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Exhibit 4(b)




PPL CAPITAL FUNDING, INC.,

Issuer




and




PPL CORPORATION,

Guarantor




TO




THE BANK OF NEW YORK,

Trustee




 






Supplemental Indenture No. 1




Dated as of March 1, 2007




Supplemental to the Subordinated Indenture

dated as of March 1, 2007




Establishing a series of Securities designated

2007 Series A Junior Subordinated Notes due 2067

limited in aggregate principal amount to $500,000,000




 









 





          SUPPLEMENTAL INDENTURE No. 1, dated as of March 1, 2007 among PPL CAPITAL FUNDING, INC., a
corporation duly organized and existing under the laws of the State of Delaware (herein called the
“Company”), PPL CORPORATION, a corporation duly organized and existing under the laws of the
Commonwealth of Pennsylvania (herein called the “Guarantor”), and THE BANK OF NEW YORK, a New York
banking corporation, as Trustee (herein called the “Trustee”), under the Subordinated Indenture
dated as of March 1, 2007 (hereinafter called the “Original Indenture”), this Supplemental
Indenture No. 1 being supplemental thereto. The Original Indenture and any and all indentures and
instruments supplemental thereto are hereinafter sometimes collectively called the “Indenture.”




Recitals of the Company and the Guarantor




          The Original Indenture was authorized, executed and delivered by the Company and the Guarantor
to provide for the issuance by the Company from time to time of its Securities (such term and all
other capitalized terms used herein without definition having the meanings assigned to them in the
Original Indenture), to be issued in one or more series as contemplated therein, and for the
Guarantee by the Guarantor of the payment of the principal, premium, if any, and interest, if any,
on such Securities.




          As contemplated by Sections 301 and 1201(f) of the Original Indenture, the Company wishes to
establish a series of Securities to be designated “2007 Series A Junior Subordinated Notes due
2067” to be limited in aggregate principal amount (except as contemplated in Section 301(b) and the
last paragraph of Section 301 of the Original Indenture) to $500,000,000, such series of Securities
to be hereinafter sometimes called “Series No. 1.”




          As contemplated by Sections 201 and 1415 of the Original Indenture, the Guarantor wishes to
establish the form and terms of the Guarantees to be endorsed on the Securities of Series No. 1.




          The Company has duly authorized the execution and delivery of this Supplemental Indenture No.
1 to establish the Securities of Series No. 1 and has duly authorized the issuance of such
Securities; the Guarantor has duly authorized the execution and delivery of this Supplemental
Indenture No. 1 and has duly authorized its Guarantees of the Securities of Series No. 1; and all
acts necessary to make this Supplemental Indenture No. 1 a valid agreement of the Company and the
Guarantor, to make the Securities of Series No. 1 valid obligations of the Company, and to make the
Guarantees valid obligations of the Guarantor, have been performed.




          NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE No. 1 WITNESSETH:




          For and in consideration of the premises and of the purchase of the Securities by the Holders
thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all
Holders of the Securities of Series No. 1, as follows:




 









 








ARTICLE ONE




First Series of Securities




          Section 1. There is hereby created a series of Securities designated “2007 Series A Junior
Subordinated Notes due 2067” and limited in aggregate principal amount (except as contemplated in
Section 301(b) and the last paragraph of Section 301 of the Original Indenture) to $500,000,000.
The forms and terms of the Securities of Series No. 1 shall be established in an Officers’
Certificate of the Company and the Guarantor, as contemplated by Section 301 of the Original
Indenture.




          Section 2. As contemplated in Sections 301(e) and 312 of the Original Indenture, the Company
shall have the right to extend any interest period and defer the payment of interest for one or
more interest periods (the period of any such extension and deferral herein called, an “Optional
Deferral Period”) pursuant to the terms and conditions established in such Officers’ Certificate.




          Section 3. (a) The Company and the Guarantor hereby agree that, subject to the exceptions set
forth in Section 3(b) below, if the Company shall have elected to extend any interest payment
period and defer payment of interest on the Securities of Series No. 1 as contemplated in Section
312 of the Original Indenture and Section 2 hereof, and any such period, or any extension thereof,
shall be continuing, then neither the Guarantor nor the Company shall:





     (A) declare or pay any dividends or distributions on its capital stock, other than
dividends paid in shares of its capital stock,




     (B) redeem, purchase, acquire or make a liquidation payment with respect to any of its
capital stock,




     (C) pay any principal, interest or premium on, or repay, repurchase or redeem any debt
securities that are equal or junior in right of payment to the Securities of Series No. 1 or
the related Guarantees, as the case may be, or




     (D) make any payments with respect to any guarantee of debt securities by the Guarantor
if such guarantee is equal or junior in right of payment to the Securities of Series No. 1
or the related Guarantees, as the case may be (other than payments under the Guarantees).


(b) The foregoing provisions shall not prevent or restrict the Guarantor or the Company from
making, and the Guarantor and the Company shall be permitted at any time, including during an
Optional Deferral Period, to make, any of the following:





     (A) purchases, redemptions or other acquisitions of its capital stock in connection
with any employment contract, benefit plan or other similar arrangement with or for the
benefit of employees, officers, directors or agents or a stock purchase or dividend
reinvestment plan, or the satisfaction of its obligations pursuant to any contract or
security outstanding on the date that the payment of interest is deferred requiring it to
purchase, redeem or acquire its capital stock,



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     (B) any payment, repayment, redemption, purchase, acquisition or declaration of
dividend as a result of a reclassification of its capital stock, or the exchange or
conversion of all or a portion of one class or series of its capital stock for another class
or series of its capital stock,




     (C) the purchase of fractional interests in shares of its capital stock pursuant to the
conversion or exchange provisions of its capital stock or the security being converted or
exchanged, or in connection with the settlement of stock purchase contracts,




     (D) dividends or distributions paid or made in its capital stock (or rights to acquire
its capital stock), or repurchases, redemptions or acquisitions of capital stock in
connection with the issuance or exchange of capital stock (or of securities convertible into
or exchangeable for shares of its capital stock) and distributions in connection with the
settlement of stock purchase contracts outstanding on the date that the payment of interest
is deferred,




     (E) redemptions, exchanges or repurchases of, or with respect to, any rights
outstanding under a shareholder rights plan or the declaration or payment thereunder of a
dividend or distribution of or with respect to rights in the future, or




     (F) payments under any preferred trust securities, subordinated debentures, or any
junior subordinated debentures, or guarantees of the foregoing, in each case that rank equal
in right of payment to the Securities of Series No. 1 or the related Guarantees, so long as
the amount of payments made on account of such securities or guarantees is paid on all such
securities and guarantees then outstanding on a pro rata basis in proportion to the full
payment to which each series of such securities or guarantees is then entitled if paid in
full.



          Section 4. The Company hereby agrees that, if the Company shall make any deposit of money
and/or Eligible Obligations with respect to any Securities of Series No. 1, or any portion of the
principal amount thereof, as contemplated by Section 701 of the Original Indenture, the Company
shall not deliver an Officer’s Certificate described in clause (z) in the first paragraph of said
Section 701 unless the Company shall also deliver to the Trustee, together with such Officer’s
Certificate, either:





     (A) an instrument wherein the Company, notwithstanding the satisfaction and discharge
of its indebtedness in respect of such Securities, shall assume the obligation (which shall
be absolute and unconditional) to irrevocably deposit with the Trustee or Paying Agent such
additional sums of money, if any, or additional Eligible Obligations (meeting the
requirements of Section 701), if any, or any combination thereof, at such time or times, as
shall be necessary, together with the money and/or Eligible Obligations theretofore so
deposited, to pay when due the principal of and premium, if any, and interest due and to
become due on such Securities or portions thereof, all in accordance with and subject to the
provisions of said Section 701; provided, however, that such instrument may state that the
obligation of the Company to make additional deposits as aforesaid shall arise only upon the
delivery to the Company by the Trustee of a notice asserting the deficiency and showing the
calculation thereof and shall continue only until



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the Company shall have delivered to the Trustee an opinion of an independent public
accountant of nationally recognized standing to the effect that no such deficiency exists
and showing the calculation of the sufficiency of the deposits then held by the Trustee; or




     (B) an Opinion of Counsel to the effect that the Holders of such Securities, or
portions of the principal amount thereof, will not recognize income, gain or loss for United
States federal income tax purposes as a result of the satisfaction and discharge of the
Company’s indebtedness in respect thereof and will be subject to United States federal
income tax on the same amounts, at the same times and in the same manner as if such
satisfaction and discharge had not been effected.



          Section 5. The Company and the Guarantor agree that for so long as any Securities of Series
No. 1 shall remain outstanding, and notwithstanding Section 1201(c) of the Original Indenture, the
Company and the Guarantor shall not enter into any supplemental indenture with the Trustee to
provide for any additional Event of Default with respect to the Securities of Series No. 1, without
the consent of the Holders of a majority in principal amount of the Securities of Series No. 1 then
outstanding.




ARTICLE TWO




Form of Guarantee




          Guarantees to be endorsed on the Securities of Series No. 1 shall be in substantially the form
set forth below:




[FORM OF GUARANTEE]





          PPL Corporation, a corporation organized under the laws of the Commonwealth of
Pennsylvania (the “Guarantor”, which term includes any successor under the Indenture
(the “Indenture”) referred to in the Security upon which this Guarantee is
endorsed), for value received, hereby fully and unconditionally guarantees to the
Holder of the Security upon which this Guarantee is endorsed, the due and punctual
payment of the principal of, and premium, if any, and interest, if any, on such
Security when and as the same shall become due and payable, whether at the Stated
Maturity, by declaration of acceleration, call for redemption, or otherwise, in
accordance with the terms of such Security and of the Indenture. In case of the
failure of PPL Capital Funding, Inc., a corporation organized under the laws of the
State of Delaware (the “Company”, which term includes any successor under the
Indenture), punctually to make any such payment (and subject to the Company’s right
to defer the Stated Maturity of interest payments as provided in the Security upon
which this Guarantee is endorsed), the Guarantor hereby agrees to cause such payment
to be made punctually when and as the same shall become due and payable, whether at
the Stated Maturity or by declaration of acceleration, call for redemption or
otherwise, and as if such payment were made by the Company.



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          The Guarantor hereby agrees that its obligations hereunder shall be absolute
and unconditional irrespective of, and shall be unaffected by, any invalidity,
irregularity or unenforceability of such Security or the Indenture, any failure to
enforce the provisions of such Security or the Indenture, or any waiver,
modification or indulgence granted to the Company with respect thereto, by the
Holder of such Security or the Trustee or any other circumstance which may otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor;
provided, however, that notwithstanding the foregoing, no such waiver, modification
or indulgence shall, without the consent of the Guarantor, increase the principal
amount of such Security, or increase the interest rate thereon, or change any
redemption provisions thereof (including any change to increase any premium payable
upon redemption thereof) or change the Stated Maturity thereof.




          The Guarantor hereby waives the benefits of diligence, presentment, demand for
payment, any requirement that the Trustee or the Holder of such Security exhaust any
right or take any action against the Company or any other Person, filing of claims
with a court in the event of insolvency or bankruptcy of the Company, any right to
require a proceeding first against the Company, protest or notice with respect to
such Security or the indebtedness evidenced thereby and all demands whatsoever, and
covenants that this Guarantee will not be discharged in respect of such Security
except by complete performance of the obligations contained in such Security and in
this Guarantee. This Guarantee shall constitute a guaranty of payment and not of
collection. The Guarantor hereby agrees that, in the event of a default in payment
of principal, or premium, if any, or interest, if any, on such Security, whether at
its Stated Maturity, by declaration of acceleration, call for redemption, or
otherwise, legal proceedings may be instituted by the Trustee on behalf of, or by,
the Holder of such Security, subject to the terms and conditions set forth in the
Indenture, directly against the Guarantor to enforce this Guarantee without first
proceeding against the Company.




          The obligations of the Guarantor hereunder with respect to such Security shall
be continuing and irrevocable until the date upon which the entire principal of,
premium, if any, and interest, if any, on such Security has been, or has been deemed
pursuant to the provisions of Article Seven of the Indenture to have been, paid in
full or otherwise discharged.




          The obligations evidenced by this Guarantee are, to the extent provided in the
Indenture, subordinated and subject in right of payment to the prior payment in full
of all Senior Indebtedness (as defined in the Indenture) of the Guarantor, and this
Guarantee is issued subject to the provisions of the Indenture with respect thereto.
Each Holder of a Security upon which this Guarantee is endorsed, by accepting the
same, (a) agrees to and shall be bound by such provisions, (b) authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination so provided and (c)
appoints the Trustee his attorney-in fact for any and all such purposes. Each
Holder hereof, by his acceptance hereof, hereby



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waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Indebtedness, whether now
outstanding or hereafter incurred, and waives reliance by each such Holder upon said
provisions.




          The Guarantor shall be subrogated to all rights of the Holder of such Security
upon which this Guarantee is endorsed against the Company in respect of any amounts
paid by the Guarantor on account of such Security pursuant to the provisions of this
Guarantee or the Indenture; provided, however, that the Guarantor shall not be
entitled to enforce or to receive any payments arising out of, or based upon, such
right of subrogation until the principal of, and premium, if any, and interest, if
any, on all Securities issued under the Indenture shall have been paid in full.




          This Guarantee shall remain in full force and effect and continue
notwithstanding any petition filed by or against the Company for liquidation or
reorganization, the Company becoming insolvent or making an assignment for the
benefit of creditors or a receiver or trustee being appointed for all or any
significant part of the Company’s assets, and shall, to the fullest extent permitted
by law, continue to be effective or reinstated, as the case may be, if at any time
payment of the Security upon which this Guarantee is endorsed, is, pursuant to
applicable law, rescinded or reduced in amount, or must otherwise be restored or
returned by the Holder of such Security, whether as a “voidable preference,”
“fraudulent transfer,” or otherwise, all as though such payment or performance had
not been made. In the event that any payment, or any part thereof, is rescinded,
reduced, restored or returned on such Security, such Security shall, to the fullest
extent permitted by law, be reinstated and deemed paid only by such amount paid and
not so rescinded, reduced, restored or returned.




          This Guarantee shall not be valid or obligatory for any purpose until the
certificate of authentication of the Security upon which this Guarantee is endorsed
shall have been manually executed by or on behalf of the Trustee under the
Indenture.




          All terms used in this Guarantee which are defined in the Indenture shall have
the meanings assigned to them in such Indenture.




          This Guarantee shall be deemed to be a contract made under the laws of the
State of New York, and for all purposes shall be governed by and construed in
accordance with the laws of the State of New York.




          IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be executed as
of the date first written above.



	 	 	 
	 

	 	PPL CORPORATION
	 
	 	 
	 

	 	By:






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[END OF FORM]




ARTICLE THREE




Miscellaneous Provisions




          Section 1. This Supplemental Indenture No. 1 is a supplement to the Original Indenture. As
supplemented by this Supplemental Indenture No. 1, the Indenture is in all respects ratified,
approved and confirmed, and the Original Indenture and this Supplemental Indenture No. 1 shall
together constitute one and the same instrument.




          Section 2. The recitals contained in this Supplemental Indenture No. 1 shall be taken as the
statements of the Company and the Guarantor, and the Trustee assumes no responsibility for their
correctness and makes no representations as to the validity or sufficiency of this Supplemental
Indenture No. 1.




          Section 3. This instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall together constitute but
one and the same instrument.




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          IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture No. 1 to be
duly executed, and their respective corporate seals to be hereunto affixed and attested, all as of
the day and year first written above.




	 	 	 	 	 
	 	PPL CAPITAL FUNDING, INC.

 	 
	 	By:  	/s/ James E. Abel
 	 
	 	 	Name:  	James E. Abel 	 
	 	 	Title:  	Treasurer 	 
	 



	 	 	 	 	 
	 	PPL CORPORATION

 	 
	 	By:  	/s/ James E. Abel
 	 
	 	 	Name:  	James E. Abel 	 
	 	 	Title:  	Vice President-Finance and
Treasurer 	 
	 



	 	 	 	 	 
	 	THE BANK OF NEW YORK,

as Trustee

 	 
	 	By:  	/s/ Alfia Monastra
 	 
	 	 	Name:  	Alfia Monastra 	 
	 	 	Title:  	Vice President