes may differ as to the amounts of dividends or liquidation payments to which they are entitled.

(c) No junior shares or shares of preferred stock shall be purchased, redeemed or otherwise acquired by the corporation, and no moneys shall be paid to or set aside or made available for a sinking fund for the purchase or redemption of junior shares or shares of preferred stock, unless full cumulative dividends upon all series and classes of preferred stock then outstanding to the end of the dividend period next preceding the date fixed for such redemption (and for the current dividend period if the date fixed for such redemption is a dividend payment date) shall have been declared and shall have been paid or set aside for payment. As used herein, the term "junior shares" shall mean common shares or any other shares ranking junior to the preferred stock either as to dividends or upon liquidation, dissolution, or winding up.

(d) The shares of the 6.57% Series shall not be subject to redemption by this corporation prior to July 31, 2002. On or after July 31, 2002, the redemption price shall be $25.00 per share, together with an amount equal to all accumulated and unpaid dividends thereon to and including the date of redemption.

(e) Shares of the 6.57% Series shall also be subject to redemption through the operation of a sinking fund (herein called the "Sinking Fund") at the redemption price (the "Sinking Fund Redemption Price") of $25.00 per share plus an amount equal to the accumulated and unpaid dividends thereon to and including the redemption date, whether or not earned or declared. For the purposes of the Sinking Fund, out of any funds of the corporation legally available therefor remaining after full cumulative dividends upon all series and classes of preferred stock then outstanding to the end of the dividend period next preceding the date fixed for such redemption (and for the current dividend period if the date fixed for such redemption is a dividend payment date) shall have been declared and shall have been paid or set apart for payment, the corporation shall redeem 150,000 shares of the 6.57% Series annually on each July 31, from 2002 through 2006, inclusive, and 2,250,000 shares on July 31, 2007, at the Sinking Fund Redemption Price. The Sinking Fund shall be cumulative so that if on any such July 31 the funds of the corporation legally available therefor shall be insufficient to permit the required redemption in full, or if for any other reason such redemption shall not have been made in full, the remaining shares of the 6.57% Series so required to be redeemed shall be redeemed before any cash dividend shall be paid or declared, or any distribution made, on any junior shares or before any junior shares or any shares of preferred stock shall be purchased, redeemed or otherwise acquired by the corporation, or any monies shall be paid to or set aside or made available for a sinking fund for the purchase or redemption or any junior shares or any shares of preferred stock; provided, however, that, notwithstanding the existence of any such

E-6-2

deficiency, the corporation may make any required sinking fund redemption on any other series or class of preferred stock if the number of shares of such other series or class of preferred stock being so redeemed bears (as nearly as practicable) the same ratio to the aggregate number of shares of such other series or class then due to be redeemed as the number of shares of the 6.57% Series being redeemed bears to the aggregate number of shares of the 6.57% Series then due to be redeemed.

(f) Shares of the 6.57% Series redeemed otherwise than as required by section (e) or purchased or otherwise acquired by the corporation may, at the option of the corporation, be applied as a credit against any Sinking Fund redemption required by section (e). Moneys available for the Sinking Fund shall be applied on each such July 31 to the redemption of shares of the 6.57% Series.

(g) Any shares of the 6.57% Series which have been redeemed, purchased, or otherwise acquired by the corporation shall become authorized and unissued shares of the First Preferred Stock, $25 par value, but shall not be reissued as shares of the 6.57% Series.

(h) Upon liquidation, dissolution, or winding up of the corporation, the holders of shares of the 6.57% Series shall be entitled to receive the liquidation value per share, which is hereby fixed at $25.00 per share, plus an amount equal to all accumulated and unpaid dividends thereon at such time, whether or not earned or declared.

(i) Dividends shall be computed on a basis of a 360-day year of twelve 30-day months.

(j) If the date for payment of any dividend or the date fixed for redemption of any share of the 6.57% Series shall not be on a business day, then payment of the dividend or applicable redemption price need not be made on such date, but may be made on the next succeeding business day with the same force and effect as if made on the date for payment of such dividend or date fixed for redemption.

E-6-3

EXHIBIT 7

CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 7.04% REDEEMABLE FIRST PREFERRED STOCK OF
PACIFIC GAS AND ELECTRIC COMPANY

WHEREAS, the Articles of Incorporation of this corporation provide for a class of stock known as First Preferred Stock, issuable from time to time in one or more series, of which a series of such class of stock was issued as the 7.04% Redeemable First Preferred Stock, $25 par value (herein called the "7.04% Series"); and

WHEREAS, it is in the best interest of this corporation to restate the Certificate of Determination of Preferences of the 7.04% Series to eliminate the portions of the officers' certificate and verification which do not set forth any of the rights, preferences, privileges, or restrictions of the 7.04% Series.

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificate of Determination of Preferences of the 7.04% Series is hereby approved; and

BE IT FURTHER RESOLVED that the Certificate of Determination of Preferences of the 7.04% Series is hereby approved and adopted as restated in its entirety as follows:

3,000,000 shares of this corporation's unissued First Preferred Stock, $25 par value, shall constitute a series designated "7.04% Redeemable First Preferred Stock" (hereinafter referred to as the "7.04% Series").

The terms of the 7.04% Series are hereby fixed as follows:

(a) The holders of shares of the 7.04% Series shall be entitled to receive, when and as declared by the Board of Directors, dividends at the rate of 7.04 percent of par value thereof per annum, and no more. Such dividends shall be cumulative with respect to each share from the date of issuance thereof.

(b) No dividend shall be declared or paid on any shares of the 7.04% Series or on any shares of any other series or class of preferred stock unless a ratable dividend on the 7.04% Series and such other series or class of preferred stock, in proportion to the full preferential amounts to which each series or class is entitled, is declared and is paid or set apart for payment. As used herein, the term "preferred stock" shall mean all series of the first preferred stock, $25 par value per share, and first preferred stock, $100 par value per share, and any other class of stock ranking equally with the preferred stock as to preference in dividends and liquidation rights,

E-7-1

notwithstanding that shares of such series and classes may differ as to amounts of dividends or liquidation payments to which they are entitled.

(c) No junior shares or shares of preferred stock shall be purchased, redeemed, or otherwise acquired by the corporation, and no moneys shall be paid to or set aside or made available for a sinking fund for the purchase or redemption of junior shares or shares of preferred stock, unless full cumulative dividends upon all series and classes of preferred stock then outstanding to the end of the dividend period next preceding the date fixed for such redemption (and for the current dividend period if the date fixed for such redemption is a dividend payment date) shall have been declared and shall have been paid or set aside for payment. As used herein, the term "junior shares" shall mean common shares or any other shares ranking junior to the preferred stock either as to dividends or upon liquidation, dissolution, or winding up.

(d) The shares of the 7.04% Series shall not be subject to redemption by this corporation prior to January 31, 2003. On and after January 31, 2003, the redemption price shall be as follows:

If redeemed during the 12 months' period beginning January 31,

2003       $25.88          2008       $25.44
2004       $25.79          2009       $25.35
2005       $25.70          2010       $25.26
2006       $25.62          2011       $25.18
2007       $25.53          2012       $25.09

and at $25.00 per share on and after January 31, 2013, together in each case with an amount equal to all accumulated and unpaid dividends thereon to and including the date of redemption. For the purpose of redeeming any shares of the 7.04% Series, payment of the redemption price shall be out of any funds of the corporation legally available therefor remaining after: (i) full cumulative dividends upon all series and classes of preferred stock then outstanding to the end of the dividend period next preceding the date fixed for such redemption (and for the current dividend period if the date fixed for such redemption is a dividend payment date) shall have been declared and shall have been paid or set apart for payment, and (ii) all money shall have been paid to or set aside or made available for any sinking fund for the purchase or redemption of all series of and classes of preferred stock as may be required by the terms of such preferred stock.

(e) Any shares of the 7.04% Series which have been redeemed, purchased, or otherwise acquired by the corporation shall become authorized and unissued shares

E-7-2

of the First Preferred Stock, $25 par value, but shall not be reissued as shares of the 7.04% Series.

(f) Upon liquidation, dissolution, or winding up of the corporation, the holders of shares of the 7.04% Series shall be entitled to receive the liquidation value per share, which is hereby fixed at $25.00 per share, plus an amount equal to all accumulated and unpaid dividends thereon at such time, whether or not earned or declared.

(g) Dividends shall be computed on a basis of a 360-day year of twelve 30-day months.

(h) If the date for payment of any dividend or the date fixed for redemption of any share of the 7.04% Series shall not be a business day, then payment of the dividend or applicable redemption price need not be made on such date, but may be made on the next succeeding business day with the same force and effect as if made on the date for payment of such dividend or date fixed for redemption.

E-7-3

EXHIBIT 8

CERTIFICATE OF DETERMINATION OF PREFERENCES
OF 6.30% REDEEMABLE FIRST PREFERRED STOCK OF
PACIFIC GAS AND ELECTRIC COMPANY

WHEREAS, the Articles of Incorporation of this corporation provide for a class of stock known as First Preferred Stock, issuable from time to time in one or more series, of which a series of such class of stock was issued as the 6.30% Redeemable First Preferred Stock, $25 par value (herein called the "6.30% Series"); and

WHEREAS, it is in the best interest of this corporation to restate the Certificate of Determination of Preferences of the 6.30% Series to eliminate the portions of the officers' certificate and verification which do not set forth any of the rights, preferences, privileges, or restrictions of the 6.30% Series.

NOW, THEREFORE, BE IT RESOLVED that the foregoing restatement of the Certificate of Determination of Preferences of the 6.30% Series is hereby approved; and

BE IT FURTHER RESOLVED, that the Certificate of Determination of Preferences of the 6.30% Series is hereby approved and adopted as restated in its entirety as follows:

2,500,000 shares of this corporation's unissued Redeemable First Preferred Stock, $25 par value, shall constitute a series designated "6.30% Redeemable First Preferred Stock" (hereinafter referred to as the "6.30% Series").

The terms of the 6.30% Series are hereby fixed as follows:

(a) The holders of shares of the 6.30% Series shall be entitled to receive, when and as declared by the Board of Directors, dividends at the rate of 6.30 percent of par value thereof per annum, and no more. Such dividends shall be cumulative with respect to each share from the date of issuance thereof.

E-8-1

(b) No dividend shall be declared or paid on any shares of the 6.30% Series or on any shares of any other series or class of preferred stock unless a ratable dividend on the 6.30% Series and such other series or class of preferred stock, in proportion to the full preferential amounts to which each series or class is entitled, is declared and is paid or set apart for payment. As used herein, the term "preferred stock" shall mean all series of the first preferred stock, $25 par value per share, and first preferred stock, $100 par value per share, and any other class of stock ranking equally with the preferred stock as to preference in dividends and liquidation rights, notwithstanding that shares of such series and classes may differ as to amounts of dividends or liquidation payments to which they are entitled.

(d) The shares of the 6.30% Series shall not be subject to redemption by this corporation prior to January 31, 2004. On and after January 31, 2004, the redemption price shall be $25.00 per share, together with an amount equal to all accumulated and unpaid dividends thereon to and including the date of redemption. For the purpose of redeeming any shares of the 6.30% Series, payment of the redemption price shall be out of any funds of the corporation legally available therefor remaining after: (i) full cumulative dividends upon all series and classes of preferred stock then outstanding to the end of the dividend period next preceding the date fixed for such redemption (and for the current dividend period if the date fixed for such redemption is a dividend payment date) shall have been declared and shall have been paid or set apart for payment, and (ii) all money shall have been paid to or set aside or made available for any sinking fund for the purchase or redemption of all series of and classes of preferred stock as may be required by the terms of such preferred stock.

(e) Shares of the 6.30% Series shall also be subject to redemption through the operation of a sinking fund (herein called the "Sinking Fund") at the redemption price (the "Sinking Fund Redemption Price") of $25.00 per share plus an amount equal to the accumulated and unpaid dividends thereon to and including the redemption date, whether or not earned or declared. For the purposes of the Sinking Fund, out of any funds of the corporation legally available therefor remaining after full cumulative dividends upon all series and classes of preferred

E-8-2

stock then outstanding to the end of the dividend period next preceding the date fixed for such redemption (and for the current dividend period if the date fixed for such redemption is a dividend payment date) shall have been declared and shall have been paid or set apart for payment, the corporation shall redeem 125,000 shares of the 6.30% Series annually on each January 31, from 2004 through 2008, inclusive, and 1,875,000 shares on January 31, 2009, at the Sinking Fund Redemption Price. The Sinking Fund shall be cumulative so that if on any such January 31 the funds of the corporation legally available therefor shall be insufficient to permit the required redemption in full, or if for any other reason such redemption shall not have been made in full, the remaining shares of the 6.30% Series so required to be redeemed shall be redeemed before any cash dividend shall be paid or declared, or any distribution made, on any junior shares or before any junior shares or any shares of preferred stock shall be purchased, redeemed or otherwise acquired by the corporation, or any moneys shall be paid to or set aside or made available for a sinking fund for the purchase or redemption of any junior shares or any shares of preferred stock; provided, however, that, notwithstanding the existence of any such deficiency, the corporation may make any required sinking fund redemption on any other series or class of preferred stock if the number of shares of such other series or class of preferred stock being so redeemed bears (as nearly as practicable) the same ratio to the aggregate number of shares of such other series or class then due to be redeemed as the number of shares of the 6.30% Series being redeemed bears to the aggregate number of shares of the 6.30% Series then due to be redeemed.

(f) Shares of the 6.30% Series redeemed otherwise than as required by section (e) or purchased or otherwise acquired by the corporation may, at the option of the corporation, be applied as a credit against any Sinking Fund redemption required by section (e). Moneys available for the Sinking Fund shall be applied on each such January 31 to the redemption of shares of the 6.30% Series.

(g) Any shares of the 6.30% Series which have been redeemed, purchased, or otherwise acquired by the corporation shall become authorized and unissued shares of the First Preferred Stock, $25 par value, but shall not be reissued as shares of the 6.30% Series.

(h) Upon liquidation, dissolution, or winding up of the corporation, the holders of shares of the 6.30% Series shall be entitled to receive the liquidation value per share, which is hereby fixed at $25.00 per share, plus an amount equal to all accumulated and unpaid dividends thereon at such time, whether or not earned or declared.

(i) Dividends shall be computed on a basis of a 360-day year of twelve 30-day months.

(j) If the date for payment of any dividend or the date fixed for redemption of any share of the 6.30% Series shall not be a business day, then payment of the

E-8-3

dividend or applicable redemption price need not be made on such date, but may be made on the next succeeding business day with the same force and effect as if made on the date for payment of such dividend or date fixed for redemption.

E-8-4

EXHIBIT 4

SECOND SUPPLEMENTAL INDENTURE

DATED AS OF APRIL 12, 2004

SUPPLEMENT TO INDENTURE OF MORTGAGE
DATED AS OF MARCH 11, 2004

PACIFIC GAS AND ELECTRIC COMPANY
ISSUER (MORTGAGOR)

AND

BNY WESTERN TRUST COMPANY,
TRUSTEE (MORTGAGEE)

TABLE OF CONTENTS

                                                                           PAGE
                                                                           ----
ARTICLE I      DEFINITIONS...................................................2

ARTICLE II     ESTABLISHMENT OF THE BOND OF THE SIXTH SERIES.................4

      SECTION 201       Designation of the Bond of the Sixth Series..........4

      SECTION 202       Form of the Bond of the Sixth Series.................4

      SECTION 203       Principal Amount of the Bond of the Sixth
                        Series...............................................4

      SECTION 204       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Sixth
                        Series...............................................5

      SECTION 205       No Redemption; No Sinking Fund.......................5

      SECTION 206       Paying Agent and Bond Registrar......................5

      SECTION 207       No Exchanges; Limitations on Transfers...............5

      SECTION 208       Other Terms of the Bond of the Sixth Series..........5

ARTICLE III    ESTABLISHMENT OF THE BOND OF THE SEVENTH SERIES...............6

      SECTION 301       Designation of the Bond of the Seventh Series........6

      SECTION 302       Form of the Bond of the Seventh Series...............6

      SECTION 303       Principal Amount of the Bond of the Seventh
                        Series...............................................6

      SECTION 304       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Seventh
                        Series...............................................6

      SECTION 305       No Redemption; No Sinking Fund.......................6

      SECTION 306       Paying Agent and Bond Registrar......................7

      SECTION 307       No Exchanges; Limitations on Transfers...............7

      SECTION 308       Other Terms of the Bond of the Seventh Series........7

ARTICLE IV     ESTABLISHMENT OF THE BOND OF THE EIGHTH SERIES................7

      SECTION 401       Designation of the Bond of the Eighth Series.........7

      SECTION 402       Form of the Bond of the Eighth Series................7

      SECTION 403       Principal Amount of the Bond of the Eighth
                        Series...............................................7

      SECTION 404       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Eighth
                        Series...............................................8

      SECTION 405       No Redemption; No Sinking Fund.......................8

      SECTION 406       Paying Agent and Bond Registrar......................8

      SECTION 407       No Exchanges; Limitations on Transfers...............8

      SECTION 408       Other Terms of the Bond of the Eighth Series.........8

ARTICLE V      ESTABLISHMENT OF THE BOND OF THE NINTH SERIES.................9

TABLE OF CONTENTS

                                                                           PAGE
                                                                           ----
      SECTION 501       Designation of the Bond of the Ninth Series..........9

      SECTION 502       Form of the Bond of the Ninth Series.................9

      SECTION 503       Principal Amount of the Bond of the Ninth
                        Series...............................................9

      SECTION 504       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Ninth
                        Series...............................................9

      SECTION 505       No Redemption; No Sinking Fund.......................9

      SECTION 506       Paying Agent and Bond Registrar.....................10

      SECTION 507       No Exchanges; Limitations on Transfers..............10

      SECTION 508       Other Terms of the Bond of the Ninth Series.........10

ARTICLE VI     ESTABLISHMENT OF THE BOND OF THE TENTH SERIES................10

      SECTION 601       Designation of the Bond of the Tenth Series.........10

      SECTION 602       Form of the Bond of the Tenth Series................10

      SECTION 603       Principal Amount of the Bond of the Tenth
                        Series..............................................10

      SECTION 604       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Tenth
                        Series..............................................11

      SECTION 605       No Redemption; No Sinking Fund......................11

      SECTION 606       Paying Agent and Bond Registrar.....................11

      SECTION 607       No Exchanges; Limitations on Transfers..............11

      SECTION 608       Other Terms of the Bond of the Tenth Series.........11

ARTICLE VII    ESTABLISHMENT OF THE BOND OF THE ELEVENTH SERIES.............12

      SECTION 701       Designation of the Bond of the Eleventh
                        Series..............................................12

      SECTION 702       Form of the Bond of the Eleventh Series;
                        Replacement of Bond After Release Date..............12

      SECTION 703       Principal Amount of the Bond of the Eleventh
                        Series..............................................12

      SECTION 704       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Eleventh
                        Series..............................................12

      SECTION 705       No Redemption; No Sinking Fund......................13

      SECTION 706       Paying Agent and Bond Registrar.....................13

      SECTION 707       No Exchanges; Limitations on Transfers..............13

      SECTION 708       Other Terms of the Bond of the Eleventh
                        Series..............................................13

ARTICLE VIII   ESTABLISHMENT OF THE BOND OF THE TWELFTH SERIES..............13

      SECTION 801       Designation of the Bond of the Twelfth Series.......13

TABLE OF CONTENTS

                                                                           PAGE
                                                                           ----
      SECTION 802       Form of the Bond of the Twelfth Series..............13

      SECTION 803       Principal Amount of the Bond of the Twelfth
                        Series..............................................14

      SECTION 804       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Twelfth
                        Series..............................................14

      SECTION 805       No Redemption; No Sinking Fund......................14

      SECTION 806       Paying Agent and Bond Registrar.....................14

      SECTION 807       No Exchanges; Limitations on Transfers..............14

      SECTION 808       Other Terms of the Bond of the Twelfth Series.......15

ARTICLE IX     ESTABLISHMENT OF THE BOND OF THE THIRTEENTH SERIES...........15

      SECTION 901       Designation of the Bond of the Thirteenth
                        Series..............................................15

      SECTION 902       Form of the Bond of the Thirteenth Series...........15

      SECTION 903       Principal Amount of the Bond of the
                        Thirteenth Series...................................15

      SECTION 904       Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the
                        Thirteenth Series...................................15

      SECTION 905       No Redemption; No Sinking Fund......................16

      SECTION 906       Paying Agent and Bond Registrar.....................16

      SECTION 907       No Exchanges; Limitations on Transfers..............16

      SECTION 908       Other Terms of the Bond of the Thirteenth
                        Series..............................................16

ARTICLE X      ESTABLISHMENT OF THE BOND OF THE FOURTEENTH SERIES...........16

      SECTION 1001      Designation of the Bond of the Fourteenth
                        Series..............................................16

      SECTION 1002      Form of the Bond of the Fourteenth Series...........16

      SECTION 1003      Principal Amount of the Bond of the
                        Fourteenth Series...................................16

      SECTION 1004      Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the
                        Fourteenth Series...................................17

      SECTION 1005      No Redemption; No Sinking Fund......................17

      SECTION 1006      Paying Agent and Bond Registrar.....................17

      SECTION 1007      No Exchanges; Limitations on Transfers..............17

      SECTION 1008      Other Terms of the Bond of the Fourteenth
                        Series..............................................17

ARTICLE XI     ESTABLISHMENT OF THE BOND OF THE FIFTEENTH SERIES............18

      SECTION 1101      Designation of the Bond of the Fifteenth
                        Series..............................................18

      SECTION 1102      Form of the Bond of the Fifteenth Series............18

iii

TABLE OF CONTENTS

                                                                           PAGE
                                                                           ----
      SECTION 1103      Principal Amount of the Bond of the
                        Fifteenth Series....................................18

      SECTION 1104      Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Fifteenth
                        Series..............................................18

      SECTION 1105      No Redemption; No Sinking Fund......................18

      SECTION 1106      Paying Agent and Bond Registrar.....................19

      SECTION 1107      No Exchanges; Limitations on Transfers..............19

      SECTION 1108      Other Terms of the Bond of the Fifteenth
                        Series..............................................19

ARTICLE XII    ESTABLISHMENT OF THE BOND OF THE SIXTEENTH SERIES............19

      SECTION 1201      Designation of the Bond of the Sixteenth
                        Series..............................................19

      SECTION 1202      Form of the Bond of the Sixteenth Series............19

      SECTION 1203      Principal Amount of the Bond of the
                        Sixteenth Series....................................19

      SECTION 1204      Interest Rates; Interest Payment Dates;
                        Stated Maturity of the Bond of the Sixteenth
                        Series..............................................20

      SECTION 1205      No Redemption; No Sinking Fund......................20

      SECTION 1206      Paying Agent and Bond Registrar.....................20

      SECTION 1207      No Exchanges; Limitations on Transfers..............20

      SECTION 1208      Other Terms of the Bond of the Sixteenth
                        Series..............................................20

ARTICLE XIII   MISCELLANEOUS................................................21

      SECTION 1301      Additional Provisions...............................21

      SECTION 1302      Amendments to Indenture.............................21

      SECTION 1303      Application of Second Supplemental Indenture........21

      SECTION 1304      Effective Date of Second Supplemental
                        Indenture...........................................22

      SECTION 1305      Counterparts........................................22

EXHIBIT A

SECOND SUPPLEMENTAL INDENTURE, dated as of April 12, 2004 (this "Second Supplemental Indenture"), by and between PACIFIC GAS AND ELECTRIC COMPANY, a corporation duly organized and existing under the laws of the State of California (the "Company"), and BNY WESTERN TRUST COMPANY, a California banking corporation, as Trustee under the Indenture (as hereinafter defined) (the "Trustee").

RECITALS OF THE COMPANY

A .The Company and the Trustee are parties to that certain Indenture of Mortgage, dated as of March 11, 2004 (as recorded in the counties as described in Exhibit A hereto), as supplemented by the First Supplemental Indenture, dated as of March 23, 2004 (together with all additional indentures supplemental thereto, the "Indenture"), providing for the issuance by the Company of Bonds (as defined in the Indenture) from time to time.

B .Under the Indenture, the Company is authorized to issue unlimited series of Bonds and establish one or more series of Bonds at any time in accordance with and subject to the provisions of the Indenture, and the terms of such series of Bonds may be described by a supplemental indenture executed by the Company and the Trustee.

C .Pursuant to the Credit Agreement (as hereinafter defined) and Section 3.01 of the Indenture, the Company and the Trustee deem it advisable to enter into this Second Supplemental Indenture for the purposes of establishing the terms of the Bond of the Sixth Series (as hereinafter defined).

D .Pursuant to the 1996 Series C Reimbursement Agreement, the 1996 Series E Reimbursement Agreement, the 1996 Series F Reimbursement Agreement and the 1997 Series B Reimbursement Agreement (all as hereinafter defined) and Section 3.01 of the Indenture, the Company and the Trustee deem it advisable to enter into this Second Supplemental Indenture for the purposes of establishing the terms of the Bond of the Seventh Series, the Bond of the Eighth Series, the Bond of the Ninth Series and the Bond of the Tenth Series (all as hereinafter defined).

E .Pursuant to the MBIA Reimbursement and Indemnity Agreement (as hereinafter defined) and Section 3.01 of the Indenture, the Company and the Trustee deem it advisable to enter into this Second Supplemental Indenture for the purposes of establishing the terms of the Bond of the Eleventh Series.

F .Pursuant to the 1996 Series B Reimbursement Agreement, the 1996 Series D Reimbursement Agreement, the 1997 Series A Reimbursement Agreement and the 1997 Series C Reimbursement Agreement (all as hereinafter defined) and Section 3.01 of the Indenture, the Company and the Trustee deem it advisable to enter into this Second Supplemental Indenture for the purposes of establishing the terms of the Bond of the Twelfth Series, the Bond of the Thirteenth Series, the Bond of the Fourteenth Series and the Bond of the Fifteenth Series (all as hereinafter defined).

G .Pursuant to the $345 Million Credit Agreement (as hereinafter defined) and Section 3.01 of the Indenture, the Company and the Trustee deem it advisable to enter into this Second Supplemental Indenture for the purposes of establishing the terms of the Bond of the Sixteenth Series (as hereinafter defined).

H .The execution and delivery of this Second Supplemental Indenture has been authorized by a Board Resolution (as defined in the Indenture).

I .Concurrent with the execution hereof, the Company has caused its counsel to deliver to the Trustee an Opinion of Counsel (as defined in the Indenture) pursuant to Section 14.03 of the Indenture.

J .The Company has done all things necessary to make this Second Supplemental Indenture a valid agreement of the Company, in accordance with its terms.

NOW, THEREFORE, the Company and the Trustee agree, for the benefit of each other and the equal and proportionate benefit of all Holders of Bonds with respect to Section 1302 hereof and for the equal and proportionate benefit of Holders of the Bond of the Sixth Series, the Bond of the Seventh Series, the Bond of the Eighth Series, the Bond of the Ninth Series, the Bond of the Tenth Series, the Bond of the Eleventh Series, the Bond of the Twelfth Series, the Bond of the Thirteenth Series, the Bond of the Fourteenth Series, the Bond of the Fifteenth Series and the Bond of the Sixteenth Series with respect to all provisions herein, as follows:

ARTICLE I

DEFINITIONS

The following definitions are hereby established for purposes of this Second Supplemental Indenture (capitalized terms used but not defined herein have the meaning set forth in the Indenture) and shall have the meanings set forth in this Second Supplemental Indenture only for purposes of this Second Supplemental Indenture:

"Bond Form Officer's Certificate" means the Officer's Certificate, dated as of the date hereof, establishing the forms and certain terms of the Bond of the Sixth Series, the Bond of the Seventh Series, the Bond of the Eighth Series, the Bond of the Ninth Series, the Bond of the Tenth Series, the Bond of the Eleventh Series, the Bond of the Twelfth Series, the Bond of the Thirteenth Series, the Bond of the Fourteenth Series, the Bond of the Fifteenth Series and the Bond of the Sixteenth Series.

"Credit Agreement" means the $850,000,000 Credit Agreement, dated as of March 5, 2004, by and among the Company, the lenders party thereto, Citicorp North America, Inc., as Administrative Agent, Banc One Capital Markets, Inc., as Syndication Agent, and Lehman Commercial Paper Inc., Credit Suisse First Boston, acting through its Cayman Islands branch, and UBS Securities LLC, as Co-Documentation Agents, as amended, supplemented, restated or otherwise modified from time to time.

"MBIA" means MBIA Insurance Corporation.

"MBIA Reimbursement and Indemnity Agreement" means the Amended and Restated Reimbursement and Indemnity Agreement, dated as of March 5, 2004, between the Company and MBIA, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1996 Series B Reimbursement Agreement" means the Amended and Restated Reimbursement Agreement (1996 Series B), dated as of April 12, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Administrative Agent, and Citicorp North America, Inc., as Syndication Agent, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1996 Series C Reimbursement Agreement" means the 1996 Series C Reimbursement Agreement, dated as of March 5, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Issuing Lender, Citicorp North America, Inc., as Administrative Agent, Banc One Capital Markets, Inc., as Syndication Agent, and Lehman Commercial Paper Inc., Credit Suisse First Boston, acting through its Cayman Islands branch, and UBS Securities LLC, as Co-Documentation Agents, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1996 Series D Reimbursement Agreement" means the Amended and Restated Reimbursement Agreement (1996 Series D), dated as of April 12, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Administrative Agent, and Citicorp North America, Inc., as Syndication Agent, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1996 Series E Reimbursement Agreement" means the 1996 Series E Reimbursement Agreement, dated as of March 5, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Issuing Lender, Citicorp North America, Inc., as Administrative Agent, Banc One Capital Markets, Inc., as Syndication Agent, and Lehman Commercial Paper Inc., Credit Suisse First Boston, acting through its Cayman Islands branch, and UBS Securities LLC, as Co-Documentation Agents, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1996 Series F Reimbursement Agreement" means the 1996 Series F Reimbursement Agreement, dated as of March 5, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Issuing Lender, Citicorp North America, Inc., as Administrative Agent, Banc One Capital Markets, Inc., as Syndication Agent, and Lehman Commercial Paper Inc., Credit Suisse First Boston, acting through its Cayman Islands branch, and UBS Securities LLC, as Co-Documentation Agents, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1997 Series A Reimbursement Agreement" means the Amended and Restated Reimbursement Agreement (1997 Series A), dated as of April 12, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Administrative Agent, and Citicorp North America, Inc., as Syndication Agent, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1997 Series B Reimbursement Agreement" means the 1997 Series B Reimbursement Agreement, dated as of March 5, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Issuing Lender, Citicorp North America, Inc., as Administrative Agent, Banc One Capital Markets, Inc., as Syndication Agent, and Lehman Commercial Paper Inc., Credit Suisse First Boston, acting through its Cayman Islands branch, and UBS Securities LLC, as Co-

Documentation Agents, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"1997 Series C Reimbursement Agreement" means the Amended and Restated Reimbursement Agreement (1997 Series C), dated as of April 12, 2004, by and among the Company, the lenders party thereto, Bank One, NA, as Administrative Agent, and Citicorp North America, Inc., as Syndication Agent, as the same may be amended, supplemented, restated or otherwise modified from time to time.

"$345 Million Credit Agreement" means the $345,000,000 Credit Agreement, dated as of March 5, 2004, by and among the Company, the lenders party thereto, Citicorp North America, Inc., as Syndication Agent, and Bank One, NA, as Administrative Agent, as amended, supplemented, restated or otherwise modified from time to time.

The words "herein," "hereof" and "hereunder" and other words of similar import refer to this Second Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision.

ARTICLE II

ESTABLISHMENT OF THE BOND OF THE SIXTH SERIES

SECTION 201 Designation of the Bond of the Sixth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a sixth series of Bonds designated as the "Bond of the Sixth Series" (the "Bond of the Sixth Series").

SECTION 202 Form of the Bond of the Sixth Series.

The Bond of the Sixth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit A to the Bond Form Officer's Certificate.

SECTION 203 Principal Amount of the Bond of the Sixth Series.

The Bond of the Sixth Series shall be issued in an initial face amount of $850,000,000, which face amount shall represent the maximum principal amount of the Bond of the Sixth Series. The amount of principal payable on the Bond of the Sixth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Sixth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Sixth Series) outstanding under the Loan Documents (as defined in the Bond of the Sixth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Sixth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Sixth Series shall be payable without the presentment or surrender thereof.

SECTION 204 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Sixth Series.

The Bond of the Sixth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Sixth Series shall have a Stated Maturity of March 5, 2007; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Sixth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Sixth Series) until such interest is paid.

SECTION 205 No Redemption; No Sinking Fund.

The Bond of the Sixth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Sixth Series.

SECTION 206 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Sixth Series. The Place of Payment of the Bond of the Sixth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 207 No Exchanges; Limitations on Transfers.

The Bond of the Sixth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the Credit Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 208 Other Terms of the Bond of the Sixth Series.

The other terms of the Bond of the Sixth Series shall be as expressly set forth in Exhibit A to the Bond Form Officer's Certificate.

ARTICLE III

ESTABLISHMENT OF THE BOND OF THE SEVENTH SERIES

SECTION 301 Designation of the Bond of the Seventh Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a seventh series of Bonds designated as the "Bond of the Seventh Series" (the "Bond of the Seventh Series").

SECTION 302 Form of the Bond of the Seventh Series.

The Bond of the Seventh Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit B to the Bond Form Officer's Certificate.

SECTION 303 Principal Amount of the Bond of the Seventh Series.

The Bond of the Seventh Series shall be issued in an initial face amount of $202,191,781, which face amount shall represent the maximum principal amount of the Bond of the Seventh Series. The amount of principal payable on the Bond of the Seventh Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Seventh Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Seventh Series) outstanding under the Loan Documents (as defined in the Bond of the Seventh Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Seventh Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Seventh Series shall be payable without the presentment or surrender thereof.

SECTION 304 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Seventh Series.

The Bond of the Seventh Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Seventh Series shall have a Stated Maturity of March 5, 2007; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Seventh Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Seventh Series) until such interest is paid.

SECTION 305 No Redemption; No Sinking Fund.

The Bond of the Seventh Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Seventh Series.

SECTION 306 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Seventh Series. The Place of Payment of the Bond of the Seventh Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 307 No Exchanges; Limitations on Transfers.

The Bond of the Seventh Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1996 Series C Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 308 Other Terms of the Bond of the Seventh Series.

The other terms of the Bond of the Seventh Series shall be as expressly set forth in Exhibit B to the Bond Form Officer's Certificate.

ARTICLE IV

ESTABLISHMENT OF THE BOND OF THE EIGHTH SERIES

SECTION 401 Designation of the Bond of the Eighth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes an eighth series of Bonds designated as the "Bond of the Eighth Series" (the "Bond of the Eighth Series").

SECTION 402 Form of the Bond of the Eighth Series.

The Bond of the Eighth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit C to the Bond Form Officer's Certificate.

SECTION 403 Principal Amount of the Bond of the Eighth Series.

The Bond of the Eighth Series shall be issued in an initial face amount of $166,808,220, which face amount shall represent the maximum principal amount of the Bond of the Eighth Series. The amount of principal payable on the Bond of the Eighth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Eighth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Eighth Series) outstanding under the Loan Documents (as defined in the Bond of the Eighth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be

greater than the then current face amount of such Bond. The initial face amount of the Bond of the Eighth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Eighth Series shall be payable without the presentment or surrender thereof.

SECTION 404 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Eighth Series.

The Bond of the Eighth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Eighth Series shall have a Stated Maturity of March 5, 2007; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Eighth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Eighth Series) until such interest is paid.

SECTION 405 No Redemption; No Sinking Fund.

The Bond of the Eighth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Eighth Series.

SECTION 406 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Eighth Series. The Place of Payment of the Bond of the Eighth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 407 No Exchanges; Limitations on Transfers.

The Bond of the Eighth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1996 Series E Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 408 Other Terms of the Bond of the Eighth Series.

The other terms of the Bond of the Eighth Series shall be as expressly set forth in Exhibit C to the Bond Form Officer's Certificate.

ARTICLE V

ESTABLISHMENT OF THE BOND OF THE NINTH SERIES

SECTION 501 Designation of the Bond of the Ninth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a ninth series of Bonds designated as the "Bond of the Ninth Series" (the "Bond of the Ninth Series").

SECTION 502 Form of the Bond of the Ninth Series.

The Bond of the Ninth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit D to the Bond Form Officer's Certificate.

SECTION 503 Principal Amount of the Bond of the Ninth Series.

The Bond of the Ninth Series shall be issued in an initial face amount of $101,095,891, which face amount shall represent the maximum principal amount of the Bond of the Ninth Series. The amount of principal payable on the Bond of the Ninth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Ninth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Ninth Series) outstanding under the Loan Documents (as defined in the Bond of the Ninth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Ninth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Ninth Series shall be payable without the presentment or surrender thereof.

SECTION 504 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Ninth Series.

The Bond of the Ninth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Ninth Series shall have a Stated Maturity of March 5, 2007; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Ninth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Ninth Series) until such interest is paid.

SECTION 505 No Redemption; No Sinking Fund.

The Bond of the Ninth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Ninth Series.

SECTION 506 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Ninth Series. The Place of Payment of the Bond of the Ninth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 507 No Exchanges; Limitations on Transfers.

The Bond of the Ninth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1996 Series F Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 508 Other Terms of the Bond of the Ninth Series.

The other terms of the Bond of the Ninth Series shall be as expressly set forth in Exhibit D to the Bond Form Officer's Certificate.

ARTICLE VI

ESTABLISHMENT OF THE BOND OF THE TENTH SERIES

SECTION 601 Designation of the Bond of the Tenth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a tenth series of Bonds designated as the "Bond of the Tenth Series" (the "Bond of the Tenth Series").

SECTION 602 Form of the Bond of the Tenth Series.

The Bond of the Tenth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit E to the Bond Form Officer's Certificate.

SECTION 603 Principal Amount of the Bond of the Tenth Series.

The Bond of the Tenth Series shall be issued in an initial face amount of $150,177,946, which face amount shall represent the maximum principal amount of the Bond of the Tenth Series. The amount of principal payable on the Bond of the Tenth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Tenth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Tenth Series) outstanding under the Loan Documents (as defined in the Bond of the Tenth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be

greater than the then current face amount of such Bond. The initial face amount of the Bond of the Tenth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Tenth Series shall be payable without the presentment or surrender thereof.

SECTION 604 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Tenth Series.

The Bond of the Tenth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Tenth Series shall have a Stated Maturity of March 5, 2007; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Tenth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Tenth Series) until such interest is paid.

SECTION 605 No Redemption; No Sinking Fund.

The Bond of the Tenth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Tenth Series.

SECTION 606 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Tenth Series. The Place of Payment of the Bond of the Tenth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 607 No Exchanges; Limitations on Transfers.

The Bond of the Tenth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1997 Series B Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 608 Other Terms of the Bond of the Tenth Series.

The other terms of the Bond of the Tenth Series shall be as expressly set forth in Exhibit E to the Bond Form Officer's Certificate.

ARTICLE VII

ESTABLISHMENT OF THE BOND OF THE ELEVENTH SERIES

SECTION 701 Designation of the Bond of the Eleventh Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes an eleventh series of Bonds designated as the "Bond of the Eleventh Series" (the "Bond of the Eleventh Series").

SECTION 702 Form of the Bond of the Eleventh Series; Replacement of Bond After Release Date.

The Bond of the Eleventh Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit F to the Bond Form Officer's Certificate. As soon as reasonably practicable after the Release Date, the Holder of the Bond of the Eleventh Series shall surrender such Bond to the Trustee and the Trustee shall simultaneously exchange the surrendered Bond for a new Bond of the Eleventh Series identical in all respects to the surrendered Bond except that the name of such Bond shall be changed from "Bond" to "Senior Note," all references in such Bond to "Bonds" or "Bond" shall be changed to "Notes" or "Note," respectively, and the bracketed language in the form of the Bond of the Eleventh Series attached as Exhibit F to the Bond Form Officer's Certificate shall be deleted (the "Replacement Bond of the Eleventh Series"). If the Company designates the Release Date pursuant to Section 8.12 of the Indenture, then in addition to the items the Company is required to deliver to the Trustee pursuant to Section 8.12 of the Indenture, the Company shall deliver to the Trustee on or before the Release Date the Replacement Bond of the Eleventh Series duly executed by the Company for authentication by the Trustee, and the Trustee shall cancel the replaced Bond of the Eleventh Series and, upon a Company Request, deliver to the Company a certificate of cancellation with respect to such replaced Bond of the Eleventh Series.

SECTION 703 Principal Amount of the Bond of the Eleventh Series.

The Bond of the Eleventh Series shall be issued in an initial face amount of $200,000,000, which face amount shall represent the maximum principal amount of the Bond of the Eleventh Series. The amount of principal payable on the Bond of the Eleventh Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Eleventh Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Eleventh Series) outstanding under the MBIA Reimbursement and Indemnity Agreement as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. Principal of the Bond of the Eleventh Series shall be payable without the presentment or surrender thereof.

SECTION 704 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Eleventh Series.

The Bond of the Eleventh Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond

of the Eleventh Series shall have a Stated Maturity of December 1, 2016. Interest on the Bond of the Eleventh Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the MBIA Reimbursement and Indemnity Agreement until such interest is paid.

SECTION 705 No Redemption; No Sinking Fund.

The Bond of the Eleventh Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Eleventh Series.

SECTION 706 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Eleventh Series. The Place of Payment of the Bond of the Eleventh Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 707 No Exchanges; Limitations on Transfers.

The Bond of the Eleventh Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of MBIA. The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 708 Other Terms of the Bond of the Eleventh Series.

The other terms of the Bond of the Eleventh Series shall be as expressly set forth in Exhibit F to the Bond Form Officer's Certificate.

ARTICLE VIII

ESTABLISHMENT OF THE BOND OF THE TWELFTH SERIES

SECTION 801 Designation of the Bond of the Twelfth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a twelfth series of Bonds designated as the "Bond of the Twelfth Series" (the "Bond of the Twelfth Series").

SECTION 802 Form of the Bond of the Twelfth Series.

The Bond of the Twelfth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit G to the Bond Form Officer's Certificate.

SECTION 803 Principal Amount of the Bond of the Twelfth Series.

The Bond of the Twelfth Series shall be issued in an initial face amount of $160,000,000, which face amount shall represent the maximum principal amount of the Bond of the Twelfth Series. The amount of principal payable on the Bond of the Twelfth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Twelfth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Twelfth Series) outstanding under the Loan Documents (as defined in the Bond of the Twelfth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Twelfth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Twelfth Series shall be payable without the presentment or surrender thereof.

SECTION 804 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Twelfth Series.

The Bond of the Twelfth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Twelfth Series shall have a Stated Maturity of June 5, 2005; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Twelfth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Twelfth Series) until such interest is paid.

SECTION 805 No Redemption; No Sinking Fund.

The Bond of the Twelfth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Twelfth Series.

SECTION 806 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Twelfth Series. The Place of Payment of the Bond of the Twelfth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 807 No Exchanges; Limitations on Transfers.

The Bond of the Twelfth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1996 Series B Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 808 Other Terms of the Bond of the Twelfth Series.

The other terms of the Bond of the Twelfth Series shall be as expressly set forth in Exhibit G to the Bond Form Officer's Certificate.

ARTICLE IX

ESTABLISHMENT OF THE BOND OF THE THIRTEENTH SERIES

SECTION 901 Designation of the Bond of the Thirteenth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a thirteenth series of Bonds designated as the "Bond of the Thirteenth Series" (the "Bond of the Thirteenth Series").

SECTION 902 Form of the Bond of the Thirteenth Series.

The Bond of the Thirteenth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit H to the Bond Form Officer's Certificate.

SECTION 903 Principal Amount of the Bond of the Thirteenth Series.

The Bond of the Thirteenth Series shall be issued in an initial face amount of $100,000,000, which face amount shall represent the maximum principal amount of the Bond of the Thirteenth Series. The amount of principal payable on the Bond of the Thirteenth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Thirteenth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Thirteenth Series) outstanding under the Loan Documents (as defined in the Bond of the Thirteenth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Thirteenth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Thirteenth Series shall be payable without the presentment or surrender thereof.

SECTION 904 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Thirteenth Series.

The Bond of the Thirteenth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Thirteenth Series shall have a Stated Maturity of June 5, 2005; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Thirteenth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Thirteenth Series) until such interest is paid.

SECTION 905 No Redemption; No Sinking Fund.

The Bond of the Thirteenth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Thirteenth Series.

SECTION 906 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Thirteenth Series. The Place of Payment of the Bond of the Thirteenth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 907 No Exchanges; Limitations on Transfers.

The Bond of the Thirteenth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1996 Series D Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 908 Other Terms of the Bond of the Thirteenth Series.

The other terms of the Bond of the Thirteenth Series shall be as expressly set forth in Exhibit H to the Bond Form Officer's Certificate.

ARTICLE X

ESTABLISHMENT OF THE BOND OF THE FOURTEENTH SERIES

SECTION 1001 Designation of the Bond of the Fourteenth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a fourteenth series of Bonds designated as the "Bond of the Fourteenth Series" (the "Bond of the Fourteenth Series").

SECTION 1002 Form of the Bond of the Fourteenth Series.

The Bond of the Fourteenth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit I to the Bond Form Officer's Certificate.

SECTION 1003 Principal Amount of the Bond of the Fourteenth Series.

The Bond of the Fourteenth Series shall be issued in an initial face amount of $45,000,000, which face amount shall represent the maximum principal amount of the Bond of the Fourteenth Series. The amount of principal payable on the Bond of the Fourteenth Series,

and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Fourteenth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Fourteenth Series) outstanding under the Loan Documents (as defined in the Bond of the Fourteenth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Fourteenth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Fourteenth Series shall be payable without the presentment or surrender thereof.

SECTION 1004 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Fourteenth Series.

The Bond of the Fourteenth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Fourteenth Series shall have a Stated Maturity of June 5, 2005; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Fourteenth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Fourteenth Series) until such interest is paid.

SECTION 1005 No Redemption; No Sinking Fund.

The Bond of the Fourteenth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Fourteenth Series.

SECTION 1006 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Fourteenth Series. The Place of Payment of the Bond of the Fourteenth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 1007 No Exchanges; Limitations on Transfers.

The Bond of the Fourteenth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1997 Series A Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 1008 Other Terms of the Bond of the Fourteenth Series.

The other terms of the Bond of the Fourteenth Series shall be as expressly set forth in Exhibit I to the Bond Form Officer's Certificate.

ARTICLE XI

ESTABLISHMENT OF THE BOND OF THE FIFTEENTH SERIES

SECTION 1101 Designation of the Bond of the Fifteenth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a fifteenth series of Bonds designated as the "Bond of the Fifteenth Series" (the "Bond of the Fifteenth Series").

SECTION 1102 Form of the Bond of the Fifteenth Series.

The Bond of the Fifteenth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit J to the Bond Form Officer's Certificate.

SECTION 1103 Principal Amount of the Bond of the Fifteenth Series.

The Bond of the Fifteenth Series shall be issued in an initial face amount of $148,550,000, which face amount shall represent the maximum principal amount of the Bond of the Fifteenth Series. The amount of principal payable on the Bond of the Fifteenth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Fifteenth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Fifteenth Series) outstanding under the Loan Documents (as defined in the Bond of the Fifteenth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Fifteenth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Fifteenth Series shall be payable without the presentment or surrender thereof.

SECTION 1104 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Fifteenth Series.

The Bond of the Fifteenth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Fifteenth Series shall have a Stated Maturity of June 5, 2005; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Fifteenth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Fifteenth Series) until such interest is paid.

SECTION 1105 No Redemption; No Sinking Fund.

The Bond of the Fifteenth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Fifteenth Series.

SECTION 1106 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Fifteenth Series. The Place of Payment of the Bond of the Fifteenth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 1107 No Exchanges; Limitations on Transfers.

The Bond of the Fifteenth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the 1997 Series C Reimbursement Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 1108 Other Terms of the Bond of the Fifteenth Series.

The other terms of the Bond of the Fifteenth Series shall be as expressly set forth in Exhibit J to the Bond Form Officer's Certificate.

ARTICLE XII

ESTABLISHMENT OF THE BOND OF THE SIXTEENTH SERIES

SECTION 1201 Designation of the Bond of the Sixteenth Series.

Pursuant to the terms hereof and Section 3.01 of the Indenture, the Company hereby establishes a sixteenth series of Bonds designated as the "Bond of the Sixteenth Series" (the "Bond of the Sixteenth Series").

SECTION 1202 Form of the Bond of the Sixteenth Series.

The Bond of the Sixteenth Series shall be issued in certificated form and shall be substantially in the form attached as Exhibit K to the Bond Form Officer's Certificate.

SECTION 1203 Principal Amount of the Bond of the Sixteenth Series.

The Bond of the Sixteenth Series shall be issued in an initial face amount of $345,000,000, which face amount shall represent the maximum principal amount of the Bond of the Sixteenth Series. The amount of principal payable on the Bond of the Sixteenth Series, and the date or dates on which such principal is payable, shall be as set forth in said Bond. For all purposes of the Indenture, the principal amount of the Bond of the Sixteenth Series Outstanding as of any date of calculation shall be equal to the Obligations (as defined in the Bond of the Sixteenth Series) outstanding under the Loan Documents (as defined in the Bond of the Sixteenth Series) as of such date, but in no event shall the principal amount of such Bond as of any date of

calculation be greater than the then current face amount of such Bond. The initial face amount of the Bond of the Sixteenth Series may be reduced from time to time as set forth in said Bond. Principal of the Bond of the Sixteenth Series shall be payable without the presentment or surrender thereof.

SECTION 1204 Interest Rates; Interest Payment Dates; Stated Maturity of the Bond of the Sixteenth Series.

The Bond of the Sixteenth Series shall bear interest at the rate or rates and interest with respect thereto will be payable on the Interest Payment Dates set forth in said Bond. The Bond of the Sixteenth Series shall have a Stated Maturity of June 5, 2005; provided that the Stated Maturity may be extended from time to time as set forth in said Bond. Interest on the Bond of the Sixteenth Series shall accrue from the same dates that interest, if any, accrues on outstanding Obligations pursuant to the Loan Documents (as defined in the Bond of the Sixteenth Series) until such interest is paid.

SECTION 1205 No Redemption; No Sinking Fund.

The Bond of the Sixteenth Series shall not be subject to redemption prior to its Stated Maturity. No sinking fund is provided for the Bond of the Sixteenth Series.

SECTION 1206 Paying Agent and Bond Registrar.

The Trustee is hereby appointed as initial Paying Agent and initial Bond Registrar for the Bond of the Sixteenth Series. The Place of Payment of the Bond of the Sixteenth Series shall be the Corporate Trust Office of the Trustee; provided, however, that the Company reserves the right to change, by one or more Officer's Certificates any such place or the Bond Registrar; provided, further, that the Company reserves the right to designate, by one or more Officer's Certificates, one or more of its offices as any such place or itself as the Bond Registrar.

SECTION 1207 No Exchanges; Limitations on Transfers.

The Bond of the Sixteenth Series may not be exchanged for any other Bond, except as provided in Section 3.06 of the Indenture, and may not be transferred except to effect an assignment thereof to a successor or an assign of the Administrative Agent (as defined in the $345 Million Credit Agreement). The Company may take such actions as it shall deem necessary, desirable or appropriate to effect compliance with such restrictions on transfer, including the issuance of stop-transfer instructions to the Trustee or any other transfer agent.

SECTION 1208 Other Terms of the Bond of the Sixteenth Series.

The other terms of the Bond of the Sixteenth Series shall be as expressly set forth in Exhibit K to the Bond Form Officer's Certificate.

ARTICLE XIII

MISCELLANEOUS

SECTION 1301 Additional Provisions.

With respect to Bonds issued on or before the Effective Date, (1) the term "Senior Lien Obligations" shall not include obligations under the 1920 Mortgage, notwithstanding Section 1.01 of the Indenture, and (2) for purposes of calculating the Annual Interest Requirements under Section 5.01 of the Indenture, obligations under the 1920 Mortgage shall not be included.

SECTION 1302 Amendments to Indenture.

Clause (C) of the definition of "Annual Interest Requirements" in Section 5.01 of the Indenture is hereby amended to read as follows:

(C) the principal amount of all other indebtedness secured by a Senior Lien upon the Mortgaged Property or any part thereof (except (i) indebtedness of the Company the repayment of which supports or is supported by other indebtedness included in Annual Interest Requirements pursuant to one of the other clauses of this definition, (ii) indebtedness outstanding on the date of such certificate secured by a Prepaid Lien upon Mortgaged Property outstanding on the date of such certificate and secured by a lien on a parity with or prior to the lien of this Indenture upon Mortgaged Property, and (iii) indebtedness that will be redeemed or repaid through Bonds described in clause (B) of this definition), if such indebtedness has been issued, assumed or guaranteed by the Company or if the Company customarily pays the interest upon the principal thereof; provided, however, that if any such indebtedness bears interest at a variable rate or rates, then the interest requirement on such indebtedness shall be determined by reference to the rate or rates in effect two (2) Business Days immediately preceding the date of such certificate.

SECTION 1303 Application of Second Supplemental Indenture.

Except as provided herein, each and every term and condition contained in this Second Supplemental Indenture that modifies, amends or supplements the terms and conditions of the Indenture shall apply only to the Bond of the Sixth Series, the Bond of the Seventh Series, the Bond of the Eighth Series, the Bond of the Ninth Series, the Bond of the Tenth Series, the Bond of the Eleventh Series, the Bond of the Twelfth Series, the Bond of the Thirteenth Series, the Bond of the Fourteenth Series, the Bond of the Fifteenth Series and the Bond of the Sixteenth Series, established hereby and not to any other series of Bonds established under the Indenture. Except as specifically amended and supplemented by, or to the extent inconsistent with, this Second Supplemental Indenture, the Indenture shall remain in full force and effect and is hereby ratified and confirmed.

SECTION 1304 Effective Date of Second Supplemental Indenture.

This Second Supplemental Indenture shall be effective upon the execution and delivery hereof by each of the parties hereto.

SECTION 1305 Counterparts.

This Second Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be duly executed by their respective officers hereunto duly authorized, all as of the day and year first above written.

PACIFIC GAS AND ELECTRIC COMPANY,
as Issuer (Mortgagor)

By: /s/ Kent M. Harvey
   ---------------------------------
   Kent M. Harvey
   Senior Vice President, Chief
   Financial Officer and Treasurer

BNY WESTERN TRUST COMPANY,
as Trustee (Mortgagee)

By: /s/ Josephine Libunao
   ---------------------------------
   Josephine Libunao
   Vice President

[SIGNATURE PAGE TO SECOND SUPPLEMENTAL INDENTURE]

EXHIBIT A

Recording Information for Indenture of Mortgage, dated as of March 11, 2004

COUNTY                      RECORDING DATE/TIME                        INSTRUMENT NO.
------                      -------------------                        --------------
Alameda                 March 16, 2004 @ 8:30 A.M.           As Instrument No.:    2004-109262
Alpine                  March 15, 2004 @ 1:52 P.M.           As Instrument No.:    396-397
Amador                  March 15, 2004 @ 1:53 P.M.           As Instrument No.:    2004-3367
Butte                   March 16, 2004 @ 1:11 P.M.           As Instrument No.:    2004-0014587
Calaveras               March 15, 2004 @ 3:05 P.M.           As Instrument No.:    2004-5073
Colusa                  March 15, 2004 @ 2:47 P.M.           As Instrument No.:    2004-0001251
Contra Costa            March 16, 2004 @ 11:12 A.M.          As Instrument No.:    2004-088068
El Dorado               March 15, 2004 @ 11:15 A.M.          As Instrument No.:    2004-0018966
Fresno                  March 15, 2004 @ 11:19 A.M.          As Instrument No.:    20040055706
Glenn                   March 15, 2004 @ 2:58 P.M.           As Instrument No.:    2004-1539
Humboldt                March 15, 2004 @ 14:14 P.M.          As Instrument No.:    2004-8549-140
Kern                    March 15, 2004 @ 12:15 P.M.          As Instrument No.:    204056332
Kings                   March 15, 2004 @ 10:45 A.M.          As Instrument No.:    2004-07216
Lake                    March 16, 2004 @ 12:05 P.M.          As Instrument No.:    2004006521
Lassen                  March 16, 2004 @ 1:33 P.M.           As Instrument No.:    2004-02182
Madera                  March 16, 2004 @ 11:40 A.M.          As Instrument No.:    2004010893
Marin                   March 15, 2004 @ 11:18 P.M.          As Instrument No.:    2004-0019996
Mariposa                March 15, 2004 @ 2:52 P.M.           As Instrument No.:    204-1363
Mendocino               March 15, 2004 @ 12:21 P.M.          As Instrument No.:    2004-05491
Merced                  March 15, 2004 @ 12:53 P.M.          As Instrument No.:    2004-015197
Modoc                   March 16, 2004 @ 9:10 A.M.           As Instrument No.:    2004-0001638
Monterey                March 15, 2004 @ 2:37 P.M.           As Instrument No.:    2004023629
Napa                    March 16, 2004 @ 10:54 A.M.          As Instrument No.:    2004-9836
Nevada                  March 15, 2004 @ 11:33 A.M.          As Instrument No.:    20040009213
Placer                  March 15, 2004 @ 12:00 P.M.          As Instrument No.:    20040029193
Plumas                  March 15, 2004 @ 12:48 P.M.          As Instrument No.:    2004-0002405
Sacramento              March 15, 2004 @ 8:34 A.M.           As Instrument No.:    040315-391
San Benito              March 15, 2004 @ 3:12 P.M.           As Instrument No.:    2004-0004220
San Bernardino          March 15, 2004 @ 1:00 P.M.           As Instrument No.:    2004-177760
San Francisco           March 16, 2004 @ 11:13 A.M.          As Instrument No.:    2004H677107
San Joaquin             March 15, 2004 @ 2:45 P.M.           As Instrument No.:    2004-052211
San Luis Obispo         March 15, 2004 @ 10:58 A.M.          As Instrument No.:    2004020222
San Mateo               March 15, 2004 @ 2:03 P.M.           As Instrument No.:    2004-046828
Santa Barbara           March 16, 2004 @ 8:01 A.M.           As Instrument No.:    2004-0024575
Santa Clara             March 16, 2004 @ 3:40 P.M.           As Instrument No.:    17664290
Santa Cruz              March 16, 2004 @ 12:26 P.M.          As Instrument No.:    2004-0016635
Shasta                  March 15, 2004 @ 12:27 A.M.          As Instrument No.:    2004-0014021
Sierra                  March 15, 2004 @ 11:39 A.M.          As Instrument No.:    2004140119
Siskiyou                March 16, 2004 @ 2:59 P.M.           As Instrument No.:    04-0003770
Solano                  March 15, 2004 @ 2:55 P.M.           As Instrument No.:    200400030237
Sonoma                  March 15, 2004 @ 12:57 P.M.          As Instrument No.:    04-35085
Stanislaus              March 15, 2004 @ 9:56 A.M.           As Instrument No.:    2004-36718
Sutter                  March 16, 2004 @ 9:00 A.M.           As Instrument No.:    2004-6461
Tehama                  March 15, 2004 @ 9:39 A.M.           As Instrument No.:    _004969
Trinity                 March 15, 2004 @2:13 P.M.            As Instrument No.:    200401012
Tulare                  March 16, 2004 @ 11:39 A.M.          As Instrument No.:    2004-0023843
Tuolumne                March 15, 2004 @ 4:07 P.M.           As Instrument No.:    2004005028
Yolo                    March 15, 2004 @ 2:03 P.M.           As Instrument No.:    2004-0010011
Yuba                    March 16, 2004 @ 8:32 A.M.           As Instrument No.:    2004-004458

Table of Contents

Table of Contents

Table of Contents

Table of Contents


	PG&E CORPORATION /s/ Christopher P. Johns Christopher P. Johns Senior Vice President and Controller




	PACIFIC GAS AND ELECTRIC COMPANY /s/ Dinyar B. Mistry Dinyar B. Mistry Vice President and Controller