THE CINCINNATI GAS & ELECTRIC COMPANY

                                       AND

                              THE FIFTH THIRD BANK,
                                            Trustee



                          Fifth Supplemental Indenture

                            Dated as of June 9, 1998

                                       To

                                    Indenture

                            Dated as of May 15, 1995



                  6.35% REset Put Securities (REPSsm) Due 2038








<PAGE>



         FIFTH  SUPPLEMENTAL  INDENTURE,  dated as of June 9, 1998 (this  "Fifth
Supplemental  Indenture"),  between The  Cincinnati  Gas & Electric  Company,  a
corporation  duly  organized  and  existing  under the laws of the State of Ohio
(herein called the  "Company"),  having its principal  office at 139 East Fourth
Street,  Cincinnati,  Ohio  45202,  and The Fifth Third  Bank,  an Ohio  banking
corporation,  as Trustee (herein called the "Trustee") under the Indenture dated
as of  May  15,  1995  between  the  Company  and  the  Trustee  (the  "Original
Indenture").


                             Recitals of the Company


         The Company has executed and  delivered  the Original  Indenture to the
Trustee  to  provide  for the  issuance  from  time  to  time  of its  unsecured
debentures,  notes or other evidences of indebtedness (the "Securities"),  to be
issued in one or more series as in the Original Indenture provided.

         Pursuant to the terms of the Original Indenture, the Company desires to
provide for the  establishment  of a new series of its Securities to be known as
its 6.35% REset Put Securities  (REPSsm)  (herein called the  "Debentures"),  in
this Fifth Supplemental Indenture.

         All things necessary to make this Fifth Supplemental  Indenture a valid
agreement of the Company have been done.

         Now, Therefore, This Fifth Supplemental Indenture Witnesseth:

         For  and in  consideration  of the  premises  and the  purchase  of the
Debentures  by the Holders  thereof,  it is mutually  agreed,  for the equal and
proportionate benefit of all Holders of the Debentures, as follows:



                                   ARTICLE ONE

                                  Defined Terms

     Section 101. Defined Terms.  Except as otherwise expressly provided in this
Fifth  Supplemental  Indenture or in the form of Debenture or otherwise  clearly
required by the context hereof or thereof,  all  capitalized  terms used and not
defined  herein or in said form of  Debenture  that are defined in the  Original
Indenture  shall have the meanings  assigned to them in the Original  Indenture.
The Original  Indenture,  as supplemented  from time to time,  including by this
Fifth Supplemental Indenture, is hereafter referred to as the "Indenture".

                                   ARTICLE TWO

                             Terms of the Debentures

     Section 201. Establishment of the Debentures.  There is hereby authorized a
series of Securities  designated  the "6.35% REset Put  Securities  (REPSsm) Due
2038",  limited in aggregate  principal amount to  $100,000,000.  The Debentures
shall be  substantially  in the form set  forth in  Exhibit  A hereto  and shall
include  substantially  the legend  shown so long as the  Debentures  are Global
Securities.

     Section 202. Terms of the  Debentures.  The  Debentures  will be issued and
maintained  exclusively  in the form of a  registered  Global  Security  without
coupons,  registered  in the name of Cede & Co.,  as nominee  of The  Depository
Trust Company (the  "Depositary"  or "DTC") except in the limited  circumstances
described in Section 305 of the Original  Indenture,  and  beneficial  interests
therein may be acquired, or subsequently  transferred,  only in denominations of
$1,000 or  integral  multiples  thereof.  The  provisions  of Section 305 of the
Original   Indenture   applicable  to  Global  Securities  shall  apply  to  the
Debentures.

     The Debentures will bear interest at the rate of 6.35% from June 9, 1998 to
but excluding  June 15, 2003 (the "First  Coupon Reset Date").  The First Coupon
Reset Date, June 15, 2008, June 15, 2013, June 15, 2018, June 15, 2023, June 15,
2028 and June 15, 2033, are each referred to herein as a "Coupon Reset Date." If
the Company has not theretofore  purchased the aggregate principal amount of the
Debentures,  in whole, the upcoming Coupon Reset Date at any time is referred to
herein as the  "Applicable  Coupon Reset Date."  Interest on the  Debentures  is
payable  semiannually  on  June 15 and  December  15 of  each  year,  commencing
December 15, 1998 (each an "Interest Payment Date"). Interest will be calculated
based on a 360-day year  consisting  of twelve 30-day  months.  On each Interest
Payment  Date,  interest  shall be  payable  to the  persons  in whose  name the
Debentures  are  registered  on the books of the  Trustee  on the  Business  Day
immediately  preceding the related Interest Payment Date (each a "Regular Record
Date"). "Business Day" means any day other than a Saturday, a Sunday or a day on
which banking institutions in the City of New York are authorized or required by
law or regulation to be closed.

     If the  Callholder  (as defined  below)  elects to purchase  the  principal
amount of the  Debentures  pursuant to its Call Option (as defined  below),  the
Calculation  Agent (as defined  below) will reset the interest rate effective on
the Applicable Coupon Reset Date for the Debentures,  pursuant to procedures set
forth  in  the  Calculation   Agency  Agreement  (as  defined  below).  In  such
circumstance,  (i) the principal  amount of Debentures  will be purchased by the
Callholder  at 100% of the principal  amount  thereof on the  Applicable  Coupon
Reset Date, on the terms and subject to the conditions  described  herein and in
the  Calculation  Agency  Agreement  (interest  accrued  to  but  excluding  the
Applicable  Coupon  Reset  Date will be paid by the  Company on such date to the
holders of the  Debentures on the most recent  Regular  Record Date) and (ii) on
and after the Applicable Coupon Reset Date, the Debentures will bear interest at
the rate determined by the  Calculation  Agent in accordance with the procedures
set forth in the Calculation Agency Agreement and the form of Debentures.

     The Debentures will mature on June 15, 2038 (the "Maturity  Date").  On the
Applicable  Coupon  Reset  Date,  however,  holders  of the  Debentures  will be
entitled to receive 100% of the  principal  amount  thereof  either from (i) the
Callholder,  if the  Callholder  purchases the  Debentures,  in whole but not in
part,  pursuant to its Call Option described in Article Three hereof or (ii) the
Company, by the exercise of the Put Option (as defined below) by the Trustee for
and on behalf of the  holders  of the  Debentures,  if the  Callholder  does not
purchase the Debentures  pursuant to the Call Option.  If the Call Option is not
exercised or if the Call Option otherwise terminates, the Trustee shall exercise
the Put Option  described  in Article  Four  hereof  without  the consent of, or
notice to, the holders of the Debentures.

     Principal of and interest on the  Debentures  will initially be payable and
the Debentures will be transferable at the corporate trust office of the Trustee
in the City of Cincinnati, located at 38 Fountain Square Plaza, Cincinnati, Ohio
45263  provided  that  payment  of  interest  may be made at the  option  of the
Company,  by checks  mailed to  registered  holders  of the  Debentures.  If the
Debentures are issued in certificated form under the circumstances  described in
Section 305 of the Original  Indenture,  payment  shall be made at the Corporate
Trust Office of the Trustee against surrender of the applicable Debentures.


                                  ARTICLE THREE

                                   Call Option

     Section 301. Call Option.  The Callholder,  by giving notice to the Trustee
in accordance  with Section 302 hereof,  has the right to purchase the aggregate
principal amount of Debentures, in whole but not in part (the "Call Option"), on
the  Applicable  Coupon  Reset Date,  at a price equal to 100% of the  principal
amount  thereof  (the  "Call  Price")  (interest  accrued to but  excluding  the
Applicable  Coupon  Reset  Date to be paid by the  Company  on such  date to the
holders of the Debentures on the most recent Regular Record Date).  The Company,
as holder of the Call  Option in  respect  of the  Debentures,  or any person to
which the Call Option is  assigned in  accordance  with  Section 305 hereof,  is
referred to herein as the "Callholder" in respect of the Debentures.

     In the event the  Callholder  exercises  its rights  under the Call Option,
unless  terminated  in accordance  with its terms,  then (i) not later than 2:00
p.m.,  New York time on the  Business Day prior to the  Applicable  Coupon Reset
Date, the Callholder shall deliver the Call Price in immediately available funds
to the Trustee for payment of the Call Price on the Applicable Coupon Reset Date
and (ii) the holders of the  Debentures  will be required to deliver and will be
deemed to have  delivered  the  Debentures  to the  Callholder  against  payment
therefor on the  Applicable  Coupon  Reset Date  through the  facilities  of the
Depositary.

     The  Callholder is not required to exercise the Call Option,  and no holder
of the Debentures or any interest  therein shall have any right or claim against
the  Callholder  as a result  of the  Callholder's  decision  whether  or not to
exercise the Call Option or performance or  non-performance  of its  obligations
with respect thereto.

     Section 302.  Notice.  With respect to the  Debentures  and the Call Option
related thereto,  the Callholder must deliver  irrevocable,  written notice (the
"Call  Notice") to the Trustee of its  exercise of the Call Option prior to 4:00
p.m.  New York  City,  no later than  fifteen  (15)  calendar  days prior to the
Applicable  Coupon  Reset Date.  The Call  Notice  shall  contain the  requisite
delivery details,  including the  identification of the Callholder's  Depositary
Account.  The Trustee shall send a copy of the Call Notice to the holders of the
Debentures no later than the immediately succeeding Business Day.

     Section 303.  Termination of Call Option.  Except as otherwise specified in
clause (a) below, the Call Option will automatically and immediately  terminate,
no payment will be due from the  Callholder  and the Coupon  Reset  Process will
terminate,  if any of the following occurs: (a) at any time prior to the sale of
the  Debentures on the third Business Day  immediately  preceding the Applicable
Coupon Reset Date (the "Bid Date"),  (i) an Event of Default has occurred and is
continuing  under  Sections  501(1),  (2),  (3),  (4) or (7) under the  Original
Indenture,  (ii) a default, event of default or other similar condition or event
(however  described)  in respect of the Company or any of its  subsidiaries  has
occurred under one or more agreements or instruments relating to indebtedness of
the Company or any of its  subsidiaries  (individually  or  collectively)  in an
aggregate  amount  of not less than  $25,000,000,  which  has  resulted  in such
indebtedness  becoming due and payable,  under such  agreements or  instruments,
before it would otherwise have been due and payable, or (iii) the Company or any
of its subsidiaries has defaulted in making one or more payments on the due date
thereof  in an  aggregate  amount  of  not  less  than  $25,000,000  under  such
agreements  or  instruments  (after  giving  effect  to  any  applicable  notice
requirement or grace period) (in any such event,  termination is at Callholder's
option) or an Event of Default has occurred  and is  continuing  under  Sections
501(5) or (6) under the Original  Indenture (in any such event,  termination  is
automatic),  (b) if following the Call Notice,  less than two dealers named on a
list of dealers provided by the Company to Morgan Stanley & Co. Incorporated, as
calculation  agent (the  "Calculation  Agent"),  have  provided  an  irrevocable
written  offer for the purchase of the  Debentures,  settling on the  Applicable
Coupon  Reset Date,  in a timely  manner as provided in the  Calculation  Agency
Agreement,  dated  as of June 9,  1998  (the  "Calculation  Agency  Agreement"),
between  the Company  and the  Calculation  Agent,  (c) if,  following  the Call
Notice,  the Callholder fails to pay the Call Price by 2:00 p.m., New York time,
on the  Business  Day  prior  to the  Applicable  Coupon  Reset  Date due to the
occurrence  of a Market  Disruption  Event,  (d) if the  Company  elects to have
Section 1302  (Defeasance  and Discharge) or Section 1303 (Covenant  Defeasance)
under the Original  Indenture  applied to any of its Securities or any series of
its  Securities  or (e) if the Company  exercises  the Optional  Redemption  (as
defined herein) under Section 501 hereof.  "Market  Disruption Event" shall mean
any of the following  events,  if such events occur or are continuing on any day
from,  and including,  15 calendar days prior to the upcoming  Coupon Reset Date
to, and including,  the Bid Date in the judgment of the Calculation Agent: (A) a
suspension or material limitation in trading in securities  generally on the New
York Stock Exchange or the establishment of minimum prices on such exchange; (B)
a general moratorium on commercial banking activities declared by either federal
or New York State  authorities;  (C) any material adverse change in the existing
financial, political or economic conditions in the United States of America; (D)
an outbreak or  escalation of major  hostilities  involving the United States of
America or the  declaration of a national  emergency or war by the United States
of America;  or (E) any  material  disruption  of the U.S.  Treasury  securities
market,  U.S.  corporate bond market or U.S. federal wire system;  provided,  in
each  case,  that in the  judgment  of the  Calculation  Agent the effect of the
foregoing makes it impractical to conduct the Coupon Reset Process.

     Section 304. Trustee Notification.

     (i) The Company and, if different,  the Callholder will promptly notify the
Trustee in writing of the  termination  of the Call  Option.  The  Trustee  will
promptly  thereafter  notify the holders of the Debentures that the Trustee,  on
behalf of such holders, is required to exercise the Put Option on the Applicable
Coupon Reset Date.

     (ii) In  anticipation  of the exercise of the Call Option or the Put Option
on the Applicable Coupon Reset Date, the Trustee shall notify the holders of the
Debentures,  not less than 30 days nor more than 60 days prior to the Applicable
Coupon Reset Date,  that all  Debentures  shall be  delivered on the  Applicable
Coupon Reset Date through the  facilities of the Depositary  against  payment of
the Call  Price by the  Callholder  under the Call  Option or payment of the Put
Price (as defined below) by the Company under the Put Option.

     Section 305.  Successors  and Assigns.  A Callholder may at any time assign
its rights and obligations under its Call Option;  provided,  however,  (i) such
rights  and  obligations  are  assigned  in  whole  and not in part  and (ii) it
provides   the  Trustee  and  the  Company   with  notice  of  such   assignment
contemporaneously  with such  assignment.  Upon receipt of notice of assignment,
the Trustee  shall treat the assignee as  Callholder  under such Call Option for
all purposes hereunder. A Callholder may assign its rights under its Call Option
without notice to, or consent of, the holders of the Debentures.


                                  ARTICLE FOUR

                                   Put Option

     Section  401.  If the Call  Option is not  exercised  or if the Call Option
otherwise  terminates,  the Trustee is  required  to  exercise  the right of the
holders of the  Debentures  to require  the Company to  purchase  the  aggregate
principal amount of Debentures,  in whole but not in part (the "Put Option"), on
the  Applicable  Coupon  Reset  Date at a price  equal to 100% of the  principal
amount  thereof  (the "Put  Price"),  plus  accrued  but unpaid  interest to but
excluding  such  Applicable  Coupon Reset Date,  in each case, to be paid by the
Company to such Holders on the Applicable Coupon Reset Date.

     If the Trustee  exercises the Put Option then the Company shall deliver the
Put Price in immediately  available  funds to the Trustee by no later than 12:00
p.m.  New York time on the  Applicable  Coupon Reset Date and the holders of the
Debentures  will be required to deliver and will be deemed to have delivered the
Debentures to the Company  against  payment  therefor on the  Applicable  Coupon
Reset  Date  through  the  facilities  of the  Depositary.  By its  purchase  of
Debentures,  each holder  irrevocably agrees that the Trustee shall exercise the
Put Option  relating to such  Debentures for or on behalf of each holder of such
Debentures as provided  herein.  No holder of any  Debentures or of any interest
therein  has the right to consent  or object to the  exercise  of the  Trustee's
duties under the Put Option.

                                  ARTICLE FIVE

                               Optional Redemption

     Section  501.  Subject  to the  terms of  Article  Eleven  of the  Original
Indenture, the Company shall have the right to redeem the Offered Debentures, in
whole but not in part,  from time to time and at any time (such  redemption,  an
"Optional  Redemption",  and the date thereof,  the "Optional  Redemption Date")
upon not less than 30 days' notice to the holders,  at a redemption  price equal
to the  sum of (A)  the  greater  of (i)  100% of the  principal  amount  of the
Debentures to be redeemed or (ii) the sum of the present values of the Remaining
Scheduled  Payments  thereon  discounted  to the Optional  Redemption  Date on a
semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate plus 10 basis points,  less the  Applicable  Accrued  Interest
Amount plus (B) the Applicable Accrued Interest Amount.

     "Applicable  Accrued  Interest  Amount" means,  at the Optional  Redemption
Date, the amount of interest  accrued and unpaid from the prior interest payment
date to the Optional  Redemption Date on the Debentures  subject to the Optional
Redemption determined at the rate per annum shown in the title thereof, computed
on the basis of a 360-day year of twelve 30-day months.

     "Comparable  Treasury  Issue"  means the United  States  Treasury  security
selected by an Independent  Investment Banker as having a maturity that would be
utilized,  at the time of selection and in accordance  with customary  financial
practice,  in pricing new issues of  corporate  debt  securities  of  comparable
maturity to the remaining term of the Debentures to be redeemed  pursuant to the
Optional Redemption.  "Independent Investment Banker" means one of the Reference
Treasury Dealers appointed by the Trustee after consultation with the Company.

     "Comparable  Treasury Price" means, with respect to the Optional Redemption
Date, the average of the Reference  Treasury Dealer Quotations for such Optional
Redemption Date.

     "Reference   Treasury   Dealer"   means  each  of  Morgan   Stanley  &  Co.
Incorporated,  Lehman Brothers Inc., and their respective successors;  provided,
however,  that  if  any  of the  foregoing  shall  cease  to be a  primary  U.S.
Government  securities dealer in New York City (a "Primary Treasury Dealer") the
Company will substitute  therefor another Primary  Treasury  Dealer.  "Reference
Treasury  Dealer  Quotations"  means,  with respect to each  Reference  Treasury
Dealer and any redemption  date, the average,  as determined by the Trustee,  of
the bid and asked prices for the Comparable  Treasury  Issue  (expressed in each
case as a percentage of its principal  amount)  quoted in writing to the Trustee
by such  Reference  Treasury  Dealer at 5:00  p.m.  on the  third  Business  Day
preceding such redemption date.

     "Remaining  Scheduled  Payments" means, with respect to any Debenture,  the
remaining  scheduled  payments  of the  principal  thereof  to be  redeemed  and
interest  thereon that would be due after the Optional  Redemption  Date but for
the Optional Redemption.

     "Treasury  Rate" means,  with respect to the Optional  Redemption  Date (if
any), the rate per annum equal to the semiannual equivalent yield to maturity of
the Comparable  Treasury  Issue,  assuming a price for the  Comparable  Treasury
Issue  (expressed  as a  percentage  of  its  principal  amount)  equal  to  the
Comparable Treasury Price for such Optional Redemption Date.


                                   ARTICLE SIX

                         Original Issuance of Debentures

     Section 601.  Debentures in the aggregate principal amount of $100,000,000,
may, upon execution of this Fifth Supplemental  Indenture,  or from time to time
thereafter,  be  executed  by the  Company  and  delivered  to the  Trustee  for
authentication,  and the Trustee shall thereupon  authenticate  and deliver said
Debentures upon a Company Order without any further action by the Company.


                                  ARTICLE SEVEN

                       Paying Agent and Security Registrar

     Section  701.  The Fifth Third Bank will be the paying  Agent and  Security
Registrar for the Debentures.


                                  ARTICLE EIGHT

                                Sundry Provisions

     Section  801.   Appointment  of  Replacement   Calculation  Agent.  If  the
Calculation Agent is removed or resigns pursuant to Section 7 of the Calculation
Agency  Agreement and within 30 days of notice of such removal or resignation no
new Calculation  Agent shall have been appointed by the Company,  and shall have
accepted  such  appointment,  the  Trustee  may, on behalf of the holders of the
Debentures, appeal to a court to appoint a new Calculation Agent.

     Section  802.  The  Original  Indenture,  as  supplemented  by  this  Fifth
Supplemental  Indenture,  is in all respects  ratified and  confirmed,  and this
Fifth  Supplemental  Indenture shall be deemed part of the Original Indenture in
the manner and to the extent herein and therein provided.

     Section  803.  Counterparts.  This  Fifth  Supplemental  Indenture  may  be
executed  in any  number of  counterparts,  each of which so  executed  shall be
deemed an original,  but all such counterparts shall together constitute but one
and the same instrument.


     IN WITNESS WHEREOF,  the parties hereto have caused this Fifth Supplemental
Indenture to be duly executed as of the date first written above.



                      THE CINCINNATI GAS & ELECTRIC COMPANY



                                    By          /s/ William L. Sheafer
                                                  William L. Sheafer
                                                  Vice President and
                                                      Treasurer


                        THE FIFTH THIRD BANK, as Trustee



                                  By            /s/ Kerry Byrne
                                                  Kerry Byrne
                                                Vice President





<PAGE>



                                                                       EXHIBIT A

                           [FORM OF FACE OF DEBENTURE]

                      THE CINCINNATI GAS & ELECTRIC COMPANY

No. R-1
CUSIP No. 172070CG7                                                 $100,000,000




     UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER,  EXCHANGE,  OR PAYMENT, AND ANY CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED  REPRESENTATIVE  OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

     THE CINCINNATI  GAS & ELECTRIC  COMPANY,  a corporation  duly organized and
existing under the laws of the State of Ohio (herein called the "Company", which
term includes any successor Person under the Indenture hereinafter referred to),
for value received, hereby promises to pay to CEDE & CO., or registered assigns,
the principal sum of One Hundred  Million and No/100 Dollars  ($100,000,000)  on
June 15, 2038,  and to pay  interest  thereon from June 9, 1998 or from the most
recent  Interest  Payment Date to which  interest has been paid or duly provided
for at the rate determined as set forth on the reverse  hereof,  semiannually on
June  15 and  December  15 of each  year  (each  an  "Interest  Payment  Date"),
commencing  December 15, 1998, on said  principal  sum. The interest so payable,
and punctually paid or duly provided for, on any Interest  Payment Date will, as
provided in such  Indenture,  be paid to the Person in whose name this  Security
(or one or more  Predecessor  Securities) is registered at the close of business
on the Regular  Record Date for such  interest,  which shall be the Business Day
immediately  preceding  such Interest  Payment Date.  Any such interest which is
payable, but is not punctually paid or duly provided for on any Interest Payment
Date ("Defaulted  Interest") will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more  Predecessor  Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted  Interest to
be fixed by the Trustee,  notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special  Record  Date,  or be
paid  at any  time  in  any  other  lawful  manner  not  inconsistent  with  the
requirements  of any securities  exchange on which the Securities of this series
may be then  listed,  and upon such notice as may be required by such  exchange,
all as more fully provided in such Indenture.

     Payment of the  principal  of (and  premium,  if any) and  interest on this
Security shall be made at the corporate  trust office of the Trustee  maintained
for that  purpose in the City of  Cincinnati,  in such coin or  currency  of the
United  States of America as at the time of payment is legal  tender for payment
of public  and  private  debts;  provided,  however,  that at the  option of the
Company  payment of interest  may be made by check  mailed to the address of the
Person entitled thereto as such address shall appear in the Security Register.

     Any payment on this  Security due on any day which is not a Business Day in
the City of New York need not be made on such  day,  but may be made on the next
succeeding  Business  Day with the same  force and  effect as if made on the due
date and no interest  shall  accrue for the period from and after such due date,
unless such payment is a payment at maturity or upon  redemption,  in which case
interest shall accrue thereon at the stated rate for such additional days.

     As used  herein,  "Business  Day" means any day,  other than a Saturday  or
Sunday  or a day on  which  banking  institutions  in New  York,  New  York  are
authorized or required by law or regulation to be closed.

     Reference  is hereby made to the further  provisions  of this  Security set
forth on the reverse hereof, including those describing the Call Option, the Put
Option,  the Optional  Redemption  and the Coupon Reset  Process,  which further
provisions  shall for all purposes  have the same effect as if set forth at this
place.

     Unless the  certificate of  authentication  hereon has been executed by the
Trustee  referred to on the reverse  hereof by manual  signature,  this Security
shall  not be  entitled  to any  benefit  under  the  Indenture  or be  valid or
obligatory for any purpose.


     IN WITNESS  WHEREOF,  the  Company has caused  this  instrument  to be duly
executed.

Dated:

                           THE CINCINNATI GAS & ELECTRIC COMPANY


                           By:_________________________________


CERTIFICATE OF AUTHENTICATION

         This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.

Dated:

                           THE FIFTH THIRD BANK, as Trustee


                           By:_________________________________
                                    Authorized Signatory




<PAGE>








                          [FORM OF REVERSE OF SECURITY]


     This  Security  is one of a duly  authorized  issue  of  securities  of the
Company (herein called the "Securities"), issued and to be issued in one or more
series  under  an  Indenture,  dated  as of May  15,  1995  (herein  called  the
"Indenture", which term shall have the meaning assigned to it in such instrument
as  supplemented),  between the  Company  and The Fifth  Third Bank,  as Trustee
(herein  called the "Trustee",  which term includes any successor  trustee under
the Indenture), and reference is hereby made to the Indenture for a statement of
the respective rights,  limitations of rights,  duties and immunities thereunder
of the Company, the Trustee and the Holders of the Securities of this series and
of the terms  upon  which the  Securities  of this  series  are,  and are to be,
authenticated  and delivered.  This Security is one of the series  designated on
the face hereof, limited in aggregate principal amount to $100,000,000.

     Subject to the Call  Option,  the Put Option  and the  Optional  Redemption
described  below,  the  Securities  of this series are not  redeemable  prior to
maturity. The terms of the Securities of this series include those stated in the
Indenture.  The  Securities  of this  series  are  subject to all such terms and
Holders  (including  the Holder  hereof)  are  referred to the  Indenture  for a
statement of those terms.  Capitalized  terms used but not defined  herein shall
have the respective meanings assigned to them in the Indenture.

Interest Rate and Interest Payment Dates

     This Security will bear interest at the rate of 6.35 % from June 9, 1998 to
but excluding  June 15, 2003 (the "First  Coupon Reset Date").  The First Coupon
Reset Date, June 15, 2008, June 15, 2013, June 15, 2018, June 15, 2023, June 15,
2028 and June 15, 2033, are each referred to herein as a "Coupon Reset Date." If
the Company has not theretofore  purchased the aggregate principal amount of the
Securities of this series , in whole, the upcoming Coupon Reset Date at any time
is referred to herein as the  "Applicable  Coupon Reset Date."  Interest on this
Security  is  payable  semiannually  on June 15 and  December  15 of each  year,
commencing December 15, 1998 (each an "Interest Payment Date"). Interest on this
Security will be calculated based on a 360-day year consisting of twelve 30- day
months. On each Interest Payment Date,  interest shall be payable to the persons
in whose names the  Securities  of this  series are  registered  (including  the
Holder  hereof) on the books of the  Trustee  on the  Business  Day  immediately
preceding the related Interest Payment Date (each a "Regular Record Date").

     If the  Callholder  (as defined  below)  elects to purchase  the  principal
amount of this  Security  pursuant to its Call Option (as  defined  below),  the
Calculation  Agent (as defined  below) will reset the interest rate effective on
the Applicable  Coupon Reset Date for this Security,  pursuant to the procedures
set forth in the  Calculation  Agency  Agreement  (as  defined  below).  In such
circumstance,  (i)  the  principal  amount  hereof  will  be  purchased  by  the
Callholder at 100% of the principal amount hereof on the Applicable Coupon Reset
Date,  on the terms and subject to the  conditions  described  herein and in the
Calculation  Agency Agreement  (interest accrued to but excluding the Applicable
Coupon Reset Date will be paid by the Company on such date to the Holder  hereof
on the most recent  Regular  Record  Date) and (ii) on and after the  Applicable
Coupon Reset Date,  this Security  will bear interest at the rate  determined by
the  Calculation  Agent in  accordance  with  the  procedures  set  forth in the
Calculation Agency Agreement and described herein.

Maturity Date

     This Security will mature on June 15, 2038 (the  "Maturity  Date").  On the
Applicable  Coupon Reset Date,  however,  the Holder  hereof will be entitled to
receive 100% of the  principal  amount  hereof from (i) the  Callholder,  if the
Callholder  purchases  this  Security  pursuant  to its Call  Option or (ii) the
Company,  by the  exercise of the Put Option by the Trustee for and on behalf of
the Holder hereof, if the Callholder does not purchase this Security pursuant to
the Call  Option.  If the Call  Option is not  exercised  or if the Call  Option
otherwise terminates,  the Trustee shall exercise the Put Option described below
without the consent of, or notice to, the Holder hereof.

Call Option; Put Option

     (i) Call Option. The Callholder, by giving notice to the Trustee (the "Call
Notice"),  has the right to purchase the aggregate  principal amount hereof,  in
whole but not in part (the "Call Option"),  on the Applicable Coupon Reset Date,
at a price  equal to 100% of the  principal  amount  hereof  (the "Call  Price")
(interest  accrued to but excluding the Applicable  Coupon Reset Date to be paid
by the  Company on such date to the  Holder  hereof on the most  recent  Regular
Record  Date).  The  Company,  as holder of the Call  Option in  respect  of the
Securities of this series, or any person to which the Call Option is assigned in
accordance with Section 305 of the Fifth Supplemental  Indenture, is referred to
herein as the "Callholder" in respect of the Securities of this series. The Call
Notice  shall be given to the Trustee,  in writing,  prior to 4:00 p.m. New York
City, no later than fifteen  calendar days prior to the Applicable  Coupon Reset
Date. The Call Notice shall contain the requisite  delivery  details,  including
the  identification  of the Callholder's  DTC Account.  The Trustee shall send a
copy of the Call  Notice  to the  Holder  hereof no later  than the  immediately
succeeding Business Day.

     In the event the  Callholder  exercises  its rights  under the Call Option,
unless  terminated  in accordance  with its terms,  then (i) not later than 2:00
p.m.,  New York time, on the Business Day prior to the  Applicable  Coupon Reset
Date, the Callholder shall deliver the Call Price in immediately available funds
to the Trustee for payment thereof to the Holder hereof of the Call Price on the
Applicable  Coupon  Reset Date and (ii) the Holder  hereof  will be  required to
deliver and will be deemed to have  delivered  this  Security to the  Callholder
against  payment  therefor  on the  Applicable  Coupon  Reset Date  through  the
facilities  of DTC. The  Callholder is not required to exercise the Call Option,
and no Holder of the Securities of this series (including, the Holder hereof) or
any interest  herein shall have any right or claim  against the  Callholder as a
result of the  Callholder's  decision whether or not to exercise the Call Option
or performance or non-performance of its obligations with respect thereto.

     The Callholder may at any time assign its rights and obligations  under its
Call Option; provided,  however, (i) such rights and obligations are assigned in
whole and not in part and (ii) it provides  the  Trustee  and the  Company  with
notice of such assignment  contemporaneously with such assignment.  Upon receipt
of notice of  assignment,  the Trustee  shall treat the  assignee as  Callholder
under such Call Option for all purposes hereunder. The Callholder may assign its
rights under its Call Option without notice to, or consent of, the Holder hereof

     The  Indenture  sets forth certain  circumstances  in which the Call Option
will automatically be terminated.

     (ii) Put Option.  If the Call Option is not exercised or if the Call Option
otherwise  terminates,  the Trustee is  required  to  exercise  the right of the
Holder hereof to require the Company to purchase the aggregate  principal amount
of this Security, in whole but not in part (the "Put Option"), on the Applicable
Coupon Reset Date at a price equal to 100% of the  principal  amount hereof (the
"Put Price"),  plus accrued but unpaid interest to but excluding such Applicable
Coupon Reset Date,  in each case, to be paid by the Company to the Holder hereof
on the Applicable Coupon Reset Date.

     If the Trustee  exercises the Put Option then the Company shall deliver the
Put Price in immediately  available  funds to the Trustee by no later than 12:00
p.m. New York time on the  Applicable  Coupon  Reset Date and the Holder  hereof
will be required to deliver and will be deemed to have  delivered  this Security
to the Company  against  payment  therefor on the  Applicable  Coupon Reset Date
through the  facilities  of DTC. By its purchase of this  Security,  each Holder
irrevocably  agrees that the Trustee shall  exercise the Put Option  relating to
such Security for or on behalf each Holder of such Security as provided  herein.
No Holder of this Security or of any interest herein has the right to consent or
object to the exercise of the Trustee's duties under the Put Option.

Notice to Holders by Trustee

     In anticipation of the exercise of the Call Option or the Put Option on the
Applicable  Coupon Reset Date, the Trustee shall notify the Holder  hereof,  not
less than 30 days nor more than 60 days  prior to the  Applicable  Coupon  Reset
Date, that this Security shall be delivered on the Applicable  Coupon Reset Date
through  the  facilities  of DTC  against  payment  of  the  Call  Price  by the
Callholder  under the Call  Option or  payment  of the Put Price by the  Company
under the Put Option.

Coupon Reset Process if Securities are Called

     Pursuant to and  subject to the terms of a  Calculation  Agency  Agreement,
dated June 9, 1998,  between the Company and Morgan Stanley & Co.  Incorporated,
Morgan Stanley & Co.  Incorporated has been appointed the calculation  agent for
the  Securities  of this  series in  connection  with the Call  Option  (in such
capacity as  calculation  agent,  together with any  successors or assigns,  the
"Calculation  Agent"). If the Callholder has exercised the Call Option, then the
following  steps  (the  "Coupon  Reset  Process")  shall  be  taken  in order to
determine the interest rate to be paid on the Securities of this series from and
including the Applicable  Coupon Reset Date to but excluding the next succeeding
Coupon  Reset  Date or,  if there  are no more  Coupon  Reset  Dates  after  the
Applicable Coupon Reset Date, the Maturity Date. The Company and the Calculation
Agent shall use reasonable efforts to cause the actions contemplated below to be
completed in as timely a manner as possible.

          (a) The Company  shall provide the  Calculation  Agent with (i) a list
     (the "Dealer List"),  no later than five Business Days prior to each Coupon
     Reset Date (unless the Call Option has been terminated prior to such Coupon
     Reset Date),  containing the names and addresses of three  dealers,  one of
     which shall be Morgan  Stanley & Co.  Incorporated,  from which the Company
     desires the Calculation Agent to obtain the Bids (as defined below) for the
     purchase  of the  Securities  of this  series  and (ii) a copy of any other
     material  reasonably  requested by the  Calculation  Agent to  facilitate a
     successful Coupon Reset Process.

          (b) Within one Business Day following receipt by the Calculation Agent
     of the Dealer  List,  the  Calculation  Agent shall  provide to each dealer
     ("Dealer") on the Dealer List (i) a copy of the Prospectus Supplement dated
     June 4, 1998 and Prospectus dated June 4, 1998, relating to the offering of
     the Securities of this series (collectively, the "Prospectus"), (ii) a copy
     of the form of Securities  of this series and (iii) a written  request that
     each such dealer submit a Bid to the  Calculation  Agent no later than 3:00
     p.m.,  New York time,  on the third  Business  Day prior to the  Applicable
     Coupon Reset Date (the "Bid Date"). "Bid" shall mean an irrevocable written
     offer given by a Dealer for the purchase of all of the  Securities  of this
     series,  settling on the Applicable  Coupon Reset Date, and shall be quoted
     by such  Dealer as a stated  yield to maturity  on the  Securities  of this
     series ("Yield to  Maturity").  Each Dealer shall also be provided with (i)
     the name of the  Company,  (ii) an estimate of the  Purchase  Price  (which
     shall be stated as a US Dollar amount and be calculated by the  Calculation
     Agent in accordance with clause (c) below),  (iii) the principal amount and
     Maturity Date of the Securities of this series and (iv) the method by which
     interest will be calculated on the Securities of this series .

          (c) The purchase  price to be paid by any Dealer for the Securities of
     this  series  in  connection  with the  exercise  of the Call  Option  (the
     "Purchase  Price") shall be equal to the sum of (i) the principal amount of
     the  Securities  of this  series,  and  (ii)  an  amount  (the  "Debentures
     Difference")  which  shall be equal to the  difference,  if any, of (A) the
     discounted present value to the Applicable Coupon Reset Date of a debenture
     with a maturity of five years from the  Applicable  Coupon Reset Date which
     has an interest rate of 5.65%,  semiannual  interest  payments on each June
     15th and December 15th, commencing the December 15 following the Applicable
     Coupon Reset Date, and a principal  amount equal to the principal amount of
     the  Securities  of this series and  assuming a discount  rate equal to the
     Treasury Rate minus (B) such principal amount of Securities of this series.
     The "Treasury  Rate" means the per annum rate equal to the offer side yield
     to maturity  of the  current  on-the-  run 5-year  United  States  Treasury
     security per Telerate page 500, or any  successor  page, no later than 3:00
     p.m.,  New York time, on the Bid Date (or such other date and time that may
     be agreed upon by the Company and the  Calculation  Agent) or, if such rate
     does not appear on Telerate page 500, or any successor  page, at such time,
     the rates on GovPx End-of- Day Pricing at 3:00 p.m.,  New York time, on the
     Bid Date (or such  other  date  and  time  that may be  agreed  upon by the
     Company and the Calculation Agent)

          (d) The Calculation  Agent shall provide written notice to the Company
     as soon as practicable on the Bid Date, setting forth (i) the names of each
     of the Dealers from whom the  Calculation  Agent  received  Bids on the Bid
     Date,  (ii) the Bid  submitted  by each such Dealer and (iii) the  Purchase
     Price as determined  pursuant to paragraph  (c) hereof.  Except as provided
     below, the Calculation Agent shall thereafter select from the Bids received
     the Bid with the lowest Yield to Maturity (the "Selected  Bid");  provided,
     however, that if the Calculation Agent has not received a timely Bid from a
     Dealer on or before the Bid Date,  the  Selected Bid shall be the lowest of
     all Bids received by such time; provided further that if any two or more of
     the lowest Bids  submitted  are  equivalent,  the Company shall in its sole
     discretion  select any of such equivalent Bids (and such selected Bid shall
     be the Selected Bid). The Calculation Agent shall set the Coupon Reset Rate
     equal to the interest rate which would amortize the  Debentures  Difference
     fully  over the  term of the  Securities  of this  series  at the  Yield to
     Maturity indicated by the Selected Bid (the "Coupon Reset Rate").

          (e)  Immediately  after  calculating  the  Coupon  Reset  Rate for the
     Securities of this series,  the  Calculation  Agent shall  provide  written
     notice to the  Company and the  Trustee,  setting  forth such Coupon  Reset
     Rate. At the request of the Holders,  the Calculation Agent will provide to
     the Holders the Coupon Reset Rate. The Coupon Reset Rate for the Securities
     of this series will be effective from and including the  Applicable  Coupon
     Reset Date to but  excluding the next  succeeding  Coupon Reset Date, or if
     there are no more Applicable Coupon Reset Dates after the Applicable Coupon
     Reset Date, the Maturity Date.

          (f) The  Callholder  shall sell the  Securities  of this series to the
     Dealer that made the Selected Bid at the  Purchase  Price,  such sale to be
     settled on the Applicable Coupon Reset Date in immediately available funds.

          (g) In the event that the Call Option is terminated in accordance with
     its terms, the Coupon Reset Process shall also terminate.

Optional Redemption

     The Securities of this series are subject to optional redemption,  in whole
but not in  part,  from  time to  time  and at any  time  (such  redemption,  an
"Optional  Redemption",  and the date thereof,  the "Optional  Redemption Date")
upon not less than 30 days' notice to the holders,  at a redemption  price equal
to the  sum of (A)  the  greater  of (i)  100% of the  principal  amount  of the
Securities  of this series to be redeemed or (ii) the sum of the present  values
of  the  Remaining   Scheduled  Payments  thereon  discounted  to  the  Optional
Redemption  Date on a semiannual  basis  (assuming a 360-day year  consisting of
twelve  30-day  months)  at the  Treasury  Rate plus 10 basis  points,  less the
Applicable  Accrued  Interest  Amount plus (B) the Applicable  Accrued  Interest
Amount.

     "Applicable  Accrued  Interest  Amount" means,  at the Optional  Redemption
Date, the amount of interest  accrued and unpaid from the prior interest payment
date to the Optional Redemption Date on the Securities of this series subject to
the  Optional  Redemption  determined  at the rate per annum  shown in the title
thereof, computed on the basis of a 360-day year of twelve 30-day months.

     "Comparable  Treasury  Issue"  means the United  States  Treasury  security
selected by an Independent  Investment Banker as having a maturity that would be
utilized,  at the time of selection and in accordance  with customary  financial
practice,  in pricing new issues of  corporate  debt  securities  of  comparable
maturity to the remaining  term of the  Securities of this series to be redeemed
pursuant to the Optional Redemption.  "Independent  Investment Banker" means one
of the Reference  Treasury Dealers  appointed by the Trustee after  consultation
with the Company.

     "Comparable  Treasury Price" means, with respect to the Optional Redemption
Date, the average of the Reference  Treasury Dealer Quotations for such Optional
Redemption Date.

     "Reference   Treasury   Dealer"   means  each  of  Morgan   Stanley  &  Co.
Incorporated,  Lehman Brothers Inc., and their respective successors;  provided,
however,  that  if  any  of the  foregoing  shall  cease  to be a  primary  U.S.
Government  securities dealer in New York City (a "Primary Treasury Dealer") the
Company will substitute  therefor another Primary  Treasury  Dealer.  "Reference
Treasury  Dealer  Quotations"  means,  with respect to each  Reference  Treasury
Dealer and any redemption  date, the average,  as determined by the Trustee,  of
the bid and asked prices for the Comparable  Treasury  Issue  (expressed in each
case as a percentage of its principal  amount)  quoted in writing to the Trustee
by such  Reference  Treasury  Dealer at 5:00  p.m.  on the  third  Business  Day
preceding such redemption date.

     "Remaining  Scheduled  Payments"  means,  with respect to any Securities of
this series,  the remaining  scheduled  payments of the principal  thereof to be
redeemed  and interest  thereon that would be due after the Optional  Redemption
Date but for the Optional Redemption.

     "Treasury  Rate" means,  with respect to the Optional  Redemption  Date (if
any), the rate per annum equal to the semiannual equivalent yield to maturity of
the Comparable  Treasury  Issue,  assuming a price for the  Comparable  Treasury
Issue  (expressed  as a  percentage  of  its  principal  amount)  equal  to  the
Comparable Treasury Price for such Optional Redemption Date. No Sinking Fund

     The  Securities  of this  series  shall not be  subject  to a sinking  fund
requirement.

Discharge and Defeasance

     The Indenture contains  provisions for defeasance at any time of the entire
indebtedness  of this  Security or certain  restrictive  covenants and Events of
Default  with  respect to this  Security  upon  compliance  by the Company  with
certain conditions set forth in the Indenture.

Events of Default

     If an Event of Default with respect to the  Securities of this series shall
occur and be continuing,  the unpaid  principal of the Securities of this series
may be declared  due and  payable in the manner and with the effect  provided in
the Indenture.

Amendments to Indenture; Waiver of Defaults

     The Indenture  permits,  with certain  exceptions as therein provided,  the
amendment  thereof and the  modification  of the rights and  obligations  of the
Company  and the rights of the  Holders of the  Securities  of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the  Holders of not less than a majority in  principal  amount of the
Securities at the time Outstanding of each series to be affected.  The Indenture
also  contains  provisions  permitting  the Holders of a majority  in  principal
amount of the  Securities of each series at the time  Outstanding,  on behalf of
the Holders of all the  Securities  of such series,  to waive  compliance by the
Company with certain provisions of the Indenture and certain past defaults under
the Indenture and their  consequences.  Any such consent or waiver by the Holder
of this Security  shall be conclusive  and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of  transfer  hereof or in  exchange  hereof or in lieu  hereof,  whether or not
notation of such consent or waiver is made upon this Security.

     As provided in, and subject to, the provisions of the Indenture, the Holder
of this  Security  shall not have any right to  institute  any  proceeding  with
respect to the Indenture or for the  appointment of a receiver or trustee or for
any remedy  thereunder,  unless  such  Holder  shall have  previously  given the
Trustee  written  notice of a  continuing  Event of Default  with respect to the
Securities of this series,  the Holders of not less than 35% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the  Trustee  to  institute  proceedings  in respect of such Event of
Default as Trustee and offered the Trustee  reasonably  satisfactory  indemnity,
and the  Trustee  shall not have  received  from the  Holders of a  majority  in
principal  amount of the  Securities  of this series at the time  Outstanding  a
direction inconsistent with such request, and shall have failed to institute any
such proceeding,  for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder of
this  Security for the  enforcement  of any payment of  principal  hereof or any
premium  or  interest  hereon on or after  the  respective  due dates  expressed
herein.

Obligations Unconditional

     No reference  herein to the  Indenture and no provision of this Security or
of the Indenture  shall alter or impair the obligation of the Company,  which is
absolute and unconditional, to pay the principal of and any premium and interest
on this  Security  at the times,  place and rate,  and in the coin or  currency,
herein prescribed.

Transfer and Exchange

     As provided in the Indenture and subject to certain limitations therein set
forth,  the transfer of this Security is registrable  in the Security  Register,
upon  surrender of this Security for  registration  of transfer at the office or
agency of the  Company in any place where the  principal  of and any premium and
interest on this  Security are payable,  duly endorsed by, or  accompanied  by a
written  instrument  of  transfer  in form  satisfactory  to the Company and the
Security  Registrar  duly  executed by, the Holder  hereof or its attorney  duly
authorized in writing,  and thereupon one or more new Securities of this series,
and of like tenor, of authorized denominations and for the same aggregate unpaid
principal amount, shall be issued to the designated transferee or transferees.

     The Securities of this series are issuable only in registered  form without
coupons  in  denominations  of $1,000  and any  integral  multiple  thereof.  As
provided in the Indenture and subject to certain  limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of  Securities  of this  series  and of like  tenor  of a  different  authorized
denomination, as requested by the Holder surrendering the same.

     No service  charge shall be made for any such  registration  of transfer or
exchange,  but the Company may require  payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith. Holders

     Prior to due presentment of this Security for registration of transfer, the
Company,  the  Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this  Security is  registered  as the owner  hereof for all
purposes,  whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.

CUSIP Number

     Pursuant  to a  recommendation  promulgated  by the  Committee  on  Uniform
Security Identification  Procedures, the Company has caused a CUSIP number to be
printed  on  this  Security  as  a  convenience   to  the  Holder   hereof.   No
representation  is made as to the  accuracy of such number and  reliance  may be
placed only on the other identifying information printed hereon.

Governing Law

     The  Indenture  and this  Security  shall be governed by and  construed  in
accordance with the laws of the State of New York.