Document:

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                                  Exhibit 10.7a

                        PINNACLE WEST CAPITAL CORPORATION

                           SUPPLEMENTAL EXCESS BENEFIT

                                 RETIREMENT PLAN

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                                TABLE OF CONTENTS

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                                                                     PAGE
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<S>                                                                  <C>
ARTICLE ONE - PREAMBLE............................................      1

ARTICLE TWO - CONSTRUCTION........................................      2

ARTICLE THREE - ELIGIBILITY AND PARTICIPATION.....................      2

ARTICLE FOUR - BENEFITS...........................................      4

ARTICLE FIVE - PAYMENT OF BENEFITS................................      9

ARTICLE SIX - COORDINATION OF BENEFITS............................     12

ARTICLE SEVEN - FUNDING...........................................     13

ARTICLE EIGHT - ADMINISTRATION....................................     13

ARTICLE NINE - AMENDMENT AND TERMINATION OF THE PLAN..............     13

ARTICLE TEN - ASSIGNMENT..........................................     14

ARTICLE ELEVEN - WITHHOLDING......................................     14

ARTICLE TWELVE - OTHER BENEFIT PLANS OF THE COMPANY...............     15

ARTICLE THIRTEEN - MISCELLANEOUS..................................     15

ARTICLE FOURTEEN - EFFECTIVE DATE.................................     16
</TABLE>

                                        i

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                        PINNACLE WEST CAPITAL CORPORATION

                   SUPPLEMENTAL EXCESS BENEFIT RETIREMENT PLAN

                                   ARTICLE ONE

                                    PREAMBLE

         Effective January 1, 1987, PINNACLE WEST CAPITAL CORPORATION (the
"Company") adopted the PINNACLE WEST CAPITAL CORPORATION SUPPLEMENTAL EXCESS
BENEFIT RETIREMENT PLAN (the "Plan") for the purpose of paying retirement
benefits to certain employees in excess of the benefits permitted to be paid
under the Pinnacle West Capital Corporation Retirement Plan (the "Retirement
Plan") by reason of Section 415 of the Internal Revenue Code (the "Code"). The
Plan was thereafter amended several times to provide additional benefits,
thereby changing the Plan from an "excess benefit plan" under the Employee
Retirement Income Security Act of 1974, as amended (the "Act"), to a "top hat"
plan under the Act.

         Effective January 1, 1982, ARIZONA PUBLIC SERVICE COMPANY ("APS")
adopted the ARIZONA PUBLIC SERVICE COMPANY SUPPLEMENTAL EXCESS BENEFIT
RETIREMENT PLAN (the "APS Plan") for the purpose of paying retirement benefits
to certain employees in excess of the benefits permitted to be paid under the
Arizona Public Service Company Employees' Retirement Plan (the "APS Retirement
Plan") by reason of Section 415 of the Code. The Plan was thereafter amended
several times to provide additional benefits, thereby changing the Plan from an
"excess benefit plan" under the Act to a "top hat" plan under the Act.

         Effective January 1, 2000, the Company and APS amended and restated the
Plan and the APS Plan to merge the APS Plan into this Plan and to make other
technical changes. The Plan was amended several times thereafter. By this
amendment and restatement, the Company intends to amend the Plan to add a new
benefit structure.

                                        1

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                                   ARTICLE TWO

                                  CONSTRUCTION

         Terms capitalized in this Plan shall have the meaning given in Article
Two of the Retirement Plan, governing definitions and construction, except where
such terms are otherwise defined in this Plan. If any provision of this Plan is
determined to be invalid or unenforceable for any reason, the remaining
provisions shall continue in full force and effect. All of the provisions of
this Plan shall be construed and enforced according to the laws of the State of
Arizona, and shall be administered according to the laws of such state, except
as otherwise required by the Act, the Code or other applicable federal law. It
is the intention of the Company that the Plan, as adopted by the Company, shall
constitute an "unfunded plan of deferred compensation for a select group of
management and highly compensated employees" within the meaning of Sections
201(2) and 301(3) of the Act. Benefits under this Plan shall be paid from the
Company's general assets, and not from any trust fund or other segregated fund.
This Plan shall be construed in a manner consistent with the Company's
intention.

                                  ARTICLE THREE

                          ELIGIBILITY AND PARTICIPATION

         Employees of the Company or its Affiliates who are members of a select
group of management or highly compensated employees, as determined by the Human
Resources Committee of the Board of Directors of the Company, in its discretion,
shall be eligible to participate in the Plan if they satisfy the eligibility
requirements of Section 3(a) or Section 3(b).

         (a)      Eligible Employees who are officers of the Company or an
Affiliate which is a participating employer under the Retirement Plan shall be
entitled to the benefits described in Section 4(a).

                                        2

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         (b)      Eligible Employees of the Company or an Affiliate which is a
participating employer under the Retirement Plan who are not officers, who are
designated for participation by the Human Resources Committee of the Company's
Board of Directors and who are participants in the Retirement Plan shall be
entitled to the benefits described in Section 4(b). The Human Resources
Committee may make its designations under this Section 3(b) by individual
designation or by group designation.

         A participant shall commence participation in this Plan as of the first
day of the Plan Year in which he or she becomes a participant pursuant to this
ARTICLE THREE or the first day of his or her employment with the Company or an
Affiliate which is a participating employer under the Retirement Plan, whichever
is later. Such participation shall continue until the earlier of the date on
which the participant no longer satisfies the requirements for participation
under Section 3(a) or Section 3(b) or the date on which the Human Resources
Committee informs the participant in writing that he or she is no longer
eligible to participate in this Plan.

         Notwithstanding the foregoing, if the status of a participant changes
for reasons other than termination of employment with the Company or an
Affiliate which is a participating employer under the Retirement Plan, so that
he or she no longer is eligible to participate in the Plan, his or her
participation in the Plan shall cease but his or her benefit under this Plan as
of the date of his or her change of status shall not be canceled or distributed,
but shall be determined upon his or her termination of employment with the
Company or an Affiliate.

                                        3

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                                  ARTICLE FOUR

                                    BENEFITS

         (a)      Section 3(a) Participants.

                  (1)      Subject to ARTICLE SEVEN, a participant who is
eligible under Section 3(a) and who is a Group A Participant under the
Retirement Plan shall be entitled to a monthly benefit equal to the lesser of
(i) or (ii), reduced by (iii), where

                           (i)      Equals three percent (3%) of the
         participant's Average Monthly Compensation multiplied by the
         participant's Years of Service, not to exceed ten (10) Years of
         Service, plus two percent (2%) of the participant's Average Monthly
         Compensation multiplied by the participant's Years of Service in excess
         of ten (10) Years of Service,

                           (ii)     Equals sixty percent (60%) of the
         participant's Average Monthly Compensation, and

                           (iii)    Equals the amount of such participant's
         monthly benefit determined under the terms of the Retirement Plan and
         payable in accordance with Section 6.2 of the Retirement Plan.

                  (2)      Subject to ARTICLE SEVEN, a participant who is
eligible under Section 3(a) and who is a Group B Participant under the
Retirement Plan shall be entitled to a monthly benefit equal to the sum of (i)
and (ii), where

                           (i)      Equals the benefit determined under the
         formula set forth above in this Section 4(a)(1) for a Group A
         Participant in the Retirement Plan based on the participant's Years of
         Service as of March 31, 2003 and his or her Average Monthly
         Compensation as of the date of determination. Years of Service as of
         March 31, 2003 shall equal his or her full Years of Service as of such
         date plus a partial Year of Service equal to the lesser of one (1) or a
         fraction, the numerator of which is the participant's Hours of

                                        4

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         Service earned during the period beginning on the day after the last
         day of his or her Computation Period ending prior to March 31, 2003 and
         ending on March 31, 2003, and the denominator of which is 1,000, and

                           (ii)     Equals the monthly benefit for life payable
         at Normal Retirement Age which is the Actuarial Equivalent of a lump
         sum benefit equal to the participant's Supplemental Retirement Account
         Balance minus the participant's Retirement Account Balance under the
         Retirement Plan.

                  (3)      Subject to ARTICLE SEVEN, a participant who is
eligible under Section 3(a) and who is a Group C Participant under the
Retirement Plan shall be entitled to a monthly benefit equal to the Actuarial
Equivalent of a lump sum benefit equal to (i) reduced by (ii), where

                           (i)      Equals the participant's Supplemental
         Retirement Account Balance, and

                           (ii)     Equals the participant's Retirement Account
         Balance under the Retirement Plan.

                  A participant's Supplemental Retirement Account Balance shall
be a notional account credited with Monthly Retirement Account Balance Credits
and Interest Credits. For purposes of this Plan, Monthly Retirement Account
Balance Credits shall be determined under the general methodology set forth in
the Retirement Plan based on the participant's Monthly Compensation for the
month but using the following chart; provided that, except for a Group C
Participant, a participant shall not receive a Monthly Retirement Account
Balance Credit after he or she is credited with more than twenty-five (25) Years
of Service, with twenty-five years (25) Years of Service defined as twenty-five
(25) full twelve (12) month periods in duration:

                                        5

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<TABLE>
<CAPTION>
                          Percent of Monthly Compensation
                                    Contribution
Age at End of Plan Year                 Rate
-----------------------   -------------------------------
<S>                       <C>
Less than 35                           12%
35-39                                  14%
40-44                                  16%
45-49                                  20%
50-54                                  24%
55 and over                            28%
</TABLE>

                  For purposes of this Section 4(a), Compensation and Monthly
Compensation shall be determined without regard to the limitation set forth in
Section 401(a)(17) of the Code and shall be increased by any cash payments made
to the participant pursuant to bonus or incentive plans maintained by the
Company or an Affiliate which is a participating employer under the Retirement
Plan for employees generally and by any amounts deferred by the participant
under any of the Company's or such an Affiliate's deferred compensation plans
for employees, provided that bonus or incentive payments made in a form other
than cash, bonus or incentive payments which are not "year-end" bonus or
incentive payments, bonus or incentive payments under individual agreements
between the Company or such an Affiliate and a participant, and cash payments
made under bonus or incentive plans maintained by the Company or such an
Affiliate for employees generally which exceed the maximum amount that the
Company's President or Chief Operating Officer determines, in his or her
discretion, may be taken into account under this Plan shall not be taken into
account as Compensation and Monthly Compensation for purposes of this Plan
unless the Company's President or Chief Operating Officer determines, in his or
her discretion, that such bonus or incentive payment shall be taken into account
as Compensation and Monthly Compensation under this Plan. Eligible bonuses and
incentive payments shall be taken into account as Compensation and Monthly
Compensation in the year in which such amounts are paid rather than in the year
in which they are earned, provided that the Company's President or Chief
Operating Officer shall have the

                                        6

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authority to determine, in his or her discretion, that such bonus or incentive
payment shall be taken into account in the year in which such amounts are earned
rather than in the year in which they are paid. The Company's President or Chief
Operating Officer shall have the sole and absolute discretion to determine
whether a bonus or incentive payment made to a participant constitutes
Compensation or Monthly Compensation for purposes of this Section 4(a) and may
differentiate among individuals in establishing the bonus or incentive payments
that may be taken into account under the Plan.

                  Notwithstanding anything herein to the contrary, the monthly
benefit under this Section 4(a) of a participant who was eligible under Section
3(a) on December 31, 1999 shall not be less than such monthly benefit on such
date, and the monthly benefit under this Section 4(a) of a participant who was
eligible under Section 3(a) of the APS Plan on December 31, 1999 shall not be
less than the monthly benefit of such participant under Section 4(a) of the APS
Plan on such date, except to the extent attributable solely to an increase in
any such participant's monthly benefit under the Retirement Plan due to an
increase in the limitations under Sections 401(a)(17) and 415 of the Code.

         (b)      Section 3(b) Participants.

                  Subject to ARTICLE SIX and ARTICLE SEVEN, any participant who
is designated for participation pursuant to Section 3(b) and who receives a
benefit under the Retirement Plan, or such participant's surviving spouse or
beneficiary in the event of the participant's death, shall be entitled to a
monthly benefit payable in accordance with this ARTICLE FOUR and with ARTICLE
FIVE equal to (i) reduced by (ii), where

                           (i)      Equals the amount of such participant's or
         surviving spouse's or beneficiary's monthly benefit under the
         Retirement Plan computed under the provisions of the Retirement Plan
         but without regard to the cap on Compensation in Section 2.1(n) and

                                        7

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         the limitations in Section 5.13 of the Retirement Plan and the
         provisions of Sections 401(a)(17) and 415 of the Code; and

                           (ii)     Equals the amount of such participant's or
         surviving spouse's or beneficiary's monthly benefit actually payable
         under the terms of the Retirement Plan.

                  For purposes of this Section 4(b), Compensation shall include
any amount of the participant's regular salary that the participant elects to
defer under any deferred compensation plans for employees of the Company or an
Affiliate which is a participating employer under the Retirement Plan and shall
exclude all bonus or incentive payments paid to the participant. The Human
Resources Committee shall have the sole and absolute discretion to determine a
participant's Compensation for purposes of this Section 4(b).

                  Benefits payable under this Section 4(b) shall be payable to a
Plan participant or his or her spouse or other beneficiary in the same manner
and subject to all the same options, conditions, privileges and restrictions as
are applicable to the benefits payable to the Plan participant, spouse or other
beneficiary of a Participant under the Retirement Plan, as though such benefits
were payable as a part of the benefits being paid under the Retirement Plan.

                  Notwithstanding anything herein to the contrary, the monthly
benefit under this Section 4(b) of a participant who was eligible under Section
3(b) on December 31, 1999 shall not be less than such monthly benefit on such
date, and the monthly benefit under this Section 4(b) of a participant who was
eligible under Section 3(b) of the APS Plan on December 31, 1999 shall not be
less than the monthly benefit of such participant under Section 4(b) of the APS
Plan on such date, except to the extent attributable solely to an increase in
any such participant's monthly benefit under the Retirement Plan due to an
increase in the limitations under Sections 401(a)(17) and 415 of the Code.

                                        8

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                                  ARTICLE FIVE

                               PAYMENT OF BENEFITS

         (a)      A participant entitled to benefits under Section 4(a) which
are described in Section 4(a)(1) or 4(a)(2)(i) may elect to commence receiving
such benefits unreduced on or after the date on which the participant attains
the age of sixty-five (65) years or attains the age of sixty (60) years and is
credited with at least twenty (20) Years of Service. A participant may elect to
commence receiving benefits earlier if he or she has attained at least the age
of fifty-five (55) years and is credited with at least ten (10) Years of
Service, provided that the participant's benefit which represents the portion of
his or her benefit calculated in accordance with Section 4(a)(1) or 4(a)(2)(i)
shall be reduced by three percent (3%) for each year (or part thereof) by which
the participant's retirement age precedes the date on which he or she would have
attained the age of sixty (60) years if he or she is credited with at least
twenty (20) Years of Service or the date on which he or she would have attained
the age of sixty-five (65) years if credited with less than twenty (20) Years of
Service.

         Benefits payable to a participant under Section 4(a)(1) or Section
4(a)(2)(i) shall be payable in accordance with Section 6.2 of the Retirement
Plan, and if married, shall provide a monthly payment to the participant for his
or her life equal to the amount determined under Section 4(a)(1) or Section
4(a)(2)(i) and upon his or her death, shall provide monthly payments to the
participant's spouse for life equal to fifty percent (50%) of the monthly
payment being received by the participant at the time of his or her death.

         If a participant entitled to benefits under Section 4(a)(1) or Section
4(a)(2)(i) dies while still employed by the Company or an Affiliate, the
participant's spouse shall be entitled to a survivor annuity equal to one
hundred percent (100%) of the monthly benefit that the participant would have
received under Section 4(a)(1) or Section 4(a)(2)(i) had he or she terminated
employment on the day before he or she died, survived to the age on which he or
she would first be

                                        9

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eligible to commence benefits under this Section 5(a), elected to retire and
commence benefits under the Plan at that time and then died. Benefits payable to
the surviving spouse shall commence on the first day of the month following the
participant's date of death. The surviving spouse's monthly benefit shall be
reduced by the monthly benefit that the spouse receives under Section 5.9 or
Section 5.10 of the Retirement Plan, whichever is applicable. Benefits payable
to a terminated participant entitled to benefits under Section 4(a)(1) or
4(a)(2)(i) who dies prior to commencing benefits shall be paid in the form of a
survivor annuity equal to fifty percent (50%) of the monthly benefit which the
participant would have received had he or she survived to the earliest date
under this Section 5(a) upon which he or she could have commenced benefits. Such
benefits shall commence on the earliest date under this Section 5(a) upon which
the participant could have commenced benefits had he or she survived. The
surviving spouse's monthly benefit shall be reduced by the monthly benefit that
the spouse receives under Section 5.9 or Section 5.10 of the Retirement Plan,
whichever is applicable.

         (b)      Benefits payable to a participant under Section 4(a)(2)(ii) or
Section 4(a)(3) shall become payable when a participant (or his or her spouse or
beneficiary) begins to receive payment of his or her Retirement Account Balance
under the Retirement Plan, and shall be subject to the same adjustments and
shall be payable by the Company in the same manner and at the same time as the
Plan participant's (or his or her spouse's or beneficiary's) Retirement Account
Balance under the Retirement Plan is paid, as though such benefits were
otherwise payable as a part of the benefits being paid under the Retirement
Plan. An election or mode of payment under the Retirement Plan with respect to
the participant's Retirement Account Balance shall constitute an election of a
similar mode of payment under this Plan.

         (c)      Benefits payable to a participant under Section 4(b) shall
become payable when a participant (or his or her spouse or beneficiary) begins
to receive payments under the

                                       10

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Retirement Plan, and shall be subject to the same adjustments and shall be
payable by the Company in the same manner and at the same time as the Plan
participant's (or his or her spouse's or beneficiary's) benefits under the
Retirement Plan are paid, as though such benefits were otherwise payable as a
part of the benefits being paid under the Retirement Plan, subject to ARTICLE
SIX. Except as provided in this Subsection (c) or Subsection (d) of this ARTICLE
FIVE, an election or mode of payment under the Retirement Plan shall constitute
an election of a similar mode of payment under this Plan. The form of payment
under Section 6.6 of the Retirement Plan shall not be available under this Plan.

         (d)      If the present value of a Participant's vested benefits under
the Plan is Five Thousand Dollars ($5,000.00), or less, at any time after the
Participant's retirement or termination of employment and before his or her
Annuity Starting Date, the Participant's vested benefits shall be distributed in
a single lump sum. The benefits of a non-vested Participant shall automatically
be deemed to be cashed out pursuant to this ARTICLE FIVE (d) upon such
Participant's termination of employment. If the present value of a Participant's
vested benefits is more than Five Thousand Dollars ($5,000.00) but not more than
Ten Thousand Dollars ($10,000.00) at any time after the Participant's retirement
or termination of employment and before his or her Annuity Starting Date, the
Participant's vested benefits shall be distributed in a single lump sum if such
distribution is requested in writing by the Participant and his spouse, if
married, in accordance with the consent and waiver provisions of Section 6.2 of
the Retirement Plan.

         If the present value of the Spouse's Benefit or Vested Survivor's
Benefit under the Plan, as applicable, is Five Thousand Dollars ($5,000.00), or
less, at any time after the Participant's death and before the commencement of
such benefit, the benefit shall be distributed in a single lump sum. If the
present value of the Spouse's Benefit or Vested Survivor's Benefit is more than
Five Thousand Dollars ($5,000.00) but not more than Ten Thousand Dollars
($10,000.00) at any

                                       11

<PAGE>

time after the Participant's death and before the commencement of such benefit,
the benefit shall be distributed in a single lump sum if such distribution is
requested in writing by the Participant's surviving Spouse.

         For purposes of calculating the present value of a Participant's vested
benefits, the Spouse's Benefit or the Vested Survivor's Benefit, the actuarial
assumptions incorporated by reference in Section 2.1(c) of the Retirement Plan
shall be used, but in no event shall such present value be less than the present
value calculated using the "applicable interest rate" and "applicable mortality
table," as defined in Section 5.19 of the Retirement Plan.

                                   ARTICLE SIX

                            COORDINATION OF BENEFITS

         If an employee who was participating in a retirement plan sponsored by
an Affiliate, which is not a participating employer in the Retirement Plan,
becomes an employee of the Company or a participating Affiliate and a
participant in the Plan under Section 4(b) and such employee's accrued benefit
under the retirement plan maintained by the Affiliate formerly employing him or
her is transferred to the Retirement Plan, upon termination of employment, the
employee's benefits, calculated in accordance with Section 4(b), will be payable
in full from the Plan in accordance with Section 5(b). If an employee who was a
participant in the retirement plan of an Affiliate, which is not a participating
employer in the Retirement Plan, becomes an employee of the Company or a
participating Affiliate and a participant in this Plan, and such employee's
accrued benefit under the retirement plan maintained by his or her former
employer is not transferred to the Retirement Plan, upon termination of
employment, the employee's benefits, calculated in accordance with Section 4(b),
will be payable from the Plan in accordance with Section 5(b) to the extent such
benefits are attributable to the pension benefits payable to that employee under
the Retirement Plan. The benefits calculated pursuant to Section 4(b) that are
attributable to the pension benefits payable to

                                       12
<PAGE>

the employee under the Retirement Plan are those benefits that bear the same
ratio to the total benefits due to the employee, calculated pursuant to Section
4(b), as the benefit payable to the employee from the Retirement Plan bears to
the total benefits payable to the employee under both the Retirement Plan and
the retirement plan maintained by the Affiliate formerly employing that
employee.

                                  ARTICLE SEVEN

                                     FUNDING

         Benefits under this Plan shall be payable from the general assets of
the Company and shall not be segregated in a trust fund or otherwise funded in
any manner prior to the time of payment. No Plan participant shall have any
vested rights hereunder nor any right hereunder to any specific assets of the
Company.

                                  ARTICLE EIGHT

                                 ADMINISTRATION

         The Plan will be administered by the Administrative Committee that
administers the Retirement Plan. Except as otherwise expressly provided in this
Plan, the Administrative Committee shall have the same powers and
responsibilities as it has under Sections 10.4 and 12.2 of the Retirement Plan.
Claims for benefits under the Plan shall be determined in the manner set forth
in Article Eleven of the Retirement Plan.

                                  ARTICLE NINE

                      AMENDMENT AND TERMINATION OF THE PLAN

         The Plan may be amended in whole or in part, prospectively or
retroactively, by action of the Company's Board of Directors, and may be
terminated at any time by action of the Board of Directors; provided, however,
that no such amendment or termination shall reduce any amount payable hereunder
to the extent such amount accrued prior to the date of amendment or

                                       13

<PAGE>

termination. All amendments shall be in writing, approved by the Company's Board
of Directors and executed by a duly authorized officer of the Company.

                                   ARTICLE TEN

                                   ASSIGNMENT

         No Plan participant or beneficiary of a Plan participant shall have any
right to assign, pledge, hypothecate, anticipate or any way create a lien on any
amounts payable hereunder. No amounts payable hereunder shall be subject to
assignment or transfer or otherwise be alienable, either by voluntary or
involuntary act, or by operation of law, or be subject to attachment, execution,
garnishment, sequestration or other seizure under any legal, equitable or other
process, or be liable in any way for the debts or defaults of Plan participants
and their beneficiaries. Notwithstanding the foregoing, assignments of the
benefits provided under this Plan shall be permitted for purposes of satisfying
family support obligations if such assignments are pursuant to a court order
which satisfies the requirements for a "qualified domestic relations order" as
defined in Section 206(d)(3) of the Act.

                                 ARTICLE ELEVEN

                                   WITHHOLDING

         Any taxes required to be withheld from payments to the Plan
participants hereunder shall be deducted and withheld by the Company.

                                       14

<PAGE>

                                 ARTICLE TWELVE

                       OTHER BENEFIT PLANS OF THE COMPANY

         Nothing contained in this Plan shall prevent a Plan participant prior
to his or her death, or his or her spouse or other beneficiary after his or her
death, from receiving, in addition to any payments provided for under this Plan,
any payments provided for under the Retirement Plan or under The Pinnacle West
Capital Corporation Savings Plan, or which would otherwise be payable or
distributable to him or her, his or her surviving spouse or beneficiary under
any plan or policy of the Company or otherwise. Nothing in this Plan shall be
construed as preventing the Company or any of its subsidiaries from establishing
any other or different plans providing for current or deferred compensation for
employees.

                                ARTICLE THIRTEEN

                                  MISCELLANEOUS

         Nothing contained in this Plan shall be construed as a contract of
employment between the Company and an employee, or as a right of any employee to
be continued in the employment of the Company, or as a limitation of the right
of the Company to discharge any of its employees, with or without cause.

         All of the provisions of this Plan shall be binding upon all persons
who shall be entitled to any benefit hereunder, their heirs and personal
representatives.

                                       15

<PAGE>

                                ARTICLE FOURTEEN

                                 EFFECTIVE DATE

         The Plan, as amended and restated, shall be effective as of January 1,
2003.

         IN WITNESS WHEREOF, the Company has caused this Pinnacle West Capital
Corporation Supplemental Excess Benefit Retirement Plan, as amended and restated
herein, to be executed by its duly authorized officer this 18th day of December,
2003.

                                PINNACLE WEST CAPITAL CORPORATION

                                By /s/ Jack E. Davis
                                   --------------------------------------------
                                Its   President & Chief Operating Officer
                                      of Pinnacle West Capital Corporation and
                                      President and Chief Executive Officer of
                                      Arizona Public Service Company

Attest:
By    /s/ Nancy C. Loftin
      ---------------------------------
Its   Vice President, General Counsel
      and Secretary

                                       16<PAGE>
                                                                  Exhibit 10.39

                                 VISTACARE, INC.

CONSULTANT NAME:    Perry G. Fine, M.D.
                   -----------------------------
CONSULTANT ADDRESS: 3230 Millcreek Rd.
                   -----------------------------
                    Salt Lake City, UT 84109
                   -----------------------------
TELEPHONE:          801-467-2944
                   -----------------------------
FACSIMILE:          801-486-82-8279
                   -----------------------------
EMAIL:              fine@aros.net
                   -----------------------------

                          CONSULTING SERVICES AGREEMENT

      This Consulting Services Agreement (this "Agreement") is made and entered
into as of September 1, 2003 (the "Effective Date"), by and between VistaCare,
Inc., a Delaware corporation (the "Company"), and the above named consultant, an
individual with a place of business or residence at the above identified address
("Consultant").

      NOW, THEREFORE, in consideration of the premises and the mutual promises
set forth herein, and for other good and valuable consideration the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree:

      1.    Consulting Services. Consultant hereby agrees to provide consulting
services to assist the Company as Senior Medical Advisor. Consultant shall
provide such consulting services and shall participate in such related
activities as may be reasonably requested from time to time by the Company. In
providing such consulting services, Consultant will:

            (a) Act as a liaison for the Company to clinical organizations such
      as NHPCO, Hospice Coalition, PGBA, CMS, AMA, AAHPM.

            (b) Assist with strategic planning regarding clinically-related
      initiatives as requested.

            (c) Provide consultation regarding difficult case management,
      ethical issues and medical-legal issues as requested.

            (d) Provide medical inservices and presentations to the VistaCare
      and medical communities as requested.

            (e) Provide such other related and similar consulting services as
      may be requested by the Company's Chief Executive Officer and/or Senior
      Vice President of Operations.
<PAGE>
      2.    Assignment of Projects. The priority of projects assigned to
Consultant will be determined in a manner established by the Company's Chief
Executive Officer and Senior Vice President of Operations.

      3.    Consideration.

            (a) In consideration for the services provided by and agreements of
      Consultant hereunder, Consultant shall receive:

                  (1) An annual retainer of $60,000, paid in equal monthly
            installments, to be paid as of the first day of each month,
            commencing September 2003.

                  (2) Travel and other business related expenses will be paid in
            accordance with Company policy.

      4.    Confidential Information.

            (a) As used herein, the term "Confidential Information" shall mean
      any and all information of the Company that is not generally known by
      others with whom it competes or does business, or with whom it plans to
      compete or do business and any and all information which, if disclosed by
      the Company, would assist in competition against it. Confidential
      Information includes, without limitation, such information relating to (i)
      the development, research, testing, marketing and financial activities of
      the Company, (ii) the manner in which the Company operates, (iii) the
      costs, sources of supply, financial performance and strategic plans of the
      Company, (iv) the identity and special needs of the patients, referral
      sources or suppliers of the Company and (v) the people and organizations
      with whom the Company has business relationships. Confidential Information
      also includes comparable information that the Company has received
      belonging to others or that was received by the Company with an
      understanding that it would not be disclosed. Confidential Information
      shall not include any information that: (A) was or becomes generally known
      in the trade or business of the Company or Consultant through no act of
      Consultant; or (B) has come into the possession of Consultant from a third
      party who is under no obligation to the Company to maintain the
      confidentiality of such information.

            (b) As used herein, the term "Person" shall mean any natural person
      or any corporation, association, partnership, joint venture, company,
      business trust, trust, organization, business or government or any
      governmental agency or political subdivision of any government.

            (c) Consultant acknowledges that the Company continually develops
      Confidential Information, that Consultant may develop Confidential
      Information for the Company and that Consultant may learn of Confidential
      Information during the term of this Agreement. Consultant will comply with
      the policies and procedures of the Company for

                                       2
<PAGE>
protecting Confidential Information and shall not at any time disclose to any
Person (except as required by applicable law or for the proper performance of
Consultant's duties and responsibilities to the Company), or use for
Consultant's own benefit or gain, any Confidential Information obtained by
Consultant incident to Consultant's consultancy or other association with the
Company. Consultant understands that this restriction shall continue to apply
without limitation after this Agreement terminates, regardless of the reason for
such termination.

            (d) All documents, records, tapes and other media of every kind and
      description relating to the business, present or otherwise, of the Company
      and any copies, in whole or in part, thereof (the "Documents"), whether or
      not prepared by Consultant, shall be the sole and exclusive property of
      the Company. Consultant shall safeguard all Documents and shall surrender
      to the Company upon termination of this Agreement, or at such earlier time
      or times as the Company's Chief Executive Officer or his designee may
      specify, all Documents then in Consultant's possession or control.

      5.    Restricted Activities.

            (a) Consultant agrees that some restrictions on Consultant's
      activities during and after the term of this Agreement are necessary to
      protect the goodwill, Confidential Information and other legitimate
      interests of the Company. During the term of this Agreement and for a
      period of one (1) year thereafter, Consultant shall not perform any
      services, either as a consultant, employee, investor or otherwise, which
      are similar to the services performed by the Consultant pursuant to this
      Agreement with or for any Person who competes or is planning to compete
      with any current, planned or reasonably foreseeable business, product or
      service of the Company. Acknowledging the strong interest of the Company
      in an undisrupted workplace, Consultant agrees that during the term of
      this Agreement and for a period of one (1) year thereafter, Consultant
      will not (i) hire or attempt to hire any employee or former employee of
      the Company or any of its affiliates for whom Consultant provided
      services, assist in such hiring by any Person or seek to persuade any
      employee of the Company or any such affiliates to discontinue employment
      or (ii) solicit or encourage any independent contractor or supplier
      providing services or products to the Company or any such affiliates to
      terminate or diminish its relationship with them. A former employee of the
      Company shall be a subject of this prohibition for one (1) year after such
      employee's employment with the Company has ceased.

      6.    Enforcement of Covenants. Consultant acknowledges that Consultant
has carefully read and considered all the terms and conditions of this
Agreement, including the restraints imposed upon him pursuant to Sections 4 and
5 hereof. Consultant agrees that such restraints are necessary for the
reasonable and proper protection of the Company and such restraints are
reasonable in respect to subject matter, length of time and geographic area.
Consultant further acknowledges that, were Consultant to breach any of the
covenants contained in Sections 4 and 5 hereof, the damage to the Company would
be irreparable and the Company

                                       3
<PAGE>
will not have an adequate remedy at law. The Company shall, therefore, be
entitled to obtain specific performance of Consultant's obligations under
Sections 4 and 5 and to obtain immediate injunctive relief.

      7.    Relationship. In performing the services under this Agreement,
Consultant shall be an independent contractor and not an employee of the
Company. Consultant explicitly recognizes that the Company will withhold no tax
payments and will provide no benefits to Consultant or its employees, if any,
unless specifically agreed to in writing. Furthermore, Consultant agrees to
provide its own workmen's compensation, except as provided by law, and to bear
any and all risk that it and its employees, if any, might face during the period
of Consultant's engagement with the Company. Nothing contained herein shall be
construed as making Consultant the agent, employee joint venturer or partner of
the Company or provide Consultant with the power or authority to bind the
Company to any contract, agreement, arrangement or obligation, except as may be
authorized by the Chief Executive Officer on a case-by-case basis.

      8.    Termination. This Agreement may be terminated by the Company or
Consultant upon 30 days' written notice with or without cause. The Company may
terminate this Agreement immediately if (a) Consultant commits a breach of trust
or act of dishonesty, fraud or gross negligence in connection with Consultant's
performance of the services hereunder, (b) Consultant breaches any term of this
Agreement or (c) Consultant engages in any willful and continuing
non-performance or substandard performance of the services Consultant has agreed
to perform.

      9.    No Conflicts. By executing this Agreement, Consultant represents
that (a) he has no conflicts of interest or relationships which would affect his
ability to perform the services hereunder and (b) Consultant is not bound by any
non-competition or similar agreement or arrangement that would prevent
Consultant from performing the services hereunder.

      10.   Assignment. Neither the Company nor Consultant may make any
assignment of this Agreement or any interest herein, by operation of law or
otherwise, without the prior written consent of the other; provided, however,
that the Company may assign its rights and obligations under this Agreement
without the consent of Consultant in the event that the Company shall hereafter
affect a reorganization, consolidate with, or merge into, any other Person or
transfer all or substantially all of its properties or assets to any other
Person. This Agreement shall inure to the benefit of and be binding upon the
Company and Consultant, their respective successors, executors, administrators,
heirs and permitted assigns.

      11.   Severability. If any term or provision of this Agreement shall
become or be declared illegal, invalid or unenforceable, such term or provision
shall be divisible from this Agreement and shall be deemed to be deleted from
this Agreement, provided that if such deletion

                                       4
<PAGE>
substantially affects or alters the commercial basis of this Agreement the
parties shall negotiate in good faith to amend and modify the terms and
provisions of this Agreement to give effect to the original intent of the
parties.

      12.   Notices. Any and all notices, requests, demands and other
communications provided for by this Agreement shall be in writing and shall be
effective when delivered in person or deposited in the United States mail,
postage prepaid, registered or certified, and addressed to Consultant at
Consultant's last known address on the books of the Company or, in the case of
the Company, at its principal place of business, attention of the Chief
Executive Officer, or to such other address as either party may specify by
notice to the other.

      13.   Miscellaneous. This Agreement constitutes the entire agreement
between the parties and supersedes all prior communications, agreements and
understandings, written or oral, with respect to the terms and conditions of
Consultant's engagement by the Company. This Agreement may be amended or
modified only by a written instrument signed by Consultant and by an expressly
authorized representative of the Company. The headings and captions in this
Agreement are for convenience only and in no way define or describe the scope or
content of any provision of this Agreement. This Agreement may be executed in
two or more counterparts, each of which shall be an original and all of which
together shall constitute one and the same instrument. This Agreement shall be
construed and enforced under and be governed in all respects by the laws of the
state of Arizona, as such laws are applied to agreements entered into and to be
performed entirely within the state of Arizona between Arizona residents,
without reference to its laws governing conflicts of law. Each of the parties
hereto agrees that any action at law or in equity arising out of or relating to
this Agreement shall be filed only in state or federal court located in Phoenix,
Arizona, and each party hereby irrevocably and unconditionally consents and
submits to the exclusive jurisdiction of such courts over any suit, action or
proceeding arising out of this Agreement. The rights and obligations of the
parties under Section 5 shall survive termination of this Agreement for any
reason for the periods expressly stated therein. The rights and obligations of
the parties under Section 3 and 4 shall survive without limitation after this
Agreement terminates, regardless of the reason for such termination.

      IN WITNESS WHEREOF, this Agreement has been executed by the Company, by
its duly authorized representative, and by Consultant, as of the date first
above written.

CONSULTANT                                                VISTACARE, INC.

/s/ Perry G. Fine                         By: /s/ Stephen Lewis
--------------------------------------       -----------------------------------
Perry G. Fine, M.D.                          Name:  Stephen Lewis
                                                  ------------------------------
                                             Title: Sr. Vice President
                                                   -----------------------------

                                       5

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