KENTUCKY ELECTRIC STEEL, INC.

SPLIT DOLLAR INSURANCE AGREEMENT

	THIS AGREEMENT made on the 1st day of September, 1998, by and between 
Kentucky Electric Steel, Inc., a corporation  (hereinafter called the 
"Company") and ____________________, (hereinafter called the 
"executive").

WITNESSETH

	WHEREAS, ___________________ is a valuable and experienced Executive 
of the Company; and

	WHEREAS, the Company whishes to set up a split-dollar arrangement in 
order to provide insurance protection for Executive's benefit; and

	WHEREAS, in furtherance of the relationship of the Company and 
Executive, the Company desires to enter into an agreement with respect to 
the payment of premiums of any policy(s) purchased under the terms of this 
Agreement in order to provide such insurance protection;

	NOW THEREFORE, the parties mutually agree as follows:

1. OWNERSHIP AND PURCHASE OF INSURANCE: The Company owns a life insurance 
policy issued by Pacific Life (the "Insurer"), policy number 
_____________, on Executive's life.  The parties hereto agree that 
any policy purchased under the terms of this Agreement shall be 
subject to the terms and conditions of this Agreement and of the 
endorsement filed with the Insurer relating to the policy.

2. BENEFICIARY PROVISION.  The beneficiary provisions of any policy 
purchased under the terms of this Agreement shall provide that, upon 
Executive's death, the total combined proceeds shall be paid as 
follows:

A. An amount equal to $_____________ to the beneficiaries 
designated by Executive in the manner and in the amounts 
provided in the beneficiary designation provision of any policy 
purchased under the terms of this Agreement.  Executive shall 
have the absolute right during the terms of this Agreement to 
designate beneficiaries for the above portion of the death 
benefit provided under any policy purchased under the terms of 
this Agreement.  The parties agree that the beneficiary 
designation provision of any policy purchased under the terms 
of this Agreement shall conform to the provisions of this 
Agreement.

B. To the Company, the portion of the proceeds in excess of  
$________________.

3. OWNERSHIP.  Except for Executive's right to designate or change the 
beneficiary of any policy purchased under the terms of this Agreement 
as to the amount provided in paragraph 2.A hereof, the Company shall 
be the sole and absolute owner of the policy, and may exercise all 
other ownership rights granted to the owner by the terms of the 
policy.
4. DIVIDENDS.  Any policy purchased under the terms of this Agreement 
shall provide that dividends are to be applied to purchase 
additional, paid-up insurance on Executive's life.  The parties 
hereto agree that the dividend election provision of the policy shall 
conform to the provisions of this Agreement.

5. PREMIUMS.  Premiums on any policy purchased under the terms of this 
Agreement shall be paid by the Company as they become due.  The 
Company shall furnish Executive a statement of the amount of income 
reportable by Executive for Executive's federal and state income tax 
purposes as a result of its payment of the premiums.

6. TERMINATION OF AGREEMENT.  Either party hereto, with or without the 
consent of the other, may terminate this Agreement by giving notice 
of termination in writing.  This Agreement shall terminate, without 
notice, upon the first to occur of the following: (a) the total 
cessation of the business of the Company; (b) the bankruptcy, 
receivership or dissolution of the Company; or (c) the termination of 
Executive's employment for any reason other than death.  Subject to 
the provision of this section, upon termination of the Agreement, the 
Company shall have the right to surrender or cancel any policy(s) 
purchased under the terms of this Agreement and retain proceeds 
hereof.

7. AMENDMENTS.  Amendments may be made to this Agreement by a written 
agreement signed by each of the parties and attached hereto.  
Additional policies of insurance on Executive's life may be purchased 
under this Agreement by amendment to paragraph 1 hereof.

8. LIMITATION OF RIGHTS.  This Agreement shall not give Executive any 
right or claim except to the extent that such right is specifically 
fixed under the terms of the Agreement.  This Agreement shall not be 
construed to give Executive a right to be continued in the employ of 
the Company or as interfering with the right of the Company to 
terminate Executive's employment at any time.

9. EFFECT OF AGREEMENT.  This Agreement shall be binding upon and inure 
to the benefit of the Company and its successors and assigns, and 
Executive and his respective successors, assigns, heirs, executors, 
administrators and beneficiaries.

10. GOVERNING LAW.  This Agreement shall be governed and constructed in 
accordance with the laws of the Commonwealth of Kentucky.

IN WITNESS WHEREOF, the parties have caused this Agreement to be 
executed as of the date first above written.



ATTEST: 				      KENTUCKY ELECTRIC STEEL, INC.

_____________________	            By:__________________________
Secretary						


_____________________	            By:__________________________
Witness							


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Kentucky Electric Steel, Inc.
Supplemental Schedule for Exhibit 10.20
Split Dollar Insurance Agreement
<CAPTION>









Life 
Insurance 
Pre-
retirement
Name
Title
Policy 
Number
Death 
Benefit
<S>
<C>
<C>
<C>
Charles C. 
Hanebuth
President and Chief 
Executive Officer
1A22856570
$2,040,000.
00
William J. 
Jessie
Vice President and Chief 
Financial Officer
1A22856560
$1,000,000.
00
Joseph E. 
Harrison
Vice President, Sales and 
Marketing
1A22856540
$860,000.00
William H. Gerak
Vice President, 
Administration
1A22856530
$830,000.00
</TABLE>