Executed in 120 Counterparts
                             No. 12


                                SUPPLEMENTAL INDENTURE



                                Dated January 15, 1996

                                    ______________


                              KENTUCKY UTILITIES COMPANY

                                          TO


                    FIRST TRUST OF ILLINOIS, NATIONAL ASSOCIATION
                                AND FRANK SGARAGLINO,
                                     AS TRUSTEES


                                    ______________



             (SUPPLEMENTAL TO THE INDENTURE OF MORTGAGE OR DEED OF TRUST
                 DATED MAY 1, 1947, AS AMENDED, HERETOFORE EXECUTED BY
             KENTUCKY UTILITIES COMPANY TO CONTINENTAL ILLINOIS NATIONAL
                          BANK AND TRUST COMPANY OF CHICAGO
                         AND EDMOND B. STOFFT, AS TRUSTEES.)


                                    _____________



                        (PROVIDING FOR FIRST MORTGAGE BONDS,
                           SERIES S, DUE January 15, 2006)

                                       -49-
<PAGE>


                 THIS SUPPLEMENTAL  INDENTURE,  dated  January  15,  1996
             made  and entered  into  by and  between KENTUCKY  UTILITIES
             COMPANY, a corporation organized and existing under the laws
             of the Commonwealths  of Kentucky and  Virginia (hereinafter
             commonly  referred to as the "Company"),  and FIRST TRUST OF
             ILLINOIS,   NATIONAL   ASSOCIATION,   a   national   banking
             association having its  office or place  of business in  the
             City of  Chicago, Cook County, State  of Illinois, successor
             to  Bank of  America  Illinois, formerly  named  Continental
             Bank, National Association and Continental Illinois National
             Bank  and  Trust Company  of  Chicago (hereinafter  commonly
             referred  to  as   the  "Trustee"),  and  FRANK   SGARAGLINO
             (successor Co-Trustee), of the City of Chicago, Cook County,
             State  of  Illinois,  as  Trustees under  the  Indenture  of
             Mortgage or Deed of Trust dated May 1, 1947, as modified and
             amended  by  the  several  indentures  supplemental  thereto
             heretofore  executed  by and  between  the  Company and  the
             Trustees from time to time under said  Indenture of Mortgage
             or  Deed of  Trust; said  Indenture of  Mortgage or  Deed of
             Trust,  as   so  modified  and  amended,  being  hereinafter
             commonly referred  to as the "Indenture";  and said Trustees
             under the  Indenture being hereinafter commonly  referred to
             as  the "Trustees"  or the  "Trustees under  the Indenture";
             Witnesseth:

                 WHEREAS,  the Company,  by resolution  of its  Board  of
             Directors and  the Pricing  Committee thereof duly  adopted,
             has determined  to issue  forthwith an additional  series of
             its bonds to be secured by the Indenture, as hereby modified
             and  amended, such bonds to be known and designated as First
             Mortgage Bonds, Series S  (hereinafter sometimes referred to
             as the "bonds of  Series S" or the "bonds of  said Series"),
             and  to  be authorized,  authenticated  and  issued only  as
             registered bonds without coupons; and

                 WHEREAS,  the Company  desires, in  accordance with  the
             provisions of Article I, as hereby amended, Section 6(e)  of
             Article II and Article XVI of the Indenture, to execute this
             supplemental indenture  for  the  purpose  of  creating  and
             authorizing the bonds of Series S  and modifying or amending
             certain provisions  of the Indenture in  the particulars and
             to the  extent  hereinafter in  this supplemental  indenture
             specifically provided; and

                 WHEREAS, the  execution and delivery  by the Company  of
             this supplemental indenture have been duly authorized by the
             Board of  Directors of the Company and the Pricing Committee
             thereof; and the Company has requested, and hereby requests,
             the Trustees to enter into and join with  the Company in the
             execution and delivery of this supplemental indenture; and



                                         -50-
<PAGE>


                 WHEREAS, the  bonds of  Series S  are to  be authorized,
             authenticated  and issued  only  in the  form of  registered
             bonds  without  coupons, and  each  of  such bonds  and  the
             certificate of the Trustee thereon shall be substantially in
             the following form, to wit:

                              (Form of bond of Series S)


             No. . . . . .                                $. . . . . . .

                              Kentucky Utilities Company
                            First Mortgage Bond, Series S

             Original
               Issue           Dated           Maturity
               Date            Date              Date            CUSIP

              January 24,      January 15,      January 15,
                  1996            1996              2006



                             Interest
             Interest         Payment           Record
               Rate            Dates            Dates

              5.99%             July 15            July 1
                             January 15         January 1



             REGISTERED OWNER ___________________________________


             PRINCIPAL     AMOUNT    ____________________________________
             DOLLARS


                 Unless  this certificate  is presented by  an authorized
             representative of  The Depository Trust Company,  a New York
             corporation  ("DTC"),  to  the  Company  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.


                                          -51-
<PAGE>


                 Kentucky Utilities  Company,  a  Kentucky  and  Virginia
             corporation (hereinafter referred to as the "Company"),  for
             value  received, hereby  promises to  pay to  the Registered
             Owner specified above  or registered assigns,  the Principal
             Amount specified above on the Maturity Date specified above,
             and to pay to the Registered Owner interest on said sum from
             the  Dated  Date  specified  above,  at  the  Interest  Rate
             specified above, payable half-yearly on the Interest Payment
             Dates  specified above,  until said  principal sum  is paid.
             The interest  so payable on any Interest  Payment Dates will
             be  paid,  subject to  certain  exceptions  provided in  the
             Supplemental  Indenture dated January  15, 1996, hereinafter
             referred  to,  to  the  Registered  Owner at  the  close  of
             business of the Trustee  on the immediately preceding Record
             Date.  Both  the principal of and the interest  on this bond
             shall be payable at the  office or agency of the Company  in
             the  City  of Chicago,  State of  Illinois,  in any  coin or
             currency of the United  States of America which at  the time
             of payment is legal tender for public and private debts, or,
             at  the  option of  the Registered  Owner,  in like  coin or
             currency,  at the  office or  agency of  the Company  in the
             Borough of Manhattan, City  of New York, State of  New York.
             At the option of the Company, interest on this bond shall be
             payable  by check mailed on the Interest Payment Date to the
             Registered Owner hereof.

                 EXCEPT UNDER THE LIMITED CIRCUMSTANCES  DESCRIBED IN THE
             INDENTURE, THIS GLOBAL BOND MAY NOT BE TRANSFERRED EXCEPT AS
             A  WHOLE BY THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY
             TO  THE DEPOSITARY,  ANOTHER  NOMINEE OF  THE DEPOSITARY,  A
             SUCCESSOR OF THE DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR.

                 This bond is  one of the bonds of the Company issued and
             to be issued from time to time under and in accordance  with
             and  all secured  by the  indenture of  mortgage or  deed of
             trust dated  May  1, 1947,  executed  and delivered  by  the
             Company  to First  Trust  of Illinois,  National Association
             (successor to Bank of America Illinois, formerly Continental
             Bank, National Association and Continental Illinois National
             Bank and Trust Company  of Chicago) (hereinafter referred to
             as the "Trustee") and Edmond B. Stofft, as Trustees, and the
             various  indentures supplemental  thereto each  executed and
             delivered  by   the  Company  to  the   Trustees  (including
             Successor  Co-Trustees)  under  said indenture  of  mortgage
             (said indenture of mortgage and said supplemental indentures
             being   hereinafter  referred   to,  collectively,   as  the
             "Indenture").    Reference  to  the  Indenture  and  to  all
             supplemental indentures, if any, hereafter executed pursuant
             to the Indenture  is hereby  made for a  description of  the
             property mortgaged and pledged, the nature and extent of the
             security and the rights of the holders and Registered Owners
             of  said bonds  and of  the Trustees  and of the  Company in

                                         -52-
<PAGE>


             respect of such security.  By the terms of the Indenture the
             bonds to be secured thereby are issuable in series which may
             vary as to date, amount, date of maturity, rate of interest,
             redemption  provisions,  medium  of  payment  and  in  other
             respects as in the Indenture provided. Bonds of Series S are
             not subject to redemption prior to maturity.

                 In case  of certain events of  default specified in  the
             Indenture, the principal of this bond may be declared or may
             become due and  payable in  the manner and  with the  effect
             provided in the Indenture.  No recourse shall be had for the
             payment of the principal of or interest on this bond, or for
             any claim based hereon, or otherwise in respect hereof or of
             the Indenture  or any indenture supplemental  thereto, to or
             against any incorporator, stockholder, officer  or director,
             past,  present  or   future,  of  the  Company,  or  of  any
             predecessor  or successor  corporation,  either directly  or
             through   the  Company  or  such  predecessor  or  successor
             corporation, under  any constitution  or statute or  rule of
             law,  or by the enforcement of any assessment or penalty, or
             otherwise,    all    such   liability    of   incorporators,
             stockholders,   directors  and  officers  being  waived  and
             released by the Registered Owner hereof by the acceptance of
             this  bond and  being likewise  waived  and released  by the
             terms  of the Indenture.   This bond is  transferable by the
             Registered  Owner  hereof, in  person  or  by attorney  duly
             authorized, at the principal office or place  of business of
             the  Trustee under  the  Indenture, upon  the surrender  and
             cancellation of this bond  and the payment of any  stamp tax
             or other governmental  charge, and upon any  such transfer a
             new registered bond  or bonds without  coupons, of the  same
             series and for the same aggregate principal amount,  will be
             issued to the transferee in exchange herefor; provided, that
             the  Company shall not be  required to transfer, exchange or
             register bonds of Series S during the 10 days next preceding
             an Interest Payment Date.

                 This bond shall  not be valid  or become  obligatory for
             any   purpose  unless   and   until  it   shall  have   been
             authenticated  by  the  execution  by  the  Trustee  or  its
             successor  in trust  under  the Indenture  of the  Trustee's
             Certificate endorsed hereon.








                                         -53-
<PAGE>


                 IN  WITNESS  WHEREOF,  Kentucky  Utilities  Company  has
             caused this bond to be executed in its name by the manual or
             facsimile  signature of  its President  or one  of its  Vice
             Presidents, and its corporate seal or a facsimile thereof to
             be hereto  affixed or imprinted  hereon and attested  by the
             manual or facsimile signature of its Secretary or one of its
             Assistant Secretaries.


                         KENTUCKY UTILITIES COMPANY


                         By ___________________________
                                  President
             ATTEST:

             _________________________
                   Secretary

               This  bond is one  of the  bonds of  the series designated
             therein, described in the within mentioned Indenture.

                                     FIRST TRUST OF ILLINOIS, NATIONAL
                                             ASSOCIATION
                                       as Trustee

                                     By _______________________________
                                          Authorized Officer

                          (End of form of bond of Series S)



                 NOW, THEREFORE, in consideration of the premises and  of
             the sum  of One Dollar ($1.00)  duly paid by  the Trustee to
             the Company, and of  other good and valuable considerations,
             the  receipt whereof  is  hereby acknowledged,  and for  the
             purpose  of  further  assuring  to the  Trustees  under  the
             Indenture  their  title  to,  or  lien  upon,  the  property
             hereinafter described,  under and  pursuant to the  terms of
             the Indenture  and for the  purpose of further  securing the
             due  and punctual payment  of the principal  of and interest
             and  the premium,  if  any, on  all  bonds which  have  been
             heretofore or shall be  hereafter issued under the Indenture
             and indentures  supplemental thereto  and which shall  be at
             any time outstanding thereunder and secured thereby, and for
             the  purpose  of  securing  the   faithful  performance  and
             observance of all the covenants  and conditions set forth in
             the Indenture and/or in any indenture  supplemental thereto,
             the  Company has  given,  granted,  bargained, sold,  trans-
             ferred, assigned, pledged, mortgaged, warranted the title to
             and  conveyed,  and  by  these presents  does  give,  grant,

                                          -54-
<PAGE>


             bargain, sell, transfer,  assign, pledge, mortgage,  warrant
             the  title  to  and convey  unto  FIRST  TRUST  OF ILLINOIS,
             NATIONAL ASSOCIATION and FRANK SGARAGLINO, as Trustees under
             the Indenture as therein provided, and the successors in the
             trusts thereby created, and to their assigns, all the right,
             title  and interest  of the Company  in and  to any  and all
             premises,   plants,   property,   leases   and   leaseholds,
             franchises, permits,  rights and  powers, of every  kind and
             description, real and personal  (1) which have been acquired
             by the Company through construction, purchase, consolidation
             or  merger, or otherwise, and  which at the  date hereof are
             owned by the Company, and (2) which shall be acquired by the
             Company,  through   construction,  purchase,  consolidation,
             merger,  or otherwise, on or subsequent  to the date hereof,
             together, in each case, with the rents, issues, products and
             profits therefrom,  excepting, however, and  there is hereby
             expressly reserved and excluded from  the lien and effect of
             the Indenture and of this supplemental indenture, all right,
             title and  interest of the Company, now  owned, or hereafter
             acquired,  in and to (a)  all cash, bonds,  shares of stock,
             obligations and  other  securities not  deposited  with  the
             Trustee  or  Trustees  under  the  Indenture,  and  (b)  all
             accounts and bills receivable, judgments (other than for the
             recovery of real  property or establishing a lien  or charge
             thereon  or   right  therein)  and  choses   in  action  not
             specifically  assigned to  and pledged  with the  Trustee or
             Trustees  under  the  Indenture,   and  (c)  all  lamps  and
             supplies, machinery, appliances, goods,  wares, merchandise,
             commodities, equipment, apparatus, materials and/or supplies
             acquired or held by  the Company for sale, lease,  rental or
             consumption in the ordinary course of  business, and (d) the
             last day of each  of the demised terms created by  any lease
             of property leased to  the Company and under each  and every
             renewal of any such  lease, the last  day of each and  every
             such demised term being hereby  expressly reserved to and by
             the Company, and  (e) all  gas, oil, ore,  copper and  other
             minerals now or hereafter existing upon, within or under any
             real estate of the  Company subject to, or hereby  subjected
             to, the lien of the Indenture.

                 Without  in  any   way  limiting   or  restricting   the
             generality of  the  foregoing description  or the  foregoing
             exceptions  and reservations,  the Company  hereby expressly
             gives, grants, bargains, sells, transfers, assigns, pledges,
             mortgages, warrants the title to and conveys unto said FIRST
             TRUST   OF  ILLINOIS,   NATIONAL   ASSOCIATION   and   FRANK
             SGARAGLINO, as Trustees under  the Indenture, and unto their
             successor or  successors in trust, and  their assigns, under
             the  trusts and for the purposes of the Indenture, as hereby
             amended, the  properties described  in Section 5  of Article
             III of  this supplemental indenture  (said description being
             incorporated  herein by  reference with  the same  force and

                                        -55-
<PAGE>


             effect  as  if  set  forth  at  length  herein),  and  which
             properties  have  been  acquired  by  the  Company,  through
             construction,   purchase,   consolidation   or  merger,   or
             otherwise, and which are owned by the Company at the date of
             the   execution   hereof   together  with   the   tenements,
             hereditaments  and  appurtenances  thereunto   belonging  or
             appertaining.

                 TO  HAVE  AND  TO HOLD  all  said  property, rights  and
             interests hereinabove described or referred to and conveyed,
             assigned, pledged or mortgaged,  or intended to be conveyed,
             assigned,  pledged  or mortgaged,  together with  the rents,
             issues, products and profits therefrom unto said FIRST TRUST
             OF  ILLINOIS, NATIONAL ASSOCIATION  and FRANK SGARAGLINO, as
             Trustees  under  the  Indenture,   as  hereby  modified  and
             amended,  and unto  their successor  or successors  in trust
             forever, BUT  IN TRUST,  NEVERTHELESS, upon the  trusts, for
             the  purposes  and subject  to  all  the terms,  conditions,
             provisions  and  restrictions of  the  Indenture,  as hereby
             modified and amended.

                 And  upon  the  considerations  and  for  the   purposes
             aforesaid, and in order to provide, pursuant to the terms of
             the  Indenture, for  the  issuance under  the Indenture,  as
             hereby modified and amended, of bonds of Series S and to fix
             the terms,  provisions and  characteristics of the  bonds of
             said  Series, and to modify  and amend the  Indenture in the
             particulars  and   to   the  extent   hereinafter  in   this
             supplemental  indenture  specifically provided,  the Company
             hereby covenants and agrees with the Trustees as follows:

                                      ARTICLE I

                 Section  1.   A  series  of  bonds  issuable  under  the
             Indenture, as hereby  modified and amended, and  to be known
             and designated as "First  Mortgage Bonds, Series S" (herein-
             after in this Article sometimes referred to as the "bonds of
             Series S" or as the "bonds of said Series"), and which shall
             be executed,  authenticated and issued  only in the  form of
             registered  bonds  without coupons,  is  hereby  created and
             authorized.  The bonds of said Series shall be substantially
             in the form thereof hereinbefore recited.  If so directed by
             the Company, the  bonds of  Series S  shall be  issued as  a
             single  global  security  for  each  maturity  thereof   and
             registered  in the name  of The Depository  Trust Company or
             its  nominee or  successor under a  "book-entry-only" system
             pursuant to  a letter of representation  between the Company
             and  the Trustee  and said  depository.   Each bond  of said
             Series  shall  be  dated as  of  the  Interest Payment  Date
             thereof  to which interest was paid  next preceding the date
             of  issue, unless  (a) issued  on  an Interest  Payment Date
             thereof  to which interest was paid, in which event it shall

                                        -56-
<PAGE>


             be dated as of the date of issue, or (b) issued prior to the
             occurrence  of the  first Interest  Payment Date  thereof to
             which  interest was paid, in  which event it  shall be dated
             the Dated  Date; and the bonds  of said Series shall  be due
             and payable  on the  Maturity Date hereinabove  specified in
             the  form of bond, shall bear interest from the date thereof
             at  the Interest  Rate per  annum specified  in the  form of
             bond,  payable half-yearly  on  the  Interest Payment  Dates
             specified in the form of bond in each year to the Registered
             Owners  as specified on the registry books of the Trustee on
             the  close of  business  on the  applicable  Record Date  as
             hereinafter provided; shall be  payable both as to principal
             and interest,  at the office or agency of the Company in the
             City  of Chicago, State of Illinois, in any coin or currency
             of the United States of America which at the time of payment
             is  legal tender  for public  and private  debts, or  at the
             option of the Registered Owner, in like coin or currency, at
             the  office or  agency  of the  Company  in the  Borough  of
             Manhattan, City of  New York, State of New York; and, at the
             option  of the Company, shall  be payable as  to interest by
             check mailed on the Interest  Payment Date to the Registered
             Owner thereof.  So  long as any "book-entry-only"  system is
             in  effect,  the  bonds of  said  Series  shall  be paid  as
             provided in the letter of representation referred to above.

                 Anything contained  in Section  14 of Article  I of  the
             Indenture (or  elsewhere in  the Indenture) to  the contrary
             notwithstanding, only the  person in whose  name any of  the
             bonds of  Series S is registered (the "Registered Owner") at
             the close  of business  on any  Record Date  (as hereinafter
             defined) with respect to any Interest  Payment Date shall be
             entitled to  receive the  interest payable on  such Interest
             Payment Date notwithstanding the cancellation  of such bonds
             upon any transfer  or exchange subsequent to the Record Date
             and prior to such  Interest Payment Date; provided, however,
             that  if and to the extent the  Company shall default in the
             payment of  the interest due on such  Interest Payment Date,
             such defaulted  interest shall  be paid  to  the persons  in
             whose names outstanding bonds  of said Series are registered
             on the record  date to  be established by  the Trustees  for
             payment of such defaulted interest.

                 The term  "Record Date" as used  in this  Article I with
             respect to any Interest Payment Date applicable to the bonds
             of  said Series (other than an Interest Payment Date for the
             payment of  defaulted interest)  shall  mean the  applicable
             Record  Date specified  in the  form of bond  next preceding
             such Interest Payment Date, or, if such Record Date shall be
             a  legal holiday or a  day on which  banking institutions in
             the City of Chicago, Illinois, or the Borough  of Manhattan,
             City of New York,  State of New York, are  authorized by law
             to close, then the next preceding  day which shall not be  a

                                        -57-
<PAGE>


             legal holiday or  a day  on which such  institutions are  so
             authorized to close.

                 The  bonds  of Series  S are  not subject  to redemption
             prior to maturity.

                 Section 2.   The bonds of  said Series  shall, from time
             to time, be  executed on  behalf of the  Company and  sealed
             with  the corporate seal of  the Company, all  in the manner
             provided in or  permitted by Section 6  of Article I of  the
             Indenture, as follows:

                 (a)  bonds  of said  Series executed  on  behalf of  the
             Company  by its  President or  a Vice  President and  by its
             Secretary  or an Assistant  Secretary may be  so executed by
             the manual or  facsimile signature of such President or Vice
             President and  of such Secretary or  Assistant Secretary, as
             the case may be, of the Company, or of any person or persons
             who  shall have been such  officer or officers,  as the case
             may be, of the Company on  or subsequent to the date of this
             supplemental indenture, notwithstanding that he or  they may
             have ceased to be such officer or officers of the Company at
             the time  of the actual  execution, authentication, issuance
             or  delivery of  any of such  bonds of said  Series, and any
             such  manual or  facsimile signature  or signatures  of such
             officer or officers of the Company as above provided, on any
             such  bonds  shall constitute  execution  of  such bonds  on
             behalf of the  Company by  such officer or  officers of  the
             Company  for  the  purposes  of  the  Indenture,  as  hereby
             modified and amended,  and shall be valid  and effective for
             all purposes provided  that all bonds  of said Series  shall
             always be executed on behalf of the Company by the manual or
             facsimile signature of its President or a Vice President and
             of  its  Secretary  or  an  Assistant  Secretary,  as  above
             provided,  and provided,  further, that  none of  such bonds
             shall be executed on  behalf of the Company by the manual or
             facsimile signature of the same officer or person acting  in
             more than one capacity; and

                 (b)  such   corporate  seal  of   the  Company  may   be
             facsimile, and  any  bonds  of  said Series  on  which  such
             facsimile seal  of the Company shall  be affixed, impressed,
             imprinted or reproduced  shall be deemed  to be sealed  with
             the corporate seal  of the  Company for the  purpose of  the
             Indenture,  as   hereby  modified  and  amended,   and  such
             facsimile  seal  shall  be   valid  and  effective  for  all
             purposes.

                 The Company shall not be required to transfer,  exchange
             or register bonds  of said  Series during the  10 days  next
             preceding an Interest Payment Date.


                                         -58-
<PAGE>


                 Section 3.  (a)  Except  as provided in subsections  (c)
             and (g)  below, the holder of  all of the  bonds of Series S
             shall be The Depository Trust  Company ("DTC") and the bonds
             of said Series shall  be registered  in the  name of  Cede &
             Co., as nominee for DTC.

                 (b)     The bonds  of Series S shall be initially issued
             in  the  form of  a  single  authenticated fully  registered
             certificate in the name  of Cede & Co. and in  the principal
             amount of the  bonds of  Series S (a "Global  Bond").   Upon
             initial issuance, the ownership of such bonds of said Series
             shall be registered in the bond register kept by the Trustee
             in the name  of Cede & Co., as nominee  of DTC.  So  long as
             the bonds of said Series are evidenced by a Global Bond, the
             Trustee  and the Company may  treat DTC (or  its nominee) as
             the  sole  and exclusive  holder  of the  bonds  of Series S
             registered  in its name for  the purposes of  payment of the
             principal  of, premium, if any, and interest on the bonds of
             said Series or portion thereof to be redeemed, and of giving
             any notice  permitted or  required to  be  given to  holders
             under the Indenture and neither  the Trustee nor the Company
             shall  be affected  by  any notice  to  the contrary.    The
             Trustee shall  pay all principal  of, premium,  if any,  and
             interest  on the bonds of Series S registered in the name of
             Cede & Co. only to or "upon the order of" DTC  (as that term
             is  used  in  the  Uniform Commercial  Code  as  adopted  in
             Illinois and New York), and all such payments shall be valid
             and effective  to fully satisfy and  discharge the Company's
             obligations with  respect to  the principal of,  premium, if
             any, and interest on such bonds of said Series to the extent
             of the sum or sums so paid.  Except as otherwise provided in
             Section 3(c)  and (g) below, no person  other than DTC shall
             receive  authenticated  bond  certificates   evidencing  the
             obligation of the  Company to make payments of principal of,
             premium, if any, and  interest on the bonds of  said Series.
             Upon delivery by DTC to the Trustee of written notice to the
             effect that  DTC has determined to substitute  a new nominee
             in place of Cede & Co., and subject to  the provision of the
             Indenture  with  respect to  transfers  of  bonds, the  word
             "Cede & Co."  in this supplemental indenture  shall refer to
             such new nominee of DTC.

                 (c)     Any Global Bond shall be exchangeable for  bonds
             of Series S in certificated form  registered in the names of
             Participants and/or  Beneficial Owners if, but  only if, (i)
             DTC notifies the Company  that it is unwilling or  unable to
             continue  as depository for bonds  of said Series  or at any
             time ceases to be a clearing agency registered as such under
             the Securities  Exchange Act  of 1934, as  amended, (ii) the
             Company instructs the Trustee that such Global Bond shall be
             exchangeable  or  (iii) there  shall  have  occurred  and be
             continuing  an event of default or an event that with notice

                                         -59-
<PAGE>


             or  passage of time, or  both, would constitute  an event of
             default.    In  any such  event,  the  Trustee  shall issue,
             transfer and exchange bond  certificates as requested by DTC
             in  appropriate  amounts  pursuant   to  Article  I  of  the
             Indenture and  Section 1 of  Article I of  this supplemental
             indenture.   The Company  shall pay all  costs in connection
             with  the production,  execution and  delivery of  such bond
             certificates.     If  bond  certificates  are   issued,  the
             provisions  of the  Indenture  shall apply  to, among  other
             things, the  transfer and exchange of  such certificates and
             the method of payment and principal of, premium, if any, and
             interest on such certificates.

                 (d)     Notwithstanding  any  other  provision  of  this
             supplemental indenture to the contrary, so long as any bonds
             of  Series S are evidenced  by a Global  Bond, registered in
             the name of Cede & Co., as nominee of DTC, all payments with
             respect to the principal of,  premium, if any, and  interest
             on the bonds  of said Series and all notices with respect to
             the  bonds  of  said   Series  shall  be  made  and   given,
             respectively,  to  DTC  as  provided  in the  representation
             letter relating to the  bonds of said Series among  DTC, the
             Trustee  and the Company.  The  Trustee is hereby authorized
             and  directed to comply with all terms of the representation
             letter.

                 (e)     In   connection   with   any  notice   or  other
             communication to  be provided pursuant to  the Indenture for
             the bonds  of Series S  by the Company  or the Trustee  with
             respect to any  consent or other action  to be taken  by the
             holders  of the  bonds of  said Series,  the Company  or the
             Trustee,  as  the case  may be,  shall  seek to  establish a
             record date  to the  extent permitted by  the Indenture  for
             such consent or  other action  and give DTC  notice of  such
             record  date not  less than  fifteen (15)  calendar days  in
             advance  of such record date  to the extent  possible.  Such
             notice  to DTC  shall be  given only  when DTC  is the  sole
             holder.

                 (f)     NEITHER  THE TRUSTEE NOR  THE COMPANY SHALL HAVE
             ANY   RESPONSIBILITY   OR   OBLIGATION  TO   ANY   OF  DTC'S
             PARTICIPANTS (EACH, A "PARTICIPANT"), ANY PERSON  CLAIMING A
             BENEFICIAL  OWNERSHIP  IN THE  BONDS  OF SERIES  S  UNDER OR
             THROUGH DTC OR ANY PARTICIPANT (EACH, A "BENEFICIAL OWNER"),
             OR ANY OTHER PERSON WHICH IS NOT SHOWN ON THE BOND  REGISTER
             MAINTAINED BY THE TRUSTEE AS BEING A HOLDER, WITH RESPECT TO
             (i) THE ACCURACY  OF ANY  RECORDS MAINTAINED BY  DTC OR  ANY
             PARTICIPANT; (ii) THE  PAYMENT BY DTC OR  ANY PARTICIPANT OF
             ANY  AMOUNT IN RESPECT OF THE PRINCIPAL OF, PREMIUM, IF ANY,
             OR  INTEREST ON THE BONDS  OF SAID SERIES;  (iii) ANY NOTICE
             WHICH  IS PERMITTED OR REQUIRED TO BE GIVEN TO HOLDERS UNDER
             THE INDENTURE OF BONDS OF SAID SERIES; (iv) THE SELECTION BY

                                         -60-
<PAGE>


             DTC OR ANY PARTICIPANT  OF ANY PERSON TO RECEIVE  PAYMENT IN
             THE  EVENT OF A PARTIAL REDEMPTION OF THE BONDS OF SERIES S;
             OR (v) ANY  CONSENT GIVEN  OR OTHER ACTION  TAKEN BY DTC  AS
             BONDHOLDER.

                 SO LONG AS CEDE  & CO. IS  THE REGISTERED HOLDER OF  THE
             BONDS OF SERIES S  AS NOMINEE OF  DTC, REFERENCES HEREIN  TO
             THE  BONDS OF SAID SERIES OR REGISTERED HOLDERS OF THE BONDS
             OF SAID  SERIES SHALL MEAN CEDE & CO. AND SHALL NOT MEAN THE
             BENEFICIAL  OWNERS OF  THE  BONDS  OF  SAID SERIES  NOR  DTC
             PARTICIPANTS.

                 (g)     No Global  Bond may be  transferred except as  a
             whole by DTC to a nominee  of DTC or by a nominee of  DTC to
             DTC or  another nominee of DTC or by DTC or any such nominee
             to a successor of DTC or a nominee of such successor.

                 (h)     Upon  the termination  of  the  services of  DTC
             with respect to the bonds of Series S pursuant to subsection
             (c) of this Section  3 after which no substitute  book-entry
             depository is appointed,  the bonds of said  Series shall be
             registered in whatever name or names holders transferring or
             exchanging  bonds   of  said  Series   shall  designate   in
             accordance with the provisions of the Indenture.

                                      ARTICLE II

                 Section 1.  Section  10 of Article III  and Section 1 of
             Article VII  of the  Indenture are  each  hereby amended  to
             provide that the Company covenants and agrees to observe and
             comply with the  provisions of said  sections as so  amended
             hereby so long  as the  bonds of Series  S are  outstanding.
             The bonds  outstanding  on the  date  hereof to  which  said
             Section 10 applies  are Series K, Nos. 7,  8, Series P, Nos.
             1B, 2B, 3B and 4B,  Series Q, Nos. 9  and 10 and Series R.
             The bonds  outstanding  on the  date  hereof to  which  said
             Section 1 applies are Series K, P, Q and R.

                                     ARTICLE III

                 Section   1.    The  provisions   of  this  supplemental
             indenture shall  be effective  from and after  the execution
             hereof; and  the Indenture, as hereby  modified and amended,
             shall remain in full force and effect.

                 Section 2.   Each holder or  registered owner  of a bond
             of   any  series   not  now   outstanding  which   shall  be
             authenticated by the Trustee and issued by the Company under
             the   Indenture  (as  hereby   amended)  subsequent  to  the
             execution of  this supplemental indenture and  of any coupon
             pertaining  to any such bond, by the acquisition, holding or
             ownership  of such  bond  and coupon,  thereby consents  and

                                         -61-
<PAGE>


             agrees to, and  shall be  bound by, the  provisions of  this
             supplemental indenture.

                 Section 3.  Each reference in  the Indenture, or in this
             supplemental  indenture,  to any  article, section,  term or
             provision of the Indenture shall mean and be deemed to refer
             to  such   article,  section,  term  or   provision  of  the
             Indenture, as hereby modified  and amended, except where the
             context otherwise indicates.

                 Section 4.  All  the covenants, provisions, stipulations
             and agreements in this supplemental  indenture contained are
             and  shall  be for  the sole  and  exclusive benefit  of the
             parties  hereto, their  successors and  assigns, and  of the
             holders and registered owners from time to time of the bonds
             and  of the coupons issued and outstanding from time to time
             under and secured  by the Indenture, as  hereby modified and
             amended.

                 This supplemental  indenture  has  been  executed  in  a
             number of identical counterparts,  each of which so executed
             shall be deemed to be an original.

                 At  the  time of  the  execution  of  this  supplemental
             indenture,   the   aggregate   principal   amount   of   all
             indebtedness  outstanding, or  to be  presently outstanding,
             under and secured by the  Indenture, as hereby modified  and
             amended,  is $580,130,000, consisting  of and represented by
             First Mortgage Bonds of the Company of the following series:

                    Interest       Maturity                  Principal
             Series   Rate           Date                      Amount

              K      7 3/8         December 1, 2002        $35,500,000(a)
              No. 7  7 3/8         May 1, 2010               4,000,000
                     7.60          May 1, 2020               8,900,000
              No. 8  7.45          September 15, 2016       96,000,000
              P      7.92          May 15, 2007             53,000,000
                     8.55          May 15, 2027             33,000,000
              No. 1B 6 1/4         February 1, 2018         20,930,000
              No. 2B 6 1/4         February 1, 2018          2,400,000
              No. 3B 6 1/4         February 1, 2018          7,200,000
              No. 4B 6 1/4         February 1, 2018          7,400,000
              Q      5.95          June 15, 2000            61,500,000
                     6.32          June 15, 2003            62,000,000
              No. 9  5 3/4         December 1, 2023         50,000,000
              No. 10 Variable      November 1, 2024         52,300,000(b)
              R      7.55          June 1, 2025             50,000,000
              S      (c)           January 15, 2006         36,000,000(d)

             _________


                                         -62-
<PAGE>

             (a)    To  be paid  and  discharged  not more  than 90  days
                    after issuance of Series S.

             (b)    An  additional $1,700,000  remains  authorized  to be
                    issued.

             (c)    At the Interest Rate specified in the form of bond.

             (d)    To  be presently  issued  by the  Company  under  the
                    Indenture, as hereby modified and amended.

                 All  of said bonds of  Series K, Series  P, Series Q and
             Series R, respectively,  were sold  by the  Company to,  and
             upon  the  issue  thereof  were  owned  and  held   by,  the
             corporations and partnerships whose names and residences are
             stated  in the  Supplemental  Indentures dated  December  1,
             1972, May 15, 1992, June 15, 1993 and June 1,  1995, respec-
             tively, executed by the Company  to the Trustees under  said
             Indenture as heretofore modified and amended.

                 All of said bonds of Series No. 7  and Series No. 8 were
             heretofore issued,  and upon the issuance  thereof were held
             by,  First Security  National  Bank and  Trust Company,  One
             First  Security Plaza,  Lexington, Fayette  County, Kentucky
             40507,  as trustee  (now succeeded  by Bank  One, Lexington,
             N.A.).

                 All  of  said  bonds   of  Series  No.   1B  through  4B
             inclusive, Series  No. 9 and  Series No. 10  were heretofore
             issued  and  delivered  by  the Company  to,  and  upon  the
             issuance thereof  were held  by, Bank One,  Lexington, N.A.,
             201  East Main  Street, Lexington, Fayette  County, Kentucky
             40507, as trustee.

                 The   Thirty-Six   Million  Dollars   ($36,000,000)   in
             principal  amount  of  bonds  of  Series S  proposed  to  be
             presently  issued by  the  Company under  the Indenture,  as
             hereby modified  and amended, are to be issued and delivered
             by the Company  to, and  upon the issuance  thereof will  be
             owned by, Goldman, Sachs  & Co., 85 Broad Street,  New York,
             New York  and J.J.B. Hilliard,  W.L. Lyons, Inc.,  501 South
             Fourth Avenue, Louisville, Kentucky.

                 Section 5.  The Company hereby gives, grants,  bargains,
             sells, transfers, assigns, pledges, mortgages,  warrants the
             title to  and conveys unto the Trustee  under the Indenture,
             upon  the trusts and for  the purposes of  the Indenture, as
             hereby modified, the following described properties:

               FIRST: The  following described  electric substations  and
             switching stations of the Company located in Kentucky:


                                         -63-
<PAGE>


                    Item   1:   The  69   kV   switching   station   near
               Madisonville in Hopkins County.

                    Item 2:  The 69 kV  switching station near  Pineville
               in Harlan County.

               SECOND:  The  following  described  electric  transmission
             lines of the Company located in Kentucky:

                    Item 1.  The 138  kV single  circuit steel  pole line
               extending  from  the  Ghent/Kenton   line  to  the  Butler
               Substation near Butler in Pendleton County.

                    Item 2.  The  69  kV single  circuit wood  pole  line
               extending  from the  Boyle  County/Lancaster line  to  the
               Danville #582 Substation near Danville in Boyle County.

                    Item 3.  The 69 kV  single circuit extension from the
               Lake Reba/Paint  Lick line  to the  Berea Substation  near
               Berea in Madison County.

                    Item  4.   The 138  kV single circuit  extension from
               the Brown  North/Higby  Mill  #2 line  to the  Clays  Mill
               Substation near Lexington in Fayette County.

                    Item 5.   The  69 kV  single circuit  wood pole  line
               extending  from the Rocky Branch/Pocket  line near Liggett
               in Harlan County.

                    Item 6.   The  69 kV  single circuit  wood pole  line
               extending form  the Lancaster/Dix line  near Lancaster  in
               Garrard County.

                    Item 7.   The  69 kV  single circuit  wood pole  line
               extending  from  the Cimarron  Tap  line  to  the  Andalex
               Island  Mine   metering  structure  near  Madisonville  in
               Hopkins County.

               THIRD:   The  following  described  electric  transmission
             lines of the Company located in Virginia:

                    Item 1.   The 34.5 kV  single circuit  wood pole line
               extending from the Dorchester/Andover 34.5 kV line to  the
               Canepatch  metering  structure  near  Canepatch  in   Wise
               County.

                    Item 2.   The 34.5 kV  single circuit  wood pole line
               extending  form the  Pardee Tap  line to  the new  Potcamp
               metering structure near Potcamp in Wise County.




                                         -64-
<PAGE>


                    Item 3.   The  69 kV  single circuit  wood pole  line
               attending from  the Imboden/Dorchester 69  kV line to  the
               Bear Branch Substation near Norton in Wise County.

               FOURTH:   The  following  described  real  estate  of  the
             Company situated in Carroll County, Kentucky.

               Beginning at a point  in the easterly line  of a tract  as
               conveyed to  Harold Swango  and recorded in Deed  Book 98,
               Page 25, in the  Carroll County Court Clerk s Office, said
               point  being  at  the  northwest  corner  of  a  tract  as
               conveyed to Elizabeth O Neal by the  will of T. W. O Neal,
               appearing of  record  in Will  Book  9,  Page 52,  in  the
               aforementioned  County  Clerk s  Office,  and  said  point
               having coordinate values of North 841.310'; West  6578.167
               as related  to the Control  System for Kentucky  Utilities
               Ghent Generating  Station; thence  with the  east line  of
               Swango North 20 deg. 37 min.  34 sec. West 1109.63 feet to
               a point  in  the  south  line of  the  Kentucky  Utilities
               Company tract,  said point being  at the northeast  corner
               of the  Swango tract;  thence leaving the  line of  Swango
               and  with the  southerly line  of the  Kentucky  Utilities
               Company tract North 65 deg. 08  min. 21 sec. East  1991.24
               feet to an iron pin; thence North 25  deg. 15 min. 24 sec.
               West 709.81  feet to an iron pin; thence North  81 deg. 36
               min. 54  sec. East  1142.51 feet  to an  iron pin;  thence
               South 25 deg. 40 min. 46 sec. East  197.82 feet to an iron
               pin;  thence North 67  deg. 47  min. 06  sec. East 1080.39
               feet to  a point  at the  Northwest corner  of a  tract as
               conveyed  to William  Gex and  Nancy  E. Diuguid  by  deed
               dated 2 January, 1973 and of record in Deed Book 77,  Page
               490,  and also deed dated  28 March, 1985 and of record in
               Deed  Book  99, Page  71,  in  the  aforementioned  County
               Clerk s Office; thence  leaving the southerly line of  the
               Kentucky Utilities  Company tract  and with  a fence,  the
               westerly  line of Diuguid  South 21  deg. 11  min. 52 sec.
               East 2024.50  feet to a fence  post; thence  with a fence,
               the  northerly line of  Diuguid South  65 deg.  17 min. 23
               sec.  West 435.58 feet  to a  fence post;  thence South 80
               deg. 45 min.  36 sec. West  387.01 feet  to a fence  post;
               thence  South 66 deg. 47 min. 38 sec.  West 122.32 feet to
               a fence post;  thence North 71 deg.  37 min. 54 sec.  West
               68.18  feet to a fence  post; thence South 79 deg. 15 min.
               54 sec. West  111.53 feet to a fence post; thence South 70
               deg.  40 min. 21 sec.  West 704.83 feet  to a wooden fence
               post in the east  line of the  previously mentioned O Neal
               tract; thence  leaving the northerly  line of Diuguid  and
               with the  easterly line  of O Neal  and a  fence North  24
               deg. 19  min. 03 sec.  West 441.59 feet to  a corner fence
               post; thence  with  the  northerly line  of O Neal  and  a
               fence South 79 deg. 46 min. 29 sec.  West 760.53 feet to a
               fence post;  thence South  81 deg.  24 min.  34 sec.  West

                                         -65-
<PAGE>


               263.05 feet to a corner fence  post; thence South 18  deg.
               57 min. 54 sec. West 233.77 feet  to a point; thence South
               65 deg. 27 min. 56 sec. West 610.52  feet to a fence post;
               thence South 63 deg.  23 min. 46 sec. West 570.34 feet  to
               the  point  of  beginning and  containing  149.185  acres,
               being the description set forth  in that property line map
               of Fuller,  Mossbarger, Scott and  May, which is  attached
               hereto  and made  a part  hereof, and  being the  property
               acquired by  the Company by deed  dated July  20, 1995 and
               recorded in Deed Book  124, Page 273, Carroll County Court
               Clerk s Office.

               FIFTH: The following described real estate of the  Company
             situated in Fayette County, Kentucky:

               All of Parcel 1  of the Consolidation  Minor Final  Record
               Plat,  Kentucky  Utilities  Company  Lansdowne  Substation
               Property of  record in Plat Cabinet  J, Slide  705, in the
               Office  of  the  Fayette  County  Clerk  being  known  and
               designated  as   a  portion  of  Lansdowne-Merrick   Park,
               Lexington,  Fayette   County,  Kentucky,   and  being  the
               property  acquired by  the Company by deed  dated July 19,
               1995  and recorded  in deed  Book 1797,  Page 598, Fayette
               County Court Clerk s Office.

               SIXTH: The following described real estate of the  Company
             situated in Grayson County, Kentucky:

               BEGINNING at a stake in the  east right of way  of Wallace
               Avenue, thence N 63  degrees 00' 02" E,  153.24 feet to  a
               stake, thence  S 56 degrees  56' 55" E,  193.60 feet to  a
               stake,  thence S  18 degrees  36' 07" W  230.42 feet  to a
               stake, thence N  71 degrees  30' 56" W,  155.56 feet to  a
               stake in the east right of  way of Wallace Avenue,  thence
               along the meanders of Wallace Avenue  N 17 degrees 51' 17"
               W 104.65 feet to  a stake, thence N  23 degrees 26'  22" W
               114.65 feet  to the  point of  beginning, containing  1.36
               acres,  more  or less,  as  determined  by  a survey  made
               August 12,  1994 by  Clemons Lane  Surveying, Inc.  R.L.S.
               2811,  and being  the property acquired by  the Company by
               deed dated April 13, 1995 and  recorded in Deed Book  252,
               Page 55, Grayson County Court Clerk s Office.

               SEVENTH:  The  following   decribed  real  estate  of  the
             Company situated in Harlan County, Kentucky:

                    Item 1:  Beginning at a steel pin set in  the line of
               the Cornelius property and at the northwest corner of  the
               Jeffrey Howard property;




                                         -66-
<PAGE>


                    thence  N 11  50'31"  W, 670.87  feet to  a steel pin
               found  on a spur,  the northeast  corner of  the Cornelius
               property;

                    thence continuing up  the spur N 54  23'32" E, 276.42
               feet  to a  steel pin  and cap  set  on  top of  the ridge
               between  Coxs Branch  and Rock  Branch, said  point  has a
               blazed 24" oak tree as a witness;

                    thence with  the ridge between  Coxs Branch and  Rock
               Branch, S 83  32'34" E, 440.76 feet to a steel pin set  on
               top of the ridge under a 500kv electric transmission  line
               of  the Kentucky Utilities Company and at the south right-
               of-way  of an  old electric  transmission line  which  has
               been removed;

                    thence   with   the  south   right-of-way   of   said
               transmission line  which has been removed, S 12  34'42" E,
               881.45 feet to a steel pin in the center of Coxs Branch;

                    thence down and  with the center of Coxs Branch,  the
               following five courses:  S 42  33' 28"  W, 57.76 feet to a
               point in ledge rock in the center of Coxs Branch;

                    thence S  77  28'16"  W, 147.87  feet to  a point  in
               ledge rock in the center of Coxs Branch;

                    thence S  14  56'17" W, 24.63  feet a  point in ledge
               rock in the center of Coxs Branch;

                    thence S  82  37'  17" W, 92.73  feet to  a point  in
               ledge rock in the center of Coxs Branch;

                    thence  N 76   28'08" W,  40.84  feet  to a  point in
               ledge rock in the center of  Coxs Branch, a common  corner
               with Jeffrey  Howard, a steel pin  and cap  witness on the
               bank bears N 10  26'35" E, 10.28 feet;

                    thence with the line of Jeffrey Howard, N 63   58'46"
               W,  440.17 feet  to  the point  of  beginning,  containing
               14.32  acres as  surveyed  by David  A.  Atwell,  Kentucky
               Registered Surveyor,  License Number 2063,  June 16, 1995,
               and being  the property acquired  by the  Company by  deed
               dated August 10, 1995 and recorded  in Deed Book 320, Page
               37, Harlan County Court Clerk s Office.

                    Item 2.  Beginning at a steel pin found  in the north
               right-of-way  of  Kentucky Highway  72,  at  the southeast
               corner of the Cornelius property;

                    thence with the Cornelius property line N 11   38'28"
               W, 323.29 feet to a steel pin set this survey;

                                         -67-
<PAGE>


                    thence leaving the  Cornelius line and with the  line
               of a tract to be conveyed by  Josh Howard to the  Kentucky
               Utilities Company, S 63  58'46" E,  440.17 feet to a  mark
               on ledge rock  in the center of  Coxs Branch, a steel  pin
               witness set  on the bank of Coxs Branch bears N 10  26'35"
               W, 10.28 feet;

                    thence down  and with the center  of Coxs Branch  the
               following  six courses: N  71  13'01"  W, 14.41  feet to a
               mark on ledge rock in the center of Coxs Branch;

                    thence S 72  01'34" W,  70.88 feet to a mark on ledge
               rock in the center of Coxs Branch;

                    thence S 69  04'11" W, 62.00 feet to a mark on  ledge
               rock in the center of Coxs Branch;

                    thence S 58  08'49" W, 78.43  feet to a mark on ledge
               rock in the center of Coxs Branch;

                    thence  S 62  54'14" W, 48.59 feet to a mark on ledge
               rock in the center of Coxs Branch;

                    thence S 53  30'25" W, 63.73 feet  to a steel pin set
               in the center of Coxs Branch  at the north right-of-way of
               Kentucky Highway 72;

                    thence with  the said  right-of-way N  60  17'26"  W,
               34.83  feet to  the point  of beginning,  containing  1.28
               acres by  survey of David  A. Atwell, Kentucky  Registered
               Surveyor License  Number 2063,  June 16,  1995, and  being
               the property acquired  by the Company by deed dated August
               10, 1995  and recorded in Deed  Book 320,  Page 41, Harlan
               County Court Clerk s Office.

               EIGHTH:  The  following  described  real  estate  of   the
             Company situated in McCracken County, Kentucky:

               Beginning  at a  point which  is the  intersection of  the
               centerline of the  Woodville-Heath Road (KY 725) with  the
               east  R/W line of Rice Springs Road (KY  995); thence S 15
               degrees 00' W 662.00 feet along the east R/W line of  Rice
               Springs  Road to a point;  thence S 70 degrees 00' E 425.6
               feet  to an iron  pin, said  iron pin  being the northeast
               corner of  Grantee s 100'  x 100' substation lot  and also
               the "true" point of beginning for this survey; thence

                    1.   S 20 degrees  00' W 100.00  feet along the  east
               side of Grantee s lot to an iron pin;

                    2.   N 70 degrees 00'  W 100.00 feet  along the south
               side of Grantee s lot to an iron pin;

                                         -68-
<PAGE>


                    3.   S 20  degrees  00'  W 22.47  feet along  a  line
               common to the Grantors  property to an iron pin;

                    4.  S 71  degrees 37' 49" E  150.06 feet along a line
               common to the James E. Beasley,  Jr., property to an  iron
               pin;

                    5.   N 20  degrees 00'  E 118.20  feet  along a  line
               common to Grantors  property to an iron pin;

                    6.   N  70  degrees 00'  W 50.00  feet  along a  line
               common  to  Grantors  property  to  the  "true"  point  of
               beginning,  containing .185 acres, and  being the property
               acquired by  the Company by deed  dated June  19, 1995 and
               recorded  in Deed  Book 834,  Page 836,  McCracken  County
               Clerk's Office.










                                         -69-
<PAGE>


               IN  WITNESS WHEREOF,  said  Kentucky  Utilities Company  has
          caused  this instrument to be  executed in its  corporate name by
          its President or a  Vice President and its  corporate seal to  be
          hereunto  affixed  and to  be attested  and countersigned  by its
          Secretary,   and   said  First   Trust   of   Illinois,  National
          Association,  for the purpose  of entering into  and joining with
          the Company in  the execution of this supplemental indenture, has
          caused  this instrument to be  executed in its  corporate name by
          one of its Vice Presidents and  its corporate seal to be hereunto
          affixed  and  to  be attested  by  one  of  its Vice  Presidents,
          Assistant  Vice  Presidents or  Trust  Officers,  and said  Frank
          Sgaraglino, for the purpose of entering into and joining with the
          Company  in the  execution  of this  supplemental indenture,  has
          signed and sealed  this instrument;  all as of  the day and  year
          first above written.


                                        KENTUCKY UTILITIES COMPANY


                                        By        /s/ O. M. Goodlett
                                                  O. M. Goodlett
                                              Senior Vice President

            Attest:     /s/ George S. Brooks II
                        George S. Brooks II
                        General Counsel
                         and Secretary                    (Corporate Seal)



                                        FIRST TRUST OF ILLINOIS, NATIONAL
                                             ASSOCIATION



                                        By   /s/ Steven E. Charles
                                             Steven E. Charles
                                             Vice President



          Attest:  /s/ Larry Kusch
                   Larry Kusch
                   Asst. Vice President
                                                           (Corporate Seal)



                                        /s/ Frank Sgaraglino
                                        FRANK SGARAGLINO
                                                                      (Seal)



                                         -70-
<PAGE>


          Commonwealth of Kentucky )
                                   ) ss:
          County of Fayette        )

               I, Rella M. Evans, a Notary Public in and for said County in
          the  Commonwealth  aforesaid,  do   hereby  certify  that   O. M.
          Goodlett, Senior Vice President  of Kentucky Utilities Company, a
          Kentucky  and  Virginia corporation,  and  George  S. Brooks  II,
          General Counsel and Secretary of  said corporation, who are  both
          personally known to  me to be  the same  persons whose names  are
          subscribed to the foregoing  instrument as such officers of  said
          corporation, and who  are both personally known to  me to be such
          officers, appeared before  me this  day in  person and  severally
          acknowledged  before me  that they  signed, sealed  and delivered
          said instrument as their free and voluntary act as such officers,
          and as the free and  voluntary act and deed of said  corporation,
          for the  uses and  purposes  therein set  forth; and  said O.  M.
          Goodlett,  upon  oath, acknowledged  himself  to  be Senior  Vice
          President of said  corporation and that,  as such officer,  being
          authorized so to do, he executed said instrument for the purposes
          therein  contained,  by  signing  the name  of  said  corporation
          thereto by himself as such officer.

               Given  under my  hand and  official seal  this 18th day of
          January, 1996.


                                             /s/ Rella M. Evans
                                             Rella M. Evans
                                            Notary Public
          (Notarial Seal)
                               My commission expires: November  20, 1999










                                         -71-
<PAGE>


          State of Illinois        )
                                   ) ss:
          County of Cook           )

               I, David W. Traubert, a Notary Public in and for said County
          in the State aforesaid, do hereby certify that:

               (a)  Steven E. Charles, a  Vice President of  First Trust of
          Illinois,  National Association, a  national banking association,
          and Larry Kusch, an Assistant Vice President of said association,
          who are both personally known to  me to be the same persons whose
          names are  subscribed to  the foregoing  instrument as  such Vice
          President  and Assistant Vice President  of said association, and
          who are both personally known to me to be such officers, appeared
          before me this day in person and severally acknowledged before me
          that  they signed, sealed and  delivered said instrument as their
          free  and voluntary  act as such  officers, and  as the  free and
          voluntary  act and  deed of  said association,  for the  uses and
          purposes therein  set forth;  and  said Steven  E. Charles,  upon
          oath,  acknowledged himself  to  be  a  Vice  President  of  said
          association and that, as such officer, being authorized so to do,
          he executed  said instrument for the  purposes therein contained,
          by signing the  name of  said association thereto  by himself  as
          such officer; and

               (b)  Frank Sgaraglino, personally known to me to be the same
          person  described  in,  and  whose  name  is subscribed  to,  the
          foregoing instrument,  appeared before me this day  in person and
          acknowledged  before  me that  he  executed,  signed, sealed  and
          delivered said instrument as his free and voluntary act and deed,
          for the uses and purposes therein set forth.

               Given  under my  hand and  official seal  this 18th  day of
          January, 1996.


                                        /s/ D. W. Traubert
                                        D. W. Traubert
                                        Notary Public

          (Notarial Seal)




               This  instrument was prepared by George  S. Brooks II, Esq.,
          One Quality Street, Lexington, Kentucky 40507.


                                             /s/ George S. Brooks II
                                             George S. Brooks II


                                         -72-