Document:

<PAGE>   1
                                                                   EXHIBIT 4-221

                                  EXECUTED IN              COUNTERPARTS
                                  OF WHICH THIS IS COUNTERPART NO.             .

                           THE DETROIT EDISON COMPANY
                              (2000 Second Avenue,
                            Detroit, Michigan 48226)

                                       TO
                             BANKERS TRUST COMPANY
                              (Four Albany Street,
                           New York, New York 10015)

                                                  AS TRUSTEE

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

                                   INDENTURE
                           Dated as of August 1, 1995

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

                   SUPPLEMENTAL TO MORTGAGE AND DEED OF TRUST
                          DATED AS OF OCTOBER 1, 1924

                                 PROVIDING FOR

                   (A) GENERAL AND REFUNDING MORTGAGE BONDS,
                           1995 SERIES AP, DUE SEPTEMBER 1, 2025

                   (B) GENERAL AND REFUNDING MORTGAGE BONDS,
                           1995 SERIES BP, DUE AUGUST 15, 2025

                                      AND

                         (C) RECORDING AND FILING DATA
<PAGE>   2
                                        i

                               TABLE OF CONTENTS*

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

<TABLE>
<CAPTION>
                                                                  PAGE
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<S>                                                             <C>
PARTIES.....................................................        1
RECITALS
  Original Indenture and Supplementals......................        1
  Issue of Bonds under Indenture............................        1
  Bonds heretofore issued...................................        1
  Reason for creation of new series.........................        5
  Bonds to be 1995 Series AP and 1995 Series BP.............        5
  Further Assurance.........................................        5
  Authorization of Supplemental Indenture...................        5
  Consideration for Supplemental Indenture..................        5

                                    PART I.
                      CREATION OF THREE HUNDRED EIGHTEENTH
                                SERIES OF BONDS
                     GENERAL AND REFUNDING MORTGAGE BONDS,
                                 1995 SERIES AP

Sec. 1. Certain terms of Bonds of 1995 Series AP............        6
Sec. 2. Redemption of Bonds of 1995 Series AP...............        8
Sec. 3. Redemption of Bonds of 1995 Series AP in event of
        acceleration of Strategic Fund Revenue Bonds........        8
Sec. 4. Form of Bonds of 1995 Series AP.....................        9
        Form of Trustee's Certificate.......................       14

                                    PART II.
                      CREATION OF THREE HUNDRED NINETEENTH
                                SERIES OF BONDS
                     GENERAL AND REFUNDING MORTGAGE BONDS,
                                 1995 SERIES BP

Sec. 1. Certain terms of Bonds of 1995 Series BP............       15
Sec. 2. Redemption of Bonds of 1995 Series BP...............       17
Sec. 3. Redemption of Bonds of 1995 Series BP in event of
        acceleration of Strategic Fund Revenue Bonds........       17
Sec. 4. Form of Bonds of 1995 Series BP.....................       18
        Form of Trustee's Certificate.......................       23

                                   PART III.
                           RECORDING AND FILING DATA

Recording and filing of Original Indenture..................       24
Recording and filing of Supplemental Indentures.............       24
Recording of Certificates of Provision for Payment..........       30

                                    PART IV.
                                  THE TRUSTEE

Terms and conditions of acceptance of trust by Trustee......       30

                                    PART V.
                                 MISCELLANEOUS

Confirmation of Section 318(c) of Trust Indenture Act.......       30
Execution in Counterparts...................................       30
Testimonium.................................................       31
Execution...................................................       31
Acknowledgement of execution by Company.....................       31
Acknowledgement of execution by Trustee.....................       32
Affidavit as to consideration and good faith................       33
</TABLE>

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* This Table of Contents shall not have any bearing upon the interpretation of
  any of the terms or provisions of this Indenture.
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                                        1

<TABLE>
<S>                      <C>
PARTIES.                 SUPPLEMENTAL INDENTURE, dated as of the first day of August,
                         in the year one thousand nine hundred and ninety-five,
                         between THE DETROIT EDISON COMPANY, a corporation organized
                         and existing under the laws of the State of Michigan and a
                         transmitting utility (hereinafter called the "Company"),
                         party of the first part, and BANKERS TRUST COMPANY, a
                         corporation organized and existing under the laws of the
                         State of New York, having its corporate trust office at Four
                         Albany Street, in the Borough of Manhattan, The City and
                         State of New York, as Trustee under the Mortgage and Deed of
                         Trust hereinafter mentioned (hereinafter called the "Trus-
                         tee"), party of the second part.

ORIGINAL                 WHEREAS, the Company has heretofore executed and delivered
INDENTURE AND            its Mortgage and Deed of Trust (hereinafter referred to as
SUPPLEMENTALS.           the "Original Indenture"), dated as of October 1, 1924, to
                         the Trustee, for the security of all bonds of the Company
                         outstanding thereunder, and pursuant to the terms and
                         provisions of the Original Indenture, indentures dated as
                         of, respectively, June 1, 1925, August 1, 1927, February 1,
                         1931, June 1, 1931, October 1, 1932, September 25, 1935,
                         September 1, 1936, November 1, 1936, February 1, 1940,
                         December 1, 1940, September 1, 1947, March 1, 1950, November
                         15, 1951, January 15, 1953, May 1, 1953, March 15, 1954, May
                         15, 1955, August 15, 1957, June 1, 1959, December 1, 1966,
                         October 1, 1968, December 1, 1969, July 1, 1970, December
                         15, 1970, June 15, 1971, November 15, 1971, January 15,
                         1973, May 1, 1974, October 1, 1974, January 15, 1975,
                         November 1, 1975, December 15, 1975, February 1, 1976, June
                         15, 1976, July 15, 1976, February 15, 1977, March 1, 1977,
                         June 15, 1977, July 1, 1977, October 1, 1977, June 1, 1978,
                         October 15, 1978, March 15, 1979, July 1, 1979, September 1,
                         1979, September 15, 1979, January 1, 1980, April 1, 1980,
                         August 15, 1980, August 1, 1981, November 1, 1981, June 30,
                         1982, August 15, 1982, June 1, 1983, October 1, 1984, May 1,
                         1985, May 15, 1985, October 15, 1985, April 1, 1986, August
                         15, 1986, November 30, 1986, January 31, 1987, April 1,
                         1987, August 15, 1987, November 30, 1987, June 15, 1989,
                         July 15, 1989, December 1, 1989, February 15, 1990, November
                         1, 1990, April 1, 1991, May 1, 1991, May 15, 1991, September
                         1, 1991, November 1, 1991, January 15, 1992, February 29,
                         1992, April 15, 1992, July 15, 1992, July 31, 1992, November
                         30, 1992, December 15, 1992, January 1, 1993, March 1, 1993,
                         March 15, 1993, April 1, 1993, April 26, 1993, May 31, 1993,
                         June 30, 1993, June 30, 1993, September 15, 1993, March 1,
                         1994, June 15, 1994, August 15, 1994 and December 1, 1994
                         supplemental to the Original Indenture, have heretofore been
                         entered into between the Company and the Trustee (the
                         Original Indenture and all indentures supplemental thereto
                         together being hereinafter sometimes referred to as the
                         "Indenture"); and

ISSUE OF                 WHEREAS, the Indenture provides that said bonds shall be
BONDS UNDER              issuable in one or more series, and makes provision that the
INDENTURE.               rates of interest and dates for the payment thereof, the
                         date of maturity or dates of maturity, if of serial
                         maturity, the terms and rates of optional redemption (if
                         redeemable), the forms of registered bonds without coupons
                         of any series and any other provisions and agreements in
                         respect thereof, in the Indenture provided and permitted, as
                         the Board of Directors may determine, may be expressed in a
                         supplemental indenture to be made by the Company to the
                         Trustee thereunder; and

BONDS HERETOFORE         WHEREAS, bonds in the principal amount of Eight billion
ISSUED.                  three hundred twenty- eight million five hundred
                         seventy-seven thousand dollars ($8,328,577,000) have hereto-
                         fore been issued under the indenture as follows, viz:
</TABLE>

<TABLE>
                        <C>        <S>                                <C>
                              (1)  Bonds of Series A                  -- Principal Amount $26,016,000,
                              (2)  Bonds of Series B                  -- Principal Amount $23,000,000,
                              (3)  Bonds of Series C                  -- Principal Amount $20,000,000,
                              (4)  Bonds of Series D                  -- Principal Amount $50,000,000,
                              (5)  Bonds of Series E                  -- Principal Amount $15,000,000,
                              (6)  Bonds of Series F                  -- Principal Amount $49,000,000,
                              (7)  Bonds of Series G                  -- Principal Amount $35,000,000,
                              (8)  Bonds of Series H                  -- Principal Amount $50,000,000,
                              (9)  Bonds of Series I                  -- Principal Amount $60,000,000,
                             (10)  Bonds of Series J                  -- Principal Amount $35,000,000,
                             (11)  Bonds of Series K                  -- Principal Amount $40,000,000,
                             (12)  Bonds of Series L                  -- Principal Amount $24,000,000,
                             (13)  Bonds of Series M                  -- Principal Amount $40,000,000,
                             (14)  Bonds of Series N                  -- Principal Amount $40,000,000,
</TABLE>
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                                        2
<TABLE>
                        <C>        <S>                                <C>
                             (15)  Bonds of Series O                  -- Principal Amount $60,000,000,
                             (16)  Bonds of Series P                  -- Principal Amount $70,000,000,
                             (17)  Bonds of Series Q                  -- Principal Amount $40,000,000,
                             (18)  Bonds of Series W                  -- Principal Amount $50,000,000,
                             (19)  Bonds of Series AA                 -- Principal Amount
                                                                      $100,000,000,
                             (20)  Bonds of Series BB                 -- Principal Amount $50,000,000,
                             (21)  Bonds of Series CC                 -- Principal Amount $50,000,000,
                             (22)  Bonds of Series UU                 -- Principal Amount
                                                                      $100,000,000,
                          (23-31)  Bonds of Series DDP Nos. 1-9       -- Principal Amount $14,305,000,
                          (32-45)  Bonds of Series FFR Nos. 1-14      -- Principal Amount $45,600,000,
                          (46-67)  Bonds of Series GGP Nos. 1-22      -- Principal Amount $42,300,000,
                             (68)  Bonds of Series HH                 -- Principal Amount $50,000,000,
                          (69-90)  Bonds of Series IIP Nos. 1-22      -- Principal Amount $3,750,000,
                          (91-98)  Bonds of Series JJP Nos. 1-8       -- Principal Amount $6,850,000,
                         (99-106)  Bonds of Series KKP Nos. 1-8       -- Principal Amount $14,890,000,
                        (107-121)  Bonds of Series LLP Nos. 1-15      -- Principal Amount $8,850,000,
                        (122-142)  Bonds of Series NNP Nos. 1-21      -- Principal Amount $47,950,000,
                        (143-160)  Bonds of Series OOP Nos. 1-18      -- Principal Amount $18,880,000,
                        (161-179)  Bonds of Series QQP Nos. 1-19      -- Principal Amount $13,650,000,
                        (180-194)  Bonds of Series TTP Nos. 1-15      -- Principal Amount $3,800,000,
                            (195)  Bonds of 1980 Series A             -- Principal Amount $50,000,000,
                        (196-220)  Bonds of 1980 Series CP Nos. 1-25  -- Principal Amount $35,000,000,
                        (221-231)  Bonds of 1980 Series DP Nos. 1-11  -- Principal Amount $10,750,000,
                        (232-247)  Bonds of 1981 Series AP Nos. 1-16  -- Principal Amount
                                                                      $124,000,000,
                            (248)  Bonds of 1985 Series A             -- Principal Amount $35,000,000,
                            (249)  Bonds of 1985 Series B             -- Principal Amount $50,000,000,
                            (250)  Bonds of Series PP                 -- Principal Amount $70,000,000,
                            (251)  Bonds of Series RR                 -- Principal Amount $70,000,000,
                            (252)  Bonds of Series EE                 -- Principal Amount $50,000,000,
                        (253-254)  Bonds of Series MMP and MMP No. 2  -- Principal Amount $5,430,000,
                            (255)  Bonds of Series T                  -- Principal Amount $75,000,000,
                            (256)  Bonds of Series U                  -- Principal Amount $75,000,000,
                            (257)  Bonds of 1986 Series B             -- Principal Amount
                                                                      $100,000,000,
                            (258)  Bonds of 1987 Series D             -- Principal Amount
                                                                      $250,000,000,
                            (259)  Bonds of 1987 Series E             -- Principal Amount
                                                                      $150,000,000,
                            (260)  Bonds of 1987 Series C             -- Principal Amount
                                                                      $225,000,000,
                            (261)  Bonds of Series V                  -- Principal Amount
                                                                      $100,000,000,
                            (262)  Bonds of Series SS                 -- Principal Amount
                                                                      $150,000,000,
                            (263)  Bonds of 1980 Series B             -- Principal Amount
                                                                      $100,000,000,
                            (264)  Bonds of 1986 Series C             -- Principal Amount
                                                                      $200,000,000,
                            (265)  Bonds of 1986 Series A             -- Principal Amount
                                                                      $200,000,000,
                            (266)  Bonds of 1987 Series B             -- Principal Amount
                                                                      $175,000,000,
                            (267)  Bonds of Series X                  -- Principal Amount
                                                                      $100,000,000,
                            (268)  Bonds of 1987 Series F             -- Principal Amount
                                                                      $200,000,000,
                            (269)  Bonds of 1987 Series A             -- Principal Amount
                                                                      $300,000,000,
                            (270)  Bonds of Series Y                  -- Principal Amount $60,000,000,
                            (271)  Bonds of Series Z                  -- Principal Amount
                                                                      $100,000,000,
                            (272)  Bonds of 1989 Series A             -- Principal Amount
                                                                      $300,000,000,
                            (273)  Bonds of 1984 Series AP            -- Principal Amount $2,400,000
                            (274)  Bonds of 1984 Series BP            -- Principal Amount $7,750,000
</TABLE>

<TABLE>
<S>                     <C>
                        all of which have either been retired and cancelled, or no
                        longer represent obligations of the Company, having been
                        called for redemption and funds necessary to effect the
                        payment, redemption and retirement thereof having been
                        deposited with the Trustee as a special trust fund to be
                        applied for such purpose;

                        (275) Bonds of Series R in the principal amount of One
                        hundred million dollars ($100,000,000), all of which are
                        outstanding at the date hereof;
</TABLE>
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                                        3
<TABLE>
<S>                     <C>
                        (276) Bonds of Series S in the principal amount of One
                        hundred fifty million dollars ($150,000,000), all of which
                        are outstanding at the date hereof;

                        (277-283) Bonds of Series KKP Nos. 9-15 in the principal
                        amount of One hundred ninety-nine million five hundred
                        ninety thousand dollars ($199,590,000), all of which are
                        outstanding at the date hereof;

                        (284) Bonds of 1989 Series BP in the principal amount of
                        Sixty-six million five hundred sixty-five thousand dollars
                        ($66,565,000), all of which are outstanding at the date
                        hereof;

                        (285) Bonds of 1990 Series A in the principal amount of One
                        hundred ninety-four million six hundred forty-nine thousand
                        dollars ($194,649,000) of which Thirty-seven million six
                        hundred seventy-four thousand dollars ($37,674,000)
                        principal amount have heretofore been retired and One
                        hundred fifty-six million nine hundred seventy-five thousand
                        dollars ($156,975,000) principal amount are outstanding at
                        the date hereof;

                        (286) Bonds of 1990 Series B in the principal amount of Two
                        hundred fifty-six million nine hundred thirty-two thousand
                        dollars ($256,932,000) of which Fifty-seven million
                        ninety-six thousand dollars ($57,096,000) principal amount
                        have heretofore been retired and One hundred ninety-nine
                        million eight hundred thirty-six thousand dollars
                        ($199,836,000) principal amount are outstanding at the date
                        hereof;

                        (287) Bonds of 1990 Series C in the principal amount of
                        Eighty-five million four hundred seventy-five thousand
                        dollars ($85,475,000) of which Twenty million five hundred
                        fourteen thousand dollars ($20,514,000) principal amount
                        have heretofore been retired and Sixty-four million nine
                        hundred sixty-one thousand dollars ($64,961,000) principal
                        amount are outstanding at the date hereof;

                        (288) Bonds of 1991 Series AP in the principal amount of
                        Thirty-two million three hundred seventy-five thousand
                        dollars ($32,375,000), all of which are outstanding at the
                        date hereof;

                        (289) Bonds of 1991 Series BP in the principal amount of
                        Twenty-five million nine hundred ten thousand dollars
                        ($25,910,000), all of which are outstanding at the date
                        hereof;

                        (290) Bonds of 1991 Series CP in the principal amount of
                        Thirty-two million eight hundred thousand dollars
                        ($32,800,000), all of which are outstanding at the date
                        hereof;

                        (291) Bonds of 1991 Series DP in the principal amount of
                        Thirty-seven million six hundred thousand dollars
                        ($37,600,000), all of which are outstanding at the date
                        hereof;

                        (292) Bonds of 1991 Series EP in the principal amount of
                        Forty-one million four hundred eighty thousand dollars
                        ($41,480,000), all of which are outstanding at the date
                        hereof;

                        (293) Bonds of 1991 Series FP in the principal amount of
                        Ninety-eight million three hundred seventy-five thousand
                        dollars ($98,375,000), all of which are outstanding at the
                        date hereof;

                        (294) Bonds of 1992 Series BP in the principal amount of
                        Twenty million nine hundred seventy-five thousand dollars
                        ($20,975,000), all of which are outstanding at the date
                        hereof;

                        (295) Bonds of 1992 Series AP in the principal amount of
                        Sixty-six million dollars ($66,000,000), all of which are
                        outstanding at the date hereof;

                        (296) Bonds of 1992 Series D in the principal amount of
                        Three hundred million dollars ($300,000,000), of which Ten
                        million dollars ($10,000,000) principal amount have
                        heretofore been retired and Two hundred ninety million
                        ($290,000,000) principal amount are outstanding at the date
                        hereof;

                        (297) Bonds of 1992 Series CP in the principal amount of
                        Thirty-five million dollars ($35,000,000), all of which are
                        outstanding at the date hereof;

                        (298) Bonds of 1992 Series E in the principal amount of
                        Fifty million dollars ($50,000,000), all of which are
                        outstanding at the date hereof;

                        (299) Bonds of 1989 Series BP No. 2 in the principal amount
                        of Thirty-six million dollars ($36,000,000), all of which
                        are outstanding at the date hereof;
</TABLE>
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<TABLE>
 <S><C>

                        (300) Bonds of 1993 Series C in the principal amount of Two
                        hundred twenty-five million dollars ($225,000,000), all of
                        which are outstanding at the date hereof;

                        (301) Bonds of 1993 Series B in the principal amount of
                        Fifty million dollars ($50,000,000), all of which are
                        outstanding at the date hereof;

                        (302) Bonds of 1993 Series E in the principal amount of Four
                        hundred million dollars ($400,000,000), of which Ten million
                        dollars ($10,000,000) principal amount have heretofore been
                        retired and Three hundred ninety million ($390,000,000)
                        principal amount are outstanding at the date hereof;
                        (303) Bonds of 1993 Series D in the principal amount of One
                        hundred million dollars ($100,000,000), all of which are
                        outstanding at the date hereof;
                        (304) Bonds of 1993 Series FP in the principal amount of
                        Five million six hundred eighty-five thousand dollars
                        ($5,685,000), all of which are outstanding at the date
                        hereof;
                        (305) Bonds of 1993 Series G in the principal amount of Two
                        hundred twenty-five million dollars ($225,000,000), all of
                        which are outstanding at the date hereof;
                        (306) Bonds of 1993 Series J in the principal amount of
                        Three hundred million dollars ($300,000,000), of which
                        Thirty million dollars ($30,000,000) principal amount have
                        heretofore been retired and Two hundred seventy million
                        ($270,000,000) principal amount are outstanding at the date
                        hereof;
                        (307) Bonds of 1993 Series IP in the principal amount of
                        Five million eight hundred twenty-five thousand dollars
                        ($5,825,000), all of which are outstanding at the date
                        hereof;
                        (308) Bonds of 1993 Series AP in the principal amount of
                        Sixty-five million dollars ($65,000,000), all of which are
                        outstanding at the date hereof;
                        (309) Bonds of 1993 Series H in the principal amount of
                        Fifty million dollars ($50,000,000), all of which are
                        outstanding at the date hereof;
                        (310) Bonds of 1993 Series K in the principal amount of One
                        hundred sixty million dollars ($160,000,000), all of which
                        are outstanding at the date hereof;
                        (311) Bonds of 1994 Series AP in the principal amount of
                        Seven million five hundred thirty-five thousand dollars
                        ($7,535,000), all of which are outstanding at the date
                        hereof;
                        (312) Bonds of 1994 Series BP in the principal amount of
                        Twelve million nine hundred thirty-five thousand dollars
                        ($12,935,000), all of which are outstanding at the date
                        hereof;
                        (313) Bonds of 1994 Series C in the principal amount of Two
                        hundred million dollars ($200,000,000), all of which are
                        outstanding at the date hereof;
                        (314) Bonds of 1994 Series DP in the principal amount of
                        Twenty-three million seven hundred thousand dollars
                        ($23,700,000), all of which are outstanding at the date
                        hereof;
                        and, accordingly, of the bonds so issued, Three billion four
                        hundred ninety-five million one hundred twenty-two thousand
                        dollars ($3,495,122,000) principal amount are outstanding at
                        the date hereof; and
</TABLE>

<TABLE>
<S>                      <C>
REASON FOR                 WHEREAS, the Michigan Strategic Fund has agreed to issue
CREATION OF              and sell $97,000,000 principal amount of its Limited
NEW SERIES.              Obligation Refunding Revenue Bonds (The Detroit Edison
                         Company Pollution Control Bonds Project), Collateralized
                         Series 1995AA, in order to provide funds for the refunding
                         of certain pollution control related bonds previously issued
                         to finance pollution control projects of the Company; and
                           WHEREAS, the Company will enter into a Loan Agreement,
                         dated as of September 1, 1995, with the Michigan Strategic
                         Fund in connection with the issuance of the Collateralized
                         Series 1995AA Bonds in order to refund certain pollution
                         control related bonds, and pursuant to such Loan Agreement
                         the Company has agreed to issue its General and Refunding
                         Mortgage Bonds under the Indenture in order further to
                         secure its obligations under such Loan Agreement; and
                           WHEREAS, the Michigan Strategic Fund has agreed to issue
                         and sell $22,175,000 principal amount of its Limited
                         Obligation Refunding Revenue Bonds (The Detroit Edison
                         Company Pollution Control Bonds Project), Collateralized
                         Series 1995BB, in order to provide funds for the refunding
                         of certain pollution control related bonds previously issued
                         to finance pollution control projects of the Company; and
</TABLE>
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                                        5
<TABLE>
<S>                      <C>
                           WHEREAS, the Company will enter into a Loan Agreement,
                         dated as of August 1, 1995, with the Michigan Strategic Fund
                         in connection with the issuance of the Collateralized Series
                         1995BB Bonds in order to refund certain pollution control
                         related bonds, and pursuant to such Loan Agreement the
                         Company has agreed to issue its General and Refunding
                         Mortgage Bonds under the Indenture in order further to
                         secure its obligations under such Loan Agreement; and
                           WHEREAS, for such purposes the Company desires to issue
                         new series of bonds to be issued under the Indenture and to
                         be authenticated and delivered pursuant to Section 8 of
                         Article III of the Indenture; and
BONDS TO BE                WHEREAS, the Company desires by this Supplemental
1995 SERIES AP AND       Indenture to create new series of bonds, to be designated
1995 SERIES BP.          "General and Refunding Mortgage Bonds, 1995 Series AP" and
                         "General and Refunding Mortgage Bonds, 1995 Series BP"; and
FURTHER                    WHEREAS, the Original Indenture, by its terms, includes in
ASSURANCE.               the property subject to the lien thereof all of the estates
                         and properties, real, personal and mixed, rights, privileges
                         and franchises of every nature and kind and wheresoever
                         situate, then or thereafter owned or possessed by or
                         belonging to the Company or to which it was then or at any
                         time thereafter might be entitled in law or in equity
                         (saving and excepting, however, the property therein
                         specifically excepted or released from the lien thereof),
                         and the Company therein covenanted that it would, upon
                         reasonable request, execute and deliver such further
                         instruments as may be necessary or proper for the better
                         assuring and confirming unto the Trustee all or any part of
                         the trust estate, whether then or thereafter owned or
                         acquired by the Company (saving and excepting, however,
                         property specifically excepted or released from the lien
                         thereof); and
AUTHORIZATION              WHEREAS, the Company in the exercise of the powers and
OF SUPPLEMENTAL          authority conferred upon and reserved to it under and by
INDENTURE.               virtue of the provisions of the Indenture, and pursuant to
                         resolutions of its Board of Directors has duly resolved and
                         determined to make, execute and deliver to the Trustee a
                         supplemental indenture in the form hereof for the purposes
                         herein provided; and
                           WHEREAS, all conditions and requirements necessary to make
                         this Supplemental Indenture a valid and legally binding
                         instrument in accordance with its terms have been done,
                         performed and fulfilled, and the execution and delivery
                         hereof have been in all respects duly authorized;
CONSIDERATION              NOW, THEREFORE, THIS INDENTURE WITNESSETH: That The
FOR SUPPLEMENTAL         Detroit Edison Company, in consideration of the premises and
INDENTURE.               of the covenants contained in the Indenture and of the sum
                         of One Dollar ($1.00) and other good and valuable
                         consideration to it duly paid by the Trustee at or before
                         the ensealing and delivery of these presents, the receipt
                         whereof is hereby acknowledged, hereby covenants and agrees
                         to and with the Trustee and its successors in the trusts
                         under the Original Indenture and in said indentures
                         supplemental thereto as follows:
</TABLE>
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                                        6

<TABLE>
<S>                      <C>
                                                   PART I.
                                     CREATION OF THREE HUNDRED EIGHTEENTH
                                               SERIES OF BONDS.
                                    GENERAL AND REFUNDING MORTGAGE BONDS,
                                                1995 SERIES AP

CERTAIN TERMS              SECTION 1. The Company hereby creates the Three hundred
OF BONDS OF              eighteenth series of bonds to be issued under and secured by
1995 SERIES AP.          the Original Indenture as amended to date and as further
                         amended by this Supplemental Indenture, to be designated,
                         and to be distinguished from the bonds of all other series,
                         by the title "General and Refunding Mortgage Bonds, 1995
                         Series AP" (elsewhere herein referred to as the "bonds of
                         1995 Series AP"). The aggregate principal amount of bonds of
                         1995 Series AP shall be limited to Ninety-seven million
                         dollars ($97,000,000), except as provided in Sections 7 and
                         13 of Article II of the Original Indenture with respect to
                         exchanges and replacements of bonds.

                           Each bond of 1995 Series AP is to be irrevocably assigned
                         to, and registered in the name of, NBD Bank, as trustee, or
                         a successor trustee (said trustee or any successor trustee
                         being hereinafter referred to as the "Strategic Fund Trust
                         Indenture Trustee"), under the Trust Indenture, dated as of
                         September 1, 1995 (hereinafter called the "Strategic Fund
                         Trust Indenture"), between the Michigan Strategic Fund
                         (hereinafter called "Strategic Fund"), and the Strategic
                         Fund Trust Indenture Trustee, to secure payment of the
                         Michigan Strategic Fund Limited Obligation Refunding Revenue
                         Bonds (The Detroit Edison Company Pollution Control Bonds
                         Project), Collateralized Series 1995AA (hereinafter called
                         the "Strategic Fund Revenue Bonds"), issued by the Strategic
                         Fund under the Strategic Fund Trust Indenture, the proceeds
                         of which have been provided for the refunding of certain
                         pollution control related bonds which the Company has agreed
                         to refund pursuant to the provisions of the Loan Agreement,
                         dated as of September 1, 1995 (hereinafter called the
                         "Strategic Fund Agreement"), between the Company and the
                         Strategic Fund.

                           The bonds of 1995 Series AP shall be issued as registered
                         bonds without coupons in denominations of a multiple of
                         $5,000. The bonds of 1995 Series AP shall be issued in the
                         aggregate principal amount of $97,000,000, shall mature on
                         September 1, 2025 and shall bear interest, payable
                         semi-annually on March 1 and September 1 of each year
                         (commencing March 1, 1996), at the rate of 6.40%, until the
                         principal thereof shall have become due and payable and
                         thereafter until the Company's obligation with respect to
                         the payment of said principal shall have been discharged as
                         provided in the Indenture.

                           The bonds of 1995 Series AP shall be payable as to
                         principal, premium, if any, and interest as provided in the
                         Indenture, but only to the extent and in the manner herein
                         provided. The bonds of 1995 Series AP shall be payable, both
                         as to principal and interest, at the office or agency of the
                         Company in the Borough of Manhattan, The City and State of
                         New York, in any coin or currency of the United States of
                         America which at the time of payment is legal tender for
                         public and private debts.

                           Except as provided herein, each bond of 1995 Series AP
                         shall be dated the date of its authentication and interest
                         shall be payable on the principal represented thereby from
                         the March 1 or September 1 next preceding the date thereof
                         to which interest has been paid on bonds of 1995 Series AP,
                         unless the bond is authenticated on a date to which interest
                         has been paid, in which case interest shall be payable from
                         the date of authentication, or unless the date of
                         authentication is prior to March 1, 1996, in which case
                         interest shall be payable from September 1, 1995.
</TABLE>
<PAGE>   9
                                        7
<TABLE>
<S>                      <C>
                           The bonds of 1995 Series AP in definitive form shall be,
                         at the election of the Company, fully engraved or shall be
                         lithographed or printed in authorized denominations as
                         aforesaid and numbered 1 and upwards (with such further
                         designation as may be appropriate and desirable to indicate
                         by such designation the form, series and denominations of
                         bonds of 1995 Series AP). Until bonds of 1995 Series AP in
                         definitive form are ready for delivery, the Company may
                         execute, and upon its request in writing the Trustee shall
                         authenticate and deliver in lieu thereof, bonds of 1995
                         Series AP in temporary form, as provided in Section 10 of
                         Article II of the Indenture. Temporary bonds of 1995 Series
                         AP, if any, may be printed and may be issued in authorized
                         denominations in substantially the form of definitive bonds
                         of 1995 Series AP, but with such omissions, insertions and
                         variations as may be appropriate for temporary bonds, all as
                         may be determined by the Company.

                           Bonds of 1995 Series AP shall not be assignable or
                         transferable except as may be required to effect a transfer
                         to any successor trustee under the Strategic Fund Trust
                         Indenture, or, subject to compliance with applicable law, as
                         may be involved in the course of the exercise of rights and
                         remedies consequent upon an Event of Default under the
                         Strategic Fund Trust Indenture. Any such transfer shall be
                         made upon surrender thereof for cancellation at the office
                         or agency of the Company in the Borough of Manhattan, The
                         City and State of New York, together with a written
                         instrument of transfer (if so required by the Company or by
                         the Trustee) in form approved by the Company duly executed
                         by the holder or by its duly authorized attorney. Bonds of
                         1995 Series AP shall in the same manner be exchangeable for
                         a like aggregate principal amount of bonds of 1995 Series AP
                         upon the terms and conditions specified herein and in
                         Section 7 of Article II of the Indenture. The Company waives
                         its rights under Section 7 of Article II of the Indenture
                         not to make exchanges or transfers of bonds of 1995 Series
                         AP, during any period of ten days next preceding any
                         redemption date for such bonds.

                           Bonds of 1995 Series AP, in definitive and temporary form,
                         may bear such legends as may be necessary to comply with any
                         law or with any rules or regulations made pursuant thereto
                         or as may be specified in the Strategic Fund Agreement.

                           Upon payment of the principal or premium, if any, or
                         interest on the Strategic Fund Revenue Bonds, whether at
                         maturity or prior to maturity by redemption or otherwise, or
                         upon provision for the payment thereof having been made in
                         accordance with Articles I or IV of the Strategic Fund Trust
                         Indenture, bonds of 1995 Series AP in a principal amount
                         equal to the principal amount of the Strategic Fund Revenue
                         Bonds, shall, to the extent of such payment of principal,
                         premium or interest, be deemed fully paid and the obligation
                         of the Company thereunder to make such payment shall
                         forthwith cease and be discharged, and, in the case of the
                         payment of principal and premium, if any, such bonds shall
                         be surrendered for cancellation or presented for appropriate
                         notation to the Trustee.
</TABLE>
<PAGE>   10
                                        8
<TABLE>
<S>                      <C>
REDEMPTION                 SECTION 2. Bonds of 1995 Series AP shall be redeemed on
OF BONDS OF              the date and in the respective principal amount which
1995 SERIES AP.          correspond to the redemption date for, and the principal
                         amount to be redeemed of, the Strategic Fund Revenue Bonds.
                         In the event the Company elects to redeem any Strategic Fund
                         Revenue Bonds prior to maturity in accordance with the
                         provisions of the Strategic Fund Trust Indenture, the
                         Company shall on the same date redeem bonds of 1995 Series
                         AP in the principal amount and at the redemption price
                         corresponding to the Strategic Fund Revenue Bonds so
                         redeemed. The Company agrees to give the Trustee notice of
                         any such redemption of bonds of 1995 Series AP on the same
                         date as it gives notice of redemption of Strategic Fund
                         Revenue Bonds to the Strategic Fund Trust Indenture Trustee.

REDEMPTION                 SECTION 3. In the event of an Event of Default under the
OF BONDS OF 1995 SERIES  Strategic Fund Trust Indenture and the acceleration of all
AP IN EVENT OF           Strategic Fund Revenue Bonds, the bonds of 1995 Series AP
ACCELERATION             shall be redeemable in whole upon receipt by the Trustee of
OF STRATEGIC FUND        a written demand (hereinafter called a "Redemption Demand")
REVENUE BONDS.           from the Strategic Fund Trust Indenture Trustee stating that
                         there has occurred under the Strategic Fund Trust Indenture
                         both an Event of Default and a declaration of acceleration
                         of payment of principal, accrued interest and premium, if
                         any, on the Strategic Fund Revenue Bonds, specifying the
                         last date to which interest on the Strategic Fund Revenue
                         Bonds has been paid (such date being hereinafter referred to
                         as the "Initial Interest Accrual Date") and demanding
                         redemption of the bonds of said series. The Trustee shall,
                         within five days after receiving such Redemption Demand,
                         mail a copy thereof to the Company marked to indicate the
                         date of its receipt by the Trustee. Promptly upon receipt by
                         the Company of such copy of a Redemption Demand, the Company
                         shall fix a date on which it will redeem the bonds of said
                         series so demanded to be redeemed (hereinafter called the
                         "Demand Redemption Date"). Notice of the date fixed as the
                         Demand Redemption Date shall be mailed by the Company to the
                         Trustee at least ten days prior to such Demand Redemption
                         Date. The date to be fixed by the Company as and for the
                         Demand Redemption Date may be any date up to and including
                         the earlier of (x) the 60th day after receipt by the Trustee
                         of the Redemption Demand or (y) the maturity date of such
                         bonds first occurring following the 20th day after the
                         receipt by the Trustee of the Redemption Demand; provided,
                         however, that if the Trustee shall not have received such
                         notice fixing the Demand Redemption Date on or before the
                         10th day preceding the earlier of such dates, the Demand
                         Redemption Date shall be deemed to be the earlier of such
                         dates. The Trustee shall mail notice of the Demand
                         Redemption Date (such notice being hereinafter called the
                         "Demand Redemption Notice") to the Strategic Fund Trust
                         Indenture Trustee not more than ten nor less than five days
                         prior to the Demand Redemption Date.
</TABLE>
<PAGE>   11
                                        9
<TABLE>
<S>                      <C>
                           Each bond of 1995 Series AP shall be redeemed by the
                         Company on the Demand Redemption Date therefore upon
                         surrender thereof by the Strategic Fund Trust Indenture
                         Trustee to the Trustee at a redemption price equal to the
                         principal amount thereof plus accrued interest thereon at
                         the rate specified for such bond from the Initial Interest
                         Accrual Date to the Demand Redemption Date plus an amount
                         equal to the aggregate premium, if any, due and payable on
                         such Demand Redemption Date on all Strategic Fund Revenue
                         Bonds; provided, however, that in the event of a receipt by
                         the Trustee of a notice that, pursuant to Section 604 of the
                         Strategic Fund Trust Indenture, the Strategic Fund Trust
                         Indenture Trustee has terminated proceedings to enforce any
                         right under the Strategic Fund Trust Indenture, then any
                         Redemption Demand shall thereby be rescinded by the
                         Strategic Fund Trust Indenture Trustee, and no Demand
                         Redemption Notice shall be given, or, if already given,
                         shall be automatically annulled; but no such rescission or
                         annulment shall extend to or affect any subsequent default
                         or impair any right consequent thereon.

                           Anything herein contained to the contrary notwithstanding,
                         the Trustee is not authorized to take any action pursuant to
                         a Redemption Demand and such Redemption Demand shall be of
                         no force or effect, unless it is executed in the name of the
                         Strategic Fund Trust Indenture Trustee by its President or
                         one of its Vice Presidents.

FORM OF BONDS              SECTION 4. The bonds of 1995 Series AP and the form of
OF 1995 SERIES AP.       Trustee's Certificate to be endorsed on such bonds shall be
                         substantially in the following forms, respectively:
</TABLE>
<PAGE>   12
                                        10

<TABLE>
<S>                      <C>
                                            [FORM OF FACE OF BOND]

                                          THE DETROIT EDISON COMPANY
                                     General and Refunding Mortgage Bond
                                 1995 Series AP, 6.40% due September 1, 2025

                           Notwithstanding any provisions hereof or in the Indenture,
                         this bond is not assignable or transferable except as may be
                         required to effect a transfer to any successor trustee under
                         the Trust Indenture, dated as of September 1, 1995 between
                         the Michigan Strategic Fund and NBD Bank, as trustee, or,
                         subject to compliance with applicable law, as may be
                         involved in the course of the exercise of rights and
                         remedies consequent upon an Event of Default under said
                         Trust Indenture.

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

                           THE DETROIT EDISON COMPANY (hereinafter called the
                         "Company"), a corporation of the State of Michigan, for
                         value received, hereby promises to pay to the Michigan
                         Strategic Fund, or registered assigns, at the Company's
                         office or agency in the Borough of Manhattan, The City and
                         State of New York, the principal sum of
                         dollars ($          ) in lawful money of the United States
                         of America on the date specified in the title hereof and
                         interest thereon at the rate specified in the title hereof,
                         in like lawful money, from September 1, 1995, and after the
                         first payment of interest on bonds of this Series has been
                         made or otherwise provided for, from the most recent date to
                         which interest has been paid or otherwise provided for,
                         semi-annually on March 1 and September 1 of each year
                         (commencing March 1, 1996), until the Company's obligation
                         with respect to payment of said principal shall have been
                         discharged, all as provided, to the extent and in the manner
                         specified in the Indenture hereinafter mentioned on the
                         reverse hereof and in the supplemental indenture pursuant to
                         which this bond has been issued.

                           Under a Trust Indenture, dated as of September 1, 1995
                         (hereinafter called the "Strategic Fund Trust Indenture"),
                         between the Michigan Strategic Fund (hereinafter called
                         "Strategic Fund"), and NBD Bank, as trustee (hereinafter
                         called the "Strategic Fund Trust Indenture Trustee"), the
                         Strategic Fund has issued Limited Obligation Refunding
                         Revenue Bonds (The Detroit Edison Company Pollution Control
                         Bonds Project), Collateralized Series 1995AA (hereinafter
                         called the "Strategic Fund Revenue Bonds"). This bond was
                         originally issued to the Strategic Fund and simultaneously
                         irrevocably assigned to the Strategic Fund Trust Indenture
                         Trustee so as to secure the payment of the Strategic Fund
                         Revenue Bonds. Payments of principal of, or premium, if any,
                         or interest on, Strategic Fund Revenue Bonds shall
                         constitute like payments on this bond as further provided
                         herein and in the supplemental indenture pursuant to which
                         this bond has been issued.

                           Reference is hereby made to such further provisions of
                         this bond set forth on the reverse hereof and such further
                         provisions shall for all purposes have the same effect as
                         though set forth at this place.

                           This bond shall not be valid or become obligatory for any
                         purpose until Bankers Trust Company, the Trustee under the
                         Indenture hereinafter mentioned on the reverse hereof, or
                         its successor thereunder, shall have signed the form of
                         certificate endorsed hereon.
</TABLE>
<PAGE>   13
                                        11
<TABLE>
<S>                      <C>
                           IN WITNESS WHEREOF, THE DETROIT EDISON COMPANY has caused
                         this instrument to be executed by its Chairman of the Board
                         and its Vice President and Treasurer, with their manual or
                         facsimile signatures, and its corporate seal, or a facsimile
                         thereof, to be impressed or imprinted hereon and the same to
                         be attested by its Corporate Secretary or an Assistant
                         Corporate Secretary with his or her manual or facsimile
                         signature.
</TABLE>

<TABLE>
<S>                      <C>                                        <C>
                         Dated:                                     THE DETROIT EDISON COMPANY
                                                                    By ............................
                                                                    Chairman of the Board
                                                                    ............................
                                                                        Vice President
                         Attest:                                        and Treasurer
                         ............................
                         Vice President and
                         Corporate Secretary
</TABLE>
<PAGE>   14
                                        12

<TABLE>
<S>                      <C>
                                           [FORM OF REVERSE OF BOND]

                           This bond is one of an authorized issue of bonds of the
                         Company, unlimited as to amount except as provided in the
                         Indenture hereinafter mentioned or any indentures
                         supplemental thereto, and is one of a series of General and
                         Refunding Mortgage Bonds known as 1995 Series AP, limited to
                         an aggregate principal amount of $97,000,000, except as
                         otherwise provided in the Indenture hereinafter mentioned.
                         This bond and all other bonds of said series are issued and
                         to be issued under, and are all equally and ratably secured
                         (except insofar as any sinking, amortization, improvement or
                         analogous fund, established in accordance with the
                         provisions of the Indenture hereinafter mentioned, may
                         afford additional security for the bonds of any particular
                         series and except as provided in Section 3 of Article VI of
                         said Indenture) by an Indenture, dated as of October 1,
                         1924, duly executed by the Company to Bankers Trust Company,
                         a corporation of the State of New York, as Trustee, to which
                         Indenture and all indentures supplemental thereto (including
                         the Supplemental Indenture dated as of August 1, 1995)
                         reference is hereby made for a description of the properties
                         and franchises mortgaged and conveyed, the nature and extent
                         of the security, the terms and conditions upon which the
                         bonds are issued and under which additional bonds may be
                         issued, and the rights of the holders of the bonds and of
                         the Trustee in respect of such security (which Indenture and
                         all indentures supplemental thereto, including the
                         Supplemental Indenture dated as of August 1, 1995, are
                         hereinafter collectively called the "Indenture"). As
                         provided in the Indenture, said bonds may be for various
                         principal sums and are issuable in series, which may mature
                         at different times, may bear interest at different rates and
                         may otherwise vary as in said Indenture provided. With the
                         consent of the Company and to the extent permitted by and as
                         provided in the Indenture, the rights and obligations of the
                         Company and of the holders of the bonds and the terms and
                         provisions of the Indenture, or of any indenture
                         supplemental thereto, may be modified or altered in certain
                         respects by affirmative vote of at least eighty-five percent
                         (85%) in amount of the bonds then outstanding, and, if the
                         rights of one or more, but less than all, series of bonds
                         then outstanding are to be affected by the action proposed
                         to be taken, then also by affirmative vote of at least
                         eighty-five percent (85%) in amount of the series of bonds
                         so to be affected (excluding in every instance bonds
                         disqualified from voting by reason of the Company's interest
                         therein as specified in the Indenture); provided, however,
                         that, without the consent of the holder hereof, no such
                         modification or alteration shall, among other things, affect
                         the terms of payment of the principal of or the interest on
                         this bond, which in those respects is unconditional.

                           This bond is redeemable upon the terms and conditions set
                         forth in the Indenture, including provision for redemption
                         upon demand of the Strategic Fund Trust Indenture Trustee
                         following the occurrence of an Event of Default under the
                         Strategic Fund Trust Indenture and the acceleration of the
                         principal of the Strategic Fund Revenue Bonds.

                           Under the Indenture, funds may be deposited with the
                         Trustee (which shall have become available for payment), in
                         advance of the redemption date of any of the bonds of 1995
                         Series AP (or portions thereof), in trust for the redemption
                         of such bonds (or portions thereof) and the interest due or
                         to become due thereon, and thereupon all obligations of the
                         Company in respect of such bonds (or portions thereof) so to
                         be redeemed and such interest shall cease and be discharged,
                         and the holders thereof shall thereafter be restricted
                         exclusively to such funds for any and all claims of
                         whatsoever nature on their part under the Indenture or with
                         respect to such bonds (or portions thereof) and interest.

                           In case an event of default, as defined in the Indenture,
                         shall occur, the principal of all the bonds issued
                         thereunder may become or be declared due and payable, in the
                         manner, with the effect and subject to the conditions
                         provided in the Indenture.
</TABLE>
<PAGE>   15
                                        13
<TABLE>
<S>                      <C>
                           Upon payment of the principal of, or premium, if any, or
                         interest on, the Strategic Fund Revenue Bonds, whether at
                         maturity or prior to maturity by redemption or otherwise or
                         upon provision for the payment thereof having been made in
                         accordance with Articles I or IV of the Strategic Fund Trust
                         Indenture, bonds of 1995 Series AP in a principal amount
                         equal to the principal amount of such Strategic Fund Revenue
                         Bonds and having both a corresponding maturity date and
                         interest rate shall, to the extent of such payment of
                         principal, premium or interest, be deemed fully paid and the
                         obligation of the Company thereunder to make such payment
                         shall forthwith cease and be discharged, and, in the case of
                         the payment of principal and premium, if any, such bonds of
                         said series shall be surrendered for cancellation or
                         presented for appropriate notation to the Trustee.

                           This bond is not assignable or transferable except as may
                         be required to effect a transfer to any successor trustee
                         under the Strategic Fund Trust Indenture, or, subject to
                         compliance with applicable law, as may be involved in the
                         course of the exercise of rights and remedies consequent
                         upon an Event of Default under the Strategic Fund Trust
                         Indenture. Any such transfer shall be made by the registered
                         holder hereof, in person or by his attorney duly authorized
                         in writing, on the books of the Company kept at its office
                         or agency in the Borough of Manhattan, The City and State of
                         New York, upon surrender and cancellation of this bond, and
                         thereupon, a new registered bond of the same series of
                         authorized denominations for a like aggregate principal
                         amount will be issued to the transferee in exchange
                         therefor, and this bond with others in like form may in like
                         manner be exchanged for one or more new bonds of the same
                         series of other authorized denominations, but of the same
                         aggregate principal amount, all as provided and upon the
                         terms and conditions set forth in the Indenture, and upon
                         payment, in any event, of the charges prescribed in the
                         Indenture.

                           No recourse shall be had for the payment of the principal
                         of or the interest on this bond, or for any claim based
                         hereon or otherwise in respect hereof or of the Indenture,
                         or of any indenture supplemental thereto, against any
                         incorporator, or against any past, present or future
                         stockholder, director or officer, as such, of the Company,
                         or of any predecessor or successor corporation, either
                         directly or through the Company or any such predecessor or
                         successor corporation, whether for amounts unpaid on stock
                         subscriptions or by virtue of any constitution, statute or
                         rule of law, or by the enforcement of any assessment or
                         penalty or otherwise howsoever; all such liability being, by
                         the acceptance hereof and as part of the consideration for
                         the issue hereof, expressly waived and released by every
                         holder or owner hereof, as more fully provided in the
                         Indenture.
</TABLE>
<PAGE>   16
                                        14
<TABLE>
<S>                      <C>
                           [FORM OF TRUSTEE'S CERTIFICATE]

FORM OF                    This bond is one of the bonds, of the series designated
TRUSTEE'S                therein, described in the within-mentioned Indenture.
CERTIFICATE.
</TABLE>

                                              BANKERS TRUST COMPANY,

                                                              as Trustee

                                              By ...........................
                                                Authorized Officer
<PAGE>   17
                                        15

<TABLE>
<S>                      <C>
                                                   PART II.
                                     CREATION OF THREE HUNDRED NINETEENTH
                                               SERIES OF BONDS.
                                    GENERAL AND REFUNDING MORTGAGE BONDS,
                                                1995 SERIES BP

CERTAIN TERMS              SECTION 1. The Company hereby creates the Three hundred
OF BONDS OF              nineteenth series of bonds to be issued under and secured by
1995 SERIES BP.          the Original Indenture as amended to date and as further
                         amended by this Supplemental Indenture, to be designated,
                         and to be distinguished from the bonds of all other series,
                         by the title "General and Refunding Mortgage Bonds, 1995
                         Series BP" (elsewhere herein referred to as the "bonds of
                         1995 Series BP"). The aggregate principal amount of bonds of
                         1995 Series BP shall be limited to Twenty-two million one
                         hundred seventy-five thousand dollars ($22,175,000), except
                         as provided in Sections 7 and 13 of Article II of the
                         Original Indenture with respect to exchanges and
                         replacements of bonds.

                           Each bond of 1995 Series BP is to be irrevocably assigned
                         to, and registered in the name of, Comerica Bank, as
                         trustee, or a successor trustee (said trustee or any
                         successor trustee being hereinafter referred to as the
                         "Strategic Fund Trust Indenture Trustee"), under the Trust
                         Indenture, dated as of August 1, 1995 (hereinafter called
                         the "Strategic Fund Trust Indenture"), between the Michigan
                         Strategic Fund (hereinafter called "Strategic Fund"), and
                         the Strategic Fund Trust Indenture Trustee, to secure
                         payment of the Michigan Strategic Fund Limited Obligation
                         Refunding Revenue Bonds (The Detroit Edison Company
                         Pollution Control Bonds Project), Collateralized Series
                         1995BB (hereinafter called the "Strategic Fund Revenue
                         Bonds"), issued by the Strategic Fund under the Strategic
                         Fund Trust Indenture, the proceeds of which have been
                         provided for the refunding of certain pollution control
                         related bonds which the Company has agreed to refund
                         pursuant to the provisions of the Loan Agreement, dated as
                         of August 1, 1995 (hereinafter called the "Strategic Fund
                         Agreement"), between the Company and the Strategic Fund.

                           The bonds of 1995 Series BP shall be issued as registered
                         bonds without coupons in denominations of a multiple of
                         $5,000. The bonds of 1995 Series BP shall be issued in the
                         aggregate principal amount of $22,175,000, shall mature on
                         August 15, 2025 and shall bear interest, payable
                         semi-annually on February 15 and August 15 of each year
                         (commencing February 15, 1996), at the rate of 6.20%, until
                         the principal thereof shall have become due and payable and
                         thereafter until the Company's obligation with respect to
                         the payment of said principal shall have been discharged as
                         provided in the Indenture.

                           The bonds of 1995 Series BP shall be payable as to
                         principal, premium, if any, and interest as provided in the
                         Indenture, but only to the extent and in the manner herein
                         provided. The bonds of 1995 Series BP shall be payable, both
                         as to principal and interest, at the office or agency of the
                         Company in the Borough of Manhattan, The City and State of
                         New York, in any coin or currency of the United States of
                         America which at the time of payment is legal tender for
                         public and private debts.

                           Except as provided herein, each bond of 1995 Series BP
                         shall be dated the date of its authentication and interest
                         shall be payable on the principal represented thereby from
                         the February 15 or August 15 next preceding the date thereof
                         to which interest has been paid on bonds of 1995 Series BP,
                         unless the bond is authenticated on a date to which interest
                         has been paid, in which case interest shall be payable from
                         the date of authentication, or unless the date of
                         authentication is prior to February 15, 1996, in which case
                         interest shall be payable from August 1, 1995.
</TABLE>
<PAGE>   18
                                        16
<TABLE>
<S>                      <C>
                           The bonds of 1995 Series BP in definitive form shall be,
                         at the election of the Company, fully engraved or shall be
                         lithographed or printed in authorized denominations as
                         aforesaid and numbered 1 and upwards (with such further
                         designation as may be appropriate and desirable to indicate
                         by such designation the form, series and denominations of
                         bonds of 1995 Series BP). Until bonds of 1995 Series BP in
                         definitive form are ready for delivery, the Company may
                         execute, and upon its request in writing the Trustee shall
                         authenticate and deliver in lieu thereof, bonds of 1995
                         Series BP in temporary form, as provided in Section 10 of
                         Article II of the Indenture. Temporary bonds of 1995 Series
                         BP, if any, may be printed and may be issued in authorized
                         denominations in substantially the form of definitive bonds
                         of 1995 Series BP, but with such omissions, insertions and
                         variations as may be appropriate for temporary bonds, all as
                         may be determined by the Company.

                           Bonds of 1995 Series BP shall not be assignable or
                         transferable except as may be required to effect a transfer
                         to any successor trustee under the Strategic Fund Trust
                         Indenture, or, subject to compliance with applicable law, as
                         may be involved in the course of the exercise of rights and
                         remedies consequent upon an Event of Default under the
                         Strategic Fund Trust Indenture. Any such transfer shall be
                         made upon surrender thereof for cancellation at the office
                         or agency of the Company in the Borough of Manhattan, The
                         City and State of New York, together with a written
                         instrument of transfer (if so required by the Company or by
                         the Trustee) in form approved by the Company duly executed
                         by the holder or by its duly authorized attorney. Bonds of
                         1995 Series BP shall in the same manner be exchangeable for
                         a like aggregate principal amount of bonds of 1995 Series BP
                         upon the terms and conditions specified herein and in
                         Section 7 of Article II of the Indenture. The Company waives
                         its rights under Section 7 of Article II of the Indenture
                         not to make exchanges or transfers of bonds of 1995 Series
                         BP, during any period of ten days next preceding any
                         redemption date for such bonds.

                           Bonds of 1995 Series BP, in definitive and temporary form,
                         may bear such legends as may be necessary to comply with any
                         law or with any rules or regulations made pursuant thereto
                         or as may be specified in the Strategic Fund Agreement.

                           Upon payment of the principal or premium, if any, or
                         interest on the Strategic Fund Revenue Bonds, whether at
                         maturity or prior to maturity by redemption or otherwise, or
                         upon provision for the payment thereof having been made in
                         accordance with Articles I or IV of the Strategic Fund Trust
                         Indenture, bonds of 1995 Series BP in a principal amount
                         equal to the principal amount of the Strategic Fund Revenue
                         Bonds, shall, to the extent of such payment of principal,
                         premium or interest, be deemed fully paid and the obligation
                         of the Company thereunder to make such payment shall
                         forthwith cease and be discharged, and, in the case of the
                         payment of principal and premium, if any, such bonds shall
                         be surrendered for cancellation or presented for appropriate
                         notation to the Trustee.
</TABLE>
<PAGE>   19
                                        17
<TABLE>
<S>                      <C>
REDEMPTION                 SECTION 2. Bonds of 1995 Series BP shall be redeemed on
OF BONDS OF              the date and in the respective principal amount which
1995 SERIES BP.          correspond to the redemption date for, and the principal
                         amount to be redeemed of, the Strategic Fund Revenue Bonds.
                         In the event the Company elects to redeem any Strategic Fund
                         Revenue Bonds prior to maturity in accordance with the
                         provisions of the Strategic Fund Trust Indenture, the
                         Company shall on the same date redeem bonds of 1995 Series
                         BP in the principal amount and at the redemption price
                         corresponding to the Strategic Fund Revenue Bonds so
                         redeemed. The Company agrees to give the Trustee notice of
                         any such redemption of bonds of 1995 Series BP on the same
                         date as it gives notice of redemption of Strategic Fund
                         Revenue Bonds to the Strategic Fund Trust Indenture Trustee.

REDEMPTION                 SECTION 3. In the event of an Event of Default under the
OF BONDS OF 1995 SERIES  Strategic Fund Trust Indenture and the acceleration of all
BP IN EVENT OF           Strategic Fund Revenue Bonds, the bonds of 1995 Series BP
ACCELERATION             shall be redeemable in whole upon receipt by the Trustee of
OF STRATEGIC FUND        a written demand (hereinafter called a "Redemption Demand")
REVENUE BONDS.           from the Strategic Fund Trust Indenture Trustee stating that
                         there has occurred under the Strategic Fund Trust Indenture
                         both an Event of Default and a declaration of acceleration
                         of payment of principal, accrued interest and premium, if
                         any, on the Strategic Fund Revenue Bonds, specifying the
                         last date to which interest on the Strategic Fund Revenue
                         Bonds has been paid (such date being hereinafter referred to
                         as the "Initial Interest Accrual Date") and demanding
                         redemption of the bonds of said series. The Trustee shall,
                         within five days after receiving such Redemption Demand,
                         mail a copy thereof to the Company marked to indicate the
                         date of its receipt by the Trustee. Promptly upon receipt by
                         the Company of such copy of a Redemption Demand, the Company
                         shall fix a date on which it will redeem the bonds of said
                         series so demanded to be redeemed (hereinafter called the
                         "Demand Redemption Date"). Notice of the date fixed as the
                         Demand Redemption Date shall be mailed by the Company to the
                         Trustee at least ten days prior to such Demand Redemption
                         Date. The date to be fixed by the Company as and for the
                         Demand Redemption Date may be any date up to and including
                         the earlier of (x) the 60th day after receipt by the Trustee
                         of the Redemption Demand or (y) the maturity date of such
                         bonds first occurring following the 20th day after the
                         receipt by the Trustee of the Redemption Demand; provided,
                         however, that if the Trustee shall not have received such
                         notice fixing the Demand Redemption Date on or before the
                         10th day preceding the earlier of such dates, the Demand
                         Redemption Date shall be deemed to be the earlier of such
                         dates. The Trustee shall mail notice of the Demand
                         Redemption Date (such notice being hereinafter called the
                         "Demand Redemption Notice") to the Strategic Fund Trust
                         Indenture Trustee not more than ten nor less than five days
                         prior to the Demand Redemption Date.
</TABLE>
<PAGE>   20
                                        18
<TABLE>
<S>                      <C>
                           Each bond of 1995 Series BP shall be redeemed by the
                         Company on the Demand Redemption Date therefore upon
                         surrender thereof by the Strategic Fund Trust Indenture
                         Trustee to the Trustee at a redemption price equal to the
                         principal amount thereof plus accrued interest thereon at
                         the rate specified for such bond from the Initial Interest
                         Accrual Date to the Demand Redemption Date plus an amount
                         equal to the aggregate premium, if any, due and payable on
                         such Demand Redemption Date on all Strategic Fund Revenue
                         Bonds; provided, however, that in the event of a receipt by
                         the Trustee of a notice that, pursuant to Section 604 of the
                         Strategic Fund Trust Indenture, the Strategic Fund Trust
                         Indenture Trustee has terminated proceedings to enforce any
                         right under the Strategic Fund Trust Indenture, then any
                         Redemption Demand shall thereby be rescinded by the
                         Strategic Fund Trust Indenture Trustee, and no Demand
                         Redemption Notice shall be given, or, if already given,
                         shall be automatically annulled; but no such rescission or
                         annulment shall extend to or affect any subsequent default
                         or impair any right consequent thereon.

                           Anything herein contained to the contrary notwithstanding,
                         the Trustee is not authorized to take any action pursuant to
                         a Redemption Demand and such Redemption Demand shall be of
                         no force or effect, unless it is executed in the name of the
                         Strategic Fund Trust Indenture Trustee by its President or
                         one of its Vice Presidents.

FORM OF BONDS              SECTION 4. The bonds of 1995 Series BP and the form of
OF 1995 SERIES BP.       Trustee's Certificate to be endorsed on such bonds shall be
                         substantially in the following forms, respectively:
</TABLE>
<PAGE>   21
                                        19

<TABLE>
<S>                      <C>
                                            [FORM OF FACE OF BOND]

                                          THE DETROIT EDISON COMPANY
                                     General and Refunding Mortgage Bond
                                  1995 Series BP, 6.20% due August 15, 2025

                           Notwithstanding any provisions hereof or in the Indenture,
                         this bond is not assignable or transferable except as may be
                         required to effect a transfer to any successor trustee under
                         the Trust Indenture, dated as of August 1, 1995 between the
                         Michigan Strategic Fund and Comerica Bank, as trustee, or,
                         subject to compliance with applicable law, as may be
                         involved in the course of the exercise of rights and
                         remedies consequent upon an Event of Default under said
                         Trust Indenture.

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

                           THE DETROIT EDISON COMPANY (hereinafter called the
                         "Company"), a corporation of the State of Michigan, for
                         value received, hereby promises to pay to the Michigan
                         Strategic Fund, or registered assigns, at the Company's
                         office or agency in the Borough of Manhattan, The City and
                         State of New York, the principal sum of
                         dollars ($          ) in lawful money of the United States
                         of America on the date specified in the title hereof and
                         interest thereon at the rate specified in the title hereof,
                         in like lawful money, from August 1, 1995, and after the
                         first payment of interest on bonds of this Series has been
                         made or otherwise provided for, from the most recent date to
                         which interest has been paid or otherwise provided for,
                         semi-annually on February 15 and August 15 of each year
                         (commencing February 15, 1996), until the Company's
                         obligation with respect to payment of said principal shall
                         have been discharged, all as provided, to the extent and in
                         the manner specified in the Indenture hereinafter mentioned
                         on the reverse hereof and in the supplemental indenture
                         pursuant to which this bond has been issued.

                           Under a Trust Indenture, dated as of August 1, 1995
                         (hereinafter called the "Strategic Fund Trust Indenture"),
                         between the Michigan Strategic Fund (hereinafter called
                         "Strategic Fund"), and Comerica Bank, as trustee
                         (hereinafter called the "Strategic Fund Trust Indenture
                         Trustee"), the Strategic Fund has issued Limited Obligation
                         Refunding Revenue Bonds (The Detroit Edison Company
                         Pollution Control Bonds Project), Collateralized Series
                         1995BB (hereinafter called the "Strategic Fund Revenue
                         Bonds"). This bond was originally issued to the Strategic
                         Fund and simultaneously irrevocably assigned to the
                         Strategic Fund Trust Indenture Trustee so as to secure the
                         payment of the Strategic Fund Revenue Bonds. Payments of
                         principal of, or premium, if any, or interest on, Strategic
                         Fund Revenue Bonds shall constitute like payments on this
                         bond as further provided herein and in the supplemental
                         indenture pursuant to which this bond has been issued.

                           Reference is hereby made to such further provisions of
                         this bond set forth on the reverse hereof and such further
                         provisions shall for all purposes have the same effect as
                         though set forth at this place.

                           This bond shall not be valid or become obligatory for any
                         purpose until Bankers Trust Company, the Trustee under the
                         Indenture hereinafter mentioned on the reverse hereof, or
                         its successor thereunder, shall have signed the form of
                         certificate endorsed hereon.
</TABLE>
<PAGE>   22
                                        20
<TABLE>
<S>                      <C>
                           IN WITNESS WHEREOF, THE DETROIT EDISON COMPANY has caused
                         this instrument to be executed by its Chairman of the Board
                         and its Vice President and Treasurer, with their manual or
                         facsimile signatures, and its corporate seal, or a facsimile
                         thereof, to be impressed or imprinted hereon and the same to
                         be attested by its Corporate Secretary or an Assistant
                         Corporate Secretary with his or her manual or facsimile
                         signature.
</TABLE>

<TABLE>
<S>                      <C>                                        <C>
                         Dated:                                     THE DETROIT EDISON COMPANY
                                                                    By ............................
                                                                    Chairman of the Board
                                                                    ............................
                                                                        Vice President
                         Attest:                                        and Treasurer
                         ............................
                         Vice President and
                         Corporate Secretary
</TABLE>
<PAGE>   23
                                        21

<TABLE>
<S>                      <C>
                                          [FORM OF REVERSE OF BOND]

                           This bond is one of an authorized issue of bonds of the
                         Company, unlimited as to amount except as provided in the
                         Indenture hereinafter mentioned or any indentures
                         supplemental thereto, and is one of a series of General and
                         Refunding Mortgage Bonds known as 1995 Series BP, limited to
                         an aggregate principal amount of $22,175,000, except as
                         otherwise provided in the Indenture hereinafter mentioned.
                         This bond and all other bonds of said series are issued and
                         to be issued under, and are all equally and ratably secured
                         (except insofar as any sinking, amortization, improvement or
                         analogous fund, established in accordance with the
                         provisions of the Indenture hereinafter mentioned, may
                         afford additional security for the bonds of any particular
                         series and except as provided in Section 3 of Article VI of
                         said Indenture) by an Indenture, dated as of October 1,
                         1924, duly executed by the Company to Bankers Trust Company,
                         a corporation of the State of New York, as Trustee, to which
                         Indenture and all indentures supplemental thereto (including
                         the Supplemental Indenture dated as of August 1, 1995)
                         reference is hereby made for a description of the properties
                         and franchises mortgaged and conveyed, the nature and extent
                         of the security, the terms and conditions upon which the
                         bonds are issued and under which additional bonds may be
                         issued, and the rights of the holders of the bonds and of
                         the Trustee in respect of such security (which Indenture and
                         all indentures supplemental thereto, including the
                         Supplemental Indenture dated as of August 1, 1995, are
                         hereinafter collectively called the "Indenture"). As
                         provided in the Indenture, said bonds may be for various
                         principal sums and are issuable in series, which may mature
                         at different times, may bear interest at different rates and
                         may otherwise vary as in said Indenture provided. With the
                         consent of the Company and to the extent permitted by and as
                         provided in the Indenture, the rights and obligations of the
                         Company and of the holders of the bonds and the terms and
                         provisions of the Indenture, or of any indenture
                         supplemental thereto, may be modified or altered in certain
                         respects by affirmative vote of at least eighty-five percent
                         (85%) in amount of the bonds then outstanding, and, if the
                         rights of one or more, but less than all, series of bonds
                         then outstanding are to be affected by the action proposed
                         to be taken, then also by affirmative vote of at least
                         eighty-five percent (85%) in amount of the series of bonds
                         so to be affected (excluding in every instance bonds
                         disqualified from voting by reason of the Company's interest
                         therein as specified in the Indenture); provided, however,
                         that, without the consent of the holder hereof, no such
                         modification or alteration shall, among other things, affect
                         the terms of payment of the principal of or the interest on
                         this bond, which in those respects is unconditional.

                           This bond is redeemable upon the terms and conditions set
                         forth in the Indenture, including provision for redemption
                         upon demand of the Strategic Fund Trust Indenture Trustee
                         following the occurrence of an Event of Default under the
                         Strategic Fund Trust Indenture and the acceleration of the
                         principal of the Strategic Fund Revenue Bonds.

                           Under the Indenture, funds may be deposited with the
                         Trustee (which shall have become available for payment), in
                         advance of the redemption date of any of the bonds of 1995
                         Series BP (or portions thereof), in trust for the redemption
                         of such bonds (or portions thereof) and the interest due or
                         to become due thereon, and thereupon all obligations of the
                         Company in respect of such bonds (or portions thereof) so to
                         be redeemed and such interest shall cease and be discharged,
                         and the holders thereof shall thereafter be restricted
                         exclusively to such funds for any and all claims of
                         whatsoever nature on their part under the Indenture or with
                         respect to such bonds (or portions thereof) and interest.

                           In case an event of default, as defined in the Indenture,
                         shall occur, the principal of all the bonds issued
                         thereunder may become or be declared due and payable, in the
                         manner, with the effect and subject to the conditions
                         provided in the Indenture.
</TABLE>
<PAGE>   24
                                        22
<TABLE>
<S>                      <C>
                           Upon payment of the principal of, or premium, if any, or
                         interest on, the Strategic Fund Revenue Bonds, whether at
                         maturity or prior to maturity by redemption or otherwise or
                         upon provision for the payment thereof having been made in
                         accordance with Articles I or IV of the Strategic Fund Trust
                         Indenture, bonds of 1995 Series BP in a principal amount
                         equal to the principal amount of such Strategic Fund Revenue
                         Bonds and having both a corresponding maturity date and
                         interest rate shall, to the extent of such payment of
                         principal, premium or interest, be deemed fully paid and the
                         obligation of the Company thereunder to make such payment
                         shall forthwith cease and be discharged, and, in the case of
                         the payment of principal and premium, if any, such bonds of
                         said series shall be surrendered for cancellation or
                         presented for appropriate notation to the Trustee.

                           This bond is not assignable or transferable except as may
                         be required to effect a transfer to any successor trustee
                         under the Strategic Fund Trust Indenture, or, subject to
                         compliance with applicable law, as may be involved in the
                         course of the exercise of rights and remedies consequent
                         upon an Event of Default under the Strategic Fund Trust
                         Indenture. Any such transfer shall be made by the registered
                         holder hereof, in person or by his attorney duly authorized
                         in writing, on the books of the Company kept at its office
                         or agency in the Borough of Manhattan, The City and State of
                         New York, upon surrender and cancellation of this bond, and
                         thereupon, a new registered bond of the same series of
                         authorized denominations for a like aggregate principal
                         amount will be issued to the transferee in exchange
                         therefor, and this bond with others in like form may in like
                         manner be exchanged for one or more new bonds of the same
                         series of other authorized denominations, but of the same
                         aggregate principal amount, all as provided and upon the
                         terms and conditions set forth in the Indenture, and upon
                         payment, in any event, of the charges prescribed in the
                         Indenture.

                           No recourse shall be had for the payment of the principal
                         of or the interest on this bond, or for any claim based
                         hereon or otherwise in respect hereof or of the Indenture,
                         or of any indenture supplemental thereto, against any
                         incorporator, or against any past, present or future
                         stockholder, director or officer, as such, of the Company,
                         or of any predecessor or successor corporation, either
                         directly or through the Company or any such predecessor or
                         successor corporation, whether for amounts unpaid on stock
                         subscriptions or by virtue of any constitution, statute or
                         rule of law, or by the enforcement of any assessment or
                         penalty or otherwise howsoever; all such liability being, by
                         the acceptance hereof and as part of the consideration for
                         the issue hereof, expressly waived and released by every
                         holder or owner hereof, as more fully provided in the
                         Indenture.
</TABLE>
<PAGE>   25
                                        23
<TABLE>
<S>                      <C>
                           [FORM OF TRUSTEE'S CERTIFICATE]

FORM OF                    This bond is one of the bonds, of the series designated
TRUSTEE'S                therein, described in the within-mentioned Indenture.
CERTIFICATE.
</TABLE>

                                              BANKERS TRUST COMPANY,

                                                              as Trustee

                                              By ...........................
                                                 Authorized Officer
<PAGE>   26
                                        24

<TABLE>
<S>                      <C>
                                                  PART III.
                                          RECORDING AND FILING DATA

RECORDING AND                The Original Indenture and indentures supplemental
FILING OF ORIGINAL       thereto have been recorded and/or filed and Certificates of
INDENTURE.               Provision for Payment have been recorded as hereinafter set
                         forth.

                             The Original Indenture has been recorded as a real
                         estate mortgage and filed as a chattel mortgage in the
                         offices of the respective Registers of Deeds of certain
                         counties in the State of Michigan as set forth in the
                         Supplemental Indenture dated as of September 1, 1947, has
                         been recorded as a real estate mortgage in the office of the
                         Register of Deeds of Genesee County, Michigan as set forth
                         in the Supplemental Indenture dated as of May 1, 1974, has
                         been filed in the Office of the Secretary of State of
                         Michigan on November 16, 1951 and has been filed and
                         recorded in the office of the Interstate Commerce Commission
                         on December 8, 1969.

RECORDING AND                Pursuant to the terms and provisions of the Original
FILING OF                Indenture, indentures supplemental thereto heretofore
SUPPLEMENTAL             entered into have been recorded as a real estate mortgage
INDENTURES.              and/or filed as a chattel mortgage or as a financing
                         statement in the offices of the respective Registers of
                         Deeds of certain counties in the State of Michigan, the
                         Office of the Secretary of State of Michigan and the Office
                         of the Interstate Commerce Commission, as set forth in
                         supplemental indentures as follows:
</TABLE>

<TABLE>
<CAPTION>
                                                                                             RECORDED AND/OR
                                                                                          FILED AS SET FORTH IN
                                   SUPPLEMENTAL                      PURPOSE OF               SUPPLEMENTAL
                                    INDENTURE                       SUPPLEMENTAL                INDENTURE
                                   DATED AS OF                       INDENTURE                DATED AS OF:
                                   ------------                     ------------          ---------------------
                        <S>                                 <C>                           <C>
                        June 1, 1925(a)(b)................  Series B Bonds                February 1, 1940
                        August 1, 1927(a)(b)..............  Series C Bonds                February 1, 1940
                        February 1, 1931(a)(b)............  Series D Bonds                February 1, 1940
                        June 1, 1931(a)(b)................  Subject Properties            February 1, 1940
                        October 1, 1932(a)(b).............  Series E Bonds                February 1, 1940
                        September 25, 1935(a)(b)..........  Series F Bonds                February 1, 1940
                        September 1, 1936(a)(b)...........  Series G Bonds                February 1, 1940
                        November 1, 1936(a)(b)............  Subject Properties            February 1, 1940
                        February 1, 1940(a)(b)............  Subject Properties            September 1, 1947
                        December 1, 1940(a)(b)............  Series H Bonds and            September 1, 1947
                                                              Additional Provisions
                        September 1, 1947(a)(b)(c)........  Series I Bonds,               November 15, 1951
                                                              Subject Properties and
                                                              Additional Provisions
                        March 1, 1950(a)(b)(c)............  Series J Bonds                November 15, 1951
                                                              and Additional Provisions
                        November 15, 1951(a)(b)(c)........  Series K Bonds                January 15, 1953
                                                              Additional Provisions and
                                                              Subject Properties
                        January 15, 1953(a)(b)............  Series L Bonds                May 1, 1953
                        May 1, 1953(a)....................  Series M Bonds                March 15, 1954
                                                              and Subject Properties
                        March 15, 1954(a)(c)..............  Series N Bonds                May 15, 1955
                                                              and Subject Properties
                        May 15, 1955(a)(c)................  Series O Bonds                August 15, 1957
                                                              and Subject Properties
                        August 15, 1957(a)(c).............  Series P Bonds                June 1, 1959
                                                              Additional Provisions and
                                                              Subject Properties
                        June 1, 1959(a)(c)................  Series Q Bonds                December 1, 1966
                                                              and Subject Properties
                        December 1, 1966(a)(c)............  Series R Bonds                October 1, 1968
                                                              Additional Provisions and
                                                              Subject Properties
</TABLE>
<PAGE>   27
                                        25

<TABLE>
<CAPTION>
                                                                                             RECORDED AND/OR
                                                                                          FILED AS SET FORTH IN
                                   SUPPLEMENTAL                      PURPOSE OF               SUPPLEMENTAL
                                    INDENTURE                       SUPPLEMENTAL                INDENTURE
                                   DATED AS OF                       INDENTURE                DATED AS OF:
                                   ------------                     ------------          ---------------------
                        <S>                                 <C>                           <C>
                        October 1, 1968(a)(c).............  Series S Bonds                December 1, 1969
                                                              and Subject Properties
                        December 1, 1969(a)(c)............  Series T Bonds                July 1, 1970
                                                              and Subject Properties
                        July 1, 1970(c)...................  Series U Bonds                December 15, 1970
                                                              and Subject Properties
                        December 15, 1970(c)..............  Series V and                  June 15, 1971
                                                              Series W Bonds
                        June 15, 1971(c)..................  Series X Bonds                November 15, 1971
                                                              and Subject Properties
                        November 15, 1971(c)..............  Series Y Bonds                January 15, 1973
                                                              and Subject Properties
                        January 15, 1973(c)...............  Series Z Bonds                May 1, 1974
                                                              and Subject Properties
                        May 1, 1974.......................  Series AA Bonds               October 1, 1974
                                                              and Subject Properties
                        October 1, 1974...................  Series BB Bonds               January 15, 1975
                                                              and Subject Properties
                        January 15, 1975..................  Series CC Bonds               November 1, 1975
                                                              and Subject Properties
                        November 1, 1975..................  Series DDP Nos. 1-9 Bonds     December 15, 1975
                                                              and Subject Properties
                        December 15, 1975.................  Series EE Bonds               February 1, 1976
                                                              and Subject Properties
                        February 1, 1976..................  Series FFR Nos. 1-13 Bonds    June 15, 1976
                        June 15, 1976.....................  Series GGP Nos. 1-7 Bonds     July 15, 1976
                                                              and Subject Properties
                        July 15, 1976.....................  Series HH Bonds               February 15, 1977
                                                              and Subject Properties
                        February 15, 1977.................  Series MMP Bonds and Subject  March 1, 1977
                                                              Properties
                        March 1, 1977.....................  Series IIP Nos. 1-7 Bonds,    June 15, 1977
                                                              Series JJP Nos. 1-7 Bonds,
                                                              Series KKP Nos. 1-7 Bonds
                                                              and Series LLP Nos. 1-7
                                                              Bonds
                        June 15, 1977.....................  Series FFR No. 14 Bonds and   July 1, 1977
                                                              Subject Properties
                        July 1, 1977......................  Series NNP Nos. 1-7 Bonds     October 1, 1977
                                                              and Subject Properties
                        October 1, 1977...................  Series GGP Nos. 8-22 Bonds    June 1, 1978
                                                              and Series OOP Nos. 1-17
                                                              Bonds and Subject
                                                              Properties
                        June 1, 1978......................  Series PP Bonds,              October 15, 1978
                                                              Series QQP Nos. 1-9 Bonds
                                                              and Subject Properties
                        October 15, 1978..................  Series RR Bonds               March 15, 1979
                                                              and Subject Properties
                        March 15, 1979....................  Series SS Bonds               July 1, 1979
                                                              and Subject Properties
</TABLE>
<PAGE>   28
                                        26

<TABLE>
<CAPTION>
                                                                                             RECORDED AND/OR
                                                                                          FILED AS SET FORTH IN
                                   SUPPLEMENTAL                      PURPOSE OF               SUPPLEMENTAL
                                    INDENTURE                       SUPPLEMENTAL                INDENTURE
                                   DATED AS OF                       INDENTURE                DATED AS OF:
                                   ------------                     ------------          ---------------------
                        <S>                                 <C>                           <C>
                        July 1, 1979......................  Series IIP Nos. 8-22 Bonds,   September 1, 1979
                                                              Series NNP Nos. 8-21 Bonds
                                                              and Series TTP Nos. 1-15
                                                              Bonds and Subject
                                                              Properties
                        September 1, 1979.................  Series JJP No. 8 Bonds,       September 15, 1979
                                                              Series KKP No. 8 Bonds,
                                                              Series LLP Nos. 8-15
                                                              Bonds, Series MMP No. 2
                                                              Bonds and Series OOP No.
                                                              18 Bonds and Subject
                                                              Properties
                        September 15, 1979................  Series UU Bonds               January 1, 1980
                        January 1, 1980...................  1980 Series A Bonds and       April 1, 1980
                                                              Subject Properties
                        April 1, 1980.....................  1980 Series B Bonds           August 15, 1980
                        August 15, 1980...................  Series QQP Nos. 10-19 Bonds,  August 1, 1981
                                                              1980 Series CP Nos. 1-12
                                                              Bonds and 1980 Series DP
                                                              No. 1-11 Bonds and Subject
                                                              Properties
                        August 1, 1981....................  1980 Series CP Nos. 13-25     November 1, 1981
                                                              Bonds and Subject
                                                              Properties
                        November 1, 1981..................  1981 Series AP Nos. 1-12      June 30, 1982
                                                              Bonds
                        June 30, 1982.....................  Article XIV Reconfirmation    August 15, 1982
                        August 15, 1982...................  1981 Series AP Nos. 13-14     June 1, 1983
                                                              and Subject Properties
                        June 1, 1983......................  1981 Series AP Nos. 15-16     October 1, 1984
                                                              and Subject Properties
                        October 1, 1984...................  1984 Series AP and 1984       May 1, 1985
                                                              Series BP Bonds and
                                                              Subject Properties
                        May 1, 1985.......................  1985 Series A Bonds           May 15, 1985
                        May 15, 1985......................  1985 Series B Bonds and       October 15, 1985
                                                              Subject Properties
                        October 15, 1985..................  Series KKP No. 9 Bonds and    April 1, 1986
                                                              Subject Properties
                        April 1, 1986.....................  1986 Series A and Subject     August 15, 1986
                                                              Properties
                        August 15, 1986...................  1986 Series B and Subject     November 30, 1986
                                                              Properties
                        November 30, 1986.................  1986 Series C                 January 31, 1987
                        January 31, 1987..................  1987 Series A                 April 1, 1987
                        April 1, 1987.....................  1987 Series B and 1987        August 15, 1987
                                                              Series C
                        August 15, 1987...................  1987 Series D and 1987        November 30, 1987
                                                              Series E and Subject
                                                              Properties
                        November 30, 1987.................  1987 Series F                 June 15, 1989
                        June 15, 1989.....................  1989 Series A                 July 15, 1989
</TABLE>
<PAGE>   29
                                        27

<TABLE>
<CAPTION>
                                                                                             RECORDED AND/OR
                                                                                          FILED AS SET FORTH IN
                                   SUPPLEMENTAL                      PURPOSE OF               SUPPLEMENTAL
                                    INDENTURE                       SUPPLEMENTAL                INDENTURE
                                   DATED AS OF                       INDENTURE                DATED AS OF:
                                   ------------                     ------------          ---------------------
                        <S>                                 <C>                           <C>
                        July 15, 1989.....................  Series KKP No. 10             December 1, 1989
                        December 1, 1989..................  Series KKP No. 11 and 1989    February 15, 1990
                                                              Series BP
                        February 15, 1990.................  1990 Series A, 1990 Series    November 1, 1990
                                                              B, 1990 Series C, 1990
                                                              Series D, 1990 Series E
                                                              and 1990 Series F
                        November 1, 1990..................  Series KKP No. 12             April 1, 1991
                        April 1, 1991.....................  1991 Series AP                May 1, 1991
                        May 1, 1991.......................  1991 Series BP and 1991       May 15, 1991
                                                              Series CP
                        May 15, 1991......................  1991 Series DP                September 1, 1991
                        September 1, 1991.................  1991 Series EP                November 1, 1991
                        November 1, 1991..................  1991 Series FP                January 15, 1992
                        January 15, 1992..................  1992 Series BP                February 29, 1992 and
                                                                                          April 15, 1992
                        February 29, 1992.................  1992 Series AP                April 15, 1992
                        April 15, 1992....................  Series KKP No. 13             July 15, 1992
                        July 15, 1992.....................  1992 Series CP                November 30, 1992
                        July 31, 1992.....................  1992 Series D                 November 30, 1992
                        April 1, 1986.....................  1986 Series A and Subject     August 15, 1986
                                                              Properties
                        August 15, 1986...................  1986 Series B and Subject     November 30, 1986
                                                              Properties
                        November 30, 1986.................  1986 Series C                 January 31, 1987
                        January 31, 1987..................  1987 Series A                 April 1, 1987
                        April 1, 1987.....................  1987 Series B and 1987        August 15, 1987
                                                              Series C
                        August 15, 1987...................  1987 Series D and 1987        November 30, 1987
                                                              Series E and Subject
                                                              Properties
                        November 30, 1987.................  1987 Series F                 June 15, 1989
                        June 15, 1989.....................  1989 Series A                 July 15, 1989
                        July 15, 1989.....................  Series KKP No. 10             December 1, 1989
                        December 1, 1989..................  Series KKP No. 11 and 1989    February 15, 1990
                                                              Series BP
                        February 15, 1990.................  1990 Series A, 1990 Series    November 1, 1990
                                                              B, 1990 Series C, 1990
                                                              Series D, 1990 Series E
                                                              and 1990 Series F
                        November 1, 1990..................  Series KKP No. 12             April 1, 1991
                        April 1, 1991.....................  1991 Series AP                May 1, 1991
                        May 1, 1991.......................  1991 Series BP and 1991       May 15, 1991
                                                              Series CP
                        May 15, 1991......................  1991 Series DP                September 1, 1991
                        September 1, 1991.................  1991 Series EP                November 1, 1991
                        November 1, 1991..................  1991 Series FP                January 15, 1992
</TABLE>
<PAGE>   30
                                        28

<TABLE>
<CAPTION>
                                                                                             RECORDED AND/OR
                                                                                          FILED AS SET FORTH IN
                                   SUPPLEMENTAL                      PURPOSE OF               SUPPLEMENTAL
                                    INDENTURE                       SUPPLEMENTAL                INDENTURE
                                   DATED AS OF                       INDENTURE                DATED AS OF:
                                   ------------                     ------------          ---------------------
                        <S>                                 <C>                           <C>
                        January 15, 1992..................  1992 Series BP                February 29, 1992 and
                                                                                          April 15, 1992
                        February 29, 1992.................  1992 Series AP                April 15, 1992
                        April 15, 1992....................  Series KKP No. 13             July 15, 1992
                        July 15, 1992.....................  1992 Series CP                November 30, 1992
                        November 30, 1992.................  1992 Series E and 1993        March 15, 1993
                                                              Series D
                        December 15, 1992.................  Series KKP No. 14 and 1989    March 15, 1992
                                                              Series BP No. 2
                        January 1, 1993...................  1993 Series C                 April 1, 1993
                        March 1, 1993.....................  1993 Series E                 June 30, 1993
                        March 15, 1993....................  1993 Series D                 September 15, 1993
                        April 1, 1993.....................  1993 Series FP and 1993       September 15, 1993
                                                              Series IP
                        April 26, 1993....................  1993 Series G and Amendment   September 15, 1993
                                                              of Article II, Section 5
                        May 31, 1993......................  1993 Series J                 September 15, 1993
                        September 15, 1993................  1993 Series K                 March 1, 1994
                        March 1, 1994.....................  1994 Series AP                June 15, 1994
                        June 15, 1994.....................  1994 Series BP                December 1, 1994
                        August 15, 1994...................  1994 Series C                 December 1, 1994
                        December 1, 1994..................  Series KKP No. 15 and 1994    August 1, 1995
                                                              Series DP
</TABLE>

                 ------------------------------------------
                 (a) See Supplemental Indenture dated as of July 1, 1970 for
                     Interstate Commerce Commission filing and recordation
                     information.

                 (b) See Supplemental Indenture dated as of May 1, 1953 for
                     Secretary of State of Michigan filing information.

                 (c) See Supplemental Indenture dated as of May 1, 1974 for
                     County of Genesee, Michigan recording and filing
                     information.
<PAGE>   31
                                        29

<TABLE>
<S>                      <C>
                             Further, pursuant to the terms and provisions of the
                         Original Indenture, a Supplemental Indenture dated as
                         December 1, 1994 providing for the terms of bonds to be
                         issued thereunder of Series KKP No. 15 and 1994 Series DP
                         has heretofore been entered into between the Company and the
                         Trustee and has been filed in the Office of the Secretary of
                         State of Michigan as a financing statement on March 29, 1994
                         (Filing No. 41262B), has been filed and recorded in the
                         Office of the Interstate Commerce Commission (Recordation
                         No. 5485-MMMM) on March 29, 1994, and has been recorded as a
                         real estate mortgage in the offices of the respective
                         Register of Deeds of certain counties in the State of
                         Michigan, as follows:
</TABLE>

<TABLE>
<CAPTION>
                                                                                    LIBER OF
                                                                                    MORTGAGES
                                                                                    OR COUNTY
                                             COUNTY                       RECORDED   RECORDS      PAGE
                                             ------                       --------  ---------     ----
                        <S>                                               <C>       <C>         <C>
                        Genesee.........................................  3-30-94    3013        800-823
                        Huron...........................................  3-29-94     623        481-504
                        Ingham..........................................  3-30-94    2164        976-999
                        Lapeer..........................................  3-29-94     850        362-385
                        Lenawee.........................................  3-29-94    1306        122-145
                        Livingston......................................  3-29-94    1812       0662-0685
                        Macomb..........................................  3-29-94    06275       627-650
                        Mason...........................................  3-29-94     438       1607-1630
                        Monroe..........................................  3-30-94    1371       0909-0932
                        Oakland.........................................  3-29-94    14565       148-171
                        St. Clair.......................................  3-29-94    1338        776-799
                        Sanilac.........................................  3-29-94     454        784-807
                        Tuscola.........................................  3-30-94     656        497-520
                        Washtenaw.......................................  3-29-94    2956        926-949
                        Wayne...........................................  3-29-94    27268       90-113
</TABLE>
<PAGE>   32
                                        30

<TABLE>
<S>                      <C>
RECORDING OF                 All the bonds of Series A which were issued under the
CERTIFICATES             Original Indenture dated as of October 1, 1924, and of
OF PROVISION             Series B, C, D, E, F, G, H, I, J, K, L, M, N, O, P, Q, W, Y,
FOR PAYMENT.             Z, AA, BB, CC, DDP Nos. 1-9, FFR Nos. 1-14, GGP Nos. 1-22,
                         HH, IIP Nos. 1-22, JJP Nos. 1-8, KKP Nos. 1-8, LLP Nos.
                         1-15, NNP Nos. 1-21, OOP Nos. 1-18, QQP Nos. 1-17, TTP Nos.
                         1-15, UU, 1980 Series A, 1980 Series CP Nos. 1-25, 1980
                         Series DP Nos. 1-11, 1981 Series AP Nos. 1-16, 1984 Series
                         AP, 1984 Series BP, 1985 Series A, 1985 Series B, 1987
                         Series A, PP, RR, EE, MMP, MMP No. 2 and 1989 Series A which
                         were issued under Supplemental Indentures dated as of,
                         respectively, June 1, 1925, August 1, 1927, February 1,
                         1931, October 1, 1932, September 25, 1935, September 1,
                         1936, December 1, 1940, September 1, 1947, November 15,
                         1951, January 15, 1953, May 1, 1953, March 15, 1954, May 15,
                         1955, August 15, 1957, December 15, 1970, November 15, 1971,
                         January 15, 1973, May 1, 1974, October 1, 1974, January 15,
                         1975, November 1, 1975, February 1, 1976, June 15, 1976,
                         July 15, 1976, October 1, 1977, March 1, 1977, July 1, 1979,
                         March 1, 1977, March 1, 1977, March 1, 1977, September 1,
                         1979, July 1, 1977, July 1, 1979, September 15, 1979,
                         October 1, 1977, June 1, 1978, October 1, 1977, July 1,
                         1979, January 1, 1980, August 15, 1980, November 1, 1981,
                         October 1, 1984, May 1, 1985, May 15, 1985, January 31,
                         1987, June 1, 1978, October 15, 1978, December 15, 1975,
                         February 15, 1977, September 1, 1979 and June 15, 1989 have
                         matured or have been called for redemption and funds
                         sufficient for such payment or redemption have been
                         irrevocably deposited with the Trustee for that purpose; and
                         Certificates of Provision for Payment have been recorded in
                         the offices of the respective Registers of Deeds of certain
                         counties in the State of Michigan, with respect to all bonds
                         of Series A, B, C, D, E, F, G, H, K, L, M, O, W, BB, CC, DDP
                         Nos. 1 and 2, FFR Nos. 1-3, GGP Nos. 1 and 2, IIP No. 1, JJP
                         No. 1, KKP No. 1, LLP No. 1 and GGP No. 8.

                                                   PART IV.
                                                 THE TRUSTEE.

TERMS AND                    The Trustee hereby accepts the trust hereby declared and
CONDITIONS OF            provided, and agrees to perform the same upon the terms and
ACCEPTANCE OF            conditions in the Original Indenture, as amended to date and
TRUST BY TRUSTEE.        as supplemented by this Supplemental Indenture, and in this
                         Supplemental Indenture set forth, and upon the following
                         terms and conditions:
                             The Trustee shall not be responsible in any manner
                         whatsoever for and in respect of the validity or sufficiency
                         of this Supplemental Indenture or the due execution hereof
                         by the Company or for or in respect of the recitals
                         contained herein, all of which recitals are made by the
                         Company solely.

                                                   PART V.
                                                MISCELLANEOUS.

CONFIRMATION OF              Except to the extent specifically provided therein, no
SECTION 318(C) OF        provision of this supplemental indenture or any future
TRUST INDENTURE          supplemental indenture is intended to modify, and the
ACT                      parties do hereby adopt and confirm, the provisions of
                         Section 318(c) of the Trust Indenture Act which amend and
                         supercede provisions of the Indenture in effect prior to
                         November 15, 1990.
EXECUTION IN                 THIS SUPPLEMENTAL INDENTURE MAY BE SIMULTANEOUSLY
COUNTERPARTS.            EXECUTED IN ANY NUMBER OF COUNTERPARTS, EACH OF WHICH WHEN
                         SO EXECUTED SHALL BE DEEMED TO BE AN ORIGINAL; BUT SUCH
                         COUNTERPARTS SHALL TOGETHER CONSTITUTE BUT ONE AND THE SAME
                         INSTRUMENT.
</TABLE>
<PAGE>   33
                                        31
<TABLE>
<S>                      <C>
TESTIMONIUM.                 IN WITNESS WHEREOF, THE DETROIT EDISON COMPANY AND
                           BANKERS TRUST COMPANY HAVE CAUSED THESE PRESENTS TO BE
                         SIGNED IN THEIR RESPECTIVE CORPORATE NAMES BY THEIR
                         RESPECTIVE CHAIRMEN OF THE BOARD, PRESIDENTS, VICE
                         PRESIDENTS, ASSISTANT VICE PRESIDENTS, TREASURERS OR
                         ASSISTANT TREASURERS AND IMPRESSED WITH THEIR RESPECTIVE
                         CORPORATE SEALS, ATTESTED BY THEIR RESPECTIVE SECRETARIES,
                         ASSISTANT SECRETARIES, TREASURERS OR ASSISTANT TREASURERS
                         ALL AS OF THE DAY AND YEAR FIRST ABOVE WRITTEN.
</TABLE>

<TABLE>
<S>                      <C>                                              <C>
                                                                          THE DETROIT EDISON COMPANY,
                         (Corporate Seal)                                 By  ____________________
                                                                                   C. C. Arvani
                                                                               Assistant Treasurer

EXECUTION.               Attest:
                         _______________________________
                                 Elaine M. Godfrey
                           Assistant Corporate Secretary

                         Signed, sealed and delivered by THE DETROIT
                         EDISON COMPANY, in the presence of
                         _______________________________
                                 Jack L. Somers
                         _______________________________
                                 Cathy M. Lewis
</TABLE>

<TABLE>
<S>                      <C>
                         STATE OF MICHIGAN
                                          SS.:
                         COUNTY OF WAYNE
ACKNOWLEDGEMENT          On this      day of August, 1995, before me, the subscriber,
OF EXECUTION             a Notary Public within and for the County of Wayne, in the
BY COMPANY.              State of Michigan, personally appeared C. C. Arvani, to me
                         personally known, who, being by me duly sworn, did say that
                         he does business at 2000 Second Avenue, Detroit, Michigan
                         48226 and is the Assistant Treasurer of THE DETROIT EDISON
                         COMPANY, one of the corporations described in and which
                         executed the foregoing instrument; that he knows the
                         corporate seal of the said corporation and that the seal
                         affixed to said instrument is the corporate seal of said
                         corporation; and that said instrument was signed and sealed
                         in behalf of said corporation by authority of its Board of
                         Directors and that he subscribed his name thereto by like
                         authority; and said C. C. Arvani, acknowledged said
                         instrument to be the free act and deed of said corporation.
</TABLE>

<TABLE>
<S>                      <C>                                           <C>
                                                                                   ___________________________
                                        (Notarial Seal)                            Judith Thun, Notary Public
                                                                                        Wayne County, MI
                                                                                  My Commission Expires 6-6-99
</TABLE>
<PAGE>   34
                                        32

<TABLE>
<S>                      <C>                                              <C>
                                                                          BANKERS TRUST COMPANY,
                         (Corporate Seal)                                 By  ________________________
                                                                                  James McDonough
                                                                              Assistant Vice President
                         Attest:
                         _________________________
                                Scott Thiel
                            Assistant Treasurer

                         Signed, sealed and delivered by
                         BANKERS TRUST COMPANY, in the
                         presence of
                         _________________________
                             Gina Evangelista
                         _________________________
                            Jason C. Theriault
</TABLE>

<TABLE>
<S>                      <C>                                           <C>

                         STATE OF NEW YORK
                                             SS.:
                         COUNTY OF NEW YORK
</TABLE>

<TABLE>
<S>                      <C>

ACKNOWLEDGEMENT          On this      day of August, 1995, before me, the subscriber,
OF EXECUTION             a Notary Public within and for the County of New York, in
BY TRUSTEE.              the State of New York, personally appeared James McDonough,
                         to me personally known, who, being by me duly sworn, did say
                         that his business office is located at Four Albany Street,
                         New York, New York 10015, and he is Assistant Vice President
                         of BANKERS TRUST COMPANY, one of the corporations described
                         in and which executed the foregoing instrument; that he
                         knows the corporate seal of the said corporation and that
                         the seal affixed to said instrument is the corporate seal of
                         said corporation; and that said instrument was signed and
                         sealed in behalf of said corporation by authority of its
                         Board of Directors and that he subscribed his name thereto
                         by like authority; and said James McDonough acknowledged
                         said instrument to be the free act and deed of said
                         corporation.
</TABLE>

<TABLE>
<S>                      <C>                                           <C>
                                        (Notarial Seal)
                                                                                ________________________________
                                                                                           Carol Allen
                                                                                Notary Public, State of New York
                                                                                         No. 24-4820187
                                                                                    Qualified in Kings County
                                                                                   Commission Expires 2-16-96
</TABLE>
<PAGE>   35
                                        33

STATE OF MICHIGAN
                               SS.:
COUNTY OF WAYNE

<TABLE>
<S>                      <C>

AFFIDAVIT AS TO          C. C. Arvani, being duly sworn, says: that he is the
CONSIDERATION            Assistant Treasurer of THE DETROIT EDISON COMPANY, the
AND GOOD FAITH.          Mortgagor named in the foregoing instrument, and that he has
                         knowledge of the facts in regard to the making of said
                         instrument and of the consideration therefor; that the
                         consideration for said instrument was and is actual and
                         adequate, and that the same was given in good faith for the
                         purposes in such instrument set forth.
</TABLE>

<TABLE>
<S>                      <C>                                              <C>
                                                                                          ________________
                                                                                            C. C. Arvani
                              Sworn to before me this        day of
                                           August, 1995

                                    ___________________________
                                    Judith Thun, Notary Public
                                         Wayne County, MI
                                   My Commission Expires 6-6-99
                                         (Notarial Seal)

                    This instrument was drafted by Frances B. Rohlman, Esq., 2000 Second
                                      Avenue, Detroit, Michigan 48226
</TABLE><PAGE>   1
                                                                  EXHIBIT 10-40*

                            INDEMNIFICATION AGREEMENT

         This Indemnification Agreement ("Agreement") is made as of the ____ day
of _______________, _______ by and between The Detroit Edison Company, a
Michigan corporation (the "Company"), and __________________, an officer of the
Company (the "Indemnitee").

         RECITALS

         A.   The Indemnitee is presently serving as an officer of the Company
and the Company desires the Indemnitee to continue in such capacity. The
Indemnitee is willing, subject to certain conditions, including without
limitation the execution and performance of this Agreement by the Company, to
continue in that capacity.

         B.    In addition to the indemnification to which the Indemnitee is
entitled under the Articles of Incorporation (the "Articles") or By-Laws of the
Company in effect from time to time, the Company has obtained at its sole
expense insurance protecting its officers and directors, including the
Indemnitee, against certain losses arising out of actual or threatened actions,
suits or proceedings to which such persons may be made or threatened to be made
parties. However, as a result of circumstances having no relation to, and beyond
the control of, the Company and the Indemnitee, there can be no assurance of the
continuation, renewal or scope of that insurance.

         Accordingly, and in order to induce the Indemnitee to continue to serve
in the Indemnitee's present capacity, the Company and Indemnitee agree as
follows:

                                      -1-

<PAGE>   2

         1.   Continued Service.   The Indemnitee will continue to serve as an
officer of the Company so long as the Indemnitee is duly elected and qualified
in accordance with the By-Laws of the Company in effect from time to time or
until the Indemnitee resigns in writing in accordance with applicable law.

         2.   Initial Indemnity.

              (a)  The Company shall indemnify the Indemnitee when the
Indemnitee was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative and whether formal or informal, other
than an action by or in the right of the Company, by reason of the fact that the
Indemnitee is or was a director, officer, employee or agent of the Company, or
is or was serving at the request of the Company as a director, officer, employee
or agent of another foreign or domestic corporation, partnership, joint venture,
trust or other enterprise, whether for profit or not, against expenses,
including attorneys' fees, judgments, penalties, fines and amounts paid in
settlement actually and reasonably incurred by the Indemnitee in connection with
such action, suit or proceeding if the Indemnitee acted in good faith and in a
manner the Indemnitee reasonably believed to be in, or not opposed to the best
interests of the Company or its shareholders, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe such conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction or upon a plea of nolo contendere or its equivalent shall
not, of itself, create a presumption that the Indemnitee did not act in good
faith and in a manner which the Indemnitee reasonably believed to be in or not
opposed to the best interests of the

                                      -2-

<PAGE>   3

Company or its shareholders and, with respect to any criminal action or
proceeding, that the Indemnitee had reasonable cause to believe that such
conduct was unlawful.

              (b)  The Company shall indemnify the Indemnitee when the
Indemnitee was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
Company to procure a judgment in its favor by reason of the fact that the
Indemnitee is or was a director, officer, employee, or agent of the Company, or
is or was serving or had agreed to serve at the request of the Company as a
director, officer, partner, trustee, employee or agent of another foreign or
domestic corporation, partnership, joint venture, trust or other enterprise,
whether for profit or not, against expenses, including attorneys' fees and
amounts paid in settlement actually and reasonably incurred by the Indemnitee in
connection with the action or suit, if the Indemnitee acted in good faith and in
a manner the Indemnitee reasonably believed to be in, or not opposed to the best
interests of the Company or its shareholders. Indemnification shall not be made
for a claim, issue or matter in which the Indemnitee has been found liable to
the Company except to the extent the Court conducting the proceeding or another
court of competent jurisdiction shall determine upon application that the
Indemnitee is fairly and reasonably entitled to indemnification in view of all
relevant circumstances whether or not the Indemnitee met the standard of conduct
set forth in this paragraph (b) or was so adjudged liable to the Company,
provided that if the Indemnitee was adjudged liable, such indemnification is
limited to reasonable expenses incurred.

              (c)  To the extent that the Indemnitee has been successful, on the
merits or otherwise, in defense of any action, suit or proceeding referred to in
Section 2(a) or 2(b) hereof, or in defense of any claim, issue or matter in the
action, suit or proceeding, the Indemnitee shall

                                       -3-

<PAGE>   4

be indemnified against actual and reasonable expenses, including attorneys' fees
incurred by the Indemnitee in connection with the action, suit or proceeding and
an action suit or proceeding brought to enforce the mandatory indemnification
provided in this Section.

              (d)  Any indemnification under Section 2(a) or 2(b) (unless
ordered by a court) shall be made by the Company only as authorized in the
specific case upon a determination in accordance with Section 4 hereof or any
applicable provision of the Articles of Incorporation of the Company in effect
from time to time, By-Laws, other agreement, resolution or otherwise. Such
determination shall be made (i) by a majority vote of a quorum of the Board of
Directors of the Company (the "Board") consisting of directors who are not
parties or threatened to be made parties to such action, suit or proceeding or
(ii) if such a quorum is not obtainable, by a majority vote of a committee duly
designated by the Board consisting solely of two or more directors not at the
time parties or threatened to be made parties to the suit, action, or proceeding
or (iii) by independent legal counsel (designated in the manner provided below
in this subsection (d)) in a written opinion or (iv) by all independent
directors who are not parties to such action, suit or proceeding or (v) by the
shareholders of the Company (the "Shareholders"), but shares held by directors,
officers, employees or agents who are parties or threatened to be made parties
to the action suit or proceeding may not be voted. Independent legal counsel
shall be designated by the Board or its Committee in the manner prescribed in
Section 2(d)(i) or 2(d)(ii); provided, however, that if the Board is unable or
fails to so designate, such designation shall be made by the Indemnitee subject
to the approval of the Company (which approval shall not be unreasonably
withheld). In the designation of a committee under subsection 2(d)(ii) or the
selection of independent legal counsel by the Board, all directors may
participate. Independent

                                      -4-

<PAGE>   5

legal counsel shall not be any person or firm who, under the applicable
standards of professional conduct then prevailing, would have a conflict of
interest in representing either the Company or the Indemnitee in an action to
determine the Indemnitee's rights under this Agreement. The Company agrees to
pay the reasonable fees and expenses of such independent legal counsel and to
indemnify fully such counsel against costs, charges and expenses (including
attorneys' and others' fees and expenses) actually and reasonably incurred by
such counsel in connection with this Agreement or the opinion of such counsel
pursuant hereto.

              (e) If the Indemnitee is entitled to indemnification under Section
2(a) or 2(b) for a portion of expenses, including reasonable attorneys' fees,
judgments, penalties, fines and amounts paid in settlement, but not for the
total amount, the Company shall indemnify the Indemnitee for the portion of the
expenses, judgments, penalties, fines or amounts paid in settlement for which
the Indemnitee is entitled to be indemnified.

              (f)  The Company shall pay or reimburse the reasonable expenses
(including attorneys' and others' fees and expenses) incurred by the Indemnitee
in the Indemnitee's capacity as a director or officer of the Company who is a
party or threatened to be made a party to an action, suit or proceeding in
advance of the final disposition of such action, suit or proceeding subject to
the provisions of and in the manner prescribed by Section 4(b) hereof.

              (g)  The Company shall not adopt any amendment to the Articles or
By-Laws the effect of which would be to deny, diminish or encumber the
Indemnitee's rights to indemnity pursuant to the Articles, By-Laws, the Business
Corporation Act of the State of Michigan (the "BCA") or any other applicable law
as applied to any act or failure to act occurring in whole or in part prior to
the date (the "Effective Date") upon which the amendment was approved by the

                                      -5-
<PAGE>   6
Board or the Shareholders, as the case may be. In the event that the Company
shall adopt any amendment to the Articles or By-Laws the effect of which is to
so deny, diminish or encumber the Indemnitee's rights to indemnity, such
amendment shall apply only to acts or failures to act occurring entirely after
the Effective Date thereof unless the Indemnitee shall have voted in favor of
such adoption as a officer or holder of record of the Company's voting stock,
as the case may be.

              (b) Upon application to a court by the Indemnitee pursuant to
Section 564c of the BCA, and a determination of such court that the Indemnitee
is fairly and reasonably entitled to indemnification, the Company shall pay to
the Indemnitee the amount so ordered by the court.

         3. Additional Indemnification.

              (a) Pursuant to Section 565 of the BCA, without limiting any right
which the Indemnitee may have pursuant to Section 2 hereof, the Articles, the
By-Laws, the BCA, any policy of insurance or otherwise, but subject to the
limitations on the maximum permissible indemnity which may exist under
applicable law at the time of any request for indemnity hereunder determined as
contemplated by Section 3(a) hereof, the Company shall indemnify the Indemnitee
against any amount which the Indemnitee is or becomes legally obligated to pay
relating to or arising out of any claim made against the Indemnitee because of
any act, failure to act or neglect or breach of duty, including any actual or
alleged error, misstatement or misleading statement, which the Indemnitee
commits, suffers, permits or acquiesces in while acting in such capacity as an
officer or director of the Company, or, at the request of the Company, as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise. The payments which the Company is obligated
to make pursuant to this

                                      -6-

<PAGE>   7

Section 3 shall include without limitation damages, judgments, settlements and
charges, costs, expenses, expenses of investigation and expenses of defense of
legal actions, suits, proceedings or claims and appeals therefrom, and expenses
of appeal, attachment or similar bonds; provided, however, that the Company
shall not be obligated under this Section 3(a) to make any payment in connection
with any claim against the Indemnitee:

         (i) to the extent of any fine or similar governmental imposition which
         the Company is prohibited by applicable law from paying which results
         from a final nonappealable order; or

         (ii) to the extent based upon or attributable to the Indemnitee gaining
         in fact a personal profit to which the Indemnitee was not legally
         entitled, including without limitation profits made from the purchase
         and sale by the Indemnitee of equity securities of the Company which
         are recoverable by the Company pursuant to Section 16(b) of the
         Securities Exchange Act of 1934, as amended, and profits arising from
         transactions in publicly traded securities of the Company which were
         effected by the Indemnitee in violation of Section 10(b) of the
         Securities Exchange Act of 1934, as amended, including Rule 10b-5
         promulgated thereunder.

The determination of whether the Indemnitee shall be entitled to indemnification
under this Section 3(a) may be, but shall not be required to be, made in
accordance with Section 4(a) hereof. If that determination is so made, it shall
be binding upon the Company and the Indemnitee for all purposes.

              (b) Expenses (including without limitation attorneys' and others'
fees and expenses) incurred by Indemnitee in defending any actual or threatened
civil or criminal action,

                                      -7-

<PAGE>   8

suit, proceeding or claim shall be paid by the Company in advance of the final
disposition thereof as authorized in accordance with Section 4(b) hereof.

         4. Certain Procedures Relating to Indemnification and Advancement of
Expenses.

              (a) Except as otherwise permitted or required by the BCA, for
purposes of pursuing the Indemnitee's rights to indemnification under Section
2(a), 2(b) or 3(a) hereof, as the case may be, the Indemnitee may, but shall not
be required to, (i) submit to the Board a sworn statement of request for
indemnification substantially in the form of Exhibit 1 attached hereto and made
a part hereof (the "Indemnification Statement") averring that the Indemnitee is
entitled to indemnification hereunder; and (ii) present to the Company
reasonable evidence of all expenses for which payment is requested. Submission
of an Indemnification Statement to the Board shall create a presumption that the
Indemnitee is entitled to indemnification under Section 2(a), 2(b) or 3(a)
hereof, as the case may be, and the Board shall be deemed to have determined
that the Indemnitee is entitled to such indemnification unless within 30
calendar days after submission of the Indemnification Statement the Board shall
determine by vote of a majority of the directors at a meeting at which a quorum
is present, based upon clear and convincing evidence (sufficient to rebut the
foregoing presumption), and the Indemnitee shall have received notice within
such period in writing of such determination, that the Indemnitee is not so
entitled to indemnification. No such determination shall be effective unless
written notice thereof, disclosing with particularity the evidence in support of
the Board's determination, shall have been given to the Indemnitee within 30
calendar days after submission of the Indemnification Statement. The foregoing
notice shall be sworn to by all persons who participated in the determination
and voted to deny indemnification. The provisions of this

                                      -8-

<PAGE>   9

Section 4(a) are intended to be procedural only and shall not affect the right
of the Indemnitee to indemnification under this Agreement, and any determination
by the Board that the Indemnitee is not entitled to indemnification and any
failure to make the payments requested in the Indemnification Statement shall be
subject to judicial review as provided in Section 6 hereof.

              (b) For purposes of determining whether to authorize advancement
of expenses pursuant to Section 2(e) hereof, the Indemnitee shall submit to the
Board a sworn statement of request for advancement of expenses substantially in
the form of Exhibit 2 attached hereto and made a part hereof (the
"Undertaking"), averring that (i) the Indemnitee, in good faith, believes that
the applicable standards of conduct set forth in Section 2(a), 2(b) or 3(a), as
the case may be, have been met, (ii) the Indemnitee has reasonably incurred or
will reasonably incur actual expenses in defending an actual civil or criminal
action, suit, proceeding or claim and (iii) the Indemnitee undertakes to repay
such amount if it shall ultimately be determined that the Indemnitee did not
meet the applicable standard of conduct or is not entitled to be indemnified by
the Company under this Agreement or otherwise. For purposes of requesting
advancement of expenses pursuant to Section 3(b) hereof, the Indemnitee may, but
shall not be required to, submit an Undertaking or such other form of request as
the Indemnitee determines to be appropriate (an "Expense Request"). Upon receipt
of an Undertaking or Expense Request, as the case may be, such payments shall
immediately be made by the Company provided that a determination is made that
facts then known to those making the determination would not preclude
indemnification under the BCA. Such determination shall be made within 10
calendar days of the date of receipt by the Company of the Expense Request and
shall be made in the manner specified in Section 2(d). No security shall be
required in connection with any

                                      -9-

<PAGE>   10

Undertaking or Expense Request and any Undertaking or Expense Request shall be
accepted without reference to the Indemnitee's ability to make repayment.

         5. Subrogation: Duplication of Payments.

              (a) In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of the Indemnitee, who shall execute all papers required and shall do
everything that may be necessary to secure such rights, including the execution
of such documents necessary to enable the Company effectively to bring suit to
enforce such rights.

              (b) The Company shall not be liable under this Agreement to make
any payment in connection with any claim made against the Indemnitee to the
extent the Indemnitee has actually received payment (under any insurance policy,
the Articles, the By-Laws or otherwise) of the amounts otherwise payable
hereunder.

         6. Enforcement.

              (a) If a claim for indemnification made to the Company pursuant to
Section 4 hereof is not paid in full by the Company within 30 calendar days
after a written claim has been received by the Company, the Indemnitee may at
any time thereafter bring suit against the Company to recover the unpaid amount
of the claim.

              (b) In any action brought under Section 6(a) hereof, it shall be a
defense to a claim for indemnification pursuant to Section 2(a) or 2(b) hereof
that the Indemnitee has not met the standards of conduct which make it
permissible under the BCA for the Company to indemnify the Indemnitee for the
amount claimed, but the burden of proving such defense shall be on the Company.
Neither the failure of the Company (including the Board, independent legal

                                      -10-

<PAGE>   11
counsel or the Shareholders) to have made a determination prior to commencement
of such action that indemnification of the Indemnitee is proper in the
circumstances because the Indemnitee has met the applicable standard of conduct
set forth in the BCA, nor an actual determination by the Company (including the
Board, independent legal counsel or the Shareholders) that the Indemnitee has
not met such applicable standard of conduct, shall be a defense to the action or
create a presumption that the Indemnitee has not met the applicable standard of
conduct.

         (c)  It is the intent of the Company that the Indemnitee not be
required to incur the expenses associated with the enforcement of the
Indemnitee's rights under this Agreement by litigation or other legal action
because the cost and expense thereof would substantially detract from the
benefits intended to be extended to the Indemnitee hereunder. Accordingly, if it
should appear to the Indemnitee that the Company has failed to comply with any
of its obligations under the Agreement or in the event that the Company or any
other person takes any action to declare this Agreement void or unenforceable,
or institutes any action, suit or proceeding designed (or having the effect of
being designed) to deny, or to recover from, the Indemnitee the benefits
intended to be provided to the Indemnitee hereunder, the Company irrevocably
authorizes the Indemnitee from time to time to retain counsel of the
Indemnitee's choice, at the expense of the Company as hereafter provided, to
represent the Indemnitee in connection with the initiation or defense of any
litigation or other legal action, whether by or against the Company or any
director, officer, stockholder or other person affiliated with the Company, in
any jurisdiction. Regardless of the outcome thereof, the Company shall pay and
be solely responsible for any and all costs, charges and expenses, including
without limitation attorneys' and others' fees and

                                      -11-

<PAGE>   12

expenses, reasonably incurred by the Indemnitee (i) as a result of the Company's
failure to perform this Agreement or any provision thereof or (ii) as a result
of the Company or any person contesting the validity or enforceability of this
Agreement or any provision thereof as aforesaid.

         7.   Merger or Consolidation. In the event that the Company shall be a
constituent corporation in a consolidation, merger or other reorganization, the
Company, if it shall not be the surviving, resulting or other corporation
therein, shall require as a condition thereto the surviving, resulting or
acquiring corporation to agree to indemnify the Indemnitee to the full extent
provided in this Agreement. Whether or not the Company is the resulting,
surviving or acquiring corporation in any such transaction, the Indemnitee shall
also stand in the same position under this Agreement with respect to the
resulting, surviving or acquiring corporation as the Indemnitee would have with
respect to the Company if its separate existence had continued.

         8.   Nonexclusivity and Severability.

              (a)  The right to indemnification provided by this Agreement shall
not be exclusive of any other rights to which the Indemnitee may be entitled
under the Articles, By-Laws, the BCA, any other statute, insurance policy,
agreement, vote of shareholders or of directors or otherwise, both as to actions
in the Indemnitee's official capacity and as to actions in another capacity
while holding such office, and shall continue after the Indemnitee has ceased to
be a director, officer, employee or agent and shall inure to the benefit of the
Indemnitee's heirs, executors and administrators.

              (b)  If any provision of this Agreement or the application of any
provision hereof to any person or circumstances is held invalid, unenforceable
or otherwise illegal, the remainder of this Agreement and the application of
such provision to other persons or

                                      -12-

<PAGE>   13

circumstances shall not be affected, and the provision so held to be invalid,
unenforceable or otherwise illegal shall be reformed to the extent (and only to
the extent) necessary to make it enforceable, valid and legal.

         9.   Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Michigan, without giving effect to
the principles of conflict of laws thereof.

         10.  Modification: Survival. This Agreement contains the entire
agreement of the parties relating to the subject matter hereof. This Agreement
may be modified only by an instrument in writing signed by both parties hereto.
The provisions of this Agreement shall survive the death, disability, or
incapacity of the Indemnitee or the termination of the Indemnitee's service as a
an officer or director of the Company and shall inure to the benefit of the
Indemnitee's heirs, executors and administrators.

         11.  Certain Terms. For purposes of this Agreement, references to
"other enterprises" shall include employee benefit plans; references to "fines"
shall include any excise taxes assessed on Indemnitee with respect to any
employee benefit plan; and references to "serving at the request of the Company"
shall include any service as a director, officer, employee or agent of the
Company which imposes duties on, or involves services by, the Indemnitee with
respect to an employee benefit plan, its participants or beneficiaries;
references to the masculine shall include the feminine and vice versa;
references to the singular shall include the plural and vice versa; and if the
Indemnitee acted in good faith and in a manner the Indemnitee reasonably
believed to be in the interest of the participants and beneficiaries of an
employee benefit plan the Indemnitee shall

                                      -13-

<PAGE>   14

be deemed to have acted in a manner "not opposed to the best interests of the
"Company" as referred to herein.

         IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first above written.

                           THE DETROIT EDISON COMPANY

                                 --------------------------------------
                           By:   Susan M. Beale
                                 Vice President and Corporate Secretary

                           INDEMNITEE

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

                                      -14-

<PAGE>   15

                                                                       EXHIBIT 1

                           INDEMNIFICATION STATEMENT

STATE OF MICHIGAN        )
                         )SS
COUNTY OF________________)

         I, _____________________________, being first duly sworn, do depose and
say as follows:

         1.   This Indemnification Statement is submitted pursuant to the
Indemnification Agreement, dated as of ___________, ______, between The Detroit
Edison Company, a Michigan corporation (the "Company"), and the undersigned.

         2.   I am requesting indemnification against charges, costs, expenses
(including attorneys' and others' fees and expenses), judgments, fines and
amounts paid in settlement, all of which (collectively, "Liabilities") have been
or will be incurred by me in connection with an actual or threatened action,
suit, proceeding or claim to which I am a party or am threatened to be made a
party.

         3.   With respect to all matters related to any such action, suit,
proceeding or claim, I am entitled to be indemnified as herein contemplated
pursuant to the aforesaid Agreement.

         4.   Without limiting any other rights which I have or may have, I am
requesting indemnification against Liabilities which have arisen or may arise
out of

                                               _________________________________

         Subscribed and sworn to before me, a Notary Public in and for said
County and State, this ___ day of __________, 19___.

                                                    ____________________________

[Seal]
         My commission expires the ____ day of _______________________, 19___.

                                      -15-

<PAGE>   16

                                                                       EXHIBIT 2

                                  UNDERTAKING

STATE OF MICHIGAN        )
                         )SS
COUNTY OF________________)

         I, _____________________, being first duly sworn do depose and say as
follows:

         1.   This Undertaking is submitted pursuant to the Indemnification
Agreement (the "Agreement"), dated as of ___________, ______, between The
Detroit Edison Company, a Michigan corporation (the "Company"), and the
undersigned.

         2.   I am requesting advancement of certain costs, charges and expenses
which I have incurred or will incur in defending an actual or pending civil or
criminal action, suit, proceeding or claim.

         3.   I affirm my good faith belief that I meet the applicable standard
of conduct set forth in Section 2(a), 2(b) or 3(a) of the Agreement.

         4.   I hereby undertake to repay this advancement of expenses if it
shall ultimately be determined that I did not meet the applicable standard of
conduct or am not entitled to be indemnified by the Company under the aforesaid
Agreement or otherwise.

         5.   My undertaking to repay is my unlimited general obligation.

         6.   The costs, charges and expenses for which advancement is requested
are, in general, all expenses related to _______________________________.

                                               _________________________________

         Subscribed and sworn to before me, a Notary Public in and for said
County and State, this ___ day of __________, 19___.

[Seal]

                                                    ____________________________

         My commission expires the ____ day of _______________________, 19___.

                                      -16-

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