CONFORMED COPY
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                      Twenty-Eighth Supplemental Indenture
 
                          DATED AS OF DECEMBER 1, 1993
 
             (SUPPLEMENTAL TO INDENTURE DATED AS OF MARCH 15, 1946)
 
                               ------------------
 
                       PENNSYLVANIA GAS AND WATER COMPANY
             (FORMERLY SCRANTON-SPRING BROOK WATER SERVICE COMPANY)
 
                                       TO
 
                         MORGAN GUARANTY TRUST COMPANY
                                  OF NEW YORK,
                                                TRUSTEE
 
                               ------------------
 
                   FIRST MORTGAGE BONDS 6.05% SERIES DUE 2019
 
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                                       1
 
     TWENTY-EIGHTH SUPPLEMENTAL INDENTURE, dated as of the first day of December
1993, made by and between PENNSYLVANIA GAS AND WATER COMPANY (formerly
Scranton-Spring Brook Water Service Company), a corporation organized and
existing under the laws of the Commonwealth of Pennsylvania (hereinafter
sometimes called the 'Company'), and MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
a corporation organized and existing under the laws of the State of New York,
and having its principal place of business at No. 60 Wall Street, in The City of
New York, New York, as Trustee (hereinafter sometimes called the 'Trustee').
 
     WHEREAS, the Company executed and delivered its Indenture (hereinafter
called the 'Original Indenture') dated as of March 15, 1946, to Guaranty Trust
Company of New York, now Morgan Guaranty Trust Company of New York, to secure
its First Mortgage Bonds and has executed and delivered twenty-seven indentures
supplemental thereto dated respectively as of February 15, 1951; as of September
15, 1951; as of January 15, 1952; as of March 15, 1952; as of June 15, 1952; as
of December 1, 1954; as of April 15, 1956; as of November 15, 1956; as of March
15, 1957; as of September 1, 1958; as of April 15, 1959; as of July 15, 1960; as
of October 31, 1961; as of December 15, 1961; as of December 15, 1963; as of
June 15, 1966; as of October 15, 1967; as of May 1, 1970; as of June 1, 1972; as
of March 1, 1976; as of December 1, 1976; as of August 15, 1989; as of August
15, 1989; as of September 1, 1991; as of September 1, 1992; as of December 1,
1992; and as of December 1, 1992 (the Original Indenture as heretofore
supplemented and to be supplemented by this Twenty-Eighth Supplemental

Indenture, and as the same may be further supplemented by additional indentures
supplemental thereto, being hereinafter collectively called the 'Indenture');
and
 
     WHEREAS, the Company at November 30, 1993 (i) had retired all of the
original issue of $24,500,000 principal amount of bonds of a series designated
First Mortgage Bonds 2 7/8% Series due 1976 (hereinafter called 'bonds of the
First Series'), all of the original issue of $4,000,000 principal amount of
bonds of a series designated First Mortgage Bonds 3 1/2% Series due 1982, all of
the original issue of $1,000,000 principal amount of bonds of a series
designated First Mortgage Bonds 4 7/8% Series due 1987, all of the original
issue of $2,000,000 principal amount of bonds of a series designated First
Mortgage Bonds 4 3/4% Series due 1983, all of the original issue of $3,000,000
principal amount of bonds of a series designated First Mortgage Bonds 5 1/2%
Series due 1985, all of the original issue of $3,000,000 principal amount of
bonds of a series designated First Mortgage Bonds 5% Series due 1986, all of the
original issue of $5,000,000 principal amount of bonds of a series designated
First Mortgage Bonds 4 5/8% Series due 1988, all of the original issue of
$4,000,000 principal amount of bonds of a series designated First Mortgage Bonds
5 7/8% Series due 1991, all of the original issue of $15,000,000 principal
amount of bonds of a series designated First Mortgage Bonds 9% Series due 1991,
all of the original issue of $10,000,000

                                       2
principal amount of bonds of a series designated First Mortgage Bonds 6 7/8%
Series due 1992, all of the original issue of $12,000,000 principal amount of
bonds of a series designated First Mortgage Bonds 10% Series due 1995, and all
of the original issue of $20,000,000 principal amount of bonds of a series
designated First Mortgage Bonds 9 1/4% Series due 1996 and (ii) had outstanding
and secured by the Original Indenture, as so supplemented to the date hereof,
$3,745,000 (of an original issue of $7,000,000) principal amount of bonds of a
series designated First Mortgage Bonds 8% Series due 1997, $10,000,000 (of an
original issue of $10,000,000) principal amount of bonds of a series designated
First Mortgage Bonds 9.23% Series due 1999, $15,000,000 (of an original issue of
$15,000,000) principal amount of bonds of a series designated First Mortgage
Bonds 9.34% Series due 2019, $50,000,000 (of an original issue of $50,000,000)
principal amount of bonds of a series designated First Mortgage Bonds 9.57%
Series due 1996, $50,000,000 (of an original issue of $50,000,000) principal
amount of bonds of a series designated First Mortgage Bonds 7.20% Series due
2017, $30,000,000 (of an original issue of $30,000,000) principal amount of
bonds of a series designated First Mortgage Bonds 8.375% Series due 2002, and
$30,000,000 (of an original issue of $30,000,000) principal amount of bonds of a
series designated First Mortgage Bonds 7.125% Series due 2022; and
 
     WHEREAS, Article 3 of the Original Indenture provides that additional bonds
of any one or more series may be issued from time to time in accordance with and
subject to the conditions, provisions and limitations set forth in said Article
3; and
 
     WHEREAS, Section 2.02 of the Original Indenture provides that before any
bonds of any series, other than bonds of the First Series, shall be
authenticated and delivered, the Company shall execute and deliver to the
Trustee a supplemental indenture, in recordable form, containing the particulars
of the new series of bonds as required by said Section 2.02 and containing

appropriate provisions giving to such bonds the protection and security of the
Original Indenture; and
 
     WHEREAS, Section 14.01 of the Original Indenture provides, among other
things, that the Company, when authorized by a resolution of its Board of
Directors, and the Trustee from time to time may enter into an indenture or
indentures supplemental thereto and which thereafter shall form a part thereof
for any one or more of the following purposes, among others, to provide for the
creation of any series of bonds (other than bonds of the First Series),
designating the series to be created and specifying the form and provisions of
bonds of such series; and
 
     WHEREAS, Section 14.02 of the Original Indenture provides that the Trustee
is authorized to join with the Company in the execution of any such supplemental
indenture; and
 
     WHEREAS, the Company in the course of its business has acquired certain
additional properties, which properties are intended by the terms of the
Granting Clauses of the Original Indenture to be subject to the lien thereof;
and

                                       3
 
     WHEREAS, in accordance with the provisions of Section 4.12 and Section
14.01 of the Original Indenture, the Company desires in and by this
Twenty-Eighth Supplemental Indenture to record the description of and confirm
unto the Trustee such properties, which properties (except such as are reserved
or excepted from the lien and operation of the Indenture by virtue of the
exceptions contained in the Granting Clauses thereof) are now subject to the
lien of the Indenture by virtue of the provisions thereof conveying to the
Trustee property acquired after its execution and delivery; and
 
     WHEREAS, the Company now desires to create a new series of bonds under the
Indenture to be known and designated as its First Mortgage Bonds 6.05% Series
due 2019 (hereinafter sometimes called 'bonds of the Twentieth Series'); and
 
     WHEREAS, the Company proposes to execute and to request the Trustee to
authenticate and deliver up to $19,000,000 principal amount of bonds of the
Twentieth Series pursuant to the provisions of Sections 3.02 to 3.06, both
inclusive, of the Original Indenture; and
 
     WHEREAS, the bonds of the Twentieth Series and the Trustee's certificate to
be endorsed on such bonds are to be substantially in the form following (any of
the provisions of such bonds may be set forth on the reverse side thereof):
 
                     [FORM OF BOND OF THE TWENTIETH SERIES]
 
     THE BOND EVIDENCED BY THIS CERTIFICATE HAS BEEN ISSUED IN A PRIVATE
TRANSACTION, HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR REGISTERED OR QUALIFIED UNDER THE SECURITIES OR BLUE SKY LAWS OF ANY
STATE AND MAY NOT BE OFFERED, TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THAT ACT, SUCH LAWS AND THE
RULES AND REGULATIONS PROMULGATED THEREUNDER.
 

                       PENNSYLVANIA GAS AND WATER COMPANY
             (Formerly Scranton-Spring Brook Water Service Company)
                   First Mortgage Bond 6.05% Series due 2019
No.__________________________                         $_________________________
 
     PENNSYLVANIA GAS AND WATER COMPANY (formerly Scranton-Spring Brook Water
Service Company), a corporation organized and existing under the laws of the
Commonwealth of Pennsylvania (hereinafter sometimes called the 'Company'), for
value received, promises to pay to __________________, or registered assigns, on
January 1, 2019 (unless this bond shall have been called for previous redemption
and provision made for the payment of the redemption price thereof),
__________________ Dollars at the Company's office or agency in the Borough of
Manhattan, The City of New York, and, except as otherwise set forth below,
semi-annually on the first day of July and the first day of January in each year
commencing July 1, 1994, to pay interest thereon, at said office or agency,

                                       4
at the rate of 6.05% per annum from the interest payment date to which interest
has been paid next preceding the date of authentication of this bond (except
that if the date of authentication of this bond is an interest payment date for
bonds of this series to which interest has been paid it shall bear interest from
the date of authentication of this bond, and except that if this bond be
authenticated prior to the first interest payment date for bonds of this series,
it shall bear interest from December 1, 1993), until the Company's obligation
with respect to such principal sum shall be discharged; provided that, so long
as there is no existing default in the payment of interest, and except for the
payment of defaulted interest, the interest payable on any July 1 or January 1
will be paid to the person in whose name this bond was registered at the close
of business on the fifteenth day of June or the fifteenth day of December next
preceding such interest payment date; and further provided that the interest
payable on the bonds of this series shall be reduced to the extent that other
moneys then on deposit with PNC Bank, National Association, as trustee, or any
successor trustee (the 'IDA Trustee') under the Trust Indenture dated as of
December 1, 1993 (the 'Trust Indenture') from the Luzerne County Industrial
Development Authority (the 'Authority') to the IDA Trustee are available for the
purpose of paying interest on the bonds of this series and a credit in respect
thereof has been granted pursuant to the Trust Indenture. The principal of,
premium if any, and the interest on this bond shall be payable in any coin or
currency of the United States of America which at the time of payment shall be
legal tender for the payment of public and private debts.
 
     This bond is one of an issue of bonds of the Company, known as its First
Mortgage Bonds, issued and to be issued in one or more series under, and equally
and ratably secured (except as any sinking, amortization, improvement or other
fund, established in accordance with the provisions of the indenture hereinafter
mentioned, may afford additional security for the bonds of any particular
series) by, a certain mortgage and deed of trust, dated as of March 15, 1946
(hereinafter called the 'Original Indenture'), and by twenty-eight indentures
supplemental thereto (of which, the Seventeenth Supplemental Indenture, dated as
of October 15, 1967, the Eighteenth Supplemental Indenture, dated as of May 1,
1970, and the Twentieth Supplemental Indenture, dated as of March 1, 1976,
amended certain provisions of the Original Indenture) (said Original Indenture
and all said indentures supplemental thereto being hereinafter collectively
called the 'Indenture'), made by the Company to Guaranty Trust Company of New

York and, after the change of name of Guaranty Trust Company of New York to
Morgan Guaranty Trust Company of New York, to Morgan Guaranty Trust Company of
New York, as Trustee (hereinafter called the 'Trustee'), to which Indenture (and
to all additional indentures supplemental thereto) reference is hereby made for
a description of the property mortgaged, the nature and extent of the security,
the rights and limitations of rights of the Company, the Trustee, and the
holders of said bonds under the Indenture, and the terms and conditions upon
which said bonds are secured, to all of the provisions

                                       5
of which Indenture and of all such additional supplemental indentures in respect
of such security, including the provisions of the Indenture permitting the issue
of bonds of any series in respect of property which, under the restrictions and
limitations therein specified, may be subject to liens prior to the lien of the
Indenture, the holder, by accepting this bond, assents. To the extent permitted
by and as provided in the Indenture, the rights and obligations of the Company
and of the holders of said bonds (including those pertaining to any sinking or
other fund) may be changed and modified, with the consent of the Company, by the
holders of at least 75% in aggregate principal amount of the bonds then
outstanding (or, if one or more, but less than all, series of bonds are
affected, by the holders of at least 75% in aggregate principal amount of
outstanding bonds of such one or more series so affected), such percentage being
determined as provided in the Indenture; provided, however, that without the
consent of the holder hereof no such modification or alteration shall be made
which will extend the time of payment of the principal of, premium, if any, or
the interest on this bond or reduce the principal amount hereof, or premium, if
any, or the rate of interest hereon or effect any other modification of the
terms of payment of such principal or interest or will permit the creation of
any lien ranking prior to or on a parity with the lien of the Indenture on any
of the mortgaged property, or will deprive any non-assenting holder of this bond
of a lien upon the mortgaged property for the security of this bond, or will
reduce the percentage of bonds required for the aforesaid action under the
Indenture and provided further that, as provided in Section 4.02 of the
Twentieth Supplemental Indenture, when all bonds of all series issued prior to
January 1, 1976, shall cease to be outstanding, each reference to '75%' in this
sentence shall become '60%.' This bond is one of a series of bonds designated as
the First Mortgage Bonds 6.05% Series due 2019 of the Company.
 
     The bonds of this series are subject to redemption upon not less than
thirty (30) nor more than sixty (60) days' prior notice, in whole or in part,
under the circumstances set forth in paragraphs (A), (B) and (C), below.
 
     (A) The bonds of this series are subject to mandatory redemption, in whole
or in part, upon any redemption of the Luzerne County Industrial Development
Authority Exempt Facilities Revenue Refunding Bonds, 1993 Series A (Pennsylvania
Gas and Water Company Project) due January 1, 2019 (the '1993 Series A Bonds').
The principal amount of bonds of this series to be redeemed upon any redemption
of the 1993 Series A Bonds shall be equal to 100% of the principal amount of
1993 Series A Bonds which are to be redeemed. The redemption price of the bonds
of this series which are redeemed under the circumstances set forth in this
paragraph (A) shall be equal to 100% of the principal amount of the bonds of
this series to be redeemed plus interest accrued to the date fixed for
redemption except (i) in the case of bonds of this series which are redeemed
upon a redemption of the 1993 Series A Bonds at the option


                                       6
of the Authority (other than in an 'Extraordinary Optional Redemption,' as
defined in the Trust Indenture) upon the direction of the Company (an 'Optional
IDA Redemption') which occurs between January 1, 2004 and December 31, 2004,
inclusive, the redemption price shall be equal to 102% of the principal amount
of the bonds of this series to be redeemed plus interest accrued to the date
fixed for redemption and (ii) in the case of bonds of this series which are
redeemed upon an Optional IDA Redemption which occurs between January 1, 2005
and December 31, 2005, inclusive, the redemption price shall be equal to 101% of
the principal amount of the bonds of this series to be redeemed plus interest
accrued to the date fixed for redemption.
 
     (B) The bonds of this series are subject to mandatory redemption, in whole,
if the IDA Trustee declares the 1993 Series A Bonds to be immediately due and
payable under Section 9.02 of the Trust Indenture. The redemption price of the
bonds of this series which are redeemed under the circumstances set forth in
this paragraph (B) shall be equal to 100% of the principal amount of the bonds
of this series to be redeemed plus interest accrued to the date fixed for
redemption.
 
     (C) The bonds of this series are subject to mandatory redemption, in whole
or in part (but if in part on a pro rata basis with bonds of all other series
then outstanding under the Indenture), pursuant to the provisions of Section
8.13 of the Indenture. The redemption price of the bonds of this series which
are redeemed under the circumstances set forth in this paragraph (C) shall be
equal to 100% of the principal amount of the bonds of this series to be redeemed
plus interest accrued to the date fixed for redemption.
 
     If this bond shall be called for redemption, and payment of the redemption
price shall be duly provided by the Company as specified in the Indenture,
interest shall cease to accrue hereon from and after the date of redemption
fixed in the notice thereof.
 
     The principal of this bond may be declared or may become due prior to the
maturity date hereinbefore named, on the conditions, in the manner and at the
times set forth in the Indenture, upon the happening of a default as therein
defined.
 
     This bond is transferable by the registered owner hereof in person or by
his duly authorized attorney at the office or agency of the Company in the
Borough of Manhattan, The City of New York, upon surrender and cancellation of
this bond, and thereupon a new bond or bonds of the same series and maturity,
for a like aggregate principal amount, will be issued to the transferee in
exchange therefor, as provided in the Indenture. The Company and the Trustee and
any registrar and any paying agent may deem and treat the person in whose name
this bond is registered as the absolute owner hereof for the purpose of
receiving payment and for all other purposes.

                                       7
 
     This bond, alone or with other bonds of the same series and maturity, may
in like manner be exchanged at such office or agency for one or more new bonds
of the same series and maturity of the same aggregate principal amount. Upon

each such transfer or exchange the Company may require the payment of charges as
prescribed in the Indenture.
 
     No recourse under or upon any covenant or obligation of the Indenture, or
of any bonds thereby secured, or for any claim based thereon, or otherwise in
any manner in respect thereof, shall be had against any incorporator, subscriber
to the capital stock, stockholder, officer or director, as such, whether former,
present or future, of the Company or any successor corporation, either directly,
or indirectly through the Company or the Trustee, by the enforcement of any
subscription to capital stock, assessment or otherwise, or by any legal or
equitable proceeding by virtue of any constitution, statute, contract of
subscription or otherwise (including, without limiting the generality of the
foregoing, any proceeding to enforce any claimed liability of stockholders of
the Company based upon any theory of disregarding the corporate entity of the
Company or upon any theory that the Company was acting as the agent or
instrumentality of the stockholders), any and all such liability of
incorporators, stockholders, subscribers, officers and directors, as such, being
released by the holder hereof, by the acceptance of this bond, and being
likewise waived and released by the terms of the Indenture under which this bond
is issued.
 
     This bond shall not be valid or become obligatory for any purpose until the
certificate of authentication endorsed hereon shall have been signed by Morgan
Guaranty Trust Company of New York, or its successor, as Trustee under the
Indenture.
 
     IN WITNESS WHEREOF, PENNSYLVANIA GAS AND WATER COMPANY has caused this bond
to be signed in its name by, or to bear the facsimile signature of, its
President or a Vice President, and its corporate seal to be affixed hereto and
attested by, or to bear the facsimile signature of, its Secretary or an
Assistant Secretary.
 
Dated:
 
                                       PENNSYLVANIA GAS AND WATER COMPANY
                                       By:______________________________________
                Vice President
 
Attest:
               Secretary

                                       8
 
               [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
 
     This bond is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.
 
MORGAN GUARANTY TRUST COMPANY
  OF NEW YORK, as Trustee
By:________________________________
          Authorized Officer
 
                             [End of Form of Bond]

 
     WHEREAS, all requirements of law and of the restated articles of
incorporation, as amended, and by-laws of the Company, including all requisite
action on the part of its directors and officers, relating to the execution of
this Twenty-Eighth Supplemental Indenture have been complied with and observed,
and all things necessary to make this Twenty-Eighth Supplemental Indenture a
valid and legally binding instrument in accordance with its terms for the
security of all bonds from time to time issued under the Indenture have
happened, been done and been performed, and the issue of the bonds of the
Twentieth Series, hereinafter referred to, has been in all respects duly
authorized;
 
     NOW, THEREFORE, THIS TWENTY-EIGHTH SUPPLEMENTAL INDENTURE WITNESSETH: That
Pennsylvania Gas and Water Company, intending to be legally bound, in
consideration of the premises and of One Dollar ($1.00) to it duly paid by the
Trustee at or before the ensealing and delivery of these presents, the receipt
whereof is hereby acknowledged, and in order to secure the payment of the
principal of, premium, if any, and interest on all bonds from time to time
outstanding under the Indenture, according to the terms of said bonds and to
secure the performance and observance of all the covenants and conditions
therein and in the Indenture contained, and to declare the terms and conditions
upon and subject to which the bonds of the Twentieth Series are and are to be
issued and secured, hath granted, bargained, sold, warranted, aliened, remised,
released, conveyed, assigned, transferred, mortgaged, created a security
interest in, pledged, set over and confirmed, and by these presents doth grant,
bargain, sell, warrant, alien, remise, release, convey, assign, transfer,
mortgage, create a security interest in, pledge, set over and confirm unto
Morgan Guaranty Trust Company of New York, as Trustee, and its successor or
successors in the trust and its or their assigns forever, the following
described property -- that is to say:

                                       9
 
     All property, real, personal and mixed, tangible and intangible, of the
Company whether now owned or hereafter acquired by it (except such property as
is expressly excepted from the lien and the operation of the Indenture).
 
     Without limitation of the foregoing, all real estate and interests in or
relating to real estate, plants, properties and equipment, and all pumping and
transmission systems and facilities, together with all franchises, grants,
easements, permits, privileges, appurtenances, tenements and other rights and
property thereunto belonging or appertaining, whether now owned by the Company
or hereafter acquired by it and used in its business of impounding, storing,
transporting and selling water, or in its business of manufacturing, storing,
transporting and selling gas, at wholesale or retail, for domestic, commercial,
industrial and municipal use and consumption.
 
     Also, without limitation of the foregoing, all buildings, improvements,
standpipes, towers, reservoirs, wells, springs, flumes, sluices, canals, basins,
cribs, mains, conduits, hydrants, valves, pipes, pipe lines, service pipes,
tanks, shops, structures, purification systems, pumping stations, pumps, meters,
fixtures, machinery and equipment, used or useful for the impounding, procuring,
transmission or distribution of water; all generators, conveyors, purifiers,
holders, power plants, fixtures, engines, boilers, pumps, meters, transmission

and distribution mains, machinery and equipment used or useful for the
manufacture, transmission or distribution of gas; and all and every character of
apparatus whatsoever used or useful for procuring, manufacturing, transmitting
or distributing water or gas; whether the same or any thereof are now owned by
the Company or hereafter acquired by it.
 
     Also, without limitation of the foregoing, all real estate and interests in
real estate acquired by sale or by merger of subsidiary or constituent
companies, now owned or as may be subsequently acquired by the Company.
 
     The property covered by the lien of the Indenture shall include
particularly, among other property, without prejudice to the generality of the
language hereinbefore or hereinafter contained, the following described property
(which generally includes property additions through October 31, 1993, except
such property as is expressly excepted from the lien and operation of the
Indenture):
 
                                       I
 
     The following piece or parcel of land situate in the County of Lackawanna
and Commonwealth of Pennsylvania, to wit:
 
          01. Parcel of land situate in the Township of Greenfield, Lackawanna
     County, from John Malinchak and Linda Malinchak, husband and wife, by Deed
     dated March 5, 1993 and recorded March 10, 1993 in Lackawanna

                                       10
     County Deed Book 1426 at Page 281. Containing Three (3.0) acres, more or
     less.
 
          02. Partial interest in parcel of land situate in Borough of Jessup,
     Lackawanna County, from John L. Kemmerer, Jr. and Mary Elizabeth Kemmerer,
     his wife, by Deed dated October 8, 1993 and recorded October 22, 1993 in
     Lackawanna County Deed Book 1451 at Page 368. Containing Four Hundred
     Thirty-Nine (439.0) acres and allowances.
 
          03. Parcel of land situate in the Borough of Archbald, Lackawanna
     County, from Pine Line, Inc., by Deed dated October 18, 1993 and recorded
     October 19, 1993 in Lackawanna County Deed Book 1450 at Page 764.
     Containing Ninety-two One Hundredths (0.92) of an acre.
 
                                       II
 
     The following piece or parcel of land situate in the County of Luzerne and
Commonwealth of Pennsylvania, to wit:
 
          01. Four (4) parcels of land situate in the Township of Conyngham,
     Township of Salem and Borough of Shickshinny, Luzerne County, from
     Mocanaqua Water Company and Shickshinny Water Company, by Deed dated April
     5, 1993 and recorded April 6, 1993 in Luzerne County Deed Book 2453 at Page
     517. Containing One Hundred Ten and Four-hundred Sixteen Thousandths
     (110.416) acres, more or less.
 
                                      III

 
     The following right-of-way and/or easements situate in the County of
Columbia and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the Township of Scott, Columbia
     County, from Ira S. Hauck, et ux, by Indenture dated February 9, 1993 and
     recorded March 8, 1993 in Columbia County Record Book 528 at Page 399.
 
          02. Right-of-way for gas pipeline in the Township of Scott, Columbia
     County, from Harland H. Shoemaker, et ux, by Indenture dated February 9,
     1993 and recorded March 8, 1993 in Columbia County Record Book 528 at Page
     402.
 
          03. Right-of-way for gas pipeline in the Borough of Berwick, Columbia
     County, from Berwick Hospital Center Foundation, by Indenture dated
     February 23, 1993 and recorded March 8, 1993 in Columbia County Record Book
     528 at Page 405.

                                       11
 
          04. Right-of-way for gas pipeline in the Township of South Centre,
     Columbia County, from Star Kist Foods, Inc., et al, by Indenture dated July
     22, 1993 and recorded August 24, 1993 in Columbia County Record Book 544 at
     Page 830.
 
          05. Right-of-way for gas pipeline in the Township of South Centre,
     Columbia County, from Frank C. Baker, et al, by Indenture dated July 30,
     1993 and recorded August 24, 1993 in Columbia County Record Book 544 at
     Page 839.
 
          06. Right-of-way for gas pipeline in the Township of South Centre,
     Columbia County, from Frank C. Baker, et al, by Indenture dated July 30,
     1993 and recorded August 24, 1993 in Columbia County Record Book 544 at
     Page 835.
 
          07. Right-of-way for gas pipeline in the Town of Bloomsburg, Columbia
     County, from Kawneer Company, Inc., by Indenture dated August 4, 1993 and
     recorded August 24, 1993 in Columbia County Record Book 544 at Page 843.
 
          08. Right-of-way for gas pipeline in the Town of Bloomsburg, Columbia
     County, from Michael A. Chyko, et ux, by Indenture dated October 25, 1993
     and recorded October 29, 1993 in Columbia County Record Book 551 at Page
     159.
 
                                       IV
 
     The following right-of-way and/or easements situate in the County of
Lackawanna and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Scranton Mall Associates, by Indenture dated March 27, 1992
     and recorded December 14, 1992 in Lackawanna County Deed Book 1417 at Page
     461.
 

          02. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Evelyn Bleiler Hammond, by Indenture dated October 2, 1992 and
     recorded December 14, 1992 in Lackawanna County Deed Book 1417 at Page 468.
 
          03. Right-of-way for gas pipeline in the Borough of Olyphant,
     Lackawanna County, from WEA Manufacturing, Inc., by Indenture dated October
     8, 1992 and recorded December 14, 1992 in Lackawanna County Deed Book 1417
     at Page 472.
 
          04. Right-of-way for gas pipeline in the Borough of Jessup, Lackawanna
     County, from Fastenal Company, Inc., by Indenture dated

                                       12
     October 13, 1992 and recorded December 14, 1992 in Lackawanna County Deed
     Book 1417 at Page 479.
 
          05. Right-of-way for gas pipeline in the Borough of Olyphant,
     Lackawanna County, from Thomas C. McGowan, et ux, by Indenture dated
     October 27, 1992 and recorded December 14, 1992 in Lackawanna County Deed
     Book 1417 at Page 484.
 
          06. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Joseph M. Harvilchuck, et ux, by Indenture dated November 2,
     1992 and recorded December 14, 1992 in Lackawanna County Deed Book 1417 at
     Page 488.
 
          07. Right-of-way for gas pipeline in the Township of South Abington,
     Lackawanna County, from Samuel R. Ventura, et ux, by Indenture dated
     December 3, 1992 and recorded December 14, 1992 in Lackawanna County Deed
     Book 1417 at Page 492.
 
          08. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from City of Scranton, by Indenture dated December 8, 1992 and
     recorded January 13, 1993 in Lackawanna County Deed Book 1420 at Page 448.
 
          09. Right-of-way for water pipeline in the Borough of Jessup,
     Lackawanna County, from Martin C. Fischer, et al, by Indenture dated
     December 16, 1992 and recorded January 13, 1993 in Lackawanna County Deed
     Book 1420 at Page 444.
 
          10. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Sandvik Steel Company, by Indenture dated December 18, 1992
     and recorded January 13, 1993 in Lackawanna County Deed Book 1420 at Page
     440.
 
          11. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Lackawanna County Industrial Development Authority, et al, by
     Indenture dated December 23, 1992 and recorded August 25, 1993 in
     Lackawanna County Deed Book 1444 at Page 364.
 
          12. Right-of-way for gas pipeline in the Borough of Jessup, Lackawanna
     County, from Eric M. Spatt, et ux, by Indenture dated December 28, 1992 and
     recorded January 13, 1993 in Lackawanna County Deed Book 1420 at Page 435.
 

          13. Right-of-way for gas pipeline in the Township of South Abington,
     Lackawanna County, from Delbert P. Keisling, Jr., et ux, by Indenture dated
     December 30, 1992 and recorded January 13, 1993 in Lackawanna County Deed
     Book 1420 at Page 430.

                                       13
 
          14. Right-of-way for gas pipeline in the Borough of Mayfield,
     Lackawanna County, from Thomas Greene, et ux, by Indenture dated January 4,
     1993 and recorded February 9, 1993 in Lackawanna County Deed Book 1423 at
     Page 230.
 
          15. Right-of-way for gas pipeline in the City of Carbondale,
     Lackawanna County, from Cottage Hose Ambulance Corps, Inc., by Indenture
     dated January 27, 1993 and recorded February 9, 1993 in Lackawanna County
     Deed Book 1423 at Page 240.
 
          16. Right-of-way for gas pipeline in the Borough of Blakely,
     Lackawanna County, from Edwin A. Abrahamsen, et al, by Indenture dated
     February 1, 1993 and recorded February 9, 1993 in Lackawanna County Deed
     Book 1423 at Page 235.
 
          17. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from James Gress, et ux, by Indenture dated February 3, 1993 and
     recorded February 9, 1993 in Lackawanna County Deed Book 1423 at Page 245.
 
          18. Right-of-way for gas pipeline in the Borough of Throop, Lackawanna
     County, from Joseph Quinlan, et ux, by Indenture dated February 11, 1993
     and recorded March 8, 1993 in Lackawanna County Deed Book 1426 at Page 55.
 
          19. Right-of-way for gas pipeline in the Borough of Archbald,
     Lackawanna County, from Borough of Archbald, by Indenture dated February
     17, 1993 and recorded March 8, 1993 in Lackawanna County Deed Book 1426 at
     Page 46.
 
          20. Right-of-way for gas pipeline in the Borough of Throop, Lackawanna
     County, from Robert J. Karlavige, et ux, by Indenture dated February 18,
     1993 and recorded March 8, 1993 in Lackawanna County Deed Book 1426 at Page
     51.
 
          21. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from United Neighborhood Housing Corporation, by Indenture dated
     February 19, 1993 and recorded March 8, 1993 in Lackawanna County Deed Book
     1426 at Page 41.
 
          22. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Richard J. Matthews, et ux, by Indenture dated February 25,
     1993 and recorded March 8, 1993 in Lackawanna County Deed Book 1426 at Page
     37.
 
          23. Right-of-way for gas pipeline in the Borough of Blakely,
     Lackawanna County, from Robert Polidori, et ux, by Indenture dated

                                       14

     February 25, 1993 and recorded March 8, 1993 in Lackawanna County Deed Book
     1426 at Page 32.
 
          24. Right-of-way for water pipeline in the Borough of Blakely,
     Lackawanna County, from Robert Polidori, et ux, by Indenture dated February
     25, 1993 and recorded March 8, 1993 in Lackawanna County Deed Book 1426 at
     Page 27.
 
          25. Right-of-way for gas pipeline in the Township of South Abington,
     Lackawanna County, from Corporation of the Presiding Bishop of the Church
     of Jesus Christ of Latter Day Saints, by Indenture dated March 8, 1993 and
     recorded April 14, 1993 in Lackawanna County Deed Book 1429 at Page 436.
 
          26. Right-of-way for water pipeline in the City of Carbondale,
     Lackawanna County, from Dr. Thomas H. Coleman, et al, by Indenture dated
     March 23, 1993 and recorded April 14, 1993 in Lackawanna County Deed Book
     1429 at Page 441.
 
          27. Right-of-way for gas pipeline in the City of Carbondale,
     Lackawanna County, from Dr. Thomas H. Coleman, et al, by Indenture dated
     March 23, 1993 and recorded April 14, 1993 in Lackawanna County Deed Book
     1429 at Page 447.
 
          28. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from James Granville, Sr., et ux, by Indenture dated March 26, 1993
     and recorded April 14, 1993 in Lackawanna County Deed Book 1429 at Page
     453.
 
          29. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Gerald M. Borosky, et ux, by Indenture dated March 26, 1993
     and recorded April 14, 1993 in Lackawanna County Deed Book 1429 at Page
     457.
 
          30. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Walter S. Chesar, et ux, by Indenture dated March 26, 1993 and
     recorded April 14, 1993 in Lackawanna County Deed Book 1429 at Page 461.
 
          31. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Bruce Thomas Bevilacqua, et ux, by Indenture dated March 29,
     1993 and recorded April 14, 1993 in Lackawanna County Deed Book 1429 at
     Page 465.
 
          32. Right-of-way for gas pipeline in the Borough of Old Forge,
     Lackawanna County, from Lena Lockett, by Indenture dated April 21, 1993

                                       15
     and recorded May 17, 1993 in Lackawanna County Deed Book 1432 at Page 239.
 
          33. Right-of-way for gas pipeline in the Borough of Archbald,
     Lackawanna County, from Charles J. Passeri, et ux, by Indenture dated April
     21, 1993 and recorded May 17, 1993 in Lackawanna County Deed Book 1432 at
     Page 243.
 
          34. Right-of-way for water pipeline in the Borough of Archbald,

     Lackawanna County, from Charles J. Passeri, et ux, by Indenture dated April
     21, 1993 and recorded May 17, 1993 in Lackawanna County Deed Book 1432 at
     Page 247.
 
          35. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from James F. Eiden, et ux, by Indenture dated April 22, 1993 and
     recorded May 17, 1993 in Lackawanna County Deed Book 1432 at Page 251.
 
          36. Right-of-way for gas pipeline in the City of Carbondale,
     Lackawanna County, from Wan Sanderson, by Indenture dated April 27, 1993
     and recorded May 17, 1993 in Lackawanna County Deed Book 1432 at Page 255.
 
          37. Right-of-way for gas pipeline in the Borough of Old Forge,
     Lackawanna County, from Ann Killino, by Indenture dated April 29, 1993 and
     recorded May 17, 1993 in Lackawanna County Deed Book 1432 at Page 259.
 
          38. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from School District of the City of Scranton, by Indenture dated
     May 7, 1993 and recorded May 17, 1993 in Lackawanna County Deed Book 1432
     at Page 263.
 
          39. Right-of-way for water pipeline in the Borough of Archbald,
     Lackawanna County, from Pennsylvania Power & Light Company, by Indenture
     dated May 4, 1993 and recorded June 30, 1993 in Lackawanna County Deed Book
     1438 at Page 178.
 
          40. Right-of-way for gas pipeline in the Borough of Taylor, Lackawanna
     County, from Trustees of the Church of God, Borough of Taylor, County of
     Lackawanna, by Indenture dated May 13, 1993 and recorded June 30, 1993 in
     Lackawanna County Deed Book 1438 at Page 185.
 
          41. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Thomas George Bryan, et ux, by Indenture dated May 17,

                                       16
     1993 and recorded June 30, 1993 in Lackawanna County Deed Book 1438 at Page
     190.
 
          42. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Robert B. Brady, et ux, by Indenture dated June 9, 1993 and
     recorded June 30, 1993 in Lackawanna County Deed Book 1438 at Page 194.
 
          43. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Paul Grado, Sr., by Indenture dated June 16, 1993 and recorded
     June 30, 1993 in Lackawanna County Deed Book 1438 at Page 198.
 
          44. Right-of-way for gas pipeline in the Township of Carbondale,
     Lackawanna County, from Michael C. Figliomeni, by Indenture dated June 17,
     1993 and recorded June 30, 1993 in Lackawanna County Deed Book 1438 at Page
     202.
 
          45. Right-of-way for water pipeline in the Borough of Archbald,
     Lackawanna County, from Northpoint Associates, Inc., by Indenture dated
     July 2, 1993 and recorded August 25, 1993 in Lackawanna County Deed Book

     1444 at Page 369.
 
          46. Right-of-way for gas pipeline in the Borough of Archbald,
     Lackawanna County, from Northpoint Associates, Inc., by Indenture dated
     July 2, 1993 and recorded August 25, 1993 in Lackawanna County Deed Book
     1444 at Page 374.
 
          47. Right-of-way for gas pipeline in the Borough of Dickson City,
     Lackawanna County, from Zigmund Enterprises, Inc., by Indenture dated July
     14, 1993 and recorded August 25, 1993 in Lackawanna County Deed Book 1444
     at Page 379.
 
          48. Right-of-way for gas pipeline in the Township of South Abington,
     Lackawanna County, from Deerfield Village, by Indenture dated July 14, 1993
     and recorded August 25, 1993 in Lackawanna County Deed Book 1444 at Page
     384.
 
          49. Right-of-way for water pipeline in the Township of South Abington,
     Lackawanna County, from Deerfield Village, by Indenture dated July 14, 1993
     and recorded August 25, 1993 in Lackawanna County Deed Book 1444 at Page
     388.
 
          50. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Omoo Lamira Chase Shook, et vir, by Indenture dated August 13,
     1993 and recorded August 25, 1993 in Lackawanna County Deed Book 1444 at
     Page 392.

                                       17
 
          51. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Neil William Rogers, by Indenture dated August 13, 1993 and
     recorded August 25, 1993 in Lackawanna County Deed Book 1444 at Page 396.
 
          52. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Mary Alice Noldy, by Indenture dated August 13, 1993 and
     recorded August 25, 1993 in Lackawanna County Deed Book 1444 at Page 400.
 
          53. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Louise Zacker, by Indenture dated August 16, 1993 and recorded
     August 25, 1993 in Lackawanna County Deed Book 1444 at Page 404.
 
          54. Right-of-way for gas pipeline in the Borough of Moosic, Lackawanna
     County, from Frank Decker, et ux, by Indenture dated August 31, 1993 and
     recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page 543.
 
          55. Right-of-way for gas pipeline in the Borough of Moosic and City of
     Scranton, Lackawanna County, from Hub Management, Inc., by Indenture dated
     August 31, 1993 and recorded October 19, 1993 in Lackawanna County Deed
     Book 1450 at Page 561.
 
          56. Right-of-way for water pipeline in the Borough of Moosic and City
     of Scranton, Lackawanna County, from Hub Management, Inc., by Indenture
     dated August 31, 1993 and recorded October 19, 1993 in Lackawanna County
     Deed Book 1450 at Page 555.

 
          57. Right-of-way for gas pipeline in the Township of Fell, Lackawanna
     County, from Gerald A. Gravine, by Indenture dated September 3, 1993 and
     recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page 551.
 
          58. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Charles J. Blazonis, et ux, by Indenture dated September 3,
     1993 and recorded October 19, 1993 in Lackawanna County Deed Book 1450 at
     Page 547.
 
          59. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from James Baress, by Indenture dated September 3, 1993 and
     recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page 567.
 
          60. Right-of-way for gas pipeline in the Township of Carbondale,
     Lackawanna County, from Thomas V. Motts, et ux, by Indenture dated

                                       18
     September 8, 1993 and recorded October 19, 1993 in Lackawanna County Deed
     Book 1450 at Page 571.
 
          61. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from William Popovich, et ux, by Indenture dated September 13, 1993
     and recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page
     575.
 
          62. Right-of-way for gas pipeline in the City of Scranton, Lackawanna
     County, from Keyser Terrace, Inc., by Indenture dated September 15, 1993
     and recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page
     584.
 
          63. Right-of-way for water pipeline in the City of Scranton,
     Lackawanna County, from Keyser Terrace, Inc., by Indenture dated September
     15, 1993 and recorded October 19, 1993 in Lackawanna County Deed Book 1450
     at Page 579.
 
          64. Right-of-way for gas pipeline in the Township of South Abington,
     Lackawanna County, from James Scantzos, et ux, by Indenture dated September
     15, 1993 and recorded October 19, 1993 in Lackawanna County Deed Book 1450
     at Page 589.
 
          65. Right-of-way for gas pipeline in the Township of Scott, Lackawanna
     County, from Scott Plaza, Ltd., by Indenture dated September 15, 1993 and
     recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page 594.
 
          66. Right-of-way for gas pipeline in the Borough of Blakely,
     Lackawanna County, from Magdalene Spegar, Single, by Indenture dated
     September 24, 1993 and recorded October 19, 1993 in Lackawanna County Deed
     Book 1450 at Page 598.
 
          67. Right-of-way for gas pipeline in the Borough of Throop, Lackawanna
     County, from Anthony A. Andrelchik, Single, by Indenture dated October 5,
     1993 and recorded October 19, 1993 in Lackawanna County Deed Book 1450 at
     Page 602.

 
          68. Right-of-way for gas pipeline in the Borough of Throop, Lackawanna
     County, from John P. Yankowski, by Indenture dated October 5, 1993 and
     recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page 606.
 
          69. Right-of-way for gas pipeline in the Borough of Clarks Green,
     Lackawanna County, from Margo Portanova, by Indenture dated October 6, 1993
     and recorded October 19, 1993 in Lackawanna County Deed Book 1450 at Page
     610.

                                       19
 
          70. Right-of-way for gas pipeline in the Borough of Clarks Green,
     Lackawanna County, from David T. Richards, et ux, by Indenture dated
     October 6, 1993 and recorded October 19, 1993 in Lackawanna County Deed
     Book 1450 at Page 614.
 
          71. Right-of-way for gas pipeline in the Borough of Old Forge,
     Lackawanna County, from Vincent Piccolini, et al, by Indenture dated
     October 12, 1993 and recorded October 19, 1993 in Lackawanna County Deed
     Book 1450 at Page 618.
 
          72. Right-of-way for access and pipelines in the Borough of Archbald,
     Lackawanna County, from Pine Line, Inc., by Indenture dated October 18,
     1993 and recorded October 19, 1993 in Lackawanna County Deed Book 1450 at
     Page 764.
 
          73. Right-of-way for gas pipeline in the Borough of Dickson City,
     Lackawanna County, from Aldi, Inc., by Indenture dated October 18, 1993 and
     recorded October 29, 1993 in Lackawanna County Deed Book 1452 at Page 273.
 
          74. Right-of-way for gas pipeline in the Township of South Abington,
     Lackawanna County, from Rendon Corporation, by Indenture dated October 19,
     1993 and recorded October 29, 1993 in Lackawanna County Deed Book 1452 at
     Page 277.
 
          75. Right-of-way for gas pipeline in the Township of South Abington,
     Lackawanna County, from Vincent Piazza, et ux, by Indenture dated October
     20, 1993 and recorded October 29, 1993 in Lackawanna County Deed Book 1452
     at Page 268.
 
                                       V
 
     The following right-of-way and/or easements situate in the County of
Luzerne and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for ground bed for cathodic protection in the
     Township of Plains, Luzerne County, from Elizabeth Kuzemko, by Indenture
     dated October 16, 1992 and recorded August 25, 1993 in Luzerne County Deed
     Book 2466 at Page 827.
 
          02. Right-of-way for gas pipeline in the Township of Wilkes-Barre,
     Luzerne County, from William H. Corgan, et al, by Indenture dated October
     29, 1992 and recorded December 9, 1992 in Luzerne County Deed Book 2440 at

     Page 1135.
 
          03. Right-of-way for gas pipeline in the City of Wilkes-Barre, Luzerne
     County, from Harry Yale, et ux, by Indenture dated November 11, 1992 and

                                       20
     recorded December 9, 1992 in Luzerne County Deed Book 2440 at Page 1131.
 
          04. Right-of-way for gas pipeline in the Township of Wright, Luzerne
     County, from Christ Methodist Church of Mountaintop, by Indenture dated
     November 12, 1992 and recorded December 9, 1992 in Luzerne County Deed Book
     2440 at Page 1140.
 
          05. Right-of-way for access road in the Township of Jenkins, Luzerne
     County, from Coolbaugh Sand and Stone, Inc., by Indenture dated November
     25, 1992 and recorded December 9, 1992 in Luzerne County Deed Book 2440 at
     Page 1156.
 
          06. Right-of-way for gas pipeline in the Borough of Kingston, Luzerne
     County, from Luzerne County Industrial Development Authority, et al, by
     Indenture dated November 30, 1992 and recorded December 9, 1992 in Luzerne
     County Deed Book 2440 at Page 1161.
 
          07. Right-of-way for gas pipeline in the Township of Jackson, Luzerne
     County, from Anthony S. Garbush, et ux, by Indenture dated December 2, 1992
     and recorded December 9, 1992 in Luzerne County Deed Book 2440 at Page
     1170.
 
          08. Right-of-way for gas pipeline in the Borough of Duryea, Luzerne
     County, from Arnold J. Dommes, et ux, by Indenture dated December 8, 1992
     and recorded December 9, 1992 in Luzerne County Deed Book 2440 at Page
     1166.
 
          09. Right-of-way for gas pipeline in the City of Wilkes-Barre, Luzerne
     County, from Edward S. Miscavage, et ux, by Indenture dated December 9,
     1992 and recorded January 6, 1993 in Luzerne County Deed Book 2443 at Page
     727.
 
          10. Right-of-way for gas pipeline in the Township of Plains, Luzerne
     County, from Daniel E. Rozanski, by Indenture dated December 9, 1992 and
     recorded January 6, 1993 in Luzerne County Deed Book 2443 at Page 731.
 
          11. Right-of-way for gas pipeline in the Township of Fairview, Luzerne
     County, from Deborah S. Gabriel, by Indenture dated December 14, 1992 and
     recorded January 6, 1993 in Luzerne County Deed Book 2443 at Page 735.
 
          12. Right-of-way for gas pipeline in the Township of Hanover, Luzerne
     County, from Frank J. Ciavarella, et ux, by Indenture dated December 14,
     1992 and recorded January 6, 1993 in Luzerne County Deed Book 2443 at Page
     739.

                                       21
 
          13. Right-of-way for gas pipeline in the Township of Kingston, Luzerne

     County, from Crescenzo G. Calise, et ux, by Indenture dated December 15,
     1992 and recorded January 6, 1993 in Luzerne County Deed Book 2443 at Page
     749.
 
          14. Right-of-way for water pipeline in the Township of Plains, Luzerne
     County, from Blue Coal Corporation, by Indenture dated December 16, 1992
     and recorded January 6, 1993 in Luzerne County Deed Book 2443 at Page 842.
 
          15. Right-of-way for water pipeline in the Borough of Exeter, Luzerne
     County, from JEF Development Associates, Ltd, by Indenture dated December
     21, 1992 and recorded January 6, 1993 in Luzerne County Deed Book 2443 at
     Page 848.
 
          16. Right-of-way for gas pipeline in the Township of Wilkes-Barre,
     Luzerne County, from Henry P. Fricchione, et ux, by Indenture dated
     December 21, 1992 and recorded January 6, 1993 in Luzerne County Deed Book
     2443 at Page 853.
 
          17. Right-of-way for access in the Township of Jenkins and the
     Township of Pittston, Luzerne County, from IRECO, by Indenture dated
     December 22, 1992 and recorded March 5, 1993 in Luzerne County Deed Book
     2449 at Page 802.
 
          18. Right-of-way for water pipeline in the Borough of Courtdale,
     Luzerne County, from John A. Connolly, Jr., et al, by Indenture dated
     December 28, 1992 and recorded January 6, 1993 in Luzerne County Deed Book
     2443 at Page 6.
 
          19. Right-of-way for gas pipeline in the Township of Dallas, Luzerne
     County, from Michael J. Kozich, et ux, by Indenture dated January 7, 1993
     and recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page 197.
 
          20. Right-of-way for gas pipeline in the Borough of Luzerne, Luzerne
     County, from David J. Blight, et ux, by Indenture dated January 11, 1993
     and recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page 193.
 
          21. Right-of-way for gas pipeline in the Township of Lehman, Luzerne
     County, from Robert G. Root, et ux, by Indenture dated January 14, 1993 and
     recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page 189.
 
          22. Right-of-way for gas pipeline in the Township of Jackson, Luzerne
     County, from Ronald L. Hillard, et ux, by Indenture dated January 14, 1993

                                       22
     and recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page 185.
 
          23. Right-of-way for gas pipeline in the Township of Jackson, Luzerne
     County, from James Leo Dalkiewicz, et ux, by Indenture dated January 14,
     1993 and recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page
     181.
 
          24. Right-of-way for gas pipeline in the Borough of Luzerne, Luzerne
     County, from Martin Mullen, et ux, by Indenture dated January 14, 1993 and
     recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page 177.

 
          25. Right-of-way for gas pipeline in the Borough of Sugar Notch,
     Luzerne County, from Gerald G. Decker, et al, by Indenture dated January
     19, 1993 and recorded February 8, 1993 in Luzerne County Deed Book 2447 at
     Page 172.
 
          26. Right-of-way for gas pipeline in the Township of Hanover, Luzerne
     County, from Mericle Development Corporation, by Indenture dated January
     22, 1993 and recorded February 8, 1993 in Luzerne County Deed Book 2447 at
     Page 167.
 
          27. Right-of-way for gas pipeline in the Borough of Sugar Notch,
     Luzerne County, from Greater Wilkes-Barre Industrial Fund, Inc., by
     Indenture dated January 25, 1993 and recorded February 8, 1993 in Luzerne
     County Deed Book 2447 at Page 162.
 
          28. Right-of-way for gas pipeline in the Township of Exeter, Luzerne
     County, from Nathan Sands, by Indenture dated January 28, 1993 and recorded
     February 8, 1993 in Luzerne County Deed Book 2447 at Page 158.
 
          29. Right-of-way for gas pipeline in the Township of Plains, Luzerne
     County, from Rockville Fabrics Corporation, by Indenture dated January 28,
     1993 and recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page
     153.
 
          30. Right-of-way for gas pipeline in the City of Wilkes-Barre, Luzerne
     County, from Salim Elmir, et al, by Indenture dated January 28, 1993 and
     recorded February 8, 1993 in Luzerne County Deed Book 2447 at Page 149.
 
          31. Right-of-way for gas pipeline in the Township of Plains, Luzerne
     County, from County of Luzerne, by Indenture dated February 8, 1993 and
     recorded March 5, 1993 in Luzerne County Deed Book 2449 at Page 796.
 
          32. Right-of-way for gas pipeline in the Borough of Wyoming, Luzerne
     County, from Anthony Scalzo, et al, by Indenture dated February 18, 1993

                                       23
     and recorded March 5, 1993 in Luzerne County Deed Book 2449 at Page 792.
 
          33. Right-of-way for gas pipeline in the Township of Salem, Luzerne
     County, from Berwick Hospital Center Foundation, by Indenture dated
     February 23, 1993 and recorded March 5, 1993 in Luzerne County Deed Book
     2449 at Page 787.
 
          34. Right-of-way for gas pipeline in the Borough of Sugar Notch,
     Luzerne County, from Gerald G. Decker, et al, by Indenture dated February
     26, 1993 and recorded March 5, 1993 in Luzerne County Deed Book 2449 at
     Page 783.
 
          35. Right-of-way for gas pipeline in the City of Wilkes-Barre, Luzerne
     County, from John J. Mutter, et ux, by Indenture dated February 26, 1993
     and recorded March 5, 1993 in Luzerne County Deed Book 2449 at Page 779.
 
          36. Right-of-way for gas pipeline in the Borough of Wyoming, Luzerne

     County, from Michael Blandina, by Indenture dated March 9, 1993 and
     recorded March 31, 1993 in Luzerne County Deed Book 2452 at Page 916.
 
          37. Right-of-way for gas pipeline in the Township of Plains, Luzerne
     County, from Francis J. Marcinko, et ux, by Indenture dated March 11, 1993
     and recorded March 31, 1993 in Luzerne County Deed Book 2452 at Page 912.
 
          38. Right-of-way for gas pipeline in the Township of Hanover, Luzerne
     County, from Arnold K. Biscontini, by Indenture dated March 12, 1993 and
     recorded March 31, 1993 in Luzerne County Deed Book 2452 at Page 907.
 
          39. Right-of-way for gas and water pipelines in the City of Wilkes-
     Barre, Luzerne County, from Mercy Hospital of Wilkes-Barre, Pa., by
     Indenture dated March 22, 1993 and recorded August 25, 1993 in Luzerne
     County Deed Book 2466 at Page 872.
 
          40. Right-of-way for gas pipeline in the City of Nanticoke, Luzerne
     County, from Glad Tidings Assembly of God Church, by Indenture dated March
     29, 1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at
     Page 880.
 
          41. Right-of-way for water pipeline in the Borough of Shickshinny,
     Luzerne County, from Shickshinny Water Company and Mocanaqua Water Company,
     by Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne
     County Deed Book 2453 at Page 517.
 
          42. Right-of-way for access in the Borough of Shickshinny, Luzerne
     County, from Shickshinny Water Company and Mocanaqua Water

                                       24
     Company, by Indenture dated April 5, 1993 and recorded April 6, 1993 in
     Luzerne County Deed Book 2453 at Page 517.
 
          43. Right-of-way for water pipeline in the Township of Salem, Luzerne
     County, from Shickshinny Water Company and Mocanaqua Water Company, by
     Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne County
     Deed Book 2453 at Page 517.
 
          44. Right-of-way for water pipeline in the Township of Salem, Luzerne
     County, from Shickshinny Water Company and Mocanaqua Water Company, by
     Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne County
     Deed Book 2453 at Page 517.
 
          45. Right-of-way for water pipeline in the Township of Salem, Luzerne
     County, from Shickshinny Water Company and Mocanaqua Water Company, by
     Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne County
     Deed Book 2453 at Page 517.
 
          46. Right-of-way for water pipeline in the Township of Salem, Luzerne
     County, from Shickshinny Water Company and Mocanaqua Water Company, by
     Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne County
     Deed Book 2453 at Page 517.
 
          47. Right-of-way for water pipeline in the Borough of Shickshinny,

     Luzerne County, from Shickshinny Water Company and Mocanaqua Water Company,
     by Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne
     County Deed Book 2453 at Page 517.
 
          48. Right-of-way for water pipeline in the Borough of Shickshinny,
     Luzerne County, from Shickshinny Water Company and Mocanaqua Water Company,
     by Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne
     County Deed Book 2453 at Page 517.
 
          49. Right-of-way for water pipeline in the Township of Salem, Luzerne
     County, from Shickshinny Water Company and Mocanaqua Water Company, by
     Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne County
     Deed Book 2453 at Page 517.
 
          50. Right-of-way for water pipeline in the Township of Salem, Luzerne
     County, from Shickshinny Water Company and Mocanaqua Water Company, by
     Indenture dated April 5, 1993 and recorded April 6, 1993 in Luzerne County
     Deed Book 2453 at Page 517.
 
          51. Right-of-way for water pipeline in the Borough of Exeter, Luzerne
     County, from Wildflower Village, Inc., by Indenture dated April 9, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 885.

                                       25
 
          52. Right-of-way for gas pipeline in the Borough of Kingston, Luzerne
     County, from Carol E. Barney Cresko, by Indenture dated April 15, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 890.
 
          53. Right-of-way for gas pipeline in the Borough of Wyoming, Luzerne
     County, from Charles M. Reilly, et ux, by Indenture dated April 15, 1993
     and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 894.
 
          54. Right-of-way for gas pipeline in the Township of Kingston, Luzerne
     County, from Thomas M. Jacobs, et ux, by Indenture dated April 19, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 823.
 
          55. Right-of-way for gas pipeline in the Borough of Pringle, Luzerne
     County, from Anthony J. Kukosky, et ux, by Indenture dated April 30, 1993
     and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 803.
 
          56. Right-of-way for gas pipeline in the Borough of Kingston, Luzerne
     County, from Jean R. Hughes, by Indenture dated May 4, 1993 and recorded
     August 25, 1993 in Luzerne County Deed Book 2466 at Page 926.
 
          57. Right-of-way for gas pipeline in the Township of Kingston, Luzerne
     County, from Terry Cadwalader, by Indenture dated May 19, 1993 and recorded
     August 25, 1993 in Luzerne County Deed Book 2466 at Page 982.
 
          58. Right-of-way for gas pipeline in the Borough of Kingston, Luzerne
     County, from Dorranceton United Methodist Church of Kingston, by Indenture
     dated May 19, 1993 and recorded August 25, 1993 in Luzerne County Deed Book
     2466 at Page 930.
 

          59. Right-of-way for gas pipeline in the Borough of Forty-Fort,
     Luzerne County, from Edward S. Kopec, et ux, by Indenture dated May 25,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     935.
 
          60. Right-of-way for gas pipeline in the Township of Plains, Luzerne
     County, from Housing Authority of the County of Luzerne, by Indenture dated
     May 25, 1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466
     at Page 939.
 
          61. Right-of-way for gas pipeline in the Township of Hanover, Luzerne
     County, from Maple Hill Cemetery Association, by Indenture dated May 28,

                                       26
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     944.
 
          62. Right-of-way for water pipeline in the Township of Hunlock,
     Township of Union and Borough of Shickshinny, Luzerne County, from
     Pennsylvania Gas and Water Company, Trustee, by Indenture dated June 4,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     798.
 
          63. Right-of-way for gas pipeline in the Borough of Kingston, Luzerne
     County, from Jerome Stone, et ux, by Indenture dated June 17, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 954.
 
          64. Right-of-way for gas pipeline in the Borough of Kingston, Luzerne
     County, from Nellie H. Yenshuski, by Indenture dated June 17, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 959.
 
          65. Right-of-way for gas pipeline in the Township of Kingston, Luzerne
     County, from Hill Brook Corporation, by Indenture dated June 17, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 963.
 
          66. Right-of-way for water pipeline in the Township of Jenkins,
     Luzerne County, from County of Luzerne, by Indenture dated June 17, 1993
     and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 968.
 
          67. Right-of-way for gas pipeline in the Township of Fairview, Luzerne
     County, from Township of Fairview, by Indenture dated June 17, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 949.
 
          68. Right-of-way for water pipeline in the Townships of Jenkins and
     Plains, Luzerne County, from Harry S. Salavantis, by Indenture dated June
     18, 1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at
     Page 973.
 
          69. Right-of-way for gas pipeline in the Borough of Courtdale, Luzerne
     County, from Stephen E. Sincavage, et ux, by Indenture dated June 24, 1993
     and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 978.
 
          70. Right-of-way for gas pipeline in the City of Wilkes-Barre, Luzerne
     County, from Frederick H. Voelker, et ux, by Indenture dated June 25, 1993

     and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 868.

                                       27
 
          71. Right-of-way for gas pipeline in the Township of Wilkes-Barre,
     Luzerne County, from Wickes Lumber Company, by Indenture dated June 25,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     793.
 
          72. Right-of-way for gas pipeline in the City of Nanticoke, Luzerne
     County, from Henry Litchkofski, et ux, et al, by Indenture dated June 28,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     858.
 
          73. Right-of-way for gas pipeline in the City of Nanticoke, Luzerne
     County, from John E. Wilczynski, by Indenture dated June 28, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 865.
 
          74. Right-of-way for gas pipeline in the West Wyoming Borough, Luzerne
     County, from Samuel A. Dimick, et ux, et al, by Indenture dated June 30,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     844.
 
          75. Right-of-way for gas pipeline in the City of Nanticoke, Luzerne
     County, from Joseph Kryzanski, et ux, by Indenture dated June 30, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 850.
 
          76. Right-of-way for gas pipeline in the City of Nanticoke, Luzerne
     County, from Joseph Latze, et ux, by Indenture dated June 30, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 854.
 
          77. Right-of-way for ground bed for cathodic protection in the
     Township of Plains, Luzerne County, from Frank Dominick, et ux, by
     Indenture dated July 1, 1993 and recorded August 25, 1993 in Luzerne County
     Deed Book 2466 at Page 789.
 
          78. Right-of-way for gas pipeline in the Borough of Courtdale, Luzerne
     County, from UGI Utilities, Inc., et al, by Indenture dated July 7, 1993
     and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 839.
 
          79. Right-of-way for water pipeline in the Borough of Sugar Notch,
     Luzerne County, from Robert Kinney, et al, by Indenture dated July 26, 1993
     and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 835.
 
          80. Right-of-way for water pipeline in the Township of Conyngham,
     Luzerne County, from Most Reverend James C. Timlin, Bishop, Trustee for St.
     Mary's Polish Roman Catholic Congregation of the Village of Mocanaqua, by
     Indenture dated July 27, 1993 and recorded August 25, 1993 in Luzerne
     County Deed Book 2466 at Page 898.

                                       28
 
          81. Right-of-way for water pipeline in the Borough of Sugar Notch,
     Luzerne County, from Charles Kinney, et ux, by Indenture dated July 30,

     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     831.
 
          82. Right-of-way for gas pipeline in the Township of Wright, Luzerne
     County, from John D. Moran, et al, by Indenture dated August 5, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 905.
 
          83. Right-of-way for gas pipeline in the Borough of Dallas, Luzerne
     County, from Nicholas Stredny, by Indenture dated August 13, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 909.
 
          84. Right-of-way for gas pipeline in the City of Wilkes-Barre, Luzerne
     County, from United States Postal Service, by Indenture dated August 17,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     913.
 
          85. Right-of-way for gas pipeline in the Borough of West Wyoming,
     Luzerne County, from Bruno Ferretti, et al, by Indenture dated August 18,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     817.
 
          86. Right-of-way for water pipeline in the Borough of West Wyoming,
     Luzerne County, from Bruno Ferretti, et al, by Indenture dated August 18,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     811.
 
          87. Right-of-way for gas pipeline in the Township of Wilkes-Barre,
     Luzerne County, from Joseph Antellocy, et al, by Indenture dated August 19,
     1993 and recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page
     918.
 
          88. Right-of-way for gas pipeline in the City of Wilkes-Barre, Luzerne
     County, from John A. Gulius, et ux, by Indenture dated August 23, 1993 and
     recorded August 25, 1993 in Luzerne County Deed Book 2466 at Page 922.
 
          89. Right-of-way for gas pipeline in the Township of Wilkes-Barre,
     Luzerne County, from Cleveland Brothers Equipment Company, Inc., by
     Indenture dated August 24, 1993 and recorded October 20, 1993 in Luzerne
     County Deed Book 2472 at Page 660.
 
          90. Right-of-way for gas pipeline in the Township of Plains, Luzerne
     County, from Joseph Coccia, et ux, by Indenture dated August 31, 1993 and
     recorded October 20, 1993 in Luzerne County Deed Book 2472 at Page 675.
 
          91. Right-of-way for gas pipeline in the Township of Wilkes-Barre,
     Luzerne County, from Raymond Wojtowicz, by Indenture dated September

                                       29
     27, 1993 and recorded October 20, 1993 in Luzerne County Deed Book 2472 at
     Page 665.
 
          92. Right-of-way for gas pipeline in the Township of Kingston, Luzerne
     County, from Dr. Joseph M. Lombardo, et ux, by Indenture dated October 8,
     1993 and recorded October 20, 1993 in Luzerne County Deed Book 2472 at Page

     670.
 
          93. Right-of-way for gas pipeline in the Township of Lehman, Luzerne
     County, from Maplemoor, Inc., by Indenture dated October 11, 1993 and
     recorded October 20, 1993 in Luzerne County Deed Book 2472 at Page 655.
 
          94. Right-of-way for gas pipeline in the Township of Lehman, Luzerne
     County, from Henry M. Evans, et ux, by Indenture dated October 20, 1993 and
     recorded October 28, 1993 in Luzerne County Deed Book 2473 at Page 542.
 
          95. Right-of-way for gas pipeline in the Borough of Sugar Notch,
     Luzerne County, from Robert L. Jones, et ux, by Indenture dated October 28,
     1993 and recorded October 28, 1993 in Luzerne County Deed Book 2473 at Page
     538.
 
                                       VI
 
     The following right-of-way and/or easements situate in the County of
Lycoming and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from Donald L. Emerick, Sr., by Indenture dated September
     1, 1992 and recorded January 20, 1993 in Lycoming County Deed Book 1999 at
     Page 195.
 
          02. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from Wal-Mart (Stores), Inc., by Indenture dated September
     15, 1992 and recorded January 20, 1993 in Lycoming County Deed Book 1999 at
     Page 198.
 
          03. Right-of-way for gas pipeline in the Township of Old Lycoming,
     Lycoming County, from West End Christian and Missionary Alliance Church, by
     Indenture dated October 31, 1992 and recorded December 11, 1992 in Lycoming
     County Deed Book 1980 at Page 179.
 
          04. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Rodney G. Ramin, et ux, by Indenture dated November
     12, 1992 and recorded December 11, 1992 in Lycoming County Deed Book 1980
     at Page 176.

                                       30
 
          05. Right-of-way for gas pipeline in the City of Williamsport,
     Lycoming County, from Williamsport Area School District, by Indenture dated
     November 17, 1992 and recorded December 11, 1992 in Lycoming County Deed
     Book 1980 at Page 183.
 
          06. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Warrior Run Development Corporation, by Indenture
     dated November 30, 1992 and recorded January 20, 1993 in Lycoming County
     Deed Book 1999 at Page 203.
 
          07. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Robert J. Kinley, by Indenture dated December 3, 1992

     and recorded January 20, 1993 in Lycoming County Deed Book 1999 at Page
     207.
 
          08. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Ellis L. Wettlaufer, Jr., by Indenture dated December
     9, 1992 and recorded January 20, 1993 in Lycoming County Deed Book 1999 at
     Page 210.
 
          09. Right-of-way for gas pipeline in the Borough of South
     Williamsport, Lycoming County, from John W. Eck, et al, by Indenture dated
     December 9, 1992 and recorded January 20, 1993 in Lycoming County Deed Book
     1999 at Page 213.
 
          10. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Donald F. Bower, et ux, by Indenture dated December
     23, 1992 and recorded January 20, 1993 in Lycoming County Deed Book 1999 at
     Page 216.
 
          11. Right-of-way for gas pipeline in the Township of Loyalsock and
     City of Williamsport, Lycoming County, from C. A. Reed, Inc., by Indenture
     dated February 19, 1993 and recorded March 18, 1993 in Lycoming County Deed
     Book 2022 at Page 106.
 
          12. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Industrial Piping Systems, Inc., by Indenture dated
     February 26, 1993 and recorded March 18, 1993 in Lycoming County Deed Book
     2022 at Page 102.
 
          13. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Barbara D. Schramm, by Indenture dated March 18, 1993
     and recorded April 12, 1993 in Lycoming County Deed Book 2032 at Page 157.
 
          14. Right-of-way for gas pipeline in the City of Williamsport,
     Lycoming County, from Julius Kaplan, et al, by Indenture dated March 22,

                                       31
     1993 and recorded April 12, 1993 in Lycoming County Deed Book 2032 at Page
     160.
 
          15. Right-of-way for gas pipeline in the City of Williamsport,
     Lycoming County, from William A. Hodrick, Jr., by Indenture dated March 31,
     1993 and recorded April 12, 1993 in Lycoming County Deed Book 2032 at Page
     164.
 
          16. Right-of-way for gas pipeline in the Township of Clinton, Lycoming
     County, from Laverne E. More, et ux, by Indenture dated April 14, 1993 and
     recorded May 14, 1993 in Lycoming County Deed Book 2052 at Page 016.
 
          17. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Robert G. Shearer, et ux, by Indenture dated June 7,
     1993 and recorded July 6, 1993 in Lycoming County Deed Book 2081 at Page
     241.
 
          18. Right-of-way for gas pipeline in the Borough of Montoursville,

     Lycoming County, from Montoursville Area School District, by Indenture
     dated June 8, 1993 and recorded July 6, 1993 in Lycoming County Deed Book
     2081 at Page 244.
 
          19. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from Williamsport Municipal Airport Authority, by
     Indenture dated June 10, 1993 and recorded July 6, 1993 in Lycoming County
     Deed Book 2081 at Page 248.
 
          20. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Warrior Run Development Corporation, by Indenture
     dated July 1, 1993 and recorded July 6, 1993 in Lycoming County Deed Book
     2081 at Page 184.
 
          21. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Loyalsock Township School District, by Indenture
     dated August 5, 1993 and recorded August 24, 1993 in Lycoming County Deed
     Book 2112 at Page 101.
 
          22. Right-of-way for gas pipeline in the City of Williamsport,
     Lycoming County, from Williamsport Sanitary Authority, by Indenture dated
     August 9, 1993 and recorded August 24, 1993 in Lycoming County Deed Book
     2112 at Page 105.
 
          23. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from Lee A. Viard, by Indenture dated August 19, 1993 and
     recorded August 24, 1993 in Lycoming County Deed Book 2112 at Page 108.

                                       32
 
          24. Right-of-way for gas pipeline in the City of Williamsport,
     Lycoming County, from Industrial Properties Corporation, et al, by
     Indenture dated August 19, 1993 and recorded October 19, 1993 in Lycoming
     County Deed Book 2146 at Page 337.
 
          25. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from Wendy's Old Fashioned Hamburgers of New York, Inc.,
     by Indenture dated August 27, 1993 and recorded October 19, 1993 in
     Lycoming County Deed Book 2146 at Page 341.
 
          26. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Cameo Estates, Inc., by Indenture dated September 21,
     1993 and recorded October 29, 1993 in Lycoming County Deed Book 2153 at
     Page 45.
 
          27. Right-of-way for gas pipeline in the City of Williamsport,
     Lycoming County, from Corporate Property Associates 4, by Indenture dated
     September 23, 1993 and recorded October 19, 1993 in Lycoming County Deed
     Book 2146 at Page 345.
 
          28. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from David J. Eiswerth, et ux, by Indenture dated
     September 24, 1993 and recorded October 19, 1993 in Lycoming County Deed
     Book 2147 at Page 1.

 
          29. Right-of-way for gas pipeline in the City of Williamsport,
     Lycoming County, from Grampian Boulevard Corporation, by Indenture dated
     September 29, 1993 and recorded October 19, 1993 in Lycoming County Deed
     Book 2147 at Page 5.
 
          30. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from Ronald D. Thomas, et ux, by Indenture dated September
     30, 1993 and recorded October 19, 1993 in Lycoming County Deed Book 2147 at
     Page 9.
 
          31. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from William S. Holmes, et ux, by Indenture dated
     September 30, 1993 and recorded October 19, 1993 in Lycoming County Deed
     Book 2147 at Page 12.
 
          32. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from Borough of Montoursville, by Indenture dated October
     4, 1993 and recorded October 19, 1993 in Lycoming County Deed Book 2147 at
     Page 19.
 
          33. Right-of-way for gas pipeline in the Borough of Montoursville,
     Lycoming County, from LC Realty, Inc., by Indenture dated October 14,

                                       33
     1993 and recorded October 19, 1993 in Lycoming County Deed Book 2147 at
     Page 15.
 
          34. Right-of-way for gas pipeline in the Township of Loyalsock,
     Lycoming County, from Richard Caschera, Jr., et ux, by Indenture dated
     October 14, 1993 and recorded October 29, 1993 in Lycoming County Deed Book
     2153 at Page 50.
 
                                      VII
 
     The following right-of-way and/or easements situate in the County of
Montour and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the Borough of Danville, Montour
     County, from John A. Malcolm, Jr., et ux, by Indenture dated December 17,
     1992 and recorded January 20, 1993 in Montour County Record Book 167 at
     Page 545.
 
          02. Right-of-way for gas pipeline in the Borough of Danville, Montour
     County, from Thomas W. Harris, Jr., et ux, by Indenture dated June 29, 1993
     and recorded July 6, 1993 in Montour County Record Book 170 at Page 652.
 
                                      VIII
 
     The following right-of-way and/or easements situate in the County of
Northumberland and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Stephen G. Fassano, et ux, by Indenture dated

     November 5, 1992 and recorded December 11, 1992 in Northumberland County
     Record Book 886 at Page 317.
 
          02. Right-of-way for gas pipeline in the Township of Delaware,
     Northumberland County, from Barry L. Ford, et ux, by Indenture dated
     November 30, 1992 and recorded January 20, 1993 in Northumberland County
     Record Book 891 at Page 556.
 
          03. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Robert F. Roshon, et ux, by Indenture dated
     February 11, 1993 and recorded March 8, 1993 in Northumberland County
     Record Book 896 at Page 745.
 
          04. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Lee D. Hopewell, et al, by Indenture dated

                                       34
     March 8, 1993 and recorded April 12, 1993 in Northumberland County Record
     Book 901 at Page 93.
 
          05. Right-of-way for gas pipeline in the Borough of Turbotville,
     Northumberland County, from Clark's AG Center, Inc., by Indenture dated
     April 6, 1993 and recorded May 14, 1993 in Northumberland County Record
     Book 905 at Page 622.
 
          06. Right-of-way for gas pipeline in the Borough of Turbotville,
     Northumberland County, from Clark's AG Center, Inc., by Indenture dated
     April 6, 1993 and recorded August 26, 1993 in Northumberland County Record
     Book 922 at Page 212.
 
          07. Right-of-way for gas pipeline in the Borough of Turbotville,
     Northumberland County, from Turbotville Veterans' Home Association, by
     Indenture dated April 14, 1993 and recorded May 14, 1993 in Northumberland
     County Record Book 905 at Page 618.
 
          08. Right-of-way for gas pipeline in the City of Sunbury,
     Northumberland County, from Sunbury Community Hospital, by Indenture dated
     May 5, 1993 and recorded May 14, 1993 in Northumberland County Record Book
     905 at Page 626.
 
          09. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Doris T. McDowell, et al, by Indenture dated
     May 14, 1993 and recorded July 6, 1993 in Northumberland County Record Book
     914 at Page 142.
 
          10. Right-of-way for gas pipeline in the Borough of Turbotville,
     Northumberland County, from Consolidated Rail Corporation, by Indenture
     dated April 21, 1993 and recorded August 26, 1993 in Northumberland County
     Record Book 922 at Page 216.
 
          11. Right-of-way for gas pipeline in the Borough of Turbotville,
     Northumberland County, from Allen G. Stamm, et ux, by Indenture dated July
     28, 1993 and recorded August 26, 1993 in Northumberland County Record Book
     922 at Page 225.

 
          12. Right-of-way for gas pipeline in the Borough of Milton,
     Northumberland County, from Randall D. Kramm, et ux, by Indenture dated
     August 4, 1993 and recorded August 26, 1993 in Northumberland County Record
     Book 922 at Page 228.
 
          13. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Daniel P. Stuck, et al, by Indenture dated
     September 13, 1993 and recorded October 19, 1993 in Northumberland County
     Record Book 930 at Page 374.

                                       35
 
          14. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Arthur J. Stuck, et ux, by Indenture dated
     September 13, 1993 and recorded October 19, 1993 in Northumberland County
     Record Book 930 at Page 377.
 
          15. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Dennis Tatar, et ux, by Indenture dated
     September 13, 1993 and recorded October 19, 1993 in Northumberland County
     Record Book 930 at Page 380.
 
          16. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Thomas D. Stuck, et ux, by Indenture dated
     September 13, 1993 and recorded October 19, 1993 in Northumberland County
     Record Book 930 at Page 383.
 
          17. Right-of-way for gas pipeline in the Township of Delaware,
     Northumberland County, from Layman Larve Phillips, et ux, by Indenture
     dated September 14, 1993 and recorded October 19, 1993 in Northumberland
     County Record Book 930 at Page 386.
 
          18. Right-of-way for gas pipeline in the Township of Upper Augusta,
     Northumberland County, from George F. Keller, et ux, by Indenture dated
     October 11, 1993 and recorded October 19, 1993 in Northumberland County
     Record Book 930 at Page 389.
 
          19. Right-of-way for gas regulator station in the Borough of
     Turbotville, Northumberland County, from Clark's AG Center, Inc., by
     Indenture dated October 19, 1993 and recorded October 29, 1993 in
     Northumberland County Record Book 932 at Page 145.
 
          20. Right-of-way for gas pipeline in the Borough of Turbotville,
     Northumberland County, from Turbotville Development Corp., by Indenture
     dated October 27, 1993 and recorded October 29, 1993 in Northumberland
     County Record Book 932 at Page 141.
 
          21. Right-of-way for gas pipeline in the Township of Point,
     Northumberland County, from Robert E. Weaver, by Indenture dated October
     27, 1993 and recorded October 29, 1993 in Northumberland County Record Book
     932 at Page 149.
 
          22. Right-of-way for gas pipeline in the Township of Point,

     Northumberland County, from Northumberland Legion Home Association, by
     Indenture dated October 27, 1993 and recorded October 29, 1993 in
     Northumberland County Record Book 932 at Page 152.
 
          23. Right-of-way for gas pipeline in the Borough of Northumberland,
     Northumberland County, from Paul R. Gemberling, et ux, by Indenture

                                       36
     dated October 29, 1993 and recorded October 29, 1993 in Northumberland
     County Record Book 932 at Page 156.
 
                                       IX
 
     The following right-of-way and/or easements situate in the County of Snyder
and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the Township of Middle Creek,
     Snyder County, from Vince L. Shrawder, et al, by Indenture dated November
     30, 1992 and recorded January 20, 1993 in Snyder County Record Book 304 at
     Page 805.
 
          02. Right-of-way for gas pipeline in the Township of Monroe, Snyder
     County, from Paul C. Stine, by Indenture dated April 7, 1993 and recorded
     May 14, 1993 in Snyder County Record Book 310 at Page 560.
 
          03. Right-of-way for gas pipeline in the Township of Monroe, Snyder
     County, from Susquehanna Valley Mall Associates, by Indenture dated July
     23, 1993 and recorded August 24, 1993 in Snyder County Record Book 318 at
     Page 268.
 
          04. Right-of-way for gas pipeline in the Borough of Shamokin Dam,
     Snyder County, from Nancy H. Pheasant, by Indenture dated August 4, 1993
     and recorded August 24, 1993 in Snyder County Record Book 318 at Page 271.
 
          05. Right-of-way for gas pipeline in the Borough of Shamokin Dam,
     Snyder County, from Warren M. Humphrey, et ux, by Indenture dated August 5,
     1993 and recorded August 24, 1993 in Snyder County Record Book 318 at Page
     274.
 
          06. Right-of-way for gas pipeline in the Township of Penn, Snyder
     County, from Selinsgrove Post No. 6631, Veterans' of Foreign Wars of the
     United States, Inc., by Indenture dated September 22, 1993 and recorded
     October 19, 1993 in Snyder County Record Book 321 at Page 913.
 
                                       X
 
     The following right-of-way and/or easements situate in the County of Union
and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the Township of Buffalo, Union
     County, from Noah A. Yoder, et ux, by Indenture dated November 5, 1992 and
     recorded December 11, 1992 in Union County Record Book 281 at Page 467.

                                       37

 
          02. Right-of-way for gas pipeline in the Township of White Deer, Union
     County, from White Deer Township Volunteer Fire Company, by Indenture dated
     September 30, 1993 and recorded October 19, 1993 in Union County Record
     Book 325 at Page 139.
 
          03. Right-of-way for gas pipeline in the Township of White Deer, Union
     County, from Revival Tabernacle, by Indenture dated October 11, 1993 and
     recorded October 29, 1993 in Union County Record Book 327 at Page 127.
 
                                       XI
 
     The following right-of-way and/or easements situate in the County of
Wyoming and Commonwealth of Pennsylvania, to wit:
 
          01. Right-of-way for gas pipeline in the Township of Washington,
     Wyoming County, from David R. Evans, et ux, by Indenture dated January 22,
     1993 and recorded February 8, 1993 in Wyoming County Record Book 294 at
     Page 616.
 
          02. Right-of-way for gas pipeline in the Township of Washington,
     Wyoming County, from William S. Miner, et ux, by Indenture dated March 29,
     1993 and recorded April 8, 1993 in Wyoming County Record Book 296 at Page
     666.
 
          03. Right-of-way for gas pipeline in the Township of Washington,
     Wyoming County, from William S. Miner, et ux, by Indenture dated July 29,
     1993 and recorded August 27, 1993 in Wyoming County Record Book 303 at Page
     463.
 
     SAVING AND EXCEPTING, HOWEVER, FROM THE PROPERTY DESCRIBED OR REFERRED TO
ABOVE, all property which is reserved or excepted from the lien and operation of
the Indenture by virtue of the exceptions contained in the Granting Clauses
thereof.
 
     TO HAVE AND TO HOLD the same, unto the Trustee and its successors and
assigns forever;
 
     SUBJECT, HOWEVER, to permitted encumbrances as defined in the Original
Indenture and to any lien thereon existing, and to any liens for unpaid portions
of the purchase money placed thereon, at the time of acquisition, and also
subject to the provisions of Article 12 of the Original Indenture;
 
     IN TRUST, NEVERTHELESS, upon the terms and trusts set forth in the
Indenture.
 
     PROVIDED, HOWEVER, and these presents are upon the condition that if the
Company, its successors or assigns, shall pay or cause to be paid unto the
holders

                                       38
of bonds issued and to be issued under the Indenture the principal and interest,
and premium, if any, due or to become due in respect thereof at the times and in
the manner stipulated therein and shall keep, perform and observe all and

singular the covenants and promises in said bonds and in the Indenture expressed
to be kept, performed and observed by or on the part of the Company, then the
Indenture and the estates and rights hereby granted shall cease, determine and
be void, otherwise to be and remain in full force and effect.
 
     IT IS HEREBY COVENANTED, DECLARED AND AGREED by and between the parties
hereto that the Company will protect and make effective the lien intended to be
created by the Indenture with respect to all of the properties hereinabove
described and that all bonds are to be issued, authenticated, delivered and
held, and that all property subject or to become subject to the Indenture is to
be held, subject to the further covenants, conditions, uses and trusts set forth
in the Original Indenture as heretofore supplemented, and as supplemented by
this Twenty-Eighth Supplemental Indenture, in all respects as if said property
was specifically described in the Granting Clauses of the Original Indenture;
and the Company, for itself and its successors, doth hereby covenant and agree
to and with the Trustee, for the benefit of those who hold said bonds as
follows:
 
                                   ARTICLE 1.
 
                   CREATION OF BONDS OF THE TWENTIETH SERIES.
 
     Section 1.01.  There is hereby created a new series of bonds to be issued
under the Original Indenture which shall be designated First Mortgage Bonds
6.05% Series due 2019. Without limiting the rights of the holders of the bonds
under Section 2.11 of the Original Indenture, the aggregate principal amount of
bonds of the Twentieth Series shall be limited to $19,000,000. All bonds of the
Twentieth Series shall mature January 1, 2019, and shall bear interest at the
rate of 6.05% per annum, payable semi-annually on the first day of July and
first day of January in each year, commencing July 1, 1994; provided, however,
that the interest payable on the bonds of the Twentieth Series shall be reduced
to the extent that other moneys then on deposit with PNC Bank, National
Association, as trustee or any successor trustee (the 'IDA Trustee') under the
Trust Indenture dated as of December 1, 1993 (the 'Trust Indenture') from the
Luzerne County Industrial Development Authority (the 'Authority') to the IDA
Trustee are available for the purpose of paying interest on the bonds of the
Twentieth Series and a credit in respect thereof has been granted pursuant to
the Trust Indenture. The Company shall notify the Trustee no later than sixteen
(16) days prior to any interest payment date on which the amount of interest
payable on the bonds of the Twentieth Series shall be reduced pursuant to the
preceding sentence of the amount by which the interest payable on the bonds of
the Twentieth Series shall be reduced on such interest payment date. The
principal of and interest on each

                                       39
such bond shall be payable at the office or agency of the Company in the Borough
of Manhattan, The City of New York, and both principal and interest shall be
payable in any coin or currency of the United States of America which at the
time of payment shall be legal tender for the payment of public and private
debts.
 
     The bonds of the Twentieth Series shall be dated the date of their
authentication and shall bear interest from the interest payment date next
preceding the date of authentication of the bond (except that if the date of

authentication of any such bond is an interest payment date for bonds of the
Twentieth Series to which interest has been paid it shall bear interest from the
date of authentication of such bond, and except that if any bond of the
Twentieth Series is authenticated prior to the first interest payment date for
bonds of the Twentieth Series it shall bear interest from December 1, 1993). So
long as there is no existing default in the payment of interest on the bonds of
the Twentieth Series, the person in whose name any bond of the Twentieth Series
is registered at the close of business on the record date with respect to any
interest payment date (the term 'record date' as used with respect to an
interest payment date shall mean the fifteenth day of June or the fifteenth day
of December next preceding the interest payment date whether or not such
fifteenth day is a business day) shall be entitled to receive the interest
payable on such interest payment date notwithstanding any transfer or exchange
of the bond of the Twentieth Series subsequent to the record date and on or
prior to the interest payment date, except if, and to the extent, the Company
shall default in the payment of the interest due on such interest payment date,
the default interest shall be paid to the person in whose name the bond of the
Twentieth Series is registered five (5) days before the date of payment of the
defaulted interest.
 
     Bonds of the Twentieth Series shall be issued as fully registered bonds
without coupons, in such denominations as authorized by the Board of Directors.
 
     Bonds of the Twentieth Series shall be registrable and interchangeable at
the office or agency of the Company in the Borough of Manhattan, The City of New
York, in the manner and upon the terms set forth in Section 2.05 of the Original
Indenture, upon payment of charges as required or permitted by the provisions of
Section 2.08 of the Original Indenture as amended.
 
     The bonds of the Twentieth Series shall be redeemable upon not less than
thirty (30) nor more than sixty (60) days' prior notice, in whole or in part,
pursuant to the requirements of the Indenture, upon the terms and conditions
hereinafter specified in Section 1.02 hereof.
 
     Section 1.02.  (i) The bonds of the Twentieth Series are subject to
mandatory redemption, in whole or in part, upon any redemption of the Luzerne
County Industrial Development Authority Exempt Facilities Revenue Refunding

                                       40
Bonds, 1993 Series A (Pennsylvania Gas and Water Company Project) due January 1,
2019 (the '1993 Series A Bonds'). The principal amount of bonds of the Twentieth
Series to be redeemed upon any redemption of the 1993 Series A Bonds shall be
equal to 100% of the principal amount of 1993 Series A Bonds which are to be
redeemed. The Company shall notify the Trustee of any redemption not less than
forty-five (45) nor more than sixty (60) days prior to the date fixed for
redemption of the bonds of the Twentieth Series of the principal amount of 1993
Series A Bonds which are to be redeemed unless the Company shall give notice of
such redemption pursuant to Section 5.03 of the Original Indenture. The Company
shall provide the Trustee with a copy of any notice of redemption given pursuant
to Section 5.03 of the Original Indenture within two (2) business days of such
notice. The redemption price of the bonds of the Twentieth Series which are
redeemed under the circumstances set forth in this subsection (i) shall be equal
to 100% of the principal amount of the bonds of the Twentieth Series to be
redeemed plus interest accrued to the date fixed for redemption except (a) in

the case of bonds of the Twentieth Series which are redeemed upon a redemption
of the 1993 Series A Bonds at the option of the Authority (other than in an
'Extraordinary Optional Redemption,' as defined in the Trust Indenture) upon the
direction of the Company (an 'Optional IDA Redemption') which occurs between
January 1, 2004 and December 31, 2004, inclusive, the redemption price shall be
equal to 102% of the principal amount of the bonds of the Twentieth Series to be
redeemed plus interest accrued to the date fixed for redemption and (ii) in the
case of bonds of the Twentieth Series which are redeemed upon an Optional IDA
Redemption which occurs between January 1, 2005 and December 31, 2005,
inclusive, the redemption price shall be equal to 101% of the principal amount
of the bonds of the Twentieth Series to be redeemed plus interest accrued to the
date fixed for redemption.
 
     (ii) The bonds of the Twentieth Series are subject to mandatory redemption,
in whole, if the IDA Trustee declares the 1993 Series A Bonds to be immediately
due and payable under Section 9.02 of the Trust Indenture. The Company shall
notify the Trustee of such redemption not less than forty-five (45) nor more
than sixty (60) days prior to the date fixed for such redemption of the bonds of
the Twentieth Series unless the Company shall give notice of such redemption
pursuant to Section 5.03 of the Original Indenture. The Company shall provide
the Trustee with a copy of any notice of redemption given pursuant to Section
5.03 of the Original Indenture within two (2) business days of such notice. The
redemption price of the bonds of the Twentieth Series which are redeemed under
the circumstances set forth in this subsection (ii) shall be equal to 100% of
the principal amount of the bonds of the Twentieth Series to be redeemed plus
interest accrued to the date fixed for redemption.
 
     (iii) The bonds of the Twentieth Series are subject to mandatory
redemption, in whole or in part (but if in part on a pro-rata basis with bonds
of all other series

                                       41
then outstanding under the Indenture), pursuant to the provisions of Section
8.13 of the Indenture. The redemption price of the bonds of the Twentieth Series
which are redeemed under the circumstances set forth in this subsection (iii)
shall be equal to 100% of the principal amount of the bonds of the Twentieth
Series to be redeemed plus interest accrued to the date fixed for redemption.
 
     Section 1.03.  The holder of each and every bond of the Twentieth Series
hereby agrees to accept payment thereof prior to maturity on the terms and
conditions in Section 1.02 hereof and in Section 8.13 of the Indenture.
 
                                   ARTICLE 2.
 
               NO SINKING FUND FOR BONDS OF THE TWENTIETH SERIES.
 
     Bonds of the Twentieth Series will not be entitled to the benefit of a
Sinking Fund.
 
                                   ARTICLE 3.
 
                   ISSUANCE OF BONDS OF THE TWENTIETH SERIES.
 
     Bonds of the Twentieth Series may be executed, authenticated and delivered

from time to time as provided or permitted by the provisions of Article 3 of the
Original Indenture and the provisions of this Twenty-Eighth Supplemental
Indenture.
 
                                   ARTICLE 4.
 
                                 MISCELLANEOUS.
 
     Section 4.01.  Sections 4.10, 4.11 and 8.13 of the Original Indenture, as
amended by Section 4.01 of Article 4 of the Fourth, Ninth, Tenth, Twelfth,
Fourteenth, Fifteenth, Sixteenth, Seventeenth, Eighteenth, Nineteenth,
Twentieth, Twenty-First, Twenty-Second, Twenty-Third, Twenty-Fourth,
Twenty-Fifth, Twenty-Sixth and Twenty-Seventh Supplemental Indentures, are
hereby further amended by this Twenty-Eighth Supplemental Indenture by inserting
in each such section the words 'or bonds of the 6.05% Series due 2019'
immediately after the words 'bonds of the 2 7/8% Series due 1976 or bonds of the
3 1/2% Series due 1982 or bonds of the 4 7/8% Series due 1987 or bonds of the
4 3/4% Series due 1983 or bonds of the 5 1/2% Series due 1985 or bonds of the 5%
Series due 1986 or bonds of the 4 5/8% Series due 1988 or bonds of the 5 7/8%
Series due 1991 or bonds of the 6 7/8% Series due 1992 or bonds of the 10%
Series due 1995 or bonds of the 8% Series due 1997 or bonds of the 9 1/4% Series
due 1996 or bonds of the 9% Series due 1991 or bonds of the 9.23% Series due
1999 or bonds of the 9.34% Series due 2019 or bonds of the 9.57% Series due 1996
or bonds of the

                                       42
7.20% Series due 2017 or bonds of the 8.375% Series due 2002 or bonds of the
7.125% Series due 2022' each time such last mentioned words occur therein.
 
     Section 4.02.  The Trustee accepts the trusts hereby declared and provided
and agrees to perform the same upon the terms and conditions in the Original
Indenture and in this Twenty-Eighth Supplemental Indenture set forth. The
Trustee shall not be responsible in any manner whatsoever for or in respect of
the validity or sufficiency of this Twenty-Eighth Supplemental Indenture or the
due execution hereof by the Company, or for or in respect of the recitals
contained herein, all of which recitals are made by the Company solely.
 
     The Original Indenture as heretofore supplemented by twenty-seven
supplemental indentures and as supplemented by this Twenty-Eighth Supplemental
Indenture is in all respects ratified and confirmed, and the Original Indenture,
together with the twenty-eight indentures supplemental thereto, shall be read,
taken and construed as one and the same indenture.
 
     Section 4.03.  This Twenty-Eighth Supplemental Indenture may be executed in
any number of counterparts, and all said counterparts executed and delivered,
each as an original, shall constitute but one and the same instrument.
 
     Pennsylvania Gas and Water Company does hereby constitute and appoint
Thomas J. Ward to be its attorney for it, and in its name and as and for its
corporate act and deed to acknowledge this Twenty-Eighth Supplemental Indenture
before any person having authority by the laws of the Commonwealth of
Pennsylvania to take such acknowledgment, to the intent that the same may be
duly recorded, and Morgan Guaranty Trust Company of New York does hereby
constitute and appoint Catherine F. Donohue to be its attorney for it, and in

its name and as and for its corporate act and deed to acknowledge this Twenty-
Eighth Supplemental Indenture before any person having authority by the laws of
the State of New York to take such acknowledgment, to the intent that the same
may be duly recorded.

                                       44
 
     IN WITNESS WHEREOF, said Pennsylvania Gas and Water Company and said Morgan
Guaranty Trust Company of New York have caused this Supplemental Indenture to be
signed in their respective corporate names, and their respective corporate seals
to be hereunto affixed and attested by their respective officers thereunto duly
authorized, all as of the day and year first above written.
 
                                        PENNSYLVANIA GAS AND WATER COMPANY
                                        By:________/s/_JOHN F. KELL, JR.________
                                              Name: John F. Kell, Jr.
                                               Title: Vice President, Finance
 
[CORPORATE SEAL]
Attest:
        /s/_THOMAS J. WARD______
              Secretary
 
                                        MORGAN GUARANTY TRUST COMPANY
                                         OF NEW YORK, AS TRUSTEE
 
                                        By:__________/s/_HELEN G. CHIN__________
                                              Name: Helen G. Chin
                                               Title: Vice President
 
[CORPORATE SEAL]
Attest:
    /s/_CATHERINE F. DONOHUE____
        Assistant Secretary
 
COMMONWEALTH OF PENNSYLVANIA
ss.:
COUNTY OF LUZERNE
 
                                    }

                                       45
 
     BE IT REMEMBERED that on the 15th day of December, A.D., 1993, before me,
JoAnne McHale, a Notary Public in and for said County and said Commonwealth,
commissioned for and residing in the County of Luzerne, personally came Thomas
J. Ward, who, being duly sworn according to law, doth depose and say that he was
personally present and did see the common or corporate seal of the above-named
PENNSYLVANIA GAS AND WATER COMPANY affixed to the foregoing Supplemental
Indenture; that the seal so affixed is the common or corporate seal of said
PENNSYLVANIA GAS AND WATER COMPANY and was so affixed by authority of said
corporation as the act and deed thereof; that the above-named John F. Kell, Jr.
is the Vice President, Finance of said corporation and did sign the said
Supplemental Indenture as such in the presence of this deponent; that this

deponent is the Secretary of the said corporation and that the name of this
deponent, above signed in attestation of the due execution of the said
Supplemental Indenture, is in this deponent's own proper handwriting.
 
            /s/_THOMAS J. WARD__________________________________________________
                                                     Thomas J. Ward
 
        [NOTARIAL SEAL]
 Sworn and subscribed before me
  the day and year aforesaid.
        /s/_JOANNE MCHALE_______
         Notary Public
 
         NOTARIAL SEAL
  JOANNE MCHALE, NOTARY PUBLIC
  WILKES-BARRE, LUZERNE COUNTY
 MY COMMISSION EXPIRES SEPT. 6,
              1994

                                       46
 
COMMONWEALTH OF PENNSYLVANIA
ss.:
COUNTY OF LUZERNE
 
                                    }
 
     I HEREBY CERTIFY that on this 15th day of December, A.D., 1993, before me,
JoAnne McHale, a Notary Public in and for said County and said Commonwealth,
commissioned for and residing in the County of Luzerne, personally appeared
Thomas J. Ward, the attorney named in the foregoing Supplemental Indenture, and
he, by virtue and in pursuance of the authority therein conferred upon him,
acknowledged said Supplemental Indenture to be the act and deed of the said
PENNSYLVANIA GAS AND WATER COMPANY.
 
     Witness my hand and notarial seal the day and year aforesaid.
 
            /s/_JOANNE MCHALE___________________________________________________
                                                     Notary Public
 
                                                     NOTARIAL SEAL
                                              JOANNE MCHALE, NOTARY PUBLIC
                                              WILKES-BARRE, LUZERNE COUNTY
                                          MY COMMISSION EXPIRES SEPT. 6, 1994
 
[NOTARIAL SEAL]

                                       47
 
STATE OF NEW YORK
ss.:
COUNTY OF NEW YORK
 
                        }

 
     BE IT REMEMBERED that on the 14th day of December, A.D., 1993, before me,
Alison M. Levchuck, a Notary Public in and for said County and State,
commissioned for the County of New York, personally came Catherine F. Donohue
who, being duly sworn according to law, doth depose and say that she was
personally present and did see the common or corporate seal of the above-named
MORGAN GUARANTY TRUST COMPANY OF NEW YORK affixed to the foregoing Supplemental
Indenture; that the seal so affixed is the common or corporate seal of said
MORGAN GUARANTY TRUST COMPANY OF NEW YORK and was so affixed by authority of
said corporation as the act and deed hereof; that the above-named Helen G. Chin
is a Vice President of said corporation and did sign the said Supplemental
Indenture as such in the presence of this deponent; that this deponent is an
Assistant Secretary of said corporation and that the name of this deponent,
above signed in attestation of the due execution of the said Supplemental
Indenture, is in this deponent's own proper handwriting.
 
         /s/_CATHERINE F. DONOHUE_______________________________________________
                                                  Catherine F. Donohue
 
 Sworn and subscribed before me
  the day and year aforesaid.
 
                                                    [NOTARIAL SEAL]
 
     /s/_ALISON M. LEVCHUCK_____
         Notary Public
 
       ALISON M. LEVCHUCK
Notary Public, State of New York
          No. 4997425
   Qualified in Nassau County
Commission Expires June 8, 1994

                                       48
 
STATE OF NEW YORK
ss.:
COUNTY OF NEW YORK
 
                        }
 
     I HEREBY CERTIFY that on this 14th day of December, A.D., 1993, before me,
Alison M. Levchuck, a Notary Public in and for said County and State,
commissioned for the County of New York, personally appeared Catherine F.
Donohue, the attorney named in the foregoing Supplemental Indenture, and she, by
virtue and in pursuance of the authority therein conferred upon her,
acknowledged said Supplemental Indenture to be the act and deed of the said
MORGAN GUARANTY TRUST COMPANY OF NEW YORK.
 
     Witness my hand and notarial seal the day and year aforesaid.
 
          /s/_ALISON M. LEVCHUCK________________________________________________
                                                     Notary Public
 

                                                   ALISON M. LEVCHUCK
                                            Notary Public, State of New York
                                                      No. 4997425
                                               Qualified in Nassau County
                                            Commission Expires June 8, 1994
 
        [NOTARIAL SEAL]
 
                            CERTIFICATE OF RESIDENCE
 
     MORGAN GUARANTY TRUST COMPANY OF NEW YORK hereby certifies that its precise
name and address as Trustee hereunder are: MORGAN GUARANTY TRUST COMPANY OF NEW
YORK, 60 Wall Street, New York, New York 10260.
 
                                        By:__________/s/_HELEN G. CHIN__________
                                              Name: Helen G. Chin
                                               Title: Vice President

     THE BOND EVIDENCED BY THIS CERTIFICATE HAS BEEN ISSUED IN A PRIVATE
TRANSACTION, HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR REGISTERED OR QUALIFIED UNDER THE SECURITIES OR BLUE SKY LAWS OF ANY
STATE AND MAY NOT BE OFFERED, TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THAT ACT, SUCH LAWS AND THE
RULES AND REGULATIONS PROMULGATED THEREUNDER.
 
                       PENNSYLVANIA GAS AND WATER COMPANY
             (Formerly Scranton-Spring Brook Water Service Company)
                   First Mortgage Bond 6.05% Series due 2019
 
No. 001                                                              $19,000,000
 
     PENNSYLVANIA GAS AND WATER COMPANY (formerly Scranton-Spring Brook Water
Service Company), a corporation organized and existing under the laws of the
Commonwealth of Pennsylvania (hereinafter sometimes called the 'Company'), for
value received, promises to pay to PNC Bank, National Association, as trustee
under the Trust Indenture dated as of December 1, 1993 from the Luzerne County
Industrial Development Authority (the 'Authority') to PNC Bank, National
Association, as trustee (the 'Trust Indenture') or registered assigns, on
January 1, 2019 (unless this bond shall have been called for previous redemption
and provision made for the payment of the redemption price thereof), Nineteen
Million Dollars at the Company's office or agency in the Borough of Manhattan,
The City of New York, and, except as otherwise set forth below, semi-annually on
the first day of July and the first day of January in each year commencing July
1, 1994, to pay interest thereon, at said office or agency, at the rate of 6.05%
per annum from the interest payment date to which interest has been paid next
preceding the date of authentication of this bond (except that if the date of
authentication of this bond is an interest payment date for bonds of this series
to which interest has been paid it shall bear interest from the date of
authentication of this bond, and except that if this bond be authenticated prior
to the first interest payment date for bonds of this series, it shall bear
interest from December 1, 1993), until the Company's obligation with respect to
such principal sum shall be discharged; provided that, so long as there is no
existing default in the payment of interest, and except for the payment of
defaulted interest, the interest payable on any July 1 or January 1 will be paid

to the person in whose name this bond was registered at the close of business on
the fifteenth day of June or the fifteenth day of December next preceding such
interest payment date; and further provided that the interest payable on the
bonds of this series shall be reduced to the extent that other moneys then on
deposit with PNC Bank, National Association, or any successor trustee (the 'IDA
Trustee') are available for the purpose of paying interest on the bonds of this
series and a credit in respect thereof has been granted pursuant to the Trust
Indenture. The principal of, premium if any, and the interest on this bond shall
be payable in any coin or

                                       2
currency of the United States of America which at the time of payment shall be
legal tender for the payment of public and private debts.
 
     This bond is one of an issue of bonds of the Company, known as its First
Mortgage Bonds, issued and to be issued in one or more series under, and equally
and ratably secured (except as any sinking, amortization, improvement or other
fund, established in accordance with the provisions of the indenture hereinafter
mentioned, may afford additional security for the bonds of any particular
series) by, a certain mortgage and deed of trust, dated as of March 15, 1946
(hereinafter called the 'Original Indenture'), and by twenty-eight indentures
supplemental thereto (of which, the Seventeenth Supplemental Indenture, dated as
of October 15, 1967, the Eighteenth Supplemental Indenture, dated as of May 1,
1970, and the Twentieth Supplemental Indenture, dated as of March 1, 1976,
amended certain provisions of the Original Indenture) (said Original Indenture
and all said indentures supplemental thereto being hereinafter collectively
called the 'Indenture'), made by the Company to Guaranty Trust Company of New
York and, after the change of name of Guaranty Trust Company of New York to
Morgan Guaranty Trust Company of New York, to Morgan Guaranty Trust Company of
New York, as Trustee (hereinafter called the 'Trustee'), to which Indenture (and
to all additional indentures supplemental thereto) reference is hereby made for
a description of the property mortgaged, the nature and extent of the security,
the rights and limitations of rights of the Company, the Trustee, and the
holders of said bonds under the Indenture, and the terms and conditions upon
which said bonds are secured, to all of the provisions of which Indenture and of
all such additional supplemental indentures in respect of such security,
including the provisions of the Indenture permitting the issue of bonds of any
series in respect of property which, under the restrictions and limitations
therein specified, may be subject to liens prior to the lien of the Indenture,
the holder, by accepting this bond, assents. To the extent permitted by and as
provided in the Indenture, the rights and obligations of the Company and of the
holders of said bonds (including those pertaining to any sinking or other fund)
may be changed and modified, with the consent of the Company, by the holders of
at least 75% in aggregate principal amount of the bonds then outstanding (or, if
one or more, but less than all, series of bonds are affected, by the holders of
at least 75% in aggregate principal amount of outstanding bonds of such one or
more series so affected), such percentage being determined as provided in the
Indenture; provided, however, that without the consent of the holder hereof no
such modification or alteration shall be made which will extend the time of
payment of the principal of, premium, if any, or the interest on this bond or
reduce the principal amount hereof, or premium, if any, or the rate of interest
hereon or effect any other modification of the terms of payment of such
principal or interest or will permit the creation of any lien ranking prior to
or on a parity with the lien of the Indenture on any of the mortgaged property,

or will

                                       3
deprive any non-assenting holder of this bond of a lien upon the mortgaged
property for the security of this bond, or will reduce the percentage of bonds
required for the aforesaid action under the Indenture and provided further that,
as provided in Section 4.02 of the Twentieth Supplemental Indenture, when all
bonds of all series issued prior to January 1, 1976, shall cease to be
outstanding, each reference to '75%' in this sentence shall become '60%.' This
bond is one of a series of bonds designated as the First Mortgage Bonds 6.05%
Series due 2019 of the Company.
 
     The bonds of this series are subject to redemption upon not less than
thirty (30) nor more than sixty (60) days' prior notice, in whole or in part,
under the circumstances set forth in paragraphs (A), (B) and (C), below.
 
     (A) The bonds of this series are subject to mandatory redemption, in whole
or in part, upon any redemption of the Luzerne County Industrial Development
Authority Exempt Facilities Revenue Refunding Bonds, 1993 Series A (Pennsylvania
Gas and Water Company Project) due January 1, 2019 (the '1993 Series A Bonds').
The principal amount of bonds of this series to be redeemed upon any redemption
of the 1993 Series A Bonds shall be equal to 100% of the principal amount of
1993 Series A Bonds which are to be redeemed. The redemption price of the bonds
of this series which are redeemed under the circumstances set forth in this
paragraph (A) shall be equal to 100% of the principal amount of the bonds of
this series to be redeemed plus interest accrued to the date fixed for
redemption except (i) in the case of bonds of this series which are redeemed
upon a redemption of the 1993 Series A Bonds at the option of the Authority
(other than in an 'Extraordinary Optional Redemption,' as defined in the Trust
Indenture) upon the direction of the Company (an 'Optional IDA Redemption')
which occurs between January 1, 2004 and December 31, 2004, inclusive, the
redemption price shall be equal to 102% of the principal amount of the bonds of
this series to be redeemed plus interest accrued to the date fixed for
redemption and (ii) in the case of bonds of this series which are redeemed upon
an Optional IDA Redemption which occurs between January 1, 2005 and December 31,
2005, inclusive, the redemption price shall be equal to 101% of the principal
amount of the bonds of this series to be redeemed plus interest accrued to the
date fixed for redemption.
 
     (B) The bonds of this series are subject to mandatory redemption, in whole,
if the IDA Trustee declares the 1993 Series A Bonds to be immediately due and
payable under Section 9.02 of the Trust Indenture. The redemption price of the
bonds of this series which are redeemed under the circumstances set forth in
this paragraph (B) shall be equal to 100% of the principal amount of the bonds
of this series to be redeemed plus interest accrued to the date fixed for
redemption.
 
     (C) The bonds of this series are subject to mandatory redemption, in whole
or in part (but if in part on a pro rata basis with bonds of all other series
then

                                       4
outstanding under the Indenture), pursuant to the provisions of Section 8.13 of
the Indenture. The redemption price of the bonds of this series which are

redeemed under the circumstances set forth in this paragraph (C) shall be equal
to 100% of the principal amount of the bonds of this series to be redeemed plus
interest accrued to the date fixed for redemption.
 
     If this bond shall be called for redemption, and payment of the redemption
price shall be duly provided by the Company as specified in the Indenture,
interest shall cease to accrue hereon from and after the date of redemption
fixed in the notice thereof.
 
     The principal of this bond may be declared or may become due prior to the
maturity date hereinbefore named, on the conditions, in the manner and at the
times set forth in the Indenture, upon the happening of a default as therein
defined.
 
     This bond is transferable by the registered owner hereof in person or by
his duly authorized attorney at the office or agency of the Company in the
Borough of Manhattan, The City of New York, upon surrender and cancellation of
this bond, and thereupon a new bond or bonds of the same series and maturity,
for a like aggregate principal amount, will be issued to the transferee in
exchange therefor, as provided in the Indenture. The Company and the Trustee and
any registrar and any paying agent may deem and treat the person in whose name
this bond is registered as the absolute owner hereof for the purpose of
receiving payment and for all other purposes.
 
     This bond, alone or with other bonds of the same series and maturity, may
in like manner be exchanged at such office or agency for one or more new bonds
of the same series and maturity of the same aggregate principal amount. Upon
each such transfer or exchange the Company may require the payment of charges as
prescribed in the Indenture.
 
     No recourse under or upon any covenant or obligation of the Indenture, or
of any bonds thereby secured, or for any claim based thereon, or otherwise in
any manner in respect thereof, shall be had against any incorporator, subscriber
to the capital stock, stockholder, officer or director, as such, whether former,
present or future, of the Company or any successor corporation, either directly,
or indirectly through the Company or the Trustee, by the enforcement of any
subscription to capital stock, assessment or otherwise, or by any legal or
equitable proceeding by virtue of any constitution, statute, contract of
subscription or otherwise (including, without limiting the generality of the
foregoing, any proceeding to enforce any claimed liability of stockholders of
the Company based upon any theory of disregarding the corporate entity of the
Company or upon any theory that the Company was acting as the agent or
instrumentality of the stockholders), any and all such liability of
incorporators, stockholders, subscribers, officers and

                                       2
directors, as such, being released by the holder hereof, by the acceptance of
this bond, and being likewise waived and released by the terms of the Indenture
under which this bond is issued.
 
     This bond shall not be valid or become obligatory for any purpose until the
certificate of authentication endorsed hereon shall have been signed by Morgan
Guaranty Trust Company of New York, or its successor, as Trustee under the
Indenture.

 
     IN WITNESS WHEREOF, PENNSYLVANIA GAS AND WATER COMPANY has caused this bond
to be signed in its name by, or to bear the facsimile signature of, its
President or a Vice President, and its corporate seal to be affixed hereto and
attested by, or to bear the facsimile signature of, its Secretary or an
Assistant Secretary.
 
Dated: December   , 1993
 
                                       PENNSYLVANIA GAS AND WATER COMPANY
                                       By:______________________________________
                Vice President
 
Attest:
               Secretary
 
     This bond is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.
 
MORGAN GUARANTY TRUST COMPANY
  OF NEW YORK, as Trustee
By:________________________________
          Authorized Officer

                                       3
 
                     [FORM OF BOND OF THE TWENTIETH SERIES]
 
     THE BOND EVIDENCED BY THIS CERTIFICATE HAS BEEN ISSUED IN A PRIVATE
TRANSACTION, HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR REGISTERED OR QUALIFIED UNDER THE SECURITIES OR BLUE SKY LAWS OF ANY
STATE AND MAY NOT BE OFFERED, TRANSFERRED, SOLD, PLEDGED, HYPOTHECATED OR
OTHERWISE DISPOSED OF EXCEPT IN ACCORDANCE WITH THAT ACT, SUCH LAWS AND THE
RULES AND REGULATIONS PROMULGATED THEREUNDER.
 
                       PENNSYLVANIA GAS AND WATER COMPANY
             (Formerly Scranton-Spring Brook Water Service Company)
                   First Mortgage Bond 6.05% Series due 2019
 
No.__________________________                         $_________________________
 
     PENNSYLVANIA GAS AND WATER COMPANY (formerly Scranton-Spring Brook Water
Service Company), a corporation organized and existing under the laws of the
Commonwealth of Pennsylvania (hereinafter sometimes called the 'Company'), for
value received, promises to pay to __________________, or registered assigns, on
January 1, 2019 (unless this bond shall have been called for previous redemption
and provision made for the payment of the redemption price thereof),
__________________ Dollars at the Company's office or agency in the Borough of
Manhattan, The City of New York, and, except as otherwise set forth below,
semi-annually on the first day of July and the first day of January in each year
commencing July 1, 1994, to pay interest thereon, at said office or agency, at
the rate of 6.05% per annum from the interest payment date to which interest has
been paid next preceding the date of authentication of this bond (except that if
the date of authentication of this bond is an interest payment date for bonds of

this series to which interest has been paid it shall bear interest from the date
of authentication of this bond, and except that if this bond be authenticated
prior to the first interest payment date for bonds of this series, it shall bear
interest from December 1, 1993), until the Company's obligation with respect to
such principal sum shall be discharged; provided that, so long as there is no
existing default in the payment of interest, and except for the payment of
defaulted interest, the interest payable on any July 1 or January 1 will be paid
to the person in whose name this bond was registered at the close of business on
the fifteenth day of June or the fifteenth day of December next preceding such
interest payment date; and further provided that the interest payable on the
bonds of this series shall be reduced to the extent that other moneys then on
deposit with PNC Bank, National Association, as trustee, or any successor
trustee (the 'IDA Trustee') under the Trust Indenture dated as of December 1,
1993 (the 'Trust Indenture') from the Luzerne County Industrial Development
Authority (the 'Authority') to the IDA Trustee are available for the purpose of
paying interest on the bonds of this series

                                       4
and a credit in respect thereof has been granted pursuant to the Trust
Indenture. The principal of, premium if any, and the interest on this bond shall
be payable in any coin or currency of the United States of America which at the
time of payment shall be legal tender for the payment of public and private
debts.
 
     This bond is one of an issue of bonds of the Company, known as its First
Mortgage Bonds, issued and to be issued in one or more series under, and equally
and ratably secured (except as any sinking, amortization, improvement or other
fund, established in accordance with the provisions of the indenture hereinafter
mentioned, may afford additional security for the bonds of any particular
series) by, a certain mortgage and deed of trust, dated as of March 15, 1946
(hereinafter called the 'Original Indenture'), and by twenty-eight indentures
supplemental thereto (of which, the Seventeenth Supplemental Indenture, dated as
of October 15, 1967, the Eighteenth Supplemental Indenture, dated as of May 1,
1970, and the Twentieth Supplemental Indenture, dated as of March 1, 1976,
amended certain provisions of the Original Indenture) (said Original Indenture
and all said indentures supplemental thereto being hereinafter collectively
called the 'Indenture'), made by the Company to Guaranty Trust Company of New
York and, after the change of name of Guaranty Trust Company of New York to
Morgan Guaranty Trust Company of New York, to Morgan Guaranty Trust Company of
New York, as Trustee (hereinafter called the 'Trustee'), to which Indenture (and
to all additional indentures supplemental thereto) reference is hereby made for
a description of the property mortgaged, the nature and extent of the security,
the rights and limitations of rights of the Company, the Trustee, and the
holders of said bonds under the Indenture, and the terms and conditions upon
which said bonds are secured, to all of the provisions of which Indenture and of
all such additional supplemental indentures in respect of such security,
including the provisions of the Indenture permitting the issue of bonds of any
series in respect of property which, under the restrictions and limitations
therein specified, may be subject to liens prior to the lien of the Indenture,
the holder, by accepting this bond, assents. To the extent permitted by and as
provided in the Indenture, the rights and obligations of the Company and of the
holders of said bonds (including those pertaining to any sinking or other fund)
may be changed and modified, with the consent of the Company, by the holders of
at least 75% in aggregate principal amount of the bonds then outstanding (or, if

one or more, but less than all, series of bonds are affected, by the holders of
at least 75% in aggregate principal amount of outstanding bonds of such one or
more series so affected), such percentage being determined as provided in the
Indenture; provided, however, that without the consent of the holder hereof no
such modification or alteration shall be made which will extend the time of
payment of the principal of, premium, if any, or the interest on this bond or
reduce the principal amount hereof, or premium, if any, or the rate of interest
hereon or effect any other modification of the terms of payment of such

                                       5
principal or interest or will permit the creation of any lien ranking prior to
or on a parity with the lien of the Indenture on any of the mortgaged property,
or will deprive any non-assenting holder of this bond of a lien upon the
mortgaged property for the security of this bond, or will reduce the percentage
of bonds required for the aforesaid action under the Indenture and provided
further that, as provided in Section 4.02 of the Twentieth Supplemental
Indenture, when all bonds of all series issued prior to January 1, 1976, shall
cease to be outstanding, each reference to '75%' in this sentence shall become
'60%.' This bond is one of a series of bonds designated as the First Mortgage
Bonds 6.05% Series due 2019 of the Company.
 
     The bonds of this series are subject to redemption upon not less than
thirty (30) nor more than sixty (60) days' prior notice, in whole or in part,
under the circumstances set forth in paragraphs (A), (B) and (C), below.
 
     (A) The bonds of this series are subject to mandatory redemption, in whole
or in part, upon any redemption of the Luzerne County Industrial Development
Authority Exempt Facilities Revenue Refunding Bonds, 1993 Series A (Pennsylvania
Gas and Water Company Project) due January 1, 2019 (the '1993 Series A Bonds').
The principal amount of bonds of this series to be redeemed upon any redemption
of the 1993 Series A Bonds shall be equal to 100% of the principal amount of
1993 Series A Bonds which are to be redeemed. The redemption price of the bonds
of this series which are redeemed under the circumstances set forth in this
paragraph (A) shall be equal to 100% of the principal amount of the bonds of
this series to be redeemed plus interest accrued to the date fixed for
redemption except (i) in the case of bonds of this series which are redeemed
upon a redemption of the 1993 Series A Bonds at the option of the Authority
(other than in an 'Extraordinary Optional Redemption,' as defined in the Trust
Indenture) upon the direction of the Company (an 'Optional IDA Redemption')
which occurs between January 1, 2004 and December 31, 2004, inclusive, the
redemption price shall be equal to 102% of the principal amount of the bonds of
this series to be redeemed plus interest accrued to the date fixed for
redemption and (ii) in the case of bonds of this series which are redeemed upon
an Optional IDA Redemption which occurs between January 1, 2005 and December 31,
2005, inclusive, the redemption price shall be equal to 101% of the principal
amount of the bonds of this series to be redeemed plus interest accrued to the
date fixed for redemption.
 
     (B) The bonds of this series are subject to mandatory redemption, in whole,
if the IDA Trustee declares the 1993 Series A Bonds to be immediately due and
payable under Section 9.02 of the Trust Indenture. The redemption price of the
bonds of this series which are redeemed under the circumstances set forth in
this paragraph (B) shall be equal to 100% of the principal amount of the bonds
of this series to be redeemed plus interest accrued to the date fixed for

redemption.

                                       6
 
     (C) The bonds of this series are subject to mandatory redemption, in whole
or in part (but if in part on a pro rata basis with bonds of all other series
then outstanding under the Indenture), pursuant to the provisions of Section
8.13 of the Indenture. The redemption price of the bonds of this series which
are redeemed under the circumstances set forth in this paragraph (C) shall be
equal to 100% of the principal amount of the bonds of this series to be redeemed
plus interest accrued to the date fixed for redemption.
 
     If this bond shall be called for redemption, and payment of the redemption
price shall be duly provided by the Company as specified in the Indenture,
interest shall cease to accrue hereon from and after the date of redemption
fixed in the notice thereof.
 
     The principal of this bond may be declared or may become due prior to the
maturity date hereinbefore named, on the conditions, in the manner and at the
times set forth in the Indenture, upon the happening of a default as therein
defined.
 
     This bond is transferable by the registered owner hereof in person or by
his duly authorized attorney at the office or agency of the Company in the
Borough of Manhattan, The City of New York, upon surrender and cancellation of
this bond, and thereupon a new bond or bonds of the same series and maturity,
for a like aggregate principal amount, will be issued to the transferee in
exchange therefor, as provided in the Indenture. The Company and the Trustee and
any registrar and any paying agent may deem and treat the person in whose name
this bond is registered as the absolute owner hereof for the purpose of
receiving payment and for all other purposes.
 
     This bond, alone or with other bonds of the same series and maturity, may
in like manner be exchanged at such office or agency for one or more new bonds
of the same series and maturity of the same aggregate principal amount. Upon
each such transfer or exchange the Company may require the payment of charges as
prescribed in the Indenture.
 
     No recourse under or upon any covenant or obligation of the Indenture, or
of any bonds thereby secured, or for any claim based thereon, or otherwise in
any manner in respect thereof, shall be had against any incorporator, subscriber
to the capital stock, stockholder, officer or director, as such, whether former,
present or future, of the Company or any successor corporation, either directly,
or indirectly through the Company or the Trustee, by the enforcement of any
subscription to capital stock, assessment or otherwise, or by any legal or
equitable proceeding by virtue of any constitution, statute, contract of
subscription or otherwise (including, without limiting the generality of the
foregoing, any proceeding to enforce any claimed liability of stockholders of
the Company based upon any theory of disregarding the corporate entity of the
Company or upon any theory

                                       7
that the Company was acting as the agent or instrumentality of the
stockholders), any and all such liability of incorporators, stockholders,

subscribers, officers and directors, as such, being released by the holder
hereof, by the acceptance of this bond, and being likewise waived and released
by the terms of the Indenture under which this bond is issued.
 
     This bond shall not be valid or become obligatory for any purpose until the
certificate of authentication endorsed hereon shall have been signed by Morgan
Guaranty Trust Company of New York, or its successor, as Trustee under the
Indenture.
 
     IN WITNESS WHEREOF, PENNSYLVANIA GAS AND WATER COMPANY has caused this bond
to be signed in its name by, or to bear the facsimile signature of, its
President or a Vice President, and its corporate seal to be affixed hereto and
attested by, or to bear the facsimile signature of, its Secretary or an
Assistant Secretary.
 
Dated:
 
                                       PENNSYLVANIA GAS AND WATER COMPANY
                                       By:______________________________________
                Vice President
 
Attest:
               Secretary
 
               [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
 
     This bond is one of the bonds, of the series designated therein, described
in the within-mentioned Indenture.
 
MORGAN GUARANTY TRUST COMPANY
  OF NEW YORK, as Trustee
By:________________________________
          Authorized Officer