Document:

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                                                                  Exhibit 10.109

                                    POWERGEN
                            SHORT TERM INCENTIVE PLAN
                            EFFECTIVE JANUARY 1, 2001

                      ARTICLE 1. ESTABLISHMENT AND PURPOSE

1.1.     ESTABLISHMENT OF THE PLAN.

Powergen plc (hereinafter referred to as the "Parent"), an English public
limited company, hereby establishes an annual incentive compensation plan to be
known as the "Short Term Incentive Plan" (hereinafter referred to as the "Plan")
as set forth in this document. The Plan permits the awarding of annual cash
bonuses to Key Employees of LG&E Energy Corp. (hereinafter referred to as the
"Company") and its Subsidiaries, based on the achievement of preestablished
performance goals.

With approval by the Board of Directors of the Parent, the Plan shall become
effective as of January 1, 2001. The Plan shall remain in effect until
terminated by the Board of Directors.

1.2.     PURPOSE.

The purpose of the Plan is to provide Key Employees of the Company and its
Subsidiaries with a meaningful annual incentive opportunity geared toward the
achievement of specific corporate, business unit, line of business, and/or
individual goals.

                             ARTICLE 2. DEFINITIONS

2.1.     DEFINITIONS.

Whenever used in the Plan, the following terms shall have the meanings set forth
below and, when the defined meaning is intended, the term is capitalized:

         (a)      "Beneficial Owner" shall have the meaning ascribed to such
                  term in Rule 13d-3 of the General Rules and Regulations under
                  the Exchange Act.

         (b)      "Board" or "Board of Directors" means the Board of Directors
                  of the Parent.

         (c)      "Cause" shall mean the occurrence of any one of the following:

                  (i)      The willful and continued failure by a Participant to
                           substantially perform his/her duties (other than any
                           such failure resulting from the Participant's
                           disability), after a written demand for substantial
                           performance is delivered to the Participant that
                           specifically identifies the manner in which the
                           Company or any of its Subsidiaries, as the case may
                           be, believes that the Participant has not
                           substantially performed his/her duties, and the
                           Participant has failed to remedy the situation within
                           ten (10) business days of receiving such notice; or

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                  (ii)     the Participant's conviction for committing a felony
                           in connection with the employment relationship; or

                  (iii)    the willful engaging by the Participant in gross
                           misconduct materially and demonstrably injurious to
                           the Company or any of its Subsidiaries. However, no
                           act, or failure to act, on the Participant's part
                           shall be considered "willful" unless done, or omitted
                           to be done, by the Participant not in good faith and
                           without reasonable belief that his/her action or
                           omission was in the best interest of the Company or
                           any of its Subsidiaries.

         (d)      "Change in Control" shall be deemed to have occurred if the
                  conditions set forth in any one of the following paragraphs
                  shall have been satisfied:

                  (i)      An acquisition (other than directly from Parent) of
                           any securities of Parent entitled generally to vote
                           on the election of directors (the "Voting Stock") by
                           any "Person" (as the term person is used for purposes
                           of Section 13(d) or 14(d) of the Exchange Act
                           immediately after which such Person has "Beneficial
                           Ownership" (within the meaning of Rule 13d-3
                           promulgated under the Exchange Act) of fifteen
                           percent (15%) or more of the combined voting power of
                           Parent's then outstanding Voting Stock; PROVIDED,
                           HOWEVER, in determining whether a Change in Control
                           has occurred, Voting Stock which is acquired in a
                           "Non-Control Acquisition" (as hereinafter defined)
                           shall not constitute an acquisition which would cause
                           a Change in Control. A "Non-Control Acquisition"
                           shall mean an acquisition by (1) an employee benefit
                           plan (or a trust forming a part thereof) maintained
                           by (a) Parent or (b) any corporation or other Person
                           of which a majority of its voting power or its equity
                           securities or equity interest is owned directly and
                           indirectly by Parent (a "Parent Subsidiary") or (2)
                           Parent or any Parent Subsidiary.

                  (ii)     the individuals who, as of the effective date of the
                           Plan, are members of the Board (the "Incumbent
                           Board"), cease for any reason to constitute at least
                           two-thirds of the Board; provided, however, that if
                           the election, or nomination for election by Parent's
                           stockholders, of any new director was approved by a
                           vote of at least two-thirds of the Incumbent Board,
                           such new director shall, for purposes of the
                           Agreement, be considered as a member of the Incumbent
                           Board; or

                  (iii)    Approval by stockholders of Parent of:

                           (a)      A merger, consolidation or reorganization
                                    involving Parent; unless

                           (1)      the stockholders of Parent immediately
                                    before such merger, consolidation or
                                    reorganization, own, directly or indirectly
                                    immediately following such merger,
                                    consolidation or reorganization, at least
                                    seventy-five percent (75%) of the combined

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                                    voting power of the outstanding voting
                                    securities of the corporation resulting from
                                    such merger or consolidation or
                                    reorganization (the "Surviving Corporation")
                                    in substantially the same proportion to each
                                    other as their ownership of the Voting
                                    Securities immediately before such merger,
                                    consolidation or reorganization, and

                           (2)      the individuals who were members of the
                                    Incumbent Board immediately prior to the
                                    execution of the agreement providing for
                                    such merger, consolidation or reorganization
                                    constitute at least two-thirds of the
                                    members of the board of directors of the
                                    Surviving Corporation;

                  (b)      A complete liquidation or dissolution of Parent or
                           the Company ; unless, in the case of the Company,
                           Parent continues to own directly or indirectly all or
                           substantially all of the Company's assets;

                  (c)      An agreement for the sale or other disposition of all
                           or substantially all of the assets of Parent or the
                           Company to any Person (other than a transfer to a
                           Parent Subsidiary);

                  (d)      A merger or other combination involving the Company
                           as a result of which Parent ceases to beneficially
                           own more than 50% of the outstanding Voting Stock of
                           the successor to the Company, unless Parent or a
                           Parent Subsidiary continues to own directly or
                           indirectly all or substantially all of the Company's
                           assets; or

                  (e)      Any Person acquires Beneficial Ownership of a greater
                           percentage of the Voting Stock of the Company than
                           the percentage of such Voting Stock then held,
                           directly or indirectly, by Parent or a Parent
                           Subsidiary.

         Notwithstanding the foregoing clauses (i), (ii), and (iii), a Change in
         Control shall not be deemed to occur solely because any Person (the
         "Subject Person") acquired Beneficial Ownership of more than the
         permitted amount of the outstanding Voting Stock as a result of the
         acquisition of Voting Stock by Parent which, by reducing the number of
         Voting Stock outstanding, increases the proportional number of shares
         beneficially owned by the Subject Person, provided that if a Change in
         Control would occur (but for the operation of this sentence) as a
         result of the acquisition of Voting Stock by Parent, and after such
         share acquisition by Parent, the Subject Person or entity becomes the
         Beneficial Owner of any additional Voting Stock which increases the
         percentage of the then outstanding Voting Stock Beneficially Owned by
         the Subject Person, then a Change in Control shall occur.

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         (e)      "Code" means the Internal Revenue Code of 1986, as amended
                  from time to time.

         (f)      "Committee" means the Remuneration Committee of the Board of
                  the Parent.

         (g)      "Company" means LG&E Energy Corp., a Kentucky corporation, and
                  any successor thereto.

         (h)      "Company Performance Goals" shall have the meaning ascribed to
                  it by Section 6.1 hereof.

         (i)      "Company Performance Award" means an award established
                  pursuant to Article 6 hereof. Such Company Performance Awards
                  shall be expressed as a percentage of the Participant's base
                  salary.

         (j)      "Earned Award" means the Earned Individual Award, if any, and
                  the Earned Company Award, if any, for a Participant for the
                  applicable Incentive Period.

         (k)      "Earned Company Award" means the actual award earned under a
                  Participant's Company Performance Award during an Incentive
                  Period as determined by the Committee at the end of the
                  Incentive Period (pursuant to Section 6.3 hereof).

         (l)      "Earned Individual Award" means the actual award earned under
                  a Participant's Individual Performance Award during an
                  Incentive Period as determined by the Committee at the end of
                  the Incentive Period (pursuant to Section 5.4 hereof).

         (m)      "Exchange Act" means the Securities Exchange Act of 1934, as
                  amended from time to time.

         (n)      "Incentive Period" shall mean the period with respect to which
                  a Participant is eligible to earn an Earned Award. Subject to
                  the discretion of the Committee to select shorter or longer
                  Incentive Periods, the Incentive Period shall be the Plan
                  Year.

         (o)      "Individual Performance Award" means an award established
                  pursuant to Article 5 hereof. Such Individual Performance
                  Award shall be expressed as a percentage of the Participant's
                  actual base salary.

         (p)      "Key Employee" means the Chief Executive Officer of the
                  Company and each employee of the Company or any of its
                  Subsidiaries who, in the opinion of the Chief Executive
                  Officer of the Company, is in a position to significantly
                  contribute to the growth and profitability of the Company or
                  any of its Subsidiaries (see Article 4 herein).

         (q)      "Parent" means Powergen plc, an English public limited
                  company, and any successor thereto.

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         (r)      "Participant" means a Key Employee who is nominated for
                  participation by the Chief Executive Officer and then is
                  selected by the Committee to participate in the Plan (see
                  Article 4 herein).

         (s)      "Person" shall have the meaning ascribed to such term in
                  Section 3(a)(9) of the Exchange Act and used in Section 13(d)
                  and 14(d) thereof, including a "group" as defined in Section
                  13(d).

         (t)      "Plan Year" means the Company's fiscal year commencing January
                  1 and ending December 31.

         (u)      "Subsidiary" shall mean any corporation of which more than 50%
                  (by number of votes) of the Voting Stock at the time
                  outstanding is owned, directly or indirectly, by the Parent.

         (v)      "Target Performance Award" means the Individual Performance
                  Award, if any, and the Company Performance Award, if any, for
                  a Participant for the applicable Incentive Period.

         (w)      "Voting Securities" shall mean securities of any class or
                  classes of stock of a corporation, the holders of which are
                  ordinarily, in the absence of contingencies, entitled to elect
                  a majority of the corporate directors.

2.2.     GENDER AND NUMBER.

Except where otherwise indicated by the context, any masculine term used herein
also shall include the feminine; the plural shall include the singular and the
singular shall include the plural.

2.3.     SEVERABILITY.

In the event any provision of the Plan shall be held legally invalid for any
reason, the illegality or invalidity shall not affect the remaining parts of the
Plan, and the Plan shall be construed and enforced as if the illegal or invalid
provision had not been included.

                            ARTICLE 3. ADMINISTRATION

3.1.     THE COMMITTEE.

This Plan shall be administered by the Committee or such delegated as permitted
by law and Article 3.3 delegated by the Committee to administer the Plan in
accordance with rules that it may establish from time to time, that are not
inconsistent with the provisions of this Plan.

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3.2.     AUTHORITY OF THE COMMITTEE.

Subject to the provisions of the Plan, the Committee shall have full power to
construe and interpret the Plan and to establish, amend or waive rules and
regulations for its administration. The determination of the Committee as to any
disputed question arising under this Plan, including questions of construction
and interpretation shall be final, binding, and conclusive upon all persons and
shall not be reviewable.

3.3.     DELEGATION OF CERTAIN RESPONSIBILITIES.

The Committee may, in its sole discretion, delegate to an officer or officers of
the Company the administration of the Plan under this Article 3; provided,
however, that no such delegation by the Committee shall be made with respect to
the administration of the Plan as it affects officers of the Company or its
Subsidiaries, and provided further that the Committee may not delegate its
authority to correct errors, omissions or inconsistencies in the Plan. All
authority delegated by the Committee under this Section 3.3 shall be exercised
in accordance with the provisions of the Plan and any guidelines for the
exercise of such authority that may from time to time be established by the
Committee.

3.4.     PROCEDURES OF THE COMMITTEE.

All determinations of the Committee shall be made by not less than a majority of
its members present at the meeting (in person or otherwise) at which a quorum is
present. A majority of the entire Committee shall constitute a quorum for the
transaction of business. Any action required or permitted to be taken at a
meeting of the Committee may be taken without a meeting if a unanimous written
consent, which sets forth the action, is signed by each member of the Committee
and filed with the minutes for proceedings of the Committee.

3.5.     INDEMNIFICATION.

Service on the Committee shall constitute service as a director of the Company
so that members of the Committee shall be entitled to indemnification,
limitation of liability and reimbursement of expenses with respect to their
services as members of the Committee to the same extent that they are entitled
under the law for their services as directors of the Company.

                    ARTICLE 4. ELIGIBILITY AND PARTICIPATION

4.1.     ELIGIBILITY.

Eligibility for participation in the Plan shall be limited to those Key
Employees who are nominated for participation by the Chief Executive Officer of
the Company and then selected by the Committee to participate in the Plan.

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4.2.     PARTICIPATION.

Participation in the Plan shall be determined annually based upon nomination by
the Chief Executive Officer and selection by the Committee. Specific criteria
for participation shall be determined by the Committee prior to the beginning of
each Incentive Period. Key Employees selected for participation shall be
notified in writing of their selection, and of their performance goals and
related Target Performance Awards, as soon after approval as is practicable.

4.3.     PARTIAL INCENTIVE PERIOD PARTICIPATION.

Subject to Article 6 herein, the Committee may, upon recommendation of the Chief
Executive Officer, allow an individual who becomes eligible after the beginning
of an Incentive Period to participate in the Plan for that period. In such case,
the Participant's Earned Award normally shall be prorated based on the number of
full months of participation during such Incentive Period. However, subject to
Article 6 herein, the Chief Executive Officer, subject to Committee approval,
may authorize an unreduced Earned Award.

4.4.     TERMINATION OF APPROVAL.

In its sole discretion, the Committee may withdraw its approval for
participation in the Plan with respect to an Incentive Period for a Participant
at any time during such Incentive Period; provided, however that, such
withdrawal must occur before the end of such Incentive Period and provided
further that, in the event a Change in Control occurs during an Incentive
Period, the Committee may not thereafter withdraw its approval for a Participant
during such Incentive Period. In the event of such withdrawal, the employee
concerned shall cease to be a Participant as of the date designated by the
Committee, and the employee shall not be entitled to any part of an Earned Award
for the Incentive Period in which such withdrawal occurs. Such employee shall be
notified of such withdrawal in writing as soon as practicable following such
action.

                    ARTICLE 5. INDIVIDUAL PERFORMANCE AWARDS

5.1.     AWARD OPPORTUNITIES.

At the beginning of each Incentive Period, the Committee or its delegates shall
establish Individual Performance Award levels for each Participant who is an
officer of the Company and who is to be granted an Individual Performance Award.
The established levels may vary in relation to the responsibility level of the
Participant. In the event a Participant changes job levels during the Incentive
Period, the Individual Performance Award may be adjusted at the discretion of
the Committee or its delegates, as appropriate, to reflect the amount of time at
each job level. Notwithstanding any provision in this Plan to the contrary,
Individual Performance Awards shall not be dependent in any manner on, and shall
be established independently of and in addition to, the establishment of any
Company Performance Awards or the payout of any Earned Company Awards pursuant
to Article 6 herein.

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5.2.     INDIVIDUAL PERFORMANCE GOALS.

At the beginning of each Incentive Period, the Committee or its delegates shall
establish individual performance goals for each Participant who is granted an
Individual Performance Award. The level of achievement of the individual
performance goals by a Participant at the end of the Incentive Period, as
determined pursuant to Section 5.4 below, will determine such Participant's
Earned Individual Award, which may range from 0% to 175% of such Participant's
Individual Performance Award.

5.3.     ADJUSTMENT OF INDIVIDUAL PERFORMANCE GOALS.

The Committee or its delegates shall have the right to adjust the individual
performance goals (either up or down) during the Incentive Period if they
determine that external changes or other unanticipated conditions have
materially affected the fairness of the goals and unduly influenced a
Participant's ability to meet them.

5.4.     EARNED INDIVIDUAL AWARD DETERMINATION.

At the end of each Incentive Period, the Chief Executive Officer shall review
the performance of each Participant who received an Individual Performance
Award. Based on the Chief Executive Officer's determination as to a
Participant's level of achievement of his or her individual performance goals,
the Chief Executive Officer shall make a recommendation to the Committee as to
the Earned Individual Award to be received by such Participant. Notwithstanding
the foregoing, however, all reviews and determinations with respect to the
performance of the Chief Executive Officer , and the payment of any Earned
Individual Award to the Chief Executive Officer shall be made by the Chairman of
the Parent. The payment of all Earned Individual Awards is subject to approval
by the Committee. The payment of an Earned Individual Award to a Participant
shall not be contingent in any manner upon the attainment of, or failure to
attain the Company Performance Goals for the Company Performance Awards granted
to such Participant under Article 6.

5.5.     MAXIMUM PAYABLE/AGGREGATE AWARD CAP.

The maximum amount payable to a Participant pursuant to this Article 5 for
performance by the Participant during any fiscal year of the Company shall be
determined by the Committee or its delegates. The Committee also may establish
guidelines governing the maximum Earned Individual Awards that may be earned by
all Participants in the aggregate, in each Incentive Period. These guidelines
may be expressed as a percentage of a financial measure, or such other measure
as the Committee shall from time to time determine.

                            ARTICLE 6.  COMPANY PERFORMANCE AWARDS

In addition to any Individual Performance Awards granted under Article 5,
Company Performance Awards based solely on Company performance may be
established under this Article 6 for Participants.

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6.1.     AWARD OPPORTUNITIES.

On or before the 90th day of each Incentive Period and in any event before 25%
or more of the Incentive Period has elapsed, the Committee or its delegates upon
recommendation by the Chief Executive Officer shall establish in writing for
each Participant for whom a Company Performance Award is to be granted under
this Article 6, the Company Performance Award and specific objective performance
goals for the Incentive Period, which goals shall meet the requirements of
Section 6.2 herein (such goals are hereinafter referred to as "Company
Performance Goals"). The extent, if any, to which an Earned Company Award will
be payable to a Participant will be based solely upon the degree of achievement
of such pre-established Company Performance Goals over the specified Incentive
Period; provided, however, that the Committee or its delegates may, in its sole
discretion, reduce the amount which would otherwise be payable with respect to
an Incentive Period. Payment of an Earned Company Award to a Participant shall
consist of a cash award from the Company to be based upon a percentage (which
may exceed 100%) of the Participant's Company Performance Award.

6.2  COMPANY PERFORMANCE GOALS.

The Company Performance Goals established by the Committee or its delegates
pursuant to Section 6.1 will be based on one or more of the following: total
shareholder return, return on equity, return on capital, earnings per share,
market share, stock price, sales, costs, net income, cash flow, retained
earnings, profit before tax, results of customer satisfaction surveys, aggregate
product price and other product price measures, safety record, service
reliability, demand-side management (including conservation and load
management), operating and maintenance cost management, energy production
availability performance measures, or any other measures determined by the
Committee or its delegates. At the time of establishing a Company Performance
Goal, the Committee shall specify the manner in which the Company Performance
Goal shall be calculated. In so doing, the Committee may exclude the impact of
certain specified events from the calculation of the Company Performance Goal.
For example, if the Company Performance Goal were earnings per share, the
Committee could, at the time this Company Performance Goal was established,
specify that earnings per share are to be calculated without regard to any
subsequent change in accounting standards required by the Financial Accounting
Standards Board. Company Performance Goals also may be based on the attainment
of specified levels of performance of the Company and/or any of its Subsidiaries
under one or more of the measures described above relative to the performance of
other corporations. As part of the establishment of Company Performance Goals
for an Incentive Period, the Committee shall also establish a minimum level of
achievement of the Company Performance Goals that must be met for a Participant
to receive any portion of his Company Performance Award.

6.3        PAYMENT OF AN EARNED COMPANY AWARD.

At the time the Company Performance Award for a Participant is established, the
Committee shall prescribe a formula to determine the percentage (which may
exceed 100%) of the Company Performance Award which may be payable to the
Participant based upon the degree of attainment of the Company Performance Goals
during the Incentive Period. If the minimum level of achievement of Company
Performance Goals established by the Committee for a

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Participant for an Incentive Period is not met, no payment of an Earned Company
Award will be made to the Participant for that Incentive Period. To the extent
that the minimum level of achievement of Company Performance Goals is satisfied
or surpassed for a Participant for an Incentive Period, and upon written
certification by the Committee that the Company Performance Goals have been
satisfied to a particular extent and that any other material terms and
conditions of the Company Performance Awards have been satisfied, payment of an
Earned Company Award shall be made to the Participant for that Incentive Period
in accordance with the prescribed formula unless the Committee determines, in
its sole discretion, to reduce the payment to be made.

6.4        MAXIMUM PAYABLE.

The maximum amount payable to a Participant pursuant to this Article 6 for
performance by the Participant during any fiscal year of the Company shall be
determined by the Committee or its delegates.

6.5        COMMITTEE DISCRETION.

Notwithstanding Article 5 herein, the Committee shall not have discretion to
modify the terms of Company Performance Awards, except as specifically set forth
in this Article 6.

                 ARTICLE 7. FORM AND TIMING OF PAYMENT OF AWARDS

Subject to Article 6 herein, as soon as practicable following the applicable
Incentive Period, Earned Award payments, if any, for such Incentive Period shall
be paid in cash. Subject to Article 6 herein, deferral of payments may be
provided for under rules to be determined by the Committee.

                      ARTICLE 8. TERMINATION OF EMPLOYMENT

8.1.     TERMINATION OF EMPLOYMENT DUE TO DEATH, DISABILITY, OR RETIREMENT.

In the event a Participant's employment is terminated by reason of death, total
and permanent disability (as determined by the Committee), or retirement (as
determined by the Committee), the Earned Award, determined in accordance with
Section 5.4 and Section 6.3 herein, shall be reduced to reflect participation
prior to termination. This reduction shall be determined by multiplying said
Earned Award by a fraction; the numerator of which is the months of
participation through the date of termination rounded up to whole months and the
denominator of which is the number of whole months in the applicable Incentive
Period. The Earned Award thus determined shall be paid as soon as practicable
following the release of the Company's audited financial statements pertaining
to the Plan Year ending coincident with or immediately after the applicable
Incentive Period.

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8.2.   TERMINATION OF EMPLOYMENT FOR OTHER REASONS.

In the event a Participant's employment is terminated for any reason other than
death, total and permanent disability, or retirement (of which the Committee
shall be the sole judge), all of the Participant's rights to an Earned Award for
the Incentive Period then in progress shall be forfeited. However, except in the
event of a termination of employment for Cause, the Committee, in its sole
discretion, may pay a prorated award for the portion of that Incentive Period
that the Participant was employed by the Company or any of its Subsidiaries,
computed as determined by the Committee.

                        ARTICLE 9. RIGHTS OF PARTICIPANTS

9.1.     EMPLOYMENT.

Nothing in this Plan shall interfere with or limit in any way the right of the
Company or any of its Subsidiaries to terminate any Participant's employment at
any time, nor confer upon any Participant any right to continue in the employ of
the Company or any of its Subsidiaries.

9.2.     PARTICIPATION.

No Participant or other employee shall at any time have a right to be selected
for participation in the Plan for any Incentive Period, despite having been
selected for participation in a previous Incentive Period. Except as otherwise
provided in Article 8 or Article 11 herein and subject to Section 4.4 herein, a
Participant shall not have any right to an Earned Award for an Incentive Period,
unless the Participant is an employee of the Company at the end of such
Incentive Period.

9.3.     NONTRANSFERABILITY.

No right or interest of any Participant in this Plan shall be assignable or
transferable, or subject to any lien, directly, by operation of law, or
otherwise, including execution, levy, garnishment, attachment, pledge, and
bankruptcy.

9.4.     NO IMPLIED RIGHTS; RIGHTS ON TERMINATION OF SERVICE.

Neither the establishment of the Plan nor any amendment thereof shall be
construed as giving any Participant, beneficiary, or any other person any legal
or equitable right unless such right shall be specifically provided for in the
Plan or conferred by specific action of the Committee in accordance with the
terms and provisions of the Plan. Except as expressly provided in this Plan,
neither the Company nor any of its Subsidiaries shall be required or be liable
to make any payment under the Plan.

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9.5.     NO RIGHT TO COMPANY ASSETS.

Neither the Participant nor any other person shall acquire, by reason of the
Plan, any right in or title to any assets, funds or property of the Parent,
Company or any of its Subsidiaries whatsoever including, without limiting the
generality of the foregoing, any specific funds, assets, or other property which
the Parent, Company or any of its Subsidiaries, in its sole discretion, may set
aside in anticipation of a liability hereunder. Any benefits which become
payable hereunder shall be paid from the general assets of the Parent, Company
or the applicable Subsidiary. The Participant shall have only a contractual
right to the amounts, if any, payable hereunder unsecured by any asset of the
Parent, Company or any of its Subsidiaries. Nothing contained in the Plan
constitutes a guarantee by the Parent, Company or any of its Subsidiaries that
the assets of the Company or the applicable Subsidiary shall be sufficient to
pay any benefit to any person.

                       ARTICLE 10. BENEFICIARY DESIGNATION

Each Participant under the Plan may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively and who may include
a trustee under a will or living trust) to whom any benefit under the Plan is to
be paid in case of his death before he receives any or all of such benefit. Each
designation will revoke all prior designations by the same Participant, shall be
in a form prescribed by the Committee, and will be effective only when filed by
the Participant in writing with the Committee during his lifetime. In the
absence of any such designation, or if all designated beneficiaries predecease
the Participant, benefits remaining unpaid at the Participant's death shall be
paid to the Participant's estate.

                          ARTICLE 11. CHANGE IN CONTROL

Notwithstanding any other provisions of the Plan, in the event a Participant's
employment with the Company or any of its Subsidiaries is terminated by the
Company for any reason other than for Cause, within twenty-four (24) months
after a Change in Control of the Company or any of its Subsidiaries, all awards
previously deferred (with earnings) shall be paid to the Participant within ten
(10) business days of the termination; along with the Target Performance Award
established for the Participant for the Incentive Period in progress at the time
of the employment termination, prorated for the number of days in the Incentive
Period in which the Participant was employed by the Company or any of its
Subsidiaries, up to and including the date of termination.

In the event a Participant's employment with the Company or any of its
Subsidiaries is terminated for Cause, no Earned Award will be paid for the
Incentive Period in progress at the time of the employment termination.

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                             ARTICLE 12. AMENDMENTS

The Committee, in its absolute discretion, without notice, at any time and from
time to time, may modify or amend in whole or in part, any or all of the
provisions of this Plan, or suspend or terminate it entirely; provided, that no
such modification, amendment, suspension, or termination after an Incentive
Period, may without the consent of a Participant (or his beneficiary in the case
of the death of the Participant) reduce the right of a Participant (or his
beneficiary, as the case may be) to a payment or distribution hereunder to which
he is entitled for that Incentive Period.

                         ARTICLE 13. REQUIREMENTS OF LAW

13.1.    GOVERNING LAW.

The Plan, and all agreements hereunder shall be construed in accordance with and
governed by the laws of England.

13.2.    WITHHOLDING TAXES.

The Company shall have the right to deduct from all payments under this Plan any
taxes required by the law to be withheld with respect to such payments.

                                       13<PAGE>

                                                                  Exhibit 10.110

                           CHANGE-IN-CONTROL AGREEMENT

         THIS AGREEMENT made this DATE, by and between LG&E ENERGY CORP. (the
"Company") and _____________________("Executive").

         WHEREAS, the Board of Directors of the Company (the "Board") recognizes
that the possibility of a Change in Control (as hereinafter defined) exists and
that the occurrence of a Change in Control can result in significant
distractions of its key management personnel because of the uncertainties
inherent in such a situation;

         WHEREAS, the Board has determined that it is essential and in the best
interest of the Company and Powergen, plc (the "Parent") to retain the services
of the Executive in the event of a Change in Control and to ensure his continued
dedication and efforts in such event without undue concern for his personal
financial and employment security; and

         WHEREAS, in order to induce the Executive to remain in the employ of
the Company or a Subsidiary (as hereinafter defined), as the case may be,
particularly in the event of a threat or the occurrence of a Change in Control,
the Company desires to enter into this Agreement with the Executive to provide
the Executive with certain benefits in the event his employment is terminated as
a result of, or in connection with, a Change in Control.

         NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:

         1. TERM OF AGREEMENT. This Agreement shall commence as of the _____ day
of _________________, 2000, and shall continue in effect until SAME MONTH/DAY,
2002, provided, however, that commencing on SAME MONTH/DAY, 2002, and on SAME
MONTH/DAY thereafter, the term of this Agreement shall automatically be extended
for one (1) year unless either the Company or the Executive shall have given
written notice to the other at least ninety (90) days prior thereto that the
term of this Agreement shall not be so extended; and provided, further, however,
that notwithstanding any such notice by the Company not to extend, the term of
this Agreement shall not expire prior to the expiration of twenty-four (24)
months after any Change in Control which occurs while this Agreement is in
effect.

         2.       DEFINITIONS.

                  2.1 BASE AMOUNT; BONUS AMOUNT. For purposes of this Agreement,
         "Base Amount" shall mean the greater of the Executive's annual base
         salary from the Company and its Subsidiaries (a) at the rate in effect
         on the Termination Date (as hereinafter defined) or (b) at the highest
         rate in effect at any time during the ninety (90) day period prior to
         the Change in Control, and shall include all amounts of base salary
         that are deferred under any qualified and non-qualified employee
         benefits plans of the Company or any Subsidiary or under any other
         agreement or arrangement. For purposes of this Agreement; "Bonus
         Amount" shall mean the greater of (a) the most recent annual bonus paid
         or payable to the Executive, (b) the annual bonus paid or payable to
         the Executive under the Short Term Incentive Plan for the full fiscal
         year ended prior to the fiscal year during which a Change in Control
         occurred or (c) the Executive's target award under the Short Term
         Incentive Plan for the full fiscal year ended prior to the fiscal year
         during which a Change in Control occurred.

<PAGE>

                  2.2 CAUSE. For purposes of this Agreement, a termination for
         "Cause" is a termination evidenced by a resolution adopted in good
         faith by at least seventy-five percent (75%) of the Board that (i)
         there has been repeated gross negligence by the Executive in performing
         the reasonably assigned duties on behalf of an Employer required by and
         in accordance with his employment by such Employer, or (ii) the
         Executive has committed a felony in the course of performing those
         duties. Notwithstanding anything contained in this Agreement to the
         contrary, no failure to perform by the Executive after a Notice of
         Termination (as hereinafter defined) is given by the Executive shall
         constitute Cause for purposes of this Agreement. No act, or failure to
         act, on Executive's part shall be deemed to be "repeated" unless the
         Executive shall have received a written notice from seventy-five
         percent (75%) of the Board setting forth in detail the particulars of
         the act, or the failure to act, which the Company contends would
         constitute Cause when repeated and Executive then repeats such act or
         failure to act.

                  2.3 CHANGE IN CONTROL.

For purposes of this Agreement, a "Change in Control" shall mean the occurrence
during the term of this Agreement of any of the following events:

                  (a) An acquisition (other than directly from Parent) of any
         securities of Parent entitled generally to vote on the election of
         directors (the "Voting Securities") by any "Person" (as the term person
         is used for purposes of Section 13(d) or 14(d) of the Securities
         Exchange Act of 1934, as amended (the "1934 Act")) immediately after
         which such Person has "Beneficial Ownership" (within the meaning of
         Rule 13d-3 promulgated under the 1934 Act) of fifteen percent (15%) or
         more of the combined voting power of Parent's then outstanding Voting
         Securities; PROVIDED, HOWEVER, in determining whether a Change in
         Control has occurred, Voting Securities which are acquired in a
         "Non-Control Acquisition" (as hereinafter defined) shall not constitute
         an acquisition which would cause a Change in Control. A "Non-Control
         Acquisition" shall mean an acquisition by (1) an employee benefit plan
         (or a trust forming a part thereof) maintained by (a) Parent or (b) any
         corporation or other Person of which a majority of its voting power or
         its equity securities or equity interest is owned directly and
         indirectly by Parent (a "Subsidiary") or (2) Parent or any Subsidiary.

                  (b) The individuals who, as of the date this Agreement was
         approved by the Board, are members of the Board (the "Incumbent
         Board"), cease for any reason to constitute at least two-thirds of the
         Board; provided, however, that if the election, or nomination for
         election by Parent's stockholders, of any new director was approved by
         a vote of at least two-thirds of the Incumbent Board, such new director
         shall, for purposes of the Agreement, be considered as a member of the
         Incumbent Board; or

                  (c) Approval by stockholders of Parent of:

                  (1)      A merger, consolidation or reorganization involving
                  Parent; unless

<PAGE>

                           (i) the stockholders of Parent immediately before
                  such merger, consolidation or reorganization, own, directly or
                  indirectly immediately following such merger, consolidation or
                  reorganization, at least seventy-five percent (75%) of the
                  combined voting power of the outstanding voting securities of
                  the corporation resulting from such merger or consolidation or
                  reorganization (the "Surviving Corporation") in substantially
                  the same proportion to each other as their ownership of the
                  Voting Securities immediately before such merger,
                  consolidation or reorganization, and

                           (ii) the individuals who were members of the
                  Incumbent Board immediately prior to the execution of the
                  agreement providing for such merger, consolidation or
                  reorganization constitute at least two-thirds of the members
                  of the board of directors of the Surviving Corporation;

         (2)      A complete liquidation or dissolution of Parent or the
                  Company; unless, in the case of the Company, Parent continues
                  to own directly or indirectly all or substantially all of the
                  Company's assets;

         (3)      An agreement for the sale or other disposition of all or
                  substantially all of the assets of Parent or the Company to
                  any Person (other than a transfer to a Subsidiary);

                  (4) A merger or other combination involving the Company as a
                  result of which Parent ceases to beneficially own more than
                  50% of the outstanding Voting Securities of the successor to
                  the Company, unless Parent continues to own directly or
                  indirectly all or substantially all of the Company's assets;
                  or

                  (5) Any Person acquires Beneficial Ownership of a greater
                  percentage of the Voting Securities of the Company than the
                  percentage of such Voting Securities then held, directly or
                  indirectly, by Parent.

     (d) Notwithstanding the foregoing clauses (a), (b), and (c), a Change in
Control shall not be deemed to occur solely because any Person (the "Subject
Person") acquired Beneficial Ownership of more than the permitted amount of the
outstanding Voting Securities as a result of the acquisition of Voting
Securities by Parent which, by reducing the number of Voting Securities
outstanding, increases the proportional number of shares, provided that if a
Change in Control would occur (but for the operation of this sentence) as a
result of the acquisition of Voting Securities by Parent, and after such share
acquisition by Parent, the Subject Person or entity becomes the Beneficial Owner
of any additional Voting Securities which increases the percentage of the then
outstanding Voting Securities Beneficially Owned by the Subject Person, then a
Change in Control shall occur.

<PAGE>

     (e) Notwithstanding anything contained in this Agreement to the contrary,
if the Executive's employment is terminated during the term of this Agreement
and the Executive reasonably demonstrates that such termination (i) was at the
request of a third party who has indicated an intention or taken steps
reasonably calculated to effect a Change in Control and who effectuates a Change
in Control (a "Third Party") or (ii) otherwise occurred in connection with, or
in anticipation of, a Change in Control which actually occurs, then for all
purposes of this Agreement, the date of a Change in Control with respect to the
Executive shall mean the date immediately prior to the date of such termination
of the Executive's employment.

     2.4 DISABILITY. For purposes of this Agreement, "Disability" shall mean (i)
a physical or mental infirmity which has been determined to be total and
permanent disability under and in accordance with the provisions of the
Company's Long Term Disability Plan for Employees of Louisville Gas and Electric
Company who are not members of a Bargaining Unit or (ii) in the event the
Company does not maintain such plan at the time of the determination of the
Executive's Disability, a physical or mental infirmity which impairs the
Executive's ability to substantially perform his duties with an Employer which
continues for a period of at least one hundred eighty (180) consecutive days.

     2.5 AN EMPLOYER. For the purposes of this Agreement, "an Employer" shall
mean: (i) in the event the Executive is an officer of the Company and not of any
of its Subsidiaries at the time of a Change in Control, the Company; (ii) in the
event the Executive is an officer of one or more Subsidiaries of the Company,
but not of the Company, at the time of a Change in Control, any such Subsidiary;
and (iii) in the event the Executive is an officer of the Company and one or
more Subsidiaries at the time of a Change in Control, any such entity of which
the Executive is an officer at the time of the Change in Control.

     2.6  GOOD REASON.

               (a) For purposes of this Agreement, "Good Reason" shall mean the
         occurrence after a Change in Control of any of the events or conditions
         described in subsections (1) through (8) hereof:

                  (7)      a reduction by the Company in the Executive's Base
                           Salary or annual target bonus opportunity as in
                           effect prior to such reduction or any failure to pay
                           the Executive any compensation or benefits to which
                           the Executive is entitled within thirty days of the
                           applicable due date, provided that the Company may
                           correct such reduction or failure within thirty (30)
                           days of its commission;

                  (8)      Parent or the Company require the Executive to be
                           relocated anywhere in excess of one hundred (100)
                           miles of his present office location, except for
                           required travel on Parent or Company business
                           consistent with his business travel obligations;

                  (3)      a failure by Parent or the Company to maintain plans
                           providing benefits at least as beneficial in the
                           aggregate as those provided by any benefit or
                           compensation plan, retirement or pension plan, stock

<PAGE>

                           option plan, bonus plan, long-term incentive plan,
                           life insurance plan, health and accident plan or
                           disability plan in which the Executive is
                           participating prior the Change in Control, or if the
                           Company or Parent has taken any action which would
                           adversely affect the Executive's participation in or
                           materially reduce the Executive's benefits under any
                           of such plans or deprive him of any material fringe
                           benefit enjoyed by him prior to the Change in
                           Control, or if the Company or Parent has failed to
                           provide him with the number of paid vacation days to
                           which he would be entitled in accordance with the
                           Company's normal vacation policy immediately prior to
                           the Change in Control, as applicable;

                  (4)      Parent or the Company fails to obtain the assumption
                           of the obligations contained in this Agreement by any
                           successor as contemplated in Section 7 hereof;

                  (5)      any purported termination of the Executive's
                           employment by Parent or the Company which is not
                           effected pursuant to a Notice of Termination
                           satisfying the requirements of Section 4 below; and,
                           for purposes of this Agreement, no such purported
                           termination shall be effective;

                  (6)      any material breach by Parent or the Company of any
                           provision of this Agreement;

                  (9)      any purported termination of the Executive's
                           employment for Cause by Parent or the Company which
                           does not comply with the terms of Section 2.2 of this
                           Agreement;

                  (10)     the Company materially reduces, individually or in
                           the aggregate, the Executive's title, job authorities
                           or responsibilities as in effect prior to such
                           reduction; or

               (b) Any event or condition described in this Section 2.6(a)(1)
         through (8) above, which occurs prior to a Change in Control but which
         the Executive reasonably demonstrates (i) was at the request of a
         Third Party, or (ii) otherwise arose in connection with or in
         anticipation of a Change in Control which actually occurs, shall
         constitute Good Reason for purposes of this Agreement notwithstanding
         that it occurred prior to the Change in Control.

               (c) Until the Executive's Disability, the Executive's rights to
         terminate his employment pursuant to this Section 2.6 shall not be
         affected by his incapacity due to physical or mental illness.

         3.       TERMINATION OF EMPLOYMENT.

                  3.1 If, during the term of this Agreement, the Executive's
employment with an Employer shall be terminated within twenty-four (24) months
following a Change in Control, then the Executive shall be entitled to the
following compensation and benefits:

<PAGE>

               (a) If the Executive's employment with an Employer shall be
         terminated (1) by an Employer for Cause or Disability, (2) by reason of
         the Executive's death, or (3) by the Executive other than for Good
         Reason, the Company shall pay the Executive all amounts earned or
         accrued for or on behalf of the Company or any of its Subsidiaries
         through the Termination Date (as hereinafter defined) but not paid as
         of the Termination Date, including (i) base salary, (ii) reimbursement
         for reasonable and necessary expenses incurred by the Executive on
         behalf of the Company or any Subsidiary during the period ending on the
         Termination Date and (iii) vacation pay (collectively, "Accrued
         Compensation").

               (b) If the Executive's employment with an Employer shall be
         terminated for any reason other than as specified in clause (1) or (2)
         of Section 3.1(a) or if the Executive's employment is terminated by the
         Executive for Good Reason, the Executive shall be entitled to the
         following:

                           (i) The Company shall pay the Executive all Accrued
                  Compensation;

                           (ii) For terminations occurring within the first
                  twenty-four months of the Effective Date, the Company shall
                  pay, as a severance amount to the Executive after the
                  Termination Date, an amount equal to the sum of (a) the Base
                  Amount and (b) the Bonus Amount. For terminations occurring
                  after the first twenty-four months of the Effective Date, the
                  Company shall pay, as a severance amount to the Executive
                  after the Termination Date an amount equal to 2.99 times the
                  sum of (a) the Base Amount and (b) the Bonus Amount;

                           (iii) For a number of months equal to the lesser of
                  (a) twenty-four (24) or (b) the number of months remaining
                  until the Executive's 65th birthday (the "Continuation
                  Period"), the Company shall at its expense continue on behalf
                  of the Executive and his dependents and beneficiaries (to the
                  same extent provided to the dependents and beneficiaries prior
                  to the Executive's termination) the life insurance,
                  disability, medical, dental, and hospitalization benefits
                  provided (x) to the Executive by the Company and/or its
                  Subsidiaries at any time within ninety (90) days preceding a
                  Change in Control or at any time thereafter, or (y) to other
                  similarly situated executives who continue in the employ of
                  the Company or its Subsidiaries during the Continuation
                  Period. The coverage and benefits (including deductibles and
                  costs) provided in this Section 3.1(b)(iii) during the
                  Continuation Period shall be no less favorable to the
                  Executive and his dependents and beneficiaries, than the most
                  favorable of such coverages and benefits set forth in clauses
                  (x) and (y) above. The Company's obligation hereunder with
                  respect to the foregoing benefits shall be limited to the
                  extent that the Executive obtains any such benefits pursuant
                  to a subsequent employer's benefit plans, in which case the
                  Company may reduce the coverage of any benefits it is required
                  to provide the Executive hereunder as long as the aggregate
                  coverages and benefits of the combined benefit plans are no
                  less favorable to the Executive than the coverages and
                  benefits required to be provided hereunder. This

<PAGE>

                  Subsection (iii) shall not be interpreted so as to limit any
                  benefits to which the Executive or his dependents may be
                  entitled under any of the Company's or any Subsidiary's
                  employee benefit plans, programs or practices following the
                  Executive's termination of employment, including without
                  limitation, retiree medical and life insurance benefits; and

                           (iv) The Company shall provide to the Executive
                  outplacement services in an amount up to twenty percent
                  (20%) of the Base Amount.

               (c) The amounts provided for in Section 3.1(a) and 3.1(b)(i) and
         (ii) shall be paid in a lump sum within thirty (30) days after the
         Executive's Termination Date.

               (d) The Executive shall not be required to mitigate the amount of
         any payments provided for in this Agreement by seeking other employment
         or otherwise and no such payment shall be offset or reduced by the
         amount of any compensation or benefits provided to the Executive in any
         subsequent employment except as provided in Section 3.1(b)(iii).

               3.2 The provisions of this Agreement, and any payment provided
         for hereunder, shall not reduce or increase any amounts otherwise
         payable, or in any way diminish or enhance the Executive's existing
         rights, or rights which would accrue solely as a result of the passage
         of time, under any benefit plan, incentive plan, or securities plan,
         employment agreement or other contract, plan or arrangement with the
         Company, any Subsidiary or any other party, including, but not limited
         to, those specified in Exhibit A attached hereto, provided, however,
         the Company shall not be required to make duplicative payments of
         Accrued Compensation. A determination of a Change in Control under this
         Agreement is effective only with respect to benefits payable hereunder,
         and is not determinative of a change in control under any benefit plan,
         incentive plan, or securities plan, employment agreement or other
         contract, plan or arrangement with the Company, any Subsidiary or any
         other party.

         4.    NOTICE OF TERMINATION. Any purported termination by an Employer
or by the Executive shall be communicated by written Notice of Termination to
the other. For purposes of this Agreement, a "Notice of Termination" shall mean
a notice which indicates the specific termination provision in this Agreement
relied upon and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive's employment under
the provision so indicated. For purposes of this Agreement, no such purported
termination shall be effective without such Notice of Termination.

         5.    TERMINATION DATE. "Termination Date" shall mean, in the case of
the Executive's death, his date of death and, in all other cases, the date
specified in the Notice of Termination subject to the following:

               (a) If the Executive's employment is terminated by an Employer
         for Cause or due to Disability, the date specified in the Notice of
         Termination shall be at least thirty (30) days from the date the Notice
         of Termination is given to the Executive, provided that, in the case of
         Disability, the Executive shall not have returned to the full-time
         performance of his duties during such period of at least (30) days; and

<PAGE>

               (b) If the Executive's employment is terminated for Good Reason,
         the date specified in the Notice of Termination shall not be more than
         sixty (60) days from the date the Notice of Termination is given to the
         Employer.

         6.    CERTAIN ADDITIONAL PAYMENTS

               (a) Notwithstanding anything in the Agreement to the contrary, in
         the event that a Change in Control occurs and it is determined (as
         hereafter provided) that any payment or distribution by the Company or
         any affiliates to or for the benefit of the Executive, whether paid or
         payable or distributed or distributable pursuant to the terms of this
         Agreement or otherwise pursuant to or by reason of any other agreement,
         policy, plan, program or arrangement, including without limitation any
         stock option, stock appreciation right or similar right, or the lapse
         or termination of any restriction on or the vesting or exercisability
         of any of the foregoing (individually and collectively a "Payment"),
         would be subject to the excise tax imposed by Section 4999 (or any
         successor provision thereto) of the Internal Revenue Code of 1986, as
         amended (the "Code") by reason of being considered "contingent on a
         change in ownership or control" of the Company or the Parent, within
         the meaning of Section 280G of the Code (or any successor provision
         thereto), or to any similar tax imposed by state or local law, or any
         interest or penalties with respect to any such taxes (such taxes,
         together with any such interest and penalties, being hereafter
         collectively referred to as the "Excise Tax"), then the Executive shall
         be entitled to receive an additional payment or payments (individually
         and collectively, a "Gross-Up Payment"). The Gross-Up Payment shall be
         in an amount such that, after payment by the Executive of all taxes
         (including any interest or penalties imposed with respect to such
         taxes), including any Excise Tax imposed upon the Gross-Up Payment, the
         Executive retains an amount of the Gross-Up Payment equal to the Excise
         Tax imposed upon the Payment.

               (b) Subject to the provisions of Section 6(f) hereof, all
         determinations required to be made under this Section 6, including
         whether an Excise Tax is payable by the Executive and the amount of
         such Excise Tax and whether a Gross-Up Payment is required to be paid
         to the Executive and the amount of such Gross-Up Payment, if any, shall
         be made by a nationally recognized accounting firm (the "Accounting
         Firm") selected by the Executive in his sole discretion. The Executive
         shall direct the Accounting Firm to submit its determination and
         detailed supporting calculations to both the Company and the Executive
         within thirty (30) calendar days after the Termination Date, if
         applicable, and any such other time or times as may be requested by the
         Company or the Executive. If the Accounting Firm determines that any
         Excise Tax is payable by the Executive, the Company shall pay or cause
         to be paid the required Gross-Up Payment in cash to the Executive
         within five (5) business days after receipt of such determination and
         calculations with respect to any Payment to the Executive. If the
         Accounting Firm determines that no Excise Tax is payable by the
         Executive, it shall, at the same time as it makes such determination,
         furnish the Company and the Executive an opinion that the Executive has
         substantial authority not to report any Excise Tax on his federal,
         state or local income or other tax return. As a result of the
         uncertainty in the application of Section 4999 of the Code (or any
         successor provision thereto) at the time of any determination by the
         Accounting Firm hereunder, it is possible that Gross-Up Payments which
         will not have been made by the Company should have been made (an
         "Underpayment"), consistent with the calculations required to be made
         hereunder. In the event that the Company exhausts or fails to pursue
         its remedies pursuant to Section 6(f) hereof and the Executive
         thereafter is required to make a payment of any Excise Tax, the

<PAGE>

         Executive shall direct the Accounting Firm to determine the amount of
         the Underpayment that has occurred and to submit its determination and
         detailed supporting calculations to both the Company and the Executive
         as promptly as possible. Any such Underpayment shall be promptly paid
         by the Company in cash to, or for the benefit of, the Executive within
         five (5) business days after receipt of such determination and
         calculations.

               (c) The Company and the Executive shall each provide the
         Accounting Firm access to and copies of any books, records and
         documents in the possession of the Company or the Executive, as the
         case may be, reasonably requested by the Accounting Firm, and otherwise
         cooperative with the Accounting Firm in connection with the preparation
         and issuance of the determinations and calculations contemplated by
         Section 6(b) hereof. Any determination by the Accounting Firm as to the
         amount of the Gross-Up Payment will be binding on the Company and the
         Executive.

               (d) The federal, state, and local income or other tax returns
         filed by the Executive will be prepared and filed on a consistent basis
         with the determination of the Accounting Firm with respect to the
         Excise Tax payable by the Executive. The Executive will make proper
         payment of the amount of any Excise Payment and, at the request of the
         Company, provide to the Company true and correct copies (with any
         amendments) of the Executive's federal income tax return as filed with
         the Internal Revenue Service and corresponding state and local tax
         returns, if relevant, as filed with the applicable taxing authority,
         and such other documents reasonably requested by the Company,
         evidencing such payment. If prior to the filing of the Executive's
         federal income tax return, or corresponding state or local tax return,
         if relevant, the Accounting Firm determines that the amount of the
         Gross-Up Payment should be reduced, the Executive will within five (5)
         business days pay to the Company the amount of such reduction.

               (e) The fees and expenses of the Accounting Firm for its services
         in connection with the determinations and calculations contemplated by
         Section 6(b) hereof shall be borne by the Company. If such fees and
         expenses are initially paid by the Executive, the Company shall
         reimburse the Executive the full amount of such fees and expenses
         within five (5) business days after receipt from the Executive of a
         statement therefor and reasonable evidence of his payment thereof.

               (f) The Executive shall notify the Company in writing of any
         claim by the Internal Revenue Service or any other taxing authority
         that, if successful, would require the payment by the Company of a
         Gross-Up Payment. Such notification shall be given as promptly as
         practicable but no later than ten (10) business days after the
         Executive actually receives notice of such claim and the Executive
         shall further apprise the Company of the nature of such claim and the
         date on which such claim is requested to be paid (in each case, to the
         extent known by the Executive). The Executive shall not pay such claim
         prior to the earlier of (i) the expiration of the thirty (30)
         calendar-day period following the date on which he gives such notice to
         the Company and (ii) the date that any payment of amount with respect
         to such claim is due. If the Company notifies the Executive in writing
         prior to the expiration of such period that it desires to contest such
         claim, the Executive shall:

                  1.       provide the Company with any written records or
                           documents in his possession relating to such claim
                           reasonably requested by the Company;

<PAGE>

                  2.       take such action in connection with contesting such
                           claim as the Company shall reasonably request in
                           writing from time to time, including without
                           limitation accepting legal representation with
                           respect to such claim by an attorney competent in
                           respect of the subject matter and reasonably selected
                           by the Company;

                  3.       cooperate with the Company in good faith in order
                           effectively to contest such claim; and

                  4.       permit the Company to participate in any proceedings
                           relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including interest and penalties) incurred in connection with such
contest and shall indemnify and hold harmless the Executive, on an after-tax
basis, for and against any Excise Tax or income tax, including interest and
penalties with respect thereto, imposed as a result of such representation and
payment of costs and expenses. Without limiting the foregoing provisions of this
Section 6(f), the Company shall control all proceedings taken in connection with
the contest of any claim contemplated by this Section 6(f) and, at its sole
option, may pursue or forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of such claim
(provided, however, that the Executive may participate therein at his own cost
and expense) and may, at its option, either direct the Executive to pay the tax
claimed and sue for a refund or contest the claim in any permissible manner, and
the Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company shall determine; provided, however, that if the
Company directs the Executive to pay the tax claimed and sue for a refund, the
Company shall advance the amount of such payment to the Executive on an
interest-free basis and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax, including interest or
penalties with respect thereto, imposed with respect to such advance; and
provided further, however, that any extension of the statute of limitations
relating to payment of taxes for the taxable year of the Executive with respect
to which the contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company's control of any such contested claim
shall be limited to issues with respect to which a Gross-Up Payment would be
payable hereunder and the Executive shall be entitled to settle or contest, as
the case may be, any other issue raised by the Internal Revenue Service or any
other taxing authority.

               (g) If, after the receipt by the Executive of an amount advanced
         by the Company pursuant to Section 6(f) hereof, the Executive receives
         any refund with respect to such claim, the Executive shall (subject to
         the Company's complying with the requirements of Section 6(f) hereof)
         promptly pay the Company the amount of such refund (together with any
         interest paid or credited thereon after any taxes applicable thereto).
         If, after the receipt by the Executive of an amount advanced by the
         Company pursuant to Section 6(f) hereof, a determination is made that
         the Executive shall not be entitled to any refund with respect to such
         claim and the Company does not notify the Executive in writing of its
         intent to contest such denial or refund prior to the expiration of
         thirty (30) calendar days after such determination, then such advance
         shall be forgiven and shall not be required to be repaid and the amount
         of any such advance shall offset, to the extent thereof, the amount of
         Gross-Up Payment required to be paid by the Company to the Executive
         pursuant to this Section 6.

<PAGE>

         7.    SUCCESSORS; BINDING AGREEMENT.

               (a) This Agreement shall be binding upon and shall inure to the
         benefit of the Company, its successors and assigns and, at the time of
         any such succession or assignment, the Company shall require any
         successor or assign to expressly assume and agree to perform this
         Agreement in the same manner and to the same extent that the Company
         would be required to perform it if no such succession or assignment had
         taken place. The term "the Company" as used herein shall include such
         successors and assigns. The term "successors and assigns" as used
         herein shall mean a corporation or other entity acquiring ownership,
         directly or indirectly, of all or substantially all the assets and
         business of the Company (including this Agreement) whether by operation
         of law or otherwise.

               (b) Neither this Agreement nor any right or interest hereunder
         shall be assignable or transferable by the Executive, his beneficiaries
         or legal representatives, except by will or by the laws of descent and
         distribution. This Agreement shall inure to the benefit of and be
         enforceable by the Executive's legal personal representative.

         8.    FEES AND EXPENSES. The Company shall pay legal fees and related
expenses (including the cost of experts, evidence and counsel) incurred by the
Executive as they become due as a result of (a) the Executive's termination of
employment (including all such fees and expenses, if any, incurred in contesting
or disputing any such termination of employment), or (b) the Executive seeking
to obtain or enforce any right or benefit provided by this Agreement; provided,
however, that the circumstances set forth in clauses (a) and (b) (other than as
a result of the Executive's termination of employment under circumstances
described in Section 2.3(d)) occurred on or after a Change in Control.

         9.    NOTICE. For the purpose of this Agreement, notices and all other
communications provided for in the Agreement (including the Notice of
Termination) shall be in writing and shall be deemed to have been duly given
when personally delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses last given by each party
to the other, provided that all notices to an Employer shall be directed to the
attention of the Board with a copy to the Secretary of such Employer. All
notices and communications shall be deemed to have been received on the date of
delivery thereof or on the third business day after the mailing thereof, except
that notice of change of address shall be effective only upon receipt.

         10.   NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any
benefit, bonus, incentive or other plan or program provided by the Company or
any of its Subsidiaries and for which the Executive may qualify, nor shall
anything herein limit or reduce such rights as the Executive may have under any
other agreements with the Company or any of its Subsidiaries. Amounts which are
vested benefits or which the Executive is otherwise entitled to receive under
any plan or program of the Company or any of its Subsidiaries shall be payable
in accordance with such plan or program.

        11.    SETTLEMENT OF CLAIMS. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Company or any of its Subsidiaries may have against the Executive or others.

<PAGE>

        12.    MISCELLANEOUS. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive and the Company. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No agreement or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly set
forth in this Agreement. No additional compensation provided under any benefit
or compensation plans to the Executive shall be deemed to modify or otherwise
affect the terms of this Agreement or any of the Executive's entitlements
hereunder.

        13.    GOVERNING LAW. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the Commonwealth of Kentucky.

        14.    SEVERABILITY. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.

        15.    ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties hereto and supersedes all prior agreements, if any,
understandings and arrangements, oral or written, between the parties hereto
with respect to the subject matter hereof, including, without limiting the
foregoing, his prior Change-In-Control Agreement (if any), as previously
amended, which shall cease to be of any further effect.

        IN WITNESS WHEREOF, the Company has caused this Agreement to be executed
by its duly authorized representative and the Executive has executed this
Agreement as of the day and year first above written.

                                    LG&E ENERGY CORP.

                                    ------------------------------------
                                    Roger W. Hale
                                    Chairman and Chief Executive Officer

                                    ------------------------------------
                                    Executive
<PAGE>

                           CHANGE-IN-CONTROL AGREEMENT

         THIS AGREEMENT made this DATE, by and between LG&E ENERGY CORP. (the
"Company") and _____________________("Executive").

         WHEREAS, the Board of Directors of the Company (the "Board") recognizes
that the possibility of a Change in Control (as hereinafter defined) exists and
that the occurrence of a Change in Control can result in significant
distractions of its key management personnel because of the uncertainties
inherent in such a situation;

         WHEREAS, the Board has determined that it is essential and in the best
interest of the Company and Powergen, plc (the "Parent") to retain the services
of the Executive in the event of a Change in Control and to ensure his continued
dedication and efforts in such event without undue concern for his personal
financial and employment security; and

         WHEREAS, in order to induce the Executive to remain in the employ of
the Company or a Subsidiary (as hereinafter defined), as the case may be,
particularly in the event of a threat or the occurrence of a Change in Control,
the Company desires to enter into this Agreement with the Executive to provide
the Executive with certain benefits in the event his employment is terminated as
a result of, or in connection with, a Change in Control.

         NOW, THEREFORE, in consideration of the respective agreements of the
parties contained herein, it is agreed as follows:

         1.       TERM OF AGREEMENT. This Agreement shall commence as of the
_____ day of _________________, 2000, and shall continue in effect until SAME
MONTH/DAY, 2002, provided, however, that commencing on SAME MONTH/DAY, 2002, and
on SAME MONTH/DAY thereafter, the term of this Agreement shall automatically be
extended for one (1) year unless either the Company or the Executive shall have
given written notice to the other at least ninety (90) days prior thereto that
the term of this Agreement shall not be so extended; and provided, further,
however, that notwithstanding any such notice by the Company not to extend, the
term of this Agreement shall not expire prior to the expiration of twenty-four
(24) months after any Change in Control which occurs while this Agreement is in
effect.

         2.       DEFINITIONS.

                  2.1   BASE AMOUNT; BONUS AMOUNT. For purposes of this
         Agreement, "Base Amount" shall mean the greater of the Executive's
         annual base salary from the Company and its Subsidiaries (a) at the
         rate in effect on the Termination Date (as hereinafter defined) or (b)
         at the highest rate in effect at any time during the ninety (90) day
         period prior to the Change in Control, and shall include all amounts of
         base salary that are deferred under any qualified and non-qualified
         employee benefits plans of the Company or any Subsidiary or under any
         other agreement or arrangement. For purposes of this Agreement; "Bonus
         Amount" shall mean the greater of (a) the most recent annual bonus paid
         or payable to the Executive, (b) the

<PAGE>

         annual bonus paid or payable to the Executive under the Short Term
         Incentive Plan for the full fiscal year ended prior to the fiscal year
         during which a Change in Control occurred or (c) the Executive's target
         award under the Short Term Incentive Plan for the full fiscal year
         ended prior to the fiscal year during which a Change in Control
         occurred.

                  2.2   CAUSE. For purposes of this Agreement, a termination for
         "Cause" is a termination evidenced by a resolution adopted in good
         faith by at least seventy-five percent (75%) of the Board that (i)
         there has been repeated gross negligence by the Executive in performing
         the reasonably assigned duties on behalf of an Employer required by and
         in accordance with his employment by such Employer, or (ii) the
         Executive has committed a felony in the course of performing those
         duties. Notwithstanding anything contained in this Agreement to the
         contrary, no failure to perform by the Executive after a Notice of
         Termination (as hereinafter defined) is given by the Executive shall
         constitute Cause for purposes of this Agreement. No act, or failure to
         act, on Executive's part shall be deemed to be "repeated" unless the
         Executive shall have received a written notice from seventy-five
         percent (75%) of the Board setting forth in detail the particulars of
         the act, or the failure to act, which the Company contends would
         constitute Cause when repeated and Executive then repeats such act or
         failure to act.

                        2.3   CHANGE IN CONTROL.

For purposes of this Agreement, a "Change in Control" shall mean the occurrence
during the term of this Agreement of any of the following events:

                        (a)   An acquisition (other than directly from Parent)
                  of any securities of Parent entitled generally to vote on the
                  election of directors (the "Voting Securities") by any
                  "Person" (as the term person is used for purposes of Section
                  13(d) or 14(d) of the Securities Exchange Act of 1934, as
                  amended (the "1934 Act")) immediately after which such Person
                  has "Beneficial Ownership" (within the meaning of Rule 13d-3
                  promulgated under the 1934 Act) of fifteen percent (15%) or
                  more of the combined voting power of Parent's then outstanding
                  Voting Securities; PROVIDED, HOWEVER, in determining whether a
                  Change in Control has occurred, Voting Securities which are
                  acquired in a "Non-Control Acquisition" (as hereinafter
                  defined) shall not constitute an acquisition which would cause
                  a Change in Control. A "Non-Control Acquisition" shall mean an
                  acquisition by (1) an employee benefit plan (or a trust
                  forming a part thereof) maintained by (a) Parent or (b) any
                  corporation or other Person of which a majority of its voting
                  power or its equity securities or equity interest is owned
                  directly and indirectly by Parent (a "Subsidiary") or (2)
                  Parent or any Subsidiary.

                        (b)   The individuals who, as of the date this
                  Agreement was approved by the Board, are members of the Board
                  (the "Incumbent Board"), cease for any reason to constitute at
                  least two-thirds of the Board; provided, however, that if the
                  election, or nomination for election by Parent's stockholders,
                  of any new director was approved by a vote of at least two-

<PAGE>

                  thirds of the Incumbent Board, such new director shall, for
                  purposes of the Agreement, be considered as a member of the
                  Incumbent Board; or

                        (c)   Approval by stockholders of Parent of:

                              (1)   A merger, consolidation or reorganization
                              involving Parent; unless

                                    (i)    the stockholders of Parent
                              immediately before such merger, consolidation or
                              reorganization, own, directly or indirectly
                              immediately following such merger, consolidation
                              or reorganization, at least seventy-five percent
                              (75%) of the combined voting power of the
                              outstanding voting securities of the corporation
                              resulting from such merger or consolidation or
                              reorganization (the "Surviving Corporation") in
                              substantially the same proportion to each other as
                              their ownership of the Voting Securities
                              immediately before such merger, consolidation or
                              reorganization, and

                                    (ii)   the individuals who were
                              members of the Incumbent Board immediately prior
                              to the execution of the agreement providing for
                              such merger, consolidation or reorganization
                              constitute at least two-thirds of the members of
                              the board of directors of the Surviving
                              Corporation;

                              (2)   A complete liquidation or dissolution of
                              Parent or the Company; unless, in the case of the
                              Company, Parent continues to own directly or
                              indirectly all or substantially all of the
                              Company's assets;

                              (3)   An agreement for the sale or other
                              disposition of all or substantially all of the
                              assets of Parent or the Company to any Person
                              (other than a transfer to a Subsidiary);

                              (4)   A merger or other combination involving
                              the Company as a result of which Parent ceases to
                              beneficially own more than 50% of the outstanding
                              Voting Securities of the successor to the Company,
                              unless Parent continues to own directly or
                              indirectly all or substantially all of the
                              Company's assets; or

                              (5)   Any Person acquires Beneficial Ownership
                              of a greater percentage of the Voting Securities
                              of the Company than the percentage of such Voting
                              Securities then held, directly or indirectly, by
                              Parent.

                  (d)   Notwithstanding the foregoing clauses (a), (b), and (c),
         a Change in Control shall not be deemed to occur solely because any
         Person (the "Subject Person") acquired Beneficial Ownership of more
         than the permitted amount of the

<PAGE>

         outstanding Voting Securities as a result of the acquisition of Voting
         Securities by Parent which, by reducing the number of Voting Securities
         outstanding, increases the proportional number of shares, provided that
         if a Change in Control would occur (but for the operation of this
         sentence) as a result of the acquisition of Voting Securities by
         Parent, and after such share acquisition by Parent, the Subject Person
         or entity becomes the Beneficial Owner of any additional Voting
         Securities which increases the percentage of the then outstanding
         Voting Securities Beneficially Owned by the Subject Person, then a
         Change in Control shall occur.

                  (e)   Notwithstanding anything contained in this Agreement to
         the contrary, if the Executive's employment is terminated during the
         term of this Agreement and the Executive reasonably demonstrates that
         such termination (i) was at the request of a third party who has
         indicated an intention or taken steps reasonably calculated to effect a
         Change in Control and who effectuates a Change in Control (a "Third
         Party") or (ii) otherwise occurred in connection with, or in
         anticipation of, a Change in Control which actually occurs, then for
         all purposes of this Agreement, the date of a Change in Control with
         respect to the Executive shall mean the date immediately prior to the
         date of such termination of the Executive's employment.

         2.4      DISABILITY. For purposes of this Agreement, "Disability" shall
mean (i) a physical or mental infirmity which has been determined to be total
and permanent disability under and in accordance with the provisions of the
Company's Long Term Disability Plan for Employees of Louisville Gas and Electric
Company who are not members of a Bargaining Unit or (ii) in the event the
Company does not maintain such plan at the time of the determination of the
Executive's Disability, a physical or mental infirmity which impairs the
Executive's ability to substantially perform his duties with an Employer which
continues for a period of at least one hundred eighty (180) consecutive days.

         2.5      AN EMPLOYER. For the purposes of this Agreement, "an Employer"
shall mean: (i) in the event the Executive is an officer of the Company and not
of any of its Subsidiaries at the time of a Change in Control, the Company; (ii)
in the event the Executive is an officer of one or more Subsidiaries of the
Company, but not of the Company, at the time of a Change in Control, any such
Subsidiary; and (iii) in the event the Executive is an officer of the Company
and one or more Subsidiaries at the time of a Change in Control, any such entity
of which the Executive is an officer at the time of the Change in Control.

         2.6      GOOD REASON.

                  (a)   For purposes of this Agreement, "Good Reason" shall mean
         the occurrence after a Change in Control of any of the events or
         conditions described in subsections (1) through (8) hereof:

                        (1)   a reduction by the Company in the
                              Executive's Base Salary or annual target bonus
                              opportunity as in effect prior to such reduction
                              or any failure to pay the Executive any
                              compensation or benefits to which the Executive is
                              entitled within thirty days of the applicable due
                              date, provided that the Company may correct

<PAGE>

                              such reduction or failure within thirty (30) days
                              of its commission;

                        (2)   Parent or the Company require the Executive
                              to be relocated anywhere in excess of one hundred
                              (100) miles of his present office location, except
                              for required travel on Parent or Company business
                              consistent with his business travel obligations;

                        (3)   a failure by Parent or the Company to
                              maintain plans providing benefits at least as
                              beneficial in the aggregate as those provided by
                              any benefit or compensation plan, retirement or
                              pension plan, stock option plan, bonus plan,
                              long-term incentive plan, life insurance plan,
                              health and accident plan or disability plan in
                              which the Executive is participating prior the
                              Change in Control, or if the Company or Parent has
                              taken any action which would adversely affect the
                              Executive's participation in or materially reduce
                              the Executive's benefits under any of such plans
                              or deprive him of any material fringe benefit
                              enjoyed by him prior to the Change in Control, or
                              if the Company or Parent has failed to provide him
                              with the number of paid vacation days to which he
                              would be entitled in accordance with the Company's
                              normal vacation policy immediately prior to the
                              Change in Control, as applicable;

                        (4)   Parent or the Company fails to obtain the
                              assumption of the obligations contained in this
                              Agreement by any successor as contemplated in
                              Section 7 hereof;

                        (5)   any purported termination of the Executive's
                              employment by Parent or the Company which is not
                              effected pursuant to a Notice of Termination
                              satisfying the requirements of Section 4 below;
                              and, for purposes of this Agreement, no such
                              purported termination shall be effective;

                        (6)   any material breach by Parent or the Company of
                              any provision of this Agreement;

                        (7)   any purported termination of the Executive's
                              employment for Cause by Parent or the Company
                              which does not comply with the terms of Section
                              2.2 of this Agreement;

                        (8)   the Company materially reduces, individually
                              or in the aggregate, the Executive's title, job
                              authorities or responsibilities as in effect prior
                              to such reduction; or

                  (b)   Any event or condition described in this Section 2.6(a)
         (1) through (8) above, which occurs prior to a Change in Control but
         which the Executive reasonably

<PAGE>

         demonstrates (i) was at the request of a Third Party, or (ii) otherwise
         arose in connection with or in anticipation of a Change in Control
         which actually occurs, shall constitute Good Reason for purposes of
         this Agreement notwithstanding that it occurred prior to the Change in
         Control.

                  (c)   Until the Executive's Disability, the Executive's rights
         to terminate his employment pursuant to this Section 2.6 shall not be
         affected by his incapacity due to physical or mental illness.

         3.       TERMINATION OF EMPLOYMENT.

                  3.1   If, during the term of this Agreement, the Executive's
employment with an Employer shall be terminated within twenty-four (24) months
following a Change in Control, then the Executive shall be entitled to the
following compensation and benefits:

                        (a)   If the Executive's employment with an Employer
                  shall be terminated (1) by an Employer for Cause or
                  Disability, (2) by reason of the Executive's death, or (3) by
                  the Executive other than for Good Reason, the Company shall
                  pay the Executive all amounts earned or accrued for or on
                  behalf of the Company or any of its Subsidiaries through the
                  Termination Date (as hereinafter defined) but not paid as of
                  the Termination Date, including (i) base salary, (ii)
                  reimbursement for reasonable and necessary expenses incurred
                  by the Executive on behalf of the Company or any Subsidiary
                  during the period ending on the Termination Date and (iii)
                  vacation pay (collectively, "Accrued Compensation").

                        (b)   If the Executive's employment with an Employer
                  shall be terminated for any reason other than as specified in
                  clause (1) or (2) of Section 3.1(a) or if the Executive's
                  employment is terminated by the Executive for Good Reason, the
                  Executive shall be entitled to the following:

                              (i)   The Company shall pay the Executive all
                        Accrued Compensation;

                              (ii)  The Company shall pay, as a severance amount
                        to the Executive after the Termination Date, an amount
                        equal to 2.99 times the sum of (a) the Base Amount and
                        (b) the Bonus Amount;

                              (iii) For a number of months equal to the lesser
                        of (a) twenty-four (24) or (b) the number of months
                        remaining until the Executive's 65th birthday (the
                        "Continuation Period"), the Company shall at its expense
                        continue on behalf of the Executive and his dependents
                        and beneficiaries (to the same extent provided to the
                        dependents and beneficiaries prior to the Executive's
                        termination) the life insurance, disability, medical,
                        dental, and hospitalization benefits provided (x) to the
                        Executive by the Company and/or its Subsidiaries at any
                        time within ninety (90) days preceding a Change in
                        Control or at any time thereafter, or (y) to other
                        similarly situated executives

<PAGE>

                        who continue in the employ of the Company or its
                        Subsidiaries during the Continuation Period. The
                        coverage and benefits (including deductibles and costs)
                        provided in this Section 3.1(b)(iii) during the
                        Continuation Period shall be no less favorable to the
                        Executive and his dependents and beneficiaries, than the
                        most favorable of such coverages and benefits set forth
                        in clauses (x) and (y) above. The Company's obligation
                        hereunder with respect to the foregoing benefits shall
                        be limited to the extent that the Executive obtains any
                        such benefits pursuant to a subsequent employer's
                        benefit plans, in which case the Company may reduce the
                        coverage of any benefits it is required to provide the
                        Executive hereunder as long as the aggregate coverages
                        and benefits of the combined benefit plans are no less
                        favorable to the Executive than the coverages and
                        benefits required to be provided hereunder. This
                        Subsection (iii) shall not be interpreted so as to limit
                        any benefits to which the Executive or his dependents
                        may be entitled under any of the Company's or any
                        Subsidiary's employee benefit plans, programs or
                        practices following the Executive's termination of
                        employment, including without limitation, retiree
                        medical and life insurance benefits; and

                              (iv)  The Company shall provide to the Executive
                        outplacement services in an amount up to twenty percent
                        (20%) of the Base Amount.

                  (c)   The amounts provided for in Section 3.1(a) and 3.1(b)(i)
         and (ii) shall be paid in a lump sum within thirty (30) days after the
         Executive's Termination Date.

                  (d)   The Executive shall not be required to mitigate the
         amount of any payments provided for in this Agreement by seeking other
         employment or otherwise and no such payment shall be offset or reduced
         by the amount of any compensation or benefits provided to the Executive
         in any subsequent employment except as provided in Section 3.1(b)(iii).

                  3.2   The provisions of this Agreement, and any payment
         provided for hereunder, shall not reduce or increase any amounts
         otherwise payable, or in any way diminish or enhance the Executive's
         existing rights, or rights which would accrue solely as a result of the
         passage of time, under any benefit plan, incentive plan, or securities
         plan, employment agreement or other contract, plan or arrangement with
         the Company, any Subsidiary or any other party, including, but not
         limited to, those specified in Exhibit A attached hereto, provided,
         however, the Company shall not be required to make duplicative payments
         of Accrued Compensation. A determination of a Change in Control under
         this Agreement is effective only with respect to benefits payable
         hereunder, and is not determinative of a change in control under any
         benefit plan, incentive plan, or securities plan, employment agreement
         or other contract, plan or arrangement with the Company, any Subsidiary
         or any other party.

         4.       NOTICE OF TERMINATION. Any purported termination by an
Employer or by the Executive shall be communicated by written Notice of
Termination to the other. For purposes of this Agreement, a "Notice of
Termination" shall mean a notice which indicates

<PAGE>

the specific termination provision in this Agreement relied upon and shall set
forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of the Executive's employment under the provision so
indicated. For purposes of this Agreement, no such purported termination shall
be effective without such Notice of Termination.

         5.       TERMINATION DATE. "Termination Date" shall mean, in the case
of the Executive's death, his date of death and, in all other cases, the date
specified in the Notice of Termination subject to the following:

                  (a)   If the Executive's employment is terminated by an
         Employer for Cause or due to Disability, the date specified in the
         Notice of Termination shall be at least thirty (30) days from the date
         the Notice of Termination is given to the Executive, provided that, in
         the case of Disability, the Executive shall not have returned to the
         full-time performance of his duties during such period of at least (30)
         days; and

                  (b)   If the Executive's employment is terminated for Good
         Reason, the date specified in the Notice of Termination shall not be
         more than sixty (60) days from the date the Notice of Termination is
         given to the Employer.

         6.       CERTAIN ADDITIONAL PAYMENTS

                  (a)   Notwithstanding anything in the Agreement to the
         contrary, in the event that a Change in Control occurs and it is
         determined (as hereafter provided) that any payment or distribution by
         the Company or any affiliates to or for the benefit of the Executive,
         whether paid or payable or distributed or distributable pursuant to the
         terms of this Agreement or otherwise pursuant to or by reason of any
         other agreement, policy, plan, program or arrangement, including
         without limitation any stock option, stock appreciation right or
         similar right, or the lapse or termination of any restriction on or the
         vesting or exercisability of any of the foregoing (individually and
         collectively a "Payment"), would be subject to the excise tax imposed
         by Section 4999 (or any successor provision thereto) of the Internal
         Revenue Code of 1986, as amended (the "Code") by reason of being
         considered "contingent on a change in ownership or control" of the
         Company or the Parent, within the meaning of Section 280G of the Code
         (or any successor provision thereto), or to any similar tax imposed by
         state or local law, or any interest or penalties with respect to any
         such taxes (such taxes, together with any such interest and penalties,
         being hereafter collectively referred to as the "Excise Tax"), then the
         Executive shall be entitled to receive an additional payment or
         payments (individually and collectively, a "Gross-Up Payment"). The
         Gross-Up Payment shall be in an amount such that, after payment by the
         Executive of all taxes (including any interest or penalties imposed
         with respect to such taxes), including any Excise Tax imposed upon the
         Gross-Up Payment, the Executive retains an amount of the Gross-Up
         Payment equal to the Excise Tax imposed upon the Payment.

                  (b)   Subject to the provisions of Section 6(f) hereof, all
         determinations required to be made under this Section 6, including
         whether an Excise Tax is payable by the Executive and the amount of
         such Excise Tax and whether a Gross-Up Payment is required to be paid
         to the Executive and the amount of such Gross-Up

<PAGE>

         Payment, if any, shall be made by a nationally recognized accounting
         firm (the "Accounting Firm") selected by the Executive in his sole
         discretion. The Executive shall direct the Accounting Firm to submit
         its determination and detailed supporting calculations to both the
         Company and the Executive within thirty (30) calendar days after the
         Termination Date, if applicable, and any such other time or times as
         may be requested by the Company or the Executive. If the Accounting
         Firm determines that any Excise Tax is payable by the Executive, the
         Company shall pay or cause to be paid the required Gross-Up Payment in
         cash to the Executive within five (5) business days after receipt of
         such determination and calculations with respect to any Payment to the
         Executive. If the Accounting Firm determines that no Excise Tax is
         payable by the Executive, it shall, at the same time as it makes such
         determination, furnish the Company and the Executive an opinion that
         the Executive has substantial authority not to report any Excise Tax on
         his federal, state or local income or other tax return. As a result of
         the uncertainty in the application of Section 4999 of the Code (or any
         successor provision thereto) at the time of any determination by the
         Accounting Firm hereunder, it is possible that Gross-Up Payments which
         will not have been made by the Company should have been made (an
         "Underpayment"), consistent with the calculations required to be made
         hereunder. In the event that the Company exhausts or fails to pursue
         its remedies pursuant to Section 6(f) hereof and the Executive
         thereafter is required to make a payment of any Excise Tax, the
         Executive shall direct the Accounting Firm to determine the amount of
         the Underpayment that has occurred and to submit its determination and
         detailed supporting calculations to both the Company and the Executive
         as promptly as possible. Any such Underpayment shall be promptly paid
         by the Company in cash to, or for the benefit of, the Executive within
         five (5) business days after receipt of such determination and
         calculations.

                  (c)   The Company and the Executive shall each provide the
         Accounting Firm access to and copies of any books, records and
         documents in the possession of the Company or the Executive, as the
         case may be, reasonably requested by the Accounting Firm, and otherwise
         cooperative with the Accounting Firm in connection with the preparation
         and issuance of the determinations and calculations contemplated by
         Section 6(b) hereof. Any determination by the Accounting Firm as to the
         amount of the Gross-Up Payment will be binding on the Company and the
         Executive.

                  (d)   The federal, state, and local income or other tax
         returns filed by the Executive will be prepared and filed on a
         consistent basis with the determination of the Accounting Firm with
         respect to the Excise Tax payable by the Executive. The Executive will
         make proper payment of the amount of any Excise Payment and, at the
         request of the Company, provide to the Company true and correct copies
         (with any amendments) of the Executive's federal income tax return as
         filed with the Internal Revenue Service and corresponding state and
         local tax returns, if relevant, as filed with the applicable taxing
         authority, and such other documents reasonably requested by the
         Company, evidencing such payment. If prior to the filing of the
         Executive's federal income tax return, or corresponding state or local
         tax return, if relevant, the Accounting Firm determines that the amount
         of the Gross-Up Payment should be reduced, the Executive will within
         five (5) business days pay to the Company the amount of such reduction.

<PAGE>

                  (e)   The fees and expenses of the Accounting Firm for its
         services in connection with the determinations and calculations
         contemplated by Section 6(b) hereof shall be borne by the Company. If
         such fees and expenses are initially paid by the Executive, the Company
         shall reimburse the Executive the full amount of such fees and expenses
         within five (5) business days after receipt from the Executive of a
         statement therefor and reasonable evidence of his payment thereof.

                  (f)   The Executive shall notify the Company in writing of any
         claim by the Internal Revenue Service or any other taxing authority
         that, if successful, would require the payment by the Company of a
         Gross-Up Payment. Such notification shall be given as promptly as
         practicable but no later than ten (10) business days after the
         Executive actually receives notice of such claim and the Executive
         shall further apprise the Company of the nature of such claim and the
         date on which such claim is requested to be paid (in each case, to the
         extent known by the Executive). The Executive shall not pay such claim
         prior to the earlier of (i) the expiration of the thirty (30)
         calendar-day period following the date on which he gives such notice to
         the Company and (ii) the date that any payment of amount with respect
         to such claim is due. If the Company notifies the Executive in writing
         prior to the expiration of such period that it desires to contest such
         claim, the Executive shall:

                        1.    provide the Company with any written records or
                              documents in his possession relating to such claim
                              reasonably requested by the Company;

                        2.    take such action in connection with contesting
                              such claim as the Company shall reasonably request
                              in writing from time to time, including without
                              limitation accepting legal representation with
                              respect to such claim by an attorney competent in
                              respect of the subject matter and reasonably
                              selected by the Company;

                        3.    cooperate with the Company in good faith in order
                              effectively to contest such claim; and

                        4.    permit the Company to participate in any
                              proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including interest and penalties) incurred in connection with such
contest and shall indemnify and hold harmless the Executive, on an after-tax
basis, for and against any Excise Tax or income tax, including interest and
penalties with respect thereto, imposed as a result of such representation and
payment of costs and expenses. Without limiting the foregoing provisions of this
Section 6(f), the Company shall control all proceedings taken in connection with
the contest of any claim contemplated by this Section 6(f) and, at its sole
option, may pursue or forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of such claim
(provided, however, that the Executive may participate therein at his own cost
and expense) and may, at its option, either direct the Executive to pay the tax
claimed and sue for a refund or contest the claim in any permissible manner, and
the Executive agrees to prosecute such contest to a determination before any

<PAGE>

administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company shall determine; provided, however, that if the
Company directs the Executive to pay the tax claimed and sue for a refund, the
Company shall advance the amount of such payment to the Executive on an
interest-free basis and shall indemnify and hold the Executive harmless, on an
after-tax basis, from any Excise Tax or income tax, including interest or
penalties with respect thereto, imposed with respect to such advance; and
provided further, however, that any extension of the statute of limitations
relating to payment of taxes for the taxable year of the Executive with respect
to which the contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company's control of any such contested claim
shall be limited to issues with respect to which a Gross-Up Payment would be
payable hereunder and the Executive shall be entitled to settle or contest, as
the case may be, any other issue raised by the Internal Revenue Service or any
other taxing authority.

                  (g)   If, after the receipt by the Executive of an amount
         advanced by the Company pursuant to Section 6(f) hereof, the Executive
         receives any refund with respect to such claim, the Executive shall
         (subject to the Company's complying with the requirements of Section
         6(f) hereof) promptly pay the Company the amount of such refund
         (together with any interest paid or credited thereon after any taxes
         applicable thereto). If, after the receipt by the Executive of an
         amount advanced by the Company pursuant to Section 6(f) hereof, a
         determination is made that the Executive shall not be entitled to any
         refund with respect to such claim and the Company does not notify the
         Executive in writing of its intent to contest such denial or refund
         prior to the expiration of thirty (30) calendar days after such
         determination, then such advance shall be forgiven and shall not be
         required to be repaid and the amount of any such advance shall offset,
         to the extent thereof, the amount of Gross-Up Payment required to be
         paid by the Company to the Executive pursuant to this Section 6.

         7.       SUCCESSORS; BINDING AGREEMENT.

                  (a)   This Agreement shall be binding upon and shall inure to
         the benefit of the Company, its successors and assigns and, at the time
         of any such succession or assignment, the Company shall require any
         successor or assign to expressly assume and agree to perform this
         Agreement in the same manner and to the same extent that the Company
         would be required to perform it if no such succession or assignment had
         taken place. The term "the Company" as used herein shall include such
         successors and assigns. The term "successors and assigns" as used
         herein shall mean a corporation or other entity acquiring ownership,
         directly or indirectly, of all or substantially all the assets and
         business of the Company (including this Agreement) whether by operation
         of law or otherwise.

                  (b)   Neither this Agreement nor any right or interest
         hereunder shall be assignable or transferable by the Executive, his
         beneficiaries or legal representatives, except by will or by the laws
         of descent and distribution. This Agreement shall inure to the benefit
         of and be enforceable by the Executive's legal personal representative.

         8.       FEES AND EXPENSES. The Company shall pay legal fees and
related expenses (including the cost of experts, evidence and counsel) incurred
by the Executive as they

<PAGE>

become due as a result of (a) the Executive's termination of employment
(including all such fees and expenses, if any, incurred in contesting or
disputing any such termination of employment), or (b) the Executive seeking to
obtain or enforce any right or benefit provided by this Agreement; provided,
however, that the circumstances set forth in clauses (a) and (b) (other than as
a result of the Executive's termination of employment under circumstances
described in Section 2.3(d)) occurred on or after a Change in Control.

         9.       NOTICE. For the purpose of this Agreement, notices and all
other communications provided for in the Agreement (including the Notice of
Termination) shall be in writing and shall be deemed to have been duly given
when personally delivered or sent by certified mail, return receipt requested,
postage prepaid, addressed to the respective addresses last given by each party
to the other, provided that all notices to an Employer shall be directed to the
attention of the Board with a copy to the Secretary of such Employer. All
notices and communications shall be deemed to have been received on the date of
delivery thereof or on the third business day after the mailing thereof, except
that notice of change of address shall be effective only upon receipt.

         10.      NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any
benefit, bonus, incentive or other plan or program provided by the Company or
any of its Subsidiaries and for which the Executive may qualify, nor shall
anything herein limit or reduce such rights as the Executive may have under any
other agreements with the Company or any of its Subsidiaries. Amounts which are
vested benefits or which the Executive is otherwise entitled to receive under
any plan or program of the Company or any of its Subsidiaries shall be payable
in accordance with such plan or program.

         11.      SETTLEMENT OF CLAIMS. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any circumstances, including, without
limitation, any set-off, counterclaim, recoupment, defense or other right which
the Company or any of its Subsidiaries may have against the Executive or others.

         12.      MISCELLANEOUS. No provision of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive and the Company. No waiver by either
party hereto at any time of any breach by the other party hereto of, or
compliance with, any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No agreement or
representations, oral or otherwise, express or implied, with respect to the
subject matter hereof have been made by either party which are not expressly set
forth in this Agreement. No additional compensation provided under any benefit
or compensation plans to the Executive shall be deemed to modify or otherwise
affect the terms of this Agreement or any of the Executive's entitlements
hereunder.

         13.      GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the Commonwealth of
Kentucky.

<PAGE>

         14.      SEVERABILITY. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof.

         15.      ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties hereto and supersedes all prior agreements, if
any, understandings and arrangements, oral or written, between the parties
hereto with respect to the subject matter hereof, including, without limiting
the foregoing, his prior Change-In-Control Agreement (if any), as previously
amended, which shall cease to be of any further effect.

         IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized representative and the Executive has executed
this Agreement as of the day and year first above written.

                           LG&E ENERGY CORP.

                           ------------------------------------
                           Roger W. Hale
                           Chairman and Chief Executive Officer

                           ------------------------------------
                           Executive

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