EXHIBIT 10(A)

[EXECUTION COPY]

$75,000,000

CREDIT AGREEMENT

dated as of

November 30, 2001

among

SIERRA PACIFIC RESOURCES,

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.

TABLE OF CONTENTS

                                                                           Page
                                                                           ----

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

         SECTION 1.01  Defined Terms..........................................1
         SECTION 1.02  Classification of Loans and Borrowings................15
         SECTION 1.03  Terms Generally.......................................15
         SECTION 1.04  Accounting Terms; GAAP................................16

ARTICLE II       THE CREDITS.................................................16

         SECTION 2.01  The Commitments.......................................16
         SECTION 2.02  Loans and Borrowings..................................16
         SECTION 2.03  Requests for Revolving Borrowings.....................17
         SECTION 2.04  Funding of Borrowings.................................18
         SECTION 2.05  Interest Elections....................................18
         SECTION 2.06  Termination, Reduction and Extension of Commitments...19
         SECTION 2.07  Repayment of Loans; Evidence of Debt..................22
         SECTION 2.08  Prepayment of Loans...................................23
         SECTION 2.09  Fees..................................................23
         SECTION 2.10  Interest..............................................24
         SECTION 2.11  Alternate Rate of Interest............................24
         SECTION 2.12  Increased Costs.......................................25
         SECTION 2.13  Break Funding Payments................................26
         SECTION 2.14  Taxes.................................................26
         SECTION 2.15  Payments Generally; Pro Rata Treatment; Sharing of
                       Set-offs..............................................27
         SECTION 2.16  Mitigation Obligations; Replacement of Lenders........29

ARTICLE III      REPRESENTATIONS AND WARRANTIES..............................29

         SECTION 3.01  Corporate Status......................................29
         SECTION 3.02  Corporate Power and Authorization.....................30
         SECTION 3.03  Execution and Binding Effect..........................30
         SECTION 3.04  Governmental Approvals and Filings....................30
         SECTION 3.05  Absence of Conflicts..................................30
         SECTION 3.06  Audited Financial Statements..........................31
         SECTION 3.07  Interim Financial Statements..........................31
         SECTION 3.08  Absence of Undisclosed Liabilities....................31
         SECTION 3.09  Absence of Material Adverse Change....................31
         SECTION 3.10  Accurate and Complete Disclosure......................32
         SECTION 3.11  Margin Regulations....................................32
         SECTION 3.12  Litigation............................................32
         SECTION 3.13  Absence of Events of Default..........................32
         SECTION 3.14  Absence of Other Conflicts............................32
         SECTION 3.15  Insurance.............................................33
         SECTION 3.16  Title to Property; No Liens...........................33
         SECTION 3.17  Taxes.................................................33

TABLE OF CONTENTS
(Continued)

                                                                   Page
                                                                   ----
SECTION 3.18  Borrower Not An Investment Company; PUHCA Exemption...33
SECTION 3.19  Environmental Matters.................................34
SECTION 3.20  ERISA.................................................34
SECTION 3.21  Pari Passu Status.....................................35
SECTION 3.22  Indebtedness..........................................35

SECTION 5.01  Basic Reporting Requirements..........................39
SECTION 5.02  Insurance.............................................42
SECTION 5.03  Payment of Taxes and Other Potential Charges and
              Priority Claims.......................................42
SECTION 5.04  Preservation of Corporate Status and Franchises.......42
SECTION 5.05  Governmental Approvals and Filings....................43
SECTION 5.06  Maintenance of Properties.............................43
SECTION 5.07  Avoidance of Other Conflicts..........................43
SECTION 5.08  Financial Accounting Practices........................43
SECTION 5.09  Use of Proceeds.......................................43
SECTION 5.10  End of Fiscal Periods.................................44

SECTION 6.01  Financial Covenants...................................44
SECTION 6.02  Liens.................................................44
SECTION 6.03  Mergers...............................................45
SECTION 6.04  Dispositions of Properties............................46
SECTION 6.05  Investments and Acquisitions..........................47
SECTION 6.06  Dividends and Stock Repurchases.......................47
SECTION 6.07  Transactions with Affiliates..........................47
SECTION 6.08  Change of Business....................................47
SECTION 6.09  Equal and Ratable Lien................................47
SECTION 6.10  Restrictive Agreements................................48
SECTION 6.11  Limitation on Indebtedness............................48
SECTION 6.12  Maintenance of Ownership of Significant Subsidiaries..48

ARTICLE VII DEFAULTS....................................................48

SECTION 7.01 Events of Default.....................................48
SECTION 7.02 Consequences of an Event of Default...................51

ARTICLE VIII THE AGENTS..................................................52

SECTION 8.01 Appointment...........................................52
SECTION 8.02 General Nature of Administrative Agent's Duties.......52

TABLE OF CONTENTS
(Continued)

                                                                   Page
                                                                   ----
SECTION 8.03  Exercise of Powers....................................53
SECTION 8.04  General Exculpatory Provisions........................53
SECTION 8.05  Administration by the Administrative Agent............54
SECTION 8.06  Lenders Not Relying on Administrative Agent or
              Other Lenders.........................................55
SECTION 8.07  Indemnification.......................................55
SECTION 8.08  Administrative Agent in its Individual Capacity.......55
SECTION 8.09  Holders of Notes......................................56
SECTION 8.10  Successor Administrative Agent........................56
SECTION 8.11  Additional Administrative Agents......................57
SECTION 8.12  Calculations..........................................57
SECTION 8.13  Syndication Agent.....................................57
SECTION 8.14  Sole Bookrunner.......................................57
SECTION 8.15  Co-Documentation Agents...............................58

         SECTION 9.01  Amendments and Waivers................................58
         SECTION 9.02  No Implied Waiver; Cumulative Remedies................59
         SECTION 9.03  Notices...............................................59
         SECTION 9.04  Expenses; Taxes; Indemnity............................60
         SECTION 9.05  Severability..........................................61
         SECTION 9.06  Prior Understandings..................................61
         SECTION 9.07  Duration; Survival....................................61
         SECTION 9.08  Counterparts..........................................61
         SECTION 9.09  Limitation on Payments................................61
         SECTION 9.10  Set-Off...............................................62
         SECTION 9.11  Sharing of Collections................................62
         SECTION 9.12  Successors and Assigns; Participations; Assignments...63
         SECTION 9.13  Governing Law; Submission to Jurisdiction Waiver
                       of Jury Trial; Limitation of Liability................65

                                    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

iii-

TABLE OF CONTENTS
(Continued)

Exhibit D FORM OF QUARTERLY COMPLIANCE CERTIFICATE

CREDIT AGREEMENT, dated as of November 30, 2001, among SIERRA PACIFIC RESOURCES, 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.

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

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

A. Prior to the Occurrence of Both an Acceptable NPC Rate Case and an Acceptable SPPC Rate Case:

====================================================================================================================
                               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
====================================================================================================================
Facility Fee                     0.10%            0.125%             0.15%             0.20%             0.30%
--------------------------------------------------------------------------------------------------------------------
Eurodollar Spread                0.65%            0.875%             0.975%            1.05%             1.25%
--------------------------------------------------------------------------------------------------------------------
ABR Spread                         0%               0%                 0%              0.05%             0.25%
--------------------------------------------------------------------------------------------------------------------

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 Both an Acceptable NPC Rate Case and an Acceptable SPPC Rate Case:

====================================================================================================================
                               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
====================================================================================================================
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%
--------------------------------------------------------------------------------------------------------------------

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 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 both an Acceptable NPC Rate Case and an Acceptable SPPC Rate Case and at all times thereafter, the pricing table set forth above under the caption "Upon and After the Occurrence of Both an Acceptable NPC Rate Case and an Acceptable SPPC Rate Case" shall be effective. Each change in the Applicable Rate (including any change based on the occurrence of both an Acceptable NPC Rate Case and an Acceptable SPPC 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.

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 the Borrower; or (b) for any period of 12 consecutive calendar months, a majority of the Board of Directors of the Borrower 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.

financial condition of the primary obligor prior to such obligation being a stated or determinable amount, or (c) to purchase Property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation, or (d) otherwise to assure or hold harmless the holder of any such primary obligation against loss in respect thereof. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made or, if not stated or if indeterminable, the maximum reasonably anticipated liability in respect thereof, except as specified in clause (b)(ii) above.

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 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.

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.

other nationally recognized securities rating agency approved for purposes hereof by the Required Lenders and the Borrower.

intercompany eliminations) of such Subsidiary as at the end of the Borrower's latest fiscal quarter exceeded 10% of the total assets of the Borrower and its Subsidiaries at such date, computed and consolidated in accordance with GAAP; or (c) the equity in the income from continuing operations before income taxes, extraordinary items and cumulative effect of a change in accounting principles of such Subsidiary for the period of four consecutive fiscal quarters ending at the end of the Borrower's latest fiscal quarter exceeded 10% of such income of the Borrower and its Subsidiaries for such period, computed and consolidated in accordance with GAAP; or (d) such Subsidiary is the parent of one or more other Subsidiaries of the Borrower and, together with such Subsidiaries, would, if considered in the aggregate, constitute a Significant Subsidiary pursuant to the foregoing clause (a), (b) or (c).

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.

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").

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.

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.

ARTICLE II
THE CREDITS

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.

(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 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.

with Section 2.08, the sum of the total Revolving Credit Exposures would exceed the total Commitments.

(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

(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).

Lender) to the extent of the Commitments, Loans and Notes assumed and purchased, the 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.

(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.

(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.

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.

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.

ARTICLE III
REPRESENTATIONS AND WARRANTIES

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

The Borrower and each Significant Subsidiary 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 Significant Subsidiary 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 Significant Subsidiary 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.

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.

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.

No 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.

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

(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.

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 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.

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.

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.

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.

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.

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 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.

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.

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

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 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.

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.

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.

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 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).

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. The Borrower is a "holding company" within the meaning of

(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 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 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.

(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 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.

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. [sec] 3713).

ARTICLE IV
CONDITIONS

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:

(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.

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:

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:

retained earnings and changes in cash flows for such fiscal year, in conformity with GAAP, subject to normal and recurring year-end audit adjustments.

(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 the Borrower.

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.

(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.

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.

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;

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.

The Borrower shall, and shall cause each Significant Subsidiary 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.

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.

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.

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.

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:

(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;

(b) Liens securing obligations of NPC issued under and pursuant to the terms and conditions of either (i) the NPC First Mortgage Indenture or (ii) the NPC General and Refunding Mortgage Indenture;

(c) Liens securing obligations of SPPC issued under and pursuant to the terms and conditions of either (i) the SPPC First Mortgage Indenture or (ii) the SPPC General and Refunding Mortgage Indenture;

(f) Liens on SPPC First Mortgage Bonds issued as collateral for medium-term notes issued pursuant to the Collateral Trust Indenture, dated as of June 1, 1992, between SPPC and Bankers Trust Company, as Trustee;

(g) Liens on "transition property" arising pursuant to
Section 843 of the California Public Utility Code for the benefit of holders of rate reduction bonds issued pursuant to a valid financing order of the California Public Utilities Commission;

(h) 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;

(i) 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;

(j) 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

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

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:

all Property Disposed of pursuant to this Section 6.04(d) from and after the date hereof shall not exceed $120,000,000.

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 $70,000,000 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.

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.

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 and (d) 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.

The Borrower shall not make any material change in the nature of its business as carried on at the date hereof.

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.

Except as otherwise permitted under this Article VI, and except for agreements referenced in or permitted by covenants contained within Article VI of the NPC Credit Agreement and Article VI of the SPPC Credit Agreement, 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 or to guarantee Indebtedness of the Borrower or any other Subsidiary of the Borrower.

The Borrower shall not create, incur, assume or suffer to exist any Indebtedness (including, without limitation, any Contingent Obligations, the Loans and any senior notes issued in connection with the Borrower's Corporate Premium Income Equity Securities (PIES)), or become or remain liable (contingently or otherwise) for any Indebtedness, in excess of $1,045,000,000 in the aggregate at any one time outstanding.

The Borrower (a) shall not, and shall not permit any of its Subsidiaries to, sell, transfer, assign or otherwise dispose of any shares of common stock of any Significant Subsidiary, any securities convertible into shares of common stock of any Significant Subsidiary or any warrants, rights or options to acquire such common stock or such convertible securities, and (b) shall not permit any Significant Subsidiary to issue any shares of common stock, any securities convertible into shares of common stock or any warrants, rights or options to acquire any such common stock or convertible securities, to any other Person (other than the Borrower or any Wholly-Owned Subsidiary of the Borrower).

ARTICLE VII
DEFAULTS

(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 under the NPC Credit Agreement or the SPPC Credit Agreement, (y) on account of any Indebtedness aggregating $10,000,000 or more in principal amount or
(z) 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.

(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.

(p) The Borrower shall fail to maintain ongoing utility segment-identifiable assets (exclusive of cash and marketable securities) and operating income relating to the generation or transmission and/or distribution of electricity or gas in a proportion equal to at least 80% of total assets (exclusive of cash and marketable securities) and operating income.

(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 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

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.

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.

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 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)).

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.

(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 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.

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.

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.

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.

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.

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.

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.

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

(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; or

(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;

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, 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.

(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.

(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 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.

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

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.

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.

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.

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.

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 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.

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.

(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).

(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 $5,000,000 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 $5,000,000 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 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.

(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.

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.

* * *

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                                            SIERRA PACIFIC RESOURCES
-------

Sierra Pacific Resources
6100 Neil Road
P.O. Box 30150                                     By_______________________
Reno, Nevada 89520                                    Name:

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

                                                   By__________________________
                                                      Name:

Title:

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

Title:

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:

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:

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:

Address                                            BAYERISCHE LANDESBANK
-------                                              GIROZENTRALE

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

                                                   By__________________________
                                                      Name:

Title:

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

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

Title:

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

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

Title:

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:

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

Union Bank of California, N.A.                                 $15,000,000.00

Wells Fargo Bank, N.A.                                         $15,000,000.00

Bank One, N.A.                                                 $10,588,235.29

BNP Paribas                                                    $10,588,235.29

Bayerische Landesbank Girozentrale                             $ 7,941,176.47

Mellon Bank, N.A.                                              $ 7,058,823.53

Lehman Commercial Paper Inc.                                   $ 3,529,411.78

First Union National Bank                                      $ 2,647,058.82

Merrill Lynch Bank USA                                         $ 2,647,058.82

                   Total:                                      $75,000,000.00

EXHIBIT 10(B)

THIS AGREEMENT, dated May 21, 2001, is made by and between Sierra Pacific Resources, a Nevada corporation (the "Company"), and Walter M. Higgins (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 disturbing 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:

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 Disability.

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 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 as such payments become due. 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.

6.1 Subject to Section 6.2 hereof, if the Executive's employment is terminated following a 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 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 unless 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, whether as a consequence of a Change in Control or otherwise, the Company shall pay to the Executive a

lump sum severance payment, in cash, equal to three 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 incentive award applicable to the Executive pursuant to any annual bonus or 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.

(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 fora 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) thirty-six (36) 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 or, if higher, during 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 thirty-six (36) 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) Anything in this Agreement to the contrary notwithstanding, if it is determined (as hereafter provided) that any payment or distribution by the Company, any person whose actions result in a Change in Control or any affiliate of the Company or such person, to or for the benefit of the Executive, whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise pursuant to or by reason of any other Agreement, policy, plan, program or arrangement, including without limitation, any stock option, stock appreciation right, or similar right, or the lapse or termination of any restriction on or the vesting or exercisability of any of the foregoing (a "Payment"), would be subject to the excise tax imposed by Section 4999 of the Code (or any successor provision thereto) by reason of being considered "contingent on a change in ownership or control" of the Company, within the meaning of Section 280G of the Code (or any successor provision thereto) or to any similar tax imposed by state or local law, or any interest or penalties with respect to such tax (such tax or taxes, together with any such interest and penalties, are hereafter collectively referred to as the "Excise Tax"), then the Executive will be entitled to receive an additional payment or payments (collectively, a "Gross-Up Payment") in an amount such that, after payment by the Executive of all taxes (including any interest or penalties imposed with respect to such taxes), including an Excise Tax, imposed upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon the Payments. No Gross-Up Payment will be made with respect to the Excise Tax, if any, attributable to (a) any incentive stock option, as defined by Section 422 of the Code ("ISO") granted prior to the execution of this Agreement (unless a comparable Gross-Up Payment has theretofore been made available with respect to such option), or (b) any stock appreciation or similar right, whether or not limited, granted in tandem with any ISO described in clause (a).

(B) Subject to the provisions of this Section, all determinations required to be made under this Section, including whether an Excise Tax and whether a Gross-Up Payment is required to be paid by the Company to the Executive and the amount of such Gross-Up Payment, will be made by a nationally recognized firm of certified public accountants (the "Accounting Firm") selected by the Executive in his sole discretion. The Executive will direct the Accounting Firm to submit its determination and detailed supporting calculations to both the Company

and the Executive within 15 calendar days after the Executive's termination, if applicable, and any other such time or times as may be requested by the Company or the Executive. If the Accounting Firm determines that any Excise Tax is payable by the Executive, the Company will pay the required Gross-Up Payment to the Executive within five business days after receipt of such determination and calculations with respect to any Payment to the Executive. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it will, at the same time as it makes such determination, furnish the Company and the Executive an opinion that the Executive has substantial authority not to report any Excise Tax on the Executive's federal, state, local income, or other tax return. Any determination by the Accounting Firm as to the amount of the Gross-Up Payment will be binding upon the Company and the Executive. As a result of the uncertainty in the application of Section 4999 of the Code (or any successor provision thereto) and the possibility of similar uncertainty regarding applicable state or local tax law at the time of any determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments that will not have been made by the Company should have been made (an "Underpayment), consistent with the calculations required to be made hereunder. In the event that the Company exhausts or fails to pursue its remedies pursuant to this Section, and the Executive thereafter is required to make a payment of any Excise Tax, the Executive will direct the Accounting Firm to determine the amount of the Underpayment that has occurred and to submit its determination and detailed supporting calculations to both the Company and the Executive as promptly as possible. Any such Underpayment will be promptly paid by the Company to, or for the benefit of, the Executive within five business days after receipt of such determination and calculations.

(C) The Company and the Executive will each provide the Accounting Firm access to and copies of any books, records, and documents in the possession of the Company or the Executive, as the case may be, reasonably requested by the Accounting Firm, and otherwise cooperate with the Accounting Firm in connection with the preparation and issuance of the determinations and calculations contemplated by this Section.

(D) The federal, state, and local income or other tax returns filed by the Executive will be prepared and filed on a consistent basis with the determination of the Accounting Firm with respect to the Excise Tax payable by the Executive. The Executive will make proper payment of the amount of any Excise Tax, and at the request of the Company, provide to the Company true and correct copies (with any amendments) of the Executive's federal income tax return as filed with the Internal Revenue Service and corresponding state and local tax returns, if relevant, as filed with the applicable taxing authority, and such other documents reasonably requested by the Company, evidencing such payment. If prior to the filing of the Executive's federal income tax return, or corresponding state or local tax return, if relevant, the Accounting Firm determines that the amount of the Gross-Up Payment should be reduced, the Executive will, within five business days, pay to the Company the amount of such reduction.

(E) The fees and expenses of the Accounting Firm for its services in connection with the determinations and calculations contemplated by this section will be borne by the Company. If such fees and expenses are initially paid by the Executive, the Company will reimburse the Executive the full amount of such fees and expenses within five business days after receipt from the Executive of a statement therefore and reasonable evidence of his payment thereof.

(F) The Executive will notify the Company in writing of any claim by the Internal Revenue Service or other taxing authority that, if successful, would require the payment by the Company of a Gross-Up Payment. Such notification will be given as promptly as practicable but no later than 10 business days after the Executive actually receives notice of such claim and the Executive will further apprise the Company of the nature of such claim and the date on which such claim is requested to be paid (in each case, to the extent known by the Executive). The Executive will not pay such claim prior to the earlier of (a) the expiration of the 30-calendar-day period following the date on which the Executive gives such notice to the Company, and (b) the date that any payment of amount with respect to such claim is due. If the Company notifies the Executive in writing prior to the expiration of such period that it desires to contest such claim, the Executive will:

(a) provide the Company with any written records or documents in the Executive's possession relating to such claim reasonably requested by the Company;

(b) take such action in connection with contesting such claim as the Company will reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney competent with respect of the subject matter and reasonably selected by the Company;

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

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

provided, however, that the Company will bear and pay directly all costs and expenses (including interest and penalties) incurred in connection with such contest and will indemnify and hold harmless the Executive, on an after-tax basis, for and against any Excise Tax or income tax, including interest and penalties with respect thereto, imposed as a result of such representation and payment of costs and expenses. Without limiting the foregoing provisions of this Section, the Company will control all proceedings taken in connection with the contest of any claim contemplated by this Section and, at its sole option, may pursue or forego any and all administrative appeals, proceedings, hearings, and conferences with the taxing

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

(G) If, after the receipt by the Executive of an amount advanced by the Company pursuant to this Section, the Executive receives any refund with respect to such claim, the Executive will (subject to the Company's complying with the requirements of this Section) promptly pay to the Company the amount of such refund (together with any interest paid or credited thereon after any taxes applicable theret0). If, after the receipt by the Executive of an amount advanced by the Company pursuant to this Section, a determination is made that the Executive will not be entitled to any refund with respect to such claim and the Company does not notify the Executive in writing of its intent to contest such denial or refund prior to the expiration of 30 calendar days after such determination, then such advance will be forgiven and will not be required to be repaid and the amount of such advance will offset, to the extent thereof, the amount of the Gross-Up Payment required to be paid by the Company to the Executive pursuant to this Section.

6.3 This section intentionally left blank.

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, 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.

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.

To the Company:

Sierra Power Resources
6100 Neil Road
Reno, Nevada 89520-3150
Attention: General Counsel

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.

12.1 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.

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

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

                  (A) "Affiliate" shall have the meaning set forth in Rule 12b-2

promulgated under Section 12 of the Exchange Act.

(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 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 contest, 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 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 approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for 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.

Notwithstanding the foregoing, 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 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) Removal of Executive as Chief Executive Officer or Chairman of the Board: the assignment to the Executive of any duties substantially below the Executive's status as the most 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 across-the-board compensation deferral 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 is 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 to 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.

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

(P) "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.

(Q) "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 Affiliates, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities, or (iv) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.

(R) "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 or arises out of a potential Change in Control, is caused by, or results from another potential Change in Control.

(S) "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.

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

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

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

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

Sierra Pacific Resources

By:_______________________________
Name:
Title:

Exhibit 10(C)

THIS AGREEMENT, dated May 21, 2001, is made by and between Sierra Pacific Resources, a Nevada corporation (the "Company"), and Dennis D. Schiffel (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 disturbing 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:

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 Disability.

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 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.

6.1 Subject to Section 6.2 hereof, 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 theExecutive 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 or Potential 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 suchtermination was at the request or direction of a Person who has entered into agreement with the Company the consummation of which would constitute a Changein Control, (ii) the Executive terminates his employment for Good Reason priorto a Change in Control (whether or not a Change in Control ever occurs) and thecircumstance or event which constitutes Good Reason occurs at the request ordirection 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 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 unless 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,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 three 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 incentive award applicable to the Executive pursuant to any annual 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.

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) thirty-six (36) 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 or, if higher, during 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 thirty-six (36) 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.

(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) of 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.

6.4 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.

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).

benefits, by offset against any amount claimed to be owed by the Executive to the Company, or otherwise.

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.

To the Company:

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

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.

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

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

(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

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 contest, 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

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 juridiction over the matter approve a plan of complete liquidation or dissolution of the Company or there is consummated an agreement for or regulatory agency having juridiction over the matter approve a plan 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.

Notwithstanding the foregoing, except for Sections 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 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 the most 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 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 is 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 to 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.

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

(P) "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.

(Q) "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 Affiliates, (iii) an underwriter temporarily holding securities pursuant to an offering of such securities, or (iv) a corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.

(R) "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) the Board adopts a resolution to the effect that, for purposes of this Agreement, a Potential Change in Control has occurred.

(S) "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.

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

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

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

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

Sierra Pacific Resources

By:____________________________________
Name:
Title:

Exhibit 10(D)

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:

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

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

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.

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.

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

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.

(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.

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.

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).

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.

9.1 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.

To the Company:

Sierra Power Resources
6226 West Sahara Avenue
Las Vegas, Nevada 89146

Attention: General Counsel

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.

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

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

(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

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

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

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

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.

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

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).

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

Sierra Pacific Resources

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

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.

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
                                                                           ----

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

             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

     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

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

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

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

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.

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

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

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

====================================================================================================================
                               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
====================================================================================================================
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
--------------------------------------------------------------------------------------------------------------------

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:

====================================================================================================================
                               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
====================================================================================================================
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%
--------------------------------------------------------------------------------------------------------------------

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

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.

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.

                                   -- ----
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.

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.

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.

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).

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

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").

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.

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.

ARTICLE II
THE CREDITS

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.

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.

(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

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.

(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

(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).

(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.

(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.

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

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.

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:

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.

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.

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.

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.

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

(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.

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

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.

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.

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.

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.

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.

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

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.

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.

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

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.

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.

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.

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).

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.