Exhibit 10.10(a)
                       PINNACLE WEST CAPITAL CORPORATION
                         ARIZONA PUBLIC SERVICE COMPANY
                           SUNCOR DEVELOPMENT COMPANY
                                       AND
                          EL DORADO INVESTMENT COMPANY
                           DEFERRED COMPENSATION PLAN





<PAGE>



                                TABLE OF CONTENTS




ARTICLE 1 - Definitions..................................................... 1

ARTICLE 2 - Selection, Enrollment, Eligibility.............................. 6

         2.1               Selection by Committee........................... 6
         2.2               Enrollment Requirements.......................... 6
         2.3               Eligibility; Commencement of Participation....... 6
         2.4               Loss of Eligibility to Participate............... 6

ARTICLE 3 - Deferral Commitments/Interest Crediting......................... 6

         3.1               Deferral......................................... 6
         3.2               Maximum Deferral................................. 7
         3.3               Election to Defer; Effect of Election Form....... 7
         3.4               Withholding of Deferral Amounts.................. 7
         3.5               Interest Crediting Prior to Distribution......... 7
         3.6               Installment Distribution......................... 7
         3.7               FICA Taxes....................................... 8

ARTICLE 4 - Short-Term Payout and Unforeseeable Financial
                    Emergencies............................................. 8

         4.1               Short-Term Payout................................ 8
         4.2               Withdrawal Payout; Suspensions for
               Unforeseeable Financial Emergencies.......................... 9

ARTICLE 5 - Retirement Benefit.............................................. 9

         5.1               Retirement Benefit............................... 9
         5.2               Payment of Retirement Benefits................... 9
         5.3               Death Prior to Completion of Retirement
               Benefits..................................................... 9

ARTICLE 6 - Pre-Retirement Survivor Benefit.................................10

         6.1               Pre-Retirement Survivor Benefit..................10
         6.2               Payment of Pre-Retirement Survivor Benefits......10
         6.3               Restriction in the Event of Suicide or Falsely
               Provided Information.........................................10

ARTICLE 7 - Termination Benefit.............................................10

         7.1               Termination Benefits.............................10
         7.2               Payment of Termination Benefit...................11
         7.3               Death Prior to Pay Out...........................11



                                       -i-

<PAGE>



ARTICLE 8 - Disability Waiver and Benefit...................................12

         8.1               Disability Waiver................................12
         8.2               Disability Benefit...............................12

ARTICLE 9 - Beneficiary Designation.........................................13

         9.1               Beneficiary......................................13
         9.2               Beneficiary Designation and Change; Spousal
                           Consent..........................................13
         9.3               Acknowledgment...................................13
         9.4               No Beneficiary Designation.......................13
         9.5               Doubt as to Beneficiary..........................13
         9.6               Discharge of Obligations.........................14

ARTICLE 10 - Leave of Absence...............................................14

         10.1              Paid Leave of Absence............................14
         10.2              Unpaid Leave of Absence..........................14

ARTICLE 11 - Termination, Amendment or Modification.........................14

         11.1              Termination......................................14
         11.2              Amendment........................................15
         11.3              Interest Rate in the Event of a Change in
                           Control..........................................15
         11.4              Effect of Payment................................17

ARTICLE 12 - Administration.................................................17

         12.1              Committee Duties.................................17
         12.2              Agents...........................................17
         12.3              Binding Effect of Decisions......................17
         12.4              Indemnity of Committee...........................17
         12.5              Employer Information.............................17

ARTICLE 13 - Other Benefits and Agreements..................................18

         13.1              Coordination with Other Benefits.................18
         13.2              Transfers to the Plan............................18

ARTICLE 14 - Claims Procedures..............................................19

         14.1              Presentation of Claim............................19
         14.2              Notification of Decision.........................19
         14.3              Review of a Denied Claim.........................19
         14.4              Decision on Review...............................20
         14.5              Legal Action.....................................20



                                      -ii-

<PAGE>



ARTICLE 15 - Miscellaneous..................................................20

         15.1              Unsecured General Creditor.......................20
         15.2              Employer's Liability.............................20
         15.3              Nonassignability.................................21
         15.4              Not a Contract of Employment.....................21
         15.5              Furnishing Information...........................21
         15.6              Terms............................................21
         15.7              Captions.........................................21
         15.8              Governing Law....................................21
         15.9              Validity.........................................21
         15.10             Notice...........................................22
         15.11             Successors.......................................22
         15.12             Spouse's Interest................................22
         15.13             Incompetent......................................22



                                      -iii-

<PAGE>



                        PINNACLE WEST CAPITAL CORPORATION
                         ARIZONA PUBLIC SERVICE COMPANY
                           SUNCOR DEVELOPMENT COMPANY
                                       AND
                          EL DORADO INVESTMENT COMPANY
                           DEFERRED COMPENSATION PLAN


          Effective  January 1, 1992,  Pinnacle  West  Capital  Corporation,  an
Arizona  corporation  (the  "Company"),  established  the Pinnacle  West Capital
Corporation,  Arizona Public Service Company,  SunCor Development Company and El
Dorado  Investment  Company  Deferred  Compensation  Plan (the  "Plan")  for the
purpose of providing specified benefits to a select group of management,  highly
compensated  employees and Directors who contribute  materially to the continued
growth,  development and future business success of the Company,  Arizona Public
Service Company,  SunCor Development  Company, El Dorado Investment Company, and
their  subsidiaries.  The Plan was thereafter  amended  several  times.  By this
amendment and  restatement in the entirety,  the Company  intends to incorporate
all prior amendments and to make certain technical and clarifying revisions.


                                    ARTICLE 1
                                   Definitions

          For  purposes  hereof,  unless  otherwise  clearly  apparent  from the
context,  the  following  phrases or terms  shall have the  following  indicated
meanings:

1.1       "Account Balance" shall mean the sum of (i) the Deferral Amount,  plus
          (ii) interest credited in accordance with all the applicable  interest
          crediting  provisions of the Plan, reduced by all Short-Term  Payouts,
          if made.  This account shall be a bookkeeping  entry only and shall be
          utilized solely as a device for the measurement and  determination  of
          the amounts to be paid to the Participant pursuant to this Plan.

1.2       "Annual  Deferral"  shall mean that  portion of a  Participant's  Base
          Annual Salary, Year-End Bonus and/or Directors Fees that a Participant
          elects to have and is deferred,  in accordance with Article 3, for any
          one Plan Year.  In the event of Re- tirement,  Disability,  death or a
          Termination of Employment prior to the end of a Plan Year, such year's
          Annual  Deferral  shall be the actual  amount  withheld  prior to such
          event.


                                        1

<PAGE>



1.3       "Base Annual  Salary"  shall mean the annual  compensation,  excluding
          bonuses,  commissions,   overtime,  incentive  payments,  non-monetary
          awards,  Directors  Fees and other  fees,  paid to a  Participant  for
          employment  services  rendered to any Employer,  before  reduction for
          compensation  deferred  pursuant to all qualified,  non-qualified  and
          Code Section 125 compensation plans of any Employer.

1.4       "Beneficiary" shall mean one or more persons, trusts, estates or other
          entities,  designated in accordance  with Article 9, that are entitled
          to receive benefits under this Plan upon the death of a Participant.

1.5       "Beneficiary  Designation  Form" shall mean the form  established from
          time to time by the Committee that a Participant completes,  signs and
          returns to the Committee to designate one or more Beneficiaries.

1.6       "Board" shall mean the Board of Directors of the Company.

1.7       "Bonus  Rate" for a Plan Year shall mean an interest  rate  determined
          for each Plan Year by the  Committee,  in its sole  discretion,  which
          rate shall be  determined  on or before the first  business day of the
          month that  precedes the beginning of the Plan Year for which the rate
          applies.

1.8       "Change in Control" shall have the meaning set forth in Section 11.3.

1.9       "Claimant" shall have the meaning set forth in Section 14.1.

1.10      "Code" shall mean the Internal Revenue Code of 1986, as amended.

1.11      "Committee"  shall  mean the  administrative  committee  appointed  to
          manage  and  administer  the Plan in  accordance  with its  provisions
          pursuant to Article 12.

1.12      "Company"  shall mean  Pinnacle West Capital  Corporation,  an Arizona
          corporation.

1.13      "Crediting  Rate" for a Plan Year shall mean a rate of interest  equal
          to the  ten-year  U.S.  Treasury  Note rate as  published  on the last
          business day of the first week of October preceding a Plan Year.

1.14      "Deferral"  shall  mean  the  sum  of all  of a  Participant's  Annual
          Deferrals.

1.15      "Director"  shall  mean any  member  of the board of  directors  of an
          Employer.


                                        2

<PAGE>



1.16      "Directors  Fees"  shall  mean the  annual  fees paid by an  Employer,
          including retainer fees and meetings fees, as compensation for serving
          on a board of directors of an Employer.

1.17      "Disability"  shall  mean  a  period  of  disability  during  which  a
          Participant qualifies for benefits under the Participant's  Employer's
          long-term disability plan or, if a Participant does not participate in
          such a plan, a period of disability during which the Participant would
          have  qualified  for benefits  under such a plan, as determined in the
          sole  discretion  of  the  Committee,   had  the  Participant  been  a
          participant in such a plan.

1.18      "Disability Benefit" shall mean the benefit set forth in Article 8.

1.19      "Effective Date" shall mean January 1, 1996.

1.20      "Election Form" shall mean the form  established  from time to time by
          the Committee that a Participant  completes,  signs and returns to the
          Committee to make an election under the Plan.

1.21      "Employer" shall mean the Company,  Arizona Public Service Company, an
          Arizona   corporation,   SunCor   Development   Company,   an  Arizona
          corporation,  El Dorado Investment  Company,  an Arizona  corporation,
          and/or any subsidiaries of such  corporations  that have been selected
          by the Board to participate in the Plan.

1.22      "Participant"  shall mean any  employee or Director of an Employer (i)
          who is  selected  to  participate  in the  Plan,  (ii) who  elects  to
          participate in the Plan, (iii) who signs a Plan Agreement, an Election
          Form and a  Beneficiary  Designation  Form,  (iv)  whose  signed  Plan
          Agreement, Election Form and Beneficiary Designation Form are accepted
          by the Committee,  (v) who commences  participation in the Plan on his
          or her  Plan  Entry  Date,  and  (vi)  whose  Plan  Agreement  has not
          terminated.

1.23      "Plan"  shall mean the  Pinnacle  West  Capital  Corporation,  Arizona
          Public  Service  Company,  SunCor  Development  Company  and El Dorado
          Investment   Company  Deferred   Compensation  Plan,  which  shall  be
          evidenced by this  instrument and by each Plan  Agreement,  as amended
          from time to time.

1.24      "Plan Agreement" shall mean a written agreement,  as amended from time
          to time,  which is  entered  into by and  between  an  Employer  and a
          Participant.  Each Plan  Agreement  executed  by a  Participant  shall
          provide for the entire  benefit to which such  Participant is entitled
          to under the Plan, and the Plan  Agreement  bearing the latest date of
          acceptance by the Committee shall govern such entitlement.

                                        3

<PAGE>




1.25      "Plan  Entry  Date"  shall  mean one of two  dates in any Plan Year on
          which an employee or Director selected by the Committee to participate
          in the  Plan is  eligible  to  commence  participation  in the Plan in
          accordance  with Article 3. The two entry dates are January 1 and July
          1.

1.26      "Plan Year" shall begin on January 1 of each year and continue through
          December 31.

1.27      "Preferred  Rate" for a Plan Year shall mean the  Crediting  Rate plus
          the Bonus Rate for such Plan Year.

1.28      "Pre-Retirement  Survivor Benefit" shall mean the benefit set forth in
          Article 6.

1.29      "Retirement"  and "Retires"  shall mean,  with respect to an employee,
          severance from employment with all Employers for any reason other than
          a leave of absence, death or Disability on or after the earlier of the
          attainment of (a) age  sixty-five  (65) with five (5) Years of Service
          or (b) age fifty-five  (55) with ten (10) Years of Service;  and shall
          mean, with respect to a Director who is not an employee,  severance of
          his or her directorship(s)  with all Employers on or after the earlier
          of the  attainment of (x) age  sixty-five  (65) with five (5) Years of
          Service as a Director or (y) age  fifty-five  (55) with ten (10) Years
          of Service as a Director.  If a Participant  is both an employee and a
          Director,  Retirement  shall not occur until he or she Retires as both
          an   employee  and  a   Director;  provided,   however,  that  such  a
          Participant  may elect, in accordance with the policies and procedures
          established by the  Committee,  to Retire for purposes of this Plan at
          the time he or she Retires as an employee of all Employers.

1.30      "Retirement Benefit" shall mean the benefit set forth in Article 5.

1.31      "SEBP"  shall mean the  Pinnacle  West  Capital  Corporation,  Arizona
          Public  Service  Company,  SunCor  Development  Company  and El Dorado
          Investment  Company  Supplemental  Executive Benefit Plan, as the same
          may be amended from time to time.

1.32      "Short-Term Payout" shall mean the payout set forth in Section 4.1.

1.33      "Termination Benefit" shall mean the benefit set forth in Article 7.

1.34      "Termination of Employment" shall mean the ceasing of employment by an
          employee  with all  Employers or ceasing  service as a Director of all
          Employers,  voluntarily  or  involuntarily,  for any reason other than
          Retirement, Disability, leave of absence or death. If a Participant is
          both an employee and a Direc-

                                        4

<PAGE>



          tor, a Termination of Employment shall occur only upon the termination
          of the last position held; provided,  however, that such a Participant
          may elect, in accordance with the policies and procedures  established
          by the  Committee,  to be treated for  purposes of this Plan as having
          experienced a  Termination  of Employment at the time he or she ceases
          employment with all Employers as an employee.

1.35      "Unforeseeable   Financial  Emergency"  shall  mean  an  unanticipated
          emergency  that is  caused  by an  event  beyond  the  control  of the
          Participant  that  would  cause  severe  financial   hardship  to  the
          Participant  as a result of (i) a sudden  and  unexpected  illness  or
          accident of the Participant or a dependent of the Participant,  (ii) a
          loss of the Participant's property due to casualty or (iii) such other
          extraordinary and unforeseeable  circumstances  arising as a result of
          events beyond the control of the Participant, all as determined in the
          sole discretion of the Committee.

1.36      "Year-End Bonus" shall mean  compensation paid to a Participant who is
          an employee as an annual  bonus under any  Employer's  regular  annual
          bonus and incentive plans.  Special bonuses or incentive payments made
          to a Participant shall not constitute "Year-End Bonuses."

1.37      "Years of Plan Participation" shall mean the total number of full Plan
          Years a Participant  has been a participant in the Plan and has either
          (i) made  deferral  elections  or (ii)  had an  Account  Balance.  For
          purposes of a Participant's first Plan Year of participation only, any
          partial  Plan Year of partici-  pation shall be treated as a full Plan
          Year. A single Plan Year of Plan  participation  described above shall
          be referred to as a "Year of Plan Participation."

1.38      "Years of Service"  shall mean the total number of years of employment
          during which a Participant has been credited with at least 1,000 hours
          of service in each of those  years.  For  purposes of this  definition
          only, (i)  Participants  who are employees  shall be credited with ten
          (10)  hours of service  for each  working  day  during  which they are
          employed by the Employer and  Participants  who are Directors shall be
          credited  with ten (10)  hours of  service  for each day  (other  than
          weekend days) during which they serve as a Director,  provided that no
          Participant shall be credited with more than 1,000 hours of service in
          any one year of employment,  and (ii) a year of employment  shall be a
          365 day period  (or 366 day  period in the case of a leap year)  that,
          for the first year of employment,  commences on the employee's date of
          hiring or the date the  Director  begins his service as a Director and
          that,  for any  subsequent  year,  commences on an anniversary of that
          date.


                                        5

<PAGE>




                                    ARTICLE 2
                       Selection, Enrollment, Eligibility

2.1       Selection by Committee.  Participation in the Plan shall be limited to
          a  select  group  of  management,  highly  compensated  employees  and
          Directors  of the  Employers.  From that group,  the  Committee  shall
          select,  in  its  sole  discretion,  employees  and  Directors  of the
          Employers to participate in the Plan.

2.2       Enrollment  Requirements.  As  a  condition  to  participation,   each
          selected  employee or Director shall  complete,  execute and return to
          the  Committee a Plan  Agreement,  an Election  Form and a Beneficiary
          Designation Form. In addition, the Committee,  in its sole discretion,
          shall establish from time to time such other  enrollment  requirements
          as it determines in its sole discretion are necessary.

2.3       Eligibility; Commencement of Participation. If an employee or Director
          selected  to   participate   in  the  Plan  has  met  all   enrollment
          requirements  set forth in this Plan and  required  by the  Committee,
          that employee or Director shall commence  participation in the Plan on
          the Plan Entry Date that immediately  follows  his or her selection to
          participate  in the Plan. If a selected  employee or Director fails to
          meet all  such  requirements  prior  to that  Plan  Entry  Date,  that
          employee or Director  shall not be eligible to participate in the Plan
          until the Plan Entry Date that follows his or her  completion of those
          requirements.

2.4       Loss of  Eligibility  to  Participate.  If the status of a Participant
          changes, without Termination of Employment, so that he is no longer an
          employee  eligible  to  participate  pursuant to Section 2.1 or if the
          Committee fails to designate a Participant for continued participation
          as required under Section 2.1, he shall become an inactive Participant
          as of the last day of the Plan Year in which such  change of status or
          such failure by the Committee  occurred.  Inactive  Participants shall
          continue to  participate  in the Plan for all purposes  other than for
          purposes of making deferrals under Section 3.1 and 3.2.


                                    ARTICLE 3
                     Deferral Commitments/Interest Crediting

3.1       Deferral.  Subject to Section 3.2 below, a Participant may defer,  for
          each Plan Year starting with his or her  commencement of participation
          in the Plan and  ending  immediately  prior to his or her  Retirement,
          death or Termination of Employment,  none or any portion of his or her
          Base Annual Salary, Year-End Bonus and/or Directors Fees.


                                        6

<PAGE>



3.2       Maximum  Deferral.  For each Plan Year, a Participant  may defer up to
          fifty  percent  (50%)  of his or her  Base  Annual  Salary,  up to one
          hundred  percent  (100%) of his or her Year-End Bonus and/or up to one
          hundred percent (100%) of his or her Directors Fees.

3.3       Election  to Defer;  Effect of Election  Form.  In  connection  with a
          Participant's   commencement  of   participation   in  the  Plan,  the
          Participant  may elect to defer  from his or her Base  Annual  Salary,
          Year-End Bonus and/or  Directors Fees an Annual Deferral by delivering
          to the Committee a completed  Election  Form,  which election and form
          must be accepted by the Committee for a valid  election to exist.  For
          each succeeding Plan Year, a new Election Form for a Plan Year must be
          delivered  to  the  Committee,   in  accordance  with  its  rules  and
          procedures,  before the end of the immediately preceding Plan Year. If
          no Election  Form is delivered and accepted for a Plan Year, no Annual
          Deferral will be withheld for that Plan Year.

3.4       Withholding of Deferral  Amounts.  For each Plan Year, the Base Annual
          Salary  portion of the Annual  Deferral shall be withheld each payroll
          period from the Participant's Base Annual Salary in equal amounts. The
          Year-End Bonus and/or  Directors  Fees portion of the Annual  Deferral
          shall be withheld at the time the Year-End Bonus and/or  Director Fees
          are or would otherwise be paid to the Participant.

3.5       Interest Crediting Prior to Distribution. Prior to any distribution of
          benefits  under  Articles 4, 5, 6, 7 or 8, interest  shall be credited
          and compounded  annually on a Participant's  Account Balance as though
          the Annual  Deferral for that Plan Year was withheld at the  beginning
          of the  Plan  Year  or,  in  the  case  of  the  first  year  of  Plan
          participation,  was withheld on the Participant's Plan Entry Date. The
          rate of interest for  crediting  shall be the Preferred  Rate,  unless
          otherwise   provided  in  this  Plan.  In  the  event  of  Retirement,
          Disability, death or a Termination of Employment prior to the end of a
          Plan Year,  the basis for that  year's  interest  crediting  will be a
          fraction  of the full  year's  interest  based on the amount  actually
          deferred  for  the  Plan  Year  as of the  date  of the  Participant's
          Retirement,  Disability,  death or Termination of Employment and based
          further on the number of full months that the Participant was employed
          with or served as a  Director  of the  Employer  during  the Plan Year
          prior to the occurrence of such event. If a Short-Term Payout is made,
          for  purposes of  crediting  interest,  the Account  Balance  shall be
          reduced  as of the first day of the Plan Year in which the  Short-Term
          Payout is made.

3.6       Installment   Distribution.   In  the  event  a  benefit  is  paid  in
          installments under Articles 5, 6, 7 or 8, installment  payment amounts
          shall be determined in the following manner:

                                        7

<PAGE>




          (a)  Interest  Rate.  The  interest  rate  to  be  used  to  calculate
          installment  payment  amounts  shall be a fixed  interest rate that is
          determined by averaging the Preferred Rates for the Plan Year in which
          a Participant  becomes  eligible to receive a benefit and the four (4)
          preceding Plan Years.  If a Participant  has completed fewer than five
          (5) Plan Years,  this average shall be determined  using the Crediting
          Rates for the Plan Years during which the Participant  participated in
          the Plan. Notwithstanding the foregoing, if the terminated Participant
          elects   installment   distributions   at  age  fifty-five  (55),  the
          applicable interest rate(s) to be used from the termination date until
          age fifty-five  (55) shall be determined in accordance  with the table
          set forth in Section  7.1, by using the  Crediting  Rates or Preferred
          Rates, as the case may be.

          (b)  Installment  Payments.  For purposes of  calculating  installment
          payment amounts,  each annual installment  payment,  starting with the
          first  payment  [which for this purpose is deemed to be paid as of the
          date that the Participant  becomes eligible to receive a benefit under
          this Plan (the "Eligibility Date")] and continuing thereafter for each
          additional year that starts on the anniversary of the Eligibility Date
          until the  Participant's  Account  Balance  is paid in full,  shall be
          deemed to have been paid prior to the  crediting  of interest for that
          year.  (The result of this is that  interest  crediting  shall be made
          after  taking  into  account the annual  installment  payment for that
          year.)

          (c) Amortization.  Based on the interest rate determined in accordance
          with Section 3.6(b) above, the Participant's  Account Balance shall be
          amortized in equal installment payments over the term of the specified
          payment period. The resulting number shall be the installment  payment
          that is to be paid each year.

3.7       FICA  Taxes.  For each Plan Year in which an Annual  Deferral is being
          withheld,  the  Participant's  Employer(s) shall ratably withhold from
          that portion of the Participant's Base Annual Salary that is not being
          deferred,  the  Participant's  share of FICA taxes  based on an amount
          equal  to the  Base  Annual  Salary  before  reduction  by the  Annual
          Deferral.


                                    ARTICLE 4
            Short-Term Payout and Unforeseeable Financial Emergencies

4.1       Short-Term Payout. In connection with each election to defer an Annual
          Deferral,  a  Participant  may elect to  receive  a future  Short-Term
          Payout  from  the Plan  with  respect  to that  Annual  Deferral.  The
          Short-Term  Payout  shall be a lump sum  payment in an amount  that is
          equal to the Annual  Deferral plus interest  credited at the Preferred
          Rate, and it shall be paid

                                        8

<PAGE>



          within  sixty (60) days of the first day of the Plan Year that is five
          (5) years  after  the  first day of the Plan Year in which the  Annual
          Deferral is actually deferred.  Notwithstanding the foregoing, amounts
          transferred  to this  Plan  pursuant  to  Section  13.2  shall  not be
          eligible for a Short-Term Payout.

4.2       Withdrawal   Payout;    Suspensions   for   Unforeseeable    Financial
          Emergencies. If the Participant experiences an Unforeseeable Financial
          Emergency, the Participant may  petition the Committee  to (i) suspend
          any deferrals required to be made by a Participant and/or (ii) receive
          a partial or full  payout from the Plan.  The payout  shall not exceed
          the lesser of (i) the Participant's Account Balance,  calculated as if
          such Participant  were receiving a  Termination  Benefit,  or (ii) the
          amount  reasonably  needed  to  satisfy  the  Unforeseeable  Financial
          Emergency.  If, subject  to the sole discretion  of the Committee, the
          petition for a suspension and/or payout is approved,  suspension shall
          take  effect upon the date of  approval  and any payout  shall be made
          within sixty (60) days of the date of approval.


                                    ARTICLE 5
                               Retirement Benefit

5.1       Retirement  Benefit.  A Participant  who Retires shall  receive,  as a
          Retirement Benefit, his or her Account Balance.

5.2       Payment of Retirement Benefits. A Participant,  in connection with his
          or her  commencement of  participation  in the Plan, shall elect on an
          Election  Form to receive the  Retirement  Benefit in a lump sum or in
          equal annual  payments  over a period of five (5), ten (10) or fifteen
          (15) years (the  latter  determined  in  accordance  with  Section 3.6
          above).  The Partic-  ipant may change this  election to an  allowable
          alternative  payout  period by  submitting a new Election  Form to the
          Commit-  tee,  provided  that any such  Election  Form is submitted at
          least two (2) years prior to the Participant's Retirement.  Subject to
          the  foregoing,  the  Election  Form  most  recently  accepted  by the
          Committee shall govern the payout of the Retirement Benefit.  The lump
          sum payment shall be made, or installment payments shall commence,  no
          later than sixty (60) days from the date the Participant Retires.

5.3       Death Prior to  Completion of  Retirement  Benefits.  If a Participant
          dies after  Retirement  but before the  Retirement  Benefit is paid in
          full,  the  Participant's  unpaid  Retirement  Benefit  payments shall
          continue and shall be paid to the  Participant's  Beneficiary over the
          remaining  number of years  and in the same  amounts  as that  benefit
          would have been paid to the Participant had the Participant survived.


                                        9

<PAGE>




                                    ARTICLE 6
                         Pre-Retirement Survivor Benefit

6.1       Pre-Retirement  Survivor  Benefit.  Except as  provided in Section 6.3
          below, if a Participant  dies before he or she Retires,  experiences a
          Termination of Employment or suffers a Disability,  the  Participant's
          Beneficiary shall receive a Pre- Retirement  Survivor Benefit equal to
          the Participant's Account Balance.

6.2       Payment of  Pre-Retirement  Survivor  Benefits.  The Pre-Retire-  ment
          Survivor  Benefit  shall  be  paid  in a  lump  sum.  However,  if the
          Pre-Retirement  Survivor Benefit exceeds $25,000,  payment may, at the
          sole  discretion of the Committee,  be made in equal monthly  payments
          over a period of time. In no event, however, shall that period of time
          exceed the payment period  previously  elected by the  Participant for
          the payment of the  Retirement  Benefit,  or, if no election was made,
          fifteen (15) years.  The first (or only payment,  if made in lump sum)
          shall be made  within  sixty  (60) days of the  Committee's  receiving
          proof of the Participant's death.

6.3       Restriction in the Event of Suicide or Falsely  Provided  Information.
          In the event of a Participant's suicide within two (2) years after the
          Participant   first  becomes  a  Participant,  or  in  the  event  the
          Participant's  death is determined to be from a bodily or mental cause
          or  causes,  the  information  about  which  was  withheld,  knowingly
          concealed,  or falsely  provided by the  Participant  if  requested to
          furnish evidence of good health, the  Pre-Retirement  Survivor Benefit
          shall be equal to the Participant's  Deferral,  without interest,  all
          determined as of his or her date of death.


                                    ARTICLE 7
                               Termination Benefit

7.1       Termination Benefits. If the Participant  experiences a Termination of
          Employment  prior to his or her Retirement,  death or Disability,  the
          Participant  shall  receive  a  Termination  Benefit,  which  shall be
          equal to the  Participant's  Account  Balance as of the date of his or
          her  Termination of Employment,  with interest  credited in the manner
          provided in Section 3.5 above, but using the applicable  interest rate
          set forth in the following schedule:


 Completion of Years of Plan Participation
    Prior to Termination of Employment             Applicable Rate
 -----------------------------------------         ---------------

           Less than five years                    Crediting Rate

            Five or more years                     Preferred Rate



                                       10

<PAGE>




7.2       Payment of Termination Benefit.

          (a)  Lump  Sum  or  Installments.   In  connection  with  his  or  her
          commencement of participation  in the Plan, a Participant  shall elect
          on an Election Form to receive the  Termination  Benefit in a lump sum
          or in equal annual payments (the latter  determined in accordance with
          Section 3.6 above) over a period of five (5), ten (10) or fifteen (15)
          years.  If a  Participant  elects a lump sum payment,  he or she shall
          specify  whether the lump sum will be paid  within  sixty (60) days of
          (i) his or her Termination of Employment or (ii) his or her attainment
          of age  fifty-five  (55) following  Termination of Employment.  If the
          Participant elects installment payments,  they will begin within sixty
          (60)  days  of  the  Participant's   55th  birthday  (or  his  or  her
          Termination of Employment,  if the  Participant is over age fifty-five
          (55) upon his or her Termination of  Employment).  The Participant may
          change his or her election to an allowable  alternative  payout period
          by submitting a new Election Form to the Committee,  provided that any
          such  Election  Form is  submitted at least two (2) years prior to the
          Participant's  Termination  of  Employment  and  is  accepted  by  the
          Committee in its sole discretion.  Notwithstanding the foregoing, each
          Participant in the Plan shall be given an  opportunity  during 1995 to
          make an election with respect to his or her Termination  Benefit,  and
          such  election,  if accepted by the Committee,  shall be treated,  for
          purposes  of this  Section  7.2(a),  as the initial  election  for the
          payment of the Termination  Benefit.  Failure to make an election will
          result in the  Termination  Benefit  paid in a lump sum at the time of
          the Participant's Termination of Employment.

               Subject  to  the  foregoing,  the  Election  Form  most  recently
          accepted by the Committee  shall govern the payout of the  Termination
          Benefit.

          (b) Commencement of Payments. Payment of the Termination Benefit shall
          commence within sixty (60) days of the date elected by the Participant
          in accordance with Section 7.2(a) above.

7.3       Death Prior to Pay Out.

          (a) Death Prior to  Commencement  of Payments.  If a Participant  dies
          prior  to the  payout  date  that  he or she  elected  for  his or her
          Termination Benefit, his or her Termination Benefit shall be paid in a
          lump  sum  within  sixty  (60)  days of the date  that  the  Committee
          receives proof of the Participant's death.

          (b)  Death  After  Commencement.  If  a  Participant  dies  after  the
          commencement of the payment of his or her Termination

                                       11

<PAGE>



          Benefit,  but before  the  Termination  Benefit  is paid in full,  the
          Participant's  unpaid Termination  Benefit payments shall continue and
          shall be paid to the  Participant's  Beneficiary  over  the  remaining
          number of years and in the same  amounts  as that  benefit  would have
          been paid to the Participant had the Participant survived.


                                    ARTICLE 8
                          Disability Waiver and Benefit

8.1       Disability Waiver.

          (a)  Eligibility.  By  participating in the Plan, all Participants are
          eligible for this waiver.

          (b)  Waiver  of  Deferral;  Credit  for  Plan  Year of  Disability.  A
          Participant  who is determined by the Committee to be suffering from a
          Disability shall be excused from fulfilling that portion of the Annual
          Deferral  commitment  that would  otherwise  have been withheld from a
          Participant's Base Annual Salary, Year-End Bonus and/or Directors Fees
          for the Plan  Year  during  which  the  Participant  first  suffers  a
          Disability.  In addition,  the Participant's  Account Balance shall be
          credited with that portion of the Annual  Deferral  commitment that is
          excused  in  accordance  with  the  preceding  sentence,   unless  the
          Disability  ceases in the Plan Year that it commences,  in which case,
          the crediting shall apply only for the period of Disability.

          (c) Return to Work.  If a Participant  returns to  employment  with an
          Employer after a Disability ceases, the Participant may elect to defer
          an Annual  Deferral for the Plan Year  following  his or her return to
          employment and for every Plan Year thereafter;  provided such deferral
          elections are  otherwise  allowed and an Election Form is delivered to
          and accepted by the  Committee  for each such  election in  accordance
          with Section 3.3 above.

8.2       Disability  Benefit.  A Participant  suffering a Disability shall, for
          benefit  purposes  under this Plan,  continue to be  considered  to be
          employed  and  shall be  eligible  for the  benefits  provided  for in
          Articles  4, 5, 6 or 7 in  accordance  with  the  provisions  of those
          Articles.  Notwithstanding  the above,  the  Committee  shall have the
          right,  in its sole and absolute  discretion  and for purposes of this
          Plan only,  to terminate a  Participant's  employment  or service as a
          Director  at any time  after  such  Participant  is  determined  to be
          permanently  disabled under the  Participant's  Employer's  long- term
          disability  plan or  would  have  been  determined  to be  permanently
          disabled had he or she  participated  in that plan. In determining the
          Participant's Account Balance for purposes

                                       12

<PAGE>



          of the  Disability  Benefit  described in the previous  sentence,  the
          Preferred Rate shall be used in lieu of the rates specified in Section
          7.1.


                                    ARTICLE 9
                             Beneficiary Designation

9.1       Beneficiary.  Each  Participant  shall have the right, at any time, to
          designate his or her Beneficiary  (both primary as well as contingent)
          to receive any benefits  payable under the Plan to a Beneficiary  upon
          the death of a Participant.

9.2       Beneficiary  Designation and Change;  Spousal  Consent.  A Participant
          shall designate his or  her Beneficiary by  completing and signing the
          Beneficiary Designation Form, and returning it to the Committee or its
          designated  agent.  A  Participant  shall  have the  right to change a
          Beneficiary  by completing,  signing and otherwise  complying with the
          terms of the Beneficiary  Designation  Form and the Committee's  rules
          and  procedures,  as in effect  from time to time.  If the Participant
          names,  with  respect to more than fifty  percent  (50%) of his or her
          benefit  under  this Plan,  someone  other than his or her spouse as a
          Beneficiary,  a  spousal  consent,  in  the  form  designated  by  the
          Committee, must be signed by that Participant's spouse and returned to
          the  Committee.  Upon  the  acceptance  by  the  Committee  of  a  new
          Beneficiary Designation Form, all Beneficiary  designations previously
          filed shall be cancelled.  The Committee  shall be entitled to rely on
          the last  Beneficiary  Designation  Form filed by the  Participant and
          accepted by the Committee prior to his or her death.

9.3       Acknowledgment.   No   designation  or  change  in  designation  of  a
          Beneficiary   shall  be  effective   until   received,   accepted  and
          acknowledged in writing by the Committee or its designated agent.

9.4       No  Beneficiary  Designation.  If a  Participant  fails to designate a
          Beneficiary  as provided in Sections 9.1, 9.2 and 9.3 above or, if all
          designated  Beneficiaries  predecease the  Participant or die prior to
          complete  distribution  of  the  Participant's   benefits,   then  the
          Participant's  designated Beneficiary shall be deemed to be his or her
          surviving  spouse.  If the  Participant has no surviving  spouse,  the
          benefits remaining under the Plan to be paid to a Beneficiary shall be
          payable  to  the   executor   or   personal   representative   of  the
          Participant's estate.

9.5       Doubt as to  Beneficiary.  If the  Committee  has any  doubt as to the
          proper  Beneficiary  to receive  payments  pursuant to this Plan,  the
          Committee  shall have the right,  exercisable  in its  discretion,  to
          cause the Participant's Employer to

                                       13

<PAGE>



          withhold  such   payments   until  this  matter  is  resolved  to  the
          Committee's satisfaction.

9.6       Discharge of Obligations.  The payment of benefits under the Plan to a
          Beneficiary shall fully and completely discharge all Employers and the
          Committee from all further obligations under this Plan with respect to
          the Participant, and that Participant's Plan Agreement shall terminate
          upon such full payment of benefits.


                                   ARTICLE 10
                                Leave of Absence

10.1      Paid  Leave  of  Absence.  If  a  Participant  is  authorized  by  the
          Participant's  Employer for any reason to take a paid leave of absence
          from the employment of the Employer, the Participant shall continue to
          be considered  employed by the Employer and the Annual  Deferral shall
          continue  to  be  withheld  during  such  paid  leave  of  absence  in
          accordance with Section 3.3.

10.2      Unpaid  Leave  of  Absence.  If a  Participant  is  authorized  by the
          Participant's  Employer  for any  reason  to take an  unpaid  leave of
          absence from the  employment of the Employer,  the  Participant  shall
          continue to be considered employed by the Employer and the Participant
          shall be excused from making  deferrals  until the earlier of the date
          the leave of  absence  expires  or the  Participant  returns to a paid
          employment  status.  Upon such  expiration or return,  deferrals shall
          resume  for the  remaining  portion  of the  Plan  Year in  which  the
          expiration or return occurs,  based on the deferral election,  if any,
          made for that Plan Year prior to the leave of absence.


                                   ARTICLE 11
                     Termination, Amendment or Modification

11.1      Termination.  Any Employer reserves the right to terminate the Plan at
          any time with respect to  Participants  whose services are retained by
          that Employer.  Upon the  termination of the Plan, all Plan Agreements
          shall terminate and a Participant's  Account Balance shall be paid out
          in  accordance  with the  benefits  that the  Participant  would  have
          received  if  the   Participant   had  experienced  a  Termination  of
          Employment  on the date of Plan  termination  or, if Plan  termination
          occurs  after the date upon  which the  Participant  was  eligible  to
          Retire,  the Participant had Retired on the date of Plan  termination.
          Prior to a Change in Control,  the Employer  shall have the right,  in
          its sole  discretion,  and  notwithstanding  any elections made by the
          Participant,  to  pay  such  benefits  in a  lump  sum  or in  monthly
          installments for up to fifteen

                                       14

<PAGE>



          (15) years,  with interest  credited during the installment  period as
          provided in Section 3.6 but  utilizing an average of  Crediting  Rates
          instead of an average of Preferred  Rates.  After a Change in Control,
          the Employer shall be required to pay such benefits in a lump sum. The
          termination of the Plan shall not adversely  affect any Participant or
          Beneficiary  who has become  entitled to the  payment of any  benefits
          under the Plan as of the date of termination;  provided however,  that
          the Employer shall have the right to accelerate  installment  payments
          by paying the present  value  equivalent of such  payments,  using the
          Crediting  Rate for the Plan Year in which the  termination  occurs as
          the discount  rate,  in a lump sum or pursuant to a different  payment
          schedule.

11.2      Amendment.  The Company may, at any time,  amend or modify the Plan in
          whole  or in part  with  respect  to any  Employer  or all  Employers,
          provided,  however,  that no  amendment  or  modifica-  tion  shall be
          effective to decrease or restrict the present value equivalent,  using
          the Crediting Rate for the Plan Year of the amendment or  modification
          as the discount rate, of a Participant's  Account Balance in existence
          at the time the amendment or  modification  is made,  calculated as if
          the  Participant had experienced a Termination of Employment as of the
          effective date of the amendment or  modification,  or if the amendment
          or  modification  occurs after the date upon which the Participant was
          eligible to Retire,  the  Participant  had Retired as of the effective
          date of the amendment or  modification.  The amendment or modification
          of the Plan shall not affect any  Participant or  Beneficiary  who has
          become  entitled to the  payment of benefits  under the Plan as of the
          date of the  amendment or  modification;  provided  however,  that the
          Employer  effected by such  amendment or  modification  shall have the
          right to accelerate  installment  payments by paying the present value
          equivalent of such  payments,  using the  Crediting  Rate for the Plan
          Year of the amendment or  modification as the discount rate, in a lump
          sum or pursuant to a different payment schedule.

11.3      Interest Rate in the Event of a Change in Control.

          (a) Change in Control.  A "Change in Control" shall be deemed to occur
          six (6)  months  prior to the  occurrence  of the  first of any of the
          following events:

               (i) A change in control of the  Company of a nature that would be
               required to be reported in response to Item 6(e) of Schedule  14A
               of Regulation 14A  promulgated  under the Securities and Exchange
               Act of 1934 (the "Act"),  or any successor  regulation of similar
               import,  regardless  of  whether  the  Company is subject to such
               reporting requirement;


                                       15

<PAGE>



               (ii) A change in control of  ownership  of the Company  through a
               transaction or series of  transactions,  such that any person (as
               that term is used in Sections  13 and  14(d)(2) of the Act) is or
               becomes  the  beneficial  owner (as that term is used in  Section
               13(d) of the Act),  directly or indirectly,  of securities of the
               Company representing twenty percent (20%) or more of the combined
               voting power of the Company's then outstanding securities;

               (iii) Any  consolidation  or merger of the  Company  in which the
               Company  is  not  the  continuing  or  surviving  corporation  or
               pursuant to which shares of the common stock of the Company would
               be converted into cash, securities or other property,  other than
               a merger of the Company in which the holders of the common  stock
               of the  Company  immediately  prior to the  merger  have the same
               proportionate   ownership  of  common  stock  of  the   surviving
               corporation immediately after the merger;

               (iv) The shareholders of the Company approve any plan or proposal
               for the liquidation or dissolution of the Company;

               (v) During any period of two (2) consecutive  years,  individuals
               who,  at the  beginning  of such  period,  constituted  the Board
               cease, for any reason, to constitute at least a majority thereof,
               unless  the  election  or  nomination  for  election  of each new
               director was approved by the vote of at least two-thirds (2/3) of
               the  directors  then  still in office who were  directors  at the
               beginning of the period;

               (vi)  Substantially  all of the  assets  of the  Company  and its
               subsidiaries, in the aggregate, are sold or otherwise transferred
               to  parties   that  are  not  within  a   "controlled   group  of
               corporations"  (as defined in Section  1563 of Code) in which the
               Company is a member; or

               (vii)  More  than  eighty   percent   (80%)  of  the  stock,   or
               substantially all of the assets of, any Employer,  other than the
               Company,  are sold or otherwise  transferred  to parties that are
               not within a "controlled  group of  corporations"  (as defined in
               Section  1563 of the Code) in which  that  Employer  is a member,
               provided that any such event shall constitute a Change in Control
               only with respect to that Employer and its employees or Directors
               who are Participants.

          (b)  Interest  Rate.  If a Change in Control  occurs,  the  applicable
          interest rate to be used in determining a Partici-

                                       16

<PAGE>



          pant's benefit in connection  with a Termination  of Employment  after
          the  Change  in  Control,   or  a  Plan   termination,   amendment  or
          modification  under  Sections 11.1 and 11.2 after a Change in Control,
          shall be the Preferred  Rate.  The Crediting Rate for the Plan Year in
          which the Change in Control occurs,  and not the Preferred Rate, shall
          be used as the discount rate for determining present value.

11.4      Effect of Payment.  The full payment of the  applicable  benefit under
          Articles  5, 6, 7 or 8 of the  Plan  shall  completely  discharge  all
          obligations  to a  Participant  under this Plan and the  Participant's
          Plan Agreement shall terminate.


                                   ARTICLE 12
                                 Administration

12.1      Committee Duties. This Plan shall be administered by a Committee which
          shall  consist  of  persons  approved  by the  Board.  Members  of the
          Committee may be  Participants  under this Plan.  The Committee  shall
          also have the discretion and authority to make, amend, interpret,  and
          enforce  all  appropriate rules and regulations for the administration
          of this Plan and decide or  resolve  any and all  questions  including
          interpretations  of this  Plan,  as may arise in  connection  with the
          Plan.

12.2      Agents.  In the  administration  of this Plan, the Committee may, from
          time to time,  employ agents and delegate to them such  administrative
          duties as it sees fit and may from time to time  consult  with counsel
          who may be counsel to any Employer.

12.3      Binding  Effect of Decisions.  The decision or action of the Committee
          with respect to any question  arising out of or in connection with the
          administration,  interpretation  and  application  of the Plan and the
          rules  and  regulations  promulgated  hereunder  shall  be  final  and
          conclusive  and binding  upon all persons  having any  interest in the
          Plan.

12.4      Indemnity  of  Committee.  All  Employers  shall  indemnify  and  hold
          harmless  the  members of the  Committee  against  any and all claims,
          losses,  damages,  expenses or liabilities  arising from any action or
          failure  to act  with  respect  to this  Plan,  except  in the case of
          willful misconduct by the Committee or any of its members.

12.5      Employer   Information.   To  enable  the  Committee  to  perform  its
          functions,  each Employer shall supply full and timely  information to
          the  Committee  on all  matters  relating to the  compensation  of its
          Participants, the date and circumstances

                                       17

<PAGE>



          of the Retirement,  Disability,  death or Termination of Employment of
          its  Participants,   and  such  other  pertinent  information  as  the
          Committee may reasonably require.


                                   ARTICLE 13
                          Other Benefits and Agreements

13.1      Coordination with Other Benefits.  Except as provided in this Section,
          the benefits provided for a Participant and Participant's  Beneficiary
          under the Plan are in addition to any other benefits available to such
          Participant under any other plan or program for employees or directors
          of the Participant's Employer. The Plan shall supplement and shall not
          supersede,  modify or amend any other such plan or  program  except as
          may otherwise be expressly provided.

               In the  event a  Participant  receives  or  becomes  entitled  to
          receive a benefit  under the SEBP,  the benefits to be received  under
          this Plan  shall be offset  and  reduced  (but not below  zero) by the
          benefits  paid under the SEBP. In  determining  the amount that should
          offset and reduce  benefits under this Plan, the amount paid under the
          SEBP shall be  translated  into its future value by assuming it earned
          interest  from the date of payment to the  Participant,  in accordance
          with the crediting provisions of Sections 3.5 and 3.6, to the date the
          benefit under this Plan becomes due and payable.

13.2      Transfers to the Plan.  Any  Participant  who was a participant in the
          Arizona  Public  Service  Company  Deferred   Compensation  Plan,  the
          Pinnacle West Capital  Corporation  Deferred  Compen- sation Plan, the
          Arizona Public Service Company Directors'  Deferred  Compensation Plan
          or  the  Pinnacle  West  Capital   Corporation   Directors'   Deferred
          Compensation  Plan prior to becoming a Participant  in this Plan shall
          have the  right to  elect,  upon the date  upon  which he or she first
          becomes  designated for  participation in the Plan, to transfer his or
          her Deferral  Option I account balance in that plan to this Plan. This
          election  shall be made in accordance  with the rules and on the forms
          established  from time to time by the  Committee.  If the  election is
          made, the  Participant's  Deferral  Option I account balance under the
          other plan  shall be added to his or her  Account  Balance  under this
          Plan and any such transferred  account balance shall become subject to
          the terms and  conditions  of this Plan.  Upon the  completion  of the
          transfer  of his or her account  balance  under the other plan to this
          Plan,  the  Participant's  participation  in Deferral  Option I of the
          other  plan  shall  terminate  and he or she  shall  have  no  further
          interest in Deferral Option I of that plan.



                                       18

<PAGE>



                                   ARTICLE 14
                                Claims Procedures

14.1      Presentation  of Claim.  Any  Participant or Beneficiary of a deceased
          Participant  (such  Participant or Beneficiary being referred to below
          as a  "Claimant")  may deliver to the  Committee a written claim for a
          determination  with  respect  to the  amounts  distributable  to  such
          Claimant  from the Plan.  If such a claim relates to the contents of a
          notice  received by the Claimant,  the claim must be made within sixty
          (60) days after such notice was  received by the  Claimant.  All other
          claims must be made within one hundred  eighty  (180) days of the date
          on which the event that caused the claim to arise occurred.  The claim
          must  state  with  particularity  the  determination  desired  by  the
          Claimant.

14.2      Notification  of Decision.  The Committee  shall consider a Claimant's
          claim  within a  reasonable  time,  and shall  notify the  Claimant in
          writing:

          (a) that the  Claimant's  requested  determination  has been made, and
          that the claim has been allowed in full; or

          (b) that the Committee has reached a conclusion contrary,  in whole or
          in part, to the Claimant's  requested  determination,  and such notice
          must  set  forth  in a  manner  calculated  to be  understood  by  the
          Claimant:

               (i) the specific  reason(s)  for the denial of the claim,  or any
               part of it;

               (ii) specific  reference(s)  to pertinent  provisions of the Plan
               upon which such denial was based;

               (iii) a description  of any  additional  material or  information
               necessary  for  the  Claimant  to  perfect  the  claim,   and  an
               explanation of why such material or information is necessary; and

               (iv) an  explanation  of the claim review  procedure set forth in
               Section 14.3 below.

14.3      Review of a Denied  Claim.  Within  sixty (60) days after  receiving a
          notice from the Committee that a claim has been denied, in whole or in
          part, a Claimant (or the Claimant's  duly  authorized  representative)
          may file  with the  Committee  a written  request  for a review of the
          denial of the claim.  Thereafter,  but not later than thirty (30) days
          after the review procedure began, the Claimant (or the Claimant's duly
          authorized representative):

               (a) may review pertinent documents;

                                       19

<PAGE>




               (b) may submit written comments or other documents; and/or

               (c) may  request  a  hearing,  which the  Committee,  in its sole
               discretion, may grant.

14.4      Decision on Review.  The Committee shall render its decision on review
          promptly,  and not later  than  sixty  (60) days after the filing of a
          written request for review of the denial,  unless a hearing is held or
          other special circumstances require additional time, in which case the
          Committee's  decision must be rendered within one hundred twenty (120)
          days  after  such  date.  Such  decision  must be  written in a manner
          calculated to be understood by the Claimant, and it must contain:

               (a) specific reasons for the decision;

               (b) specific  reference(s)  to the pertinent Plan provisions upon
               which the decision was based; and

               (c) such other matters as the Committee deems relevant.

14.5      Legal Action. A Claimant's compliance with the foregoing provisions of
          this Article 14 is a mandatory  prerequisite to a Participant's  right
          to commence  any legal  action with  respect to any claim for benefits
          under this Plan.


                                   ARTICLE 15
                                  Miscellaneous

15.1      Unsecured General Creditor. Amounts payable to a Participant or his or
          her Beneficiary  under this Plan shall be paid from the general assets
          of  an  Employer.   Participants  and  their   Beneficiaries,   heirs,
          successors  and  assigns  shall  have no  legal or  equitable  rights,
          interest or claims in any property or assets of an  Employer.  Any and
          all of an  Employer's  assets  shall  be,  and  remain,  the  general,
          unpledged   unrestricted   assets  of  the  Employer.   An  Employer's
          obligation  under the Plan  shall be merely  that of an  unfunded  and
          unsecured  promise  to pay money in the future  and  Participants  and
          their  Beneficiaries shall be unsecured creditors of the Participant's
          Employer.

15.2      Employer's  Liability.  An  Employer's  liability  for the  payment of
          benefits shall be defined only by the Plan and the Plan Agreement,  as
          entered into between the Employer and a Participant. An Employer shall
          have no obligation to a Participant under the Plan except as expressly
          provided in the Plan.


                                       20

<PAGE>



15.3      Nonassignability.  Neither a  Participant  nor any other  person shall
          have any right to commute, sell, assign, transfer, pledge, anticipate,
          mortgage or otherwise  encumber,  transfer,  hypothecate  or convey in
          advance of actual receipt, the amounts, if any, payable hereunder,  or
          any part  thereof,  which are,  and all rights to which are  expressly
          declared  to be  unassignable  and  non-transferable,  except that the
          foregoing shall not apply to any family support  obligations set forth
          in a court  order.  No part of the  amounts  payable  shall,  prior to
          actual payment, be subject to seizure or sequestration for the payment
          of any debts,  judgments,  alimony or separate  maintenance  owed by a
          Participant or any other person,  nor be  transferable by operation of
          law in the event of a Participant's  or any other person's  bankruptcy
          or insolvency.

15.4      Not a Contract of  Employment.  The terms and  conditions of this Plan
          shall not be deemed to constitute a contract of employment between any
          Employer and the Participant.  Such employment is hereby  acknowledged
          to be an "at will" employment  relationship  that can be terminated at
          any time for any  reason,  with or  without  cause,  unless  expressly
          provided in a written employment agreement. Nothing in this Plan shall
          be  deemed  to give a  Participant  the  right to be  retained  in the
          service  of  any  Employer  or to be  retained  as a  Director,  or to
          interfere  with the right of any Employer to  discipline  or discharge
          the Participant at any time.

15.5      Furnishing   Information.   A  Participant  will  cooperate  with  the
          Committee  by  furnishing  any and all  information  requested  by the
          Committee  and take such other actions as may be requested in order to
          facilitate the administration of the Plan and the payments of benefits
          hereunder,   including   but  not  limited  to  taking  such  physical
          examinations as the Committee may deem necessary.

15.6      Terms.  Whenever  any words are used herein in the  singular or in the
          plural, they shall be construed as though they were used in the plural
          or the singular,  as the case may be, in all cases where they would so
          apply.

15.7      Captions.  The captions of the  articles,  sections and  paragraphs of
          this Plan are for convenience only and shall not control or affect the
          meaning or construction of any of its provisions.

15.8      Governing  Law. The  provisions  of this Plan shall be  construed  and
          interpreted according to the laws of the State of Arizona.

15.9      Validity.  In case any  provision  of this Plan  shall be  illegal  or
          invalid for any reason, said illegality or

                                       21

<PAGE>



          invalidity shall not affect the remaining parts hereof,  but this Plan
          shall  be  construed  and  enforced  as if such  illegal  and  invalid
          provision had never been inserted herein.

15.10     Notice.  Any notice or filing required or permitted to be given to the
          Committee  under  this Plan  shall be  sufficient  if in  writing  and
          hand-delivered,  or sent  by  registered  or  certified  mail,  to the
          addresses indicated below:

                      If a  Participant's  Employer  is  Pinnacle  West  Capital
                      Corporation or one of its subsidiaries  other than Arizona
                      Public Service Company, then to:

                      Pinnacle West Capital Corporation
                      400 East Van Buren Street
                      Post Office Box 52132
                      Phoenix, Arizona 85072-2132
                      Attn:  Human Resources Administrator

                      If a  Participant's  Employer  is Arizona  Public  Service
                      Company or its subsidiaries, then to:

                      Arizona Public Service Company
                      400 North 5th Street
                      P.O. Box 53999
                      Phoenix, Arizona 85072-3999
                      Attn:  Manager of Benefit Services
                      Station 8460

           Such notice  shall be deemed  given as of the date of delivery or, if
           delivery is made by mail, as of the date shown on the postmark on the
           receipt for registration or certification.

               Any  notice  or filing  required  or  permitted  to be given to a
          Participant  under this Plan  shall be  sufficient  if in writing  and
          hand-delivered,  or sent by mail,  to the last  known  address  of the
          Participant.

15.11     Successors.  The  provisions  of this Plan shall bind and inure to the
          benefit of the  Participant's  Employer and its successors and assigns
          and  the  Participant,  the  Participant's  Beneficiaries,  and  their
          permitted successors and assigns.

15.12     Spouse's Interest.  The interest in the benefits hereunder of a spouse
          of  a  Participant  who  has   predeceased   the   Participant   shall
          automatically pass to the Participant and shall not be transferable by
          such spouse in any manner,  including but not limited to such spouse's
          will,  nor  shall  such  interest  pass  under  the laws of  intestate
          succession.

15.13     Incompetent.  If the Committee,  in its discretion,  determines that a
          benefit under this Plan is to be paid to a minor, a

                                       22

<PAGE>


          person declared  incompetent or to a person  incapable of handling the
          disposition  of that  person's  property,  the  Committee  may  direct
          payment  of such  benefit to the  guardian,  legal  representative  or
          person  having the care and  custody  of such  minor,  incompetent  or
          incapable  person.  The  Committee  may  require  proof  of  minority,
          incompetency,  incapacity or guardianship,  as it may deem appropriate
          prior to distribution  of the benefit.  Any payment of a benefit shall
          be a payment for the account of the Participant and the  Participant's
          Beneficiary,  as the case may be, and shall be a complete discharge of
          any liability under the Plan for such payment amount.

               IN WITNESS  WHEREOF  the  Company  has caused  this  amended  and
restated  Plan to be executed by its duly  authorized  officers  this 1 day of
December, 1995.

                                               PINNACLE WEST CAPITAL CORPORATION



                                               By:   Faye Widenmann
                                                  ------------------------------
                                               Its:  Vice President


ATTEST:



By:  Michael Palmeri
   -------------------------
   Its:  Assistant Treasurer
       ---------------------



328594/7816-0007

                                       23