Exhibit 4(c)

          =================================================================


                             SUPPLEMENTAL INDENTURE NO. 3


                               ------------------------

                            TUCSON ELECTRIC POWER COMPANY


                                          TO


                           BANK OF MONTREAL TRUST COMPANY,

                                       TRUSTEE


                              --------------------------

                              Dated as of August 1, 1998


                              -------------------------

               Supplemental to Indenture of Mortgage and Deed of Trust,
                             dated as of December 1, 1992

                               -----------------------

                         Creating Series of Bonds Designated
                   First Mortgage Bonds, Collateral Series due 2008


                              -------------------------



          ================================================================

            This instrument constitutes a mortgage, a deed of trust and a
                                 security agreement.



               SUPPLEMENTAL INDENTURE NO. 3, dated as of August 1, 1998,
          between TUCSON ELECTRIC POWER COMPANY (hereinafter sometimes
          called (the "Company"), a corporation organized and existing
          under the laws of the State of Arizona, having its principal
          office at 220 West Sixth Street, in the City of Tucson, Arizona,
          as trustor, and BANK OF MONTREAL TRUST COMPANY, a banking
          corporation organized and existing under the laws of the State of
          New York and having its principal office at 88 Pine Street, in
          the Borough of Manhattan, The City of New York, New York, as
          trustee (hereinafter sometimes called the "Trustee"), under the
          Indenture of Mortgage and Deed of Trust, dated as of December 1,
          1992 (hereinafter called the "Original Indenture"), as heretofore
          supplemented, this Supplemental Indenture No. 3 being
          supplemental thereto (the Original Indenture as heretofore
          supplemented, and as supplemented hereby, and as it may from time
          to time be further supplemented, modified, altered or amended by
          any supplemental indenture entered into in accordance with and
          pursuant to the provisions thereof, is hereinafter called the
          "Indenture").

                               RECITALS OF THE COMPANY

               WHEREAS the Original Indenture was authorized, executed and
          delivered by the Company to provide for the issuance from time to
          time of its Bonds (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
          therein contemplated, and to provide security for the payment of
          the principal of and premium, if any, and interest, if any, on
          the Bonds; and

               WHEREAS, the Company has heretofore executed and delivered
          to the Trustee two supplemental indentures for the purposes
          recited therein including the creation of two series of Bonds, as
          set forth in Schedule A hereto; and

               WHEREAS, the Company proposes to establish a series of Bonds
          designated "First Mortgage Bonds, Collateral Series due 2008",
          such series to be limited in aggregate principal amount (except
          as contemplated in clause (b) of Section 2 of Article II of the
          Original Indenture) to $140,000,000, such series of Bonds and
          such Bonds to be hereinafter sometimes called, respectively,
          "Series 3" and "Series 3 Bonds"; and

               WHEREAS, all acts and proceedings required by law and by the
          articles of incorporation and by-laws of the Company, including
          all action requisite on the part of its shareholders, directors
          and officers, necessary to make the Series 3 Bonds, when executed
          by the Company, authenticated and delivered by the Trustee and
          duly issued, the valid, binding and legal obligations of the
          Company, and to constitute this Supplemental Indenture a valid,
          binding and legal instrument, in accordance with its and their
          terms, have been done and taken; and the execution and delivery
          of this Supplemental Indenture No. 3 have been in all respects
          duly authorized.


                                   GRANTING CLAUSES
                                                               
               NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE NO. 3
          WITNESSETH, that, in order to secure the payment of the principal
          of and premium, if any, and interest, if any, on all Bonds at any
          time Outstanding under the Indenture according to their tenor,
          purport and effect, and to secure the performance and observance
          of all the covenants and conditions therein and herein contained
          (except any covenant of the Company with respect to the refund or
          reimbursement of taxes, assessments or other governmental charges
          on account of the ownership of the Bonds of any series or the
          income derived therefrom, for which the Holders of the Bonds
          shall look only to the Company and not to the property hereby
          mortgaged or pledged), and to declare the terms and conditions
          upon and subject to which the Series 3 Bonds are to be issued,
          and for and in consideration of the premises and of the mutual
          covenants herein contained and of the purchase and acceptance of
          the Bonds by the Holders thereof, and of the sum of $1 duly paid
          to the Company by the Trustee at or before the ensealing and
          delivery hereof, and for other good and valuable consideration,
          the receipt and sufficiency whereof are hereby acknowledged, the
          Company has executed and delivered this Indenture, and by these
          presents does grant, bargain, sell, release, convey, assign,
          transfer, mortgage, pledge, set over and confirm unto the
          Trustee, and grant to the Trustee a security interest in:

                    All and singular the premises, property, assets,
               rights and franchises of the Company (except Excepted
               Property), whether now or hereafter owned, constructed
               or acquired, of whatever character and wherever
               situated including, among other things (but reference
               to or enumeration of any particular kinds, classes or
               items of property shall not be deemed to exclude from
               the operation and effect of this Indenture any kind,
               class or item not so referred to or enumerated), all
               right, title and interest of the Company in and to the
               property described as granted in "Schedule B" attached
               to this Supplemental Indenture No. 3 and made part of
               these Granting Clauses to the same extent as if fully
               set forth in the same, and all plants for the
               generation of electricity by water, steam and/or other
               power; all power houses, substations, transmission
               lines, distributing systems; all offices, buildings and
               structures, and the equipment thereof; all machinery,
               engines, boilers, dynamos, machines, regulators,
               meters, transformers, generators and motors; all
               appliances whether electrical, gas or mechanical,
               conduits, cables and lines; all pipes, service pipes,
               fittings, valves and connections, poles, wires, tools,
               implements, apparatus, furniture, and chattels; all
               municipal franchises and other franchises; all lines
               for the transmission and/or distribution of electric
               current, including towers, poles, wires, cables, pipes,
               conduits, street lighting systems and all apparatus for
               use in connection therewith; all real estate, lands,
               leaseholds; all easements, servitudes, licenses,
               permits, rights, powers, franchises, privileges,
               rights-of-way and other rights in or relating to real
               estate or the occupancy of the same and all the right,
               title and interest of the Company in and to all other
               property of any kind or nature appertaining to and/or
               used and/or occupied and/or enjoyed in connection with
               any property hereinbefore described; it being the
               intention of the parties that all property of every
               kind, real, personal or mixed (including, but not
               limited to, all property of the types hereinbefore
               described), other than Excepted Property, which may be
               acquired by the Company after the date hereof, shall,
               immediately upon the acquisition thereof by the
               Company, to the extent of such acquisition, and without
               any further conveyance or assignment, become and be
               subject to the direct lien of the Indenture as fully
               and completely as though now owned by the Company and
               described in said "Schedule B"; it further being the
               intention of the paries, however, that the lien of and
               security interest granted by this Indenture shall not
               result in the Trustee having greater rights with
               respect to any property of the Company, real, personal
               or mixed (including, but not limited to, leasehold
               interests in property) than the rights of the Company
               with respect to such property.

               TOGETHER WITH all and singular the tenements, hereditaments
          and appurtenances belonging or in any wise appertaining to the
          aforesaid premises, property, assets, rights and franchises or
          any part thereof, with the reversion and reversions, remainder
          and remainders, and all the estate, right, title and interest and
          claim whatsoever, at law as well as in equity, which the Company
          now has or may hereafter acquire in and to the aforesaid
          premises, property, assets, rights and franchises and every part
          and parcel thereof.

               Subject, however, to the reservations, exceptions,
          limitations and restrictions contained in the several deeds,
          leases, servitudes, contracts, decrees, judgments, or other
          instruments through which the Company acquired or claims title to
          or enjoys the use of the aforesaid properties; and subject also
          to such easements, leases, reservations, servitudes, reversions
          and other rights and privileges of others and such mortgages,
          liens and other encumbrances in, on, over, across or through said
          properties as existed at the time of the acquisition of such
          properties by the Company or as have been granted by the Company
          to other persons at or prior to the time of the issuance and
          delivery of the Bonds of the Initial Series, including, but not
          limited to, the lien of the 1941 Mortgage and the security
          interest created thereby; and subject also to Permitted En- 
          cumbrances and, as to any property acquired by the Company after
          the time of the issuance and delivery of the Bonds of the Initial
          Series, to any easements, leases, reservations, servitudes,
          reversions and other rights and privileges of others and
          mortgages, liens or other encumbrances thereon existing, and to
          any mortgages, liens and other encumbrances for unpaid portions
          of the purchase money placed thereon, at the time of such
          acquisition, it being understood that with respect to any such
          after-acquired property the Lien of the Indenture (as hereinafter
          defined) shall at all times be junior, subject and subordinate to
          the lien of the 1941 Mortgage and the security interest created
          thereby; and subject also to the provisions of Article XI of the
          Original Indenture;

               TO HAVE AND TO HOLD the Trust Estate and all and singular
          the lands, properties, estates, rights, franchises, privileges
          and appurtenances hereby granted, bargained, sold, released,
          conveyed, assigned, transferred, mortgaged, pledged, set over and
          confirmed, together with all the appurtenances thereunto
          appertaining, unto the Trustee and its successors and assigns,
          forever;

               BUT IN TRUST, NEVERTHELESS, for the equal and proportionate
          use, benefit, security and protection of those who from time to
          time shall hold the Bonds authenticated and delivered hereunder
          and duly issued by the Company, without any discrimination,
          preference or priority of any one Bond over any other by reason
          of priority in the time of issue, sale or negotiation thereof or
          otherwise, except as provided in Section 2 of Article IV of the
          Original Indenture, so that, subject to said provisions, each and
          all of said Bonds shall have the same right, lien and privilege
          under the Indenture and shall be equally secured hereby (except
          as any sinking, amortization, improvement, renewal or other fund,
          established in accordance with the provisions of the Indenture,
          may afford additional security for the Bonds of any particular
          series), and shall have the same proportionate interest and share
          in the Trust Estate, with the same effect as if all of the Bonds
          had been issued, sold and negotiated simultaneously on the date
          of the delivery hereof; and in trust for enforcing payment of the
          principal of the Bonds, and premium, if any, and interest, if
          any, thereon, according to the tenor, purport and effect of the
          Bonds and of the Indenture, and for enforcing the terms,
          provisions, covenants and agreements herein and in the Bonds set
          forth;

               UPON CONDITION that, until the happening of a Default, the
          Company shall be suffered and permitted to possess, use and enjoy
          the Trust Estate (except money, securities and other personal
          property pledged or deposited with or required to be pledged or
          deposited with the Trustee hereunder) and to receive and use the
          rents, issues, income, revenues, earnings and profits therefrom,
          all as more specifically provided in Section 1 of Article VII of
          the Original Indenture;

               AND UPON THE TRUSTS, USES AND PURPOSES and subject to the
          covenants, agreements and conditions hereinafter set forth and
          declared.

                                       ARTICLE 

                                    SERIES 3 BONDS


               SECTION 1.  BASIC PROVISIONS.

               There is hereby established a series of Bonds having the
          following terms and characteristics (the lettered subdivisions
          set forth below corresponding to the lettered subdivisions of
          SECTION 2 of Article II of the Indenture):

                    (a)  the title of the Bonds of such series, being
               Series No. 3 under the Indenture, shall be "First Mortgage
               Bonds, Collateral Series due 2008" (such Bonds being
               hereinafter sometimes called the "Series 3 Bonds");

                    (b)  the aggregate principal amount of Series 3 Bonds
               which may be authenticated and delivered under the Indenture
               shall be limited to $140,000,000, except as contemplated in
               subdivision (b) of SECTION 2 of Article II of the Original
               Indenture;

                    (c)  not applicable;

                    (d)  the Series 3 Bonds shall mature on August 1, 2008;

                    (e)  the Series 3 Bonds shall not bear interest;

                    (f)  the office of the Trustee in New York, New York,
               shall be the office or agency of the Company in The City of
               New York at which (i) the principal of the Series 3 Bonds
               shall be payable upon presentation thereof, (ii)
               registration of transfer of Series 3 Bonds may be effected,
               (iii) exchanges of Series 3 Bonds may be effected and (iv)
               notices, and demands to or upon the Company in respect of
               the Series 3 Bonds or the Indenture may be served; provided,
               however, that the Company reserves the right to change, by
               written notice to the Trustee, such office or agency in The
               City of New York; and provided, further, that the principal
               office of the Company in Tucson, Arizona shall be an
               additional financial office or agency where the principal of
               the Series 3 Bonds shall be payable upon presentation
               thereof;                                                
                        
                    (g)  The Series 3 Bonds shall be redeemable at the
               option of the Company, in whole at any time or in part from
               time to time, at a redemption price equal to the principal
               amount of the Series 3 Bonds to be redeemed;

                    (h)  not applicable;

                    (i)  the Series 3 Bonds shall be issued in
               denominations of $1,000 and integral multiples thereof;

                    (j)  not applicable;

                    (k)  not applicable;

                    (l)  not applicable;

                    (m)  not applicable;

                    (n)  not applicable;

                    (o)  not applicable;

                    (p)  not applicable;

                    (q)  The Series 3 Bonds shall be issued and delivered
               by the Company to Bank of Montreal Trust Company, as trustee
               under the Indenture, to be dated as of August 1, 1998, as
               supplemented (the "1998 Indenture"), of the Company to such
               trustee (the "1998 Indenture Trustee"), in exchange for
               obligations of the Company which have heretofore been
               delivered to the 1998 Indenture Trustee, as the basis for
               the authentication and delivery of securities under the 1998
               Indenture.  As provided in the 1998 Indenture, the Series 3
               Bonds, when so issued and delivered, will be registered in
               the name of the 1998 Indenture Trustee or its nominee and
               will be owned and held by the 1998 Indenture Trustee,
               subject to the provisions of the 1998 Indenture, for the
               benefit of the holders of all securities from time to time
               outstanding under the 1998 Indenture, and the Company shall
               have no interest therein.  The Series 3 Bonds shall not be
               transferable except as required to effect transfer to any
               successor trustee under the 1998 Indenture.

                    (r)  not applicable;

                    (s)  no service charge shall be made for the
               registration of transfer or exchange of Series 3A Bonds;
               provided, however, that the Company may require payment of a
               sum sufficient to cover any tax or governmental charge
               payable in connection with such transfer or exchange; and

                    (t)  not applicable.

                
               SECTION 2.     ADDITIONAL PROVISIONS.

               Set forth below in this SECTION 2 are additional terms of
          the Series 3 Bonds, as contemplated by clause (u) in the first
          paragraph of SECTION 1 of Article II of the Original Indenture.

                    (a)  Anything herein to the contrary notwithstanding,
               any payment by the Company under the 1998 Indenture of the
               principal of the securities which shall have been
               authenticated and delivered under the 1998 Indenture on the
               basis of the delivery to the 1998 Indenture Trustee of
               Series 3 Bonds (other than by the application of the
               proceeds of a payment in respect of such Series 3 Bonds)
               shall, to the extent thereof, be deemed to satisfy and
               discharge the obligation of the Company, if any, to make a
               payment of principal of such Series 3 Bonds which is then
               due.

                         The Trustee shall be entitled to presume that the
               obligation of the Company to pay the principal of the Series
               3 Bonds as the same shall become due and payable, whether at
               maturity, upon redemption or otherwise, shall have been
               fully satisfied and discharged unless and until it shall
               have received a written notice from the 1998 Indenture
               Trustee, signed by an authorized officer thereof, stating
               that the principal of specified Series 3 Bonds has become
               due and payable and has not been fully paid, and specifying
               the amount of funds required to make such payment.

                    (b)  the Series 3 Bonds shall have such other terms,
               and shall bear such restrictive legends, as are set forth in
               the form of Series 3 Bond attached hereto as Exhibit A; 

                    (c)  if the Company shall make any deposit of money
               and/or Government Obligations with respect to any Series 3
               Bonds, or any portion of the principal amount thereof, as
               contemplated by SECTION 1 of Article XV of the Original
               Indenture, then the Company shall not deliver a Treasurer's
               Certificate described in clause (z) in the first paragraph
               of said SECTION 1 unless the Company shall also deliver to
               the Trustee, together with such other Treasurer's
               Certificate either:

                         i)   an instrument wherein the Company,
                    notwithstanding the satisfaction and discharge of its
                    indebtedness in respect of the such Series 3 Bonds,
                    shall assume the obligation (which shall be absolute
                    and unconditional) to irrevocably deposit with the
                    Trustee such additional sums of money, if any, or
                    additional Government Obligations (meeting the
                    requirements of said SECTION 1 of Article XV), if any,
                    or any combination thereof, at such time or times, as
                    shall be necessary, together with the money and/or
                    Government Obligations theretofore so deposited, to pay
                    when due the principal of such Series 3 Bonds or
                    portions thereof, all in accordance with and subject to
                    the provisions of said SECTION 1; provided, however,
                    that such instrument may state that the obligation of
                    the Company to make additional deposits as aforesaid
                    shall be subject to the delivery to the Company by the
                    Trustee of a notice asserting the deficiency
                    accompanied by an opinion of an Independent public
                    accountant of nationally recognized standing showing
                    the calculation thereof (which opinion shall be
                    obtained at the expense of the Company); or

                         ii)  an Opinion of Counsel to the effect that the
                    Holders of such Series 3 Bonds, 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.


                                      ARTICLE II.

                                      AMENDMENTS


               SECTION 1.     CURRENT AMENDMENTS.

                    The Original Indenture is hereby amended as set forth
               in Schedule C hereto.


               SECTION 2.  PROSPECTIVE AMENDMENTS.

                    The Holder of the Series 3 Bonds shall be deemed to
          have consented to the execution and delivery of a supplemental
          indenture containing one or more, or all, the amendments to the
          Original Indenture set forth in Schedule D hereto.


                                     ARTICLE III

                               MISCELLANEOUS PROVISIONS


               This Supplemental Indenture No. 3 is a supplement to the 
          Original Indenture.  As heretofore supplemented and further           
          supplemented by this Supplemental Indenture No. 3, the Original
          Indenture is in all respects ratified, approved and confirmed,
          and the Original Indenture as heretofore supplemented and this
          Supplemental Indenture No. 3 shall together constitute one and
          the same instrument.
          



               IN WITNESS WHEREOF, Tucson Electric Power Company has caused
          its corporate name to be hereunto affixed, and this instrument to
          be signed by one of its Vice Presidents, and its corporate seal
          to be hereunto affixed and attested by one of its Assistant
          Secretaries for and in its behalf; and Bank of Montreal Trust
          Company, in evidence of its acceptance of the trust hereby
          created, has caused its corporate name to be hereunto affixed,
          and this instrument to be signed by one of its Vice Presidents
          and its corporate seal to be hereunto affixed and attested by one
          of its Vice Presidents for and in its behalf, all as of the day
          and year first above written.


                                        TUCSON ELECTRIC POWER COMPANY


                                        By                                  
                   
                                          ---------------------------------
          
                                          Vice President

          Attest:


                                          
          --------------------------------
          Assistant Secretary


                                        BANK OF MONTREAL TRUST COMPANY,
                                           Trustee


                                        By --------------------------------
          
                                             Peter Morse
                                             Vice President

          Attest:


                                         
          -------------------------------


          STATE OF NEW YORK   )
                              )  ss.:
          COUNTY OF NEW YORK  )

               This instrument was acknowledged before me this 3rd day of
          August, 1998 by KEVIN P. LARSON, a Vice President of TUCSON
          ELECTRIC POWER COMPANY, an Arizona corporation, known to me to be
          the individual who executed this instrument, and known to me to
          be a Vice President of said corporation, and who personally
          acknowledged before me and stated that he executed said
          instrument on behalf of said corporation for the purposes and
          consideration therein expressed.


                                             -----------------------------
                                                       NOTARY PUBLIC



          STATE OF NEW YORK   )
                              )  ss.:
          COUNTY OF NEW YORK  )

               This instrument was acknowledged before me this 3rd day of
          August, 1998 by PETER MORSE, a Vice President of BANK OF MONTREAL
          TRUST COMPANY, a New York banking corporation, known to me to be
          the individual who executed this instrument, and known to me to
          be a Vice President of said corporation, and who personally
          acknowledged before me and stated that he executed said
          instrument on behalf of said corporation for the purposes and
          consideration therein expressed.




                                             ------------------------------




                                                                 SCHEDULE A


                                      

           Supplemental                Securities
             Indenture                     of        Series
                No.      Dated as of   Series No.  Designation
            -----------  -----------   ----------  -----------

                 1       December 1,       1       Second
                         1992                      Mortgage
                                                   Bonds,
                                                   Collateral
                                                   Series A

                 2       December 1,       2       Second
                         1997                      Mortgage
                                                   Bonds,
                                                   Collateral
                                                   Series B




                       Principal Amount


           Authorized     Issued(1) Outstanding(1)
           ----------    --------   -------------

       $ 50,000,000 $ 50,000,000          None
       $543,875,000 $543,875,000    $543,875,000


----------------------------
(1) As of August 4, 1998.


                                                                 SCHEDULE B


                          DESCRIPTION OF MORTGAGED PROPERTY


                                 GENERIC DESCRIPTION

               All electric generating plants, gas generating plant, gas
          holders, steam plant, gas regulating stations, substations and
          other properties of the Company, including all power houses,
          transmission lines, buildings, pipes, structures and works, and
          the lands of the Company on which the same are situated, and all
          the Company's lands, easements, rights, rights-of-way, water
          rights, rights to the use of water, including all of the
          Company's right, title and interest in and to any and all decrees
          therefor, permits, franchises, consents, privileges, licenses,
          poles, towers, wires, switch racks, insulators, pipes, machinery,
          engines, boilers, motors, regulators, meters, tools, appliances,
          equipment, appurtenances and supplies, forming a part of or
          appertaining to said plants, holders, sites, stations or other
          properties, or any of them, or used or enjoyed, or capable of
          being used or enjoyed in conjunction or connection therewith; and

               All electric substations and substation sites of the Company
          including all buildings, structures, towers, poles, lines, and
          all equipment, appliances and devices for transforming,
          converting and distributing electric energy, and all the right,
          title and interest of the Company in and to the land on which the
          same are situated, and all of the Company's lands, easements,
          rights-of-way, rights, franchises, privileges, machinery,
          equipment, fixtures, appliances, devices, appurtenances and
          supplies forming a part of said substation or any of them, or
          used or enjoyed, or capable of being used or enjoyed, in
          conjunction or connection therewith; and

               All warehouses, buildings, structures, works and sites and
          the Company's lands on which the same are situated, and all
          easements, rights-of-way, permits, franchises, consents,
          privileges, licenses, machinery, equipment, furniture and
          fixtures, appurtenances and supplies forming a part of said
          warehouses, buildings, structures, works and sites, or any of
          them, or used or enjoyed or capable of being used or enjoyed in
          connection or conjunction therewith; and

               All electric distribution systems of the Company, including
          towers, poles, wires, insulators, appliances, devices,
          appurtenances and equipment, and all the Company's other
          property, real, personal or mixed, forming a part of, or used,
          occupied or enjoyed in connection with or in any way appertaining
          to said distribution systems, or any of them, together with all
          of the Company's rights-of-way, easements, permits, privileges,
          municipal or other franchises, licenses, consents and rights for
          or relating to the construction, maintenance or operation thereof
          through, over, under or upon any public streets or highways, or
          public or private lands; and also all branches, extensions,
          improvements and developments of or appertaining to or connected
          with said electric distribution systems, or any of them, and all
          other electric distribution systems of the Company and parts
          thereof wherever situated, and whether now owned or hereafter
          acquired, as well as all rights-of-way, easements, privileges,
          permits, municipal or other franchises, consents and rights for
          or relating to the construction, maintenance or operation
          thereof, or any part thereof, through, over, under or upon public
          or private lands, whether now owned or hereafter acquired; and

               All electric transmission and/or distribution lines of the
          Company, including the towers, poles, pole lines, wires, switch
          racks, insulators, supports, guys, telephone and telegraph lines
          and other appliances and equipment, and all other property of the
          Company, real, personal or mixed, forming a part thereof or
          appertaining thereto, together with all of the Company's rights-
          of-way, easements, permits, privileges, municipal or other
          franchises, consents, licenses and rights, for or relating to the
          construction, maintenance or operation thereof, through, over,
          under or upon any public streets or highways or other lands,
          public or private; also all extension, branches, taps,
          developments and improvements of or to any and all of the above
          described transmission and/or distribution lines, telephone and
          telegraph lines or any of them, as well as all rights-of-way,
          easements, permits, privileges, rights and municipal or other
          franchises, licenses and consents, for or relating to the
          construction, maintenance or operation of said lines or any of
          them, or any part thereof, through, over, under or upon any
          public streets or highways or any public or private lands,
          whether now owned or hereafter acquired;

               Excepting, however, any property of the character of
          "Excepted Property" within the meaning of the Supplemental
          Indenture to which this Schedule A is attached.


                   SPECIFIC DESCRIPTION OF ADDITIONAL REAL PROPERTY

                                    [None]




                                           
                                                                 SCHEDULE C


                       CURRENT AMENDMENTS TO ORIGINAL INDENTURE

               (1)(a)    SECTION 2 of Article II of the Original Indenture
          is hereby amended to read as follows:


               SECTION 2.  BONDS ISSUABLE IN SERIES.

                    The Bonds may be issued in one or more series.  Subject
               to the next succeeding paragraph of this SECTION, there
               shall be established by specification in a supplemental
               indenture or in a Certified Resolution, or in a Treasurer's
               Certificate pursuant to a supplemental indenture or a
               Certified Resolution:

                         (a)  the title of the Bonds of such series (which
                    shall distinguish the Bonds of such series from Bonds
                    of all other series);

                         (b)  any limit upon the aggregate principal amount
                    of the Bonds of such series which may be authenticated
                    and delivered under this Indenture (except for Bonds
                    authenticated and delivered upon registration of
                    transfer of, or in exchange for, or in lieu of, other
                    Bonds of such series pursuant to SECTION 6, SECTION 10 
                    or SECTION 11 of this Article, SECTION 6  of Article V
                    or SECTION 6 of Article XIII and except for any Bonds
                    which, pursuant to SECTION 12 of this Article, are
                    deemed never to have been authenticated and delivered
                    hereunder);

                         (c)  the Persons (without specific identification)
                    to whom interest on Bonds of such series, or any
                    Tranche thereof, shall be payable on any Interest
                    Payment Date, if other than the Persons in whose names
                    such Bonds (or one or more Predecessor Bonds) are
                    registered at the close of business on the Regular
                    Record Date for such interest;

                         (d)  the date or dates on which the principal of
                    the Bonds of such series, or any Tranche thereof, is
                    payable or any formulary or other method or other means
                    by which such date or dates shall be determined, by
                    reference to an index or other fact or event
                    ascertainable outside of this Indenture or otherwise
                    (without regard to any provisions for redemption,
                    prepayment, acceleration, purchase or extension); and
                    the right, if any, to extend the Maturity of the Bonds
                    of such series, or any Tranche thereof, and the
                    duration of any such extension;

                         (e)  the rate or rates at which the Bonds of such
                    series, or any Tranche thereof, shall bear interest, if
                    any (including the rate or rates at which overdue
                    principal shall bear interest, if different from the
                    rate or rates at which such Bonds shall bear interest
                    prior to Maturity, and, if applicable, the rate or
                    rates at which overdue premium or interest shall bear
                    interest, if any), or any formulary or other method or
                    other means by which such rate or rates shall be
                    determined, by reference to an index or other fact or
                    event ascertainable outside of this Indenture or
                    otherwise; the date or dates from which such interest
                    shall accrue; the Interest Payment Dates on which such
                    interest shall be payable and the Regular Record Date,
                    if any, for the interest payable on such Bonds on any
                    Interest Payment Date; the basis of computation of
                    interest, if other than as provided in SECTION 8 of
                    this Article; and the right, if any, to extend the
                    interest payment periods and the duration of any such
                    extension;

                         (f)  the place or places at which and/or the
                    methods (if other than as provided elsewhere in this
                    Indenture) by which (i) the principal of and premium,
                    if any, and interest, if any, on Bonds of such series,
                    or any Tranche thereof, shall be payable, (ii)
                    registration of transfer of Bonds of such series, or
                    any Tranche thereof, may be effected, (iii) exchanges
                    of Bonds of such series, or any Tranche thereof, may be
                    effected and (iv) notices and demands to or upon the
                    Company in respect of the Bonds of such series, or any
                    Tranche thereof, and this Indenture may be served; and,
                    if such is the case, that the principal of such Bonds
                    shall be payable without the presentment or surrender
                    thereof;

                         (g)  the period or periods within which or the
                    date or dates on which, the price or prices at which
                    and the terms and conditions upon which the Bonds of
                    such series, or any Tranche thereof, may be redeemed,
                    in whole or in part, at the option of the Company;

                         (h)  the obligation or obligations, if any, of the
                    Company to redeem or purchase the Bonds of such series,
                    or any Tranche thereof, pursuant to any sinking fund or
                    other mandatory redemption provisions or at the option
                    of a Holder thereof and the period or periods within
                    which or the date or dates on which, the price or
                    prices at which and the terms and conditions upon which
                    such Bonds shall be redeemed or purchased, in whole or
                    in part, pursuant to such obligation, and applicable
                    exceptions to the requirements of SECTION 4 of Article
                    IV in the case of mandatory redemption or redemption at
                    the option of the Holder;

                         (i)  the denominations in which Bonds of such
                    series, or any Tranche thereof, shall be issuable if
                    other than denominations of One Thousand Dollars
                    ($1,000) and any integral multiple thereof;

                         (j)  the currency or currencies, including com-
                    posite currencies, in which payment of the principal of
                    and premium, if any, and interest, if any, on the Bonds
                    of such series, or any Tranche thereof, shall be
                    payable (if other than in Dollars); and the formulary
                    or other method or other means by which the equivalent
                    of any such amount in Dollars is to be determined for
                    any purpose, including for the purpose of determining
                    the principal amount of such Bonds deemed to be
                    Outstanding at any time; it being understood that, for
                    purposes of calculations under this Indenture
                    (including calculations under Articles I and III), any
                    amounts denominated in a currency other than Dollars or
                    in a composite currency shall be converted to Dollar
                    equivalents by calculating the amount of Dollars which
                    could have been purchased by the amount of such other
                    currency based on such quotations or methods of
                    determination as shall be specified pursuant to this
                    clause; provided, however, that the instrument
                    establishing the Bonds of such series or Tranche shall
                    contain provisions substantially to the effect that if,
                    at any time when the principal of such Bonds, together
                    with premium, if any, and accrued interest, if any,
                    thereon, shall be due and payable or at any time when
                    there shall be a determination by a court of competent
                    jurisdiction of the extent to which the obligations of
                    the Company in respect of the Bonds then Outstanding or
                    otherwise under this Indenture are deemed to be secured
                    obligations of the Company, the amount of Dollars into
                    which an amount equal to the principal of such Bonds
                    could be converted under then current currency exchange
                    rates exceeds the amount of Dollars into which an
                    amount equal to the principal of such Bonds have been
                    converted under currency exchange rates prevailing at
                    the time of the initial authentication and delivery of
                    such Bonds, then the Company's obligation to pay such
                    excess amount in respect of principal, together with
                    the associated excess amounts in respect of premium, if
                    any, and accrued interest, if any, shall be deemed to
                    be secured by and entitled to the benefit of the Lien
                    of this Indenture only to the extent that any proceeds
                    of sale of the Trust Estate and/or any other assets of
                    the Company subject to such Lien shall exceed the
                    amount necessary to pay, satisfy and discharge, or duly
                    provide therefor, all other obligations of the Company
                    on the Bonds then Outstanding or otherwise under this
                    Indenture; and, to the extent of any inconsistency
                    between such provisions so contained in such instrument
                    and any other provision of this Indenture, such
                    provisions of such instrument shall control;

                         (k)  if the principal of or premium, if any, or
                    interest, if any, on the Bonds of such series, or any
                    Tranche thereof, are to be payable, at the election of
                    the Company or a Holder thereof, in a coin or currency
                    other than that in which the Bonds are stated to be
                    payable, the coin or currency in which payment of any
                    amount as to which such election is made will be
                    payable, the period or periods within which, and the
                    terms and conditions upon which, such election may be
                    made; it being understood that, for purposes of
                    calculations under this Indenture (including
                    calculations under Articles I and III), any such
                    election shall be required to be taken into account, in
                    the manner contemplated in clause (j) of this
                    paragraph, only after such election shall have been
                    made; provided, however, the instrument establishing
                    the Bonds of such series or Tranche shall contain
                    provisions having substantially the same effect as the
                    provisions described in the proviso to clause (j) of
                    this paragraph;

                         (l)  if the principal of or premium, if any, or
                    interest, if any, on the Bonds of such series, or any
                    Tranche thereof, are to be payable, or are to be
                    payable at the election of the Company or a Holder
                    thereof, in securities or other property, the type and
                    amount of such securities or other property, or the
                    formulary or other method or other means by which such
                    amount shall be determined, and the period or periods
                    within which, and the terms and conditions upon which,
                    any such election may be made; it being understood that
                    all calculations under this Indenture (including
                    calculations under Articles I and III) shall be made on
                    the basis of the fair market value of such securities
                    or the fair value of such other property, in either
                    case determined as of the most recent practicable date,
                    except that, in the case of any amount of principal or
                    interest that may be so payable at the election of the
                    Company or a Holder, if such election shall not yet
                    have been made, such calculations shall be made on the
                    basis of the amount of principal or interest, as the
                    case may be, that would be payable if no such election
                    were made; provided, however, the instrument
                    establishing the Bonds of such series or Tranche shall
                    contain provisions having substantially the same effect
                    as the provisions described in the proviso to clause
                    (j) of this paragraph;

                         (m)  if the amount payable in respect of principal
                    of or premium, if any, or interest, if any, on the
                    Bonds of such series, or any Tranche thereof, may be
                    determined with reference to an index or other fact or
                    event ascertainable outside of this Indenture, the
                    manner in which such amounts shall be determined (to
                    the extent not established pursuant to clause (e) of
                    this paragraph); it being understood that all
                    calculations under this Indenture (including
                    calculations under Articles I and III) shall be made on
                    the basis of the amount that would be payable as
                    principal if such principal were due, or on the basis
                    of the interest rates in effect, as the case may be, on
                    the date next preceding the date of such calculation;
                    provided, however, the instrument establishing the
                    Bonds of such series or Tranche shall contain
                    provisions having substantially the same effect as the
                    provisions described in the proviso to clause (j) of
                    this paragraph;

                         (n)  if other than the principal amount thereof,
                    the portion of the principal amount of Bonds of such
                    series, or any Tranche thereof, which shall be payable
                    upon declaration of acceleration of the Maturity
                    thereof pursuant to SECTION 3 of Article VIII;
                    
                         (o)  the terms, if any, pursuant to which the
                    Bonds of such series, or any Tranche thereof, may be
                    converted into or exchanged for shares of capital stock
                    or other securities of the Company or any other Person;

                         (p)  the obligations or instruments, if any, which
                    shall be considered to be Eligible Obligations in
                    respect of the Bonds of such series, or any Tranche
                    thereof, denominated in a currency other than Dollars
                    or in a composite currency, and any additional or
                    alternative provisions for the reinstatement of the
                    Company's indebtedness in respect of such Bonds after
                    the satisfaction and discharge thereof as provided in
                    SECTION 1 of Article XV;

                         (q)  if the Bonds of such series, or any Tranche
                    thereof, are to be issued in global form, (i) any
                    limitations on the rights of the Holder or Holders of
                    such Bonds to transfer or exchange the same or to
                    obtain the registration of transfer thereof, (ii) any
                    limitations on the rights of the Holder or Holders
                    thereof to obtain certificates therefor in definitive
                    form in lieu of temporary form and (iii) any and all
                    other matters incidental to such Bonds;

                         (r)  if the Bonds of such series, or any Tranche
                    thereof, are to be issuable as bearer securities, any
                    and all matters incidental thereto which are not
                    specifically addressed in a supplemental indenture as
                    contemplated by clause (f) of SECTION 2 of Article
                    XIII;

                         (s)  to the extent not established pursuant to
                    clause (q) of this paragraph, any limitations on the
                    rights of the Holders of the Bonds of such Series, or
                    any Tranche thereof, to transfer or exchange such Bonds
                    or to obtain the registration of transfer thereof; and
                    if a service charge will be made for the registration
                    of transfer or exchange of Bonds of such series, or any
                    Tranche thereof, the amount or terms thereof;

                         (t)  any exceptions to SECTION 13 of Article XVI
                    with respect to the Bonds of such series, or any
                    Tranche thereof; and

                         (u)  any other terms of the Bonds of such series,
                    or any Tranche thereof.

                    With respect to Bonds of a series subject to a Periodic
               Offering, the indenture supplemental hereto, Certified
               Resolution or Treasurer's Certificate which establishes such
               series may provide general terms or parameters for Bonds of
               such series and provide either that the specific terms of
               Bonds of such series, or any Tranche thereof, shall be
               specified in a Written Order or that such terms shall be
               determined by the Company or its agents in accordance with
               procedures specified therein or to be specified in a Written
               Order.

                    The form of the Bonds of each series, or any Tranche
               thereof, shall be set forth in a supplemental indenture,
               Certified Resolution or Treasurer's Certificate.

                    (b)  SECTION 1 of Article I of the Original Indenture
          is hereby amended to include therein the following additional
          definitions:

                    "DOLLAR" or "$" shall mean a dollar or other equivalent
               unit in such coin or currency of the United States of
               America as at the time shall be legal tender for the payment
               of public and private debts.

                    "ELIGIBLE OBLIGATIONS" shall mean:

                         (a)  with respect to Bonds denominated in Dollars,
                    Government Obligations; or

                         (b)  with respect to Bonds denominated in a
                    currency other than Dollars or in a composite currency,
                    such other obligations or instruments as shall be
                    specified with respect to such Securities as
                    contemplated by SECTION 2 of Article II.

                    "INTEREST PAYMENT DATE", when used with respect to any
               Bond, shall mean the Stated Maturity of an installment of
               interest on such Bond.

                    "MATURITY", when used with respect to any Bond, shall
               mean the date on which the principal of such Bond or an
               installment of principal becomes due and payable as provided
               in such Bond or in this Indenture, whether at the stated
               maturity, by declaration of acceleration, upon call for
               redemption or otherwise.

                    "STATED MATURITY", when used with respect to any
               obligation or any installment of principal thereof or
               interest thereon, shall mean the date on which the principal
               of such obligation or such installment of principal or
               interest is stated to be due and payable (without regard to
               any provisions for redemption, prepayment, acceleration,
               purchase or extension).

                    (c)  Article XV of the Original Indenture is hereby
          amended by substituting the term "Eligible Obligations" for the
          term "Government Obligations" wherever in such Article the latter
          term currently appears.

               (2)  The definition of the term "Retired Bond" in SECTION 2
          of Article I of the Original Indenture is hereby amended to read
          as follows:

                    "RETIRED BOND" shall mean, as of any time, (a) any Bond
               authenticated and delivered under this Indenture which no
               longer remains Outstanding by reason of the applicability of
               clause (a)  or (b) in the definition of "OUTSTANDING" (other
               than any Predecessor Bond of any Bond), provided, however,
               that no Bond which shall have ceased to be Outstanding prior
               to the Initial Certification Date shall be deemed to be a
               Retired Bond unless such Bond shall have been included in
               the Initial Engineer's Certificate as if such Bond had been
               Outstanding at the Initial Certification Date; and (b) any
               bond authenticated and delivered under the 1941 Mortgage
               which at such time could be used as the basis for the
               authentication and delivery of additional bonds pursuant to
               SECTION 7 of Article III of the 1941 Mortgage, provided,
               however, that (x) no bond which shall have ceased to be
               "outstanding" under the 1941 Mortgage prior to the Initial
               Certification Date shall be deemed to be a Retired Bond
               unless such bond shall have been included in the Initial
               Engineer's Certificate as if such bond had been
               "outstanding" at the Initial Certification Date and (y) any
               bond which shall have ceased to be "outstanding" under the
               1941 Mortgage on or after the Initial Certification Date and
               could otherwise have been used under SECTION 7 of Article
               III of the 1941 Mortgage shall be deemed to be a Retired
               Bond notwithstanding any subsequent satisfaction and
               discharge of the 1941 Mortgage.

               (3)  Subdivision (9) of SECTION 6 of Article III of the
          Original Indenture is hereby amended to read as follows:

                    (9)  An Engineer's Certificate, made and dated not more
               than 10 days prior to the date of such application, stating
               that the signers have no knowledge of and do not believe
               that there have been, since the close of the period covered
               by the Engineer's Certificate specified in subdivision (3)
               above, Property Retirements in an amount which (after
               reduction of such amount by amounts of the character
               referred to in Clause (D) of subdivision 3 in respect of
               such Property Retirements) exceeds the amount of Property
               Additions since the close of such period by more than the
               amount of the Unapplied Balance of Property Additions
               calculated to be remaining upon the granting of the
               application (before any reduction of such Unapplied Balance
               of Property Additions by any amount of Net Property
               Additions applied to the withdrawal of cash deposited with
               the Trustee in connection with such Property Retirements).

               (4)  Subdivision (2) of SECTION 7 of Article III of the
          Original Indenture is hereby amended to read as follows:

                    (2)  A Treasurer's Certificate stating (a) that the
               Company is not to the best of the knowledge and belief of
               the signers in default under any of the provisions of this
               Indenture and (b) that Bonds theretofore authenticated an
               delivered under this Indenture, and/or bonds, theretofore
               authenticated and delivered under the 1941 Mortgage, of a
               specified aggregate principal amount (not less than the
               aggregate principal amount of Bonds for which such request
               for authentication and delivery is made under this SECTION)
               constitute Retired Bonds; and further stating that no part
               of such Retired Bonds has been theretofore made the basis
               under any of the provisions of this Indenture or the 1941
               Mortgage for the authentication and delivery of Bonds
               hereunder or bonds under the 1941 Mortgage, or the
               withdrawal of cash or the release of any property and that
               none of such Retired Bonds has been retired by the use of
               the proceeds of any insurance on any Funded Property (or
               "funded property" under the 1941 Mortgage) or the proceeds
               of the release or other disposition of any part of the
               Funded Property (or "funded property" under the 1941
               Mortgage), or through the operation of any sinking fund or
               other fund applicable to the retirement thereof, except to
               the extent, if any, that the provisions establishing such
               fund expressly permit the issuance of (x) Bonds under this
               SECTION in respect of Bonds retired through the operation of
               such fund or (y) bonds under SECTION 7 of Article III of the
               1941 Mortgage in respect of bonds retired through the
               operation of such fund; and further stating the interest
               rate or rates and the maturity date or dates borne by all
               such Retired bonds.  

               (5)  SECTION 2 of Article XIII of the Original Indenture is
          hereby amended to add at the end thereof a new paragraph reading
          as follows:

                    Anything in this Indenture to the contrary
               notwithstanding, if the instrument creating the Bonds of any
               series or Tranche shall so provide, (a) the Holders of such
               Bonds shall be deemed to have consented to a supplemental
               indenture containing the additions, changes or eliminations
               to or from the Indenture which shall be specified in such
               instrument, (b) no action on the part of such Holders shall
               be required to evidence such consent and (c) such consent
               may be counted in the determination of whether or not the
               Holders of the requisite principal amount of Bonds shall
               have consented to such supplemental indenture.
             
               (6)  Subsection (d) of SECTION 8 of Article XIV of the
          Original Indenture is hereby amended adding at the end thereof
          the following:

               Any such request, demand, authorization, direction, notice,
               consent, waiver or other act, given or made as aforesaid,
               shall be effective whether or not the Holders which
               authorized or agreed or consented to the same remain Holders
               after such record date and whether or not the Bonds held by
               such Holders remain Outstanding after such record date.

                    SECTION 1 of Article XV of the Original Indenture is
          hereby amended by:

                    (a)  deleting the word "and" from the end of clause (x)
          in the first paragraph thereof;

                    (b)  deleting the period at the end of clause (y) in
          the first paragraph thereof and adding at the end of clause (y)
          "; and";

                    (c)  adding a new clause (z) at the end of the first
          paragraph reading as follows:

                         (z)  if such deposit shall have been made prior to
                    the maturity or redemption date of such Bonds, a
                    Treasurer's Certificate stating the Company's intention
                    that, upon delivery of such Treasurer's Certificate,
                    its indebtedness in respect of such Bonds or portions
                    thereof will have been satisfied and discharged as
                    contemplated in this SECTION.

                    (d)  deleting the second paragraph thereof and
          substituting therefor a new second paragraph reading as follows:

                         Upon receipt by the Trustee of money or Eligible
          Obligations, or both, in accordance with this SECTION, together
          with the documents required by clauses (x), (y) and (z) above,
          the Trustee shall, upon Written Request, acknowledge in writing
          that such Bonds or portions thereof are deemed to have been paid
          for all purposes of this Indenture and that the entire
          indebtedness of the Company in respect thereof has been satisfied
          and discharged as contemplated in this SECTION.  In the event
          that all of the conditions set forth in the preceding paragraph
          shall have been satisfied in respect of any Bonds or portions
          thereof except that, for any reason, the Treasurer's Certificate
          specified in clause (z) (if otherwise required) shall not have
          been delivered, such Bonds or portions thereof shall nevertheless
          be deemed to have been paid for all purposes of this Indenture,
          and the Holders of such Bonds or portions thereof shall
          nevertheless be no longer entitled to the benefit of the Lien of
          this Indenture or of any of the covenants of the Company under
          Article IV (except the covenants contained in SECTIONs 2, 3 and 4
          thereof) or any other covenants made in respect of such Bonds or
          portions thereof, but the indebtedness of the Company in respect
          of such Bonds or portions thereof shall not be deemed to have
          been satisfied and discharged for any other purpose; and, upon
          Written Request, the Trustee shall acknowledge in writing that
          such Bonds or portions thereof are deemed to have been paid for
          all purposes of this Indenture.

               (7)  SECTION 1 of Article VIII of the Original Indenture is
          hereby amended to:

                    (a)  insert "; or" at the end of clause (f) therein;
               and

                    (b)  add immediately following clause (f) the
               following:

                         "(g) so long as the trustee under the
                         Indenture, dated as of August 1, 1998 as the
                         same may be amended and supplemented (the
                         `1998 Indenture'), from the Company to Bank
                         of Montreal Trust Company, as trustee (the
                         `1998 Indenture Trustee'), shall hold any
                         bonds outstanding hereunder which were
                         delivered to the 1998 Indenture Trustee as
                         the basis for the authentication and delivery
                         of securities under the 1998 Indenture which
                         remain outstanding thereunder, an `Event of
                         Default' under the 1998 Indenture; provided,
                         however, that, anything in this Indenture to
                         the contrary notwithstanding, the waiver or
                         cure of such `Event of Default' and the
                         rescission and annulment of the consequences
                         thereof shall constitute a cure of the
                         corresponding default under Indenture and a
                         rescission and annulment of the consequences
                         thereof."

                          


                                                                 SCHEDULE D

                     PROSPECTIVE AMENDMENTS TO ORIGINAL INDENTURE

                    1.   The amendment of SECTION 2 of Article I of the
               Original Indenture to add thereto a definition of the term
               "fair value" substantially to the following effect:

                         "FAIR VALUE", with respect to property, means the
                    fair value of such property as may be determined by
                    reference to (a) the amount which would be likely to be
                    obtained in an arm's-length transaction with respect to
                    such property between an informed and willing buyer and
                    an informed and willing seller, under no compulsion,
                    respectively, to buy or sell, (b) the amount of
                    investment with respect to such property which,
                    together with a reasonable return thereon, would be
                    likely to be recovered through ordinary business
                    operations or otherwise, (c) the Cost, accumulated
                    depreciation and replacement cost with respect to such
                    property and/or (d) any other relevant factors;
                    provided, however, that (x) the fair value of property
                    shall be determined without deduction for any Prior
                    Liens on such property (except as otherwise provided in
                    clause (2) of subparagraph (C) of SECTION 3 of Article
                    VII and (y) the fair value to the Company of Property
                    Additions shall not reflect any reduction relating to
                    the fact that such Property Additions may be of less
                    value to a Person which is not the owner or operator of
                    the Mortgaged Property or any portion thereof than to a
                    Person which is such owner or operator.  Fair value may
                    be determined, without physical inspection, by the use
                    of accounting and engineering records and other data
                    maintained by the Company or otherwise available to the
                    Engineer certifying the same.

                    2.   The amendment of SECTION 2 of Article I of the
               Original Indenture to add thereto definitions of the terms
               "purchase money mortgage" and "purchase money obligations"
               substantially to the following effect:

                         "PURCHASE MONEY MORTGAGE" means, with respect to
                    any property being acquired or disposed of by the
                    Company or being released from the Lien of this
                    Indenture, a lien on such property which

                              (a) is taken or retained by the transferor of
                         such property to secure all or part of the
                         purchase price thereof;

                              (b) is granted to one or more Persons other
                         than the transferor which, by making advances or
                         incurring an obligation, give value to enable the
                         grantor of such lien to acquire rights in or the
                         use of such property;

                              (c)  is granted to any other Person in
                         connection with the release of such property from
                         the Lien of this Indenture on the basis of the
                         deposit with the Trustee or the trustee or other
                         holder of a Prior Lien  of obligations secured by
                         such lien on such property (as well as any other
                         property subject thereto);

                              (d) is held by a trustee or agent for the
                         benefit of one or more Persons described in clause
                         (a), (b) and/or (c) above, provided that such lien
                         may be held, in addition, for the benefit of one
                         or more other Persons which shall have theretofore
                         given, or may thereafter give, value to or for the
                         benefit or account of the grantor of such lien for
                         one or more other purposes; or

                              (e) otherwise constitutes a purchase money
                         mortgage or a purchase money security interest
                         under applicable law;

                    and, without limiting the generality of the foregoing,
                    for purposes of this Indenture, the term shall be
                    deemed to include any lien described above whether or
                    not such lien (x) shall permit the issuance or other
                    incurrence of additional indebtedness secured by such
                    lien on such property, (y) shall permit the subjection
                    to such lien of additional property and the issuance or
                    other incurrence of additional indebtedness on the
                    basis thereof and/or (z) shall have been granted prior
                    to the acquisition, disposition or release of such
                    property, shall attach to or otherwise cover property
                    other than the property being acquired, disposed of or
                    released and/or shall secure obligations issued prior
                    and/or subsequent to the issuance of the obligations
                    delivered in connection with such acquisition,
                    disposition or release.  The term "PURCHASE MONEY
                    OBLIGATION" shall mean an obligation secured by a
                    purchase money lien.

                    3.   The amendment of clause (b) in subdivision (1) of
               SECTION 9 of Article VII or the Original Indenture to read
               as follows:

                              (b)  in an amount equal to ten-sevenths
                         (10/7ths) of the principal amount of Bonds to the
                         authentication and delivery of which the Company
                         is entitled under the provisions of SECTION 7 of
                         Article III hereof.

                    4.   The amendment of subparagraph E in the first
               paragraph of SECTION 3 of Article VIII of the Original
               Indenture to:

                         (i)  to delete therefrom the second proviso or to
                    provide that the second proviso may be disregarded upon
                    specified conditions; or

                         (ii) to delete from the second proviso therein the
                    phrase "fifteen per centum (15%) of "; or

                         (iii)     to change the phrase "fifteen per centum
                    (15%)" in the second proviso therein to any higher
                    percentage not exceeding one hundred per centum (100%).

                    5.   The amendment of SECTION 7 of Article III of the
          Original Indenture to change the semi-colon at the end of clause
          (5) in the first paragraph thereof to a period and to delete the
          remainder of said first paragraph. 





                                                                  EXHIBIT A

                                    [Form of Bond]
                           (See legends at the end of this
                         Bond for restrictions on transfer.)



          No. ---------------                                  $-----------


                            TUCSON ELECTRIC POWER COMPANY

                   FIRST MORTGAGE BOND, COLLATERAL SERIES DUE 2008

                                  DUE AUGUST 1, 2008

               TUCSON ELECTRIC POWER COMPANY, a corporation of the State of
          Arizona (hereinafter sometimes called the Company), for value
          received, promises to pay to

          or registered assigns, the principal sum of               DOLLARS

          on August 1, 2008, in coin or currency of the United States of
          America which at the time of payment shall be legal tender for
          the payment of public and private debts, at the office or agency
          of the Company in The City of New York, or in the City of Tucson,
          Arizona, upon presentation hereof.  This Bond shall not bear
          interest.

               This bond is one of an issue of bonds of the Company, issued
          and to be issued in one or more series under and equally and
          ratably secured (except as any sinking, amortization,
          improvement, renewal or other fund, established in accordance
          with the provisions of the indenture hereinafter mentioned, may
          afford additional security for the bonds of any particular
          series) by the Indenture of Mortgage and Deed of Trust, dated as
          of December 1, 1992 (the "Original Indenture"), from the Company
          to Bank of Montreal Trust Company, trustee (the "Trustee"), as
          supplemented by various supplemental indentures including
          Supplemental Indenture No. 3, dated as of August 1, 1998 (the
          Original Indenture, as so supplemented, and such Supplemental
          Indenture being hereinafter called the "Indenture" and
          "Supplemental Indenture No. 3", respectively), to which Indenture
          reference is hereby made for a description of the property
          mortgaged and pledged, the nature and extent of the security
          provided by the Indenture, the rights and limitations of rights
          of the Company, the Trustee and the holders of said bonds with
          respect to the security provided by the Indenture, the powers,
          duties and immunities of the Trustee, the terms and conditions
          upon which such bonds are and are to be secured, and the
          circumstances under which additional bonds may be issued. 
          The acceptance of this bond shall be deemed to constitute the   
          consent and agreement by the holder hereof to all of the terms
          and provisions of the Indenture.  This bond is one of a series of
          bonds designated as the First Mortgage Bonds, Collateral Series
          due 2008, of the Company.

               The Indenture permits, with certain exceptions as therein
          provided, the Trustee to enter into one or more supplemental
          indentures for the purpose of adding any provisions to, or
          changing in any manner or eliminating any of the provisions of,
          the Indenture with the consent of the holders of not less than
          sixty per centum (60%) in aggregate principal amount of the bonds
          of all series then outstanding under the Indenture, considered as
          one class; provided, however, that if there shall be bonds of
          more than one series outstanding under the Indenture and if a
          proposed supplemental indenture shall directly affect the rights
          of the holders of bonds of one or more, but less than all, of
          such series, then the consent only of the holders of bonds in
          aggregate principal amount of the outstanding bonds of all series
          so directly affected, considered as one class, shall be required;
          and provided, further, that if the bonds of any series shall have
          been issued in more than one tranche and if the proposed
          supplemental indenture shall directly affect the rights of the
          holder of bonds of one or more, but less than all, of such
          tranches, then the consent only of the holders of bonds in
          aggregate principal amount of the outstanding bonds of all
          tranches so directly affected, considered as one class, shall be
          required; and provided, further, that the Indenture permits the
          Trustee to enter into one or more supplemental indentures for
          limited purposes without the consent of any holders of bonds. 
          Any such consent by the holder of this bond shall be conclusive
          and binding upon such holder and upon all future holders of this
          bond and of any bond issued upon the registration of transfer
          hereof or in exchange therefor or in lieu hereof, whether or not
          notation of such consent is made upon this bond.  The holders of
          this bond shall be deemed to have consented to certain amendments
          to the Indenture which are specified in Supplemental Indenture
          No. 3.

               The bonds of this series are being issued and delivered by
          the Company to Bank of Montreal Trust Company, as trustee under
          the Indenture, dated as of August 1, 1998, as supplemented (the
          "1998 Indenture"), of the Company to such trustee (the "1998
          Indenture Trustee"), in exchange for other obligations of the
          Company which have heretofore been delivered to the 1998
          Indenture Trustee, as the basis for the authentication and
          delivery of securities under the 1998 Indenture.  As provided in
          the 1998 Indenture, the bonds of this series are to be registered
          in the name of the 1998 Indenture Trustee or its nominee and will
          be owned and held by the 1998 Indenture Trustee, subject to the
          provisions of the 1998 Indenture, for the benefit of the holders
          of all securities from time to time outstanding under the 1998
          Indenture, and the Company shall have no interest therein.  The
          bonds of this series shall not be transferable except as required
          to effect transfer to any successor trustee under the 1998
          Indenture.

               Anything herein to the contrary notwithstanding, any payment
          by the Company under the 1998 Indenture of the principal of the
          securities which shall have been authenticated and delivered
          under the 1998 Indenture on the basis of the delivery to the 1998
          Indenture Trustee of bonds of this series (other than by the
          application of the proceeds of a payment in respect of such bonds
          of this series) shall, to the extent thereof, be deemed to
          satisfy and discharge the obligation of the Company, if any, to
          make a payment of principal of such bonds of this series which is
          then due.

               The bonds of this series are redeemable prior to maturity at
          the option of the Company, as a whole at any time or in part from
          time to time, at the principal amount of bonds so to be redeemed.


               Notice of redemption shall be given by mail to the holders
          of bonds of this series, not less than 30 nor more than 60 days
          prior to the redemption date.  As provided in the Indenture,
          notice of redemption may state that such redemption shall be
          conditional upon the receipt by the Trustee, on or prior to the
          date fixed for redemption, of money sufficient to pay the
          principal of this bond; a notice of redemption so conditioned
          shall be of no force or effect if such money is not so received
          and, in such event, the Company shall not be required to redeem
          this bond.

               In the event of redemption of this bond in part only, a new
          bond or bonds of this series, of like tenor, for the unredeemed
          portion hereof will be issued to the holder hereof upon the
          surrender hereof.

               The principal of this bond may become or be declared due and
          payable before the stated maturity hereof, on the conditions, in
          the manner and at the times set forth in the Indenture, upon the
          happening of a default as therein provided.

               This bond is non-transferable except as required to effect
          transfer to any successor trustee under the 1998 Indenture, any
          such transfer to be registered at the office or agency of the
          Company in The City of New York, upon surrender of this bond by
          the registered owner hereof or by attorney authorized in writing,
          and upon any such registration of transfer a new bond of this
          series, for the same aggregate principal amount and having the
          same stated maturity date, will be issued to the transferee in
          exchange herefor.  Prior to due presentment for registration of
          transfer, the Company and the Trustee may deem and treat the
          person in whose name this bond is registered as the absolute
          owner hereof for the purpose of receiving payment and for all
          other purposes.  This bond, alone or with other bonds of this
          series, may in like manner be exchanged at such office or agency
          for one or more bonds of this series of the same aggregate
          principal amount and having the same stated maturity date and
          interest rate, all as provided in the Indenture.

               As provided in the Indenture and subject to certain
          limitations therein set forth, this Bond or any portion of the
          principal amount hereof will be deemed to have been paid for all
          purposes of the Indenture and to be no longer Outstanding
          thereunder, and the Company's entire indebtedness in respect
          thereof will be deemed to have been satisfied and discharged, if
          there has been irrevocably deposited with the Trustee or any
          Paying Agent (other than the Company), in trust, money in an
          amount which will be sufficient, and/or Government Obligations,
          the principal of and interest on which when due, without regard
          to any reinvestment thereof, will provide moneys which, together
          with moneys so deposited, will be sufficient, to pay when due the
          principal of and interest on this bond when due.

               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, against any
          incorporator, shareholder, director or officer, as such, past,
          present or future, of the Company or of any predecessor or
          successor corporation, either directly or through the Company or
          any predecessor or successor corporation, whether by virtue of
          any constitution, statute or rule of law, or by the enforcement
          of any assessment or penalty or by any legal or equitable
          proceeding or otherwise howsoever (including, without limiting
          the generality of the foregoing, any proceeding to enforce any
          claimed liability of shareholders of the Company, based upon any
          theory of disregarding the corporate entity of the Company or
          upon any theory that the Company was acting as the agent or
          instrumentality of the shareholders); all such liability being,
          by the acceptance hereof and as a part of the consideration for
          the issuance hereof, expressly waived and released by every
          holder hereof, and being likewise waived and released by the
          terms of the Indenture under which this bond is issued, as more
          fully provided in said Indenture.

               This bond shall not be valid or become obligatory for any
          purpose until the certificate of authentication hereon shall have
          been signed by Bank of Montreal Trust Company, or its successor,
          as Trustee under the Indenture.

               IN WITNESS WHEREOF, the Company has caused this bond to be
          signed 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 impressed or imprinted hereon and
          attested by the manual by the manual or facsimile signature of   
          its Secretary or one of its Assistant Secretaries.

               Dated 

                                        TUCSON ELECTRIC POWER COMPANY


                                        By:  
                                             -------------------------
          Attest:

                                          
          -------------------



                  [FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]

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

                                        BANK OF MONTREAL TRUST COMPANY,
                                          as Trustee


                                        By:                                 
                                           --------------------------------
                                           Authorized Signature