Document:

<PAGE>

                                                                   Exhibit 10(D)

                         CHANGE IN CONTROL AGREEMENT
                         ---------------------------

         THIS AGREEMENT, dated May 21, 2001, is made by and between Sierra
Pacific Resources, a Nevada corporation (the "Company"), and John E. Brown
(the "Executive").

         WHEREAS, the Company considers it essential to the best interests of
its stockholders to foster the continued employment of key management
personnel; and

         WHEREAS, the Board recognizes that, as is the case with many publicly
held corporations, the possibility of a Change in Control exists and that such
possibility, and the uncertainty and questions which it may raise among
management, may result in the departure or distraction of management personnel
to the detriment of the Company and its stockholders; and

         WHEREAS, the Board has determined that appropriate steps should be
taken to reinforce and encourage the continued attention and dedication of
members of the management of the Company and its subsidiaries (collectively,
"Sierra"), including the Executive, to their assigned duties without
distraction in the face of potentially dasturbing circumstances arising from
the possibility of a Change in Control;

         NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the Company and the Executive hereby agree as
follows:

         1. Defined Terms.  The definitions of capitalized terms used in this
            -------------
Agreement are provided in the last Section hereof.

         2. Term of Agreement. The term of this Agreement shall commence on
            -----------------
the date hereof and shall continue in effect through December 31, 2004;
provided, however, that if a Change in Control shall have occurred during the
--------  -------
Term, the Term shall expire no earlier than twenty-four (24) months beyond the
month in which such Change in Control occurred; and further provided, however,
                                                    ------- --------  -------
that if a Potential Change in Control shall have occurred during the Term, the
Term shall expire no earlier than the later of (a) December 31, 2004, (b) the
date on which such potential Change in Control shall have been terminated, or
(c) 24 months beyond the

                                      1

<PAGE>

date on which such potential Change in Control shall have resulted in a Change
of Control.

         3.  Company's Covenants Summarized.  In order to induce the Executive
             ------------------------------
to remain if the employ of Sierra and in consideration of the Executive's
covenants set forth in Section 4 hereof, the Company agrees, under the
conditions described herein, to pay the Executive the Severance Payments and
the other payments and benefits described herein. Except as provided in Section
9.1 hereof, no Severance Payments shall be payable under this Agreement unless
there shall have been (or, under the terms of the second sentence of Section
6.1 hereof, there shall be deemed to have been) a termination of the
Executive's employment with Sierra following a Change in Control or potential
Change in Control and during the Term. This Agreement shall not be construed as
creating an express or implied contract of employment and, except as otherwise
agreed in writing between the Executive and Sierra, the Executive shall not
have any right to be retained in the employ of Sierra. The obligations of the
Company hereunder shall be deemed satisfied to the extent payments are made by
Sierra Pacific Power, Nevada Power, or any affiliate of the Company or any
successor to the Company or any sucessor to any affiliate of the Company.

         4. The Executive's Covenants.  The Executive agrees that, subject to
            -------------------------
the terms and conditions of this Agreement, in the event of a Potential Change
in Control during the Term, the Executive will remain in the employ of the
Company until the earliest of (i) a date which is six (6) months from the date
of such Potential Change of Control, (ii) the date of a Change in Control,
(iii) the date of termination by the Executive of the Executive's employment
for Good Reason or by reason of death, Disability or Retirement, or (iv) the
termination by Sierra of the Executive's employment for any reason.

         5. Compensation Other Than Severance Payments.
            ------------------------------------------

         5.1 Following a Change in Control or potential Change in Control and
during the Term, during any period that the Executive fails to perform the
Executive's full-time duties with Sierra as a result of incapacity due to
physical or mental illness, the Company shall pay the Executive's full salary
to the Executive at the rate in effect at the commencement of any such period,
together with all compensation and benefits payable to the Executive under the
terms of any compensation or benefit plan, program or arrangement maintained by
Sierra during such period, until the Executive's employment is terminated by
Sierra for Disabilitq.

         5.2 If the Executive's employment shall be terminated for any reason
following a Change in Control or potential Change in Control and during the
Term, the Company shall pay the Executive's full salary to the Executive
through the Date of Termination at the rate in effect immediately prior to the
Date of Termination or, if higher, the rate in effect immediately prior to the
first occurrence of an event or circumstance constituting Good Reason, together
with all compensation and benefits

                                      2

<PAGE>

payable to the Executive through the Date of Termination under the terms of
Sierra compensation and benefit plans, programs or arrangements as in effect
immediately prior to the Date of Termination or, if more favorable to the
Executive, as in effect immediately prior to the first occurrence of an event
or circumstance constituting Good Reason.

         5.3 If the Executive's employment shall be terminated for any
reason following a Change in Control or Potential Change in Control and during
the Term, the Company shall pay to the Executive the Executive's normal
post-termination compensation and benefits (other than any severance payments
forgone under Section 6.1a) as such payments become due, provided that the
Executive is eligible or entitled to such compensation and benefits under the
terms and conditions of any such plan or program in effect and provided further
that the Executive fully complied with all conditions and requirements of any
such plan or program, and provided further that such payments or benefits are
not otherwise precluded under the terms of this Agreement. Such post-termination
compensation and benefits shall be determined under, and paid in accordance
with, Sierra's retirement, insurance and other compensation or benefit plans,
programs and arrangements as in effect immediately prior to the Date of
Termination or, if more favorable to the Executive, as in effect immediately
prior to the occurrence of the first event or circumstance constituting Good
Reason.

         6. Severance Payments.
            ------------------

         6.1  Subject to Section 6.2 hereof, and subject to the limitations
specified in Sections 15.G.V, 15.O, in the case of an impacted Executive which
                           -
provisions shall control over the provisions of these Sections 6.1 and 6.2 if
the Executive's employment is terminated following a Change in Control or
Potential Change in Control and during the Term, other than (A) by Sierra for
Cause, (B) by reason of death or Disability, or (C) by the Executive without
Good Reason, then Sierra shall pay the Executive the amounts, and provide the
Executive the benefits, described in this Section 6.1 ("Severance Payments"),
in addition to any payments and benefits to which the Executive is entitled
under Section 5 hereof. For purposes of this Agreement, the Executive's
employment shall be deemed to have been terminated following a Change in
Control by Sierra without Cause or by the Executive with Good Reason, if (i)
the Executive's employment is terminated by Sierra without Cause prior to a
Change in Control (whether or not a Change in Control ever occurs) and such
termination was at the request or direction of a Person who has entered into an
agreement with the Company the consummation of which would constitute a Change
in Control, (ii) the Executive terminates his employment for Good Reason prior
to a Change in Control (whether or not a Change in Control ever occurs) and the
circumstance or event which constitutes Good Reason occurs at the request or
direction of such Person, or (iii) the Executive's employment is terminated by
Sierra without Cause or by the Executive for Good Reason and such termination
or the circumstance or event which constitutes Good Reason is otherwise in
connection with or in anticipation of a

                                      3

<PAGE>

Change in Control (whether or not a Change in Control ever occurs). For
purposes of any determination regarding the applicability of the immediately
preceding sentence, any position taken by the Executive shall be presumed to be
correct undess the Company establishes to the Board by clear and convincing
evidence that such position is not correct.

              (A) In lieu of any further salary payments to the Executive for
     periods subsequent to the Date of Termination and in lieu of any severance
     benefit otherwise payable to the Executive under or pursuant to any
     contract or plan, except for any severance benefits relating to or
     resulting from the Supplemental Executive Retirement Plan (provided the
     Executive is a participant in the Plan), whether as a consequence of a
     Change in Control or otherwise, and subject to the provisions of Section
     6.2(a), the Company shall pay to the Executive a lump sum severance
     payment, in cash, equal to two times the sum of (i) the Executive's base
     salary as in effect immediately prior to the Date of Termination or, if
     higher, in effect immediately prior to the first occurrence of an event or
     circumstance constituting Good Reason, and (ii) the target annual cash
     incentive award applicable to the Executive pursuant to any annual cash
     bonus or annual cash incentive plan maintained by Sierra in respect of the
     fiscal year ending immediately prior to the fiscal year in which occurs
     the Date of Termination or, if higher, immediately prior to the fiscal
     year in which occurs the first event or circumstance constituting Good
     Reason.

              (B) For the twenty-four (24) month period immediately following
     the Date of Termination, the Company shall arrange to provide the
     Executive and his dependents life, disability, accident and health
     insurance benefits substantially similar to those provided to the
     Executive and his dependents immediately prior to the Date of Termination
     or, if more favorable to the Executive, those provided to the Executive
     and his dependents immediately prior to the first occurrence of an event
     or circumstance constituting Good Reason, at no greater cost to the
     Executive than the cost to the Executive immediately prior to such date or
     occurrence; provided, however, that, unless the Executive consents to a
                 --------  -------
     different method (after taking into account the effect of such method on
     the calculation of "parachute payments" pursuant to Section 6.2 hereof),
     such health insurance benefits shall be provided through a third-party
     insurer. Benefits otherwise receivable by the Executive pursuant to this
     Section 6.1(B) shall be reduced to the extent benefits of the same type
     are received by or made available to the Executive during the twenty-four
     (24) month period following the Executive's termination of employment (and
     any such benefits received by or made available to the Executive shall be
     reported to the Company by the Executive); provided, however, that the
                                                --------  -------
     Company shall reimburse the Executive for the excess, if any, of the cost
     of such benefits to the Executive over such cost immediately prior to the
     Date of Termination or, if more favorable to the Executive, the first
     occurrence of an event or circumstance constituting Good Reason. If the
     Severance Payments

                                      4

<PAGE>

     shall be decreased pursuant to Section 6.2 hereof, and the Section 6.1(B)
     benefits which remain payable after the application of Section 6.2 hereof
     are thereafter reduced pursuant to the immediately preceding sentence, the
     Company shall, no later than five (5) business days following such
     reduction, pay to the Executive the least of (a) the amount of the
     decrease made in the Severance Payments pursuant to Section 6.2 hereof,
     (b) the amount of the subsequent reduction in these Section 6.1(B)
     benefits, or (c) the maximum amount which can be paid to the Executive
     without being, or causing any other payment to be, nondeductible by reason
     of Section 280G of the Code.

              (C) Notwithstanding any provision of any annual or long-term
     incentive plan to the contrary, the Company shall pay to the Executive a
     lump sum amount, in cash, equal to the sum of (i) any unpaid incentive
     compensation which has been allocated or awarded to the Executive for a
     completed fiscal year or other measuring period preceding the Date of
     Termination under any such plan and which, as of the Date of Termination,
     is contingent only upon the continued employment of the Executive to a
     subsequent date, and (ii) a pro rata portion to the Date of Termination of
     the aggregate value of all contingent incentive compensation awards to the
     Executive for all then uncompleted periods under any such plan, calculated
     as to each such award by multiplying the award that the Executive would
     have earned on the last day of the performance award period, assuming the
     achievement, at the target level of the individual and corporate
     performance goals established with respect to such award, by the fraction
     obtained by dividing the number of full months and any fractional portion
     of a month during such performance award period through the Date of
     Termination by the total number of months contained in such performance
     award period.

              (D) In addition to the retirement benefits to which the Executive
     is entitled under each Pension Plan or any successor plan thereto, the
     Company shall pay the Executive a lump sum amount, in cash, equal to the
     excess of (i) the actuarial equivalent of the aggregate retirement pension
     (taking into account any early retirement subsidies associated therewith
     and determined as a straight life annuity commencing at the date (but in
     no event earlier than the third anniversary of the Date of Termination) as
     of which the actuarial equivalent of such annuity is greatest) which the
     Executive would have accrued under the terms of all Pension Plans (without
     regard to any amendment to any Pension Plan made subsequent to a Change in
     Control and on or prior to the Date of Termination, which amendment
     adversely affects in any manner the computation of retirement benefits
     thereunder), determined as if the Executive were fully vested thereunder
     and had accumulated (after the Date of Termination) twenty-four (24)
     additional months of service credit thereunder and had been credited under
     each Pension Plan during such period with compensation equal to the
     Executive's compensation (as defined in such Pension Plan) during the
     twelve (12) months immediately preceding the Date of Termination gr, if
     higher, during

                                      5

<PAGE>

     the twelve months immediately prior to the first occurrence of an event or
     circumstance constituting Good Reason, over (ii) the actuarial equivalent
     of the aggregate retirement pension (taking into account any early
     retirement subsidies associated therewith and determined as a straight
     life annuity commencing at the date (but in no event earlier than the Date
     of Termination) as of which the actuarial equivalent of such annuity is
     greatest) which the Executive had accrued pursuant to the provisions of
     the Pension Plans as of the Date of Termination. For purposes of this
     Section 6.1(D), "actuarial equivalent" shall be determined using the same
     assumptions utilized under the Sierra Pacific Power Company Retirement
     Plan immediately prior to the Date of Termination. or, if more favorable
     to the Executive, immediately prior to the first occurrence of an event or
     circumstance constituting Good Reason.

              (E) If the Executive would have become entitled to benefits under
     Sierra's post-retirement health care or life insurance plans, as in effect
     immediately prior to the Date of Termination or, if more favorable to the
     Executive, as in effect immediately prior to the first occurrence of an
     event or circumstance constituting Good Reason, had the Executive's
     employment terminated at any time during the period of twenty-four (24)
     months after the Date of Termination, the Company shall provide such
     post-retirement health care or life insurance benefits to the Executive
     and the Executive's dependents commencing on the later of (i) the date on
     which such coverage would have first become available and (ii) the date on
     which benefits described in subsection (B) of this Section 6.1 terminate.

          6.2  (A)  Notwithstanding any other provisions of this Agreement, in
the event that any payment or benefit received or to be received by the
Executive in connection with a Change in Control or the termination of the
Executive's employment (whether pursuant to the terms of this Agreement or any
other plan, arrangement or agreement with the Company, any Person whose actions
result in a Change in Control or any Person affiliated with the Company or such
Person) (all such payments and benefits, including the Severance Payments,
being hereinafter called "Total Payments") would be subject (in whole or part),
to the Excise Tax, then, after taking into account any reduction in the Total
Payments provided by reason of section 280G of the Code in such other plan,
arrangement or agreement, the cash Severance Payments shall first be reduced,
and the non-cash Severance Payments shall thereafter be reduced, to the extent
necessary so that no portion of the Total Payments is subject to the Excise Tax
but only if (A) the net amount of such Total Payments, as so reduced (and after
subtracting the net amount of federal, state and local income taxes on such
reduced Total Payments) is greater than or equal to (B) the net amount of such
Total Payments without such reduction (but after subtracting the net amount of
federal, state and local income taxes on such Total Payments and the amount of
Excise Tax to which the Executive would be subject in respect of such unreduced
Total Payments); provided, however, that the Executive may elect to have the
                 --------  -------
non-cash Severance Payments reduced (or eliminated) prior to any reduction of
the cash Severance Payments.

                                      6

<PAGE>

          (B)  For  purposes of determining  whether and the extent to which
the Total Payments will be subject to the Excise Tax, (i) no portion of the
Total Payments the receipt or enjoyment of which the Executive shall have
waived at such time and in such manner as not to constitute a "payment" within
the meaning of Section 280G(b) gf the Code shall be taken into account, (ii) no
portion of the Total Payments shall be taken into account which, in the opinion
of tax counsel ("Tax Counsel") reasonably acceptable to the Executive and
selected by the accounting firm (the "Auditor") which was, immediately prior to
the Change in Control, the Company's independent auditor, does not constitute a
"parachute payment" within the meaning of Section 280G(b)(2) of the Code
(including by reason of Section 280G(b)(4)(A) of the Code) and, in calculating
the Excise Tax, no portion of such Total Payments shall be taken into account
which, in the opinion of Tax Counsel, constitutes reasonable compensation for
services actually rendered, within the meaning of Section 280G(b)(4)(B) of the
Code, in excess of the Base Amount allocable to such reasonable compensation,
and (iii) the value of any non-cash benefit or any deferred payment or benefit
included in the Total Payments shall be determined by the Auditor in accordance
with the principles of Sections 280G(d)(3) and (4) of the Code.

          (C)  At the time that  payments  are made under this  Agreement,  the
Company shall provide the Executive with a written statement setting forth the
manner in which such payments were calculated and the basis for such
calculations including, without limitation, any opinions or other advice the
Company has received from Tax Counsel, the Auditor or other advisors or
consultants (and any such opinions or advice which are in writing shall be
attached to the statement). If the Executive objects to the Company's
calculations, the Company shall pay to the Executive such portion of the
Severance Payments (up to 100% thereof) as the Executive with concurrence of
tax counsel determine are necessary to result in the proper application of
subsection A of this Section 6.2.

          6.3 The payments provided in subsections (A), (C) and (D) of Section
6.1 hereof shall be made not later than the fifth day following the Date of
Termination; provided, however, that if the amounts of such payments, and the
             --------  -------
limitation on such payments set forth in Section 6.2 hereof, cannot be finally
determined on or before such day, the Company shall pay to the Executive on
such day an estimate, as determined in good faith by the Executive of the
minimum amount of such payments to which the Executive is clearly entitled, but
in no event to exceed two times the sum of base pay and target annual cash
incentive, and shall pay the remainder of such payments (together with interest
on the unpaid remainder (or on all such payments to the extent the Company
fails to make such payments when due) at 120% of the rate provided in Section
1274(b)(2)(B) of the Code) as soon as the amount thereof can be determined but
in no event later than the thirtieth (30th) day after the Date of Termination.
In the eveft that the amount of the estimated payments exceeds the amount
subsequently determined to have been due, such excess shall constitute a loan
by the Company to the Executive, payable

                                      7

<PAGE>

on the fifth (5th) business day after demand by the Company (together with
interest at 120% of the rate provided in Section 1274(b)(2)(B) of the Code).

          6.4 The Company also shall pay to the Executive all legal fees and
expenses incurred by the Executive in disputing in good faith any issue
hereunder relating to the termination of the Executive's employment, in seeking
in good faith to obtain or enforce any benefit or right provided by this
Agreement or in connection with any tax audit or proceeding to the extent
attributable to the application of Section 4999 of the Code to any payment or
benefit provided hereunder. Such payments shall be made within five (5)
business days after delivery of the Executive's written requests for payment
accompanied with such evidence of fees and expenses incurred as the Company
reasonably may require.

          6.5 Notwithstanding any other provision of this agreement, except as
otherwise permitted by this Agreement, if the Executive is entitled to and
claims benefits under or pursuant to any other change in control agreement
entered into between Company or Sierra and the executive, or any terms or
conditions thereunder, the executive shall not be entitled to any of the
severance benefits or any other benefits under this agreement or terms or
conditions of this agreement.

          7. Termination Procedures and Compensation During Dispute.
             ------------------------------------------------------

          7.1 Notice of Termination. After a Change in Control or potential
              ---------------------
Change in Control and during the Term, any purported termination of the
Executive's employment (other than by reason of death) shall be communicated by
written Notice of Termination from one party hereto to the other party hereto
in accordance with Section 10 hereof. For purposes of this Agreement, a "Notice
of Termination" shall mean a notice which shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of the Executive's employment under the provision so indicated.
Further, a Notice of Termination for Cause is required to include a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters
(3/4) of the entire membership of the Board at a meeting of the Board which was
called and held for the purpose of considering such termination (after
reasonable notice to the Executive and an opportunity for the Executive,
together with the Executive's counsel, to be heard before the Board) finding
that, in the good faith opinion of the Board, the Executive was guilty of
conduct set forth in clause (i) or (ii) of the definition of Cause herein, and
specifying the particulars thereof in detail.

          7.2 Date of Termination. "Date of Termination," with respect to any
              -------------------
purported termination of the Executive's employment after a Change in Control
or potential Change in Control and during the Term, shall mean (i) if the
Executive's employment is terminated for Disability, thirty (30) days after
Notice of Termination is given (provided that the Executive shall not have
returned to the full-time performance of the Executive's duties during such
thirty (30) day period), and (ii) if

                                      8

<PAGE>

the Executive's employment is terminated for any other reason, the date
specified in the Notice of Termination (which, in the case of a termination by
Sierra, shall not be less than thirty (30) days (except in the case of a
termination for Cause) and, in the case of a termination by the Executive,
shall not be less than fifteen (15) days nor more than sixty (60) days,
respectively, from the date such Notice of Termination is given).

          7.3 Dispute Concerning Termination. If within fifteen (15) days after
              ------------------------------
any Notice of Termination is given, or, if later, prior to the Date of
Termination (as determined without regard to this Section 7.3), the party
receiving such Notice of Termination notifies the other party that a dispute
exists concerning the termination, the Date of Termination shall be extended
until the earlier of (i) the date on which the Term ends or (ii) the date on
which the dispute is finally resolved, either by mutual written agreement of
the parties or by a final judgment, order or decree of an arbitrator or a court
of competent jurisdiction (which is not appealable or with respect to which the
time for appeal therefrom has expired and no appeal has been perfected);
provided, however, that the Date of Termination shall be extended for a period
--------  -------
not to exceed six months by a notice of dispute given by the Executive and then
only if such notice is given in good faith and the Executive pursues the
resolution of such dispute with reasonable diligence and agrees to reimburse
the Company for all compensation received from and after the date of
termination specified in Section 7.2 in the event the dispute is not resolved
in the Executive's favor.

          7.4 Compensation During Dispute. If a purported termination occurs
              ---------------------------
following a Change in Control or potential Change in Control and during the
Term and the Date of Termination is extended in accordance with Section 7.3
hereof, the Company shall continue to pay the Executive the full compensation
in effect when the notice giving rise to the dispute was given (including, but
not limited to, salary) and continue the Executive as a participant in all
compensation, benefit and insurance plans in which the Executive was
participating when the notice giving rise to the dispute was given, until the
Date of Termination, as determined in accordance with Section 7.3 hereof.
Amounts paid under this Section 7.4 are in addition to all other amounts due
under this Agreement (other than those due under Section 5.2 hereof) and shall
not be offset against or reduce any other amounts due under this Agreement,
except that if the notice of dispute is given by the Executive and the term is
extended pursuant to Section 7.3 beyond the date specified in accordance with
Section 7.2 and the Executive does not prevail in his dispute, Executive shall
reimburse to and refund to the Company all compensation paid after the
termination date specified in Section 7.2.

          8.  No Mitigation.  The Company agrees that, if the Executive's
              -------------
employment with Sierra terminates during the Term, the Executive is not
required to seek other employment or to attempt in any way to reduce any
amounts payable to the Executive by the Company pursuant to Section 6 hereof or
Section 7.4 hereof. Further, the amount of any payment or benefit provided for
in this Agreement (other

                                      9

<PAGE>

than Section 6.1(B) hereof) shall not be reduced by any compensation earned by
the Executive as the result of employment by another employer, by retirement
benefits, by offset against any amount claimed to be owed by the Executive to
the Company, or otherwise.

          9. Successors; Binding Agreement.
             -----------------------------

          9.1 In addition to any obligations imposed by law upon any successor
to the Company, the Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. Failure of the Company to obtain such assumption and agreement
prior to the effectiveness of any such succession shall be a breach of this
Agreement and shall entitle the Executive to compensation from the Company in
the same amount and on the same terms as the Executive would be entitled to
hereunder if the Executive were to terminate the Executive's employment for
Good Reason after a Change in Control, except that, for purposes of
implementing the foregoing, the date on which any such succession becomes
effective shall be deemed the Date of Termination.

          9.2 This Agreement shall inure to the benefit of and be enforceable
by the Executive's personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees. If the
Executive shall die while any amount would still be payable to the Executive
hereunder (other than amounts which, by their terms, terminate upon the death
of the Executive) if the Executive had continued to live, all such amounts,
unless otherwise provided herein, shall be paid in accordance with the terms of
this Agreement to the executors, personal representatives or administrators of
the Executive's estate.

          10. Notices. For the purpose of this Agreement, notices and all other
              -------
communications provided for in the Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
registered mail, return receipt requested, postage prepaid, addressed, if to
the Executive, to the address inserted below the Executive's signature on the
final page hereof and, if to the Company, to the address set forth below, or to
such other address as either party may have furnished to the other in writing
in accordance herewith, except that notice of change of address shall be
effective only upon actual receipt:

          To the Company:

                 Sierra Power Resources
                 6226 West Sahara Avenue
                 Las Vegas, Nevada 89146
                 Attention:  General Counsel

                                      10

<PAGE>

          11. Miscellaneous. No provision of this Agreement may be modified,
              -------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive and the Company, acting through such
officer as may be specifically designated by the Board. No waiver by either
party hereto at any time of any breach by the other party hereto of, or of any
lack of compliance with, any condition or provision of this Agreement to be
performed by such other party shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. This
Agreement supersedes any other agreements or representations, oral or
otherwise, express or implied, with respect to the subject matter hereof which
have been made by either party; provided, however, that this Agreement shall
                                --------  -------
supersede any agreement setting forth the terms and conditions of the
Executive's employment with Sierra only in the event that the Executive's
employment with Sierra is terminated on or following a Change in Control or
potential Change in Control, by Sierra other than for Cause or by the Executive
other than for Good Reason.  The validity, interpretation, construction and
performance of this Agreement shall be governed by the laws of the State of
Nevada. All references to sections of the Exchange Act or the Code shall be
deemed also to refer to any successor provisions to such sections. Any payments
provided for hereunder shall be paid net of any applicable withholding required
under federal, state or local law and any additional withholding to which the
Executive has agreed. The obligations of the Company and the Executive under
this Agreement which by their nature may require either partial or total
performance after the expiration of the Term (including, without limitation,
those under Sections 6 and 7 hereof) shall survive such expiration.

          12. Validity.
              --------

          12.1  The invalidity or unenforceability of any provision of this
Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.

          13.  Counterparts.  This Agreement may be executed in several
               ------------
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

          14. Settlement of Dispute; Arbitration.
              ----------------------------------

          14.1 All claims by the Executive for benefits under this Agreement
shall be directed to and determined by the Board and shall be in writing. Any
denial by the Board of a claim for benefits under this Agreement shall be
delivered to the Executive in writing and shall set forth the specific reasons
for the denial and the specific provisions of this Agreement relied upon. The
Board shall afford a reasonable opportunity to the Executive for a review of
the decision denying a claim and shall further allow the Executive to appeal to
the Board a decision of the Board

                                      11

<PAGE>

within sixty (60) days after notification by the Board that the Executive's
claim has been denied.

          14.2 Any further dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration in
Las Vegas, Nevada in accordance with the rules of the American Arbitration
Association then in effect; provided, however, that the evidentiary standards
                            --------  -------
set forth in this Agreement shall apply. Judgment may be entered on the
arbitrator's award in any court having jurisdiction. Notwithstanding any
provision of this Agreement to the contrary, the Executive shall be entitled to
seek specific performance of the Executive's right to be paid until the Date of
Termination during the pendency of any dispute or controversy arising under or
in connection with this Agreement.

          15. Definitions. For purposes of this Agreement, the following terms
              -----------
shall have the meanings indicated below:

          (A) "Affiliate" shall have the meaning set forth in Rule 12b-2
promulgated under Section 12 of the Exchange Act or any successor replacement
rule.

          (B) "Auditor" shall have the meaning set forth in Section 6.2 hereof.

          (C) "Base Amount" shall have the meaning set forth in Section
280G(b)(3) of the Code.

          (D) "Beneficial Owner" shall have the meaning set forth in Rule 13d-3
under the Exchange Act.

          (E) "Board" shall mean the Board of Directors of the Company.

          (F) "Cause" for termination by Sierra of the Executive's employment
shall mean (i) the willful and continued failure by the Executive to
substantially perform the Executive's duties with Sierra (other than any such
failure resulting from the Executive's incapacity due to physical or mental
illness or any such actual or anticipated failure after the issuance of a
Notice of Termination for Good Reason by the Executive pursuant to Section 7.1
hereof) after a written demand for substantial performance is delivered to the
Executive by the Board, which demand specifically identifies the manner in
which the Board believes that the Executive has not substantially performed the
Executive's duties, or (ii) the willful engaging by the Executive in conduct
which is demonstrably and materially injurious to Sierra, monetarily or
otherwise. For purposes of clauses (i) and (ii) of this definition, (x) no act,
or failure to act, on the Executive's part shall be deemed "willful" unless
done, or omitted to be done, by the Executive not in good faith and without
reasonable belief that the Executive's act, or failure to act, was in the best
interest of Sierra and (y) in the event of a dispute concerning the application
of this provision, no claim by Sierra

                                      12

<PAGE>

that Cause exists shall be given effect unless Sierra establishes to the Board
by clear and convincing evidence that Cause exists.

          (G) A "Change in Control" shall be deemed to have occurred if the
event set forth in any one of the following paragraphs shall have occurred:

               (I) any Person is or becomes the Beneficial Owner, directly or
          indirectly, of securities of the Company (not including in the
          securities beneficially owned by such Person any securities acquired
          directly from the Company or its affiliates) representing 30% or more
          of the combined voting power of the Company's then outstanding
          securities, excluding any Person who becomes such a Beneficial Owner
          in connection with a transaction described in clause (i) of paragraph
          (III) below; or

               (II) the following individuals cease for any reason to
          constitute a majority of the number of directors then serving:
          individuals who, on the date hereof, constitute the Board and any new
          director (other than a director whose initial assumption of office is
          in connection with an actual or threatened election coftest,
          including but not limited to a consent solicitation, relating to the
          election of directors of the Company) whose appointment or election
          by the Board or nomination for election by the Company's stockholders
          was approved or recommended by a vote of at least two-thirds (2/3) of
          the directors then still in office who either were directors on the
          date hereof or whose appointment, election or nomination for election
          was previously so approved or recommended; or

               (III) there is consummated a merger or consolidation of the
          Company or any direct or indirect subsidiary of the Company with any
          other corporation, other than (i) a merger or consolidation which
          would result in the voting securities of the Company outstanding
          immediately prior to such merger or consolidation continuing to
          represent (either by remaining outstanding or by being converted into
          voting securities of the surviving entity or any parent thereof), in
          combination with the ownership of any trustee or other fiduciary
          holding securities under an employee benefit plan of the Company or
          any subsidiary of the Company, at least 66.66% of the combined voting
          power of the securities of the Company or such surviving entity or
          any parent thereof outstanding immediately after such merger or
          consolidation, or (ii) a merger or consolidation effected to
          implement a recapitalization of the Company (or similar transaction)
          in which no Person is or becomes the Beneficial Owner, directly or
          indirectly, of securities of the Company (not including in the
          securities Beneficially Owned by such Person any securities acquired
          directly from the Company or its Affiliates other than in connection
          with the acquisition by the Company

                                      13

<PAGE>

          or its Affiliates of a business) representing 30% or more of the
          combined voting power of the Company's then outstanding securities;
          or

               (IV) the stockholders of the Company or a court or regulatory
          agency having jurisdiction over the matter approve a plan of complete
          liquidation or dissolution of the Company or there is consummated an
          agreement for or a court or regulatory agency having jurisdiction
          over the matter approves the sale or disposition by the Company of
          all or substantially all of the Company's assets, other than a sale
          or disposition by the Company of all or substantially all of the
          Company's assets to an entity, at least 66.66% of the combined voting
          power of the voting securities of which are owned by stockholders of
          the Company in substantially the same proportions as their ownership
          of the Company immediately prior to such sale.

                     (V) As to and with respect only to Impacted Executives as
          defined in Section 15.O, there is (a) consummated a sale of a
          majority of the issued and outstanding stock of Sierra Pacific Power
          Company or Nevada Power Company, and/or there is consummated an
          agreement for the sale or disposition by Sierra Pacific Power Company
          or Nevada Power Company of all or substantially all of either of
          their assets, or a plan of complete liquidation or dissolution or
          sale or disposition of all or substantially all of the assets of
          either Sierra Pacific Power Company or Nevada Power Company is
          approved or adopted by the stockholders or any court or agency having
          jurisdiction over the matter, and (b) in addition the event is not an
          event which is also described in or otherwise satisfies the
          requirements of Sections G(I) through (IV).

Notwithstanding the foregoing, except for Section G(IV) or (V) described
above, a "Change in Control" shall not be deemed to have occurred by virtue of
the consummation of any transaction or series of integrated transactions
immediately following which the record holders of the common stock of the
Company immediately prior to such transaction or series of transactions
continue to have substantially the same proportionate ownership in an entity
which owns all or substantially all of the assets of the Company immediately
following such transaction or series of transactions.

          (H) "Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.

          (I) "Company" shall mean Sierra Pacific Resources and, except in
determining under Section 15(G) hereof whether or not any Change in Control of
the Company has occurred, shall include any successor to its business and/or
assets

                                      14

<PAGE>

which assumes and agrees to perform this Agreement by operation of law, or
otherwise.

          (J) "Date of Termination" shall have the meaning set forth in Section
7.2 hereof.

          (K) "Disability" shall be deemed the reason for the termination by
Sierra of the Executive's employment, if, as a result of the Executive's
incapacity due to physical or mental illness, the Executive shall have been
absent from the full-time performance of the Executive's duties with Sierra for
a period of six (6) consecutive months, Sierra shall have given the Executive a
Notice of Termination for Disability, and, within thirty (30) days after such
Notice of Termination is given, the Executive shall not have returned to the
full-time performance of the Executive's duties.

          (L) "Exchange  Act" shall mean the Securities Exchange Act of 1934,
as amended  from time to time.

          (M) "Executive" shall mean the individual named in the first
paragraph of this Agreement.

          (N) "Good Reason" for termination by the Executive of the Executive's
employment shall mean the occurrence (without the Executive's express written
consent) after any Change in Control, or prior to a Change in Control under the
circumstances described in clauses (ii) and (iii) of the second sentence of
Section 6.1 hereof (treating all references in paragraphs (I) through (VII)
below to a "Change in Control" as references to a "Potential Change in
Control"), of any one of the following acts by Sierra, or failures by Sierra to
act, unless, in the case of any act or failure to act described in paragraphs
(I), (IV), (V) or (VI) below, such act or failure to act is corrected prior to
the Date of Termination specified in the Notice of Termination given in respect
thereof:

               (I) the assignment to the Executive of any duties substantially
          below the Executive's status as a senior executive officer of Sierra
          or a substantial adverse reduction in the nature or status of the
          Executive's responsibilities from those in effect immediately prior
          to the Change in Control other than any such alteration primarily
          attributable to the fact that the Company may no longer be a public
          company;

               (II) a reduction by Sierra in the Executive's annual base salary
          as in effect on the date hereof or as the same may be increased from
          time to time except for across-the-board salary reductions similarly
          affecting all senior executives of Sierra and all senior executives
          of any Person in control of Sierra;

               (III) the failure by Sierra to pay to the Executive any portion
          of the Executive's current compensation except pursuant to an

                                      15

<PAGE>

          across-the-board compensation deferral or good faith reduction in
          compensation necessitated by unfavorable exigent business conditions
          or circumstances similarly affecting all senior executives of Sierra
          and all senior executives of any Person in control of Sierra, or to
          pay to the Executive any portion of an installment of deferred
          compensation under any deferred compensation program of Sierra,
          within thirty (30) days of the date such compensation as due;

               (IV) the failure by Sierra to continue in effect any
          compensation plan in which the Executive participates immediately
          prior to the Change in Control which is material to the Executive's
          total compensation, including but not limited to the Company's
          Officer and Senior Managers Annual Incentive Plan, Executive
          Long-Term Incentive Plan, Long-Term Performance Share Program and
          Stock Option Plan or any substitute plans adopted prior to the Change
          in Control, unless an equitable arrangement (embodied in an ongoing
          substitute or alternative plan) has been made with respect to such
          plan, or the failure by Sierra to continue the Executive's
          participation therein (or in such substitute or alternative plan) on
          a basis not materially less favorable, both in terms of the amount or
          timing of payment of benefits provided and the level of the
          Executive's participation relative to other participants, as existed
          immediately prior to the Change in Control;

               (V) the failure by Sierra to continue to provide the Executive
          with benefits substantially similar tg those enjoyed by the Executive
          under any of Sierra's pension, savings, life insurance, medical,
          health and accident, or disability plans in which the Executive was
          participating immediately prior to the Change in Control (except for
          across the board changes similarly affecting all senior executives of
          Sierra and all senior executives of any Person in control of Sierra),
          the taking of any other action by Sierra which would directly or
          indirectly materially reduce any of such benefits or deprive the
          Executive of any material fringe benefit enjoyed by the Executive at
          the time of the Change in Control, or the failure by Sierra to
          provide the Executive with substantially the same number of paid
          vacation days to which the Executive is entitled on the basis of
          years of service with Sierra in accordance with Sierra's normal
          vacation policy in effect at the time of the Change in Control; or

               (VI) any purported termination of the Executive's employment
          which is not effected pursuant to a Notice of Termination satisfying
          the requirements of Section 7.1 hereof; for purposes of this
          Agreement, no such purported termination shall be effective.

                                      16

<PAGE>

          The Executive's right to terminate the Executive's employment for
Good Reason shall not be affected by the Executive's incapacity due to physical
or mental illness. The Executive's continued employment shall not constitute
consent to, or a waiver of rights with respect to, any act or failure to act
constituting Good Reason hereunder.

          For purposes of any determination regarding the existence of Good
Reason, any claim by the Executive that Good Reason exists shall be presumed to
be correct unless the Company establishes to the Board by clear and convincing
evidence that Good Reason does not exist.

          (O)  "Impacted Executive" shall mean (1) an Executive other than an
Executive defined in Section O(2) whose employment is terminated within the
term for reasons other than cause, following an Event described in Section
15.G.(V), or (2) an Executive who following an Event described in Section
15.G(V) accepts or refuses to accept offered employment with the successor to
the entity, business, or assets of Sierra Pacific Power Company or Nevada Power
Company. An Impacted Executive is entitled to receive Impacted Executive
Compensation.

          (P)  "Impacted Executive Compensation." If the Executive is an
Impacted Executive as defined in Section O(1), he shall receive the
compensation specified in Sections 5 and 6 in strict accordance with their
terms and conditions. If the Executive is an Impacted Executive as defined in
Section (2), then the lump sum severance payment specified in Section 6.1(a)
shall be limited to two times the difference between (a) the sum of the
Executive's base salary as in effect immediately prior to the date the
Executive became an Impacted Executive and the target annual tax bonus or
incentive applicable to the Executive in respect of the fiscal year immediately
prior to the fiscal year in which the Executive became an Impacted Executive,
and (b) the sum of the Executive's base salary and target annual cash incentive
offered by the successor.

          (Q)  "Notice of Termination" shall have the meaning set forth in
Section 7.1 hereof.

          (R)  "Pension Plan" shall mean any tax-qualified, supplemental or
excess benefit pension plan maintained by Sierra and any other plan or
agreement entered into between the Executive and Sierra which is designed to
provide the Executive with supplemental or additional retirement benefits or
credits.

          (S)  "Person" shall have the meaning given in Section 3(a)(9) of the
Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof,
except that such term shall not include (i) the Company or any of its
subsidiaries, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its Affilaates, (iii) an
underwriter temporarily holding securities pursuant to an offering of such
securities, or (iv) a corporation owned, directly or indirectly, by the

                                      17

<PAGE>

stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company.

          (T) "Potential Change in Control" shall be deemed to have occurred if
the event set forth in any one of the following paragraphs shall have occurred:

               (I) the Company enters into an agreement, the consummation of
          which would result in the occurrence of a Change in Control;

               (II) the Company or any Person publicly announces an intention
          to take or to consider taking actions which, if consummated, would
          constitute a Change in Control;

               (III) any Person becomes the Beneficial Owner, directly or
          indirectly, of securities of the Company representing 15% or more of
          either the then outstanding shares of common stock of the Company or
          the combined voting power of the Company's then outstanding
          securities (not including in the securities beneficially owned by
          such Person any securities acquired directly from the Company or its
          affiliates); or

               (IV) any of the items in R(I) through (III) occurs which is
          connected with, arises out of, is caused by, or results from another
          Potential Change in Control.

          (U) "Retirement" shall be deemed the reason for the termination by
the Executive of the Executive's employment if such employment is terminated in
accordance with Sierra's retirement policy, including early retirement,
generally applicable to its salaried employees.

          (V) "Severance Payments" shall have the meaning set forth in Section
6.1 hereof.

          (W) "Tax Counsel" shall have the meaning set forth in Section 6.2
hereof.

          (X) "Term" shall mean the period of time described in Section 2
hereof (including any extension, continuation or termination described
therein).

                                      18

<PAGE>

          (Y) "Total Payments" shall mean those payments so described in
Section 6.2 hereof.

                                 Sierra Pacific Resources

                                 By:__________________________________
                                    Walter M. Higgins
                                    Chairman, President & CEO

                                 ______________________________________
                                 John E. Brown

                                      19<PAGE>

                                                                   EXHIBIT 10(E)

                                                               [EXECUTION COPY]

===============================================================================

                                 $200,000,000

                               CREDIT AGREEMENT

                                 dated as of

                              November 30, 2001

                                    among

                             NEVADA POWER COMPANY,

                        UNION BANK OF CALIFORNIA, N.A.,
                 as Sole Bookrunner and Administrative Agent,

                            WELLS FARGO BANK, N.A.,
                             as Syndication Agent,

                                      and

                                 BANK ONE, NA,
                                BNP PARIBAS and
                               MELLON BANK, N.A.,
                          as Co-Documentation Agents,

                                      and

                  the LENDERS party hereto from time to time

                                Co-Arranged By

                      UNION BANK OF CALIFORNIA, N.A. and
                            WELLS FARGO BANK, N.A.

===============================================================================

<PAGE>

                               TABLE OF CONTENTS

                                                                           Page
                                                                           ----

ARTICLE I   DEFINITIONS; CONSTRUCTION.........................................1

     SECTION 1.01 Defined Terms...............................................1
     SECTION 1.02 Classification of Loans and Borrowings.....................16
     SECTION 1.03 Terms Generally............................................16
     SECTION 1.04 Accounting Terms; GAAP.....................................16

ARTICLE II  THE CREDITS......................................................17

     SECTION 2.01 The Commitments............................................17
     SECTION 2.02 Loans and Borrowings.......................................17
     SECTION 2.03 Requests for Revolving Borrowings..........................18
     SECTION 2.04 Funding of Borrowings......................................18
     SECTION 2.05 Interest Elections.........................................19
     SECTION 2.06 Termination, Reduction and Extension of Commitments....... 20
     SECTION 2.07 Repayment of Loans; Evidence of Debt.......................23
     SECTION 2.08 Prepayment of Loans........................................24
     SECTION 2.09 Fees.......................................................24
     SECTION 2.10 Interest...................................................25
     SECTION 2.11 Alternate Rate of Interest.................................26
     SECTION 2.12 Increased Costs............................................26
     SECTION 2.13 Break Funding Payments.....................................27
     SECTION 2.14 Taxes......................................................27
     SECTION 2.15 Payments Generally; Pro Rata Treatment; Sharing of
                  Set-offs...................................................28
     SECTION 2.16 Mitigation Obligations; Replacement of Lenders.............30

ARTICLE III REPRESENTATIONS AND WARRANTIES...................................31

     SECTION 3.01 Corporate Status...........................................31
     SECTION 3.02 Corporate Power and Authorization..........................31
     SECTION 3.03 Execution and Binding Effect...............................31
     SECTION 3.04 Governmental Approvals and Filings.........................32
     SECTION 3.05 Absence of Conflicts.......................................32
     SECTION 3.06 Audited Financial Statements...............................32
     SECTION 3.07 Interim Financial Statements...............................33
     SECTION 3.08 Absence of Undisclosed Liabilities.........................33
     SECTION 3.09 Absence of Material Adverse Change.........................33
     SECTION 3.10 Accurate and Complete Disclosure...........................33
     SECTION 3.11 Margin Regulations.........................................33
     SECTION 3.12 Litigation.................................................34
     SECTION 3.13 Absence of Events of Default...............................34
     SECTION 3.14 Absence of Other Conflicts.................................34
     SECTION 3.15 Insurance..................................................34
     SECTION 3.16 Title to Property; No Liens................................35
     SECTION 3.17 Taxes......................................................35

<PAGE>

                                                                           Page
                                                                           ----
                               TABLE OF CONTENTS
                                  (Continued)

     SECTION 3.18 Borrower Not An Investment Company.........................35
     SECTION 3.19 Environmental Matters......................................35
     SECTION 3.20 ERISA......................................................36
     SECTION 3.21 Pari Passu Status..........................................37
     SECTION 3.22 Indebtedness...............................................37
     SECTION 3.23 Collateral Bonds...........................................37

ARTICLE IV  CONDITIONS.......................................................38

     SECTION 4.01 Effective Date.............................................38
     SECTION 4.02 Conditions to All Loans....................................41

ARTICLE V   AFFIRMATIVE COVENANTS............................................41

     SECTION 5.01 Basic Reporting Requirements...............................42
     SECTION 5.02 Insurance..................................................45
     SECTION 5.03 Payment of Taxes and Other Potential Charges and Priority
                  Claims.....................................................45
     SECTION 5.04 Preservation of Corporate Status and Franchises............45
     SECTION 5.05 Governmental Approvals and Filings.........................46
     SECTION 5.06 Maintenance of Properties..................................46
     SECTION 5.07 Avoidance of Other Conflicts...............................46
     SECTION 5.08 Financial Accounting Practices.............................46
     SECTION 5.09 Use of Proceeds............................................47
     SECTION 5.10 End of Fiscal Periods......................................47

ARTICLE VI  NEGATIVE COVENANTS...............................................47

     SECTION 6.01 Financial Covenants........................................47
     SECTION 6.02 Liens......................................................47
     SECTION 6.03 Mergers....................................................49
     SECTION 6.04 Dispositions of Properties.................................49
     SECTION 6.05 Investments and Acquisitions...............................50
     SECTION 6.06 Dividends and Stock Repurchases............................50
     SECTION 6.07 Transactions with Affiliates...............................50
     SECTION 6.08 Change of Business.........................................50
     SECTION 6.09 Equal and Ratable Lien; Grant of Security Interest in
                  Certain Events.............................................51
     SECTION 6.10 Restrictive Agreements.....................................52

ARTICLE VII DEFAULTS.........................................................52

     SECTION 7.01 Events of Default..........................................52
     SECTION 7.02 Consequences of an Event of Default........................54

ARTICLE VIII THE AGENTS......................................................55

     SECTION 8.01 Appointment................................................55
     SECTION 8.02 General Nature of Administrative Agent's Duties............56
     SECTION 8.03 Exercise of Powers.........................................56

                                     -ii-

<PAGE>

                                                                           Page
                                                                           ----
                               TABLE OF CONTENTS
                                  (Continued)

     SECTION 8.04 General Exculpatory Provisions.............................57
     SECTION 8.05 Administration by the Administrative Agent.................57
     SECTION 8.06 Lenders Not Relying on Administrative Agent or Other
                  Lenders....................................................58
     SECTION 8.07 Indemnification............................................59
     SECTION 8.08 Administrative Agent in its Individual Capacity............59
     SECTION 8.09 Holders of Notes...........................................59
     SECTION 8.10 Successor Administrative Agent.............................60
     SECTION 8.11 Additional Administrative Agents...........................60
     SECTION 8.12 Calculations...............................................61
     SECTION 8.13 Syndication Agent..........................................61
     SECTION 8.14 Sole Bookrunner............................................61
     SECTION 8.15 Co-Documentation Agents....................................61

ARTICLE IX  MISCELLANEOUS....................................................61

     SECTION 9.01 Amendments and Waivers.....................................61
     SECTION 9.02 No Implied Waiver; Cumulative Remedies.....................62
     SECTION 9.03 Notices....................................................63
     SECTION 9.04 Expenses; Taxes; Indemnity.................................63
     SECTION 9.05 Severability...............................................64
     SECTION 9.06 Prior Understandings.......................................65
     SECTION 9.07 Duration; Survival.........................................65
     SECTION 9.08 Counterparts...............................................65
     SECTION 9.09 Limitation on Payments.....................................65
     SECTION 9.10 Set-Off....................................................65
     SECTION 9.11 Sharing of Collections.....................................66
     SECTION 9.12 Successors and Assigns; Participations; Assignments........67
     SECTION 9.13 Governing Law; Submission to Jurisdiction Waiver of Jury
                  Trial; Limitation of Liability.............................70

                                   SCHEDULES
                                   ---------
Schedule I       COMMITMENTS
Schedule II      JURISDICTIONS
Schedule III     LITIGATION
Schedule IV      LIENS
Schedule V       ENVIRONMENTAL CLAIMS
Schedule VI      EXISTING INDEBTEDNESS

                                    EXHIBITS
                                    --------

Exhibit A        FORM OF ASSIGNMENT AND ACCEPTANCE
Exhibit B        FORM OF BORROWING REQUEST
Exhibit C        FORM OF PROMISSORY NOTE
Exhibit D        FORM OF QUARTERLY COMPLIANCE CERTIFICATE

                                     -iii-

<PAGE>

          CREDIT AGREEMENT, dated as of November 30, 2001, among NEVADA POWER
COMPANY, a Nevada corporation, UNION BANK OF CALIFORNIA, N.A., as Sole
Bookrunner and Administrative Agent, WELLS FARGO BANK, N.A., as Syndication
Agent, BANK ONE, NA, BNP PARIBAS and MELLON BANK, N.A., as Co- Documentation
Agents, the LENDERS party hereto from time to time, and UNION BANK OF
CALIFORNIA, N.A. and WELLS FARGO BANK, N.A., as Co-Lead Arrangers.

                              W I T N E S S E T H:
                              - - - - - - - - - --

                  WHEREAS, the Borrower (as defined below) has requested, and
the Lenders (as defined below) have agreed to make available, the credit
facilities described below upon the terms and conditions contained herein.

                  NOW, THEREFORE, in consideration of the premises and of the
mutual covenants herein contained and intending to be legally bound hereby, the
parties hereto agree as follows:

                                    ARTICLE I
                            DEFINITIONS; CONSTRUCTION

                  SECTION 1.01  Defined Terms.
                                -------------

                  As used in this Agreement, the following terms have the
following meanings:

                  "ABR", when used in reference to any Loan or Borrowing, refers
                   ---
to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Alternate Base Rate.

                  "Acceptable Rate Case" means the issuance of a final,
                   --------------------
nonappealable order of the Public Utilities Commission of Nevada with respect to
the Borrower's application to clear its deferred energy accounts, which
application is scheduled to be filed on or before December 1, 2002, provided
                                                                    --------
that such order (i) finds that the Borrower's electricity rates that went into
effect on March 1, 2001 pursuant to the Comprehensive Energy Plan are just and
reasonable and reflect prudent business practices and (ii) authorizes the
Borrower to recover 100% of its deferred fuel and power costs accrued through
the date of such application.

                  "Acquisition" means any transaction, or any series of related
                   -----------
transactions, consummated after the Effective Date, by which the Borrower and/or
any of its Subsidiaries directly or indirectly (a) acquires any ongoing business
or all or substantially all of the assets of any Person engaged in any ongoing
business, whether through purchase of assets, merger or otherwise, (b) acquires
control of securities of a Person engaged in an ongoing business representing
more than 50% of the ordinary voting power for the election of directors or
other governing position if the business affairs of such Person are managed by a
board of directors or other governing body or (c) acquires control of more than
50% of the ownership interest in any partnership, joint venture, limited
liability company, business trust or other Person engaged in an ongoing business
that is not managed by a board of directors or other governing body.

<PAGE>

                  "Adjusted LIBO Rate" means, with respect to any Eurodollar
                   ------------------
Revolving Borrowing for any Interest Period, an interest rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to (a) the LIBO Rate
for such Interest Period multiplied by (b) the Statutory Reserve Rate.

                  "Administrative  Agent" means Union Bank of California,  N.A.,
                   ---------------------
in its capacity as  administrative agent for the Lenders hereunder and any
successor appointed pursuant to Section 8.10.

                  "Affiliate" means any Person that directly or indirectly
                   ---------
Controls, or is under common Control with, or is Controlled by, another Person,
provided that, in any event, any Person that owns directly or indirectly
--------
securities having 20% or more of the voting power for the election of directors
or other governing body of a corporation or 20% or more of the partnership or
other ownership interests of any other Person (other than as a limited partner
of such other Person) will be deemed to Control such corporation or other
Person.

                  "Agents" means, collectively, the Administrative Agent, the
                   ------
Co-Lead Arrangers, the Sole Bookrunner, the Syndication Agent and the
Co-Documentation Agents.

                  "Alternate Base Rate" means, for any day, a rate per annum
                   -------------------
equal to the greater of (a) the Prime Rate in effect on such day and (b) the
Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. Any change in
the Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective from and including the effective date of such
change in the Prime Rate or the Federal Funds Effective Rate, respectively.

                  "Applicable Percentage" means, with respect to any Lender as
                   ---------------------
of any date of determination, the percentage of the total Commitments as of such
date represented by such Lender's Commitment as of such date. If the Commitments
have terminated or expired, the Applicable Percentages shall be determined, as
of any date of determination, based upon the percentage of the total Loans
outstanding as of such date represented by such Lender's Loans outstanding as of
such date.

                  "Applicable Rate" means, for any day, with respect to the
                   ---------------
facility fees payable hereunder or with respect to any Eurodollar Revolving Loan
or ABR Loan, as the case may be, the applicable rate per annum set forth
opposite the caption "Facility Fee", "Eurodollar Spread" or "ABR Spread", as the
case may be, in the applicable pricing table set forth below, based on the
ratings by S&P and Moody's applicable on such day to the Index Debt of Borrower:

                                      -2-

<PAGE>

A.       Prior to the Occurrence of an Acceptable Rate Case:

<TABLE>
<CAPTION>
====================================================================================================================
                               Category 1       Category 2        Category 3        Category 4        Category 5
                               ----------       -----------       -----------       -----------       ----------

                             A- or higher    BBB+ or higher     BBB or higher     BBB- or higher    BB+ or lower
                             by S&P and A3   by S&P and Baa1    by S&P and Baa2   by S&P and Baa3   by S&P or Ba1
                             or higher by    or higher by       or higher by      or higher by      or lower by
                             Moody's         Moody's            Moody's           Moody's           Moody's
====================================================================================================================
<S>                              <C>              <C>                <C>               <C>               <C>
Facility Fee                     0.10%            0.125%             0.15%             0.20%             0.30%
--------------------------------------------------------------------------------------------------------------------
                                 0.65%            0.875%             0.975%            1.05%             1.25%
Eurodollar Spread
--------------------------------------------------------------------------------------------------------------------

                                   0%               0%                 0%              0.05%             0.25%
ABR Spread
--------------------------------------------------------------------------------------------------------------------
</TABLE>

Notwithstanding the foregoing, in the event that, and at all times during which,
the aggregate principal amount of the Loans outstanding hereunder exceeds 50% of
the total Commitments, (i) each of the foregoing Eurodollar Spreads shall be
increased by (A) in the case of Category 1, 0.10% per annum, (B) in the case of
each of Category 2, Category 3 and Category 4, 0.125% per annum, and (C) in the
case of Category 5, 0.25% per annum, and (ii) the foregoing ABR Spreads shall be
increased by (A) in the case of Category 3, 0.10% per annum, (B) in the case of
Category 4, 0.125% per annum, and (C) in the case of Category 5, 0.25% per
annum.

B.       Upon and After the Occurrence of an Acceptable Rate Case:

<TABLE>
<CAPTION>
====================================================================================================================
                               Category 1       Category 2        Category 3        Category 4        Category 5
                               ----------       -----------       -----------       -----------       -----------

                             A- or higher    BBB+ or higher     BBB or higher     BBB- or higher    BB+ or lower
                             by S&P and A3   by S&P and Baa1    by S&P and Baa2   by S&P and Baa3   by S&P or Ba1
                             or higher by    or higher by       or higher by      or higher by      or lower by
                             Moody's         Moody's            Moody's           Moody's           Moody's
====================================================================================================================
<S>                              <C>              <C>                <C>               <C>               <C>
Facility Fee                     0.10%            0.125%             0.15%             0.20%             0.30%
--------------------------------------------------------------------------------------------------------------------
Eurodollar Spread                0.525%           0.75%              0.85%             0.925%            1.125%
--------------------------------------------------------------------------------------------------------------------
ABR Spread                          0%               0%                 0%                0%             0.125%
--------------------------------------------------------------------------------------------------------------------
</TABLE>

Notwithstanding the foregoing, in the event that, and at all times during which,
the aggregate principal amount of the Loans outstanding hereunder exceeds 50% of
the total Commitments, (i) each of the foregoing Eurodollar Spreads shall be
increased by (A) in the case of Category 1, 0.10% per annum, (B) in the case of
each of Category 2, Category 3 and Category 4, 0.125% per annum, and (C) in the
case of Category 5, 0.25% per annum, and (ii) the foregoing ABR Spreads shall be
increased by (A) in the case of Category 4, 0.05% per annum, and (B) in the case
of Category 5, 0.25% per annum.

For purposes of the foregoing pricing tables, (1) if either Moody's or S&P shall
not have in effect a rating for the Index Debt of Borrower (other than by reason
of the circumstances referred

                                      -3-

<PAGE>

to in the last sentence of this definition), then such rating agency shall be
deemed to have established a rating in Category 5, (2) if the ratings
established or deemed to have been established by Moody's and S&P for the Index
Debt of Borrower shall be changed (other than as a result of a change in the
rating system of Moody's or S&P), such change shall be effective as of two
Business Days after it is first announced by the applicable rating agency, (3)
if more than one Category is applicable at any one time, the Applicable Rate
shall be based on the applicable Category having the lowest number (i.e.,
Category 1 is lower than Category 2), and (4) upon the occurrence of an
Acceptable Rate Case and at all times thereafter, the pricing table set forth
above under the caption "Upon and After the Occurrence of an Acceptable Rate
Case" shall be effective. Each change in the Applicable Rate (including any
change based on the occurrence of an Acceptable Rate Case) shall apply during
the period commencing on the effective date of such change and ending on the
date immediately preceding the effective date of the next such change. If the
rating system of Moody's or S&P shall change, or if either such rating agency
shall cease to be in the business of rating corporate debt obligations, the
Borrower and the Lenders shall negotiate in good faith to amend this definition
to reflect such changed rating system or the unavailability of ratings from
such rating agency and, pending the effectiveness of any such amendment, the
Applicable Rate shall be determined by reference to the rating most recently in
effect prior to such change or cessation.

                  "Assignment and Acceptance" means an assignment and acceptance
                   -------------------------
entered into by a Lender and an assignee (with the consent of any party whose
consent is required by Section 9.12), and accepted by the Administrative Agent,
in the form of Exhibit A or any other form approved by the Administrative Agent.

                  "Availability Period" means the period from and including the
                   -------------------
Effective Date to but excluding the Revolving Termination Date.

                  "Bankruptcy Code" means Title 11 of the United States Code
                   ---------------
entitled "Bankruptcy," as now or hereafter in effect, or any successor thereto.

                  "Board" means the Board of Governors of the Federal Reserve
                   -----
System of the United  States of America.

                  "Borrower" means Nevada Power Company, a Nevada corporation.
                   --------

                  "Borrowing" means Loans of the same Type, made, converted or
                   ---------
continued on the same date and, in the case of Eurodollar Loans, as to which a
single Interest Period is in effect.

                  "Borrowing Request" means a request by the Borrower for a
                   -----------------
Borrowing made in accordance with Section 2.03.

                  "Business Day" means any day that is not a Saturday, Sunday or
                   ------------
other day on which commercial banks in Los Angeles, California are authorized or
required by Law to remain closed; provided that, when used in connection with a
                                  --------
Eurodollar Loan, the term "Business Day" shall also exclude any day on which
banks are not open for dealings in dollar deposits in the London interbank
market.

                                      -4-

<PAGE>

                  "Capital Lease Obligations" of any Person means all
                   -------------------------
obligations of such Person to pay rent or other amounts under a lease of (or
other agreement conveying the right to use) Property to the extent such
obligations are required to be classified and accounted for as a capital lease
on a balance sheet of such Person under GAAP (including Statement of Financial
Accounting Standards No. 13 of the Financial Accounting Standards Board), and,
for purposes of this Agreement, the amount of such obligations shall be the
capitalized amount thereof, determined in accordance with GAAP (including such
Statement No. 13).

                  "Change in Control" means (a) the failure of Sierra Pacific
                   -----------------
Resources to own, legally and beneficially, 100% of the aggregate ordinary
voting power represented by the issued and outstanding capital stock of the
Borrower; (b) the acquisition of ownership, directly or indirectly, beneficially
or of record, by any Person or group (within the meaning of the Securities
Exchange Act of 1934 and the rules of the Securities and Exchange Commission
thereunder as in effect on the date hereof) of shares representing more than 20%
of the aggregate ordinary voting power represented by the issued and outstanding
capital stock of Sierra Pacific Resources; or (c) for any period of 12
consecutive calendar months, a majority of the Board of Directors of Sierra
Pacific Resources shall no longer be composed of individuals (i) who were
members of said Board on the first day of such period, (ii) whose election or
nomination to said Board was approved by individuals referred to in clause (i)
above constituting at the time of such election or nomination at least a
majority of said Board or (iii) whose election or nomination to said Board was
approved by individuals referred to in clauses (i) and (ii) above constituting
at the time of such election or nomination at least a majority of said Board.

                  "Change in Law" means (a) the adoption of any Law after the
                   -------------
date of this Agreement, (b) any change in any Law or in the interpretation or
application thereof by any Governmental Authority after the date of this
Agreement or (c) compliance by any Lender (or, for purposes of Section 2.12(b),
by any lending office of such Lender or by such Lender's Parent, if any) with
any request, guideline or directive (whether or not having the force of Law) of
any Governmental Authority made or issued after the date of this Agreement.

                  "Class", when used in reference to any Loan or Borrowing,
                   -----
refers to such Loan, or the Loans comprising such Borrowing, as Revolving Loans.

                  "Code" means the Internal Revenue Code of 1986 and the
                   ----
regulations promulgated and rulings issued thereunder. Section references to the
Code are to the Code, as in effect at the date of this Agreement and any
subsequent provisions of the Code, amendatory thereof, supplemental thereto or
substituted therefor.

                  "Co-Documentation Agents" means Bank One, NA, BNP Paribas and
                   -----------------------
Mellon Bank, N.A.

                  "Co-Lead Arrangers" means Union Bank of California, N.A. and
                   -----------------
Wells Fargo Bank, N.A.

                  "Commitment" means, with respect to each Lender, the
                   ----------
commitment of such Lender to make Revolving Loans hereunder, expressed as an
amount representing the maximum aggregate amount of such Lender's Revolving
Credit Exposure hereunder, as such commitment

                                      -5-

<PAGE>

may be (a) terminated or reduced from time to time pursuant to Section 2.06 or
7.02 and (b) reduced or increased from time to time pursuant to assignments by
or to such Lender pursuant to Section 9.12. The initial amount of each Lender's
Commitment is set forth on Schedule I or in the Assignment and Acceptance
pursuant to which such Lender shall have assumed its Commitment, as applicable.
The aggregate amount of the Lenders' Commitments shall in no event exceed
$150,000,000.

                  "Consolidated EBITDA" means, for any period, Consolidated Net
                   -------------------
Income for such period, plus, to the extent deducted in computing such
Consolidated Net Income, (a) the sum of (i) all Federal, state, local and
foreign taxes (whether paid or deferred) of the Borrower and its Subsidiaries
during such period, (ii) Consolidated Interest Expense during such period, and
(iii) depreciation, depletion, amortization of intangibles and other non-cash
charges or non-cash losses of the Borrower and its Subsidiaries during such
period, and minus, to the extent added in computing such Consolidated Net
Income, (b) the sum of (i) any interest income of the Borrower and its
Subsidiaries during such period and (ii) any non-cash income or non-cash gains
of the Borrower and its Subsidiaries during such period, all as determined on a
consolidated basis in accordance with GAAP.

                  "Consolidated Interest Coverage Ratio" means, for any period,
                   ------------------------------------
the ratio of (i) Consolidated EBITDA for such period to (ii) Consolidated
Interest Expense for such period.

                  "Consolidated Interest Expense" means, for any period, the
                   -----------------------------
gross interest expense of the Borrower and its Subsidiaries for such period
determined on a consolidated basis in accordance with GAAP, including (a) the
amortization of debt discounts, (b) the amortization of all fees (including fees
with respect to Hedging Agreements) payable in connection with the incurrence of
Indebtedness to the extent included in interest expense in accordance with GAAP
and (c) the portion of any payments or accruals with respect to Capital Lease
Obligations of the Borrower and its Subsidiaries that are allocable to interest
expense in accordance with GAAP. For purposes of the foregoing, gross interest
expense shall be determined after giving effect to any net payments made or
received by the Borrower or any of its Subsidiaries with respect to Hedging
Agreements.

                  "Consolidated Net Income" means, for any period, the net
                   -----------------------
income or loss of the Borrower and its Subsidiaries for such period determined
on a consolidated basis in accordance with GAAP; provided that there shall be
                                                 --------
excluded (a) the income of any Person in which any other Person (other than the
Borrower or any of its Wholly-Owned Subsidiaries or any director holding
qualifying shares in accordance with applicable law) has a joint interest,
except to the extent of the amount of dividends or other distributions actually
paid to the Borrower or any of its Wholly-Owned Subsidiaries by such Person
during such period, (b) the income (or loss) of any Person accrued prior to the
date it becomes a Subsidiary of the Borrower or is merged into or consolidated
with the Borrower or any of its Subsidiaries or the date such Person's assets
are acquired by the Borrower or any of its Subsidiaries, (c) the income of any
Subsidiary of the Borrower to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary of such income is not at
the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to such Subsidiary and (d) any after-tax gains or losses attributable
to sales of assets out of the ordinary course of business.

                                      -6-

<PAGE>

                  "Control" of a Person (including, with its correlative
                   -------
meanings, "Controlled by" and "under common Control with") means possession,
directly or indirectly, of the power to direct or cause the direction of
management or policies (whether through ownership of securities or partnership
or other ownership interests, by contract or otherwise) of such Person.

                  "Default" means any event, act or condition which upon notice,
                   -------
lapse of time or both would, unless cured or waived, become an Event of Default.

                  "Default Interest" has the meaning assigned to such term in
                   ----------------
Section 2.10(c).

                  "Dollars" or "$" refers to freely transferable lawful money of
                   -------      -
the United States of America.

                  "Effective Date" means the date on which the conditions
                   --------------
specified in Section 4.01 are satisfied (or waived in accordance with Section
9.01).

                  "Environmental Claims" means any and all administrative,
                   --------------------
regulatory or judicial actions, suits, demands, demand letters, directives,
claims, liens, notices of noncompliance or violation, investigations or
proceedings relating in any way to any Environmental Law or any permit issued,
or any approval given, under any such Environmental Law (hereafter, "Claims"),
                                                                     ------
including, without limitation, (a) any and all Claims by governmental or
regulatory authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental Law, and (b)
any and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief in connection
with alleged injury or threat of injury to health, safety or the environment due
to the presence of Hazardous Materials.

                  "Environmental Law" means any Federal,  state, foreign or
                   -----------------
local statute,  Law, rule,  regulation, ordinance,  code,  guideline,  written
policy and rule of common law now or hereafter in effect and in each case as
amended, and any judicial or administrative interpretation thereof, including
any judicial or administrative order, consent decree or judgment, relating to
the environment, employee health and safety or Hazardous Materials, including,
without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C.[sect.] 9601 et seq.; the Resource Conservation and
                                    -- ----
Recovery Act of 1976, 42 U.S.C.[sect.] 6901 et seq.; theFederal Water Pollution
                                            -- ----
Control Act, 33 U.S.C.[sect.] 1251 et seq.; the Toxic Substances Control Act, 15
                                   -- ---
U.S.C.[sect.] 2601 et seq.; the Clean Air Act, 42 U.S.C.[sect.] 7401 et seq.;
                   -- ----                                           -- ----
the Safe Drinking Water Act, 42 U.S.C.[sect.] 3803 et seq.; the Oil Pollution
                                                   -- ----
Act of 1990, 33 U.S.C.[sect.] 2701 et seq.; the Emergency  Planning and the
                                   -- ----
Community  Right-to-Know  Act of 1986, 42 U.S.C.[sect.] 11001 et seq.; the
                                                              -- ----
Hazardous Material Transportation Act, 49 U.S.C.[sect.]1801 et seq.; and the
                                                            -- ----
Occupational  Safety and Health Act, 29 U.S.C.[sect.] 651 et seq.; and any state
                                                          -- ----
and local or foreign counterparts or equivalents, in each case as amended from
time to time.

                  "ERISA" means the Employee Retirement Income Security Act of
                   -----
1974 and the regulations promulgated and rulings issued thereunder. Section
references to ERISA are to ERISA, as in effect at the date of this Agreement,
and to any subsequent provisions of ERISA, amendatory thereof, supplemental
thereto or substituted therefor.

                                      -7-

<PAGE>

                  "ERISA Affiliate" means any corporation or trade or business
                   ---------------
that is a member of any group of organizations described in Section 414(b) or
(c) of the Code of which the Borrower is a member.

                  "Eurodollar", when used in reference to any Loan or Borrowing,
                   ----------
refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Adjusted LIBO Rate.

                  "Event of Default" has the meaning assigned to such term in
                   ----------------
Section 7.01.

                  "Excluded Taxes" means, with respect to the Administrative
                   --------------
Agent, any Lender or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the Laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender (other than an assignee pursuant to a request by the
Borrower under Section 2.16(b)), any withholding tax that is imposed on amounts
payable to such Foreign Lender at the time such Foreign Lender becomes a party
to this Agreement or is attributable to such Foreign Lender's failure or
inability to comply with Section 2.14(e), except to the extent that such Foreign
Lender's assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such withholding tax
pursuant to Section 2.14(a).

                  "Existing Credit Agreements" means (a) the Credit Agreement,
                   --------------------------
dated as of August 1, 2001, among the Borrower, Mellon Bank, N.A., as
Administrative Agent and Arranger, BNP Paribas, First Union National Bank and
Wells Fargo Bank, N.A., as Syndication Agents, and the lenders party thereto
from time to time and (b) the Credit Agreement, dated as of June 24, 1999, among
the Borrower, Mellon Bank, N.A., as Administrative Agent and Arranger, First
Union National Bank and Wells Fargo Bank, N.A., as Syndication Agents, and the
lenders party thereto from time to time, in each case as amended through the
date hereof.

                  "Existing Indebtedness" has the meaning assigned to such term
                   ---------------------
in Section 3.22.

                  "Extension Request" has the meaning assigned to such term in
                   -----------------
Section 2.06(e).

                  "Extension Request Notice" has the meaning assigned to such
                   ------------------------
term in Section 2.06(e).

                  "Extension Request Period" has the meaning assigned to such
                   ------------------------
term in Section 2.06(e).

                  "Federal Funds Effective Rate" means, for any day, the
                   ----------------------------
weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the
rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the average
(rounded upwards, if

                                      -8-

<PAGE>

necessary, to the next 1/100 of 1%) of the quotations for such day for such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by it.

                  "Fee Letter" has the meaning assigned to such term in Section
                   ----------
2.09(b).

                  "First Mortgage Bonds" means obligations issued from time to
                   --------------------
time under, and secured by, the First Mortgage Indenture.

                  "First Mortgage Indenture" means the Indenture of Mortgage,
                   ------------------------
dated as of October 1, 1953, from the Borrower to Bankers Trust Company
(successor to First Interstate Bank of Nevada, N.A., formerly First National
Bank of Nevada, Reno, Nevada), as Trustee, as modified, amended or
supplemented at any time or from time to time by supplemental indentures.

                  "Foreign Lender" means any Lender that is organized under the
                   --------------
Laws of a jurisdiction other than the United States of America, each State
thereof and the District of Columbia.

                  "Foreign Pension Plan" means any plan, fund (including,
                   --------------------
without limitation, any superannuation fund) or other similar program
established or maintained outside the United States of America by the Borrower
or any one or more of its Subsidiaries primarily for the benefit of employees of
the Borrower or such Subsidiaries residing outside the United States of America,
which plan, fund or other similar program provides, or results in, retirement
income, a deferral of income in contemplation of retirement or payments to be
made upon termination of employment, and which plan is not subject to ERISA or
the Code.

                  "GAAP" means generally accepted accounting principles in the
                   ----
United States of America applied in a consistent manner.

                  "General and Refunding Mortgage Bonds" means obligations
                   ------------------------------------
issued from time to time under, and secured by, the General and Refunding
Mortgage Indenture.

                  "General and Refunding Mortgage Indenture" means the General
                   ----------------------------------------
and Refunding Mortgage Indenture, dated as of May 1, 2001, between the Borrower
and The Bank of New York, as trustee, as the same may be amended, modified or
supplemented from time to time.

                  "Governmental Action" means any authorization, approval,
                   -------------------
order, decree, ruling or other action by, or notice to or filing with, any
Governmental Authority.

                  "Governmental Authority" means the government of the United
                   ----------------------
States of America, any other nation or any political subdivision thereof,
whether state or local, and any agency, authority, bureau, instrumentality,
regulatory body, court, tribunal, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or
functions of or pertaining to government.

                  "Hazardous Materials" means (a) any petroleum or petroleum
                   -------------------
products, radioactive materials, asbestos in any form that is friable, urea
formaldehyde foam insulation,

                                      -9-

<PAGE>

transformers or other equipment that contain dielectric fluid containing levels
of polychlorinated biphenyls, and radon gas; (b) any chemicals, materials or
substances defined as or included in the definition of "hazardous substances,"
"hazardous waste," "hazardous materials," "extremely hazardous substances,"
"restricted hazardous waste," "toxic substances," "toxic pollutants,"
"contaminants," or "pollutants," or words of similar import, under any
applicable Environmental Law; and (c) any other chemical, material or
substance, the Release of which is prohibited, limited or regulated by any
Governmental Authority.

                  "Hedging Agreements" means interest rate swap, cap or collar
                   ------------------
agreements, interest rate future or option contracts, and other similar
agreements designed to protect against fluctuations in interest rates.

                  "Indebtedness" of any Person means, (a) obligations created,
                   ------------
issued or incurred by such Person for borrowed money (whether by loan, the
issuance and sale of debt securities or the sale of Property to another Person
subject to an understanding or agreement, contingent or otherwise, to repurchase
such Property from such Person); (b) obligations of such Person to pay the
deferred purchase or acquisition price of Property or services, other than trade
accounts payable (other than for borrowed money) arising, and accrued expenses
incurred, in the ordinary course of business; (c) Indebtedness of others secured
by a Lien on the Property of such Person, whether or not the respective
indebtedness so secured has been assumed by such Person; (d) obligations of such
Person in respect of letters of credit or similar instruments issued or accepted
by banks and other financial institutions for the account of such Person; (e)
Capital Lease Obligations of such Person; and (f) any guarantee or other
arrangement by which such Person guarantees or is otherwise liable for the
Indebtedness of others; provided, however, that "Indebtedness" shall not include
                        --------  -------
Secured Nonrecourse Obligations.

                  "Indemnified Parties" means each Agent, the Lenders, their
                   -------------------
respective Affiliates, and the directors, officers, employees, attorneys and
agents of each of the foregoing.

                  "Indemnified Taxes" means all Taxes other than Excluded Taxes.
                   -----------------

                  "Index Debt of Borrower" means the senior, unsecured,
                   ----------------------
long-term indebtedness for borrowed money of the Borrower that is not guaranteed
by any other Person or subject to any credit enhancement.

                  "Interest Election Request" means a request by the Borrower to
                   -------------------------
convert or continue a Borrowing in accordance with Section 2.05.

                  "Interest Payment Date" means (a) with respect to any ABR
                   ---------------------
Loan, each Quarterly Date, and (b) with respect to any Eurodollar Loan, the last
day of the Interest Period applicable to the Borrowing of which such Loan is a
part and, in the case of a Eurodollar Borrowing with an Interest Period of more
than three months' duration, each day prior to the last day of such Interest
Period that occurs at intervals of three months' duration after the first day of
such Interest Period.

                  "Interest Period" means, with respect to any Eurodollar
                   ---------------
Borrowing, the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months thereafter, as the Borrower may elect;

                                     -10-

<PAGE>

provided, that (a) if any Interest Period would end on a day other than a
--------  ----
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (b) any Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period.
For purposes hereof, the date of a Borrowing initially shall be the date on
which such Borrowing is made and, thereafter, shall be the effective date of
the most recent conversion or continuation of such Borrowing.

                  "Investment" means, when used in connection with any Person,
                   ----------
any investment by or of that Person, whether by means of purchase or other
acquisition of stock or other securities of any other Person or by means of a
loan, advance creating a debt, capital contribution, guaranty or other debt or
equity participation or interest in any other Person, including any partnership
                                                      ---------
and joint venture interests of such Person but excluding any Wholly-Owned
                                               ---------
Subsidiary of such Person. The amount of any Investment shall be the amount
actually invested (minus any return of capital with respect to such Investment
                   -----
which has actually been received in cash or has been converted into cash),
without adjustment for subsequent increases or decreases in the value of such
Investment.

                  "Law" shall mean any law (including common law), constitution,
                   ---
statute, treaty, convention, regulation, rule, ordinance, order, injunction,
writ, decree or award of any Governmental Authority.

                  "Lenders" means the Persons listed on Schedule I and any other
                   -------
Person that shall have become a party hereto pursuant to an Assignment and
Acceptance.

                  "LIBO Rate" means, with respect to any Eurodollar Borrowing
                   ---------
for any Interest Period, the average of the offered rates for Dollar deposits
for the applicable Interest Period which appear on the Telerate Page 3750,
British Bankers Association Interest Settlement Rates, with maturities
comparable to the Interest Period to be applicable to such Eurodollar Loan,
determined as of 10:00 A.M. (New York, New York time) on the date which is two
Business Days prior to the commencement of such Interest Period.

                  "Lien" means, with respect to any Property, any mortgage,
                   ----
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such Property. For purposes of this Agreement, a Person shall be deemed to own
subject to a Lien any Property that it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement (other than an operating lease)
relating to such Property.

                  "Loan Documents" means this Agreement, each Borrowing Request,
                   --------------
each Interest Election Request, each Note, the Fee Letter and any documents or
instruments executed and delivered by the Borrower in connection with the
issuance of General and Refunding Mortgage Bonds pursuant to Section 6.09(b).

                  "Loans" means Revolving Loans.
                   -----

                                     -11-

<PAGE>

                  "Material Adverse Effect" means (a) a material adverse effect
                   -----------------------
on (i) the Property, business, operations, financial condition, prospects,
liabilities or capitalization of the Borrower and its Subsidiaries taken as a
whole, (ii) the ability of the Borrower to perform its obligations hereunder,
(iii) the validity or enforceability of this Agreement, (iv) the rights and
remedies of the Lenders and the Administrative Agent hereunder or (v) the timely
payment of the principal of or interest on the Loans or other amounts payable in
connection therewith and (b) a material adverse change in the facts and
information regarding the Borrower and its Subsidiaries submitted in writing to
the Administrative Agent and/or the Lenders by the Borrower.

                  "Moody's" means Moody's Investors Service, Inc. and its
                   -------
successors and assigns; provided that if such corporation (or its successors and
                        --------
assigns) shall for any reason no longer perform the functions of a securities
rating agency, "Moody's" shall be deemed to refer to any other nationally
recognized securities rating agency approved for purposes hereof by the Required
Lenders and the Borrower.

                  "Multiemployer Plan" means a multiemployer plan defined as
                   ------------------
such in Section 3(37) of ERISA to which contributions have been made by the
Borrower or any ERISA Affiliate and which is covered by Title IV of ERISA.

                  "Note" has the meaning assigned to such term in Section
                   ----
2.07(f).

                  "Obligations" means all Indebtedness, obligations and
                   -----------
liabilities of the Borrower to any Lender or any Agent from time to time arising
under or in connection with or related to or evidenced by or secured by this
Agreement or any other Loan Document, and all extensions, renewals or
refinancings thereof, whether such Indebtedness, obligations or liabilities are
direct or indirect, otherwise secured or unsecured, joint or several, absolute
or contingent, due or to become due, whether for payment or performance, now
existing or hereafter arising. Without limitation of the foregoing, such
Indebtedness, obligations and liabilities shall include the principal amount of
all Loans, all interest, fees, indemnities or expenses under or in connection
with this Agreement or any other Loan Document, and all extensions, renewals and
refinancings thereof, whether or not such Loans were made in compliance with the
terms and conditions of this Agreement or in excess of the obligation of the
Lenders to lend. Obligations shall remain obligations notwithstanding any
assignment or transfer or any subsequent assignment or transfer of any of the
Obligations or any interest therein.

                  "Other Taxes" means any and all present or future stamp or
                   -----------
documentary taxes or any other excise or Property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement.

                  "Parent" means any Person that Controls a Lender.
                   ------

                  "Participant" has the meaning assigned to such term in Section
                   -----------
9.12(b).

                  "PBGC" means the Pension Benefit Guaranty Corporation or any
                   ----
entity succeeding to any or all of its functions under ERISA.

                  "Permitted Liens" has the meaning assigned to such term in
                   ---------------
Section 6.02.

                                     -12-

<PAGE>

                  "Person" means any natural person, corporation, limited
                   ------
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.

                  "Plan" means an employee benefit or other plan established or
                   ----
maintained by the Borrower or any ERISA Affiliate and that is covered by Title
IV of ERISA, other than a Multiemployer Plan.

                  "Prime Rate" means the rate of interest per annum publicly
                   ----------
announced from time to time by Union Bank of California, N.A. in Los Angeles,
California, as the Union Bank Reference Rate, the Prime Rate to change when and
as such Reference Rate changes. The Prime Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer.
Union Bank of California, N.A. may make commercial loans or other loans at rates
of interest at, above or below the Prime Rate.

                  "Principal Office" means the principal office of Union Bank of
                   ----------------
California, N.A., located on the date hereof at 445 South Figueroa Street, Los
Angeles, California 90071.

                  "Projections" means forecasted (a) balance sheets, (b) income
                   -----------
statements, and (c) cash flow statements, in each case, for the Borrower and its
Subsidiaries, on a consolidated basis, and prepared on a consistent basis with
the Borrower's historical financial statements, together with appropriate
supporting details and a statement of underlying assumptions.

                  "Property" means any right or interest in or to property of
                   --------
any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.

                  "Purchasing Lender" has the meaning assigned to such term in
                   -----------------
Section 9.12(c).

                  "Quarterly Dates" means the last day of March, June, September
                   ---------------
and December in each year, the first of which shall be the first such day after
the date hereof; provided that if any such day is not a Business Day, then such
                 --------
Quarterly Date shall be the next succeeding Business Day (unless such succeeding
Business Day falls in a subsequent calendar month, in which event such Quarterly
Date shall be the next preceding Business Day).

                  "Register" has the meaning assigned to such term in Section
                   --------
9.12(d).

                  "Related Parties" means, with respect to any specified Person,
                   ---------------
such Person's Affiliates and the respective directors, officers, employees,
agents and advisors of such Person and such Person's Affiliates.

                  "Release" means the disposing, discharging, injecting,
                   -------
spilling, pumping, leaking, leaching, dumping, emitting, escaping, emptying,
pouring or migrating, into or upon any land or water or air, or otherwise
entering into the environment.

                  "Reportable Event" means an event described in Section 4043(c)
                   ----------------
of ERISA with respect to a Plan that is subject to Title IV of ERISA other than
those events as to which the 30-day notice period is waived under subsection
..22, .23, .25, .27 or .28 of PBGC Regulation Section 4043 (provided that a
                                                           --------
failure to meet the minimum funding standard of Section 412 of the Code or
Section 302 of ERISA, including, without limitation, the failure to make on or

                                     -13-

<PAGE>

before its due date a required installment under Section 412(m) of the Code or
Section 302(e) of ERISA, shall be a reportable event regardless of the issuance
of any waivers in accordance with Section 412(d) of the Code).

                  "Required Lenders" means (a) so long as the Commitments remain
                   ----------------
in effect, Lenders having Commitments representing 51% or more of the sum of the
total Commitments at such time, or (b) if the Commitments have terminated,
Lenders holding 51% or more of the aggregate principal amount of the Loans
outstanding at such time.

                  "Responsible Officer" means the Treasurer, the Assistant
                   -------------------
Treasurer, the Chief Financial Officer or the Controller.

                  "Revolving Credit Exposure" means, with respect to any Lender
                   -------------------------
at any time, the aggregate outstanding principal amount of such Lender's
Revolving Loans at such time.

                  "Revolving Loan" has the meaning assigned to such term in
                   --------------
Section 2.01(a).

                  "Revolving Termination Date" means the earlier to occur of (a)
                   --------------------------
November 28, 2002, or such date after November 28, 2002 to which the Commitments
are extended in accordance with Section 2.06(e) and (b) the date the Obligations
and Commitments under this Agreement terminate, whether by prepayment,
cancellation, acceleration or otherwise.

                  "Secured Nonrecourse Obligations" means and includes (a)
                   -------------------------------
secured obligations of the Borrower taken on a consolidated basis where recourse
of the payee of such obligations is expressly limited to an assigned lease or
loan receivable and the Property related thereto and (b) liabilities of the
Borrower taken on a consolidated basis to manufacturers of leased equipment
where such liabilities are payable solely out of revenues derived from the
leasing or sale of such equipment.

                  "Sierra Pacific Resources" means Sierra Pacific Resources, a
                   ------------------------
Nevada corporation.

                  "Shareholders' Equity" means, as of any date of determination,
                   --------------------
the amount which is shown as "shareholders' equity" (which shall include both
common and preferred equity) in the consolidated balance sheet of the Borrower
at such date.

                  "Sole Bookrunner" means Union Bank of California, N.A.
                   ---------------

                  "SPPC" means NEVADA Pawer Company, a Nevada corportaion.
                   ----

                  "SPR Credit  Agreement" means the Credit Agreement, dated as
                   ---------------------
of November 30, 2001, among Sierra Pacific Resources, Union Bank of California,
N.A., as Administrative Agent and Sole Bookrunner, Wells Fargo Bank, N.A., as
Syndication Agent, Bank One, NA, BNP Paribas and Mellon Bank, N.A., as Co-
Documentation Agents, thelenders party thereto from time to time, and Union Bank
of California, N.A. and Wells Fargo Bank, N.A., as Co-Lead Arrangers, as the
same may be amended, supplemented or otherwise modified from time to time.

                                     -14-

<PAGE>

                  "S&P" means Standard & Poor's Ratings Group, a division of The
                   ---
McGraw Hill Companies, Inc., and its successors and assigns; provided that if
                                                             --------
such corporation (or its successors and assigns) shall for any reason no longer
perform the functions of a securities rating agency, "S&P" shall be deemed to
refer to any other nationally recognized securities rating agency approved for
purposes hereof by the Required Lenders and the Borrower.

                  "Statutory Reserve Rate" means a fraction (expressed as a
                   ----------------------
decimal), the numerator of which is the number one and the denominator of which
is the number one minus the aggregate of the maximum reserve percentages
(including any marginal, special, emergency or supplemental reserves) expressed
as a decimal established by the Board to which the Administrative Agent is
subject for eurocurrency funding (currently referred to as "Eurocurrency
liabilities" in Regulation D of the Board). Such reserve percentages shall
include those imposed pursuant to such Regulation D. Eurodollar Loans shall be
deemed to constitute eurocurrency funding and to be subject to such statutory
reserve rates without benefit of or credit for proration, exemptions or offsets
that may be available from time to time to any Lender under such Regulation D or
any comparable regulation. The Statutory Reserve Rate shall be adjusted
automatically on and as of the effective date of any change in any reserve
percentage.

                  "Subsidiary" shall mean, as to any Person, (i) any corporation
                   ----------
more than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person and (ii) any partnership, limited liability
company, association, joint venture or other entity in which such Person and/or
one or more Subsidiaries of such Person has more than a 50% equity interest at
the time.

                  "Substitute Lender" has the meaning assigned to such term in
                   -----------------
Section 2.06(f).

                  "Syndication Agent" means Wells Fargo Bank, N.A.
                   -----------------

                  "Taxes" means any and all present or future taxes, levies,
                   -----
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.

                  "Total Indebtedness" means, as of any date of determination,
                   ------------------
the sum of all Indebtedness of the Borrower and its consolidated Subsidiaries as
of such date.

                  "Triggering Event" has the meaning assigned to such term in
                   ----------------
Section 6.09(b).

                  "Type", when used in reference to any Loan or Borrowing,
                   ----
refers to whether the rate of interest on such Loan, or on the Loans comprising
such Borrowing, is determined by reference to the Adjusted LIBO Rate or the
Alternate Base Rate.

                  "Unfunded Current Liability" of any Plan means the amount, if
                   --------------------------
any, by which the value of the accumulated plan benefits under the Plan
determined on a plan termination basis in accordance with actuarial assumptions
at such time consistent with those prescribed by the PBGC for purposes of
Section 4044 of ERISA, exceeds the fair market value of all plan assets

                                     -15-

<PAGE>

allocable to such liabilities under Title IV of ERISA (excluding any accrued but
unpaid contributions).

                  "Wholly-Owned Subsidiary" shall mean, as to any Person, (i)
                   -----------------------
any corporation 100% of whose stock of any class or classes having by the terms
thereof ordinary voting power to elect a majority of the directors of such
corporation (irrespective of whether or not at the time stock of any class or
classes of such corporation shall have or might have voting power by reason of
the happening of any contingency) is at the time owned by such Person and/or one
or more Subsidiaries of such Person and (ii) any partnership, limited liability
company, association, joint venture or other entity in which such Person and/or
one or more Subsidiaries of such Person has a 100% equity interest at the time.

                  SECTION 1.02 Classification of Loans and Borrowings.
                               --------------------------------------

                  For  purposes of this  Agreement,  Loans may be  classified
and referred to by Class (e.g., a "Revolving Loan") or by Type (e.g., a
"Eurodollar Loan" or an "ABR Loan") or by Class and Type (e.g., a "Eurodollar
Revolving Loan").  Borrowings also may be classified and referred to by Class
(e.g., a "Revolving Borrowing") or by Type (e.g., a "Eurodollar Borrowing") or
by Class and Type (e.g., a "Eurodollar Revolving Borrowing").

                  SECTION 1.03  Terms Generally.
                                ---------------

                  The definitions of terms herein shall apply equally to the
singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". The word "will" shall be
construed to have the same meaning and effect as the word "shall". Unless the
context requires otherwise (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof and (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement.

                  SECTION 1.04 Accounting Terms; GAAP.
                               ----------------------

                  Except as otherwise expressly provided herein, all terms of
an accounting or financial nature shall be construed in accordance with GAAP,
as in effect from time to time.

                                     -16-

<PAGE>

                                   ARTICLE II
                                   THE CREDITS

                  SECTION 2.01  The Commitments.
                                ---------------

                  Subject to the terms and conditions set forth herein, each
Lender agrees to make loans (each such loan, a "Revolving Loan") to the Borrower
                                                --------------
from time to time on any Business Day during the Availability Period in an
aggregate principal amount that will not result in (i) such Lender's Revolving
Credit Exposure (after giving effect to such Revolving Loans) exceeding such
Lender's Commitment or (ii) the sum of the Revolving Credit Exposures of all
Lenders exceeding the total Commitments. Within the foregoing limits and subject
to the terms and conditions set forth herein, the Borrower may borrow, prepay
and reborrow Revolving Loans.

                  SECTION 2.02  Loans and Borrowings.
                                --------------------

                  (a) Obligations of Lenders. Each Revolving Loan shall be made
                      ----------------------
as part of a Borrowing consisting of Loans of the same Type made by the Lenders
ratably in accordance with their respective Commitments. The failure of any
Lender to make any Loan required to be made by it shall not relieve any other
Lender of its obligations hereunder. The Commitments of the Lenders are several
and no Lender shall be responsible for any other Lender's failure to make Loans
as required.

                  (b) Type of Loans. Subject to Section 2.11, each Borrowing
                      -------------
shall be comprised entirely of ABR Loans or Eurodollar Loans. Each Lender may,
at its option, make any Eurodollar Loan by causing any domestic or foreign
branch or Affiliate of such Lender to make such Loan; provided that any exercise
                                                      --------
of such option shall not affect the obligation of the Borrower to repay such
Loan in accordance with the terms of this Agreement.

                  (c) Minimum Amounts; Limitation on Number of Borrowings. Each
                      ---------------------------------------------------
Revolving Borrowing (whether an ABR Borrowing or a Eurodollar Borrowing) shall
be in an aggregate amount equal to $5,000,000 or a multiple of $1,000,000 in
excess thereof; provided that an ABR Borrowing may be made in an aggregate
                --------
amount that is equal to the entire unused balance of the total Commitments. The
Borrower may thereafter, upon irrevocable notice to the Administrative Agent in
accordance with Section 2.05(b), (i) elect, as of any Business Day, in the case
of ABR Loans, to convert any such ABR Loans or any part thereof, in an aggregate
amount equal to $5,000,000 or a multiple of $1,000,000 in excess thereof, into
Eurodollar Loans, and (ii) elect, as of the last day of the applicable Interest
Period, to continue any Eurodollar Loans having Interest Periods expiring on
such day or any part thereof in an aggregate amount of $5,000,000 or a multiple
of $1,000,000 in excess thereof; provided that, if at any time the aggregate
                                 --------
amount of Eurodollar Loans in respect of any Borrowing is reduced by payment,
prepayment or conversion of part thereof to be less than $5,000,000, such
Eurodollar Loans shall automatically convert into ABR Loans. Borrowings of more
than one Type may be outstanding at the same time; provided that there shall not
                                                   --------
at any time be more than a total of five Eurodollar Borrowings outstanding.

                                     -17-

<PAGE>

                  (d) Maximum Duration of Interest Periods. Notwithstanding any
                      ------------------------------------
other provision of this Agreement, the Borrower shall not be entitled to
request, or to elect to convert or continue, any Eurodollar Borrowing if the
Interest Period requested with respect thereto would end after the Revolving
Termination Date.

                  SECTION 2.03  Requests for Revolving Borrowings.
                                ---------------------------------

                  To request a Revolving Borrowing, the Borrower shall notify
the Administrative Agent of such request by telephone (a) in the case of a
Eurodollar Revolving Borrowing, not later than 12:00 noon, New York, New York
time, three Business Days before the date of the proposed Borrowing, or (b) in
the case of an ABR Borrowing, not later than 12:00 noon, New York, New York
time, one Business Day before the date of the proposed Borrowing. Each such
telephonic Borrowing Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Borrowing Request in the form attached hereto as Exhibit B and signed by the
Borrower. Each such telephonic and written Borrowing Request shall specify the
following information in compliance with Section 2.02:

                           (i)    the aggregate amount of the requested
         Borrowing;

                           (ii)   the date of such Borrowing, which shall be a
         Business Day;

                          (iii)   whether such Borrowing is to be an ABR
         Borrowing or a Eurodollar Borrowing;

                           (iv)   in the case of a Eurodollar Borrowing, the
         initial Interest Period to be applicable thereto, which shall be a
         period contemplated by the definition of the term "Interest Period";
         and

                           (v)    the location and number of the Borrower's
         account to which funds are to be disbursed, which shall comply with the
         requirements of Section 2.04.

                  If no election as to the Type of Revolving Borrowing is
specified, then the requested Revolving Borrowing shall be an ABR Borrowing. If
no Interest Period is specified with respect to any Eurodollar Revolving
Borrowing, then the Borrower shall be deemed to have selected an Interest Period
of one month's duration. Promptly following receipt of a Borrowing Request in
accordance with this Section, the Administrative Agent shall advise each Lender
of the details thereof and of the amount of such Lender's Loan to be made as
part of the requested Borrowing.

                  SECTION 2.04  Funding of Borrowings.
                                ---------------------

                  (a) Funding by Lenders. No later than 12:00 noon, New York,
                      ------------------
New York time, on the date specified in each Borrowing Request, each Lender will
make available its Applicable Percentage of each Revolving Borrowing requested
to be made on such date, in Dollars and in immediately available funds at the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders. The Administrative Agent will make such Loans
available to the Borrower by promptly crediting the amounts so received,

                                     -18-

<PAGE>

in like funds, to an account of the Borrower maintained with Union Bank of
California, N.A. at the Principal Office and designated by the Borrower in the
applicable Borrowing Request.

                  (b) Presumption by the Administrative Agent. Unless the
                      ---------------------------------------
Administrative Agent shall have received notice from a Lender prior to the
proposed date of any Borrowing that such Lender will not make available to the
Administrative Agent such Lender's share of such Borrowing, the Administrative
Agent may assume that such Lender has made such share available on such date in
accordance with paragraph (a) of this Section and may, in reliance upon such
assumption, make available to the Borrower a corresponding amount. In such
event, if a Lender has not in fact made its share of the applicable Borrowing
available to the Administrative Agent, then the applicable Lender and the
Borrower severally agree to pay to the Administrative Agent forthwith on demand
such corresponding amount with interest thereon, for each day from and including
the date such amount is made available to the Borrower to but excluding the date
of payment to the Administrative Agent, at (i) in the case of such Lender, the
Federal Funds Effective Rate or (ii) in the case of the Borrower, the interest
rate applicable to the Loans of such Borrowing. If such Lender pays such amount
to the Administrative Agent, then such amount shall constitute such Lender's
Loan included in such Borrowing.

                  SECTION 2.05  Interest Elections.
                                ------------------

                  (a) Elections by the Borrower for Borrowings. Each Borrowing
                      ----------------------------------------
initially shall be of the Type specified in the applicable Borrowing Request
and, in the case of a Eurodollar Borrowing, shall have an initial Interest
Period as specified in such Borrowing Request. Thereafter, the Borrower may
elect to convert such Borrowing to a different Type or to continue such
Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods
therefor, all as provided in this Section but subject to Section 2.02. Once
Loans have been made pursuant to a Borrowing, the Borrower may elect to convert
or continue different portions of such Borrowing, in which case each such
portion shall be allocated ratably among the Lenders holding the Loans
comprising such Borrowing, and the Loans comprising each such portion shall be
considered a separate Borrowing.

                  (b) Notice of Elections. To make an election pursuant to this
                      -------------------
Section, the Borrower shall notify the Administrative Agent of such election by
telephone by the time that a Borrowing Request would be required under Section
2.03 if the Borrower were requesting a Revolving Borrowing of the Type resulting
from such election to be made on the effective date of such election. Each such
telephonic Interest Election Request shall be irrevocable and shall be confirmed
promptly by hand delivery or telecopy to the Administrative Agent of a written
Interest Election Request in a form approved by the Administrative Agent and
signed by the Borrower.

                  (c) Information in Interest Election Requests. Each
                      -----------------------------------------
telephonic and written Interest Election Request shall specify the following
information in compliance with Section 2.02:

                           (i) the Borrowing to which such Interest Election
         Request applies and, if different options are being elected with
         respect to different portions thereof, the portions thereof to be
         allocated to each resulting Borrowing (in which case the

                                     -19-

<PAGE>

         information to be specified pursuant to clauses (iii) and (iv) of this
         paragraph shall be specified for each resulting Borrowing);

                           (ii)   the effective date of the election made
         pursuant to such Interest Election Request, which shall be a Business
         Day;

                           (iii)  whether the resulting Borrowing is to be an
         ABR Borrowing or a Eurodollar Borrowing; and

                           (iv)   if the resulting Borrowing is a Eurodollar
         Borrowing, the Interest Period to be applicable thereto after giving
         effect to such election, which shall be a period contemplated by the
         definition of the term "Interest Period".

                  If any such Interest Election Request requests a Eurodollar
Borrowing but does not specify an Interest Period, then the Borrower shall be
deemed to have selected an Interest Period of one month's duration.

                  (d) Notice by the Administrative Agent to Lenders. Promptly
                      ---------------------------------------------
following receipt of an Interest Election Request, the Administrative Agent
shall advise each Lender of the details thereof and of such Lender's portion of
each resulting Borrowing.

                  (e) Failure to Elect; Events of Default. If the Borrower fails
                      -----------------------------------
to deliver a timely Interest Election Request with respect to a Eurodollar
Borrowing prior to the end of the Interest Period applicable thereto, then,
unless such Borrowing is repaid as provided herein, at the end of such Interest
Period such Borrowing shall be converted to an ABR Borrowing. Notwithstanding
any contrary provision hereof, if an Event of Default has occurred and is
continuing and the Administrative Agent, at the request of the Required Lenders,
so notifies the Borrower, then, so long as an Event of Default is continuing (i)
no outstanding Borrowing may be converted to or continued as a Eurodollar
Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted
to an ABR Borrowing at the end of the Interest Period applicable thereto.

                  SECTION 2.06  Termination, Reduction and Extension of
                                ---------------------------------------
Commitments.
-----------

                  (a) Scheduled  Termination.  Unless previously  terminated,
                      ----------------------
the Commitments shall terminate on the Revolving Termination Date.

                  (b) Voluntary Termination or Reduction. The Borrower may at
                      ----------------------------------
any time prior to the Revolving Termination Date terminate, or from time to time
reduce, the Commitments; provided that (i) each reduction of the Commitments
                         --------
shall be in an amount of $25,000,000 or a multiple of $1,000,000 in excess
thereof and (ii) the Borrower shall not terminate or reduce the Commitments if,
after giving effect to any concurrent prepayment of the Loans in accordance with
Section 2.08, the sum of the total Revolving Credit Exposures would exceed the
total Commitments.

                  (c) Notice of Voluntary Termination or Reduction. The Borrower
                      --------------------------------------------
shall notify the Administrative Agent of any election to terminate or reduce the
Commitments under paragraph (b) of this Section at least three Business Days
prior to the effective date of such

                                     -20-

<PAGE>

termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any such notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower pursuant to this Section shall be irrevocable; provided that a notice
                                                        --------
of termination of the Commitments delivered by the Borrower may state that such
notice is conditioned upon the effectiveness of other credit facilities, in
which case such notice may be revoked by the Borrower (by notice to the
Administrative Agent on or prior to the specified effective date) if such
condition is not satisfied.

                  (d) Effect of Termination or Reduction. Any termination or
                      ----------------------------------
reduction of the Commitments shall be permanent. Except as otherwise provided in
Section 2.06(e) (i), each reduction of the Commitments shall be made ratably
among the Lenders in accordance with their Applicable Percentages.

                  (e) Extension of Commitments.
                      ------------------------

                           (i)      Not earlier than the date which is 60 days
(but not later than 30 days) prior to the then existing Revolving Termination
Date (the "Extension Request Notice Date"), the Borrower may deliver to the
           -----------------------------
Administrative Agent (which shall promptly transmit the same to each Lender) a
notice (an "Extension Request") requesting that the Revolving Termination Date
            -----------------
be extended for an additional 364 days commencing on the then existing
Revolving Termination Date. Not earlier than the date which is 30 days (but not
later than 20 days) prior to the then existing Revolving Termination Date (the
period from the Extension Request Notice Date to such date, the "Extension
                                                                 ---------
Request Period"), each Lender (in its sole and absolute discretion and after
--------------
conducting an internal credit review of the Borrower) shall notify the
Administrative Agent of such Lender's willingness or unwillingness to so extend
the Revolving Termination Date. Any Lender which shall fail to so notify the
Administrative Agent within such period shall be deemed to have declined to
extend the Revolving Termination Date. If Lenders having Commitments totaling
an amount equal to at least 51% of the aggregate amount of the Commitments then
in effect agree to such extension by notice to the Administrative Agent, then
(A) subject to clause (iii) below, the Revolving Termination Date shall be
extended for an additional 364 days with respect to the Commitments of the
Lenders so agreeing, and (B) subject to Section 2.06(f) hereof, the Commitment
of each Lender not so agreeing shall expire on the then expiring Revolving
Termination Date and the Borrower shall pay or prepay on such day without
premium or penalty all principal of such Lender's Loans together with accrued
interest thereon and all accrued facility fees and other amounts payable to
such Lender hereunder (including, without limitation, amounts payable pursuant
to Section 2.13 hereof as a result of such payment or prepayment); provided,
                                                                   --------
however, that
-------

                           (x) if Lenders having Commitments totaling an amount
                  equal to at least 51% of the aggregate amount of the
                  Commitments then in effect do not agree as contemplated by
                  Section 2.06(e)(i), then the Revolving Termination Date shall
                  not be extended pursuant to this Section 2.06(e) and the
                  Commitments of all of the Lenders shall remain in effect until
                  the Revolving Termination Date except as otherwise provided in
                  this Agreement; and

                                     -21-

<PAGE>

                           (y) the Borrower may not request any extension of the
                  Revolving Termination Date pursuant to this Section 2.06(e)(i)
                  more frequently than once in any calendar year.

                           (ii) Any Loan by any Lender the Commitment of which
is to terminate pursuant to Section 2.06(e)(i) hereof that would otherwise be
made or converted by such Lender as a Eurodollar Loan having an Interest Period
ending after the date such Commitment is to terminate shall be made or
continued as an ABR Loan and all ABR Loans of such Lender that would otherwise
be converted into Eurodollar Loans having such Interest Periods shall remain as
ABR Loans.

                           (iii) It shall be a condition precedent to any
extension of the Revolving Termination Date that: (a) on the date of such
extension no Default or Event of Default shall have occurred and be continuing;
(b) the representations and warranties made by the Borrower in Article III
shall be true and correct on and as of the date of such extension (or if any
such representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date); and (c) on the date of such extension
there shall have been no material adverse change in the consolidated financial
condition, operations, business or prospects taken as a whole of the Borrower
and its Subsidiaries from that set forth in its financial statements as of
September 30, 2001 referred to in Section 3.06 hereof or, if the Borrower has
delivered its financial statements for any fiscal year to the Lenders and the
Administrative Agent pursuant to Section 5.01(a) hereof, as of the date of the
most recent such financial statements. Each request for an extension of the
Revolving Termination Date pursuant to Section 2.06(e) shall constitute a
certification by the Borrower to the effect set forth in the preceding sentence
(both as of the date of such request and, unless the Borrower notifies the
Administrative Agent prior to the date of such extension, as of the date of
such extension).

                  (f) Substitute Lenders. In the event any Lender does not
                      ------------------
agree to any extension by the date provided pursuant to Section 2.06(e) hereof,
then, unless a Default or an Event of Default shall have occurred and be
continuing, the Borrower may, not later than 10 days following the expiration
of the Extension Request Period, designate one or more other banks (each such
bank being herein called a "Substitute Lender"), which may include any of the
                            -----------------
Lenders, acceptable to the Administrative Agent (which acceptance will not be
unreasonably withheld), to assume such non-consenting Lender's Commitment
hereunder and to purchase, on or before the date such Lender's Loans would
otherwise be required to be paid or prepaid hereunder, the Loans and Notes of
such Lender and such Lender's rights hereunder in respect thereof, without
recourse to or representation or warranty by, or expense to, such Lender. In
such event, the purchase price shall be equal to the outstanding principal
amount of the Loans and Notes payable to such Lender plus any accrued but
unpaid interest on such Loans and Notes and accrued but unpaid facility fees in
respect of such Lender's Commitment. Upon such assumption and purchase and the
receipt by such Lender of any other amounts payable to it by the Borrower under
this Agreement, and subject to the execution and delivery to the Administrative
Agent and such Lender by the Substitute Lender of documentation reasonably
satisfactory to the Administrative Agent and such Lender pursuant to which such
Substitute Lender shall assume the obligations of such original Lender under
this Agreement in respect of its Loans, Notes and Commitment and agree to
become a "Lender" hereunder (if not already a Lender) to the extent of the
Commitments, Loans and Notes assumed and purchased, the

                                     -22-

<PAGE>

Substitute Lender shall succeed to the rights, obligations and benefits of
such Lender hereunder in such respect (except for such rights, obligations and
benefits of the Lender as have accrued (other than principal, accrued interest
or facility fees) or are required to be performed by it on or prior to the date
of such assumption and purchase) (and such Lender shall be released from its
Commitment except for any liability arising or relating to any event occurring
prior to the date of such assumption and purchase) and the Substitute Lender
shall be deemed to have agreed to the relevant extension of the Revolving
Termination Date and, anything in Section 2.06(e) to the contrary
notwithstanding, whether such extension is effective shall be determined
accordingly; provided that following any such assumption and purchase the
             --------
Commitments of each Substitute Lender (including any Commitments theretofore
held by it) shall be not less than $10,000,000.

                  SECTION 2.07  Repayment of Loans; Evidence of Debt.
                                ------------------------------------

                  (a) Repayment. The Borrower hereby unconditionally promises to
                      ---------
pay to the Administrative Agent for account of the Lenders the outstanding
principal amount of the Revolving Loans on the Revolving Termination Date.

                  (b) Manner of Payment. Prior to any repayment or prepayment of
                      -----------------
any Borrowings hereunder, the Borrower shall select the Borrowing or Borrowings
to be paid and shall notify the Administrative Agent by telephone (confirmed by
telecopy) of such selection not later than 12:00 noon, New York, New York time,
three Business Days before the scheduled date of such repayment or prepayment;
provided that each repayment or prepayment of Borrowings shall be applied to
--------
repay or prepay any outstanding ABR Borrowings before any other Borrowings. If
the Borrower fails to make a timely selection of the Borrowing or Borrowings to
be repaid or prepaid, such payment shall be applied, first, to pay any
outstanding ABR Borrowings and, second, to other Borrowings in the order of the
remaining duration of their respective Interest Periods (the Borrowing with the
shortest remaining Interest Period to be repaid first). Each payment of a
Revolving Borrowing shall be applied ratably to the Loans included in such
Borrowing.

                  (c) Maintenance of Loan Accounts by Lenders. Each Lender shall
                      ---------------------------------------
maintain in accordance with its usual practice an account or accounts evidencing
the indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender, including the amounts of principal and interest payable and paid to
such Lender from time to time hereunder.

                  (d) Maintenance of Loan Accounts by the Administrative Agent.
                      --------------------------------------------------------
The Administrative Agent shall maintain accounts in which it shall record (i)
the amount of each Loan made hereunder and the Type thereof and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender hereunder
and (iii) the amount of any sum received by the Administrative Agent hereunder
for the account of the Lenders and each Lender's share thereof.

                  (e) Effect of Entries. The entries made in the accounts
                      -----------------
maintained pursuant to paragraphs (c) and (d) of this Section shall be prima
facie evidence of the existence and amounts of the obligations recorded therein;
provided that the failure of any Lender or the Administrative Agent to maintain
--------
such accounts or any error therein shall not in any manner affect the obligation
of the Borrower to repay the Loans in accordance with the terms of this
Agreement.

                                     -23-

<PAGE>

                  (f) Notes. Any Lender may request that Loans made by it be
                      -----
evidenced by a promissory note (each a "Note") in substantially the form of
                                        ----
Exhibit C. In such event, the Borrower shall prepare, execute and deliver to
such Lender a Note payable to the order of such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in the form of Exhibit C.
Thereafter, the Loans evidenced by such Note and interest thereon shall at all
times (including after assignment pursuant to Section 9.12) be represented by
one or more Notes in such form payable to the order of the payee named therein
(or, if such Note is a registered note, to such payee and its registered
assigns).

                  SECTION 2.08  Prepayment of Loans.
                                -------------------

                  (a)      Optional  Prepayments Right to Prepay  Borrowings.
                           -------------------------------------------------
The Borrower shall have the right at any time and from time to time to prepay
any Borrowing in whole or in part, subject to the requirements of this Section.

                  (b)      Notices, Etc. The Borrower shall notify the
                           ------------
Administrative Agent by telephone (confirmed by telecopy) of any optional
prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing,
not later than 12:00 noon, New York, New York time, three Business Days before
the date of prepayment, or (ii) in the case of prepayment of an ABR Borrowing,
not later than 12:00 noon, New York, New York time, one Business Day before the
date of prepayment. Each such notice shall be irrevocable and shall specify the
prepayment date and the principal amount of each Borrowing or portion thereof
to be prepaid; provided that, if a notice of prepayment is given in connection
             --------
with a conditional notice of termination of the Commitments as contemplated by
Section 2.06(c), then such notice of prepayment may be revoked if such notice of
termination is revoked in accordance with Section 2.06(c). Promptly following
receipt of any such notice relating to a Borrowing, the Administrative Agent
shall advise the Lenders of the contents thereof. Each partial prepayment of any
Borrowing shall be in an aggregate principal amount equal to $5,000,000 and a
multiple of $1,000,000 in excess thereof; provided that if any prepayment of
                                          --------
Eurodollar Loans made pursuant to a single Borrowing shall reduce the
outstanding Revolving Loans made pursuant to such Borrowing to an amount less
than $5,000,000, such outstanding Loans shall immediately be converted into ABR
Loans. Each prepayment of a Borrowing shall be applied ratably to the Loans
included in the prepaid Borrowing. Prepayments shall be accompanied by accrued
interest to the extent required by Section 2.10 and shall be made in the manner
specified in this Section 2.08(b).

                  SECTION 2.09  Fees.
                                ----

                  (a) Facility Fee. The Borrower shall pay to the Administrative
                      ------------
Agent for the account of each Lender a facility fee for the period from and
including the Effective Date to but excluding the Revolving Termination Date (or
such earlier date on which the total Commitments shall have been terminated)
computed at a rate per annum equal to the Applicable Rate on each Lender's daily
average Commitment, such fee to be paid quarterly in arrears on each Quarterly
Date and on the Revolving Termination Date (or such earlier date on which the
total Commitments shall have been terminated). The facility fee shall be
calculated on the basis of the actual number of days elapsed in a year of 360
days.

                                     -24-

<PAGE>

                  (b) Fee Letter. The Borrower agrees to pay to the
                      ----------
Administrative Agent, for the account of the Administrative Agent and the
Co-Lead Arrangers, the fees agreed to by the Borrower, SPPC, Sierra Pacific
Resources, the Administrative Agent and the Co-Lead Arrangers pursuant to that
certain letter agreement, dated the date hereof (the "Fee Letter"), or as
                                                      ----------
otherwise agreed from time to time.

                  (c) Payment of Fees. All fees payable hereunder shall be paid
                      ---------------
on the dates due, in immediately available funds, to the Administrative Agent
for distribution, in the case of facility fees, to the Lenders entitled thereto.

                  SECTION 2.10  Interest.
                                --------

                  (a) ABR Loans. The Loans comprising each ABR Revolving
                      ---------
Borrowing shall bear interest at a rate per annum equal to the Alternate Base
Rate plus the Applicable Rate.

                  (b) Eurodollar Loans. The Loans comprising each Eurodollar
                      ----------------
Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBO
Rate for the Interest Period in effect for such Borrowing plus the Applicable
Rate.

                  (c) Default Interest. Notwithstanding the foregoing, if any
                      ----------------
principal of or interest on any Loan or any fee or other amount payable by the
Borrower hereunder is not paid when due, whether at stated maturity, upon
acceleration or otherwise, such overdue amount shall bear interest, after as
well as before judgment, at a rate per annum equal to (i) in the case of overdue
principal of any Loan, 2% above the higher of (A) the rate otherwise applicable
to such Loan as provided above and (B) the rate applicable to ABR Loans as
provided in paragraph (a) of this Section, or (ii) in the case of any other
amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of
this Section.

                  (d) Payment of Interest. Accrued interest on each Loan shall
                      -------------------
be payable in arrears on each Interest Payment Date for such Loan and upon
termination of the Commitments; provided that (x) interest accrued pursuant to
                                --------
paragraph (c) of this Section shall be payable on demand, (y) in the event of
any repayment or prepayment of any Loan (other than a prepayment of an ABR
Revolving Loan prior to the Revolving Termination Date), accrued interest on the
principal amount repaid or prepaid shall be payable on the date of such
repayment or prepayment and (z) in the event of any conversion of any Eurodollar
Borrowing prior to the end of the current Interest Period therefor, accrued
interest on such Borrowing shall be payable on the effective date of such
conversion.

                  (e) Computation. All interest hereunder shall be computed on
                      -----------
the basis of a year of 360 days, and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day). The
applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be
determined by the Administrative Agent, and such determination shall be
conclusive, absent manifest error.

                                     -25-

<PAGE>

                  SECTION 2.11  Alternate Rate of Interest.  If prior to the
                                --------------------------
commencement of any Interest Period for a Eurodollar Borrowing:

                  (a) the Administrative Agent determines (which determination
shall be conclusive, absent manifest error) that adequate and reasonable means
do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as
applicable, for such Interest Period; or

                  (b) the Administrative Agent is advised by the Required
Lenders that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such
Interest Period will not adequately and fairly reflect the cost to such Lenders
(or Lender) of making or maintaining their Loans (or its Loan) included in such
Borrowing for such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower and the
Lenders by telephone or telecopy as promptly as practicable thereafter and,
until the Administrative Agent notifies the Borrower and the Lenders that the
circumstances giving rise to such notice no longer exist, (i) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective,
and (ii) if any Borrowing Request requests a Eurodollar Revolving Borrowing,
such Borrowing shall be made as an ABR Revolving Borrowing.

                  SECTION 2.12  Increased Costs.
                                ---------------

                  (a)      Increased Costs Generally.  If any Change in Law
                           -------------------------
shall:

                           (i) impose, modify or deem applicable any reserve,
         special deposit or similar requirement against assets of, deposits with
         or for the account of, or credit extended by, any Lender or its Parent
         (except any such reserve requirement reflected in the Adjusted LIBO
         Rate); or

                           (ii) impose on any Lender or its Parent or the London
         interbank market any other condition affecting this Agreement or
         Eurodollar Loans made by such Lender;

and the result of any of the foregoing shall be to increase the cost to such
Lender or its Parent of making or maintaining any Eurodollar Loan (or of
maintaining its obligation to make any such Loan) or to reduce the amount of any
sum received or receivable by such Lender hereunder (whether of principal,
interest or otherwise), then the Borrower will pay to such Lender such
additional amount or amounts as will compensate such Lender or its Parent, as
the case may be, for such additional costs incurred or reduction suffered.

                  (b) Capital Requirements. If any Lender determines that any
                      --------------------
Change in Law regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender's capital or on the capital of its
Parent as a consequence of this Agreement or the Loans made by such Lender to a
level below that which such Lender or its Parent could have achieved but for
such Change in Law (taking into consideration such Lender's policies and the
policies of its Parent with respect to capital adequacy), then from time to time
the Borrower will pay to such Lender such additional amount or amounts as will
compensate such Lender or its Parent for any such reduction suffered.

                                     -26-

<PAGE>

                  (c) Certificates from Lenders. A certificate of a Lender
                      -------------------------
setting forth the amount or amounts necessary to compensate such Lender or its
Parent, as the case may be, as specified in paragraph (a) or (b) of this Section
shall be delivered to the Borrower and shall be conclusive, absent manifest
error. The Borrower shall pay such Lender the amount shown as due on any such
certificate within 10 days after receipt thereof.

                  (d) Delay in Requests. Failure or delay on the part of any
                      -----------------
Lender to demand compensation pursuant to this Section shall not constitute a
waiver of such Lender's right to demand such compensation.

                  SECTION 2.13 Break Funding Payments. In the event of (a) the
                               ----------------------
payment of any principal of any Eurodollar Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of
Default), (b) the conversion of any Eurodollar Loan other than on the last day
of the Interest Period applicable thereto, (c) the failure to borrow, convert,
continue or prepay any Revolving Loan on the date specified in any notice
delivered pursuant hereto (regardless of whether such notice is permitted to be
revocable under Section 2.08(b) and is revoked in accordance herewith), or (d)
the assignment of any Eurodollar Loan other than on the last day of the Interest
Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.16, then, in any such event, the Borrower shall compensate each Lender
for the loss, cost and expense attributable to such event. In the case of a
Eurodollar Loan, the loss to any Lender attributable to any such event shall be
deemed to include an amount determined by such Lender to be equal to the excess,
if any, of (i) the amount of interest that such Lender would pay for a deposit
equal to the principal amount of such Loan for the period from the date of such
payment, conversion, failure or assignment to the last day of the then current
Interest Period for such Loan (or, in the case of a failure to borrow, convert
or continue, the duration of the Interest Period that would have resulted from
such borrowing, conversion or continuation) if the interest rate payable on such
deposit were equal to the Adjusted LIBO Rate for such Interest Period, over (ii)
the amount of interest that such Lender would earn on such principal amount for
such period if such Lender were to invest such principal amount for such period
at the interest rate that would be bid by such Lender (or an Affiliate of such
Lender) for dollar deposits from other banks in the eurodollar market at the
commencement of such period. A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this
Section shall be delivered to the Borrower and shall be conclusive, absent
manifest error. The Borrower shall pay such Lender the amount shown as due on
any such certificate within 10 days after receipt thereof.

                  SECTION 2.14  Taxes.
                                -----

                  (a) Payments Free of Taxes. Any and all payments by or on
                      ----------------------
account of any obligation of the Borrower hereunder shall be made free and clear
of and without deduction for any Indemnified Taxes or Other Taxes; provided that
                                                                   --------
if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes
from such payments, then (i) the sum payable shall be increased as necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section) the Administrative Agent, each
Co-Lead Arranger, the Syndication Agent or each Lender (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower

                                     -27-

<PAGE>

shall make such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant Governmental Authority in accordance with applicable
Law.

                  (b) Payment of Other Taxes by the Borrower. In addition, the
                      --------------------------------------
Borrower shall pay any Other Taxes to the relevant Governmental Authority in
accordance with applicable Law.

                  (c) Indemnification by the Borrower. The Borrower shall
                      -------------------------------
indemnify the Administrative Agent, each Co-Lead Arranger, the Syndication Agent
and each Lender, within 10 days after written demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or
Other Taxes imposed or asserted on or attributable to amounts payable under this
Section) paid by the Administrative Agent, such Co-Lead Arranger, the
Syndication Agent or such Lender, as the case may be, and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto,
whether or not such Indemnified Taxes or Other Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority. A certificate as to
the amount of such payment or liability delivered to the Borrower by a Lender, a
Co-Lead Arranger, the Syndication Agent or the Administrative Agent (on its own
behalf or on behalf of a Lender, a Co-Lead Arranger or the Syndication Agent)
shall be conclusive, absent manifest error.

                  (d) Evidence of Payments. As soon as practicable after any
                      --------------------
payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental
Authority, the Borrower shall deliver to the Administrative Agent the original
or a certified copy of a receipt issued by such Governmental Authority
evidencing such payment, a copy of the return reporting such payment or other
evidence of such payment reasonably satisfactory to the Administrative Agent.

                  (e) Foreign Lenders. Any Foreign Lender that is entitled to an
                      ---------------
exemption from or reduction of withholding tax under the Law of the jurisdiction
in which the Borrower is located, or any treaty to which such jurisdiction is a
party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable Law or reasonably requested by the Borrower, such
properly completed and executed documentation prescribed by applicable Law as
will permit such payments to be made without withholding or at a reduced rate.

                  SECTION 2.15  Payments Generally; Pro Rata Treatment; Sharing
                                -----------------------------------------------
of Set-offs.
------------

                  (a) Payments by the Borrower. The Borrower shall make each
                      ------------------------
payment required to be made by it hereunder (whether of principal, interest or
fees, or under Section 2.12, 2.13 or 2.14, or otherwise) prior to 1:00 PM, New
York, New York time, on the date when due, in immediately available funds,
without set-off or counterclaim. Any amounts received after such time on any
such date shall be deemed to have been received on the next succeeding Business
Day for purposes of calculating interest thereon. All such payments shall be
made to the Administrative Agent at its Principal Office and to such account at
its Principal Office as the Administrative Agent shall specify to the Borrower,
except that payments pursuant to Sections 2.12, 2.13, 2.14 and 9.04 shall be
made directly to the Persons entitled thereto. The Administrative Agent shall
distribute any such payments received by it for account of any other Person to
the appropriate recipient promptly following receipt thereof. If any payment
hereunder shall be due on a day that is not a Business Day, the date for payment
shall be extended to the

                                     -28-

<PAGE>

next succeeding Business Day and, in the case of any payment accruing interest,
interest thereon shall be payable for the period of such extension. All
payments hereunder shall be made in Dollars.

                  (b) Application of Insufficient Payments. If at any time
                      ------------------------------------
insufficient funds are received by and available to the Administrative Agent to
pay fully all amounts of principal, interest and fees then due hereunder, such
funds shall be applied (i) first, to pay interest and fees then due hereunder,
ratably among the parties entitled thereto in accordance with the amounts of
interest and fees then due to such parties, and (ii) second, to pay principal
then due hereunder, ratably among the parties entitled thereto in accordance
with the amounts of principal then due to such parties.

                  (c) Pro Rata Treatment. Except to the extent otherwise
                      ------------------
provided herein: (i) each Revolving Borrowing shall be made from the Lenders,
each payment of facility fees under Section 2.09 shall be made for the account
of the Lenders, and each termination or reduction of the amount of the
Commitments under Section 2.06 shall be applied to the respective Commitments of
the Lenders, pro rata according to the amounts of their respective Commitments;
(ii) each Borrowing shall be allocated pro rata among the Lenders according to
the amounts of their respective Commitments (in the case of the making of
Revolving Loans) or their respective Loans (in the case of conversions and
continuations of Loans); (iii) each payment or prepayment of principal of Loans
by the Borrower shall be made for the account of the Lenders pro rata in
accordance with the respective unpaid principal amounts of the Loans held by
them; and (iv) each payment of interest on Loans by the Borrower shall be made
for the account of the Lenders pro rata in accordance with the amounts of
interest on such Loans then due and payable to the respective Lenders.

                  (d) Sharing of Payments by Lenders. If any Lender shall, by
                      ------------------------------
exercising any right of set-off or counterclaim or otherwise, obtain payment in
respect of any principal of or interest on any of its Loans resulting in such
Lender receiving payment of a greater proportion of the aggregate amount of its
Loans and accrued interest thereon then due than the proportion received by any
other Lender, then the Lender receiving such greater proportion shall purchase
(for cash at face value) participations in the Loans of other Lenders to the
extent necessary so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of principal of and
accrued interest on their respective Loans; provided that (i) if any such
                                            --------
participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest, and (ii) the
provisions of this paragraph shall not be construed to apply to any payment made
by the Borrower pursuant to and in accordance with the express terms of this
Agreement or any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans to any assignee or
participant, other than to the Borrower or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply). The Borrower
consents to the foregoing and agrees, to the extent it may effectively do so
under applicable Law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against the Borrower rights of set-off and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of the Borrower in the amount of such participation.

                                     -29-

<PAGE>

                  (e) Presumptions of Payment. Unless the Administrative Agent
                      -----------------------
shall have received notice from the Borrower prior to the date on which any
payment is due to the Administrative Agent for the account of the Lenders
hereunder that the Borrower will not make such payment, the Administrative Agent
may assume that the Borrower has made such payment on such date in accordance
herewith and may, in reliance upon such assumption, distribute to the Lenders
the amount due. In such event, if the Borrower has not in fact made such
payment, then each of the Lenders severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender with interest thereon, for each day from and including the date such
amount is distributed to it to but excluding the date of payment to the
Administrative Agent, at the Federal Funds Effective Rate.

                  (f) Certain Deductions by the Administrative Agent. If any
                      ----------------------------------------------
Lender shall fail to make any payment required to be made by it pursuant to
Section 2.04(b) or 2.15(e), then the Administrative Agent may, in its discretion
(notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for the account of such Lender to satisfy
such Lender's obligations under such Sections until all such unsatisfied
obligations are fully paid.

                  SECTION 2.16  Mitigation Obligations; Replacement of Lenders.
                                ----------------------------------------------

                  (a) Designation of a Different Lending Office. If any Lender
                      -----------------------------------------
requests compensation under Section 2.12, or if the Borrower is required to pay
any additional amount to any Lender or any Governmental Authority for the
account of any Lender pursuant to Section 2.14, then such Lender shall use
reasonable efforts to designate a different lending office for funding or
booking its Loans hereunder or to assign its rights and obligations hereunder to
another of its offices, branches or affiliates, if, in the judgment of such
Lender, such designation or assignment (i) would eliminate or reduce amounts
payable pursuant to Section 2.12 or 2.14, as the case may be, in the future and
(ii) would not subject such Lender to any unreimbursed cost or expense and would
not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment.

                  (b) Replacement of Lenders. If any Lender requests
                      ----------------------
compensation under Section 2.12, or if the Borrower is required to pay any
additional amount to any Lender or any Governmental Authority for the account of
any Lender pursuant to Section 2.14, or if any Lender defaults in its obligation
to fund Loans hereunder, then the Borrower may, at its sole expense and effort,
upon notice to such Lender and the Administrative Agent, require such Lender to
assign and delegate, without recourse (in accordance with and subject to the
restrictions contained in Section 9.12), all its interests, rights and
obligations under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Lender, if a Lender accepts such
assignment); provided that (i) the Borrower shall have received the prior
             --------
consent of the Administrative Agent, which consent shall not unreasonably be
withheld, (ii) such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrower (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.12 or payments required
to be made pursuant to Section 2.14,

                                     -30-

<PAGE>

such assignment will result in a reduction in such compensation or payments. A
Lender shall not be required to make any such assignment and delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.

                                  ARTICLE III
                        REPRESENTATIONS AND WARRANTIES

                  The  Borrower  hereby  represents  and  warrants to the
Administrative Agent and each Lender as follows:

                  SECTION 3.01  Corporate Status.
                                ----------------

                  The Borrower and each Subsidiary of the Borrower is a
corporation, trust or limited liability company duly organized, validly existing
and in good standing under the Laws of its jurisdiction of organization. The
Borrower and each Subsidiary of the Borrower has the power (corporate or
otherwise) and authority to own its Property and to transact the business in
which it is engaged or presently proposes to engage. The Borrower and each
Subsidiary of the Borrower is duly qualified to do business as a foreign
corporation, trust or limited liability company and is in good standing in all
jurisdictions in which the ownership of its Properties or the nature of its
activities or both makes such qualification necessary or advisable. Schedule II
states as of the date hereof the jurisdiction of organization of the Borrower
and each Subsidiary of the Borrower, and the jurisdictions in which the Borrower
and each Subsidiary of the Borrower is qualified to do business as a foreign
corporation, trust or limited liability company.

                  SECTION 3.02  Corporate Power and Authorization.
                                ---------------------------------

                  The Borrower has the corporate power and authority to execute,
deliver, perform, and take all actions contemplated by this Agreement and each
of the other Loan Documents to which it is a party, and all such actions have
been duly and validly authorized by all necessary corporate proceedings on its
part. Without limiting the foregoing, the Borrower has the corporate power and
authority to borrow pursuant to the Loan Documents to the fullest extent
permitted hereby and thereby from time to time, and has taken all necessary
corporate action to authorize such borrowings.

                  SECTION 3.03  Execution and Binding Effect.
                                ----------------------------

                  This Agreement and each of the other Loan Documents to which
the Borrower is a party and which is required to be delivered on or before the
Effective Date pursuant to Section 4.01 has been duly and validly executed and
delivered by the Borrower. This Agreement and each such other Loan Document
constitutes, and when executed and delivered by the Borrower will constitute,
the legal, valid and binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms, except as the enforceability hereof or
thereof may be limited by bankruptcy, insolvency or other similar laws of
general application affecting the enforcement of creditors' rights or by general
principles of equity limiting the availability of equitable remedies.

                                     -31-

<PAGE>

                  SECTION 3.04  Governmental Approvals and Filings.
                                ----------------------------------

                  The Public Utilities Commission of Nevada has duly and validly
issued orders authorizing the Borrower to enter into this Agreement and the
other Loan Documents to which it is a party and to take all actions contemplated
hereby or thereby or in connection herewith or therewith, and such orders remain
in full force and effect in the form issued. No other Governmental Action is
required for the due execution, delivery and performance by the Borrower of this
Agreement or any of the other Loan Documents to which it is a party.

                  SECTION 3.05  Absence of Conflicts.
                                --------------------

                  Neither the execution and delivery of any of the Loan
Documents by the Borrower, nor the consummation of the transactions herein or
therein contemplated by the Borrower, nor the performance of or the compliance
with the terms and conditions hereof or thereof by the Borrower, does or will:

                  (a)      violate or conflict with any Law; or

                  (b)      violate, conflict with or result in a breach of any
term or condition of, or constitute a default under, or result in (or give rise
                      --                             --
 to any right, contingent or otherwise, of any Person to cause) any termination,
cancellation, prepayment or acceleration of performance of, or result in the
                                                            --
creation or imposition of (or give rise to any obligation, contingent or
otherwise, to create or impose) any Lien upon any of the Property of the
Borrower or any Subsidiary of the Borrower pursuant to, or otherwise result in
                                                        --
(or give rise to any right, contingent or otherwise, of any Person to cause) any
change in any right, power, privilege, duty or obligation of the Borrower or any
Subsidiary of the Borrower under or in connection with,

                           (i)      the articles of  incorporation or by-laws
         (or other constituent documents) of the Borrower or any Subsidiary of
         the Borrower;

                           (ii)     any agreement or instrument creating,
         evidencing or securing any Indebtedness to which the Borrower or any
         Subsidiary of the Borrower is a party or by which any of them or any of
         their respective properties (now owned or hereafter acquired) may be
         subject or bound; or

                           (iii)    any other material agreement or instrument
         to which the Borrower or any Subsidiary of the Borrower is a party or
         by which any of them or any of their respective properties (now owned
         or hereafter acquired) may be subject or bound.

                  SECTION 3.06  Audited Financial Statements.
                                ----------------------------

                  The Borrower has heretofore furnished to each of the Agents
and each of the Lenders consolidated balance sheets of the Borrower and its
consolidated Subsidiaries as of December 31, 1998, 1999 and 2000 and the related
consolidated statements of income, retained earnings and changes in cash flows
for the fiscal years then ended, as examined and reported on by independent
certified public accountants for the Borrower, who delivered an unqualified
opinion in respect thereof. Such financial statements (including the notes
thereto) present fairly the financial condition of the Borrower and its
consolidated Subsidiaries as of the end of each

                                     -32-

<PAGE>

such fiscal year and the results of their operations and their retained
earnings and changes in cash flows for the fiscal years then ended, all in
conformity with GAAP.

                  SECTION 3.07  Interim Financial Statements.
                                ----------------------------

                  The Borrower has heretofore furnished to each of the Agents
and each of the Lenders an interim consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as of the end of the third fiscal quarter of
the fiscal year beginning January 1, 2001, together with the related
consolidated statements of income, retained earnings and changes in cash flows
for the applicable fiscal period ending on such date. Such financial statements
(including the notes thereto) present fairly the financial condition of the
Borrower and its consolidated Subsidiaries as of the end of such fiscal quarter
and the results of their operations and their retained earnings and changes in
cash flows for the fiscal periods then ended, all in conformity with GAAP,
subject to normal and recurring year-end audit adjustments.

                  SECTION 3.08  Absence of Undisclosed Liabilities.
                                ----------------------------------

                  Neither the Borrower nor any Subsidiary of the Borrower has
any liability or obligation of any nature whatever (whether absolute, accrued,
contingent or otherwise, whether or not due), forward or long-term commitments
or unrealized or anticipated losses from unfavorable commitments, except (a) as
disclosed in the financial statements referred to in Sections 3.06 and 3.07, and
(b) liabilities, obligations, commitments and losses incurred after September
30, 2001, in the ordinary course of business and consistent with past practices.

                  SECTION 3.09  Absence of Material Adverse Change.
                                ----------------------------------

                  Since September 30, 2001, there has been no material adverse
change in the business, operations, condition (financial or otherwise), or
prospects of the Borrower and its Subsidiaries taken as a whole.

                  SECTION 3.10  Accurate and Complete Disclosure.
                                --------------------------------

                  All information heretofore, contemporaneously or hereafter
provided by or on behalf of the Borrower to any Agent or any Lender pursuant to
or in connection with any Loan Document or any transaction contemplated hereby
or thereby is or will be (as the case may be) true and accurate in all material
respects on the date as of which such information is dated (or, if not dated,
when received by such Agent or such Lender) and does not or will not (as the
case may be) omit to state any material fact necessary to make such information
not misleading at such time in light of the circumstances in which it was
provided. The Borrower has disclosed to each Agent and each Lender in writing
every fact or circumstance which has, or which so far as the Borrower can
reasonably foresee is reasonably likely and is reasonably likely to have, a
Material Adverse Effect.

                  SECTION 3.11  Margin Regulations.
                                ------------------

                  No part of the proceeds of any Loan hereunder will be used for
the purpose of buying or carrying any "margin stock", as such term is used in
Regulation U of the Board, as amended from time to time, or to extend credit to
others for the purpose of buying or carrying

                                     -33-

<PAGE>

any "margin stock". Neither the Borrower nor any Subsidiary of the Borrower is
engaged in the business of extending credit to others for the purpose of buying
or carrying "margin stock". Neither the Borrower nor any Subsidiary of the
Borrower owns any "margin stock". Neither the making of any Loan nor any use
of proceeds of any such Loan will violate or conflict with the provisions of
Regulation T, U or X of the Board, as amended from time to time.

                  SECTION 3.12  Litigation.
                                ----------

                  There is no pending or (to the Borrower's knowledge after due
inquiry) threatened action, suit, proceeding or investigation (including any
Environmental Claim) by or before any Governmental Authority against or
affecting the Borrower or any Subsidiary of the Borrower which, if adversely
decided, individually or in the aggregate, would reasonably be expected to have
a Material Adverse Effect, except for (a) matters described in the financial
statements referred to in Section 3.06 and (b) matters set forth in Schedule
III.

                  SECTION 3.13 Absence of Events of Default.
                               ----------------------------

                  No event has occurred and is continuing and no condition
exists which constitutes a Default or an Event of Default.

                  SECTION 3.14  Absence of Other Conflicts.
                                --------------------------

                  Neither the Borrower nor any Subsidiary of the Borrower is in
violation of or conflict with, or is subject to any contingent liability on
account of any violation of or conflict with:

                  (a)      any Law (including  ERISA, the Code, any applicable
         occupational health, safety or welfare Law or any applicable
         Environmental Law);

                  (b)      its articles of incorporation or by-laws (or other
         constituent documents); or

                  (c)      any agreement or instrument to which it is party or
         by which it or any of its properties (now owned or hereafter acquired)
         may be subject or bound;

except for matters which, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect.

                  SECTION 3.15  Insurance.
                                ---------

                  The Borrower and each Subsidiary of the Borrower maintains
with financially sound and reputable insurers insurance with respect to its
properties and business and against at least such liabilities, casualties and
contingencies and in at least such types and amounts as is customary in the case
of corporations engaged in the same or a similar business or having similar
properties similarly situated.

                                     -34-

<PAGE>

                  SECTION 3.16  Title to Property; No Liens.
                                ---------------------------

                  The Borrower and each Subsidiary of the Borrower has good and
marketable title in fee simple to all real Property owned or purported to be
owned by it and good title to all other Property of whatever nature owned or
purported to be owned by it, including but not limited to all Property reflected
in the most recent audited balance sheet referred to in Section 3.06 or
submitted pursuant to Section 5.01(b), as the case may be (except as sold or
otherwise disposed of in the ordinary course of business after the date of such
balance sheet), subject to no Liens except for (i) Liens reflected in the most
recent audited balance sheet referred to in Section 3.06 or submitted pursuant
to Section 5.01(b), as the case may be, (ii) Liens consisting of zoning or
planning restrictions, easements, permits and other restrictions or limitations
on the use of real Property or irregularities in title thereto which do not
materially detract from the value of, or impair the use of, such Property by the
Borrower or any Subsidiary of the Borrower in the operation of its business,
(iii) Liens for current Taxes not yet due and delinquent and (iv) Liens set
forth on Schedule IV.

                  SECTION 3.17  Taxes.
                                -----

                  All tax and information returns required to be filed by or on
behalf of the Borrower or any Subsidiary of the Borrower have been properly
prepared, executed and filed. All Taxes upon the Borrower or any Subsidiary of
the Borrower or upon any of their respective Properties, incomes, sales or
franchises which are due and payable have been paid, other than those not yet
delinquent and payable without premium or penalty, and except for those being
diligently contested in good faith by appropriate proceedings, and in each case
for which adequate reserves and provisions for Taxes have been made on the books
of the Borrower and each Subsidiary of the Borrower. The reserves and provisions
for Taxes on the books of the Borrower and each Subsidiary of the Borrower are
adequate for all open years and for its current fiscal period. Neither the
Borrower nor any Subsidiary of the Borrower knows of any proposed additional
assessment or basis for any material assessment for additional Taxes (whether or
not reserved against).

                  SECTION 3.18  Borrower Not An Investment Company.
                                ----------------------------------

                  Neither the Borrower nor any Subsidiary of the Borrower is an
"investment company" or a company controlled by an "investment company" within
the meaning of the Investment Company Act of 1940.

                  SECTION 3.19  Environmental Matters.
                                ---------------------

                  (a) The Borrower and each of its Subsidiaries have complied
with and are in compliance with all applicable Environmental Laws and the
requirements of any permits issued under such Environmental Laws. Except as
disclosed on Schedule V, there are no pending or threatened Environmental Claims
against the Borrower or any of its Subsidiaries (including any such claim
arising out of the ownership, lease or operation by the Borrower or any of its
Subsidiaries of any real Property no longer owned, leased or operated by the
Borrower or any of its Subsidiaries) or any real Property owned, leased or
operated by the Borrower or any of its Subsidiaries. Except as disclosed on
Schedule V, there are no facts, circumstances, conditions or

                                     -35-

<PAGE>

occurrences with respect to the business or operations of the Borrower or any
of its Subsidiaries, or any real Property owned, leased or operated by the
Borrower or any of its Subsidiaries (including any real Property formerly
owned, leased or operated by the Borrower or any of its Subsidiaries but no
longer owned, leased or operated by the Borrower or any of its Subsidiaries) or
any Property adjoining or adjacent to any such real Property that could be
expected (i) to form the basis of an Environmental Claim against the Borrower
or any of its Subsidiaries or any real Property owned, leased or operated by
the Borrower or any of its Subsidiaries or (ii) to cause any real Property
owned, leased or operated by the Borrower or any of its Subsidiaries to be
subject to any restrictions on the ownership, occupancy or transferability of
such real Property by the Borrower or any of its Subsidiaries under any
applicable Environmental Law.

                  (b) Hazardous Materials have not at any time been generated,
used, treated or stored on, or transported to or from, any real Property owned,
leased or operated by the Borrower or any of its Subsidiaries where such
generation, use, treatment or storage has violated or could be expected to
violate any Environmental Law. Hazardous Materials have not at any time been
Released on or from any real Property owned, leased or operated by the Borrower
or any of its Subsidiaries where such Release has violated or would be expected
to violate any applicable Environmental Law.

                  (c) Notwithstanding anything to the contrary in this Section,
the representations made in this Section shall not be untrue unless the effect
of all violations, claims, restrictions, failures and noncompliances of the
types described in this Section would reasonably be expected to, individually or
in the aggregate, have a Material Adverse Effect.

                  SECTION 3.20  ERISA.
                                -----

                  (a) Each Plan (and each related trust, insurance contract or
fund) is in substantial compliance with its terms and with all applicable Laws,
including without limitation ERISA and the Code; each Plan (and each related
trust, if any) which is intended to be qualified under Section 401(a) of the
Code has received a determination letter from the Internal Revenue Service to
the effect that it meets the requirements of Sections 401(a) and 501(a) of the
Code; no Reportable Event has occurred; no Multiemployer Plan is insolvent or in
reorganization; no Plan has an Unfunded Current Liability; no Plan which is
subject to Section 412 of the Code or Section 302 of ERISA has an accumulated
funding deficiency within the meaning of such sections of the Code or ERISA or
has applied for or received a waiver of an accumulated funding deficiency or an
extension of any amortization period within the meaning of Section 412 of the
Code or Section 303 or 304 of ERISA; all contributions required to be made with
respect to a Plan have been timely made; neither the Borrower nor any Subsidiary
of the Borrower nor any ERISA Affiliate has incurred any material liability
(including any indirect, contingent or secondary liability) to or on account of
a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971 or 4975 of the Code or
expects to incur any such liability under any of the foregoing sections with
respect to any Plan; no condition exists which presents a material risk to the
Borrower or any Subsidiary of the Borrower or any ERISA Affiliate of incurring a
liability to or on account of a Plan pursuant to the foregoing provisions of
ERISA and the Code; no proceedings have been instituted to terminate or appoint
a trustee to administer any Plan; no action, suit, proceeding, hearing, audit or
investigation with respect to the administration, operation or the investment of
assets of any

                                     -36-

<PAGE>

Plan (other than routine claims for benefits) is pending, expected or
threatened; using actuarial assumptions and computation methods consistent with
Part 1 of subtitle E of Title IV of ERISA, the aggregate liabilities of the
Borrower and its Subsidiaries and its ERISA Affiliates to all Multiemployer
Plans in the event of a complete withdrawal therefrom, as of the close of the
most recent fiscal year of each such Plan ended prior to the date of the most
recent Borrowing, would not have a Material Adverse Effect; each group health
plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of the Code)
which covers or has covered employees or former employees of the Borrower, any
Subsidiary of the Borrower, or any ERISA Affiliate has at all times been
operated in compliance with the provisions of Part 6 of subtitle B of Title I
of ERISA and Section 4980B of the Code; no Lien imposed under the Code or ERISA
on the assets of the Borrower or any Subsidiary of the Borrower or any ERISA
Affiliate exists or is likely to arise on account of any Plan; and the Borrower
and its Subsidiaries may cease contributions to or terminate any Plan
maintained by any of them without incurring any material liability.

                  (b) Each Foreign Pension Plan, if any, has been maintained in
substantial compliance with its terms and with the requirements of any and all
applicable Laws, statutes, rules, regulations and orders and has been
maintained, where required, in good standing with applicable regulatory
authorities. All contributions required to be made with respect to a Foreign
Pension Plan have been timely made. Neither the Borrower nor any of its
Subsidiaries has incurred any obligation in connection with the termination of
or withdrawal from any Foreign Pension Plan. The present value of the accrued
benefit liabilities (whether or not vested) under each Foreign Pension Plan,
determined as of the end of the Borrower's most recently ended fiscal year on
the basis of actuarial assumptions, each of which is reasonable, did not exceed
the current value of the assets of such Foreign Pension Plan allocable to such
benefit liabilities.

                  SECTION 3.21  Pari Passu Status.
                                -----------------

                  The claims and rights of the Lenders against the Borrower
hereunder are not subordinated to, but rank at least pari passu with, the claims
and rights of other holders of its unsecured indebtedness except to the extent
otherwise provided by Law (including, without limitation, the Bankruptcy Code
and the provisions of 31 U.S.C. [sect.] 3713).

                  SECTION 3.22  Indebtedness.
                                ------------

                  Schedule VI contains a true and complete list of all
Indebtedness of the Borrower and its Subsidiaries that is, or will be,
outstanding on the Effective Date ("Existing Indebtedness").
                                    ---------------------

                  SECTION 3.23  General and Refunding Mortgage Bonds.
                                ------------------------------------

                  Upon any issuance of General and Refunding Mortgage Bonds
pursuant to Section 6.09(b) and at all times thereafter, such General and
Refunding Mortgage Bonds will have been duly and validly issued and will be
entitled to the security and benefits of the General and Refunding Mortgage
Indenture; will be secured equally and ratably with and only with all other
bonds issued and outstanding under the General and Refunding Mortgage Indenture;
will be secured by direct and valid, duly perfected Liens on and security
interests in the collateral purported to secure such bonds in the General and
Refunding Mortgage Indenture, subject only

                                     -37-

<PAGE>

to the prior Lien of the First Mortgage Indenture and to Permitted Liens (as
such term is defined in the General and Refunding Mortgage Indenture); and will
constitute collateral security for the obligations of the Borrower as purported
to be provided in the General and Refunding Mortgage Indenture and herein.

                                  ARTICLE IV
                                  CONDITIONS

                  SECTION 4.01  Effective Date.
                                --------------

                  This Agreement and the other Loan Documents shall become
effective as against the Lenders and the Agents on the first date on which all
of the following conditions shall be satisfied or waived:

                  (a) Agreement; Notes. The Administrative Agent shall have
                      ----------------
         received an executed counterpart of this Agreement for each Lender,
         duly executed by the Borrower, and, to the extent any Lender has
         requested a Note pursuant to Section 2.07(f), a Note conforming to the
         requirements hereof, duly executed on behalf of the Borrower.

                  (b) Governmental Approvals and Filings. The Administrative
                      ----------------------------------
         Agent shall have received, with copies and executed counterparts for
         each Lender, true and correct copies (in each case certified as to
         authenticity on such date on behalf of the Borrower) of the orders
         entered by the Public Utilities Commission of Nevada referred to in
         Section 3.04, and such orders shall be satisfactory in form and
         substance to the Administrative Agent and shall be in full force and
         effect.

                  (c) Corporate Proceedings. The Administrative Agent shall have
                      ---------------------
         received, with a counterpart for each Lender, certificates by the
         Secretary or Assistant Secretary of the Borrower dated as of the
         Effective Date as to (i) true copies of the articles of incorporation
         and by-laws (or other constituent documents) of the Borrower as in
         effect on such date (which, in the case of articles of incorporation or
         other constituent documents filed or required to be filed with the
         Secretary of State or other Governmental Authority in its jurisdiction
         of incorporation, shall be certified to be true, correct and complete
         by such Secretary of State or other Governmental Authority not more
         than 30 days before the date hereof), (ii) true copies of all corporate
         action taken by the Borrower relative to this Agreement and the other
         Loan Documents, and (iii) the incumbency and signatures of the
         respective officers of the Borrower executing this Agreement and the
         other Loan Documents to which the Borrower is a party, together with
         satisfactory evidence of the incumbency of such Secretary or Assistant
         Secretary. The Administrative Agent shall have received, with a copy
         for each Lender, certificates from the Secretary of State of Nevada (or
         other applicable Governmental Authority) dated not more than 30 days
         before the Effective Date showing the good standing of the Borrower in
         Nevada and in each state in which the Borrower does business.

                  (d) Legal Opinions of Counsel to the Borrower. The
                      -----------------------------------------
         Administrative Agent shall have received, with an executed counterpart
         for each Lender, opinions addressed to the Administrative Agent and
         each Lender, dated the Effective Date, of (i) Choate, Hall

                                     -38-

<PAGE>

         & Stewart, special counsel to the Borrower, and (ii) Woodburn & Wedge,
         Nevada counsel to the Borrower, in each case as to such matters as may
         be requested by the Administrative Agent and in form and substance
         satisfactory to the Lenders.

                  (e) Financial Statements; Projections. The Administrative
                      ---------------------------------
         Agent shall have received for each Lender a true and correct copy of
         the (i) audited consolidated financial statements, including balance
         sheets, income statements and cash flow statements, for the Borrower
         and each of its consolidated Subsidiaries for the years ended December
         31, 1998, 1999 and 2000, (ii) unaudited interim consolidated financial
         statements, including a balance sheet, income statement and statement
         of cash flows, for the Borrower and its consolidated Subsidiaries for
         the nine month period ended September 30, 2001 and (iii) Projections
         for each quarterly period ending after the date hereof and on or before
         December 31, 2002.

                  (f) No Material Adverse Effect. Nothing shall have occurred
                      --------------------------
         (and neither the Administrative Agent nor the Lenders shall have become
         aware of any facts or conditions not previously known) which the
         Lenders shall determine (i) has had, or could reasonably be expected to
         have, a Material Adverse Effect. The Administrative Agent shall have
         received a certificate of a senior financial officer of the Borrower,
         dated the Effective Date, to the effect that, as of the Effective Date,
         there has been no Material Adverse Effect since September 30, 2001.

                  (g) Governmental Approvals. All necessary and material
                      ----------------------
         Governmental Actions (domestic and foreign) and third party approvals
         and/or consents in connection with the transactions contemplated in
         this Agreement shall have been obtained and remain in effect and all
         applicable waiting periods with respect thereto shall have expired
         without any action being taken by any competent authority which
         restrains, prevents or imposes materially adverse conditions upon, the
         consummation of the transactions contemplated hereby or otherwise
         referred to herein. The Administrative Agent shall have received
         documentation reasonably acceptable to it that the Public Utilities
         Commission of Nevada has duly approved the Borrowings hereunder.

                  (h) No Injunctions. There shall not exist any judgment, order,
                      --------------
         injunction or other restraint issued or filed or a hearing seeking
         injunctive relief or other restraint pending or notified prohibiting or
         imposing materially adverse conditions upon the consummation of the
         transactions contemplated hereby or otherwise referred to herein.

                  (i) Litigation, Proceedings and Investigations. There shall be
                      ------------------------------------------
         no actions, arbitrations, suits, investigations or proceedings pending
         or threatened with respect to this Agreement or which the
         Administrative Agent shall determine could reasonably be expected to
         have a Material Adverse Effect.

                  (j) No Violation of Existing  Agreements. Neither the
                      ------------------------------------
         Borrower nor any Subsidiary of the Borrower is in violation of any
         material agreement or instrument to which it is party or by which it or
         any of its properties (now owned or hereafter acquired) may be subject
         or bound;

                                     -39-

<PAGE>

                  (k) Ratings. The Administrative Agent shall have received a
                      -------
         certificate of a senior financial officer of the Borrower, dated the
         Effective Date, setting forth the then current ratings of the Index
         Debt of Borrower.

                  (l) Officers' Certificates. The Administrative Agent shall
                      ----------------------
         have received, with an executed counterpart for each Lender,
         certificates from such officers of the Borrower as to such matters
         as the Administrative Agent may request.

                  (m) Fees, Expenses, etc. All fees and other items required to
                      -------------------
         be paid to the Agents and the Lenders on or before the Effective Date
         (including all fees referenced in fee letters and offer letters) shall
         have been paid or received.

                  (n) Section 4.02 Conditions.
                      -----------------------

                           (i) Each of the representations and warranties made
                  by the Borrower herein and in each other Loan Document shall
                  be true and correct in all material respects on and as of the
                  Effective Date as if made on and as of such date, both before
                  and after giving effect to the Loans requested to be made on
                  such date.

                           (ii) No Default or Event of Default shall have
                  occurred and be continuing on the Effective Date.

                  (o) Due  Diligence  Review. The Lenders shall be satisfied
                      ----------------------
          with the results of their due diligence review of the Borrower and
          its Subsidiaries.

                  (p) General and Refunding Mortgage Bond Documents. The
                      ---------------------------------------------
         Administrative Agent shall have received substantially final versions
         of the following documents (all as defined in the General and Refunding
         Mortgage Indenture) which, upon execution, delivery and filing, shall
         be sufficient for the issuance of the General and Refunding Mortgage
         Bonds required by Section 6.09(b): a supplemental indenture, an
         "Officer's Certificate" setting forth the terms of the General and
         Refunding Mortgage Bonds, a "Company Order" requesting authentication
         of the General and Refunding Mortgage Bonds by the trustee under the
         General and Refunding Mortgage Indenture, a form of the General and
         Refunding Mortgage Bond to be issued, a pledge agreement and forms of
         all legal opinions required to issue the General and Refunding Mortgage
         Bonds under the General and Refunding Mortgage Indenture. The forms of
         such documents, prior to their delivery to the Administrative Agent,
         shall have been approved by the trustee under the General and Refunding
         Mortgage Indenture and its counsel, but shall not be executed and
         delivered unless and until execution and delivery is required by
         Section 6.09(b).

                  (q) Termination of the Existing Credit Agreements. All
                      ---------------------------------------------
         principal, interest, fees, costs, expenses and other obligations of the
         Borrower under the Existing Credit Agreements shall have been (or will
         have been, upon the making of the initial Loans on the Effective Date
         and the application of the proceeds thereof) paid in full, and the
         "Commitments" under the Existing Credit Agreements shall have
         terminated in their entirety on or before such date.

                                     -40-

<PAGE>

                  (r) Additional Matters. The Administrative Agent shall have
                      ------------------
         received, with copies or executed counterparts for each Lender, such
         other certificates, opinions, documents and instruments as the
         Administrative Agent may have requested. All corporate and other
         proceedings, and all documents, instruments and other matters in
         connection with the transactions contemplated by this Agreement and the
         other Loan Documents, shall be satisfactory in form and substance to
         the Administrative Agent.

                  SECTION 4.02  Conditions to All Loans.
                                -----------------------

                  The obligation of each Lender to make, convert or continue any
Loan on the occasion of any Borrowing is subject to satisfaction of the
conditions precedent set forth in Section 4.01 and satisfaction of the following
further conditions precedent:

                  (a) Notice. The Borrower shall have executed and delivered to
                      ------
         the Administrative Agent a Borrowing Request or Interest Election
         Request for such Borrowing in accordance with Section 2.03 or 2.05, as
         the case may be.

                  (b) Representations and Warranties. Each of the
                      ------------------------------
         representations and warranties made by the Borrower herein and in each
         other Loan Document shall be true and correct in all material respects
         on and as of such date as if made on and as of such date, both before
         and after giving effect to the making, conversion or continuation of
         Loans requested to be made, converted or continued on such date.

                  (c) No Defaults. No Default or Event of Default shall have
                      -----------
         occurred and be continuing on such date or after giving effect to the
         making, conversion or continuation of Loans requested to be made,
         converted or continued on such date.

                  (d) No Violations of Law, etc. Neither the making, conversion
                      -------------------------
          or continuation of nor use of the Loans shall cause any Lender to
          violate or be in conflict with any Law.

                  (e) No Material Adverse Change. There shall not have
                      --------------------------
          occurred, or be threatened, any other event, act or condition which
          would reasonably be expected to have a Material Adverse Effect.

                  Each request by the Borrower for any Loan or conversion or
continuation thereof shall constitute a representation and warranty by the
Borrower that the conditions set forth in this Section 4.02 have been satisfied
as of the date of such request. Failure of the Administrative Agent to receive
notice from the Borrower to the contrary before such Loan is made shall
constitute a further representation and warranty by the Borrower that the
conditions referred to in this Section 4.02 have been satisfied as of the date
such Loan is made.

                                    ARTICLE V
                              AFFIRMATIVE COVENANTS

                  The Borrower hereby covenants to the Administrative Agent and
each Lender:

                                     -41-

<PAGE>

                  SECTION 5.01  Basic Reporting Requirements.
                                ----------------------------

                  (a) Annual Audit Reports. As soon as practicable, and in any
                      --------------------
event within 90 days after the close of each fiscal year of the Borrower, the
Borrower shall furnish to the Administrative Agent, with a copy for each Lender,
consolidated statements of income, retained earnings and cash flows of the
Borrower and its consolidated Subsidiaries for such fiscal year and a
consolidated balance sheet of the Borrower and its consolidated Subsidiaries as
of the close of such fiscal year, and notes to each, all in reasonable detail,
setting forth in comparative form the corresponding figures for the preceding
fiscal year. Such financial statements shall be accompanied by an opinion of
independent certified public accountants of recognized national standing
selected by the Borrower, which opinion shall not be subject to any
qualification as to scope of audit or as to any other matter which the Required
Lenders determine is adverse. Such opinion in any event shall contain a written
statement of such accountants substantially to the effect that (i) such
accountants examined such financial statements in accordance with generally
accepted auditing standards and accordingly made such tests of accounting
records and such other auditing procedures as such accountants considered
necessary in the circumstances and (ii) in the opinion of such accountants such
financial statements present fairly the financial position of the Borrower and
its consolidated Subsidiaries as of the end of such fiscal year and the results
of their operations and their retained earnings and cash flows for such fiscal
year, in conformity with GAAP.

                  (b) Quarterly Consolidated Reports. As soon as practicable,
                      ------------------------------
and in any event within 45 days after the close of each of the first three
fiscal quarters of each fiscal year of the Borrower, the Borrower shall furnish
to the Administrative Agent, with a copy for each Lender, unaudited consolidated
statements of income, retained earnings and cash flows of the Borrower and its
consolidated Subsidiaries for the period from the beginning of such fiscal year
to the end of such fiscal quarter and an unaudited consolidated balance sheet of
the Borrower and its consolidated Subsidiaries as of the close of such fiscal
quarter, and notes to each, all in reasonable detail, setting forth in
comparative form the corresponding figures for the same periods or as of the
same date during the preceding fiscal year (except for the consolidated balance
sheet, which shall set forth in comparative form the corresponding balance sheet
as of the prior fiscal year end). Such financial statements shall be certified
by a Responsible Officer of the Borrower as presenting fairly the financial
position of the Borrower and its consolidated Subsidiaries as of the end of such
fiscal quarter and the results of their operations and their retained earnings
and changes in cash flows for such fiscal year, in conformity with GAAP, subject
to normal and recurring year-end audit adjustments.

                  (c) Quarterly Compliance Certificates. The Borrower shall
                      ---------------------------------
deliver to the Administrative Agent, with a copy for each Lender, a Quarterly
Compliance Certificate in substantially the form set forth as Exhibit D, duly
completed and signed by a Responsible Officer of the Borrower concurrently with
the delivery of the financial statements referred to in subsections (a) and (b)
of this Section 5.01.

                  (d) Certain Other Reports and Information. Promptly upon their
                      -------------------------------------
becoming available to the Borrower, the Borrower shall (i) deliver to the
Administrative Agent, with a copy for each Lender, a copy of (A) all regular or
special reports, registration statements and amendments to the foregoing which
the Borrower or any Subsidiary of the Borrower shall file

                                     -42-

<PAGE>

with the Securities and Exchange Commission (or any successor thereto) or any
securities exchange and (B) all reports, proxy statements, financial statements
and other information distributed by the Borrower to its stockbrokers,
bondholders or the financial community generally, and (ii) if requested by the
Administrative Agent, deliver or otherwise make available to the Administrative
Agent a copy of each application and other document filed by the Borrower with
the Public Utilities Commission of Nevada with respect to the Borrower's
deferred energy rate case.

                  (e) Further Information. The Borrower shall promptly furnish
                      -------------------
to the Administrative Agent, with a copy for each Lender, such other information
and in such form as the Administrative Agent or any Lender may reasonably
request from time to time.

                  (f) Notice of Certain Events. Promptly (and, in the case of
                      ------------------------
clause (i) below, no later than two Business Days) upon becoming aware of any of
the following, the Borrower shall give the Administrative Agent notice thereof,
together with a written statement of a Responsible Officer of the Borrower
setting forth the details thereof and any action with respect thereto taken or
proposed to be taken by the Borrower:

                           (i)   Any Default or Event of Default.

                           (ii)  The occurrence or existence of any event or
         condition (including (A) the violation or alleged violation of any
         Environmental Law by the Borrower or any Subsidiary of the Borrower or
         the assertion of any Environmental Claim against the Borrower or any
         Subsidiary of the Borrower, (B) the commencement of any other action,
         suit, proceeding or investigation by or before any Governmental
         Authority against or affecting the Borrower or any Subsidiary of the
         Borrower, or (C) the violation, breach or default or alleged violation,
         breach or default by the Borrower or any Subsidiary of the Borrower or
         any other Person under any agreement or instrument material to the
         business, operations, condition (financial or otherwise) or prospects
         of the Borrower and its Subsidiaries taken as a whole) which event or
         condition, either individually or in the aggregate, has, or would
         reasonably be expected to have, a Material Adverse Effect.

                           (iii) Any change in the rating of the Index Debt
         of Borrower.

                  (g) Visitation; Verification. The Borrower shall permit such
                      ------------------------
Persons as the Administrative Agent or any Lender may designate from time to
time to visit and inspect any of the properties of the Borrower and of any of
its Subsidiaries, to examine their respective books and records and take copies
and extracts therefrom and to discuss their respective affairs with their
respective officers, employees and independent accountants at such times and as
often as the Administrative Agent or any Lender may reasonably request;
provided, however, that the Borrower reserves the right to restrict access to
--------  -------
any of its generating facilities in accordance with reasonably adopted practices
relating to safety and security. The Borrower hereby authorizes such officers,
employees and independent accountants to discuss with the Administrative Agent
or any Lender the affairs of the Borrower and its Subsidiaries.

                  (h) ERISA. Within 30 days after the Borrower knows that any of
                      -----
the events or conditions specified below with respect to any Plan or
Multiemployer Plan has occurred or

                                     -43-

<PAGE>

exists, a statement signed by a Responsible Officer of the Borrower setting
forth details respecting such event or condition and the action, if any, that
the Borrower or its ERISA Affiliate proposes to take with respect thereto (and
a copy of any report or notice required to be filed with or given to the PBGC
by the Borrower or an ERISA Affiliate with respect to such event or condition):

                           (i)   any Reportable Event and any request for a
         waiver under  Section 412(d)  of the Code for any Plan;

                           (ii)  the distribution under Section 4041 of ERISA of
         a notice of intent to terminate any Plan or any action taken by the
         Borrower or an ERISA Affiliate to terminate any Plan, in each case with
         respect to which there are insufficient assets to pay benefits as they
         become due;

                           (iii) the institution by the PBGC of proceedings
         under Section 4042 of ERISA for the termination of, or the appointment
         of a trustee to administer, any Plan, or the receipt by the Borrower or
         any ERISA Affiliate of a notice from a Multiemployer Plan that such
         action has been taken by the PBGC with respect to such Multiemployer
         Plan;

                           (iv)  the complete or partial withdrawal from a
         Multiemployer Plan by the Borrower or any ERISA Affiliate that results
         in liability under Section 4201 or 4204 of ERISA (including the
         obligation to satisfy secondary liability as a result of a purchaser
         default) or the receipt by the Borrower or any ERISA Affiliate of
         notice from a Multiemployer Plan that it is in reorganization or
         insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends
         to terminate or has terminated under Section 4041A of ERISA; and

                           (v)   the adoption of an amendment to any Plan that,
         pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA,
         would result in the loss of tax-exempt status of the trust of which
         such Plan is a part if the Borrower or an ERISA Affiliate fails to
         timely provide security to the Plan in accordance with the provisions
         of said Sections.

                  (i) Satisfaction of Certain Reporting Requirements.
                      ----------------------------------------------
Notwithstanding any other provision of this Section 5.01, the Borrower shall be
deemed to have satisfied its obligations pursuant to Sections 5.01(a) and (b) if
and to the extent that it shall have provided to the Administrative Agent and
each Lender, pursuant to Section 5.01(d), copies of its periodic reports (on
Form 10-K or 10-Q, as the case may be) as required to be filed with the
Securities and Exchange Commission (or any successor thereto) pursuant to the
Securities and Exchange Act of 1934, as amended (or any successor statute of
similar import), for the annual and quarterly periods described in such
Sections.

                  (j) Delivery to Lenders. The Administrative Agent shall
                      -------------------
promptly deliver to each Lender each of the reports, statements, certificates or
other documents delivered to the Administrative Agent by the Borrower pursuant
to this Section 5.01.

                                     -44-

<PAGE>

                  SECTION 5.02  Insurance.
                                ---------

                  The Borrower shall, and shall cause each of its Subsidiaries
to, maintain with financially sound and reputable insurers insurance with
respect to its properties and business and against such liabilities, casualties
and contingencies and of such types and in such amounts as is customary in the
case of corporations engaged in the same or similar businesses or having similar
properties similarly situated and as is satisfactory from time to time to the
Required Lenders in their reasonable discretion.

                  SECTION 5.03  Payment of Taxes and Other Potential Charges and
                                ------------------------------------------------
Priority Claims.
---------------

                  The Borrower shall, and shall cause each of its Subsidiaries
to, pay or discharge

                  (a) on or prior to the date on which penalties or Liens
         attach thereto, all Taxes imposed upon it or any of its Properties;

                  (b) on or prior to the date when due, all lawful claims of
         materialmen, mechanics, carriers, warehousemen, landlords and other
         like Persons which, if unpaid, might result in the creation of a Lien
         upon any such Property; and

                  (c) on or prior to the date when due, all other lawful claims
         which, if unpaid, might result in the creation of a Lien upon any such
         Property or which, if unpaid, might give rise to a claim entitled to
         priority over general creditors of the Borrower or such Subsidiary in a
         case under the Bankruptcy Code;

provided, that, unless and until foreclosure, distraint, levy, sale or similar
--------
proceedings shall have been commenced, the Borrower or such Subsidiary need not
pay or discharge any such Tax, assessment, charge or claim so long as (x) the
validity thereof is contested in good faith and by appropriate proceedings
diligently conducted, and (y) such reserves or other appropriate provisions as
may be required by GAAP shall have been made therefor.

                  SECTION 5.04  Preservation of Corporate Status and Franchises.
                                -----------------------------------------------

                  The Borrower shall, and shall cause each of its Subsidiaries
to, maintain its status as a corporation, trust or limited liability company
duly organized, validly existing and in good standing under the Laws of its
jurisdiction of organization, and to be duly qualified to do business as a
foreign corporation, trust or limited liability company and in good standing in
all jurisdictions in which the ownership of its properties or the nature of its
business or both make such qualification necessary or advisable; provided,
                                                                 --------
however, that nothing in this Section 5.04 shall prevent the withdrawal by the
-------
Borrower or any of its Subsidiaries of its qualification as a foreign
corporation in any jurisdiction where such withdrawal could not have a Material
Adverse Effect. The Borrower shall, and shall cause each of its Subsidiaries to,
do or cause to be done all things necessary to preserve and keep in full force
and effect its material rights, franchises, licenses and patents.

                                     -45-

<PAGE>

                  SECTION 5.05  Governmental Approvals and Filings.
                                ----------------------------------

                  The Borrower shall keep and maintain in full force and effect
all Governmental Actions necessary or advisable in connection with execution and
delivery of any Loan Document, consummation of the transactions herein or
therein contemplated, performance of or compliance with the terms and conditions
hereof or thereof or to ensure the legality, validity, binding effect or
enforceability hereof or thereof.

                  SECTION 5.06  Maintenance of Properties.
                                -------------------------

                  The Borrower shall, and shall cause each of its Subsidiaries
to, maintain or cause to be maintained in good repair, working order and
condition the properties now or hereafter owned, leased or otherwise possessed
by it and shall make or cause to be made all needful and proper repairs,
renewals, replacements and improvements thereto so that the business carried on
in connection therewith may be properly and advantageously conducted at all
times.

                  SECTION 5.07  Avoidance of Other Conflicts.
                                ----------------------------

                  The Borrower shall not, and shall not permit any of its
Subsidiaries to, violate or conflict with, be in violation of or in conflict
with, or be or remain subject to any liability (contingent or otherwise) on
account of any violation or conflict with:

                  (a) any Law;

                  (b) its articles of incorporation or by-laws; or

                  (c) any agreement or  instrument  to which it or any of its
         Subsidiaries is a party or by which any of them or any of their
         respective properties (now owned or hereafter  acquired) may be subject
         or bound,

except for matters which would not reasonably be expected, either individually
or in the aggregate, to have a Material Adverse Effect.

                  SECTION 5.08  Financial Accounting Practices.
                                ------------------------------

                  The Borrower shall, and shall cause each of its Subsidiaries
to, make and keep books, records and accounts which, in reasonable detail,
accurately and fairly reflect its transactions and dispositions of its assets
and maintain a system of internal accounting controls sufficient to provide
reasonable assurances that (a) transactions are executed in accordance with
management's general or specific authorization, (b) transactions are recorded as
necessary (i) to permit preparation of financial statements in conformity with
GAAP and (ii) to maintain accountability for assets, (c) access to assets is
permitted only in accordance with management's general or specific authorization
and (d) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect to
any differences.

                                     -46-

<PAGE>

                  SECTION 5.09  Use of Proceeds.
                                ---------------

                  The Borrower shall apply the proceeds of all Loans hereunder
only for working capital and general corporate purposes of the Borrower,
including commercial paper backup. The Borrower shall not use the proceeds of
any Loans hereunder directly or indirectly for any unlawful purpose, in any
manner inconsistent with Section 3.11, or inconsistent with any other provision
of any Loan Document.

                  SECTION 5.10  End of Fiscal Periods.
                                ---------------------

                  The Borrower shall cause (a) each of its, and each of its
Subsidiary's, fiscal years to end on December 31 and (b) each of its, and each
of its Subsidiary's, fiscal quarters to end on March 31, June 30, September 30
and December 31.

                                   ARTICLE VI
                               NEGATIVE COVENANTS

                  The Borrower hereby covenants to the Administrative Agent and
each Lender as follows:

                  SECTION 6.01  Financial Covenants.
                                -------------------

                  (a)      Maximum  Leverage.  The Borrower shall not permit the
                           -----------------
ratio of (a) Total Indebtedness to (b) the sum of Total Indebtedness and
Shareholders' Equity, determined as of the last day of each fiscal quarter, to
exceed 0.60 to 1.

                  (b)      Consolidated Interest Coverage Ratio. The Borrower
                           ------------------------------------
shall not permit the Consolidated Interest Coverage Ratio, determined as of the
last day of each fiscal quarter set forth below for the period set forth below,
to be less than 2.0 to 1:

                  Fiscal Quarter Ended               Period
                  --------------------               ------

                  December 31, 2001                  the three  consecutive
                                                     fiscal  quarters  ended as
                                                     of the last day of such
                                                     fiscal quarter

                  March 31, 2002 and each            the four consecutive fiscal
                  fiscal quarter ended thereafter    quarters ended as of the
                                                     last day of such fiscal
                                                     quarter

                  SECTION 6.02  Liens.
                                -----

                  The Borrower shall not, and shall not permit any of its
Subsidiaries to, at any time create, incur, assume or suffer to exist any Lien
on any of its Property (now owned or hereafter acquired), or agree, become or
remain liable (contingently or otherwise) to do any of the foregoing, except for
the following ("Permitted Liens"):
                ---------------

                  (a)      Liens  existing  on the  date  hereof  and  securing
         obligations  existing  on the date hereof, as such Liens and
         obligations are listed on Schedule IV;

                                     -47-

<PAGE>

                  (b) Liens securing obligations issued under and pursuant to
         the terms and conditions of either (i) the First Mortgage Indenture or
         (ii) the General and Refunding Mortgage Indenture; provided that the
                                                            --------
         Borrower shall at all times (unless and until General and Refunding
         Mortgage Bonds are issued pursuant to Section 6.09(b)) maintain
         sufficient capacity pursuant to the General and Refunding Mortgage
         Indenture to issue additional General and Refunding Mortgage Bonds in
         an aggregate principal amount equal to or greater than the aggregate
         amount of the Lenders' Commitments hereunder;

                  (c) Liens on First Mortgage Bonds issued as collateral for
         pollution control or gas or water facility revenue bonds issued for the
         benefit of the Borrower or its Subsidiaries (and related rights and
         interests) to secure obligations of the Borrower or such Subsidiaries
         for the benefit of the holders of such bonds, provided that such bonds
                                                       --------
         are not secured by any other assets or Properties of the Borrower or
         its Subsidiaries;

                  (d) Liens arising from taxes, assessments, charges or claims
         described in Section 5.03 that are not yet due or that remain payable
         without penalty or to the extent permitted to remain unpaid under the
         proviso to such Section 5.03;

                  (e) Deposits or pledges of cash or securities in the ordinary
         course of business to secure (i) worker's compensation, unemployment
         insurance or other social security obligations, (ii) performance of
         bids, tenders, trade contracts (other than for payment of money) or
         leases, (iii) stay, surety or appeal bonds, or (iv) other obligations
         of a like nature incurred in the ordinary course of business;

                  (f) Zoning restrictions, easements, minor restrictions on the
         use of real Property, minor irregularities in title thereto and other
         minor Liens that do not secure the payment of money or the performance
         of an obligation and that do not in the aggregate materially detract
         from the value of an asset to, or materially impair its use in the
         business of, the Borrower or such Subsidiary; and

                  (g) Liens on Property securing all or part of the purchase
         price thereof and Liens (whether or not assumed) existing in Property
         at the time of purchase thereof, provided that: (i) such Lien is
                                          --------
         created before or substantially simultaneously with the purchase of
         such Property by the Borrower or such Subsidiary, (ii) such Lien is
         confined solely to the Property so purchased, improvements thereto and
         proceeds thereof, (iii) the aggregate amount secured by such Liens on
         any particular Property at the time purchased by the Borrower or such
         Subsidiary, as the case may be, shall not exceed the lesser of the
         purchase price of such Property and the fair market value of such
         Property at the time of purchase thereof by the Borrower or such
         Subsidiary, and (iv) the aggregate amount secured by all Liens
         described in this Section 6.02(g) shall not at any time exceed
         $50,000,000.

"Permitted Liens" shall in no event include any Lien imposed by, or required to
be granted pursuant to, ERISA or any Environmental Law.

                                     -48-

<PAGE>

                  SECTION 6.03  Mergers.
                                -------

                  The Borrower shall not, and shall not permit any of its
Subsidiaries to, (a) merge with or into or consolidate with any other Person,
(b) liquidate, wind-up, dissolve or divide, or (c) agree, become or remain
liable (contingently or otherwise) to do any of the foregoing, except that:

                           (i) A Person may merge with or into or consolidate
                  with any Subsidiary of the Borrower; provided that (x) the
                                                       --------
                  surviving Person shall be a Subsidiary of the Borrower, (y) no
                  Default or Event of Default shall have occurred and be
                  continuing or shall exist at such time or after giving effect
                  to such transaction and (z) the Borrower shall deliver to the
                  Administrative Agent (A) a certificate, in a form reasonably
                  satisfactory to the Administrative Agent, certifying that no
                  Default or Event of Default exists or will result from such
                  merger and (B) pro forma financial statements in support of
                  such certification; and

                           (ii) A Person may merge with or into or consolidate
                  with the Borrower, provided that (x) the Borrower shall be the
                                     --------
                  surviving Person, (y) no Default or Event of Default shall
                  have occurred and be continuing or shall exist at such time or
                  after giving effect to such transaction and (z) the Borrower
                  shall deliver to the Administrative Agent (A) a certificate,
                  in a form reasonably satisfactory to the Administrative Agent,
                  certifying that no Default or Event of Default exists or will
                  result from such merger and (B) pro forma financial statements
                  in support of such certification.

                  SECTION 6.04  Dispositions of Properties.
                                --------------------------

                  The Borrower shall not, and shall not permit any of its
Subsidiaries to, sell, convey, assign, lease, sale-leaseback, transfer, abandon
or otherwise dispose of, voluntarily or involuntarily (collectively, "Dispose"),
                                                                      -------
any of its Properties, or agree, become or remain liable contingently or
otherwise to do any of the foregoing, except that, so long as no Default or
Event of Default shall have occurred and be continuing or shall exist at such
time or after giving effect to such transaction, the Borrower and its
Subsidiaries may Dispose of Property (a) in transactions in the ordinary course
of business consistent with past practice, (b) that is obsolete, (c) comprising
accounts receivable transferred from time to time on a revolving basis to a
commercial paper conduit, special purpose subsidiary or similar entity; provided
                                                                        --------
that (i) the aggregate face amount of such accounts receivable Disposed of in
reliance on this clause (c) does not exceed $125,000,000 at any one time
outstanding and (ii) the net cash proceeds from each Disposition of such
accounts receivable, (A) when added to the net cash proceeds of all other
Dispositions of accounts receivable made in reliance on this clause (c), are not
less than 80% of the aggregate face amount of all accounts receivable Disposed
of in reliance on this clause (c) and (B) at the time of such Disposition, do
not exceed the sum of (I) the balance of the Borrower's deferred energy accrual
account at such time and (II) the Borrower's deferred energy costs actually
incurred but not yet reflected in the Borrower's deferred energy accrual
account, in each case as set forth in the Borrower's books and records;
provided, further, that each Disposition made by the Borrower in reliance on
--------  -------
this clause (c) shall constitute a representation

                                     -49-

<PAGE>

and warranty of the Borrower, made at the time of such Disposition, that the
conditions set forth in clauses (i) and (ii) above are satisfied at such time,
and (d) in transactions other than as provided in Section 6.04(a), (b) and (c);
provided that the aggregate book value of all Property Disposed of pursuant to
--------
this Section 6.04(d) from and after the date hereof shall not exceed
$50,000,000.

                  SECTION 6.05  Investments and Acquisitions.
                                ----------------------------

                  Prior to the making of any Investment or the consummation of
any Acquisition by the Borrower or any of its Subsidiaries, the amount or
purchase price of which, as the case may be, when aggregated with the amounts
and purchase prices of other Investments and Acquisitions made by the Borrower
and its Subsidiaries, would exceed $10,000,000 in the aggregate at any time, the
Borrower shall deliver to the Administrative Agent (i) a certificate, in a form
reasonably satisfactory to the Administrative Agent, certifying that no Default
or Event of Default exists or will result from such Acquisition and (ii) pro
forma financial statements in support of such certification.

                  SECTION 6.06  Dividends and Stock Repurchases.
                                -------------------------------

                  The Borrower shall not declare or pay any dividend on its
capital stock (except for dividends in the form of capital stock), or redeem or
repurchase any of its capital stock, if a Default or Event of Default shall have
occurred and be continuing or shall exist at such time or after giving effect to
such transaction; provided, however, that the Borrower may at any time during
                  --------  -------
the continuance of a Default or an Event of Default pay cash dividends to, or
redeem or repurchase for cash any of its capital stock from, Sierra Pacific
Resources, but only if and to the extent that Sierra Pacific Resources
immediately applies such cash to the payment of the Obligations (as such term is
defined in the SPR Credit Agreement).

                  SECTION 6.07 Transactions with Affiliates.
                               ----------------------------

                  The Borrower shall not enter into any transaction of any kind
with any Person that Controls the Borrower or is Controlled by the Borrower or
is under common Control with the Borrower other than (a) salary, bonus, employee
stock option and other compensation arrangements with directors or officers in
the ordinary course of business, (b) transactions that are fully disclosed to
the board of directors (or executive committee thereof) of the Borrower and
expressly authorized by a resolution of the board of directors (or executive
committee) of the Borrower which is approved by a majority of the directors (or
executive committee) not having an interest in the transaction, (c) transactions
between or among the Borrower and its Wholly-Owned Subsidiaries, (d)
transactions between the Borrower and its Subsidiaries, on the one hand, and
SPPC and its Subsidiaries, on the other hand, and (e) transactions on overall
terms at least as favorable to the Borrower as would be the case in an arm's-
length transaction between unrelated parties of equal bargaining power.

                  SECTION 6.08  Change of Business.
                                ------------------

                  The Borrower shall not engage in any business other than the
businesses of (a) the generation or purchase of electrical power and (b) the
purchase of natural gas, and in each case the transmission and distribution
thereof to industrial, commercial and residential customers. In

                                     -50-

<PAGE>

addition to, and not by way of limitation of, the previous sentence, the
Borrower shall maintain ongoing business segments (as defined in FASB Statement
131 - Disclosure about Segments of an Enterprise and Related Information)
consisting of electricity and gas assets (exclusive of cash and readily
marketable securities) and operating income reflected in the financial
statements of the Borrower as being directly attributable to the generation,
transmission and/or distribution of electricity or gas, which segments and
operating income shall, in the aggregate, comprise not less than 80% of the
consolidated assets (exclusive of cash and readily marketable securities) of
the Borrower and its Subsidiaries.

                  SECTION 6.09  Equal and Ratable Lien; Grant of Security
                                -----------------------------------------
Interest in Certain Events.
--------------------------

                  (a) If, notwithstanding the prohibition contained in Section
6.02, the Borrower or any of its Subsidiaries is subjected to any Lien upon any
of its Property, other than those permitted by the provisions of Section 6.02,
the Borrower will, and will cause its Subsidiaries to, make or cause to be made
effective provisions whereby the Borrowings will be secured equally and ratably
with any and all other obligations thereby secured, such security to be pursuant
to agreements reasonably satisfactory to the Administrative Agent and, in any
such case, the Borrowings shall have the benefit, to the fullest extent that,
and with such priority as, the Lenders may be entitled under applicable law, of
an equitable Lien on such Property. Such violation of Section 6.02 will
constitute an Event of Default, whether or not provision is made for an equal
and ratable Lien pursuant to this Section 6.09, and no such Lien or agreements
with respect thereto shall be deemed to be a waiver of or consent to such Event
of Default by the Administrative Agent or any Lender.

                  (b) If any of the following (each, a "Triggering Event")
                                                        ----------------
shall occur:

                      (x) Moody's shall rate the Index Debt of Borrower as Baa3
or lower; or

                      (y) S&P shall rate the Index Debt of Borrower as BB+ or
lower;

then the Borrower shall issue or cause to be issued, not later than five (5)
Business Days after the date on which the Triggering Event first occurs, for the
ratable benefit of the Lenders, General and Refunding Mortgage Bonds, to the
full extent permitted under applicable orders of the Public Utilities Commission
of Nevada and the General and Refunding Mortgage Indenture, in an aggregate face
amount equal to the aggregate amount of the Commitments (but with an aggregate
outstanding principal amount equal to the amount of principal of the Loans
outstanding from time to time), with interest and other terms and conditions
substantially similar to the Loans, and the Borrower shall perform or cause to
be performed all acts, and execute or cause to be executed all resolutions,
orders, instruments, certificates, agreements and other documents required under
the General and Refunding Mortgage Indenture (including the documents referred
to in Section 4.01(p)) to give effect to the foregoing within such five-Business
Day period.

                                     -51-

<PAGE>

                  SECTION 6.10  Restrictive Agreements.
                                ----------------------

                  Except for agreements referenced in or permitted under this
Article VI, the Borrower will not, and will not permit any of its Subsidiaries
to, directly or indirectly, enter into, incur or permit to exist any agreement
or other arrangement that prohibits, restricts or imposes any condition upon (a)
the ability of the Borrower or any of its Subsidiaries to create, incur or
permit to exist any Lien upon any of its Property or assets, or (b) the ability
of any Subsidiary of the Borrower to pay dividends or other distributions with
respect to any shares of its capital stock or to make or repay loans or advances
to the Borrower or any other Subsidiary of the Borrower or to guarantee
Indebtedness of the Borrower or any other Subsidiary of the Borrower.

                                   ARTICLE VII
                                    DEFAULTS

                  SECTION 7.01  Events of Default.
                                -----------------

                  An "Event of Default" shall mean the occurrence or existence
                      ----------------
of one or more of the following events or conditions (for any reason, whether
voluntary, involuntary or effected or required by Law):

                  (a) The Borrower shall fail to pay when due principal of any
         Loan.

                  (b) The Borrower shall fail to pay when due interest on any
         Loan, any fees, indemnity or expenses, or any other amount due
         hereunder or under any other Loan Document and such failure shall have
         continued for a period of three (3) Business Days.

                  (c) Any representation or warranty made or deemed made by the
         Borrower in or pursuant to or in connection with any Loan Document, or
         any statement made by the Borrower in any financial statement,
         certificate, report, exhibit or document furnished by the Borrower to
         the Administrative Agent or any Lender pursuant to or in connection
         with any Loan Document, shall prove to have been false or misleading in
         any material respect as of the time when made or deemed made (including
         by omission of material information necessary to make such
         representation, warranty or statement not misleading).

                  (d) The Borrower shall default in the performance or
         observance of any covenant contained in Article VI or any of the
         covenants contained in Section 5.01(f)(i), 5.09 or 5.10.

                  (e) The Borrower shall default in the performance or
         observance of any other covenant, agreement or duty under this
         Agreement or any other Loan Document and (i) in the case of a default
         under Section 5.01 (other than as referred to in subsection (f)(i)
         thereof) such default shall have continued for a period of ten (10)
         Business Days and (ii) in the case of any other default such default
         shall have continued for a period of 30 days after notice from the
         Administrative Agent to the Borrower.

                  (f) The Borrower or any Subsidiary of the Borrower shall (i)
         fail to make any payment (x) on account of any Indebtedness aggregating
         $10,000,000 or more in

                                     -52-

<PAGE>

         principal amount or (y) aggregating $10,000,000 or more on any
         Indebtedness, or any interest or premium thereon, in each case, when
         due (whether by scheduled maturity, required prepayment, acceleration,
         demand or otherwise), and, in each case, such failure shall have
         continued beyond any applicable grace period specified in any
         agreement or instrument relating to such Indebtedness, or (ii) fail to
         perform or observe any other term, covenant or condition on its part
         to be performed or observed under any agreement or instrument relating
         to any Indebtedness when required to be performed or observed, and
         such failure shall have continued beyond any applicable grace period
         specified in any agreement or instrument relating to such
         Indebtedness, if the effect of such failure to perform or observe is
         to accelerate, or to permit the acceleration of, the maturity of such
         Indebtedness, the unpaid principal amount of which then aggregates
         $10,000,000 or more.

                  (g) One or more final judgments or orders for the payment of
         money shall have been entered against the Borrower or any Subsidiary of
         the Borrower, which judgments or orders exceed $10,000,000 in the
         aggregate, and such judgments or orders shall have remained
         undischarged and unstayed for a period of thirty (30) consecutive days.

                  (h) One or more writs or warrants of attachment, garnishment,
         execution, distraint or similar process exceeding in value the
         aggregate amount of $10,000,000 shall have been issued against the
         Borrower or any Subsidiary of the Borrower or any of their respective
         properties and shall have remained undischarged and unstayed for a
         period of thirty (30) consecutive days.

                  (i) Any Governmental Action now or hereafter made by or with
         any Governmental Authority in connection with any Loan Document is not
         obtained or shall have ceased to be in full force and effect or shall
         have been modified or amended or shall have been held to be illegal or
         invalid, and the Required Lenders shall have determined (which
         determination shall be conclusive provided it is reached in good faith)
         that the consequence of any of the foregoing events would reasonably be
         expected to have, individually or in the aggregate, a Material Adverse
         Effect.

                  (j) Any Loan Document or any material term or provision
         thereof shall have ceased to be in full force and effect, or the
         Borrower or any Governmental Authority with jurisdiction over the
         Borrower shall, or shall purport to, terminate, repudiate, declare
         voidable or void or otherwise contest, any Loan Document or any
         material term or provision thereof or any obligation or liability of
         the Borrower thereunder.

                  (k) An event or condition specified in Section 5.01(h) hereof
         shall occur or exist with respect to any Plan or Multiemployer Plan or
         any Lien arises pursuant to ERISA and, as a result of such event or
         condition or Lien, together with all other such events or conditions or
         Liens, the Borrower or any ERISA Affiliate shall incur or shall be
         reasonably likely to incur a liability to a Plan, a Multiemployer Plan
         or the PBGC or suffer an encumbrance to exist in favor of any thereof
         (or any combination of the foregoing) which would constitute a Material
         Adverse Effect.

                                     -53-

<PAGE>

                  (l) The Borrower or any Subsidiary of the Borrower shall have
         violated any Environmental Law or become subject to any Environmental
         Claim and, in either case, the Required Lenders shall have determined
         (which determination shall be conclusive provided it is reached in good
         faith) that such event would reasonably be expected, either
         individually or in the aggregate, to have a Material Adverse Effect.

                  (m)      A proceeding  shall have been  instituted  in respect
         of the Borrower or any  Subsidiary of the Borrower:

                           (i) seeking to have an order for relief entered in
                  respect of such Person, or seeking a declaration or entailing
                  a finding that such Person is insolvent or a similar
                  declaration or finding, or seeking dissolution, winding-up,
                  charter revocation or forfeiture, liquidation, reorganization,
                  arrangement, adjustment, composition or other similar relief
                  with respect to such Person, its assets or its debts under any
                  Law relating to bankruptcy, insolvency, relief of debtors or
                  protection of creditors, termination of legal entities or any
                  other similar Law now or hereafter in effect, or

                           (ii)     seeking appointment of a receiver, trustee,
                  liquidator, assignee, sequestrator or other custodian for such
                  Person or for all or any substantial part of its Property,

         and such proceeding shall result in the entry, making or grant of any
         such order for relief, declaration, finding, relief or appointment, or
         such proceeding shall remain undismissed and unstayed for a period of
         thirty (30) consecutive days.

                  (n) The Borrower or any Subsidiary of the Borrower shall
         become insolvent; shall fail to pay, become unable to pay, or state
         that it is or will be unable to pay, its debts as they become due;
         shall voluntarily suspend transaction of its business; shall make a
         general assignment for the benefit of creditors; shall institute (or
         fail to controvert in a timely and appropriate manner) a proceeding
         described in Section 7.01(m)(i), or (whether or not any such proceeding
         has been instituted) shall consent to or acquiesce in any such order
         for relief, declaration, finding or relief described therein; shall
         institute (or fail to controvert in a timely and appropriate manner) a
         proceeding described in Section 7.01(m)(ii), or (whether or not any
         such proceeding has been instituted) shall consent to or acquiesce in
         any such appointment or to the taking of possession by any such
         custodian of all or any substantial part of its Property; shall
         dissolve, wind-up, revoke or forfeit its charter (or other constituent
         documents) or liquidate itself or any substantial part of its Property;
         or shall take any action in furtherance of any of the foregoing.

                  (o)      A Change in Control shall occur.

                  SECTION 7.02 Consequences of an Event of Default.
                               -----------------------------------

                  (a) If an Event of Default specified in Section 7.01 (other
than subsections (m) and (n) thereof) shall occur and be continuing or shall
exist, then, in addition to all other rights and remedies which the
Administrative Agent or any Lender may have hereunder

                                     -54-

<PAGE>

or under any other Loan Document, at law, in equity or otherwise, the Lenders
shall be under no further obligation to make Loans hereunder, and the
Administrative Agent may, and, upon the written request of the Required Lenders
shall, by notice to the Borrower, from time to time do any or all of the
following:

                           (i) Declare the Commitments terminated, whereupon the
         Commitments will terminate and any fees hereunder shall be immediately
         due and payable without presentment, demand, protest or further notice
         of any kind, all of which are hereby waived, and an action therefor
         shall immediately accrue.

                           (ii) Declare the unpaid principal amount of the
         Loans, interest accrued thereon and all other Obligations to be
         immediately due and payable without presentment, demand, protest or
         further notice of any kind, all of which are hereby waived, and an
         action therefor shall immediately accrue.

                  (b) If an Event of Default specified in subsection (m) or (n)
of Section 7.01 shall occur or exist, then, in addition to all other rights and
remedies which the Administrative Agent or any Lender may have hereunder or
under any other Loan Document, at law, in equity or otherwise, the Commitments
shall automatically terminate and the Lenders shall be under no further
obligation to make Loans, and the unpaid principal amount of the Loans, interest
accrued thereon and all other Obligations shall become immediately due and
payable without presentment, demand, protest or notice of any kind, all of which
are hereby waived, and an action therefor shall immediately accrue.

                                  ARTICLE VIII
                                   THE AGENTS

                  SECTION 8.01  Appointment.
                                -----------

                  Each Lender hereby irrevocably appoints Union Bank of
California, N.A. to act as Administrative Agent for such Lender under this
Agreement and the other Loan Documents. Each Lender hereby irrevocably
authorizes the Administrative Agent to take such action on behalf of such Lender
under the provisions of this Agreement and the other Loan Documents, and to
exercise such powers and to perform such duties, as are expressly delegated to
or required of the Administrative Agent by the terms hereof or thereof, together
with such powers as are reasonably incidental thereto. Union Bank of California,
N.A. hereby agrees to act as Administrative Agent on behalf of the Lenders on
the terms and conditions set forth in this Agreement and the other Loan
Documents, subject to its right to resign as provided in Section 8.10. Each
Lender hereby irrevocably authorizes the Administrative Agent to execute and
deliver each of the Loan Documents executed after the date hereof and to accept
delivery of such of the other Loan Documents delivered after the date hereof as
may not require execution by the Administrative Agent (with such consents of the
Lenders as required pursuant to Section 9.01). Each Lender agrees that the
rights and remedies granted to the Administrative Agent under the Loan Documents
shall be exercised exclusively by the Administrative Agent, and that no Lender
shall have any right individually to exercise any such right or remedy, except
to the extent expressly provided herein or therein.

                                     -55-

<PAGE>

                  SECTION 8.02  General Nature of Administrative Agent's Duties.
                                -----------------------------------------------

                  Notwithstanding anything to the contrary elsewhere in this
Agreement or in any other Loan Document:

                  (a) The Administrative Agent shall have no duties or
         responsibilities except those expressly set forth in this Agreement and
         the other Loan Documents, and no implied duties or responsibilities on
         the part of the Administrative Agent shall be read into this Agreement
         or any other Loan Document or shall otherwise exist.

                  (b) The duties and responsibilities of the Administrative
         Agent under this Agreement and the other Loan Documents shall be
         mechanical and administrative in nature, and the Administrative Agent
         shall not have a fiduciary relationship in respect of any Lender.

                  (c) The Administrative Agent is and shall be solely the agent
         of the Lenders. The Administrative Agent does not assume, and shall not
         at any time be deemed to have, any relationship of agency or trust with
         or for, or any other duty or responsibility to, the Borrower or any
         other Person (except only for its relationship as agent for, and its
         express duties and responsibilities to, the Lenders as provided in this
         Agreement and the other Loan Documents).

                  (d) The Administrative Agent shall be under no obligation to
         take any action hereunder or under any other Loan Document if the
         Administrative Agent believes in good faith that taking such action may
         conflict with any Law or any provision of this Agreement or any other
         Loan Document, or may require the Administrative Agent to qualify to do
         business in any jurisdiction where it is not then so qualified.

                  SECTION 8.03  Exercise of Powers.
                                ------------------

                  The Administrative Agent shall take any action of the type
specified in this Agreement or any other Loan Document as being within the
Administrative Agent's rights, powers or discretion in accordance with
directions from the Required Lenders (or, to the extent this Agreement or such
other Loan Document expressly requires the direction or consent of some other
Person or set of Persons, then instead in accordance with the directions of such
other Person or set of Persons). In the absence of such directions, the
Administrative Agent shall have the authority (but under no circumstances shall
be obligated), in its sole discretion, to take any such action, except to the
extent that this Agreement or such other Loan Document expressly requires the
direction or consent of the Required Lenders (or some other Person or set of
Persons), in which case the Administrative Agent shall not take such action
absent such direction or consent. Any action or inaction pursuant to such
direction, discretion or consent shall be binding on all the Lenders. The
Administrative Agent shall not have any liability to any Person as a result of
(a) the Administrative Agent acting or refraining from acting in accordance with
the directions of the Required Lenders (or other applicable Person or set of
Persons), (b) the Administrative Agent refraining from acting in the absence of
instructions to act from the Required Lenders (or other applicable Person or set
of Persons), whether or not the Administrative Agent has discretionary power to
take such action, or (c) the Administrative

                                     -56-

<PAGE>

Agent taking discretionary action it is authorized to take under this Section
(subject, in the case of clauses (b) and (c), to the provisions of Section
8.04(a)).

                  SECTION 8.04  General Exculpatory Provisions.
                                ------------------------------

                  Notwithstanding anything to the contrary elsewhere in this
Agreement or any other Loan Document:

                  (a) The Administrative Agent shall not be liable for any
         action taken or omitted to be taken by it under or in connection with
         this Agreement or any other Loan Document, unless caused by its own
         gross negligence or willful misconduct.

                  (b) The Administrative Agent shall not be responsible for (i)
         the execution, delivery, effectiveness, enforceability, genuineness,
         validity or adequacy of this Agreement or any other Loan Document, (ii)
         any recital, representation, warranty, document, certificate, report or
         statement in, provided for in, or received under or in connection with,
         this Agreement or any other Loan Document, (iii) any failure of the
         Borrower or any Lender to perform any of their respective obligations
         under this Agreement or any other Loan Document, or (iv) the existence,
         validity, enforceability, perfection, recordation, priority, adequacy
         or value, now or hereafter, of any Lien or other direct or indirect
         security afforded or purported to be afforded by any of the Loan
         Documents or otherwise from time to time.

                  (c) The Administrative Agent shall not be under any obligation
         to ascertain, inquire or give any notice relating to (i) the
         performance or observance of any of the terms or conditions of this
         Agreement or any other Loan Document on the part of the Borrower, (ii)
         the business, operations, condition (financial or otherwise) or
         prospects of the Borrower or any other Person, or (iii) except to the
         extent set forth in Section 8.05(f), the existence of any Default or
         Event of Default.

                  (d) The Administrative Agent shall not be under any
         obligation, either initially or on a continuing basis, to provide any
         Lender with any notices, reports or information of any nature, whether
         in its possession presently or hereafter, except for such notices,
         reports and other information expressly required by this Agreement or
         any other Loan Document to be furnished by the Administrative Agent to
         such Lender.

                  SECTION 8.05 Administration by the Administrative Agent.
                               ------------------------------------------

                  (a) The Administrative Agent may rely upon any notice or other
communication of any nature (written or oral, including but not limited to
telephone conversations, whether or not such notice or other communication is
made in a manner permitted or required by this Agreement or any other Loan
Document) purportedly made by or on behalf of the proper party or parties, and
the Administrative Agent shall not have any duty to verify the identity or
authority of any Person giving such notice or other communication.

                  (b) The Administrative Agent may consult with legal counsel
(including, without limitation, in-house counsel for the Administrative Agent or
in-house or other counsel for the Borrower), independent public accountants and
any other experts selected by it from time

                                     -57-

<PAGE>

to time, and the Administrative Agent shall not be liable for any action taken
or omitted to be taken in good faith by it in accordance with the advice of
such counsel, accountants or experts.

                  (c) The Administrative Agent may conclusively rely upon the
truth of the statements and the correctness of the opinions expressed in any
certificates or opinions furnished to the Administrative Agent in accordance
with the requirements of this Agreement or any other Loan Document. Whenever the
Administrative Agent shall deem it necessary or desirable that a matter be
proved or established with respect to the Borrower or any Lender, such matter
may be established by a certificate of the Borrower or such Lender, as the case
may be, and the Administrative Agent may conclusively rely upon such certificate
(unless other evidence with respect to such matter is specifically prescribed in
this Agreement or another Loan Document).

                  (d) The Administrative Agent may fail or refuse to take any
action unless it shall be indemnified to its satisfaction from time to time
against any and all amounts, liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature which may be imposed on, incurred by or asserted against the
Administrative Agent by reason of taking or continuing to take any such action.

                  (e) The Administrative Agent may perform any of its duties
under this Agreement or any other Loan Document by or through agents or
attorneys-in-fact. The Administrative Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.

                  (f) The Administrative Agent shall not be deemed to have any
knowledge or notice of the occurrence of any Default or Event of Default unless
the Administrative Agent has received notice from a Lender or the Borrower
referring to this Agreement, describing such Default or Event of Default, and
stating that such notice is a "notice of default". If the Administrative Agent
receives such a notice, the Administrative Agent shall give prompt notice
thereof to each Lender.

                  SECTION 8.06  Lenders Not Relying on Administrative Agent or
                                ----------------------------------------------
Other Lenders.
-------------

                  Each Lender acknowledges as follows:

                  (a) Neither the Administrative Agent nor any other Lender has
         made any representations or warranties to it, and no act taken
         hereafter by the Administrative Agent or any other Lender shall be
         deemed to constitute any representation or warranty by the
         Administrative Agent or such other Lender to it.

                  (b) It has, independently and without reliance upon the
         Administrative Agent or any other Lender, and based upon such documents
         and information as it has deemed appropriate, made its own credit and
         legal analysis and decision to enter into this Agreement and the other
         Loan Documents.

                  (c) It will, independently and without reliance upon the
         Administrative Agent or any other Lender, and based upon such documents
         and information as it shall deem appropriate at the time, make its own
         decisions to take or not take action under or in connection with this
         Agreement and the other Loan Documents.

                                     -58-

<PAGE>

                  SECTION 8.07  Indemnification.
                                ---------------

                  Each Lender agrees to reimburse and indemnify the
Administrative Agent and its directors, officers, employees and agents (to the
extent not reimbursed by the Borrower and without limitation of the obligations
of the Borrower to do so, in each case pursuant to the terms of this Agreement
and the other Loan Documents), based on its Applicable Percentage, from and
against any and all amounts, losses, liabilities, claims, damages, expenses,
obligations, penalties, actions, judgments, suits, costs or disbursements of any
kind or nature (including, without limitation, the fees and disbursements of
counsel for the Administrative Agent or such other Person in connection with any
investigative, administrative or judicial proceeding commenced or threatened,
whether or not the Administrative Agent or such other Person shall be designated
a party thereto) that may at any time be imposed on, incurred by or asserted
against the Administrative Agent or such other Person as a result of, or arising
out of, or in any way related to or by reason of, this Agreement, any other Loan
Document, any transaction from time to time contemplated hereby or thereby, or
any transaction financed in whole or in part or directly or indirectly with the
proceeds of any Loan, provided that no Lender shall be liable for any portion of
                      --------
such amounts, losses, liabilities, claims, damages, expenses, obligations,
penalties, actions, judgments, suits, costs or disbursements resulting solely
from the gross negligence or willful misconduct of the Administrative Agent or
such other Person, as finally determined by a court of competent jurisdiction.
Payments under this Section 8.07 shall be due and payable on demand, and to the
extent that any Lender fails to pay any such amount on demand, such amount shall
bear interest for each day from the date of demand until paid (before and after
judgment) at a rate per annum (calculated on the basis of a year of 360 days and
actual days elapsed) which for each day shall be equal to the Federal Funds
Effective Rate for such day.

                  SECTION 8.08  Administrative Agent in its Individual Capacity.
                                -----------------------------------------------

                  With respect to its Commitment and the Obligations owing to
it, the Administrative Agent shall have the same rights and powers under this
Agreement and each other Loan Document as any other Lender and may exercise the
same as though it were not the Administrative Agent, and the terms "Lenders,"
"holders of Notes" and like terms shall include the Administrative Agent in its
individual capacity as such. The Administrative Agent and its affiliates may,
without liability to account, make loans to, accept deposits from, acquire debt
or equity interests in, act as trustee under indentures of, and engage in any
other business with, the Borrower and any stockholder, subsidiary or affiliate
of the Borrower, as though the Administrative Agent were not the Administrative
Agent hereunder.

                  SECTION 8.09  Holders of Notes.
                                ----------------

                  The Administrative Agent may deem and treat the Lender which
is payee of a Note as the owner and holder of such Note for all purposes hereof
unless and until an Assignment and Acceptance with respect to the assignment or
transfer thereof shall have been filed with the Administrative Agent in
accordance with Section 9.12. Any authority, direction or consent of any Person
who at the time of giving such authority, direction or consent is shown in the
Register as being a Lender shall be conclusive and binding on each present and
subsequent holder, transferee or assignee of any Note or Notes payable to such
Lender or of any Note or Notes issued in exchange therefor.

                                     -59-

<PAGE>

                  SECTION 8.10  Successor Administrative Agent.
                                ------------------------------

                  The Administrative Agent may resign at any time by giving 10
days' prior written notice thereof to the Lenders and the Borrower. The
Administrative Agent may be removed by the Required Lenders at any time with or
without cause by giving 10 days' prior written notice thereof to the
Administrative Agent, the other Lenders and the Borrower. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Administrative Agent. If no successor Administrative Agent shall have
been so appointed and consented to, and shall have accepted such appointment,
within 30 days after such notice of resignation or removal, then the retiring
Administrative Agent, on behalf of the Lenders, may appoint a successor
Administrative Agent. Each successor Administrative Agent shall be a commercial
bank or trust company organized under the Laws of the United States of America
or any State thereof and having a combined capital and surplus of at least
$1,000,000,000. The appointment of any successor Administrative Agent at any
time pursuant to this Section 8.10 shall be subject to the approval of the
Borrower, provided that at such time there shall not have occurred and be
          --------
continuing any Default or Event of Default, and provided further that the
                                                ----------------
Borrower's consent to any such appointment shall not be unreasonably withheld.
Upon the acceptance by a successor Administrative Agent of its appointment as
Administrative Agent hereunder, such successor Administrative Agent shall
thereupon succeed to and become vested with all the properties, rights, powers,
privileges and duties of the former Administrative Agent without further act,
deed or conveyance. Upon the effective date of resignation or removal of a
retiring Administrative Agent, the Administrative Agent shall be discharged from
its duties under this Agreement and the other Loan Documents, but the provisions
of this Agreement shall inure to its benefit as to any actions taken or omitted
by it while it was Administrative Agent under this Agreement. If and for so long
as no successor Administrative Agent shall have been appointed, then any notice
or other communication required or permitted to be given by the Administrative
Agent shall be sufficiently given if given by the Required Lenders, all notices
or other communications required or permitted to be given to the Administrative
Agent shall be given to each Lender, and all payments to be made to the
Administrative Agent shall be made directly to the Borrower or Lender for whose
account such payment is made.

                  SECTION 8.11  Additional Administrative Agents.
                                --------------------------------

                  If the Administrative Agent shall from time to time deem it
necessary or advisable, for its own protection in the performance of its duties
hereunder or in the interest of the Lenders, the Administrative Agent and the
Borrower shall execute and deliver a supplemental agreement and all other
instruments and agreements necessary or advisable in the opinion of the
Administrative Agent to constitute another commercial bank or trust company, or
one or more other Persons approved by the Administrative Agent, to act as
co-Administrative Agent, with such powers of the Administrative Agent as may be
provided in such supplemental agreement, and to vest in such bank, trust company
or Person, as such co-Administrative Agent, any properties, rights, powers,
privileges and duties of the Administrative Agent under this Agreement or any
other Loan Document. The appointment of any co-Administrative Agent at any time
pursuant to this Section 8.11 shall be subject to the approval of the Borrower,
provided that at such time there shall not have occurred and be continuing any
--------
Default or Event of Default, and provided further that the Borrower's consent to
                                 -------- -------
any such appointment shall not be unreasonably withheld.

                                     -60-

<PAGE>

                  SECTION 8.12  Calculations.
                                ------------

                  The Administrative Agent shall not be liable for any
calculation, apportionment or distribution of payments made by it in good faith,
in the absence of its own gross negligence or willful misconduct. If such
calculation, apportionment or distribution is subsequently determined to have
been made in error, the sole recourse of any Lender to whom payment was due but
not made (except as provided in the preceding sentence) shall be to recover from
the other Lenders any payment in excess of the amount to which they are
determined to be entitled or, if the amount due was not paid by the Borrower, to
recover such amount from the Borrower.

                  SECTION 8.13  Syndication Agent.
                                -----------------

                  As Syndication Agent, Wells Fargo Bank, N.A. shall not have
any right, power, obligation, liability, responsibility or duty under this
Agreement or any other Loan Document other than those applicable to all Lenders
as such. Without limiting the foregoing, Wells Fargo Bank, N.A. shall not have
any or be deemed to have any fiduciary relationship with any Lender. Each Lender
acknowledges that it has not relied, and will not rely, on Wells Fargo Bank,
N.A. in deciding to enter into this Agreement or in not taking action hereunder
or under the Loan Documents.

                  SECTION 8.14  Sole Bookrunner.
                                ---------------

                  As Sole Bookrunner, Union Bank of California, N.A. shall not
have any right, power, obligation, liability, responsibility or duty under this
Agreement or any other Loan Document other than those applicable to all Lenders
as such. Without limiting the foregoing, Union Bank of California, N.A. shall
not have any or be deemed to have any fiduciary relationship with any Lender.
Each Lender acknowledges that it has not relied, and will not rely, on Union
Bank of California, N.A. in deciding to enter into this Agreement or in not
taking action hereunder or under the Loan Documents.

                  SECTION 8.15  Co-Documentation Agents.
                                -----------------------

                  As Co-Documentation Agents, none of Bank One, NA, BNP Paribas
or Mellon Bank, N.A. shall have any right, power, obligation, liability,
responsibility or duty under this Agreement or any other Loan Document other
than those applicable to all Lenders as such. Without limiting the foregoing,
none of Bank One, NA, BNP Paribas or Mellon Bank, N.A. shall have any or be
deemed to have any fiduciary relationship with any Lender. Each Lender
acknowledges that it has not relied, and will not rely, on Bank One, NA, BNP
Paribas or Mellon Bank, N.A. in deciding to enter into this Agreement or in not
taking action hereunder or under the Loan Documents.

                                   ARTICLE IX
                                  MISCELLANEOUS

                  SECTION 9.01  Amendments and Waivers.
                                ----------------------

                  Neither this Agreement nor any other Loan Document may be
amended, modified or supplemented except in accordance with the provisions of
this Section 9.01. The

                                     -61-

<PAGE>

Administrative Agent and the Borrower may from time to time amend, modify or
supplement the provisions of this Agreement or any other Loan Document for the
purpose of amending, adding to or waiving any provision, or changing in any
manner the rights and duties of the Borrower, the Administrative Agent or any
Lender. Any such amendment, modification or supplement made by the Borrower and
the Administrative Agent in accordance with the provisions of this Section 9.01
shall be binding upon the Borrower, each Lender and the Administrative Agent.
The Administrative Agent shall enter into such amendments, modifications or
supplements from time to time as directed by the Required Lenders, and only as
so directed, provided, that no such amendment, modification or supplement may
             --------
be made which will:

                  (a) Increase the  Commitment of any Lender over the amount
         thereof then in effect,  without the written consent of each Lender
         affected thereby;

                  (b) Extend the Revolving Termination Date, without the
         written consent of all the Lenders;

                  (c) Reduce the principal amount of or extend the time for any
         payment of principal of any Loan, or reduce the rate of interest or
         extend the time for payment of any interest borne by any Loan, or
         extend the time for payment of or reduce the amount of any fees, or
         reduce the amount of or postpone the date for payment of any other
         obligation, without the written consent of each Lender affected
         thereby;

                  (d) Change the definition of "Required Lenders" or amend this
         Section 9.01 or Section 9.12(a) or any other provision of this
         Agreement that requires the consent of all of the Lenders to the taking
         or failure to take action hereunder, without the written consent of all
         the Lenders;

                  (e) Amend or waive any of the provisions of Article VIII, or
         impose additional duties upon the Administrative Agent or otherwise
         adversely affect the rights, interests or obligations of the
         Administrative Agent, without the written consent of the Administrative
         Agent; or

                  (f) Release any General and Refunding Bonds issued to the
         Administrative  Agent pursuant to Section 6.09(b), without the written
         consent of all the Lenders;

and provided, further, that Assignment and Acceptances may be entered into in
    --------  -------
the manner provided in Section 9.12. Any such amendment, modification or
supplement must be in writing and shall be effective only to the extent set
forth in such writing. Any Default or Event of Default waived or consented to in
any such amendment, modification or supplement shall be deemed to be cured and
not continuing to the extent and for the period set forth in such waiver or
consent, but no such waiver or consent shall extend to any other or subsequent
Default or Event of Default or impair any right consequent thereto.

                  SECTION 9.02  No Implied Waiver; Cumulative Remedies.
                                --------------------------------------

                  No course of dealing and no delay or failure of the
Administrative Agent or any Lender in exercising any right, power or privilege
under this Agreement or any other Loan Document shall affect any other or future
exercise thereof or the exercise of any other right,

                                     -62-

<PAGE>

power or privilege; nor shall any single or partial exercise of any such right,
power or privilege or any abandonment or discontinuance of steps to enforce
such a right, power or privilege preclude any further exercise thereof or of
any other right, power or privilege. The rights and remedies of the
Administrative Agent and the Lenders under this Agreement and any other Loan
Document are cumulative and not exclusive of any rights or remedies which the
Administrative Agent or any Lender would otherwise have hereunder or
thereunder, at law, in equity or otherwise.

                  SECTION 9.03  Notices.
                                -------

                  (a) Except to the extent otherwise expressly permitted
hereunder or thereunder, all notices, requests, demands, directions and other
communications (collectively "notices") under this Agreement or any other Loan
                              -------
Document shall be in writing (including telecopied communication) and shall be
sent by first-class mail, or by nationally-recognized overnight courier, or by
telecopier (with confirmation in writing mailed first-class or sent by such an
overnight courier), or by personal delivery. All notices shall be sent to the
applicable party at the address stated on the signature pages hereof or in
accordance with the last unrevoked written direction from such party to the
other parties hereto in all cases with postage or other charges prepaid. Any
such properly given notice shall be effective on the earliest to occur of
receipt, telephone confirmation of receipt of telecopy communication, one
Business Day after delivery to a nationally-recognized overnight courier, or
three Business Days after deposit in the mail.

                  (b) Any Lender giving any notice to the Borrower or any other
party to a Loan Document shall simultaneously send a copy thereof to the
Administrative Agent, and the Administrative Agent shall promptly notify the
other Lenders of the receipt by it of any such notice.

                  (c) The Administrative Agent and each Lender may rely on any
notice (whether or not such notice is made in a manner permitted or required by
this Agreement or any other Loan Document) purportedly made by or on behalf of
the Borrower, and neither the Administrative Agent nor any Lender shall have any
duty to verify the identity or authority of any Person giving such notice.

                  SECTION 9.04  Expenses; Taxes; Indemnity.
                                --------------------------

                  (a) The Borrower agrees to pay or cause to be paid and to save
the Administrative Agent and each of the Lenders harmless against liability for
the payment of all reasonable out-of-pocket costs and expenses (including but
not limited to reasonable fees and expenses of counsel) incurred by the
Administrative Agent or any Lender from time to time arising from or relating to
(i) in the case of the Administrative Agent, the negotiation, syndication,
preparation, execution, delivery, administration and performance of this
Agreement and the other Loan Documents, (ii) in the case of the Syndication
Agent, the syndication of this Agreement and the other Loan Documents, (iii) in
the case of the Administrative Agent, any amendments, modifications,
supplements, waivers or consents to this Agreement or any other Loan Document
(whether or not ultimately entered into or granted), and (iv) in the case of the
Administrative Agent or any Lender, the enforcement or preservation of rights
under this

                                     -63-

<PAGE>

Agreement or any other Loan Document (including but not limited to
any such costs or expenses arising from or relating to (A) collection or
enforcement of an outstanding Loan or any other amount owing hereunder or
thereunder by the Administrative Agent or such Lender, and (B) any litigation,
proceeding, dispute, work-out, restructuring or rescheduling related in any way
to this Agreement or the Loan Documents).

                  (b) The Borrower hereby agrees to pay all stamp, document,
transfer, recording, filing, registration, search, sales and excise fees and
taxes and all similar impositions now or hereafter determined by the
Administrative Agent or any Lender to be payable in connection with this
Agreement or any other Loan Documents or any other documents, instruments or
transactions pursuant to or in connection herewith or therewith (which
determination shall be conclusive provided it is reached in good faith), and the
Borrower agrees to save the Administrative Agent and each Lender harmless from
and against any and all present or future claims, liabilities or losses with
respect to or resulting from any omission to pay or delay in paying any such
fees, taxes or impositions.

                  (c) The Borrower hereby agrees to reimburse and indemnify each
of the Indemnified Parties from and against any and all losses, liabilities,
claims, damages, expenses, obligations, penalties, actions, judgments, suits,
costs or disbursements of any kind or nature whatsoever (including, without
limitation, the reasonable fees and disbursements of counsel for such
Indemnified Party in connection with any investigative, administrative or
judicial proceeding commenced or threatened, whether or not such Indemnified
Party shall be designated a party thereto) that may at any time be imposed on,
asserted against or incurred by such Indemnified Party as a result of, or
arising out of, or in any way related to or by reason of, this Agreement or any
other Loan Document, any transaction from time to time contemplated hereby or
thereby, or any transaction financed in whole or in part or directly or
indirectly with the proceeds of any Loan (and without in any way limiting the
generality of the foregoing, including any violation or breach of any
Environmental Law or any other Law by the Borrower or any Subsidiary of the
Borrower; any Environmental Claim arising out of the management, use, control,
ownership or operation of Property by any of such Persons, including all onsite
and off-site activities involving Hazardous Materials; or any exercise by the
Administrative Agent or any Lender of any of its rights or remedies under this
Agreement or any other Loan Document); but excluding any such losses,
liabilities, claims, damages, expenses, obligations, penalties, actions,
judgments, suits, costs or disbursements resulting solely from the gross
negligence or willful misconduct of such Indemnified Party, as finally
determined by a court of competent jurisdiction. If and to the extent that the
foregoing obligations of the Borrower under this subsection (c), or any other
indemnification obligation of the Borrower hereunder or under any other Loan
Document, are unenforceable for any reason, the Borrower hereby agrees to make
the maximum contribution to the payment and satisfaction of such obligations
which is permissible under applicable Law.

                  SECTION 9.05  Severability.
                                ------------

                  The provisions of this Agreement are intended to be severable.
If any provision of this Agreement shall be held invalid or unenforceable in
whole or in part in any jurisdiction such provision shall, as to such
jurisdiction, be ineffective to the extent of such invalidity or

                                     -64-

<PAGE>

unenforceability without in any manner affecting the validity or enforceability
thereof in any other jurisdiction or the remaining provisions hereof in any
jurisdiction.

                  SECTION 9.06  Prior Understandings.
                                --------------------

                  This Agreement and the other Loan Documents, as such
agreements shall be amended from time to time, supersede all prior and
contemporaneous understandings and agreements, whether written or oral, among
the parties hereto relating to the transactions provided for herein and therein.

                  SECTION 9.07  Duration; Survival.
                                ------------------

                  All representations and warranties of the Borrower contained
herein or in any other Loan Document or made in connection herewith or therewith
shall survive the making, and shall not be waived by the execution and delivery,
of this Agreement or any other Loan Document, any investigation by or knowledge
of the Administrative Agent or any Lender, the making of any Loan, or any other
event or condition whatever. All covenants and agreements of the Borrower
contained herein or in any other Loan Document shall continue in full force and
effect from and after the date hereof so long as the Borrower may borrow
hereunder and until payment in full of all Obligations. Without limitation, all
obligations of the Borrower hereunder or under any other Loan Document to make
payments to or indemnify the Administrative Agent or any Lender shall survive
the payment in full of all other Obligations, termination of the Borrower's
right to borrow hereunder, and all other events and conditions whatever. In
addition, all obligations of each Lender to make payments to or indemnify the
Administrative Agent shall survive the payment in full by the Borrower of all
Obligations, termination of the Borrower's right to borrow hereunder, and all
other events or conditions whatever.

                  SECTION 9.08  Counterparts.
                                ------------

                  This Agreement may be executed in any number of counterparts
and by the different parties hereto on separate counterparts each of which, when
so executed, shall be deemed an original, but all such counterparts shall
constitute but one and the same instrument.

                  SECTION 9.09  Limitation on Payments.
                                ----------------------

                  The parties hereto intend to conform to all applicable Laws in
effect from time to time limiting the maximum rate of interest that may be
charged or collected. Accordingly, notwithstanding any other provision hereof or
of any other Loan Document, the Borrower shall not be required to make any
payment to or for the account of any Lender, and each Lender shall refund any
payment made by the Borrower, to the extent that such requirement or such
failure to refund would violate or conflict with nonwaivable provisions of
applicable Laws limiting the maximum amount of interest which may be charged or
collected by such Lender.

                  SECTION 9.10  Set-Off.
                                -------

                  The Borrower hereby agrees that, to the fullest extent
permitted by Law, if any Obligation of the Borrower shall be due and payable (by
acceleration or otherwise), each Lender shall have the right, without notice to
the Borrower, to set-off against and to appropriate and

                                     -65-

<PAGE>

apply to such Obligation any indebtedness, liability or obligation of any nature
owing to the Borrower by such Lender, including but not limited to all deposits
(whether time or demand, general or special, provisionally credited or finally
credited, whether or not evidenced by a certificate of deposit) now or hereafter
maintained by the Borrower with such Lender. Such right shall be absolute and
unconditional in all circumstances and, without limitation shall exist whether
or not such Lender or any other Person shall have given notice or made a demand
to the Borrower or any other Person, whether such indebtedness, obligation or
liability owed to the Borrower is contingent, absolute, matured or unmatured (it
being agreed that such Lender may deem such indebtedness, obligation or
liability to be then due and payable at the time of such setoff), and regardless
of the existence or adequacy of any collateral, guaranty or any other security,
right or remedy available to any Lender or any other Person. The Borrower hereby
agrees that, to the fullest extent permitted by Law, any Participant and any
branch, subsidiary or affiliate of any Lender or any Participant shall have the
same rights of set-off as a Lender as provided in this Section (regardless of
whether such Participant, branch, subsidiary or affiliate would otherwise be
deemed in privity with or a direct creditor of the Borrower). The rights
provided by this Section are in addition to all other rights of set-off and
banker's lien and all other rights and remedies which any Lender (or any such
Participant, branch, subsidiary or affiliate) may otherwise have under this
Agreement, any other Loan Document, at law or in equity, or otherwise, and
nothing in this Agreement or any other Loan Document shall be deemed a waiver
or prohibition of or restriction on the rights of set-off or bankers' lien of
any such Person.

                  SECTION 9.11  Sharing of Collections.
                                ----------------------

                  The Lenders hereby agree among themselves that if any Lender
shall receive (by voluntary payment, realization upon security, set-off or from
any other source) any amount on account of the Loans, interest thereon, or any
other Obligation contemplated by this Agreement or the other Loan Documents to
be made by the Borrower pro rata to all Lenders (or pro rata to holders of
Notes) in greater proportion than any such amount received by any other
applicable Lender, then the Lender receiving such proportionately greater
payment shall notify each other Lender and the Administrative Agent of such
receipt, and equitable adjustment will be made in the manner stated in this
Section 9.11 so that, in effect, all such excess amounts will be shared ratably
among all of the applicable Lenders. The Lender receiving such excess amount
shall purchase (which it shall be deemed to have done simultaneously upon the
receipt of such excess amount) for cash from the other applicable Lenders a
participation in the applicable Obligations owed to such other Lenders in such
amount as shall result in a ratable sharing by all applicable Lenders of such
excess amount (and to such extent the receiving Lender shall be a Participant).
If all or any portion of such excess amount is thereafter recovered from the
Lender making such purchase, such purchase shall be rescinded and the purchase
price restored to the extent of such recovery, together with interest or other
amounts, if any, required by Law to be paid by the Lender making such purchase.
The Borrower hereby consents to and confirms the foregoing arrangements. Each
Participant shall be bound by this Section as fully as if it were a Lender
hereunder.

                                     -66-

<PAGE>

              SECTION 9.12  Successors and Assigns; Participations; Assignments.
                            ---------------------------------------------------

                  (a) Successors and Assigns. This Agreement shall be binding
                      ----------------------
upon and inure to the benefit of the Borrower, the Lenders, all future holders
of the Notes, the Agents and their respective successors and assigns, except
that the Borrower may not assign or transfer any of its rights hereunder or
interests herein without the prior written consent of all the Lenders and the
Administrative Agent, and any purported assignment without such consent shall be
void.

                  (b) Participations. Any Lender may, in the ordinary course of
                      --------------
its commercial banking business and in accordance with applicable Law, at any
time sell participations to one or more commercial banks or other Persons (each
a "Participant") in all or a portion of its rights and obligations under this
   -----------
Agreement and the other Loan Documents (including, without limitation, all or a
portion of its Commitment and the Loans owing to it and any Note held by it);
provided, that
--------
                  (i)      any such Lender's obligations under this Agreement
         and the other Loan Documents shall remain unchanged,

                  (ii)     such Lender shall remain solely responsible to the
         other parties hereto for the performance of such obligations,

                  (iii) the parties hereto shall continue to deal solely and
         directly with such Lender in connection with such Lender's rights and
         obligations under this Agreement and each of the other Loan Documents,

                  (iv)     such Participant shall be bound by the provisions of
         Section 9.11, and

                  (v) no Participant (unless such Participant is an Affiliate of
         such Lender, or is itself a Lender) shall be entitled to require such
         Lender to take or refrain from taking action under this Agreement or
         under any other Loan Document, except that such Lender may agree with
         such Participant that such Lender will not, without such Participant's
         consent, take any action, or consent to the taking of any action, of
         the type described in Section 9.01(a), (b) or (c).

The Borrower agrees that any such Participant shall be entitled to the benefits
of Sections 2.12, 2.13, 2.14 and 9.04 with respect to its participation in the
Commitments and the Loans outstanding from time to time; provided, that no such
                                                         --------
Participant shall be entitled to receive any greater amount pursuant to such
Sections than the transferor Lender would have been entitled to receive in
respect of the amount of the participation transferred to such Participant had
no such transfer occurred.

                  (c) Assignments. Any Lender may, in the ordinary course of its
                      -----------
commercial banking business and in accordance with applicable Law, at any time
assign all or a portion of its rights and obligations under this Agreement and
the other Loan Documents (including, without limitation, all or any portion of
its Commitment and Loans owing to it and any Note held by it) to any Lender, any
Affiliate of a Lender or to one or more additional commercial banks or other
Persons (each a "Purchasing Lender"); provided, that
                 -----------------    --------

                                     -67-

<PAGE>

                  (i) any such assignment to a Purchasing Lender which is not a
         Lender or an affiliate of a Lender shall be made only with the consent
         (which in each case shall not be unreasonably withheld) of the Borrower
         (so long as no Default or Event of Default shall have occurred and be
         continuing) and the Administrative Agent;

                  (ii) if a Lender makes such an assignment of less than all of
         its then remaining rights and obligations under this Agreement and the
         other Loan Documents, such transferor Lender shall retain, after such
         assignment, a minimum principal amount of $10,000,000 of the
         Commitments and Loans then outstanding, and such assignment, unless
         made to an assignee who is a Lender hereunder prior to such assignment,
         shall be in a minimum principal amount of $10,000,000 of the
         Commitments and Loans then outstanding;

                  (iii) each such assignment shall be of a constant, and not a
         varying, percentage of the Commitment of the transferor Lender and of
         all of the transferor Lender's rights and obligations under this
         Agreement and the other Loan Documents; and

                  (iv)  each such assignment shall be made pursuant to an
         Assignment and Acceptance.

In order to effect any such assignment, the transferor Lender and the Purchasing
Lender shall execute and deliver to the Administrative Agent a duly completed
Assignment and Acceptance (including the consents required by clause (i) of the
preceding sentence) with respect to such assignment, together with any Note or
Notes subject to such assignment and a processing and recording fee of $3,500;
and, upon receipt thereof, the Administrative Agent shall accept such Assignment
and Acceptance. Upon receipt of notice from the transferor Lender that it has
received the consideration described in the Assignment and Acceptance, the
Administrative Agent shall record such acceptance in the Register. Upon such
execution, delivery, acceptance and recording, from and after the close of
business at the Administrative Agent's Principal Office on the settlement date
specified in such Assignment and Acceptance:

                  (x) the Purchasing Lender shall be a party hereto and, to the
         extent provided in such Assignment and Acceptance, shall have the
         rights and obligations of a Lender hereunder, and

                  (y) the transferor Lender thereunder shall be released from
         its obligations under this Agreement to the extent so transferred (and,
         in the case of an Assignment and Acceptance covering all or the
         remaining portion of a transferor Lender's rights and obligations under
         this Agreement, such transferor Lender shall cease to be a party to
         this Agreement) from and after the settlement date.

On or prior to the settlement date specified in an Assignment and Acceptance,
the Borrower, at its expense, shall execute and deliver to the Administrative
Agent (for delivery to the Purchasing Lender) new Notes evidencing such
Purchasing Lender's assigned Commitment or Loans and (for delivery to the
transferor Lender) replacement Notes in the principal amount of the Loans or
Commitment retained by the transferor Lender (such Notes to be in exchange for,
but not in payment of, those Notes then held by such transferor Lender). Each
such Note shall be dated the

                                     -68-

<PAGE>

date and be substantially in the form of the predecessor Note. The
Administrative Agent shall mark the predecessor Notes "exchanged" and deliver
them to the Borrower. Accrued interest and accrued fees shall be paid to the
Purchasing Lender at the same time or times provided in the predecessor Notes
and this Agreement.

                  (d) Register. The Administrative Agent shall maintain at its
                      --------
office a copy of each Assignment and Acceptance delivered to it and a register
(the "Register") for the recordation of the names and addresses of the Lenders
      --------
and the Commitment of, and principal amount of the Loans owing to, each Lender
from time to time. The entries in the Register shall be conclusive absent
manifest error and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder
for all purposes of the Agreement. The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time to
time upon reasonable prior notice.

                  (e) Financial and Other Information. The Borrower authorizes
                      -------------------------------
the Administrative Agent and each Lender to disclose to any Participant or
Purchasing Lender (each, a "transferee") and any prospective transferee any and
                            ----------
all financial and other information in such Person's possession concerning the
Borrower and its Subsidiaries and Affiliates which has been or may be delivered
to such Person by or on behalf of the Borrower in connection with this Agreement
or any other Loan Document or such Person's credit evaluation of the Borrower
and its Subsidiaries and Affiliates.

                  (f) Assignments to Federal Reserve Bank. Any Lender may at any
                      -----------------------------------
time assign all or any portion of its rights under this Agreement, including
without limitation any Loans owing to it, and any Note held by it, to a Federal
Reserve Bank. No such assignment shall relieve the transferor Lender from its
obligations hereunder.

                  (g) Special Purpose Funding Vehicles. Notwithstanding anything
                      --------------------------------
to the contrary contained herein, any Lender (a "Granting Lender") may grant to
                                                 ---------------
a special purpose funding vehicle (an "SPC") the option to fund all or any part
                                       ---
of any Loan that such Granting Lender would otherwise be obligated to fund
pursuant to this Agreement; provided that (i) nothing herein shall constitute a
                            --------
commitment by any SPC to fund any Loan, and (ii) if an SPC elects not to
exercise such option or otherwise fails to fund all or any part of such Loan,
the Granting Lender shall be obligated to fund such Loan pursuant to the terms
hereof. The funding of a Loan by an SPC hereunder shall utilize the Revolving
Credit Commitment of the Granting Lender to the same extent, and as if, such
Loan were funded by such Granting Lender. Each party hereto hereby agrees that
no SPC shall be liable for any indemnity or payment under this Agreement for
which a Lender would otherwise be liable for so long as, and to the extent, the
Granting Lender provides such indemnity or makes such payment. Notwithstanding
anything to the contrary contained in this Agreement, any SPC may disclose on a
confidential basis any non-public information relating to its funding of Loans
to any rating agency, commercial paper dealer or provider of any surety or
guarantee to such SPC. This Section may not be amended without the prior written
consent of each Granting Lender, all or any part of whose Loan is being funded
by an SPC at the time of such amendment.

                                     -69-

<PAGE>

                  SECTION 9.13  Governing Law; Submission to Jurisdiction Waiver
                                ------------------------------------------------
of Jury Trial; Limitation of Liability.
--------------------------------------

                  (a) Governing Law. THIS AGREEMENT AND ALL OTHER LOAN DOCUMENTS
                      -------------
(EXCEPT TO THE EXTENT, IF ANY, OTHERWISE EXPRESSLY STATED IN SUCH OTHER LOAN
DOCUMENTS) SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.

                  (b)  Certain Waivers.  EACH PARTY TO THIS AGREEMENT HEREBY
                       ---------------
IRREVOCABLY AND UNCONDITIONALLY:

                  (i) AGREES THAT ANY ACTION, SUIT OR PROCEEDING BY ANY PERSON
         ARISING FROM OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
         OR ANY STATEMENT, COURSE OF CONDUCT, ACT, OMISSION, OR EVENT OCCURRING
         IN CONNECTION HEREWITH OR THEREWITH (COLLECTIVELY, "RELATED
                                                             -------
         LITIGATION") MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
         ----------
         JURISDICTION SITTING IN NEW YORK, NEW YORK AND SUBMITS TO THE
         JURISDICTION OF SUCH COURTS (AND, TO THE FULLEST EXTENT PERMITTED BY
         LAW, THE BORROWER AGREES THAT IT WILL NOT BRING ANY RELATED LITIGATION
         IN ANY OTHER FORUM, BUT NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE
         ADMINISTRATIVE AGENT OR ANY LENDER TO BRING ANY ACTION, SUIT OR
         PROCEEDING IN ANY OTHER FORUM IN WHICH THE BORROWER OR ANY OF ITS
         ASSETS MAY BE LOCATED OR IN WHICH THE BORROWER MAY BE DOING BUSINESS OR
         THE RIGHT OF THE BORROWER TO ASSERT ANY DEFENSE OR COUNTERCLAIM TO ANY
         ACTION BROUGHT BY THE ADMINISTRATIVE AGENT OR ANY LENDER IN ANY FORUM);

                  (ii) WAIVES ANY OBJECTION WHICH IT MAY HAVE AT ANY TIME TO THE
         LAYING OF VENUE OF ANY RELATED LITIGATION BROUGHT IN ANY SUCH COURT,
         WAIVES ANY CLAIM THAT ANY SUCH RELATED LITIGATION HAS BEEN BROUGHT IN
         AN INCONVENIENT FORUM, AND WAIVES ANY RIGHT TO OBJECT, WITH RESPECT TO
         ANY RELATED LITIGATION BROUGHT IN ANY SUCH COURT, THAT SUCH COURT DOES
         NOT HAVE JURISDICTION OVER IT;

                  (iii) CONSENTS AND AGREES TO SERVICE OF ANY SUMMONS, COMPLAINT
         OR OTHER LEGAL PROCESS IN ANY RELATED LITIGATION BY REGISTERED OR
         CERTIFIED U.S. MAIL, POSTAGE PREPAID, TO IT AT THE ADDRESS FOR NOTICES
         DESCRIBED IN SECTION 9.03, AND CONSENTS AND AGREES THAT SUCH SERVICE
         SHALL CONSTITUTE IN EVERY RESPECT VALID AND EFFECTIVE SERVICE (BUT
         NOTHING HEREIN SHALL AFFECT THE VALIDITY OR EFFECTIVENESS OF PROCESS
         SERVED IN ANY OTHER MANNER PERMITTED BY LAW); AND

                  (iv)  WAIVES THE RIGHT TO TRIAL BY JURY IN ANY RELATED
         LITIGATION.

                                     -70-

<PAGE>

                  (c) Limitation of Liability. TO THE FULLEST EXTENT PERMITTED
                      -----------------------
BY LAW, NO CLAIM MAY BE MADE BY ANY PARTY TO THIS AGREEMENT AGAINST ANY OTHER
PARTY TO THIS AGREEMENT OR ANY AFFILIATE, DIRECTOR, OFFICER, EMPLOYEE, ATTORNEY
OR AGENT OF ANY OF THEM FOR ANY SPECIAL, INCIDENTAL, INDIRECT, CONSEQUENTIAL OR
PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM ARISING FROM OR RELATING TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY STATEMENT, COURSE OF CONDUCT, ACT,
OMISSION, OR EVENT OCCURRING IN CONNECTION HEREWITH OR THEREWITH (WHETHER FOR
BREACH OF CONTRACT, TORT OR ANY OTHER THEORY OF LIABILITY). EACH PARTY TO THIS
AGREEMENT HEREBY WAIVES, RELEASES AND AGREES NOT TO SUE UPON ANY CLAIM FOR ANY
SUCH DAMAGES, WHETHER SUCH CLAIM PRESENTLY EXISTS OR ARISES HEREAFTER AND
WHETHER OR NOT SUCH CLAIM IS KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.

                               *        *         *

                                     -71-

<PAGE>

                                                                             S-1

                  IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year first above
written.

Address                                            NEVADA POWER COMPANY
-------

c/o Sierra Pacific Resources
6100 Neil Road
P.O. Box 30150                                     By___________________________
Reno, Nevada 89520                                   Name:
Attn:  Richard K. Atkinson                           Title:

                 Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-2

Address                                      UNION BANK OF CALIFORNIA, N.A., as
-------                                         Administrative Agent, as Co-Lead
                                                Arranger, as Sole Bookrunner and
Union Bank of California, N.A.                  as a Lender
445 South Figueroa Street, 15th Floor
Los Angeles, CA  90071
Attn:  Robert Olson
                                              By_______________________________
                                                Name:
                                                Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-3

Address                                 WELLS FARGO BANK,  N.A., as
-------                                    Syndication Agent,as Co-Lead Arranger
                                           and as a Lender
Wells Fargo Bank, N.A.
555 Montgomery Street, 17th Floor
San Francisco, CA  94111
Attn:  Dennis Bloch                         By_______________________________
                                              Name:
                                              Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-4

Address                                  BANK ONE, NA, as Co-Documentation Agent
-------                                    and as a Lender

Bank One, NA
1 Bank One Plaza, Suite IL1-0363
Chicago, IL 60670
Attn:  Dawn M. Lawler                    By_______________________________
                                           Name:
                                           Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-5

Address                                BNP PARIBAS, as Co-Documentation Agent
-------                                   and as a Lender

BNP Paribas
787 Seventh Avenue
New York, NY 10019
Attn:  Sean Finnegan                   By_______________________________
                                         Name:
                                         Title:

                                       By_______________________________
                                         Name:
                                         Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-6

Address                                  MELLON BANK, N.A., as Co-Documentation
-------                                      Agent and as a lender

Mellon Bank, N.A.
One Mellon Center
500 Grant Street, Room 4530
Pittsburgh, PA 15258-0001                By_______________________________
Attn:  Mark W. Rogers                      Name:
                                           Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-7

Address                                       BAYERISCHE LANDESBANK
-------                                          GIROZENTRALE

Bayerische Landesbank Girozentrale
560 Lexington Avenue
New York, NY 10022
Attn:  Jim Monaghan                           By_______________________________
                                                Name:
                                                Title:

                                              By_______________________________
                                                Name:
                                                Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-8

Address                                            THE INDUSTRIAL BANK OF JAPAN,
-------                                                LIMITED

The Industrial Bank of Japan, Limited
350 S. Grand Avenue, Suite 1500
Los Angeles, CA 09971
Attn: A1 Torres                                     By__________________________
                                                      Name:
                                                      Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                            S-9

Address                                            LEHMAN COMMERCIAL PAPER INC.
-------

Lehman Commercial Paper Inc.
101 Hudson Street
Jersey City, NJ 07302                              By__________________________
Attn:  Michele Swanson                               Name:
                                                     Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                           S-10

Address                                          FIRST UNION NATIONAL BANK
-------

First Union National Bank
301 South College Street
Charlotte, NC 38388-0251                         By____________________________
Attn:  Joe Dancy                                   Name:
                                                   Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                                                           S-11

Address                                        MERRILL LYNCH BANK USA
-------

Merrill Lynch Bank USA
15 W. South Temple, Suite 300
Salt Lake City, UT 84101                       By_______________________________
Attn:  Butch Alder                               Name:
                                                 Title:

            Signature Page to Nevada Power Company Credit Agreement

<PAGE>

                                   Commitments
                                   -----------

                [See definitions of "Commitment" in Section 1.01]

LENDER                                                        COMMITMENT AMOUNT
------                                                        -----------------

Union Bank of California, N.A.                                 $31,428,571.43

Wells Fargo Bank, N.A.                                         $31,428,571.43

Bank One, N.A.                                                 $28,235,294.12

BNP Paribas                                                    $28,235,294.12

Mellon Bank, N.A.                                              $24,537,815.13

Bayerische Landesbank Girozentrale                             $21,176,470.59

Lehman Commercial Paper Inc.                                   $12,268,907.55

The Industrial Bank of Japan, Limited                           $8,571,428.57

First Union National Bank                                       $7,058,823.53

Merrill Lynch Bank USA                                          $7,058,823.53

                    Total:                                    $200,000,000.00

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}]]