Document:

Exhibit 10.1
                                                                 EXECUTION COPY

                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT

         This Amended and Restated Employment Agreement, originally entered into
as of August 21,  1995,  as amended by  Amendment  No. 1, dated as of August 28,
1996, and as further amended by Amendment No. 2, dated as of April 16, 1997, and
as further  amended by  Amendment  No. 3,  dated as of August 19,  1998,  and as
further  amended  by  Amendment  No. 4, dated as of March 11,  1999,  is further
amended  and  restated  as of May 10,  1999 by and  between  MidAmerican  Energy
Holdings Company  (formerly  California Energy Company  ("CalEnergy")),  an Iowa
corporation (the "Company"), and David L. Sokol (the "Executive").

                                    RECITALS

         The Company  desires to employ the  Executive as its Chairman and Chief
Executive  Officer on the terms set forth in this  Agreement,  and the Executive
desires to accept such employment.

         Accordingly, the Company and the Executive agree as follows:

                                    AGREEMENT

         Section 1.  Defined Terms. Terms used but not defined in this Agreement
will have the meanings ascribed to them in Exhibit A to this Agreement.

         Section 2.  Employment.

          (a) The Company will employ the Executive  as, and the Executive  will
act as, the Chairman and Chief  Executive  Officer of the Company upon the terms
set forth in this  Agreement,  for the Term of  Employment,  except  that in the
event the Executive  relinquishes  his position as Chief  Executive  Officer but
offers to remain  employed as  Chairman of the Board of the Company  pursuant to
Section 7(c),  the  Executive  will act solely as Chairman of the Board upon the
terms set forth in this Agreement for the Term of Employment.

          (b) The  Executive's  primary  place  of  employment  will  be  Omaha,
Nebraska.

         Section 3.  Duties.

          (a) The  Executive  (i) will  manage the  business  of the Company and
supervise and direct the other officers of the Company and its employees, agents
and representatives,  and (ii) will perform and discharge such other duties, and
will have such other  authority,  as are customary to his office.  In performing
such duties, the Executive will report directly to the Board of Directors.
<PAGE>

          (b) The Board will not reduce the title,  office,  duties or authority
of the  Executive in any material  respect and will not require the Executive to
relocate his residence from Omaha, Nebraska. During the Term of Employment,  the
Company  will use its best efforts to cause the  Executive  to be nominated  and
elected to the Company's Board of Directors.

          (c) The Executive will act,  without any  compensation  in addition to
the  compensation  payable  pursuant  to this  Agreement,  as an  officer of any
subsidiary  of the  Company,  or as a member  of the board of  directors  of any
subsidiary of the Company, if so appointed or elected.

          (d) During the Term of  Employment,  the Executive (i) will devote his
entire time, attention and energies during normal business hours to the business
of the Company, and (ii) will not, without the Consent of the Board, perform any
services  for any other Person or engage in any other  business or  professional
activity;  provided,  however, that in the event the Executive  relinquishes his
position as Chief Executive Officer but offers to remain employed as Chairman of
the Board of the Company  pursuant to Section 7(c), the foregoing  items (i) and
(ii) shall no longer apply and instead the Executive  shall provide  services to
the Company as reasonably  requested by the Chief Executive Officer or the Board
and agrees to be available  to provide such  services for up to forty (40) hours
during each month while this Agreement is in effect.

          (e) Notwithstanding subsection (d), the Executive, without the Consent
of the Board, may (i) perform the consulting  duties  contemplated in the letter
agreement  dated  October  5,  1990,  as it may be  amended,  by and  among  the
Executive,  Ogden Corporation and Ogden Projects, Inc., (ii) purchase securities
issued by, or otherwise  passively  invest his personal or family assets in, any
other  company  or  business,  and  (iii)  engage  in  governmental,  political,
educational  or  charitable  activities,  but  only  to the  extent  that  those
activities  (A) are not  inconsistent  with any  direction  of the  Board or any
duties under this  Agreement,  and (B) do not interfere with the devotion by the
Executive of his time,  attention and energies  during normal  business hours to
the business of the Company.

         Section 4.  Compensation.

<PAGE>

          (a) During the Term of Employment,  the Company will pay the Executive
a base salary at a minimum annual rate of six hundred and seventy-five  thousand
dollars ($675,000),  in substantially equal periodic payments in accordance with
the Company's practices for executive employees.  Notwithstanding the foregoing,
if the Executive relinquishes his position as Chief Executive Officer but offers
to remain  employed as Chairman of the Board of the Company  pursuant to Section
7(c),  the Company shall pay the Executive an annual salary in the amount of six
hundred and seventy-five  thousand  dollars  ($675,000) for each 12-month period
during the Term of  Employment,  payable in equal  monthly  installments  on the
first business day of the Company of each month during the Term of Employment.

          (b) The Board will review the salary payable to the Executive at least
annually  beginning  in the fourth  fiscal  quarter of 1999.  The Board,  in its
discretion,  may increase the salary of the Executive from time to time, but may
not reduce the salary of the Executive  below the amount set forth in subsection
(a) above.  The Board may issue the Executive stock options from time to time at
its discretion.

          (c) During the Term of Employment,  the Company will pay the Executive
an annual bonus, not later than ten calendar days after the end of the preceding
fiscal year of the Company in an amount determined by the Board, by reference to
the  accomplishment  by the Executive of goals  established by the Board for the
related fiscal year. The annual bonus paid to the Executive,  however,  will not
be less than the Minimum Bonus.  The Executive shall also be eligible to be paid
other bonuses for each fiscal year as determined by the Board.  The  Executive's
annual  bonus,  together  with all such other  bonuses  paid or payable  for the
fiscal  year  (including  any amounts for which  receipt is  otherwise  deferred
pursuant to a plan or  arrangement  with the Company),  is referred to herein as
"Annual Bonus Compensation."

          (d) If the  Executive  suffers a Disability  which  continues for more
than 60 calendar days,  the Company may elect to pay the Executive,  for so long
as the Disability continues,  fifty (50) percent of the salary otherwise payable
to the Executive under Section 4(a), and fifty (50) percent of the Minimum Bonus
otherwise  payable to the Executive  pursuant to Section 4(c). Any such election
shall be  subject  to and will not  affect  the  rights  of the  Company  or the
Executive under Sections 7(a)(v) and 8(b) hereof.

          (e) The Company will reimburse the Executive, subject to compliance by
the Executive  with the Company's  customary  reimbursement  practices,  for all
reasonable  and necessary  out-of-pocket  expenses  incurred by the Executive on
behalf of the company in the course of its business.
<PAGE>

          (f) The Company may reduce any payments  made to the  Executive  under
this Agreement by any required federal,  state or local government  withholdings
or  deductions  for taxes or similar  charges,  or  otherwise  pursuant  to law,
regulation or order.

          (g) Any  base  salary  payable  to the  Executive  for any  period  of
employment of less than a year during the Term of Employment  will be reduced to
reflect  the actual  number of days of  employment  during the period  except as
provided in Section 8(b).

         Section 5.  Other Benefits.

          (a) During the Term of  Employment  (including  the Term of Employment
after Executive has relinquished his position as Chief Executive  Officer),  the
Executive  and his family may  participate  in and  receive  benefits  under any
employee  benefit  plan  which the  Company  makes  generally  available  to its
employees and their families,  including any pension,  life  insurance,  medical
benefits,  dental  benefits or disability  plan, but only to the extent that the
Executive  or his family  otherwise  satisfies  the  standards  established  for
participation in the plan.

          (b) The  Executive  may take up to six weeks of  vacation  during each
full calendar year during the Term of employment,  without loss of  compensation
or other benefits under this Agreement.

         Section 5A.  Supplemental Retirement Benefits.

          (a)  Effective  as of March 12,  1999,  the closing date of the merger
between the Company and MidAmerican Energy Company, resulting in the creation of
MidAmerican  Energy Holdings  Company (the "Merger  Date"),  the Executive shall
irrevocably become a participant in the MidAmerican Energy Company  Supplemental
Retirement Plan for Designated Officers (the "SERP").

          (b) The Executive  shall  receive fully vested years of  participation
credit under the SERP (for all purposes,  including vesting and benefit accrual)
for all years of service (or portions thereof) performed at the Company prior to
the Merger Date, as provided on Exhibit B attached hereto.

          (c) The  Executive  shall be entitled to an Early  Retirement  Benefit
Payment  Option  under  the SERP  pursuant  to which  he may  elect to  commence
receiving benefits under the SERP after the Executive's retirement or disability
on or after attaining age 47, which payments shall be calculated pursuant to the

<PAGE>

SERP but which shall be no less than as provided on Exhibit C hereto  (including
for purposes of the following sentence).  In the event of the Executive's death,
benefits shall be paid pursuant to Section 6.4 of the SERP;  provided,  however,
that any payment due under  Section  6.4(a) of the SERP shall  continue  for the
remaining  lifetime of the  Executive's  surviving  "Spouse"  (as defined in the
SERP) or for 360 months if the Executive  dies without a surviving  Spouse;  and
further provided, however, that any payment due under Section 6.4(b) of the SERP
shall be payable without regard to the two-thirds and fifty percent  limitations
contained therein.

          (d) In the  event  of a  Triggering  Event  (as  defined  below),  the
Executive shall be entitled to the following under the SERP:

                           (i)   for   purposes   of   determining    years   of
                           participation credit, the Executive shall be credited
                           with additional years of  participation  (or portions
                           thereof) equal to the  difference  between age 65 and
                           the Executive's age (in years or portions thereof) on
                           the date of the Triggering Event, and

                           (ii) any benefits  under the SERP not fully vested on
                           the  date  of the  Triggering  Event  (including  the
                           benefits arising by the foregoing subparagraph) shall
                           become fully vested as of such date.

For  purposes  of this  Section  5A(d),  a  Triggering  Event shall mean (x) the
termination of the Executive by the Company  without Cause;  (y) the resignation
by the Executive pursuant to Section 7(a)(iv) of this Agreement; or (z) a Change
in Control occurring after the Merger Date. All capitalized terms shall have the
meanings ascribed to them in Exhibit A of this Agreement.

          (e)  Notwithstanding  anything  herein or in the SERP to the contrary,
for purposes of determining the benefit payable to Executive under the SERP, the
Executive's  annual  base  salary and annual  bonus shall never be less than the
base salary  referenced  in Section  4(a) hereof and that  portion of the Annual
Bonus Compensation earned by Executive for the 1998 calendar year which the SERP
Committee has determined  shall be included for purposes of calculating the SERP
benefit (i.e., $1,850,000).

          (f) Within 30 days prior to a Change in Control, the Company shall (i)
establish a rabbi trust or an  irrevocable  standby letter of credit with a U.S.
Bank rated A or better, in each case naming the Executive as the beneficiary and
<PAGE>
having terms reasonably  satisfactory to Executive, in order to provide security
for the  payment of benefits to  Executive  pursuant to the SERP,  and (ii) if a
rabbi trust is established,  deposit into the rabbi trust an amount which,  with
the  expected   earnings  thereon  from  reasonably   prudent  and  conservative
investments  (as confirmed by a  certificate  of a national  accounting  firm of
recognized  standing which is independent of the Company) shall be sufficient to
satisfy the ultimate benefit obligations to Executive pursuant to the SERP.

          (g) A general  release of claims  under the SERP shall not be required
of the Executive in order to receive benefits thereunder.

          (h) The  Executive's  entitlement  to benefits under the SERP shall be
nonforfeitable  and,  Section  6.5 of the  SERP  notwithstanding,  shall  not be
adversely affected in any way upon termination of the Executive's employment for
Cause.

         Section 6.  Confidentiality and Post-Employment Restrictions.

          (a) The  Executive  acknowledges  that the  Company  has  confidential
information  and trade secrets,  whether  written or unwritten,  with respect to
carrying  on  its  business,  including  sensitive  technology  and  engineering
information  and data,  names, of past,  present and  prospective  customers and
vendors of the  Company,  methods of pricing  contracts  and income and expenses
associated therewith, negotiated prices and offers outstanding, credit terms and
status of accounts and the terms or circumstances  of any business  arrangements
between the Company and any third parties  ("Confidential  Information and Trade
Secrets").  As used in this  Agreement,  the term  Confidential  Information and
Trade Secrets does not include (i) information which becomes generally available
to the public  other than as a result of a  disclosure  by the  Executive,  (ii)
information which becomes available to the Executive on a nonconfidential  basis
from a  source  other  than  the  Company,  or  (iii)  information  known to the
Executive prior to any disclosure to him by the Company.  The Executive  further
acknowledges  that the  Executive  possesses a high degree of  knowledge  of the
geothermal energy industry and, in particular,  has committed to a long-standing
relationship  with the Company as  employee,  director  and  officer,  which has
allowed,  and will continue to allow,  him access to the Company's  Confidential
Information and Trade Secrets. Accordingly, any employment by the Executive with
another employer in the geothermal  energy industry or participation by him as a
substantial  investor in any such industry may necessarily involve disclosure of
the Company's  Confidential  Information  and Trade Secrets.  Consequently,  the
<PAGE>
Executive agrees that, if he voluntarily resigns his employment with the Company
for any reason other than a breach of this  Agreement  by the Company,  he shall
not at any time during the two-year period after such  resignation,  directly or
indirectly  accept employment by or invest in (except as a passive investor in a
public corporation or in a publicly issued partnership interest which, in either
event, would not exceed an ownership interest of 3% of the outstanding equity or
partnership  interest)  in any person,  firm,  corporation,  partnership,  joint
venture or business which is primarily engaged in the production or marketing of
electrical   energy  from   geothermal   resources.   The   preceding   sentence
notwithstanding, if the Executive's resignation occurs upon or after a Change in
Control,  he shall not be  precluded  from  accepting  employment  or  providing
services to Peter Kiewit Sons', Inc. or any Affiliate thereof.

          (b) Without the Consent of the Board,  the Executive will not, for two
years after the Term of Employment,  (i) disclose any  Confidential  Information
and Trade  Secrets of the Company or any  Affiliate of the Company to any Person
(other than the  Company,  directors,  officers or  employees  of the Company or
representatives  thereof),  or  (ii)  otherwise  make  use of  any  Confidential
Information and Trade Secrets other than in connection with authorized  dealings
with or by the Company.

          (c) For a  period  of two  years  after  the Term of  Employment,  the
Executive shall neither  directly nor indirectly  solicit,  on behalf of another
employer,  the  employment of any person who is then  currently  employed by the
Company,  or otherwise  induce,  on behalf of another  employer,  such person to
leave  the  employment  of the  Company  without  the  Company's  prior  written
approval.

          (d) The  Executive  will  hold on  behalf  of the  Company  and as the
property  of the  Company,  all  memoranda,  manuals,  books,  papers,  letters,
documents,  computer  software and other similar  property  obtained  during the
course of his employment by the Company and relating to the Company's  business,
and will  return  such  property  to the  Company at any time upon demand by the
Board and, in any event,  within five calendar days after the end of the Term of
Employment.

         Section 7.  Termination of Employment or Change in Employment Status.

          (a)  The  employment  of  the  Executive  under  this  Agreement  will
terminate  on the  earliest  of:  (i)  written  notice by the  Executive  of his
resignation; (ii) the 30th calendar day after the Company gives to the Executive
written notice of termination  without Cause; (iii) the fifth calendar day after

<PAGE>

the Company  gives to the  Executive  written  notice of the existence of Cause;
(iv) the 30th  calendar  day after the  Executive  gives to the Company  written
notice of (A) the failure by the Company to pay to the Executive, for a material
period of time and in a material  amount,  compensation  due and  payable by the
Company  under  Section  4(a) or 4(c),  or (B) any breach by the  Company or the
Board of Section  3(b) or Section  4(b);  (v) the  Permanent  Disability  of the
Executive; or (vi) the death of the Executive.

          (b) If the  Employment  of the  Executive  is  terminated  under  this
Agreement,  the obligations of the Executive under Section 6 will remain in full
force and effect,  and the termination  will not abrogate any rights or remedies
of the Company or the  Executive  with  respect to any breach of the  Agreement,
except as expressly provided in Sections 8 and 9.

          (c) If the  Executive  relinquishes  his  position as Chief  Executive
Officer but offers to remain  employed as Chairman of the Board of the  Company,
this Agreement  will remain in full force and effect,  subject to the provisions
hereof governing his employment  solely as Chairman of the Board. In such event,
the first  sentence of Section  3(a) and  Sections  3(c),  (e) and 4(d) shall no
longer be applicable.

         Section 8.  Payment Upon Termination.

          (a) If the  employment  of the  Executive  is  terminated  pursuant to
subsections (i) or (iii) of Section 7(a), the Company will pay to the Executive,
within 30  calendar  days,  (x) any salary  pursuant  to  Section  4(a) which is
accrued but unpaid through the Termination Date, and (y) a bonus payment,  in an
amount  determined by the Board by reference to the performance of the Executive
for a portion of the fiscal year of the  Company  before the  Termination  Date,
which is not less than the Minimum Bonus.

          (b) If the  employment  of the  Executive  is  terminated  pursuant to
subsections  (ii),  (iv),  (v) or (vi) of Section 7(a), the Company will pay the
Executive,  on or before the related  Termination Date, an amount equal to three
times the sum of (1) the annual salary then in effect pursuant to Section 4, and
(2) the greater of (x) the Minimum  Bonus or (y) an amount  equal to the average
Annual Bonus Compensation  payable to the Executive in respect of the two fiscal
years immediately preceding the fiscal year in which the Executive's  employment
with the Company terminates. In addition, (x) any portion of the options granted

<PAGE>

to the Executive which would become vested within the next 36 months  (beginning
with the month  following the month in which the  Termination  Date occurs) will
vest  immediately and may be exercised  within the remaining term of the options
as provided  in the  applicable  option  agreements,  and (y) the Company  shall
continue in effect for Executive and his  dependents,  for a period of 36 months
after the Termination  Date, the life insurance  benefits,  medical benefits and
dental  benefits,  the  disability  plan,  the tax  preparation  and  investment
advisory  services and any other employee  benefits made generally  available to
senior executives of the Company on and after the date hereof through the end of
the 36 month post-termination period, subject to such employee contributions and
other terms and conditions as are applicable to active  employees  generally and
subject to subsequent  modification  or  termination of such plans to the extent
such  subsequent  actions are also  applicable  to active  employees  generally;
provided that such plan benefits  shall  terminate  earlier on the date, if any,
that comparable benefits are made available to the Executive by any new employer
(the  "Continuation of Benefits").  To the degree that any of the above employee
benefit  programs  are not  available to Executive on account of his status as a
non-employee  after  termination  of  employment,  the Company shall provide for
economically  equivalent programs during the 36 month period or pay to executive
a lump sum cash amount designed to allow him to obtain  economically  equivalent
benefits  or put him in the same  economic  position  on an after tax basis (the
"Economic Equivalent").

          If the Executive  relinquishes his position as Chief Executive Officer
but offers to remain  employed as Chairman of the Board of the Company  pursuant
to  Section  7(c) and the  Executive's  employment  is  subsequently  terminated
pursuant to subsection  (ii),  (iv), (v) or (vi) of Section 7(a), in lieu of the
payments  described  above,  the Company shall (i) pay the Executive any due and
payable salary pursuant to Section 4(a) for his services rendered to the Company
prior to the termination of this Agreement,  (ii) reimburse  pursuant to Section
4(e) the expenses  incurred by the Executive  prior to the  termination  of this
Agreement,  (iii) pay the  Executive  the full  amount of the  aggregate  annual
salary  that would have been paid  pursuant  to Section  4(a)  through the fifth
anniversary  of the date he commenced his  employment  solely as Chairman of the
Board, (iv) provide for the immediate vesting and  exercisability of all options
awarded to the Executive by the Company and (iv) provide for the Continuation of
Benefits  through the fifth  anniversary of the date he commenced his employment
solely as Chairman of the Board or the Economic Equivalent thereof.

          (c) If the  employment  of the  Executive  is  terminated  pursuant to
subsections (ii), (iv), (v) or (vi) of Section 7(a), all Performance Accelerated
Stock  Options  ("PASOs")  held by the  Executive on the  Termination  Date will
become vested and immediately  exercisable on such  Termination  Date, and shall
otherwise  remain  exercisable  for  their  term in  accordance  with the  terms
thereof.
<PAGE>

          (d) If the  employment  of the  Executive  is  terminated  pursuant to
subsections  (ii),  (iv),  (v) or (vi) of  Section  7(a) at any time  prior to a
Change in Control  or for any reason  after a Change in  Control,  then  without
further action by the Company, the Board or any committee thereof, the Executive
may exercise  any vested  stock  options  (including  vested  PASOs) held by the
Executive pursuant to existing procedures approved by the Stock Option Committee
for cashless exercise, by surrendering previously owned shares, electing to have
the Company withhold shares otherwise deliverable upon exercise of such options,
or by providing an irrevocable  direction to a broker to sell shares and deliver
all or a portion of the proceeds to the Company,  in any case in an amount equal
to the aggregate exercise price and any tax withholding  obligation attendant to
the exercise.

          (e) If the  Executive  relinquishes  his  position as Chief  Executive
Officer  but  offers  to remain  employed  as the  Chairman  of the Board of the
Company  pursuant to Section  7(c),  the Company will pay the  Executive,  on or
before the date he relinquishes such position, a special achievement bonus which
is equal to two times the sum of (1) the annual  salary then in effect  pursuant
to Section  4, and (2) the  greater  of (x) the  Minimum  Bonus or (y) an amount
equal to the average  Annual  Bonus  Compensation  payable to the  Executive  in
respect of the two fiscal years  immediately  preceding the fiscal year in which
the Executive  relinquishes  such position.  In addition to the  foregoing,  all
options  awarded by the Company to the  Executive  that would become  vested and
exercisable  during  the two  year  period  following  the  date  the  Executive
relinquishes  his  position as Chief  Executive  Officer but offers to remain as
Chairman of the Board pursuant to Section 7(c) (the "Relinquishment Date") shall
become immediately vested and exercisable as of the Relinquishment Date, and all
remaining  options that would commence  vesting in the period of time subsequent
to such two-year period shall commence vesting in accordance with their terms as
of the Relinquishment Date.

                  Section 8A.  Certain Additional Payments by the Company.

          (a) Anything in this Agreement to the contrary notwithstanding, in the
event it shall be determined that any payment,  distribution,  waiver of Company
rights, acceleration of vesting of any stock options or restricted stock, or any
other payment or benefit in the nature of  compensation to or for the benefit of
the  Executive,  alone or in  combination  (whether such payment,  distribution,
waiver,  acceleration  or other  benefit is made  pursuant  to the terms of this
<PAGE>
Agreement or any other  agreement,  plan or  arrangement  providing  payments or
benefits in the nature of  compensation  to or for the benefit of the Executive,
but determined  without regard to any  additional  payments  required under this
Section 8A) (a "Payment")  would be subject to the excise tax imposed by Section
4999 of the  Internal  Revenue  Code  of 1986  (the  "Code")  (or any  successor
provision)  or any interest or  penalties  are  incurred by the  Executive  with
respect to such excise tax (such excise tax, together with any such interest and
penalties,  are hereinafter  collectively referred to as the "Excise Tax"), then
the Executive  shall be entitled to receive an  additional  payment (a "Gross-Up
Payment")  in an amount such that after  payment by the  Executive  of all taxes
with  respect to the  Gross-Up  Payment  (including  any  interest or  penalties
imposed with respect to such taxes), including,  without limitation,  any income
taxes (and any interest and penalties  imposed with respect  thereto) and Excise
Tax imposed upon the Gross-Up  Payment,  the Executive  retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.

          (b) Subject to the  provisions of Section  8A(c),  all  determinations
required to be made under this Section 8A, including whether and when a Gross-Up
Payment is required and the amount of such Gross-Up  Payment and the assumptions
to be utilized in arriving at such determination,  shall be made by Deloitte and
Touche LLP, or such other  nationally  recognized  accounting firm then auditing
the accounts of the Company (the "Accounting Firm") which shall provide detailed
supporting calculations both to the Company and the Executive within 15 business
days of the receipt of notice from the Executive  that there has been a Payment,
or such  earlier  time as is  requested  by the  Company.  In the event that the
Accounting  Firm is unwilling or unable to perform its  obligations  pursuant to
this Section 8A, the  Executive  shall  appoint  another  nationally  recognized
accounting firm to make the determinations  required hereunder (which accounting
firm shall then be referred to hereunder as the Accounting  Firm).  All fees and
expenses  of the  Accounting  Firm  shall be borne  solely by the  Company.  Any
Gross-Up Payment,  determined  pursuant to this Section 8A, shall be paid by the
Company to the  Executive  within  five days of the  receipt  of the  Accounting
Firm's determination.  Any determination by the Accounting Firm shall be binding
upon the Company and the Executive.  The parties hereto  acknowledge  that, as a
result of the potential  uncertainty  in the  application of Section 4999 of the
Code (or any successor  provision) at the time of the initial  determination  by
the  Accounting  Firm  hereunder,  it is possible that the Company will not have
made  Gross-Up  Payments  which  should  have  been  made  consistent  with  the
calculations  required to be made  hereunder (an  "Underpayment").  In the event

<PAGE>

that the  Company  exhausts  its  remedies  pursuant  to  Section  8A(c) and the
Executive  thereafter  is  required  to make a payment  of any Excise  Tax,  the
Accounting Firm shall determine the amount of the Underpayment that has occurred
and any such  Underpayment  shall be promptly  paid by the Company to or for the
benefit of the Executive.

          (c) The Executive  shall notify the Company in writing of any claim by
the Internal  Revenue Service that, if successful,  would require the payment by
the Company of the Gross-Up Payment. Such notification shall be given as soon as
practicable  but no later than 20 business  days after the Executive is informed
in  writing of such claim and shall  apprise  the  Company of the nature of such
claim and the date on which such claim is  requested to be paid.  The  Executive
shall not pay such claim prior to the expiration of the 30-day period  following
the date on which he gives such notice to the Company  (or such  shorter  period
ending on the date that any payment of taxes with respect to such claim is due).
If the Company notifies the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive shall:

          (i)       give the Company any information reasonably requested by the
                    Company relating to such claim,

          (ii)      take such action in connection with contesting such claim as
                    the Company shall reasonably request in writing from time to
                    time,   including,   without  limitation,   accepting  legal
                    representation  with  respect to such  claim by an  attorney
                    reasonably selected by the Company,

          (iii)     cooperate   with  the   Company   in  good  faith  in  order
                    effectively to contest such claim, and

          (iv)      permit  the  Company  to  participate  in  any   proceedings
                    relating to such claim;

         provided,  however,  that the Company  shall bear and pay  directly all
         costs  and  expenses  (including  additional  interest  and  penalties)
         incurred in connection  with such contest and shall  indemnify and hold
         the Executive  harmless,  on an after-tax  basis, for any Excise Tax or
         income tax  (including  interest and  penalties  with respect  thereto)
         imposed  as a result of such  representation  and  payment of costs and
         expenses.  Without  limiting the  foregoing  provisions of this Section
         8A(c),  the Company shall control all  proceedings  taken in connection
         with such contest and, at its sole option,  may pursue or forgo any and
         all administrative appeals, proceedings,  hearings and conferences with
         the taxing  authority  in  respect  of such claim and may,  at its sole
         option,  either direct the Executive to pay the tax claimed and sue for
         a refund  or  contest  the  claim in any  permissible  manner,  and the

<PAGE>

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

          (d) If, after the receipt by the  Executive  of an amount  advanced by
the Company pursuant to Section 8A(c), the Executive becomes entitled to receive
any refund  with  respect to such claim,  the  Executive  shall  (subject to the
Company's  complying with the requirements of Section 8A(c)) promptly pay to the
Company the amount of such refund  (together  with any interest paid or credited
thereon after taxes applicable thereto).  If, after the receipt by the Executive
of an amount advanced by the Company  pursuant to Section 8A(c), a determination
is made that the  Executive  shall not be entitled to any refund with respect to
such  claim and the  Company  does not notify  the  Executive  in writing of its
intent to contest such denial of refund prior to the expiration of 30 days after
such  determination,  then  such  advance  shall be  forgiven  and  shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.

         Section 9.  Remedies.

          (a) The Company will be entitled,  if it elects,  to enjoin any breach
or threatened breach of, or enforce the specific performance of, the obligations
of the  Executive  under  Sections 3 or 6, without  showing any actual damage or
that monetary damages would be inadequate. Any such equitable remedy will not be
the sole and  exclusive  remedy for any such breach,  and the Company may pursue
other remedies for such a breach.
<PAGE>

          (b) Any court proceeding to enforce this Agreement may be commenced in
federal  courts,  or in the absence of federal  jurisdiction  the state  courts,
located in Omaha,  Nebraska.  The  parties  submit to the  jurisdiction  of such
courts  and waive any  objection  which  they  might have to pursuit of any such
proceeding of any such court.

          (c) Except to the extent  that the Company  elects to seek  injunctive
relief in accordance  with  subsection (a), any controversy or claim arising out
of or relating to this Agreement or the validity, interpretation, enforceability
or breach of this Agreement will be submitted to arbitration in Omaha, Nebraska,
in  accordance  with  the  then  existing  rules  of  the  American  Arbitration
Association, and judgment upon the award rendered in any such arbitration may be
entered in any court having jurisdiction.

          (d) The Company will pay,  promptly  upon  request,  any legal fees or
expenses  incurred by the  Executive in  connection  with any legal  proceedings
instituted by the company to enforce the  provisions of this  Agreement  against
the Executive,  but such advances will be reimbursable to the Company,  but only
to the extent the  Company  ultimately  prevails  in the  proceeding  (after any
applicable appeals have been exhausted).

         Section 10.  Assignment.  Neither the Company nor the Executive may
sell, transfer or otherwise assign their rights, or delegate their obligations,
under this Agreement.

         Section 11.  Unfunded  Benefits.  All  compensation  and other benefits
payable to the Executive under this Agreement will be unfunded,  and neither the
company nor any  affiliate of the Company will  segregate  any assets to satisfy
any  obligation  of the Company under this  Agreement.  The  obligations  of the
Company to the Executive are not the subject of any guarantee or other assurance
of any Person other than the Company.

         Section 12. Severability.  Should any provision,  paragraph,  clause or
portion  thereof of this  Agreement be declared or be determined by any court or
arbitrator of competent  jurisdiction to be illegal,  unenforceable  or invalid,
the validity or enforceability of the remaining parts, terms or provisions shall
not be affected  thereby and said  illegal or invalid  part,  term or  provision
shall be deemed not to be a part of this Agreement.  Alternatively, the court or
arbitrator  having  jurisdiction  shall have the power to modify  such  illegal,
unenforceable  or invalid  provision  so that it will be valid and  enforceable,
and, in any case,  the remaining  provisions of this  Agreement  shall remain in
full force and effect.
<PAGE>

         Section 13.  Miscellaneous.

          (a) This  Agreement  may be  amended  or  modified  only by a  writing
executive by the Executive and the Company.

          (b) This  Agreement  will be governed by and  construed in  accordance
with the internal laws of the State of Nebraska.

          (c) This Agreement constitutes the entire agreement of the Company and
the  Executive  with  respect to the  matters  set forth in this  Agreement  and
supersedes  any and all other  agreements  between the Company and the Executive
relating to those matters.

          (d) Any notice required to be given pursuant to this Agreement will be
deemed  given (i) when  delivered in person,  or (ii) on the third  calendar day
after it is sent by  facsimile,  express  delivery  service,  or  registered  or
certified mail, if to the Company or to the Executive, at 302 South 36th Street,
Suite 400,  Omaha,  Nebraska  68131,  fax number (402) 231-1658 or to such other
address as may be  subsequently  designated  by the Company or the  Executive in
writing to the other party.

          (e) A  waiver  by a party  of a  breach  of this  Agreement  will  not
constitute a waiver of any other breach, prior or subsequent, of this Agreement.

         IN WITNESS  WHEREOF,  the Company and the  Executive  have entered into
this Agreement as of May 10, 1999.

                                   MIDAMERICAN ENERGY HOLDINGS COMPANY

                                   BY:_____________________________
                                      Steven A. McArthur
                                      Senior Vice President

                                   EXECUTIVE:

                                   BY:_____________________________
                                      David L. Sokol

<PAGE>

                                    EXHIBIT A

                                  Defined Terms

         "Affiliate means, with respect to a Person,  (a) any Person directly or
indirectly  owning,  controlling,  or  holding  power to vote 10% or more of the
outstanding voting securities of the Person; (b) any Person 10% or more of whose
outstanding  voting securities are directly or indirectly  owned,  controlled or
held with power to vote by the Person;  (c) any Person  directly  or  indirectly
controlling,  controlled by or under common control with, the Person and (d) any
officer or  director  of the Person,  or of any Person  directly  or  indirectly
controlling  the Person,  controlled by the Person or under common  control with
the Person. As used in this definition, "control" means the possession, directly
or  indirectly,  of the power to direct or cause the direction of the management
and policies of a Person.

         "Agreement"  means  this  Employment  Agreement  dated as of August 21,
1995,  by and between the Company and the  Executive,  as it may be amended from
time to time in accordance with its terms.

         "Board"  means the Board of Directors of the Company or, if the context
is  appropriate,  any duly  authorized and appointed  committee or member of the
Board of Directors  having  authority to act on behalf of the Board of Directors
with respect to the matter in question.

         "Cause means any or all of the following:

         (a)      the willful and continued  failure by the Executive to perform
                  substantially  the  services  contemplated  by  the  Agreement
                  (other than any such failure  resulting  from the  Executive's
                  incapacity  due to  disability)  after a  written  demand  for
                  substantial  performance  is delivered  to the  Executive by a
                  member  or  representative  of the  Board  which  specifically
                  identifies  the  manner  in  which  it  is  alleged  that  the
                  Executive has not substantially performed such services;

         (b)      the willful  engaging  by the  Executive  in gross  misconduct
                  which is materially and demonstrably injurious to the Company,
                  provided  that, no act, or failure to act, on the  Executive's
                  part shall be considered  "willful" unless done, or omitted to
                  be done, in bad faith and without  reasonable belief that such
                  action  or  omission  was in,  or not  opposed  to,  the  best
                  interests of the Company; or
<PAGE>

          (c)     the gross  negligence  of the  Executive in  performing  the
                  services  contemplated  by the Agreement which is materially
                  and demonstrably injurious to the Company.

         "Cause" will exist only if the Board has  delivered to the  Executive a
copy of a resolution duly adopted by the  affirmative  vote of a majority of the
entire  membership  of the Board at a meeting  of the Board  called and held for
that purpose (after  reasonable  notice to the Executive and an opportunity  for
the Executive, together with his counsel, to be heard before the Board), finding
that, in the good faith  judgment of the Board,  the Executive was guilty of the
conduct  constituting  such Cause and  specifying,  the  particulars  thereof in
detail.

         "Change in Control" means (i) approval by the Company's stockholders of
(A) the dissolution of the Company, (B) a merger or consolidation of the Company
where the Company is not the surviving corporation, except for a transaction the
principal  purpose  of which is to  change  the state in which  the  Company  is
incorporated,  (C) a reverse  merger in which the Company  survives as an entity
but in which  securities  possessing  more than 50 percent of the total combined
voting power of the Company's  securities are transferred to a person or persons
different from those who hold such securities immediately prior to the merger or
(D) the sale or other  disposition of all or substantially  all of the Company's
assets;  (ii) the direct or indirect  acquisition by any Person or related group
of  Persons  (other  than  an  acquisition  from  or  by  the  Company  or  by a
Company-sponsored  employee  benefit  plan  or  by a  Person  that  directly  or
indirectly  controls,  is controlled  by, or is under common  control with,  the
Company)  of  beneficial  ownership  (within  the  meaning  of Rule 13d-3 of the
Securities Exchange Act of 1934, as amended) of securities  possessing more than
50 percent  of the total  combined  voting  power of the  Company's  outstanding
voting  securities;  or (iii) a change in the  composition  of the Board  over a
period of  thirty-six  (36)  months or less  such that a  majority  of the Board
members cease, by reason of one or more contested elections for Board membership
or by one or more actions by written consent of stockholders, to be comprised of
individuals  who  either  (A) have been  Board  members  continuously  since the
beginning of such period or (B) have been  elected or nominated  for election as
Board  members  during such  period by at least a majority of the Board  members
described  in clause (A) who were still in office at the time such  election  or
nomination was approved by the Board.

         "Company"  means   MidAmerican   Energy  Holdings   Company,   an  Iowa
corporation, and any successor or assign permitted under the Agreement.
<PAGE>

         "Consent of the Board" means, with respect to an action, the consent of
the Board to the action given prior to the action in a  resolution  duly adopted
by the Board,  appropriate  committee of the Board,  or by a member of the Board
duly authorized to consent to such action.

         "Disability"  means, with respect to the Executive,  that the Executive
has become  physically  or mentally  incapacitated  or disabled so that,  in the
reasonable  judgment of  majority  of the members of the Board,  he is unable to
perform his duties under this  Agreement and such other services as he performed
on behalf of the Company before incurring such incapacity or disability.

         "Minimum  Bonus"  means,  with  respect  to a  fiscal  year,  $675,000;
provided, however, in the event the Executive relinquishes his position as Chief
Executive  Officer but offers to remain employed as Chairman of the Board of the
Company  pursuant to Section 7(c) of this  Agreement,  there shall be no Minimum
Bonus,  but the  Board  shall  retain  its  discretion  to  award  Annual  Bonus
Compensation pursuant to Section 4(c) of the Agreement.

         "Permanent  Disability"  means a Disability  which has continued for at
least six consecutive calendar months.

         "Person"  means  any  natural  person,  general  partnership,   limited
partnership, corporation, joint venture, trust, business trust, or other entity.

         "Term of  Employment"  means the period of time beginning on August 21,
1995,  and  ending  on the  fifth  anniversary  of  such  date,  unless  earlier
terminated  pursuant to Section 7(a) or automatically  extended  pursuant to the
following  sentence.  The Term of Employment will be automatically  extended for
one year on each  anniversary  of the date of this  Agreement  beginning  on the
fifth anniversary  unless the Executive has given the Company a notice declining
automatic extension at least 120 calendar days before the anniversary; provided,
however, in the event the Executive relinquishes his position as Chief Executive
Officer  but offers to remain  employed  as Chairman of the Board of the Company
pursuant to Section 7(c) of this  Agreement,  the Term of Employment  shall mean
the period of time beginning on the date the Executive relinquishes his position
as Chief Executive Officer of the Company and ending on the fifth anniversary of
such date, unless earlier terminated pursuant to Section 7(a).

         "Termination  Date" means the date of  termination of employment of the
Executive pursuant to Section 7 of this Agreement.

<PAGE>

                                    EXHIBIT B

David L. Sokol

Credited Years of Service as of March 12, 1999: 6 years, 9 months

<PAGE>

                                    EXHIBIT C

David L. Sokol

Minimum Annual SERP benefit  payment for retirement or disability  payable on or
after attaining age 47: $853,887.Exhibit 10.2

                                 AMENDMENT NO. 1

                                     TO THE

                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT

                                     BETWEEN

                       MIDAMERICAN ENERGY HOLDINGS COMPANY

                                       AND

                                 DAVID L. SOKOL

                  This  Amendment  No. 1 (the  "Amendment")  to the  Amended and
Restated  Employment  Agreement  dated  as of  May  10,  1999  (the  "Employment
Agreement")  by  and  between  MidAmerican  Energy  Holdings  Company,  an  Iowa
corporation (the "Company"),  and David L. Sokol (the  "Executive"),  is entered
into as of March __, 2000.

                  WHEREAS,  the Company and the Executive are presently parties
to the Employment Agreement; and

                  WHEREAS,   in  consideration  of  the  performance  of  future
services by the  Executive,  the Company and the  Executive  desire to amend the
Employment  Agreement to increase the  Executive's  salary,  and grant Executive
additional options;

                  NOW, THEREFORE,  the Employment Agreement is hereby amended as
follows:

                  By inserting  immediately following Section 2(b) a new Section
2(c) to read as follows:

                  "(c) For so long as the Executive continues to serve as either
                  Chairman or Chief Executive  Officer of the Company,  he shall
                  have the right (i) to serve as a member of the Board, and (ii)
                  to designate two other individuals as nominees for election to
                  the Board."

                  By deleting  the phrase  "six  hundred  seventy-five  thousand
         ($675,000)"  each time it appears in Section 4(a) and replacing it with
         "seven hundred fifty thousand ($750,000)".

                  By inserting  immediately following Section 5(b) a new Section
5(c) to read as follows:

                  "(c)  Effective  as of the  Closing  Date (as  defined  in the
                  Agreement  and Plan of Merger by and among the Company,  Teton
<PAGE>

                  Formation  L.L.C.  and Teton  Acquisition  Corp.  (the "Merger
                  Agreement")) and conditioned on the occurrence of the Closing,
                  the Executive  shall be granted under the Company's 1996 Stock
                  Option Plan (or any successor plan thereto),  new options (the
                  "New  Options") for a number of shares of Company common stock
                  equal to 30% of the sum of (i) the number of shares of Company
                  common stock owned beneficially by Executive as of October 23,
                  1999  (provided  that all such  shares  are  rolled  over into
                  common  stock of the  Surviving  Corporation  (as such term is
                  defined  in  the  Merger   Agreement)),   plus  (ii)   without
                  duplication,  the  number of  shares  subject  to  outstanding
                  Company  common stock  options held by Executive as of October
                  23, 1999  (provided that all such options are rolled over into
                  equivalent options in respect of Surviving  Corporation common
                  stock). The exercise price applicable to the New Options shall
                  be $35.05  per  share.  The New  Options  shall  vest in equal
                  installments  of one  thirty-sixth  (1/36th)  of the number of
                  shares subject to the grant on each of the monthly anniversary
                  dates of the Closing Date,  shall have an exercise term of ten
                  (10) years  from the  Closing  Date,  and shall  otherwise  be
                  subject  to   customary   terms  and   conditions,   including
                  anti-dilution protections."

                  By inserting  immediately following Section 5(c) a new Section
5(d) to read as follows:

                  "(d) The  Executive  acknowledges  that the  grant of  Company
                  options to Executive  in exchange  for his  surrender to Teton
                  Acquisition  Corp.  of Company  stock options and his right to
                  continue to exercise such options is in  consideration  of his
                  performance of future services."

                  Except as provided herein and to the extent  necessary to give
full effect to the  provisions of this  Amendment,  the terms of the  Employment
Agreement shall remain in full force and effect.

<PAGE>

                  IN WITNESS WHEREOF,  the parties hereto have entered into this
Amendment effective as of the above date.

                                           MIDAMERICAN ENERGY HOLDINGS COMPANY

                                           By:    ____________________________
                                                 Name:
                                                 Title:

                                           EXECUTIVE

                                                  -----------------------------
                                                  David L. Sokol

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