Exhibit 4.1

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                         ARIZONA PUBLIC SERVICE COMPANY
               (formerly Central Arizona Light and Power Company)

                                       TO

                              THE BANK OF NEW YORK


                                      AS TRUSTEE UNDER CENTRAL ARIZONA LIGHT AND
                                               POWER COMPANY'S MORTGAGE AND DEED
                                             OF TRUST, DATED AS OF JULY 1, 1946.


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


                       Fifty-Sixth Supplemental Indenture


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


                          DATED AS OF NOVEMBER 1, 2002


                       This Mortgage covers real property,
                         personal property and chattels.


              This instrument and the above-mentioned Mortgage and
           Deed of Trust contain after-acquired property provisions.

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<PAGE>
                       FIFTY-SIXTH SUPPLEMENTAL INDENTURE

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

     INDENTURE, dated as of the 1st day of November, 2002, made and entered into
by and between  ARIZONA  PUBLIC SERVICE  COMPANY,  a corporation of the State of
Arizona,  the  principal  place of business and mailing  address of which is 400
North Fifth Street,  Phoenix,  Arizona 85004  (hereinafter  sometimes called the
Company),  party of the first part, and THE BANK OF NEW YORK, a New York banking
corporation,  the  mailing  address of which is 385 Rifle Camp Road,  3rd Floor,
West  Paterson,  New Jersey 07424  (hereinafter  sometimes  called the Trustee),
party of the second part, as Trustee under the Mortgage and Deed of Trust, dated
as of July 1,  1946  (hereinafter  called  the  Mortgage),  which  Mortgage  was
executed and  delivered by the Company  under its former name,  Central  Arizona
Light and Power  Company,  to secure the payment of bonds issued or to be issued
under and in accordance with the provisions of the Mortgage,  reference to which
said Mortgage is hereby made, this Indenture (hereinafter called the Fifty-sixth
Supplemental Indenture) being supplemental thereto;

     WHEREAS,  said  Mortgage was recorded and filed in Counties in the State of
Arizona as follows:

<TABLE>
<CAPTION>
                                                                              FILED AND ABSTRACTED
                                                RECORDED AS REAL MORTGAGE     AS CHATTEL MORTGAGE
                                               ---------------------------    --------------------
                                                                                 CHATTEL
                                                 DATE      BOOK OR              MORTGAGE
                    COUNTY                     RECORDED     DOCKET    PAGE        BOOK      PAGE
                    ------                     --------     ------    ----        ----      ----
<S>                                            <C>         <C>        <C>         <C>       <C>
     Apache...........................          7-28-50        16        1          9        154
     Cochise..........................           2-3-53        80       28         19        292
     Coconino.........................          1-20-53        39        1         10        286
     Gila.............................          1-17-53        32       84         17         --
     Graham...........................          12-3-63        92       87         15        223
     Maricopa.........................           8-6-46       408      163         92        204
     Mohave...........................         11-13-57        28       68         12         13
     Navajo...........................         10-14-49        31      483         16        521
     Pima.............................          1-24-53       558      351         14         --
     Pinal............................         10-25-52        68       31         12        591
     Yavapai..........................           8-7-46        79        1         12        223
     Yuma.............................           8-1-47        58      173         21        265

and in Counties in the State of New Mexico as follows:

     McKinley.........................          5-31-61        36      153          4        295

     San Juan.........................          1-31-61       472      140          (No. 72441)
</TABLE>

the copy  recorded  in Yuma  County,  Arizona  also being  effective  for La Paz
County,  Arizona,  formed on December 31, 1982; and copies of said Mortgage were
filed with the office of the Bureau of Indian  Affairs at Window Rock,  Arizona,
and with the Navajo Tribe of Indians at Window Rock, Arizona, and in the offices
of the Secretary of State and the State Land  Department of the State of Arizona
(all the said  counties  and the said  offices  above  referred to being  herein
referred to as "jurisdictions"); and

                                       2
<PAGE>
     WHEREAS, by the Mortgage,  the Company covenanted that it would execute and
deliver such supplemental  indenture or indentures and such further  instruments
and do such  further  acts as might be  necessary  or  proper  to carry out more
effectually  the purposes of the Mortgage and to make subject to the Lien of the
Mortgage any property thereafter  acquired,  made or constructed and intended to
be subject to the Lien thereof; and

     WHEREAS,  the Company has executed and delivered to the Trustee  fifty-five
indentures  supplemental to the Mortgage  (hereinafter  respectively  called the
First through the Fifty-fifth  Supplemental  Indentures) dated as of December 1,
1947,  April 1, 1949,  February  1, 1950,  December  1, 1950,  February 1, 1953,
November 1, 1953,  March 1, 1954,  October 1, 1957,  March 1, 1959,  November 1,
1961,  June 1, 1962,  December 1, 1962,  September  1, 1963,  September 1, 1967,
April 1, 1970, March 15, 1972,  April 1, 1974,  February 15, 1975, June 1, 1975,
November 15, 1975, April 15, 1977,  January 15, 1978, March 1, 1979, October 15,
1979, May 15, 1980,  February 2, 1982, April 15, 1982, July 1, 1983, October 15,
1983, June 15, 1984,  January 15, 1985, May 1, 1985,  June 1, 1985,  November 1,
1985,  January 15, 1986,  March 1, 1986, May 1, 1986,  February 1, 1987, June 1,
1987,  November 15, 1987, April 1, 1989,  February 15, 1990, May 15, 1990, April
15, 1991,  December 15, 1991,  January 15, 1992,  March 1, 1992,  June 15, 1992,
February 1, 1993, August 1, 1993,  August 1, 1993,  September 15, 1993, March 1,
1994,  November 15, 1996,  and April 1, 1997,  each of which has been or will be
recorded  or filed in, or a  recording  or filing is or will be  effective  with
respect to, each jurisdiction referred to above; and

     WHEREAS,  in  addition  to  the  property  described  in the  Mortgage,  as
heretofore  supplemented  and amended,  the Company has acquired  certain  other
property, rights and interests in property; and

     WHEREAS,  the  Company  has  heretofore  issued,  in  accordance  with  the
provisions of the Mortgage, as heretofore  supplemented and amended,  bonds of a
series  entitled and  designated  First Mortgage  Bonds,  2-3/4% Series due 1976
(hereinafter  called the bonds of the First Series),  in the aggregate principal
amount of Eight Million Five Hundred Thousand Dollars  ($8,500,000);  bonds of a
series  entitled and  designated  First Mortgage  Bonds,  3-1/8% Series due 1977
(hereinafter  called the bonds of the Second Series), in the aggregate principal
amount of Two Million Five Hundred  Thousand  Dollars  ($2,500,000);  bonds of a
series  entitled  and  designated  First  Mortgage  Bonds,  3%  Series  due 1979
(hereinafter  called the bonds of the Third Series),  in the aggregate principal
amount of Four  Million  Dollars  ($4,000,000);  bonds of a series  entitled and
designated First Mortgage Bonds,  2-3/4% Series due 1980 (hereinafter called the
bonds of the Fourth Series),  in the aggregate  principal amount of Five Million
Dollars  ($5,000,000);  bonds of a series entitled and designated First Mortgage
Bonds,  2-7/8%  Series  due 1980  (hereinafter  called  the  bonds of the  Fifth
Series), in the aggregate principal amount of Six Million Dollars  ($6,000,000);
bonds of a series entitled and designated  First Mortgage  Bonds,  3-1/2% Series
due 1983  (hereinafter  called the bonds of the Sixth Series),  in the aggregate
principal   amount  of  Fourteen   Million   Five   Hundred   Thousand   Dollars
($14,500,000); bonds of a series entitled and designated First Mortgage Bonds, 3
1/2% Series due  November 1, 1983  (hereinafter  called the bonds of the Seventh
Series),  in the  aggregate  principal  amount  of Five  Million  Seven  Hundred
Twenty-three  Thousand  Dollars  ($5,723,000);  bonds of a series  entitled  and
designated First Mortgage Bonds,  3-1/4% Series due 1984 (hereinafter called the
bonds of the  Eighth  Series),  in the  aggregate  principal  amount of  Fifteen
Million Dollars  ($15,000,000);  bonds of a series entitled and designated First
Mortgage  Bonds,  5-1/8%  Series due 1987  (hereinafter  called the bonds of the
Ninth Series),  in the aggregate  principal  amount of Fifteen  Million  Dollars
($15,000,000);  bonds of a series entitled and designated  First Mortgage Bonds,
4.70% Series due 1989 (hereinafter called the bonds of the Tenth Series), in the
aggregate principal amount of Twenty Million Dollars  ($20,000,000);  bonds of a
series  entitled and  designated  First  Mortgage  Bonds,  4.80% Series due 1991
(hereinafter  called  the  bonds  of the  Eleventh  Series),  in  the  aggregate
principal amount of Thirty-five Million Dollars ($35,000,000); bonds of a series
entitled and designated First Mortgage Bonds, 4.45% Series due 1992 (hereinafter
called the bonds of the Twelfth  Series),  in the aggregate  principal amount of

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<PAGE>
Twenty-five  Million  Dollars  ($25,000,000);  bonds  of a series  entitled  and
designated First Mortgage Bonds,  4.40% Series due 1992 (hereinafter  called the
bonds  of  the  Thirteenth   Series),  in  the  aggregate  principal  amount  of
Twenty-five  Million  Dollars  ($25,000,000);  bonds  of a series  entitled  and
designated First Mortgage Bonds,  4.50% Series due 1993 (hereinafter  called the
bonds of the Fourteenth  Series),  in the aggregate  principal amount of Fifteen
Million Dollars  ($15,000,000);  bonds of a series entitled and designated First
Mortgage  Bonds,  6.25%  Series  due 1997  (hereinafter  called the bonds of the
Fifteenth  Series),  in the aggregate  principal  amount of Twenty-five  Million
Dollars ($25,000,000);  bonds of a series entitled and designated First Mortgage
Bonds,  8.50%  Series due 1975  (hereinafter  called the bonds of the  Sixteenth
Series),   in  the  aggregate   principal   amount  of  Thirty  Million  Dollars
($30,000,000);  bonds of a series entitled and designated  First Mortgage Bonds,
7.45% Series due 2002 (hereinafter called the bonds of the Seventeenth  Series),
in the aggregate principal amount of Sixty Million Dollars ($60,000,000);  bonds
of a series entitled and designated First Mortgage Bonds,  6.20% Series due 2004
(hereinafter  called  the  bonds of the  Eighteenth  Series),  in the  aggregate
principal  amount  of Fifty  Million  Dollars  ($50,000,000);  bonds of a series
entitled and designated First Mortgage Bonds, 9.50% Series due 1982 (hereinafter
called the bonds of the Nineteenth Series), in the aggregate principal amount of
One Hundred  Million  Dollars  ($100,000,000);  bonds of a series  entitled  and
designated First Mortgage Bonds,  9.80% Series due 1980 (hereinafter  called the
bonds  of  the  Twentieth  Series),   in  the  aggregate   principal  amount  of
Seventy-five  Million  Dollars  ($75,000,000);  bonds of a series  entitled  and
designated First Mortgage Bonds, 10.625% Series due 2000 (hereinafter called the
bonds  of  the  Twenty-first  Series),  in the  aggregate  principal  amount  of
Seventy-five  Million  Dollars  ($75,000,000);  bonds of a series  entitled  and
designated First Mortgage Bonds, 6.45% Series A due 2007 (hereinafter called the
bonds  of the  Twenty-second  Series),  in the  aggregate  principal  amount  of
Thirteen  Million  Dollars  ($13,000,000);   bonds  of  a  series  entitled  and
designated First Mortgage Bonds, 6.45% Series B due 2007 (hereinafter called the
bonds of the Twenty-third  Series),  in the aggregate principal amount of Thirty
Million Dollars  ($30,000,000);  bonds of a series entitled and designated First
Mortgage  Bonds,  6%  Series A due 2008  (hereinafter  called  the  bonds of the
Twenty-fourth  Series), in the aggregate principal amount of Thirty-four Million
Dollars ($34,000,000);  bonds of a series entitled and designated First Mortgage
Bonds,  9.95% Series due 2004 (hereinafter  called the bonds of the Twenty-fifth
Series),  in the aggregate  principal  amount of  Seventy-five  Million  Dollars
($75,000,000);  bonds of a series entitled and designated  First Mortgage Bonds,
12-1/8%  Series  due 2009  (hereinafter  called  the  bonds of the  Twenty-sixth
Series),  in the aggregate  principal  amount of  Seventy-five  Million  Dollars
($75,000,000);  bonds of a series entitled and designated  First Mortgage Bonds,
12-7/8%  Series due 2000  (hereinafter  called  the bonds of the  Twenty-seventh
Series),  in the aggregate  principal amount of One Hundred  Eighty-five Million
Dollars ($185,000,000); bonds of a series entitled and designated First Mortgage
Bonds,   10-3/8%  Series  due  1985   (hereinafter   called  the  bonds  of  the
Twenty-eighth  Series),  in the aggregate  principal amount of Sixty Million Two
Hundred Fifty Thousand  Dollars  ($60,250,000);  bonds of a series  entitled and
designated  First Mortgage Bonds,  16% Series due 1992  (hereinafter  called the
bonds of the  Twenty-ninth  Series),  in the aggregate  principal  amount of One
Hundred  Million  Dollars  ($100,000,000);   bonds  of  a  series  entitled  and
designated First Mortgage Bonds, 12-3/4% Series due 2013 (hereinafter called the
bonds of the Thirtieth Series), in the aggregate principal amount of One Hundred
Million Dollars ($100,000,000);  bonds of a series entitled and designated First
Mortgage  Bonds,  13-1/2% Series due 2013  (hereinafter  called the bonds of the
Thirty-first Series),  in the aggregate  principal amount of One Hundred Million
Dollars ($100,000,000); bonds of a series entitled and designated First Mortgage
Bonds, 15% Series due 1994  (hereinafter  called the bonds of the  Thirty-second
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
12% Series due 1995 (hereinafter  called the bonds of the Thirty-third  Series),
in the aggregate  principal  amount of One Hundred  Twenty-five  Million Dollars
($125,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
13-1/4%  Series  due 2007  (hereinafter  called  the bonds of the  Thirty-fourth
Series),   in  the  aggregate   principal   amount  of  Fifty  Million   Dollars
($50,000,000);  bonds of a series entitled and designated  First Mortgage Bonds,
11-1/2%  Series  due 2015  (hereinafter  called  the  bonds of the  Thirty-fifth
Series),  in the aggregate principal amount of One Hundred Fifty Million Dollars

                                       4
<PAGE>
($150,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
11-1/2%  Series  due  November  1,  2015  (hereinafter  called  the bonds of the
Thirty-sixth  Series),  in the aggregate principal amount of One Hundred Million
Dollars ($100,000,000); bonds of a series entitled and designated First Mortgage
Bonds, 11% Series due 2016 (hereinafter  called the bonds of the  Thirty-seventh
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
9-1/4%  Series  due 1996  (hereinafter  called  the  bonds of the  Thirty-eighth
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
9% Series due 1996 (hereinafter called the bonds of the Thirty-ninth Series), in
the  aggregate  principal  amount of One  Hundred  Twenty-five  Million  Dollars
($125,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
9% Series due 2017 (hereinafter called the bonds of the Fortieth Series), in the
aggregate principal amount of One Hundred Fifty Million Dollars  ($150,000,000);
bonds of a series entitled and designated  First Mortgage  Bonds,  9-7/8% Series
due 1997  (hereinafter  called  the  bonds of the  Forty-first  Series),  in the
aggregate   principal  amount  of  One  Hundred   Twenty-five   Million  Dollars
($125,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
10-3/4%  Series  due 2017  (hereinafter  called  the  bonds of the  Forty-second
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
10-3/4%  Series  due 2019  (hereinafter  called  the  bonds  of the  Forty-third
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
10-1/4%  Series  due 2000  (hereinafter  called  the  bonds of the  Forty-fourth
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
10 1/4%  Series  due 2020  (hereinafter  called  the  bonds  of the  Forty-fifth
Series),  in the aggregate  principal amount of One Hundred  Twenty-five Million
Dollars ($125,000,000); bonds of a series entitled and designated First Mortgage
Bonds,  9-1/2% Series due 2021 (hereinafter  called the bonds of the Forty-sixth
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
9% Series due 2021 (hereinafter  called the bonds of the Forty-seventh  Series),
in  the  aggregate  principal  amount  of  One  Hundred  Fifty  Million  Dollars
($150,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
7-1/8% Series due 1997, in the aggregate  principal  amount of One Hundred Fifty
Million  Dollars  ($150,000,000),  and bonds of a series entitled and designated
First Mortgage Bonds,  8-3/4% Series due 2024, in the aggregate principal amount
of  One  Hundred  Seventy-five  Million  Dollars   ($175,000,000)   (hereinafter
collectively  called the bonds of the  Forty-eighth  Series);  bonds of a series
entitled and  designated  First Mortgage  Bonds,  7-5/8% Series due 1998, in the
aggregate  principal amount of One Hundred Million Dollars  ($100,000,000),  and
bonds of a series entitled and designated  First Mortgage  Bonds,  8-1/8% Series
due 2002, in the aggregate  principal amount of One Hundred  Twenty-five Million
Dollars  ($125,000,000)  (hereinafter  collectively  called  the  bonds  of  the
Forty-ninth  Series);  bonds of a series entitled and designated  First Mortgage
Bonds,  7-5/8%  Series due 1999  (hereinafter  called the bonds of the  Fiftieth
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
8% Series due 2025 (hereinafter called the bonds of the Fifty-first  Series), in
the  aggregate   principal   amount  of  One  Hundred   Fifty  Million   Dollars
($150,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
7-1/4%  Series  due 2023  (hereinafter  called  the  bonds  of the  Fifty-second
Series),  in the  aggregate  principal  amount of One  Hundred  Million  Dollars
($100,000,000);  bonds of a series entitled and designated First Mortgage Bonds,
5-7/8% Series due 2028 (hereinafter called bonds of the Fifty-third  Series), in
the aggregate  principal  amount of Twelve  Million Eight Hundred Fifty Thousand
Dollars ($12,850,000);  bonds of a series entitled and designated First Mortgage
Bonds,  5-7/8%  Series due 2028  (hereinafter  called bonds of the  Fifty-fourth
Series),  in the aggregate principal amount of One Hundred Forty-one Million One
Hundred Fifty Thousand  Dollars  ($141,150,000);  bonds of a series entitled and
designated  First Mortgage  Bonds,  5-1/2% Series due 2028  (hereinafter  called
bonds  of  the  Fifty-fifth  Series),  in  the  aggregate  principal  amount  of
Twenty-five  Million  Dollars  ($25,000,000);  bonds  of a series  entitled  and
designated  First Mortgage  Bonds,  5-3/4% Series due 2000  (hereinafter  called

                                       5
<PAGE>
bonds of the  Fifty-sixth  Series)  in the  aggregate  principal  amount  of One
Hundred  Million  Dollars  ($100,000,000);   bonds  of  a  series  entitled  and
designated  First Mortgage  Bonds,  6-5/8% Series due 2004  (hereinafter  called
bonds of the  Fifty-seventh  Series) in the  aggregate  principal  amount of One
Hundred  Million  Dollars  ($100,000,000);   bonds  of  a  series  entitled  and
designated First Mortgage Bonds,  Senior Note Series A (hereinafter called bonds
of the  Fifty-eighth  Series) in the aggregate  principal  amount of One Hundred
Million  Dollars  ($100,000,000);  and bonds of a series entitled and designated
First  Mortgage  Bonds,  Senior Note Series B  (hereinafter  called bonds of the
Fifth-ninth  Series) in the aggregate  principal amount of Fifty Million Dollars
($50,000,000); and

     WHEREAS, said The Bank of New York, by an instrument in writing,  effective
on the opening of business on September  29, 1995,  succeeded to Bank of America
National  Trust and Savings  Association  as Trustee  under the  Mortgage;  and,
pursuant to Section 104 of the  Mortgage,  The Bank of New York is the successor
Trustee under the Mortgage; and

     WHEREAS, Section 8 of the Mortgage provides that the form of each series of
bonds  (other  than  bonds  of the  First  Series)  issued  thereunder  shall be
established  by Resolution of the Board of Directors of the Company and that the
form of each series,  as established  by said Board of Directors,  shall specify
the descriptive title of the bonds and various other terms thereof, and may also
contain such provisions not inconsistent  with the provisions of the Mortgage as
the Board of  Directors  may, in its  discretion,  cause to be inserted  therein
expressing or referring to the terms and conditions upon which such bonds are to
be issued and/or secured under the Mortgage; and

     WHEREAS, Section 120 of the Mortgage provides, among other things, that any
power,  privilege  or right  expressly  or  impliedly  reserved to or in any way
conferred upon the Company by any provision of the Mortgage, whether such power,
privilege or right is in any way restricted or is unrestricted,  may be in whole
or in part waived or surrendered or subjected to any  restriction if at the time
unrestricted or to additional restriction if already restricted, and the Company
may enter  into any  further  covenants,  limitations  or  restrictions  for the
benefit of any one or more series of bonds issued thereunder, or the Company may
cure any ambiguity contained therein, or in any supplemental  indenture,  or may
establish the terms and  provisions of any series of bonds other than said First
Series,  by an instrument in writing executed and acknowledged by the Company in
such  manner as would be  necessary  to entitle a  conveyance  of real estate to
record in all of the  states in which any  property  at the time  subject to the
Lien of the Mortgage shall be situated; and

     WHEREAS,  the  Company  now  desires  to create a new series of bonds to be
issued under and pursuant to the Mortgage in accordance  with the  provisions of
Article VI thereof,  and to add to its covenants and agreements contained in the
Mortgage,  as heretofore  supplemented and amended,  certain other covenants and
agreements  to be observed by it and to alter and amend in certain  respects the
covenants and provisions contained in the Mortgage,  as heretofore  supplemented
and amended; and

     WHEREAS,  the  Company  has  entered  into a Loan  Agreement,  dated  as of
November 1, 2002 (as amended from time to time,  the "Loan  Agreement")  between
the Company and Maricopa  County,  Arizona  Pollution  Control  Corporation (the
"Issuer"),  and the Issuer has issued the  Maricopa  County,  Arizona  Pollution
Control  Corporation  Pollution  Control Revenue Refunding Bonds (Arizona Public
Service  Company Palo Verde  Project) 2002 Series A in the  aggregate  principal
amount of  $90,000,000  (the  "Series A  Pollution  Control  Bonds")  under that
certain  Indenture of Trust,  dated as of November 1, 2002 (as amended from time
to time, the "Maricopa  Indenture") between the Issuer and The Bank of New York,
as  Trustee  (together  with its  successors  in such  capacity,  the  "Maricopa
Trustee");

     WHEREAS,  the Company has agreed to issue Ninety Million  ($90,000,000)  in
aggregate  principal  amount of its 5.05% Senior Notes  (Maricopa 2002 Series A)
due 2029 (the  "Series A Senior  Notes") in  support  of the Series A  Pollution

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<PAGE>
Control Bonds,  pursuant to the provisions of the Indenture dated as of November
15, 1996 (the "Senior Note Indenture"),  between the Company and The Bank of New
York, as trustee  (said  trustee or any successor  trustee under the Senior Note
Indenture  being  hereinafter  referred to as the  "Senior  Note  Trustee"),  as
supplemented by the First Supplemental Indenture, dated as of November 15, 1996,
the  Second  Supplemental  Indenture  dated as of April 1,  1997,  and the Third
Supplemental Indenture dated as of November 1, 2002, between the Company and the
Senior Note Trustee; and

     WHEREAS,  in order to secure the Company's  obligation to pay principal and
interest on the Series A Senior Notes prior to the Release Date (as  hereinafter
defined),  the Company desires to provide for the issuance under the Mortgage to
the Senior  Note  Trustee of a new series of bonds  designated  "First  Mortgage
Bonds, Senior Note Series C," having the same rate of interest, interest payment
dates,  maturity  date  and  redemption  provisions  and in the  same  aggregate
principal amount as the Series A Senior Notes; and

     WHEREAS,  the  execution  and  delivery by the Company of this  Fifty-sixth
Supplemental  Indenture,  and the  terms  of the  bonds of the  Sixtieth  Series
hereinafter  referred to, have been duly authorized by the Board of Directors of
the Company by appropriate Resolutions of said Board of Directors;

     NOW  THEREFORE,  THIS  INDENTURE  WITNESSETH:  That Arizona  Public Service
Company,  in  consideration of the premises and of One Dollar to it duly paid by
the  Trustee at or before the  ensealing  and  delivery of these  presents,  the
receipt whereof is hereby acknowledged,  and in further evidence of assurance of
the estate,  title and rights of the Trustee and in order  further to secure the
payment of both the principal of and interest and premium,  if any, on the bonds
from time to time  heretofore,  herewith or hereafter issued under the Mortgage,
according to their tenor and effect,  and the  performance of all the provisions
of  the  Mortgage  (including  any  instruments  supplemental  thereto  and  any
modifications  made  as in the  Mortgage  provided)  and of said  bonds,  hereby
grants,  bargains,  sells, releases,  conveys,  assigns,  transfers,  mortgages,
pledges,  sets over and confirms (subject,  however, to Excepted Encumbrances as
defined in Section 6 of the Mortgage and to the liens permitted by Section 36 of
the Mortgage)  unto The Bank of New York, as Trustee under the Mortgage,  and to
its  successor  or  successors  in  said  trust,  and to  said  Trustee  and its
successors and assigns forever,  all the properties of the Company  described in
the Mortgage,  as heretofore  supplemented  and amended  (except any  properties
which have been released from the Lien of the Mortgage),  and all the properties
specifically described in Article V hereof.

     Also all other  property,  real,  personal and mixed, of the kind or nature
specifically  mentioned  in  Article  V hereof  or of any  other  kind or nature
(except any herein or in the Mortgage,  as heretofore  supplemented and amended,
expressly excepted and except any which may not lawfully be mortgaged or pledged
hereunder), now owned or, subject to the provisions of subsection (I) of Section
87  of  the   Mortgage,   hereafter   acquired  by  the  Company  (by  purchase,
consolidation, merger, donation, construction, erection or in any other way) and
wheresoever situated, including (without in anywise limiting or impairing by the
enumeration  of the same the scope and intent of the foregoing or of any general
description  contained in this  Fifty-sixth  Supplemental  Indenture) all lands,
power  sites,   flowage   rights,   water   rights,   water   locations,   water
appropriations,  ditches, flumes, reservoirs, reservoir sites, canals, raceways,
dams,  dam sites,  aqueducts,  and all other rights or means for  appropriating,
conveying,  storing and supplying water; all rights of way and roads; all plants
for the generation of electricity by steam,  water and/or other power; all power
houses,  gas plants,  street  lighting  systems,  standards and other  equipment
incidental thereto,  telephone,  radio and television systems,  air-conditioning
systems and equipment incidental thereto, water works, water systems, steam heat
and hot water plants,  substations,  lines, service and supply systems, bridges,
culverts, tracks, ice or refrigeration plants and equipment,  offices, buildings
and other structures and equipment  thereof;  all machinery,  engines,  boilers,
dynamos,  electric, gas and other machines,  regulators,  meters,  transformers,

                                       7
<PAGE>
generators, motors, electrical, gas and mechanical appliances, conduits, cables,
water,  steam heat,  gas or other  pipes,  gas mains and pipes,  service  pipes,
fittings,  valves and connections,  pole and transmission lines, wires,  cables,
tools, implements,  apparatus, furniture and chattels; all franchises,  consents
or permits; all lines for the transmission and distribution of electric current,
gas, steam heat or water for any purpose including towers, poles, wires, cables,
pipes,  conduits,  ducts and all apparatus for use in connection therewith;  all
real  estate,  lands,  easements,  servitudes,  licenses,  permits,  franchises,
privileges,  rights of way and other  rights in or relating to public or private
property,  real or personal,  or the  occupancy of such  property and (except as
herein or in the Mortgage,  as heretofore  supplemented  and amended,  expressly
excepted)  all the  right,  title  and  interest  the  Company  may now  have or
hereafter  acquire  in and to any  and  all  property  of  any  kind  or  nature
appertaining  to and/or used and/or  occupied  and/or enjoyed in connection with
any property  hereinbefore or in the Mortgage,  as heretofore  supplemented  and
amended, described.

     TOGETHER WITH all and singular the tenements, hereditaments, prescriptions,
servitudes  and  appurtenances  belonging  or in  anywise  appertaining  to  the
aforementioned  property or any part thereof, with the reversion and reversions,
remainder  and  remainders  and (subject to the  provisions of Section 57 of the
Mortgage) the tolls, rents,  revenues,  issues,  earnings,  income,  product and
profits  thereof,  and  all  the  estate,   right,  title,  interest  and  claim
whatsoever,  at law as well  as in  equity,  which  the  Company  now has or may
hereafter acquire in and to the aforementioned property and franchises and every
part and parcel thereof.

     IT IS HEREBY  AGREED by the  Company  that,  subject to the  provisions  of
subsection (I) of Section 87 of the Mortgage and to the extent permitted by law,
all the property,  rights and  franchises  acquired by the Company (by purchase,
consolidation,  merger,  donation,  construction,  erection or in any other way)
after the date  hereof,  except any  herein or in the  Mortgage,  as  heretofore
supplemented and amended,  expressly excepted, shall be and are as fully granted
and conveyed hereby and as fully embraced within the lien hereof and the Lien of
the Mortgage as if such property,  rights and  franchises  were now owned by the
Company and were specifically described herein and conveyed hereby.

     PROVIDED  that  the  following  are not and are not  intended  to be now or
hereafter granted, bargained, sold, released, conveyed,  assigned,  transferred,
mortgaged,  pledged,  set over or confirmed  hereunder and are hereby  expressly
excepted from the lien and operation of this Fifty-sixth  Supplemental Indenture
and from the Lien and  operation  of the  Mortgage,  viz.:  (1) cash,  shares of
stock,  bonds,  notes and other  obligations and other  securities not hereafter
specifically pledged,  paid, deposited,  delivered or held under the Mortgage or
covenanted  so to  be;  (2)  merchandise,  equipment,  apparatus,  materials  or
supplies held for the purpose of sale or other  disposition  in the usual course
of business;  fuel,  oil and similar  materials  and supplies  consumable in the
operation  of any of the  properties  of  the  Company;  construction  equipment
acquired for  temporary  use; all aircraft,  tractors,  rolling  stock,  trolley
coaches, buses, motor coaches, automobiles,  motor trucks and other vehicles and
materials  and supplies held for the purpose of repairing or replacing (in whole
or part) any of the same; all timber, minerals, mineral rights and royalties and
all  Natural  Gas and Oil  Production  Property,  as defined in Section 4 of the
Mortgage;  (3) bills,  notes and  accounts  receivable,  judgments,  demands and
chooses in  action,  and all  contracts,  leases and  operating  agreements  not
specifically pledged under the Mortgage or covenanted so to be; (4) the last day
of the term of any lease or leasehold which may be or become subject to the Lien
of the Mortgage;  (5) electric  energy,  gas, steam,  ice and other materials or
products generated, manufactured, produced, purchased or acquired by the Company
for sale,  distribution or use in the ordinary  course of its business;  and (6)
the  Company's  franchise  to be a  corporation;  PROVIDED,  HOWEVER,  that  the
property  and  rights  expressly  excepted  from the Lien and  operation  of the
Mortgage in the above subdivisions (2) and (3) shall (to the extent permitted by
law) cease to be so excepted in the event and as of the date that the Trustee or
a receiver or trustee shall enter upon and take  possession of the Mortgaged and

                                       8
<PAGE>
Pledged  Property  in the manner  provided  in Article  XIII of the  Mortgage by
reason of the occurrence of a Default as defined in Section 65 thereof.

     TO HAVE AND TO HOLD all such properties, real, personal and mixed, granted,
bargained, sold, released, conveyed, assigned, transferred,  mortgaged, pledged,
set over or  confirmed by the Company as  aforesaid,  or intended so to be, unto
The Bank of New York, the Trustee, and its successors and assigns forever.

     IN TRUST  NEVERTHELESS,  for the  same  purposes  and upon the same  terms,
trusts and conditions and subject to and with the same provisos and covenants as
are set forth in the Mortgage, as supplemented and amended.

     AND IT IS HEREBY COVENANTED by the Company that all the terms,  conditions,
provisos,  covenants and provisions  contained in the Mortgage,  as supplemented
and amended,  shall affect and apply to the property hereinbefore  described and
conveyed and to the estate,  rights,  obligations  and duties of the Company and
the Trustee and the  beneficiaries  of the trust with respect to said  property,
and to the Trustee and its  successors  as Trustee of said  property in the same
manner and with the same  effect as if the said  property  had been owned by the
Company at the time of the  execution of the Mortgage and had been  specifically
and at length  described  in and  conveyed to said  Trustee by the Mortgage as a
part of the property therein stated to be conveyed.

     The Company  further  covenants  and agrees to and with the Trustee and its
successors in said trust under the Mortgage, as follows:

                                   ARTICLE I.
                            SIXTIETH SERIES OF BONDS.

     SECTION  1. There  shall be a series of bonds  designated  "First  Mortgage
Bonds, Senior Note Series C" (hereinafter sometimes referred to as the "Sixtieth
Series" or the "Senior Note Series C Bonds"), limited to the aggregate principal
amount of $90,000,000, each of which shall also bear the descriptive title First
Mortgage Bond, and the form thereof, which shall be established by Resolution of
the Board of Directors of the Company,  shall contain  suitable  provisions with
respect to the matters  hereinafter  specified in this  Supplemental  Indenture.
Bonds of the  Sixtieth  Series  shall be dated as  provided in Section 10 of the
Mortgage;   shall  mature,  subject  to  the  provisions  for  prior  redemption
hereinafter  set  forth,  on May 1,  2029;  shall be  issued  as a single  fully
registered bond, and shall be registered in the name of the Senior Note Trustee;
and shall bear interest  from November 1, 2002 or from the most recent  Interest
Payment Date (as defined  below) to which  interest has been paid at the rate of
5.05% per annum  (calculated  on the  basis of a 360-day  year of twelve  30-day
months), payable on May 1 and November 1 of each year (each an "Interest Payment
Date"), commencing May 1, 2003, to the holders thereof of record on the April 15
or October 15, as the case may be, next  preceding  such  Interest  Payment Date
(subject  to the  provisions  of Section  12 of the  Mortgage  concerning  legal
holidays  and bank  closings),  and the  principal  of and interest on, or other
amounts, if any, payable upon redemption of, each said bond to be payable at the
office or agency of the  Company in the  Borough of  Manhattan,  The City of New
York,  New York, in such coin or currency of the United States of America as, at
the time of payment, is legal tender for public and private debts.

     Notwithstanding  the above,  to the extent  required  in Section 4.2 of the
Loan Agreement at any time, all payments of interest on an Interest Payment Date
and of principal on the maturity  date of the Senior Note Series C Bonds will be
due and payable not less than two (2) Business  Days (as defined in the Maricopa
Indenture) prior to each such Interest Payment Date and such maturity date.

                                       9
<PAGE>
     The Company  shall have no  obligation to make payments with respect to the
principal  and/or  interest on the Senior Note Series C Bonds  unless and until,
and only to the extent that,  payments shall be due and payable  pursuant to the
Series A Senior  Notes,  and the  Company's  obligation  to make  payments  with
respect to the principal and/or interest on the Senior Note Series C Bonds shall
be fully or  partially,  as the case may be,  satisfied  and  discharged  to the
extent that, at the time that any such payment  shall be due, the  corresponding
amount of  principal  of and/or  interest  then due on the Series A Senior Notes
shall have been fully or partially paid, as the case may be, or there shall have
been  deposited  with the Senior Note Trustee  pursuant to Section 501,  Section
1103, or Section 1205 of the Senior Note Indenture trust funds  sufficient under
the  provisions of said Sections to fully or partially  pay, as the case may be,
the  corresponding  amount of principal and/or interest then due on the Series A
Senior Notes.

     SECTION 2. Upon payment of the  principal of and interest due on the Series
A Senior  Notes,  whether at  maturity or prior to  maturity  by  redemption  or
otherwise,  or upon  provision  for the  payment  thereof  having  been  made in
accordance with Section 501 or Section 1402 of the Senior Note Indenture, Senior
Note  Series C Bonds in a  principal  amount  equal to the  principal  amount of
Series A Senior Notes so paid or for which such  provision  for payment has been
made shall be deemed fully paid, satisfied and discharged and the obligations of
the Company  thereunder  shall be terminated and such Senior Note Series C Bonds
shall be surrendered  to and cancelled by the Trustee.  From and after such date
as all bonds issued under the  Mortgage  (other than Senior Note First  Mortgage
Bonds,  as such term is defined in the Senior Note  Indenture) have been retired
through payment,  redemption,  or otherwise at, before or after maturity thereof
(the "Release Date"), the Senior Note Series C Bonds shall be deemed fully paid,
satisfied and discharged and the obligation of the Company  thereunder  shall be
terminated. On the Release Date, subject to the conditions of Section 407 of the
Senior Note  Indenture,  the Senior Note Series C Bonds shall be  surrendered to
and cancelled by the Trustee.

     SECTION 3. Bonds of the  Sixtieth  Series  shall be held by the Senior Note
Trustee and shall not be  transferable  except to its permitted  successors  and
assigns.  The Senior  Note  Trustee,  as the holder of the Senior  Note Series C
Bonds,  shall attend  meetings of bondholders  under the Mortgage or deliver its
proxy in connection  therewith.  Either at such meeting,  or otherwise  when the
consent of the  holders of the Senior  Note  Series C Bonds is sought  without a
meeting,  the Senior  Note  Trustee  shall vote as the holder of the Senior Note
Series C Bonds, or shall consent with respect thereto;  provided,  however, that
the  Senior  Note  Trustee  shall  not vote in favor  of,  or  consent  to,  any
modification  of the Mortgage  which is  correlative  to a  modification  of the
Maricopa  Indenture or the Loan  Agreement  which would  require the approval of
owners of Series A Pollution Control Bonds without the approval of the owners of
Series A Pollution  Control  Bonds which would be required for such  correlative
modification of such Maricopa Indenture or Loan Agreement.

                                   ARTICLE II.
          REDEMPTION OF SENIOR NOTE SERIES C BONDS AND OTHER PROVISIONS

     The Senior Note Series C Bonds shall be redeemed, in whole or in part, from
time to time, on the date on which a corresponding  principal amount of Series A
Senior  Notes is redeemed as  provided  in the Senior  Note  Indenture  upon the
Senior  Note  Trustee's  notification  of the Trustee of such  redemption,  at a
redemption  price equal to the  redemption  price of such Series A Senior  Notes
being so  redeemed.  Any such  notice  shall be received by the Trustee no later
than 5 days prior to any  redemption  date fixed for the  Senior  Note  Series C
Bonds to be redeemed and shall specify the principal  amount of such Senior Note
Series C Bonds to be redeemed,  the  redemption  date, and the amount of accrued
interest to be paid thereon. The Company shall deposit in trust with the Trustee
on the redemption date an amount of money sufficient to pay the principal amount
plus accrued interest, if any, on the Senior Note Series C Bonds to be redeemed.
Upon presentation to the Trustee of any Senior Note Series C Bonds by the Senior
Note Trustee for payment  under this Article II, such Senior Note Series C Bonds
so presented shall be redeemed and paid in full to the extent so redeemed.

                                       10
<PAGE>
     In the event the principal of all Series A Senior Notes is declared due and
payable or becomes  automatically due and payable pursuant to Section 602 of the
Senior Note Indenture,  upon the filing with the Trustee of a written demand for
the  acceleration of the payment of principal of all Senior Note Series C Bonds,
the  payment  of  principal  on all  Senior  Note  Series C Bonds  shall  become
immediately  due and payable and the  Trustee  shall  provide to the Senior Note
Trustee an irrevocable,  valid and  unconditional  notice of acceleration of all
Senior Note Series C Bonds.

     Redemption  of the Senior Note Series C Bonds  shall be  effected,  without
further  notice by the Company to the Trustee,  by the payment by the Company of
the  applicable  redemption  price  specified  in this  Article  II at the place
specified for payment of principal of and interest on such bonds.

     The  Senior  Note  Series C Bonds  will not be  subject  to  prepayment  or
redemption  prior to maturity  except as provided  herein,  notwithstanding  the
provisions  of Section 39 or Section 64 of the  Mortgage,  or with  "Proceeds of
Released Property," as defined in the Mortgage.

     The Senior Note Series C Bonds will not be subject to any sinking fund.

     The Company  covenants and agrees that,  prior to Release Date, it will not
take any action  (except as required by this Article II hereof) that would cause
the  outstanding  principal  amount of the Senior Note Series C Bonds to be less
than the then outstanding principal amount of the Series A Senior Notes.


                                  ARTICLE III.
             REPLACEMENT FUND PROVISIONS -- OTHER RELATED PROVISIONS
             OF THE MORTGAGE -- DIVIDEND COVENANT -- RECORD DATES --
                              AUTHENTICATING AGENT.

     SECTION 4. The Company  covenants  that the provisions of Section 39 of the
Mortgage,  which  were to  remain  in  effect  so long as any bonds of the First
Series  remained  Outstanding,  shall remain in full force and effect so long as
any bonds of the Sixtieth Series are Outstanding.

     Clause (d) of subsection  (II) of Section 4 of the Mortgage,  as heretofore
amended,  clause (6) and clause (e) of Section 5 of the Mortgage,  as heretofore
amended,  and Section 29 of the  Mortgage,  as  heretofore  amended,  are hereby
further amended by inserting  therein the words "and Sixtieth  Series" after the
words "bonds of the First  Series and Second  Series and Third Series and Fourth
Series and Fifth  Series and Sixth Series and Seventh  Series and Eighth  Series
and Ninth  Series and Tenth Series and  Eleventh  Series and Twelfth  Series and
Thirteenth  Series and  Fourteenth  Series and  Fifteenth  Series and  Sixteenth
Series and Seventeenth  Series and Eighteenth  Series and Nineteenth  Series and
Twentieth  Series  and  Twenty-first   Series  and   Twenty-second   Series  and
Twenty-third  Series  and  Twenty-fourth  Series  and  Twenty-fifth  Series  and
Twenty-sixth  Series  and  Twenty-seventh  Series and  Twenty-eighth  Series and
Twenty-ninth   Series  and  Thirtieth   Series  and   Thirty-first   Series  and
Thirty-second  Series  and  Thirty-third  Series  and  Thirty-fourth  Series and
Thirty-fifth  Series  and  Thirty-sixth  Series  and  Thirty-seventh  Series and
Thirty-eighth Series and Thirty-ninth Series and Fortieth Series and Forty-first
Series and Forty-second  Series and Forty-third  Series and Forty-fourth  Series
and  Forty-fifth  Series and  Forty-sixth  Series and  Forty-seventh  Series and
Forty-eighth  Series and Forty-ninth  Series and Fiftieth Series and Fifty-first
Series and Fifty-second  Series and Fifty-third  Series and Fifty-fourth  Series
and Fifty-fifth  Series and Fifty-sixth  Series,  and  Fifty-seventh  Series and
Fifty-eighth Series and Fifty-ninth" each time such words occur therein.

                                       11
<PAGE>
     Clause (e) of subsection  (II) of Section 4 of the Mortgage,  as heretofore
amended, is hereby further amended by the insertion therein after the words "and
Fifty-ninth" the words "and Sixtieth."

     The last  paragraph of Section 12 of the Mortgage,  as heretofore  amended,
the last paragraph of Section 17 of the Mortgage, as heretofore amended, and the
last paragraph of Section 110 of the Mortgage, as heretofore amended, are hereby
amended by inserting  therein the words "or the Sixtieth Series" after the words
"Fifty-ninth Series" each time such words occur therein.

                                   ARTICLE IV.
                            MISCELLANEOUS PROVISIONS.

     SECTION 5. The terms defined in the Mortgage,  as supplemented and amended,
shall, for all purposes of this  Fifty-sixth  Supplemental  Indenture,  have the
meanings specified therein,  except that the term "Mortgage" shall mean only the
original  Mortgage  and  Deed of  Trust,  dated  as of July 1,  1946;  the  term
"Mortgage,  as heretofore  supplemented and amended" shall mean the Mortgage, as
supplemented  and  amended  by  the  First  through   Fifty-fifth   Supplemental
Indentures hereinabove referred to; and the term "Mortgage,  as supplemented and
amended,"  shall mean the  Mortgage,  as  supplemented  and amended by the First
through  Fifty-fifth  Supplemental  Indentures  hereinabove  referred  to and as
supplemented  and amended by this  Fifty-sixth  Supplemental  Indenture  and any
future supplemental indentures.

     SECTION 6. The Trustee hereby accepts the trusts herein declared, provided,
created,  supplemented  or amended and agrees to perform the same upon the terms
and  conditions  herein and in the  Mortgage,  as  heretofore  supplemented  and
amended, set forth and upon the following terms and conditions:

     The Trustee shall not be  responsible  in any manner  whatsoever  for or in
respect  of  the  validity  or  sufficiency  of  this  Fifty-sixth  Supplemental
Indenture or for or in respect of the recitals  contained  herein,  all of which
recitals  are made by the Company  solely.  In general,  each and every term and
condition contained in Article XVII of the Mortgage shall apply to and form part
of this Fifty-sixth  Supplemental Indenture with the same force and effect as if
the same were  herein  set forth in full with  such  omissions,  variations  and
insertions,  if any,  as may be  appropriate  to make  the same  conform  to the
provisions of this Fifty-sixth Supplemental Indenture.

     SECTION 7. Whenever in this  Fifty-sixth  Supplemental  Indenture either of
the  parties  hereto  is  named or  referred  to,  this  shall,  subject  to the
provisions  of Articles XVI and XVII of the  Mortgage,  be deemed to include the
successors  and assigns of such party,  and all the covenants and  agreements in
this Fifty-sixth Supplemental Indenture contained by or on behalf of the Company
or by or on behalf of the Trustee shall, subject as aforesaid, bind and inure to
the  respective  benefits  of the  respective  successors  and  assigns  of such
parties, whether so expressed or not.

     SECTION 8. Nothing in this Fifty-sixth Supplemental Indenture, expressed or
implied,  is intended or shall be construed  to confer upon,  or to give to, any
person,  firm or  corporation,  other than the parties hereto and the holders of
the bonds Outstanding under the Mortgage, any right, remedy or claim under or by
reason of this Fifty-sixth  Supplemental  Indenture or any covenant,  condition,
stipulation,  promise or agreement  hereof,  and all the covenants,  conditions,
stipulations, promises and agreements in this Fifty-sixth Supplemental Indenture
contained  by or on behalf of the  Company  shall be for the sole and  exclusive
benefit of the parties hereto and of the holders of the bonds  Outstanding under
the Mortgage.

                                       12
<PAGE>
     SECTION  9.  This  Fifty-sixth   Supplemental  Indenture  may  be  executed
simultaneously in several  counterparts,  each of which shall be an original and
all of which shall constitute but one and the same instrument.

                                   ARTICLE V.
                        SPECIFIC DESCRIPTION OF PROPERTY.

     SECTION 10. CERTAIN REAL PROPERTY LOCATED IN:

                                  APACHE COUNTY

                            EAST HOLBROOK SUBSTATION

PARCEL NO. 1:

That certain  parcel of land  situated in the  Southwest  quarter of Section 20,
Township 19 North,  Range 24 East of the Gila and Salt River Base and  Meridian,
Apache County, Arizona, being more particularly described as follows:

COMMENCING  at the axle that  marks the  Southwest  corner of Section  20,  from
whence the axle that marks the West quarter  corner of Section 20 bears North 00
degrees 18 minutes 08 seconds West, a distance of 2639.33 feet;

thence  North 00 degrees 08 minutes 18 seconds  West along the West line of said
Section 20, a distance of 2087.82 feet;

thence  departing  the West  Section  line on a bearing  of South 89  degrees 34
minutes  38  seconds  East,  a  distance  of  328.67  feet to the TRUE  POINT OF
BEGINNING;

thence continuing on a bearing of South 89 degrees 34 minutes 38 seconds East, a
distance of 250.00 feet;

thence South 00 degrees 25 minutes 22 seconds West, a distance of 250.00 feet;

thence North 89 degrees 34 minutes 38 seconds West, a distance of 250.00 feet;

thence North 00 degrees 25 minutes 22 seconds East, a distance of 250.00 feet to
the TRUE POINT OF BEGINNING.

                                 COCONINO COUNTY

                               RED LAKE SUBSTATION

The  following  described  land  situate in Coconino  County,  Arizona,  being a
portion of the Southwest Quarter of Section 15, Township 23 North,  Range 2 East
of the Gila and Salt River Base and  Meridian,  more  particularly  described as
follows:

COMMENCING  at the  "P-K"  nail in a  concrete  fence  corner  footing,  locally
accepted as the Southwest  corner of said Section 15, from whence the 1" pipe in
a stone circle that marks the South  Quarter  corner of said Section bears South
87(degree)59'34" East, 2574.88 feet distant;

                                       13
<PAGE>
THENCE North  36(degree)17'16" East, a distance of 602.19 feet to the TRUE POINT
OF BEGINNING;

THENCE North 01(degree)09'03" East, a distance of 291.53 feet;

THENCE South 88(degree)50'58" East, a distance of 300.00 feet;

THENCE South 01(degree)09'03" West, a distance of 300.00 feet;

THENCE North 88(degree)50'58" West, a distance of 249.94 feet;

THENCE North  79(degree)14'50"  West, a distance of 50.77 feet to the TRUE POINT
OF BEGINNING.

TOGETHER WITH a release,  transfer and quit-claim of all right, title, privilege
and claim of Grantor in and to all minerals  (surface and subsurface)  which may
be owned by him and which are appurtenant to the aforedescribed lands.

TOGETHER with all improvements thereon located.

                                 MARICOPA COUNTY

                              ALEXANDER SUBSTATION

A portion of the South half of Section 25, Township 3 North,  Range 2 East, Gila
and Salt River Meridian,  Maricopa County,  Arizona,  lying south of the Arizona
Canal more particularly described as follows:

Commencing  at the South  Quarter  corner of said Section 25, said point being a
brass cap in  handhole,  thence  coincident  with the  mid-section  line,  North
00(degree)  29' 36" East  1666.94  feet to the True  Point of  Beginning  of the
parcel herein described.

Thence leaving said mid-section  line South  55(degree)  53'23" West 8.36' to an
iron bar with SRP cap stamped LS15925,

Thence North  38(degree)  36' 25" West 231.40 feet to the North line of a parcel
of land described in Docket 265, Page 90 Maricopa County records and an iron bar
with SRP cap stamped LS 15925,

Thence  coincident  with the North line of said Docket 265,  Page 90,  North 510
15'14"  East  125.27  feet to an iron bar with SRP cap  stamped LS 15925 and the
beginning  of an non  tangent  curve,  concave  to the South  having a radius of
380.00 feet and to which beginning a radial line bears North  27(degree) 42' 18"
West;

Thence  easterly  81.70  feet  along  said  curve  through  a  central  angle of
12(degree) 19' 08" to an iron bar with SRP cap stamped LS 15925

Thence  South.10(degree)44'  49"  East  37.36  feet to an iron  bar with SRP cap
stamped LS15925,

Thence  North  81(degree)46'  03"  East  70.88  feet to an iron bar with SRP cap
stamped LS 15925,

Thence  North  13(degree)  21' 24" West  39.83  feet to an iron bar with SRP cap
stamped LS 15925 and the beginning of a non tangent curve,  concave to the south
having a radius of 380 feet and to which  beginning  a radial  line bears  North
04(degree) 58' 04" West;

                                       14
<PAGE>
Thence  easterly  149.84  feet  along  said  curve  through a  central  angle of
22(degree) 35' 34" to an iron bar with SRP cap stamped LS15925,

Thence  South  72(degree)22'  30" East  274.22  feet to an iron bar with SRP cap
stamped LS 15925,

Thence South 53(degree)04'37" East 8.00 feet to an iron bar with SRP cap stamped
LS15925,

Thence  South  72(degree)35'  22" East  119.70  feet to an iron bar with SRP cap
stamped LS 15925,

Thence  South  61(degree)24'  41"  West  52.21  feet to an iron bar with SRP cap
stamped LS15925,

Thence  North  78(degree)18'  39"  West  75.52  feet to an iron bar with SRP cap
stamped LS15925,

Thence  South  61(degree)24'  41" West  542.37  feet to an iron bar with SRP cap
stamped LS15925,

Thence  North  00(degree)29'  36" East  129.40  feet to an iron bar with SRP cap
stamped LS15925,

Thence South 56(degree) 15' 21" West 30.24 feet to the true point of beginning.

                              ARROWHEAD SUBSTATION

PARCEL NO. 1:

That part of the Southeast quarter of Section 23, Township 4 North, Range 1 East
of the Gila and Salt River Meridian, Maricopa County, Arizona, more particularly
described as follows:

COMMENCING at the South quarter corner of said Section 23;

THENCE South 89 degrees 53 minutes 33 seconds East,  along the South line of the
Southeast quarter of said Section 23, a distance of 740.00 feet;

THENCE North 00 degrees 05 minutes 41 seconds East, departing said South line, a
distance  of 70.00 feet to the  Southwest  corner of a 20.00 foot wide  Electric
Utility Easement, recorded in Document No. 94-0809353, Maricopa County Records;

THENCE  North 89 degrees 53 minutes 33 seconds  West,  a distance of 120.00 feet
the True Point of Beginning;

THENCE  continuing  North 89 degrees 53 minutes 33 seconds  West,  a distance of
250.00 feet;

THENCE North 00 degrees 05 minutes 41 seconds East, a distance of 250.00 feet;

THENCE South 89 degrees 53 minutes 33 seconds East, a distance of 250.00 feet;

THENCE South 00 degrees 05 minutes 41 seconds West, a distance of 250.00 feet to
the True Point of Beginning.

PARCEL NO. 2:

A 20.00 foot Electric Utility Easement  (Extension) over the following described
property:

                                       15
<PAGE>
That part of the Southeast quarter of Section 23, Township 4 North, Range 1 East
of the Gila and Salt River Meridian, Maricopa County, Arizona, more particularly
described as follows:

COMMENCING at the South quarter corner of said Section 23;

THENCE south 89 degrees 53 minutes 33 seconds East,  along the South line of the
Southeast quarter of said Section 23, a distance of 740.00 feet;

THENCE North 00 degrees 05 minutes 41 seconds East, departing said South line, a
distance  of 70.00 feet to the  Southwest  corner of a 20.00 foot wide  Electric
Utility Easement, recorded in Document No. 94-0809353,  Maricopa County Records,
said point being the True Point of Beginning;

THENCE North 89 degrees 53 minutes 33 seconds West, a distance of 120.00 feet to
the  Southeast  corner of the  proposed  boundary of an Arizona  Public  Service
Sub-station site;

THENCE North 00 degrees 05 minutes 41 seconds  East,  along the East boundary of
said Sub-station site, a distance of 20.00 feet;

THENCE  South 89 degrees 53 minutes 33 seconds  East,  departing  said  proposed
boundary,  a distance of 120.00 feet to the  Northwest  corner of said  Electric
Utility Easement;

THENCE South 00 degrees 05 minutes 41 seconds  West,  along the West boundary of
said Electric  Utility  Easement,  a distance of 20.00 feet to the True Point of
Beginning.

PARCEL NO. 3:

A 20.00 foot Ingress and Egress Easement over the following described property;

That part of the Southeast quarter of Section 23, Township 4 North, Range 1 East
of the Gila and Salt River Meridian, Maricopa County, Arizona, more particularly
described as follows:

A 20.00 foot  easement  being  10.00 feet each side of the  following  described
centerline;

COMMENCING at the Southeast corner of said Section 23;

THENCE North 00 degrees 18 minutes 23 seconds  East,  along the East line of the
Southeast quarter of said Section 23, a distance of 1,571.94 feet;

THENCE North 89 degrees 41 minutes 37 seconds  West, a distance of 55.00 feet to
a point on the Westerly right of way of "75th Avenue," said point being the True
Point of Beginning;

THENCE  continuing  North 89 degrees 41 minutes 37 seconds West,  departing said
Westerly  right-of-way,  a distance of 168.09 feet to the beginning of a tangent
curve of 50.00 foot radius, concave Southeasterly;

THENCE  Southwesterly,  along said curve, through a central angle of 103 degrees
43 minutes 28 seconds,  a distance of 90.52 feet to the  beginning  of a tangent
compound curve of 1,682.00 foot radius, concave Northeasterly;

THENCE Southeasterly, along said curve, through a central angle of 05 degrees 51
minutes 26  seconds,  a distance of 171.94  feet to the  beginning  of a tangent
reverse curve of 604.00 foot radius, concave Northwesterly;

                                       16
<PAGE>
THENCE  Southwesterly,  along said curve, through a central angle of 125 degrees
23 minutes 38 seconds, a distance of 1,321.88 feet to the beginning of a tangent
reverse curve of 1,650.00 foot radius, concave Southwesterly;

THENCE Northwesterly, along said curve, through a central angle of 31 degrees 26
minutes 46  seconds,  a distance of 905.58  feet to the  beginning  of a tangent
reverse curve of 285.00 foot radius, concave Northeasterly;

THENCE Northwesterly, along said curve, through a central angle of 44 degrees 14
minutes 21  seconds,  a distance of 220.05  feet to the  beginning  of a tangent
reverse curve of 95.00 foot radius, concave Southeasterly;

THENCE Southwesterly, along said curve, through a central angle of 76 degrees 39
minutes 20 seconds, a distance of 127.10 feet;

THENCE South 43 degrees 15 minutes 22 seconds  West, a distance of 74.02 feet to
the beginning of a tangent curve of 62.50 foot radius, concave Southeasterly;

THENCE Southwesterly, along said curve, through a central angle of 42 degrees 15
minutes 22 seconds, a distance of 46.09 feet;

THENCE South 00 degrees 00 minutes 00 seconds East, a distance of 158.20 feet to
a point on the proposed North boundary of an Arizona Public Service  Sub-station
site, said point being the terminus of said easement.

                            BISCUIT FLATS SUBSTATION

That portion of the South half of Section 26, Township 5 North,  Range 2 East of
the Gila and Salt River Base and Meridian,  Maricopa County, Arizona,  described
as follows:

Commencing  at a point on the  North-South  mid-section  line of said Section 26
that lies North 00 degrees 01 minutes 41 seconds  East record  (North 00 degrees
01 minutes 31 seconds  East  measured),  a distance of 1671.16  record  (1671.14
measured) feet from the South quarter corner of said Section 26;

thence  departing said  mid-section  line South 89 degrees 39 minutes 32 seconds
West and parallel to the South line of the Southwest quarter of said Section 26,
a distance of 869.84 record  (868.38  measured)  feet to the  Southerly  line of
Tract No. GR-10-6 in the Central Arizona Project Canal Right-of-Way as described
in Docket 11522, page 436, records of said county;

thence North 44 degrees 27 minutes 45 seconds  East record  (North 44 degrees 27
minutes 48 seconds East  measured)  along said Southerly line 203.94 feet to the
True Point of Beginning;

thence  continuing  North 44 degrees 27 minutes 45 seconds East record (North 44
degrees 27 minutes 48 seconds East  measured)  along said  Southerly  line 89.91
feet to the  beginning of a curve  concave to the  Southeast  having a radius of
1282.14 feet;

thence  Northeasterly along said curve and said Southerly line through a central
angle of 14  degrees 48  minutes  56  seconds  record (14  degrees 49 minutes 17
seconds measured), an arc distance of 331.54 record (331.67 measured) feet;

                                       17
<PAGE>
thence  departing  said  Southerly  line  North 80 degrees 04 minutes 45 seconds
record  (North 80  degrees 04 minutes  28  seconds  East  measured),  along said
Southerly  boundary of Tract No.  GR-10-6A of the Central  Arizona Project Canal
Right-of-Way  as described in Docket  11827,  page 1263,  records of said county
670.13 record (668.89  measured)  feet, more or less, to a point on the Westerly
right-of-way of Interstate 17 according to Book 542 of Deeds,  page 471, records
of said county;

thence South 09 degrees 55 minutes 45 seconds  East record  (South 09 degrees 55
minutes 32 seconds East measured),  along said right-of-way a distance of 278.16
feet;

thence departing said right-of-way  South 83 degrees 55 minutes 20 seconds West,
a distance of 1035.80 feet to the True Point of Beginning.

                               BUCKEYE SUBSTATION

That portion of the  Southeast  quarter of the  Southeast  quarter of Section 7,
Township 1 North,  Range 3 West of the Gila and Salt  River  Base and  Meridian,
Maricopa County, Arizona, lying South of the following described line:

BEGINNING at a point on the East line of said Section 7, which point bears North
0 degrees  31  minutes  52  seconds  East,  690 feet from the  Southeast  corner
thereof;

thence  North 82 degrees 35 minutes 18 seconds West 2317.38 feet to the Point of
Ending;

EXCEPT the following described part of said Section 7:

BEGINNING at a point on the South line of the Southeast  quarter 430.8 feet West
of the Southeast corner;

thence Northerly, parallel to the East line of the Southeast quarter 315.5 feet;

thence Easterly, parallel to the South line of the Southeast quarter, 160 feet;

thence Northerly, parallel to the East line, 400 feet;

thence Westerly, parallel to the South line, 400 feet;

thence Southerly parallel to the East line, 400 feet;

thence Easterly, parallel to the South line, 140 feet;

thence Southerly, parallel to the East line, 315.5 feet;

thence Easterly, along the South line, 100 feet to the Point of Beginning.

                                COLTER SUBSTATION

PARCEL NO. 1:

That part of the  Southwest  quarter of the  Southwest  quarter  of Section  24,
Township 2 North,  Range 1 West of the Gila and Salt  River  Base and  Meridian,
Maricopa County, Arizona, described as follows:

COMMENCING at the Southwest corner of said Section 24;

                                       18
<PAGE>
Thence  North 00 degrees 12 minutes 23 seconds  West along the West line of said
Section 24, a distance of 950.24 feet to the North line of the South 950.00 feet
of said Southwest quarter of the Southwest quarter of Section 24;

Thence  South 88 degrees 55 minutes  39 seconds  East along said North  line,  a
distance  of 55.01  feet to a point on a line which is  parallel  with and 55.00
feet East of the said West line of Section  24,  said point being the TRUE POINT
OF BEGINNING;

Thence  North 00 degrees 12 minutes 23 seconds  West along said  parallel  line,
273.78 feet;

Thence South 89 degrees 03 minutes 57 seconds East, 26.19 feet;

Thence North 00 degrees 12 minutes 23 seconds  West,  18.13 feet to a point on a
line that is  parallel  with and  60.00  feet  South of the  North  line of said
Southwest quarter of the Southwest quarter of Section 24;

Thence  South 89 degrees 03 minutes 57 seconds  East along said  parallel  line,
343.88 feet to the East line of the West 425.00 feet of said  Southwest  quarter
of the Southwest quarter of Section 24;

Thence South 00 degrees 12 minutes 23 seconds East along said East line,  292.80
feet to the said North line of the South 950.00 feet of the Southwest quarter of
the Southwest quarter of Section 24;

Thence North 88 degrees 55 minutes 39 seconds West along said line,  370.09 feet
to the TRUE POINT OF BEGINNING.

PARCEL NO. 2:

An  easement  for  ingress  and egress as set forth in  instruments  recorded in
Document No. 89222578 and in Document No. 92545550  records of Maricopa  County,
Arizona, over the following described property:

That part of the  Southwest  quarter of the  Southwest  quarter  of Section  24,
Township 2 North,  Range 1 West of the Gila and Salt  River  Base and  Meridian,
Maricopa County, Arizona, more particularly described as follows:

COMMENCING at the Southwest corner of said Section 24;

Thence North 00 degrees 12 minutes 23 seconds West,  along the West line of said
Section,  1302.02 feet to a point on the North line of said Southwest quarter of
the Southwest quarter of Section 24;

Thence South 89 degrees 03 minutes 57 seconds East along said North line,  55.01
feet to a point on a line which is parallel with and 55.00 feet East of the said
West line of said Section 24, said point being the TRUE POINT OF BEGINNING;

Thence  South 89 degrees 03 minutes  57  seconds  East,  along said North  line,
370.08 feet;

Thence South 00 degrees 12 minutes 23 seconds East, 60.01 feet, said point being
on a line that is  parallel  with and 60.00 feet South of the North line of said
Southwest quarter of the Southwest quarter of Section 24;

Thence North 89 degrees 03 minutes 57 seconds  West,  along said  parallel  line
370.08  feet,  to a point being on a line that is  parallel  with and 55.00 feet
East of the West line of said Section 24;

                                       19
<PAGE>
Thence  North 00 degrees 12 minutes 23 seconds West along said  parallel  line a
distance of 60.01 feet to the TRUE POINT OF BEGINNING.

                               DOWNING SUBSTATION

A portion of Tract 21 of State Plat No. 16,  core  South,  recorded in Book 324,
Page 50 of Maps,  Maricopa  County  Recorders  Office in Section 36,  Township 4
North, Range 4 East, Gila and Salt River Meridian, Maricopa County, Arizona, and
being more  particularly  described as follows:  Commencing  at the East quarter
corner of said Section 36, from whence the  Northeast  corner of said Section 36
bears N00(degree)01'37"W,  (basis of bearings), a distance of 2640.50 ft; thence
N00(degree)01'37"W, along the east line of said Section 36, a distance of 847.91
ft;  thence  N36(degree)08'59"W,  a  distance  of 728.73 ft to the true point of
beginning;  thence  continuing  N36  '08'59"W,  a distance of 400.00 ft;  thence
S53(degree)51'01  "W, a distance  of 300.00  ft;  thence  S36(degree)08'59"E,  a
distance of 400.00 ft;  thence  N53(degree)51'01  "E, a distance of 300.00 ft to
the true point of beginning.

Total 2.75 acres more or less.

                               FLYING E SUBSTATION

A portion of the Southwest quarter of Section 9, Township 7 North,  Range 5 West
of the Gila and Salt River Meridian, Maricopa County, Arizona, more particularly
described as follows:

Commencing at the Center of Section 9-(2 inch aluminum cap RLS 24514);

THENCE  North 89 degrees 54 minutes 33 seconds  West along the North line of the
Southwest  quarter of said Section 9 a distance of 880.72 feet to the True Point
of Beginning of said Parcel;

THENCE  continuing  North 89 degrees  54 minutes 33 second  West along the North
line of the Southwest quarter of said Section 9 a distance of 400.00 feet;

THENCE  South 00 degrees 03 minutes 56 seconds West a distance of 278.70 feet to
a point on the Northerly Right of Way of U.S. Highway 60;

THENCE South 89 degrees 15 minutes 50 seconds East along the Northerly  Right of
Way. of U.S. Highway 60 a distance of 400.00 feet;

THENCE  North 00 degrees 04 minutes 16 seconds East a distance of 283.21 feet to
the True Point Beginning.

                               HATFIELD SUBSTATION

The South 330 feet of the West half of the  Southwest  quarter of the  Northwest
quarter of the Northeast quarter of Section 8, Township 4 North, Range 1 East of
the Gila and Salt River Base and Meridian, Maricopa County, AZ.

                           HEDGEPATH HILLS SUBSTATION

The North half of Lot 2, Section 7,  Township 4 North,  Range 2 East of the Gila
and Salt River Base and Meridian,  Maricopa  County,  Arizona;

EXCEPT that part lying North of the following described line:

                                       20
<PAGE>
BEGINNING at a point on the West line of said Lot 2 which bears South 00 degrees
10 minutes  East a distance of 446.24 feet from the  Northwest  corner  thereof;
thence North 86 degrees 04 minutes East a distance of 1026.53 feet to a point on
the East line of said Lot 2 which  bears  South 00 degrees 11  minutes  East,  a
distance of 383.93 feet from the Northeast corner thereof.

                             MISTY WILLOW SUBSTATION

The South 290 feet of the East 290 feet of the  Northwest  quarter of Section 8,
Township 4 North,  Range 3 East of the Gila and Salt  River  Base and  Meridian,
Maricopa County, Arizona;

Except the East 40 feet; and

Except the South 40 feet; and

Except an undivided 1/16 of all oil, gases,  and other  hydrocarbon  substances,
coal,  stone,  metals,  minerals,  fossils  and  fertilizer  of  every  name and
description and except all uranium,  thorium,  or any other material which is or
may be  determined  by the laws of the State of  Arizona,  the United  States of
America, or decisions of courts to be peculiarly  essential to the production of
fissionable  materials,  whether or not of  commercial  value,  as  reserved  in
Section 37-231 Arizona Revised Statutes

                              NEW RIVER SUBSTATION

The South 120 feet of the North half of Lot 4, of Section 26,  Township 7 North,
Range 2 East,  of the Gila and Salt River Base and  Meridian,  Maricopa  County,
Arizona;

EXCEPT all coal,  oil,  gas,  and other  mineral  deposits as reserved  unto the
United States of America in the Patent of said land.

                                STOUT SUBSTATION

Being a portion of the South three quarters of the West half of the West half of
the Southwest  quarter of the Northeast quarter of Section 12, Township 4 North,
Range 2 East of the Gila and Salt  River  Base and  Meridian,  Maricopa  County,
Arizona, being more particularly described as follows:

COMMENCING at the Northwest corner of said Southwest quarter;

Thence  South 00 degrees 07 minutes 32 seconds  East along the West line of said
West half 331.46 feet to a point on the North line of said South three quarters;

Thence  South 89 degrees 42 minutes 22 seconds  East along said North line 30.00
feet to the POINT OF BEGINNING;

Thence  continuing  South 89 degrees 42 minutes 22 seconds East along said North
line 304.59 feet to a point on the East line of said West half;  Thence South 00
degrees 08 minutes 09 seconds East along said East line 286.01 feet;

Thence  North 89 degrees 42 minutes 22 seconds West along a line  parallel  with
the North line of said South  three  quarters  304.64  feet to a point on a line
30.00 feet East of and parallel with the West line of said West half;

                                       21
<PAGE>
Thence  North 00 degrees 07 minutes  32 seconds  West along said  parallel  line
286.01 feet to the POINT OF BEGINNING.

                                WATSON SUBSTATION

A parcel of land  situate in a portion of the  Southeast  quarter of Section 10,
Township 1 North,  Range 3 West of the Gila and Salt  River  Base and  Meridian,
Maricopa County, Arizona more particularly described as follows:

Commencing  at the  Southeast  corner of said  Section  10 from  which the South
quarter  corner of said  Section 10 bears South 89 degrees 27 minutes 57 seconds
West, a distance of 2626.67 feet;

Thence South 89 degrees 27 minutes 57 seconds West,  along the Southerly line of
the Southeast quarter of said Section 10, a distance of 912.51 feet;

Thence North 00 degrees 33 minutes 32 seconds  West, a distance of 65.00 feet to
the true point of beginning;

Thence  South 89 degrees 27  minutes  57 seconds  West,  along a line 65.00 feet
northerly of and parallel with said southerly line, a distance of 209.34 feet;

Thence North 00 degrees 33 minutes 32 seconds West, a distance of 220.00 feet;

Thence  North 89 degrees 27 minutes 57 seconds  East,  along a line  285.00 feet
northerly of and parallel with said southerly line, a distance of 209.34 feet;

Thence South 00 degrees 33 minutes 32 seconds East, a distance of 220.00 feet to
the true point of beginning.

                              WILDFLOWER SUBSTATION

The South 704.51 feet of the South half of the West 330 feet of the East half of
the East half of the Southwest  quarter of Section 6, Township 1 North,  Range 1
West of the Gila and Salt River Base and Meridian, Maricopa County, Arizona;

EXCEPT that portion,  if any, lying within the West 660 feet of the East half of
the Southwest quarter of Section 6; and

EXCEPT that portion,  if any, lying within the East half of the East half of the
East half of the Southwest quarter of Section 6.

                            WEST PHOENIX POWER PLANT

     All real and  personal  property  that are part of the West  Phoenix  Power
Plant,  including all such property repurchased by the Company at the end of the
term of that certain Lease and other  documents  relating to the "Combined Cycle
Transactions"  described in the Twenty-first  Supplemental Indenture dated as of
April 15, 1997 to the Mortgage,  and as further  described in that certain Deed,
Bill of Sale and  Assignment  as recorded on December 15, 2000 in the records of
Maricopa County,  Arizona as Instrument No. 2002-0957462,  and further including
the following described real property:

                                       22
<PAGE>
PARCEL NO. 1:

The Southeast  quarter of Section 9, Township 1 North,  Range 2 East of the Gila
and Salt River Base and Meridian, Maricopa County, Arizona;

EXCEPT the East 20 feet; and

EXCEPT the West 10 feet; and

EXCEPT the South 33 feet for roadway; and

EXCEPT the North 20 feet for railroad; and

EXCEPT BEGINNING at a point 811 feet South and 695 feet West of the East quarter
corner of Section 9,  Township 1 North,  Range 2 East of the Gila and Salt River
Base and Meridian;

Thence South 453 feet;

Thence West 95 feet;

Thence North 453 feet;

Thence East 95 feet, to the POINT OF BEGINNING; and

EXCEPT all that portion of the Southeast quarter of Section 9, Township 1 North,
Range 2 East of the Gila and Salt  River  Base and  Meridian,  Maricopa  County,
Arizona, more particularly bounded and described as follows:

BEGINNING at a point from which the East quarter corner of said Section 9, bears
North 29 degrees 57 minutes 45 seconds East a distance of 686.8 feet;

Thence South 669.0 feet;

Thence West 352.0 feet;

Thence North 453.0 feet;

Thence West 95.0 feet;

Thence North 102.0 feet;

Thence East 30.0 feet;

Thence North 114.0 feet;

Thence East 417.0 feet to the Place of Beginning; and

EXCEPT  that  portion of land  situated in the  Southeast  quarter of Section 9,
Township 1 North,  Range 2 East of the Gila and Salt  River  Base and  Meridian,
more particularly described as follows:

BEGINNING at the South quarter corner of Section 9;

                                       23
<PAGE>
Thence on a bearing  North 00  degrees  18  minutes  40  seconds  West along the
midsection line of Section 9, a distance of 1161.30 feet to a point;

Thence  North 89 degrees 22 minutes 30 seconds East a distance of 505.41 feet to
a point being corner number Sixteen,  of the Combined Cycle Plant Site, and TRUE
POINT OF BEGINNING of the parcel herein described;

Thence  continue  North 89 degrees 22  minutes  30  seconds  East a distance  of
1094.88 feet to a point being corner number One;

Thence  North 00 degrees 38 minutes 30 seconds West a distance of 207.88 feet to
a point being corner number Two;

Thence  South 89 degrees 22 minutes 30 seconds West a distance of 340.00 feet to
a point being corner number Three;

Thence South 0 degrees 38 minutes 30 seconds East a distance of 187.88 feet to a
point being corner number Four;

Thence South 89 degrees 22 minutes 30 seconds West a distance of 45.00 feet to a
point being corner number Five;

Thence North 0 degrees 38 minutes 30 seconds West a distance of 823.72 feet to a
point being corner number Six;

Thence  South 89 degrees 21 minutes 30 seconds West a distance of 279.44 feet to
a point being corner number Seven;

Thence  North 0 degrees 38 minutes 30 seconds  West a distance of 40.0 feet to a
point being corner number Eight;

Thence  South 89 degrees 21 minutes 30 seconds West a distance of 93.0 feet to a
point being corner number Nine;

Thence  South 0 degrees 38 minutes 30 seconds  East a distance of 40.0 feet to a
point being corner number Ten;

Thence South 89 degrees 21 minutes 30 seconds West a distance of 255.0 feet to a
point being corner number Eleven;

Thence North 0 degrees 38 minutes 30 seconds West a distance of 131.96 feet to a
point being corner number Twelve;

Thence  South 89 degrees 21 minutes 30 seconds West a distance of 502.62 feet to
a point being corner number Thirteen;

Thence South 0 degrees 38 minutes 30 seconds East a distance of 528.30 feet to a
point being corner number Fourteen;

Thence  North 89 degrees 21 minutes 30 seconds East a distance of 420.18 feet to
a point being corner number Fifteen;

                                       24
<PAGE>
Thence South 0 degrees 38 minutes 30 seconds East a distance of 447.17 feet to a
point being corner number Sixteen and the TRUE POINT OF BEGINNING; and

EXCEPT a portion of the Southeast quarter of Section 9, Township 1 North,  Range
2 East of the Gila and Salt River Base and Meridian,  Maricopa County,  Arizona,
being more particularly described as follows:

COMMENCING  at the South  quarter  corner of Section  9, from  whence the center
quarter  corner of Section 9, bears  North 0 degrees 18 minutes 18 seconds  West
2634.59 feet distant;

Thence North 0 degrees 18 minutes 18 seconds West a distance of 125.00 feet;

Thence  North 89 degrees 02 minutes 00 seconds  East a distance of 60.00 feet to
the TRUE POINT OF BEGINNING;

Thence North 0 degrees 18 minutes 16 seconds West a distance of 825.06 feet;

Thence North 89 degrees 02 minutes 00 seconds East a distance of 565.00 feet;

Thence South 0 degrees 18 minutes 18 seconds East a distance of 900.06 feet;

Thence South 89 degrees 02 minutes 00 seconds West a distance of 515.00 feet;

Thence North 0 degrees 18 minutes 18 seconds West, a distance of 75.00 feet;

Thence  South 89 degrees 02 minutes 00 seconds  West a distance of 50.00 feet to
the TRUE POINT OF BEGINNING; and

EXCEPT the North 17.00 feet of the South 50.00 feet of the Southeast  quarter of
Section 9,  Township  1 North,  Range 2 East of the Gila and Salt River Base and
Meridian, Maricopa County, Arizona;

EXCEPT the West 10.00 feet thereof; and

EXCEPT the East 574.18 feet thereof; and

EXCEPT a portion of the Southeast quarter of Section 9, Township 1 North,  Range
2 East of the Gila and Salt  River  and  Base  and  Meridian,  Maricopa  County,
Arizona, more particularly described as follows:

BEGINNING at the Southeast corner of Section 9;

Thence  South 89 degrees  02  minutes  00  seconds  West along the South line of
Section 9, a distance of 1399.80 feet;

Thence North 00 degrees 58 minutes 00 seconds West to a point on the North right
of way line of  Buckeye  Road,  a  distance  of 50.00  feet to the TRUE POINT OF
BEGINNING;

Thence  South 89 degrees 02 minutes 00 seconds  West,  a distance of 580.80 feet
along said right of way;

Thence North 00 degrees 17 minutes 52 seconds West, a distance of 900.06 feet to
a point on the South right of way of Hadley Street;

Thence  North 89 degrees 02 minutes 00 seconds  East,  a distance of 580.80 feet
along said right of way;

                                       25
<PAGE>
Thence South 00 degrees 17 minutes 52 seconds East, a distance of 900.06 feet to
the TRUE POINT OF BEGINNING; and

EXCEPT that  portion of the  Southeast  quarter of Section 9,  Township 1 North,
Range 2 East of the Gila and Salt  River  Base and  Meridian,  Maricopa  County,
Arizona, described as follows:

COMMENCING at the Southeast corner of said Section 9;

Thence  South 89 degrees 02 minutes 00 seconds West along the South line of said
Section 9, a distance of 83.10 feet;

Thence North 00 degrees 58 minutes 00 seconds  West, a distance of 50.00 feet to
a point on the North right of way line of Buckeye Road,  being the TRUE POINT OF
BEGINNING;

Thence South 89 degrees 02 minutes 00 seconds West along said right of way line,
a distance of 1316.70 feet;

Thence North 00 degrees 17 minutes 52 seconds West, a distance of 900.06 feet to
a point on the South right of way line of Hadley Street;

Thence North 89 degrees 02 minutes 00 seconds East along said right of way line,
a distance of 1345.10 feet to a point on a tangent curve  concave  Southwesterly
with a radius of 20.00  feet,  and a central  angle of 90  degrees 58 minutes 17
seconds,  a distance  of 31.76 feet to a point  tangent to the West right of way
line of 43rd Avenue;

Thence South 00 degrees 00 minutes 27 seconds West along said right of way line,
a distance of 504.79 feet;

Thence South 01 degrees 09 minutes 12 seconds West along said right of way line,
a distance of 100.01 feet;

Thence South 00 degrees 00 minutes 27 seconds West along said right of way line,
a distance of 242.11 feet;

Thence South 51 degrees 16 minutes 25 seconds  West, a distance of 53.77 feet to
the TRUE POINT OF  BEGINNING,  as conveyed in that  certain  Warranty  Deed from
Arizona Public Service Company to Suncor Development Company dated March 6, 1998
and recorded  July 24,  1998,  as Document  No.  980636446,  records of Maricopa
County, Arizona; and

EXCEPT  those  roadways for 43rd  Avenue,  47th Avenue,  Buckeye Road and Hadley
Street as delineated on Map of  Dedication  for APS Property  dated May 18, 1989
and recorded  November 9, 1989 in Book 335 of Maps, page 21, records of Maricopa
County, Arizona; and

EXCEPT a parcel of land  being  located in the  Southeast  quarter of Section 9,
Township 1 North,  Range 2 East of the Gila and Salt  River  Base and  Meridian,
Maricopa  County,  Arizona;  said parcel  being more  particularly  described as
follows:

COMMENCING at the South quarter corner of said Section;

Thence  North 00 degrees  18 minutes 01 seconds  West along the West line of the
Southeast  quarter of Section 9,  Township 1 North,  Range 2 East, a distance of
1,486.38 feet;

                                       26
<PAGE>
Thence North 89 degrees 17 minutes 24 seconds East, a distance of 40 feet to the
TRUE POINT OF BEGINNING of the parcel herein described;

Thence  continuing  Northeast along the same bearing,  a distance of 317.26 feet
along the North line of said parcel;

Thence South 01 degrees 11 minutes 27 seconds East, a distance of 95.08 feet;

Thence North 89 degrees 17 minutes 24 seconds East, a distance of 49.43 feet;

Thence South 00 degrees 42 minutes 36 seconds East, a distance of 100.14 feet;

Thence North 89 degrees 17 minutes 24 seconds East, a distance of 43.34 feet;

Thence South 00 degrees 42 minutes 36 seconds East, a distance of 105.96 feet;

Thence  South 89 degrees 20 minutes 44 seconds  West along the South line of the
parcel herein described, a distance of 412.99 feet;

Thence  North 00 degrees 18 minutes 01 seconds  West along the West line of said
parcel,  a distance of 300.78 feet to the TRUE POINT OF  BEGINNING of the parcel
herein described; and

EXCEPT a parcel of land located in the Southeast  quarter of Section 9, Township
1 North,  Range 2 East of the Gila and Salt  River Base and  Meridian,  Maricopa
County, Arizona; said parcel being more particularly described as follows:

COMMENCING at the East quarter corner of said Section;

Thence  South 89 degrees 21 minutes 48 seconds  West along the North line of the
Southeast  quarter of Section 9,  Township 1 North,  Range 2 East, a distance of
2,622.28 feet;

Thence  South 00 degrees  18 minutes 01 seconds  East along the West line of the
Southeast quarter of said Section, a distance of 94.82 feet;

Thence North 89 degrees 17 minutes 24 seconds East, a distance of 30 feet to the
TRUE POINT OF BEGINNING of the parcel herein described;

Thence continuing  Northeast along the same bearing, a distance of 1,040.41 feet
along the North line of said parcel;

Thence South 45 degrees 00 minutes 00 seconds East, a distance of 85.85 feet;

Thence South 00 degrees 42 minutes 36 seconds East, a distance of 88.39 feet;

Thence South 89 degrees 17 minutes 24 seconds West, a distance of 481.33 feet;

Thence South, a distance of 293.07 feet;

Thence South 89 degrees 17 minutes 24 seconds West, a distance of 618.57 feet;

Thence North 00 degrees 18 minutes 01 seconds West, a distance of 442.90 feet to
the TRUE POINT OF BEGINNING of the parcel herein described; and

                                       27
<PAGE>
EXCEPT a parcel of land located in the Southeast  quarter of Section 9, Township
1 North,  Range 2 East of the Gila and Salt  River Base and  Meridian,  Maricopa
County, Arizona; said parcel being more particularly described as follows:

COMMENCING at the Southeast corner of said Section;

Thence  North 00  degrees  03  minutes  22  seconds  East along the East line of
Section 9, Township 1 North, Range 2 East, a distance of 1,359.93 feet;

Thence South 89 degrees 21 minutes 48 seconds West, a distance of 40 feet to the
TRUE POINT OF BEGINNING of the parcel herein described;

Thence  continuing  Southwest along the same bearing,  a distance of 302.93 feet
along the South line of the parcel herein described;

Thence  North 00 degrees 03 minutes 22 seconds  East along the West line of said
parcel, a distance of 669.00 feet;

Thence  North 89 degrees 21 minutes 48 seconds East along the North line of said
parcel, a distance of 302.93 feet;

Thence  South 00 degrees 03 minutes 22 seconds  West along the East line of said
parcel,  a distance of 669.00 feet to the TRUE POINT OF  BEGINNING of the parcel
herein described.

PARCEL NO. 2:

The East half of the North  half of the East half of the  Southwest  quarter  of
Section 9,  Township  1 North,  Range 2 East of the Gila and Salt River Base and
Meridian, Maricopa County, Arizona;

EXCEPT beginning at the Northeast corner of said Southwest  quarter of Section 9
in the  Southerly  line of the parcel of land  described in deed dated March 19,
1910 to Phoenix & Buckeye Railway Company recorded in Book 89 of Deeds, Page 97,
records of Maricopa County, Arizona;

Thence  Westerly along said Southerly line also the North line of said Southwest
quarter of Section 9, a distance of 1334.29 feet to the Northwest  corner of the
Northeast  quarter of said  Southwest  quarter of Section 9, also the  Northeast
corner of the parcel of land  described in Deed dated August 22, 1949 to Arizona
Eastern  Railroad  Company recorded in Docket 491, Page 216, records of Maricopa
County, Arizona;

Thence Southerly along the West line of said Northeast quarter of said Southwest
quarter of Section 9, a distance of 20.0 feet;

Thence  Easterly  parallel  with said  North line of said  Southwest  quarter of
Section 9, a distance of 1334.38 feet to the East line of said Southwest quarter
of Section 9;

Thence  Northerly  along said East line a distance  of 20.0 feet to the point of
beginning;

ALSO  EXCEPT a strip of land 20 feet in width in  Section  9,  Township 1 North,
Range 2 East of the Gila and Salt River Base and Meridian, Maricopa County, said
strip of land lying 10 feet on each side of the following described center line;

                                       28
<PAGE>
Beginning  at the  Northeast  corner of said  Section 9, and using as a base the
North  boundary line of said Section,  said North boundary line having a bearing
of South 89  degrees 22  minutes  West  based on a magnetic  bearing of South 75
degrees 00 minutes West;

Thence  South 88 degrees 22 minutes  West a distance  of 2661.5 feet to the True
Point of Beginning;

Thence South 0 degrees 07 minutes West a distance of 1325 feet;

Thence South 0 degrees 01 minutes West a distance of 1243.4 feet;

Thence South 0 degrees 14 minutes East a distance of 1331.6 feet;

Thence  South 0 degrees 27 minutes  East a distance of 1318.9 feet to a point in
the South boundary line of said Section 9, from which point the Southeast corner
of said  Section 9 bears  North 89 degrees 36 minutes  East a distance of 2606.5
feet,  as conveyed to the United States of America,  by  instrument  recorded in
Deed Book 115, Page 276, records of Maricopa County, Arizona;

EXCEPT  that  portion of the East half of the North half of the East half of the
Southwest  quarter of Section 9, Township 1 North,  Range 2 East of the Gila and
Salt  River Base and  Meridian,  Maricopa  County,  Arizona,  more  particularly
described as follows:

COMMENCING at the Northeast  corner of said Southwest  quarter of Section 9 from
whence the Southeast corner of said Southwest quarter of Section 9 lies South 00
degrees 18 minutes 01 seconds East, a distance of 2634.48 feet;

Thence  South 00 degrees 18 minutes 01 seconds  East along the East line of said
Southwest quarter of Section 9, a distance of 497.53 feet;

Thence South 89 degrees 24 minutes 46 seconds  West, a distance of 53.01 feet to
the TRUE POINT OF BEGINNING;

Thence South 00 degrees 37 minutes 11 seconds East, a distance of 467.02 feet;

Thence South 89 degrees 26 minutes 58 seconds West, a distance of 392.04 feet;

Thence North 00 degrees 36 minutes 52 seconds West, a distance of 466.77 feet;

Thence North 89 degrees 24 minutes 46 seconds East, a distance of 392.00 feet to
the TRUE POINT OF BEGINNING; and

EXCEPT a parcel of land located in the Southwest  quarter of Section 9, Township
1 North,  Range 2 East of the Gila and Salt  River Base and  Meridian,  Maricopa
County, Arizona; said parcel being more particularly described as follows:

COMMENCING at the South quarter corner of said Section;

Thence  North 00 degrees  18 minutes 01 seconds  West along the East line of the
Southwest  quarter of Section 9,  Township 1 North,  Range 2 East, a distance of
1,281.67 feet;

Thence South 89 degrees 17 minutes 36 seconds West, a distance of 40 feet to the
TRUE POINT OF BEGINNING of the parcel herein described;

                                       29
<PAGE>
Thence  continuing  Southwest along the same bearing,  a distance of 629.09 feet
along the South line of the parcel herein described;

Thence  North 00 degrees  13 minutes 26 seconds  West along the West line of the
parcel herein described, a distance of 1,123.64 feet;

Thence North 89 degrees 21 minutes 48 seconds East, a distance of 221.11 feet;

Thence South 00 degrees 36 minutes 52 seconds East, a distance of 781.97 feet;

Thence North 89 degrees 17 minutes 24 seconds East, a distance of 402.19 feet;

Thence South 00 degrees 18 minutes 01 seconds East, a distance of 341.39 feet to
the TRUE POINT OF BEGINNING of the parcel herein described.

PARCEL NO. 3:

The South  one-half of the East one-half of the Southwest  quarter of Section 9,
Township 1 North,  Range 2 East of the Gila and Salt  River  Base and  Meridian,
Maricopa County, Arizona;

EXCEPT the West 30.00 feet and

EXCEPT a strip of land  20.00  feet in width in  Section  9, said  strip of land
lying 10.00 feet on each side of the following described centerline;

COMMENCING  at the  Northeast  corner of said Section 9, and using as a base the
North  boundary of said  Section,  said North  boundary line having a bearing of
South 89 degrees 22 minutes West based on a magnetic bearing of South 75 degrees
00 minutes  West;  Thence  South 88 degrees 22 minutes  West 2,661.5 feet to the
POINT OF BEGINNING;

Thence South 00 degrees 07 minutes West 1,325 feet;

Thence South 00 degrees 01 minutes West 1,243.4 feet;

Thence South 00 degrees 14 minutes East 1,331.6 feet;

Thence  South 00 degrees 27 minutes  East  1,318.9  feet to a point in the South
boundary line of said Section 9 from which the Southeast  corner of said Section
9 bears North 89 degrees 36 minutes East 2,606.5 feet, as conveyed to the United
States of America by instrument recorded in Book 115 of Deeds, Page 276, records
of Maricopa County, Arizona; and

EXCEPT the South 450.00 feet.

                                  NAVAJO COUNTY

                            CHOLLA GENERATING STATION

POWER PLANT SITE

That part of Sections 15, 22, 23, 24, 25, 26, 27, 35 and 36,  Township 18 North,
Range 19 East, Gila and Salt River Meridian, Navajo County, Arizona described as
follows:

                                       30
<PAGE>
BEGINNING at a capped pipe marking the common  corner of Sections 14, 15, 22 and
23;

Thence  North 0 degrees 22  minutes 36 seconds  West along the East line of said
Section 15, a distance of 2669.78 feet to a capped pipe marking the East quarter
corner thereof;

Thence  North 89  degrees  55  minutes  54  seconds  West  along  the  East-West
mid-section line of said Section 15, a distance of 299.82 feet to a point in the
West line of the East 300 feet of the  Southeast  quarter  of said  Section  15,
being a found 5/8 inch rebar;

Thence  South 0 degrees  22 minutes  36  seconds  East  along said West line,  a
distance of 2668.57 feet to a found 5/8 inch rebar  located in the South line of
said Section 15;

Thence South 0 degrees 3 minutes 13 seconds West along the West line of the East
300 feet of the Northeast quarter of said Section 22, a distance of 1234.75 feet
to a point in the Southerly right of way line of old U.S.
Highway 66;

Thence  North 56 degrees 28  minutes  30 seconds  West,  along said right of way
line,  a  distance  of 156.72  feet to a point in the East line of the parcel of
land described in Docket 265, page 174;

Thence South 34 degrees 45 minutes 39 seconds West, along last said East line, a
distance of 3654.13  feet to a point in the  Northerly  right of way line of the
Atchison, Topeka and Santa Fe Railroad;

Thence South 44 degrees 6 minutes 47 seconds  West, a distance of 210.22 feet to
the intersection of the Southerly right of way line of the Atchison,  Topeka and
Santa Fe Railroad and the North-South mid-section line of said Section 22;

Thence  South 0 degrees 2 minutes  33 seconds  East along last said  mid-section
line, a distance of 1005.76 feet to the common  quarter  corner of said Sections
22 and 27;

Thence  North 89 degrees 44 minutes 21 seconds West along the North line of said
Section 27, a distance of 120.00 feet to its Intersection with the thread of the
Little Colorado River;

Thence  Southerly and Easterly  along said thread to its  intersection  with the
East line of said  Section  27,  said point  lying South 0 degrees 30 minutes 30
seconds  East,  a  distance  of 600.00  feet from the  Northeast  corner of said
Section 27;

Thence South 0 degrees 30 minutes 30 seconds East,  along last said East line, a
distance of 4714.56 feet to the common corner of said Section 26, 27, 34 and 35;

Thence North 89 degrees 37 minutes 3 seconds East,  along the North line of said
Section 35, a distance of 422.00 feet to its intersection with the thread of the
Little Colorado  River,  from which point the common corner of said Sections 25,
26, 35 and 36 bears  North 89 degrees 37 minutes 3 seconds  East,  a distance of
4894.86 feet;

Thence Southerly and  Southeasterly  along said thread to its intersection  with
the East line of said  Section 35,  from which  point the common  corner of said
Sections  25, 26, 35 and 36 bears North 0 degrees 14 minutes 4 seconds  West,  a
distance of 3171.07 feet;

Thence  South 0 degrees 14 minutes 4 seconds  East along last said East line,  a
distance of 2166.50 feet to the common  corner of said Sections 35 and 36 and of
Sections  1 and 2 of  Township  17  North,  Range 19 East,  Gila and Salt  River
Meridian;

                                       31
<PAGE>
Thence  North 88 degrees 27 minutes 31 seconds East along the South line of said
Section 36, a distance of 1337.23  feet to the West 1/16th  corner  between said
Sections 36 and 1;

Thence  North 0 degrees 16 minutes 29 seconds West along the West 1/16th line of
said  Section 36, a distance of 5324.98 feet to the West 1/16th  corner  between
said Sections 25 and 36;

Thence  North 89  degrees 0 minutes 0 seconds  East along the South line of said
Section  25,  a  distance  of  1112.92  feet  to  its   intersection   with  the
Southwesterly right of way line of the Atchison, Topeka and Santa Fe Railroad;

Thence  North 56 degrees 26  minutes  18 seconds  West along said  Southwesterly
right of way line, a distance of 611.23 feet;

Thence North 33 degrees 18 minutes 42 seconds East, a distance of 200.00 feet to
the  Northeasterly  right  of way  line of the  Atchison,  Topeka  and  Santa Fe
Railroad,  said  point  being in the East  line of the  West  2050  feet of said
Section 25;

Thence  North 0 degrees  24 minutes 1 second  West along last said East line,  a
distance of 4808.67 feet to its intersection with the North line of said Section
25, from which the common  corner of said Sections 23, 24, 25 and 26 bears South
89  degrees 31 minutes  41  seconds  West  (South 89 degrees 20 minutes  West of
record) a distance of 2050.00 feet;

Thence  North 0 degrees 24 minutes 31 seconds  West  (North 0 degrees 36 minutes
West of record), a distance of 637.66 feet (637.67 feet of record);

Thence  North 71 degrees 35 minutes 24 seconds West (North 71 degrees 46 minutes
West of record),  a distance of 2149.74 feet (2150.04 feet of record) to a point
in the West line of said  Section 24 (said point being North 0 degrees 2 minutes
East along the West line of said Section 24, a distance of 1334.13 feet from the
Southwest corner of said Section 24, of record);

Thence  North 0 degrees 14  minutes 48 seconds  East along the East line of said
Section  23, a distance of 164.99 feet to its  intersection  with the  Southerly
right of way line of Old U.S. Highway 66;

Thence  North 74 degrees 55  minutes 37 seconds  West along last said  Southerly
right of way line,  a  distance  of  1708.33  feet to the  beginning  of a curve
concave Northerly having a radius of 5779.58 feet;

Thence continue along last said Southerly right of way line, Northwesterly along
the arc of said  curve  through  a  central  angle of 5 degrees  28  minutes  11
seconds, a distance of 551.73 feet to a point of tangency;

Thence continue along last said Southerly right of way line, North 69 degrees 27
minutes  38 seconds  West,  a distance  of 1040.53 to the  beginning  of a curve
concave Northerly having a radius of 2914.79 feet;

Thence  continue along last said Southerly  right of way line,  along the arc of
last  said  curve  through a central  angle of 4 degrees 1 minute 0  seconds,  a
distance  of 83.66  feet to a point  from  which a radial  line  bears  North 22
degrees 11 minutes 3 seconds East said point being the Northeast  corner of that
part of the West half of the said  Section  23  described  in Parcel 1 of Docket
766, page 155;

Thence South 26 degrees 20 minutes 42 seconds West, a distance of 359.44 feet to
the Southeast corner of said parcel of land;

                                       32
<PAGE>
Thence North 68 degrees 47 minutes 52 seconds West, a distance of 484.70 feet to
the Southwest corner of said parcel of land;

Thence North 33 degrees 42 minutes 40 seconds East, a distance of 396.09 feet to
the  Northwest  corner of said parcel of land,  said point being in the arc of a
curve in said  Southerly  right of way line of Old U.S.  Highway  66, said curve
being  concave  to the North  having a radius of  1482.39  feet and from which a
radial line thereof bears North 29 degrees 40 minutes 36 seconds East;

Thence  Northwesterly  along last said Southerly right of way line along the arc
of said  curve  through a central  angle of 9  degrees  7 minutes 0  seconds,  a
distance of 103.40 feet;

Thence continue along last said Southerly right of way line, North 56 degrees 19
minutes 38 seconds West, a distance of 1950.09 feet to its intersection with the
West line of said Section 23;

Thence  North 0 degrees 3 minutes 13 seconds  East along last said West line,  a
distance of 1431.70 feet to the POINT OF BEGINNING;

EXCEPT that part of said Section 22 lying whiting the right of way of Interstate
40 and being described as follows:

BEGINNING at a capped pipe marking the common corner of said Sections 14, 15, 22
and 23;

Thence  South 0 degrees 3 minutes  13  seconds  West along the East line of said
Section 22, a distance of 384.09 feet to a point in the  Northeasterly  right of
way line of said Interstate 40 and the TRUE POINT OF BEGINNING;

Thence  continue  South 0 degrees 3 minutes 13 seconds West along last said East
line,  a distance  of 396.43 feet to a point in the  Southwesterly  right of way
line of said Interstate 40;

Thence  North 63 degrees 11  minutes  44 seconds  West along said  Southwesterly
right of way line,  a distance of 335.95 feet to a point in the West line of the
East 300 feet of the Northeast quarter of said Section 22;

Thence North 0 degrees 3 minutes 13 seconds  East,  along last said West line, a
distance of 413.51 feet to a point in said Northeasterly right of way line;

Thence  South 59 degrees 11 minutes 46 seconds  East,  along said  Northeasterly
right of way line, a distance of 218.60 feet;

Thence continue along last said Northeasterly right of way line South 63 degrees
11 minutes  44 seconds  East,  a  distance  of 125.38  feet to the TRUE POINT OF
BEGINNING; and

EXCEPT  that part of said  Section 22 lying  within the right of way of Old U.S.
Highway 66 and being described as follows:

BEGINNING at a capped pipe marking the common corner of said Sections 14, 15, 22
and 23;

Thence  South 0 degrees 3 minutes  13  seconds  West along the East line of said
Section 22, a distance of 1311.58 feet to a point in the Northeasterly  right of
way line of said Old U.S. Highway 66 and the TRUE POINT OF BEGINNING;

                                       33
<PAGE>
Thence continue along last said East line,  South 0 degrees 3 minutes 13 seconds
West,  a distance  of 120.12 feet to a point in the  Southwesterly  right of way
line of said Old U.S. Highway 66;

Thence  North 56 degrees 28 minutes 30 seconds West along last said right of way
line, a distance of 359.47 feet;

Thence North 0 degrees 3 minutes 13 seconds East, a distance of 120.12 feet to a
point in last said Northeasterly right of way line;

Thence South 56 degrees 28 minutes 30 seconds East, along last said right of way
line, a distance of 359.47 feet to the TRUE POINT OF BEGINNING; and

EXCEPT that certain tract of land  situated in the Southwest  quarter of Section
23, Township 18 North, Range 19 East of the Gila and Salt River Meridian, Navajo
County, Arizona, being more particularly described as follows:

COMMENCING at the brass cap that marks the Southwest  corner of Section 23, from
whence the brass cap that marks the Northwest corner of said Section bears North
0 degrees 2 minutes 5 seconds West;

Thence North 61 degrees 33 minutes 56 seconds East a distance of 1368.08 feet to
a 5/8 inch rebar that marks the Southeasterly  corner of said tract and the TRUE
POINT OF BEGINNING;

Thence  North 57 degrees 23 minutes 27 seconds West a distance of 357.99 feet to
a 5/8 inch rebar;

Thence  North 32 degrees 36 minutes 33 seconds East a distance of 117.67 feet to
a 5/8 inch rebar;

Thence  North 72 degrees 58 minutes 14 seconds East a distance of 114.71 feet to
a 5/8 inch rebar;

Thence  North 32 degrees 36 minutes 33 seconds East a distance of 555.92 feet to
a brass cap set in concrete;

Thence  South 77 degrees 44 minutes 13 seconds East a distance of 273.73 feet to
a 5/8 inch rebar;

Thence  South 32 degrees 36 minutes 33 seconds West a distance of 256.05 feet to
a 5/8 inch rebar;

Thence South 57 degrees 23 minutes 27 seconds East a distance of 27.06 feet to a
5/8 inch rebar;

Thence  South 32 degrees 36 minutes 33 seconds West a distance of 600.12 feet to
the TRUE POINT OF BEGINNING; and

EXCEPT that certain tract of land  situated in the Southwest  quarter of Section
23, Township 18 North, Range 19 East of the Gila and Salt River Meridian, Navajo
County, Arizona, being more particularly described as follow:

COMMENCING at the brass cap that marks the Southwest  corner of Section 23, from
whence the brass cap that marks the Northwest corner of said Section bears North
0 degrees 2 minutes 5 seconds West;

Thence  North 9 degrees 43 minutes 57 seconds East a distance of 1364.55 feet to
the 5/8 inch rebar that  marks the most  Southerly  corner of said tract and the
TRUE POINT OF BEGINNING;

Thence  North 34 degrees 53 minutes 35 seconds West a distance of 144.40 feet to
a 5/8 inch rebar;

                                       34
<PAGE>
Thence North 55 degrees 6 minutes 25 seconds East a distance of 439.58 feet to a
5/8 inch rebar;

Thence South 34 degrees 53 minutes 35 seconds East a distance of 85.73 feet to a
5/8 inch rebar;

Thence South 55 degrees 6 minutes 25 seconds West a distance of 276.35 feet to a
5/8 inch rebar;

Thence South 34 degrees 53 minutes 35 seconds East a distance of 58.67 feet to a
5/8 inch rebar;

Thence  South 55 degrees 6 minutes 25 seconds  West a distance of 163.23 feet to
the TRUE POINT OF BEGINNING; and

EXCEPT all those parts thereof  lying within the  Atchison,  Topeka and Santa Fe
Railroad Companys' 200 foot wide fee owned right of way; and

EXCEPT all oil,  gas and  minerals as  reserved in Deed  recorded in Docket 129,
page 481, records of Navajo County, Arizona, affects Section 25; and

EXCEPT 1/16th of all oil, gases and other hydrocarbon  substances,  coal, stone,
metals,  minerals,  fossils and  fertilizers of every name and  description  and
except  all  materials  which may be  essential  to  production  of  fissionable
materials as reserved in Arizona Revised Statutes, affects Section 36; and

EXCEPT all oil,  gas and sodium as reserved  to the United  States of America in
Patent to the West half of the Northwest quarter of Section 26.

WELL FIELD

PARCEL 1:

The North Half;
The Southeast quarter;
The North  half of the  Southwest  quarter;  and The  Southeast  quarter  of the
Southwest quarter of Section 4,
Township  17 North,  Range 19 East of the Gila and Salt River  Meridian,  Navajo
County, Arizona;

EXCEPT the following two parcels:

(1) In the Northeast  quarter of Section 4, Township 17 North,  Range 19 East of
the Gila and Salt River and Meridian,  Navajo County, Arizona, more particularly
described as follows:

FROM the Northeast corner of said Section 4;

thence South (assumed  bearing) along the East line of the Northeast  quarter of
said Section 4, a distance of 900.00 feet;

Thence  West 25.00 feet to the point of  beginning  of the parcel of land herein
described and the Northeast corner thereof;
         Thence West 460.00 feet;
         Thence South 460.00 feet;
         Thence East 460.00 feet;
Thence North 460.00 feet to the POINT OF BEGINNING.

                                       35
<PAGE>
(2) A rectangular  shaped parcel of land in the Northeast  quarter of Section 4,
Township 17 North, Range 19 East of the Gila and Salt River and Meridian, Navajo
County, Arizona, more particularly described as follows:

COMMENCING  at the  Northeast  corner of said Section 4; thence  South  (assumed
bearing) along the East line of said Section 4, a distance of 1360.00 feet;

Thence West 25.00 feet to the  Southeast  corner of that certain  parcel of land
described in Deed to Mountain States Telephone and Telegraph Company recorded in
Docket 151,  page 497,  and the TRUE POINT OF  BEGINNING  for the parcel  herein
described;

Thence South 400.00 feet;

Thence West 460.00 feet;

Thence North  400.00 feet to the  Southwest  corner of said parcel  described in
Docket 151, page 497;

Thence East along the South line of last said parcel,  a distance of 460.00 feet
to the POINT OF BEGINNING.

PARCEL 2:

The Southwest  quarter of the Southwest quarter of Section 4, Township 17 North,
Range 19 East of the Gila and Salt River Meridian, Navajo County, Arizona.

PARCEL 3:

The Southeast quarter of Section 2, Township 17 North, range 19 East of the Gila
and Salt River Meridian, Navajo County, Arizona;

EXCEPT all oil, gas and other hydrocarbon substances, Helium or other substances
of a gaseous nature, coal, metals, minerals,  fossils,  fertilizer or every name
and description, together with all uranium, thorium, or any other material which
is or may be  determined  by the laws of the United  State,  or of this state or
decisions of court to be peculiarly  essential to the  production of fissionable
materials as reserved in Deed recorded in Book 509, page 438,  records of Navajo
County, Arizona. County, Arizona.

PARCEL 4:

The  East  half of the  Northwest  quarter  and the West  half of the  Northeast
quarter of Section  34,  Township  18 North,  Range 19 East of the Gila and Salt
River Meridian, Navajo County, Arizona;

EXCEPT all oil and/or minerals as reserved in Deed recorded in Book 31 of deeds,
page 310,  and  recorded  in Docket  688,  page 17,  records  of Navajo  County,
Arizona.

PARCEL 5:

The Southwest quarter of the Northwest quarter,  the North half of the Southwest
quarter,  and the  Northwest  quarter of the  Southeast  quarter of Section  34,
Township  18 North,  Range 19 East of the Gila and Salt River  Meridian,  Navajo
County, Arizona;

EXCEPT the  following  described  property  conveyed  by Special  Warranty  Deed
recorded in Document No. 2002-6843, records of Navajo County, Arizona:

                                       36
<PAGE>
COMMENCING at the Southwest  corner of Section 34, a 3" brass cap stamped A.P.S.
1977;

Thence  North 00 degrees 03 minutes 35 seconds  West 1338.47 feet along the West
section line;

Thence  North 89 degrees 56 minutes 02 seconds East 2390.60 feet to a 1/2" rebar
and tag LS 22290, the POINT OF BEGINNING;

Thence  North 00 degrees 08 minutes 50 seconds West 1082.24 feet to a 1/2" rebar
and tag LS 22290;

Thence  North 89 degrees 56 minutes 02 seconds East 1609.99 feet to a 1/2" rebar
and tag LS 22290;

Thence  South 00 degrees 08 minutes 50 seconds East 1082.24 feet to a 1/2" rebar
and tag LS 22290;

Thence  South 89 degrees 56 minutes 02 seconds West 1609.99 feet to the POINT OF
BEGINNING.

PARCEL 6:

Section  28,  Township  18  North,  Range 19 East of the  Gila  and  Salt  River
Meridian, Navajo County, Arizona;

EXCEPT all oil,  gas and  minerals  reserved in Docket 168,  page 155,  from the
Southeast  quarter and the South half of the Northeast quarter and the Northwest
quarter of the Northeast quarter.

PARCEL 7:

The  Southwest  quarter of Section 21,  Township 18 North,  Range 19 East of the
Gila and Salt River Meridian, Navajo County, Arizona;

EXCEPT any part of the  Southwest  quarter  lying  North of the Little  Colorado
River.

PARCEL 8:

The South half of Section 6,  Township  17 North,  Range 20 East of the Gila and
Salt River Meridian, Navajo County, Arizona;

EXCEPT all coal and other  minerals as reserved in Patent from United  States of
America; and

EXCEPT the East 219 acres thereof.

PARCEL 9:

The East 219 acres of the South half of Section 6,  Township 17 North,  Range 20
East of the Gila Salt River and Meridian, Navajo County, Arizona;

EXCEPT all coal and other  minerals as reserved in Patent from United  States of
America.

PARCEL 10:

Section  10 ,  Township  17  North,  Range 19 East of the  Gila  and Salt  River
Meridian, Navajo County, Arizona;

EXCEPT all minerals in Patent from United States of America.

                                       37
<PAGE>
FLY ASH

PARCEL 1:

The West half of the West half of the Northwest quarter of the Northwest quarter
and the West half of the  Northwest  quarter  of the  Southwest  quarter  of the
Northwest  quarter of Section 29,  Township 18 North,  Range 20 East of the Gila
and Salt River Meridian, Navajo County, Arizona.

PARCEL 2:

The West half of the East half of the West half of the Northwest  quarter of the
Northwest quarter and the West half of the East half of the Northwest quarter of
the Southwest quarter of the Northwest quarter of Section 29, Township 18 North,
Range 20 East of the Gila and Salt River Meridian, Navajo County, Arizona.

EXCEPT all oil and gas as  conveyed  in Book 11 of Deeds,  page 355,  records of
Navajo County, Arizona.

PARCEL 3:

COMMENCING at the Northeast  corner of Section 25,  Township 18 North,  Range 19
East of Gila and Salt River Meridian;

Thence  along said  Section line South 88 degrees 35 minutes West for a distance
of 2460 feet to a point;

Thence South 43 degrees 30 minutes East for a distance of 380 feet to a point;

Thence South 36 degrees 35 minutes East for a distance of 2180 feet to a point;

Thence  South 63 degrees 50 minutes  East for a distance of 1000 feet to a point
on the East section line of said Section 25;

Thence North 2530 feet to the POINT OF BEGINNING,  being in Section 25, Township
18 North, Range 19 East of the Gila and Salt River and Meridian;

And  including  all land in said  Section  25  located on the North side of U.S.
Highway 66 (now Interstate Highway 40), Navajo County, Arizona;

EXCEPT  beginning  at a point of  Section  tine 1300 feet West of the  Northeast
corner of Section 25, Township 18 North, Range 19 East;

Thence West on Section line 1095 feet;

Thence South 37 degrees 49 minutes East 1100 feet;

Thence North 32 degrees 25 minutes East 210.6 feet;

Thence North 61 degrees 51 minutes East 600 feet;

Thence North 26 degrees 17 minutes West 460 feet to the PLACE OF BEGINNING; and

EXCEPT that portion of which lies  Southwesterly of the  Northeasterly  right of
way line of existing U.S. Highway 66 (now Interstate Highway 40).

                                       38
<PAGE>
PARCEL 4:

The East half of the Southeast  quarter of the Southeast  quarter of Section 24,
Township  18 North,  Range 19 East of the Gila and Salt River  Meridian,  Navaho
County, Arizona.

EXCEPT all the oil, gas,  sodium and potassium as reserved in Patent from United
States of America.

PARCEL 5:

The South half of the Southwest quarter of Section 19, Township 18 North,  Range
20 East of the Gila and Salt River Meridian, Navajo County, Arizona.

PARCEL 6:

All of Section 30 North of the Northerly  boundary of  Interstate  Highway 40 in
Township  18 North,  Range 20 East of the Gila and Salt River  Meridian,  Navajo
County, Arizona;

EXCEPT the Southeast  quarter of the Southeast  quarter and the East half of the
Southwest  quarter of the  Southeast  quarter of Section 30,  Township 18 North,
Range 20 East of the Gila and Salt River Meridian, Navajo County, Arizona; and

EXCEPT all oil, gas and mineral  rights as reserved in Patent from United States
of America.

BOTTOM ASH

PARCEL 1:

The West half of the Southwest  quarter of Section 13, Township 18 North,  Range
19 East of the Gila and Salt River Meridian, Navajo County, Arizona;

EXCEPT all oil,  gas rights as  reserved  in Deed  recorded in Book 13 of Deeds,
page 164, records of Navajo County, Arizona.

PARCEL 2:

The West half of the Northwest quarter of the Northwest quarter of the Northwest
quarter;

The  North  half  of the  Northeast  quarter  of the  Northwest  quarter  of the
Northwest quarter of the Northwest quarter;

The Southwest  quarter of the Northeast  quarter of the Northwest quarter of the
Northwest quarter of the Northwest quarter;

The Northwest  quarter of the Southeast  quarter of the Northeast quarter of the
Northwest quarter of the Northwest quarter of the Northwest quarter;

The West half of the West half of the Southeast quarter of the Northwest quarter
of the Northwest quarter of the Northwest quarter;

The  North  half  of the  Northeast  quarter  of the  Northwest  quarter  of the
Southeast  quarter  of the  Northwest  quarter of the  Northwest  quarter of the
Northwest  quarter of Section 24,  Township 18 North,  Range 19 East of the Gila
and Salt River Meridian, Navajo County, Arizona.

                                       39
<PAGE>
PARCEL 3:

The North half of the Northeast quarter of the Northeast quarter,  the Northeast
quarter of the

Northwest  quarter of the  Northeast  quarter of Section 23,  Township 18 North,
Range 19 East of the Gila and Salt River Meridian, Navajo County, Arizona.

PARCEL 4:

The East half of the Northeast quarter of the Southeast quarter;

The Southwest quarter of the Northeast quarter of the Southeast quarter;

The East half of the Southwest quarter of the Southeast quarter; and

The Southeast quarter of the Southeast quarter of Section 14, Township 18 North,
Range 19 East of the Gila and Salt River Meridian, Navajo County, Arizona;

Except all oil,  gas,  sodium and  potassium  as  reserved in Patent from United
States of America.

                                 YAVAPAI COUNTY

                             MCGUIREVILLE SUBSTATION

The West 250.00 feet of the following described parcel:

A parcel of land  located in the  Southeast  quarter of Section 33,  Township 15
North Range 5 East of the Gila and Salt River Base and Meridian, Yavapai County,
Arizona, described as follows:

Commencing   at  the   Southeast   corner  of  said  Section  33;  thence  North
89(degree)41'00"  West 2694.12 feet to the  Southwest  corner of said  Southeast
quarter;  thence  North  01(degree)01'25"  East,  along  the  West  line of said
Southeast  quarter,  1051.66  feet  to  the  true  point  of  beginning;  thence
continuing  North  01(degree)01'25"  East,  along said West line,  280.00  feet;
thence South 88(degree)25'00" East, 660.13 feet;
thence South  11053'50"  East,  along the West line of an easement  created by a
combination of the deeds  recorded in Book 187 of Deeds,  Page 174 and Book 1396
of Official Records, Page 937 a distance of 287.92 feet; thence 88(degree)25'00"
West 724.51 feet to the true point of beginning.

Together  with an easement for ingress,  egress and  utilities set forth in deed
recorded in Book 3214 of Official Records, Page 318.

     SECTION  11.  THE  ELECTRIC  SUBSTATIONS  OF  THE  COMPANY,  including  all
buildings,  structures, towers, poles, all equipment, appliances and devices for
transforming, converting and distributing electric energy, and all land owned by
the  Company  upon  which  the  same  are  situated,  and  all of the  Company's
easements,  rights of way, rights, machinery,  equipment,  appliances,  devices,
licenses  and  supplies  forming  a part of said  substations,  or any of  them,
including additions and improvements to any of the foregoing, or used or enjoyed
or capable of being use or enjoyed in conjunction with any thereof.

     SECTION  12.  Additions,   extensions  and  improvements  to  THE  ELECTRIC
TRANSMISSION SYSTEMS of the Company.

                                       40
<PAGE>
     SECTION  13.  Additions,   extensions  and  improvements  to  THE  ELECTRIC
DISTRIBUTION SYSTEMS of the Company,  including,  the construction of additional
facilities  throughout  the  Company's  service  area,  as well as  extension of
residential  and  downtown  underground   distribution   facilities,   including
associated  distribution equipment such as voltage regulators,  capacitor banks,
sectionalizing  equipment,  transformers,  street lighting  systems,  meters and
services, including reconstruction and improvements to provide efficient Company
operation.

                                       41
<PAGE>
     IN WITNESS  WHEREOF,  ARIZONA PUBLIC SERVICE  COMPANY,  party hereto of the
first  part,  has caused its  corporate  name to be hereunto  affixed,  and this
instrument to be signed and sealed by its President, one of its Vice Presidents,
or its Treasurer,  and its corporate seal to be attested by its Secretary or one
of its Assistant  Secretaries or Associate Secretaries for and in its behalf, in
the City of  Phoenix,  Arizona,  and THE BANK OF NEW YORK,  party  hereto of the
second part,  has caused its  corporate  name to be hereunto  affixed,  and this
instrument  to be signed and sealed by one of its Vice  Presidents  or Assistant
Vice  Presidents  and its corporate  seal to be attested by one of its Assistant
Vice  Presidents or Assistant  Treasurers for and in its behalf,  in the City of
New York, New York, all as of the 1st day of November, 2002.


                                        ARIZONA PUBLIC SERVICE COMPANY


                                          Barbara M. Gomez
                                          --------------------------------------
                                                         TREASURER


Attest:

Betsy A. Pregulman
--------------------------------------
      ASSOCIATE SECRETARY

Executed, sealed and delivered by
  ARIZONA PUBLIC SERVICE COMPANY
  in the presence of:


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

                                                          [SEAL]
--------------------------------------


                                          THE BANK OF NEW YORK, As Trustee


                                          Debra A. Schwalb
                                          --------------------------------------
                                                       VICE PRESIDENT
Attest:

Thomas J. Provenzano
--------------------------------------
Executed, sealed and delivered by
  THE BANK OF NEW YORK in the
  presence of:

Thomas J. Provenzano
--------------------------------------
Thomas J. Provenzano
Vice President


                                                          [SEAL]

                                       42
<PAGE>
STATE OF ARIZONA..         )
                                    ) ss.:
COUNTY OF MARICOPA                  )

     On this  1st day of  November,  2002,  before  me,  Debra L.  Blondin,  the
undersigned  officer,  personally  appeared  Barbara M. Gomez,  who acknowledged
herself  to be the  Treasurer  of ARIZONA  PUBLIC  SERVICE  COMPANY,  an Arizona
corporation, and that she, as such Treasurer being authorized so to do, executed
the foregoing instrument for the purposes therein contained, by signing the name
of the corporation by herself as Treasurer.

     IN WITNESS WHEREOF, I have hereunto set my hand and seal.


                                          Debra L. Blondin
                                          --------------------------------------
                                                       Notary Public

                                          My Commission Expires June 7, 2004
                                                                ----------------
[SEAL]


STATE OF ARIZONA                    )
                                    ) ss.:
COUNTY OF MARICOPA                  )

     On this  1st day of  November,  2002,  before  me,  Debra L.  Blondin,  the
undersigned officer, personally came Barbara M. Gomez, to me known, who being by
me duly sworn, did depose and say that she resides in Phoenix, Arizona, that she
is the Treasurer of ARIZONA PUBLIC SERVICE COMPANY, the corporation described in
and  which  executed  the  above  instrument;  that she  knows  the seal of said
corporation;  that the seal affixed to said  instrument is such corporate  seal;
that it was so affixed by order of the Board of Directors  of said  corporation,
and that she signed her name thereto by like order.

     IN WITNESS WHEREOF, I have hereunto set my hand and seal.


                                          Debra L. Blondin
                                          --------------------------------------
                                                       Notary Public

                                          My Commission Expires June 7, 2004
                                                                ----------------
[SEAL]


STATE OF ARIZONA                    )
                                    ) ss.:
COUNTY OF MARICOPA                  )

     This instrument was  acknowledged  before me on November 1, 2002 by Barbara
M.  Gomez  and  Betsy  A.  Pregulman,  as  Treasurer  and  Associate  Secretary,
respectively, of ARIZONA PUBLIC SERVICE COMPANY.


                                          Debra L. Blondin
                                          --------------------------------------
                                                       Notary Public

                                          My Commission Expires June 7, 2004
                                                                ----------------
[SEAL]

                                       43
<PAGE>
STATE OF NEW JERSEY                 )
                                    ) ss.:
COUNTY OF PASSAIC                   )

     On this 1st day of  November,  2002,  before me,  Ronald M.  Mania,  Notary
Public  in and for the  County  and  State  aforesaid,  residing  therein,  duly
commissioned and sworn,  personally appeared Debra A. Schwalb, known to me to be
a Vice President of THE BANK OF NEW YORK, a New York banking corporation,  which
executed the within  instrument,  and Thomas J. Provenzano,  known to me to be a
Vice President of The Bank of New York, who being by me duly sworn, acknowledged
before me that the seal affixed to said  instrument is the corporate seal of The
Bank of New York,  that they,  being  authorized  so to do,  executed the within
instrument  on  behalf  of The Bank of New  York by  authority  of its  board of
directors,  and that said instrument is the free act and deed of The Bank of New
York for the purposes therein contained.

     IN WITNESS  WHEREOF,  I have  hereunto  set my hand and affixed my official
seal the day and year in this certificate first above written.

                                          Ronald M. Mania
                                          --------------------------------------
                                                       Notary Public


                                          My Commission Expires     10/4/2006
                                                                ----------------
[SEAL]


STATE OF NEW JERSEY                 )
                                    ) ss.:
COUNTY OF PASSAIC                   )

     This instrument was acknowledged  before me on November 1, 2002 by Debra A.
Schwalb and Thomas J.  Provenzano,  each as a Vice  President of THE BANK OF NEW
YORK.

                                          Ronald M. Mania
                                          --------------------------------------
                                                       Notary Public


                                          My Commission Expires     10/4/2006
                                                                ----------------
[SEAL]