                                                                    Exhibit 10.1

February 27, 2003

Jim Levine
4817 N. Greentree Dr. E.
Litchfield Park, AZ  85340

Dear Jim:

As a  supplement  to your  Employment  Agreement  dated  October  11,  2002  the
following  clarifies the benefit items that the Pinnacle West Board has approved
for you:

     o    Pension - Add 5 years of service  effective 1/2002 and each subsequent
          year 3% will be added to the  percent of average  monthly  wage you'll
          receive until the 70% benefit is reached:

          -    18  years of  service  in 2002  (3%x10  - 30% + 2%x8 = 16%),  46%
               pension benefit

          -    2002     +5 years at 2%     46%
          -    2002     +3%                49%
          -    2003     +3%                52%
          -    2004     +3%                55%  age 55
          -    2005     +3%                58%
          -    2006     +3%                61%
          -    2007     +3%                64%
          -    2008     +3%                67%
          -    2009     +3%                70%  age 60

     o    Additional  years of service will count towards the percentage of your
          premium costs for retiree medical coverage.

If you have any questions, please feel free to contact me.

                                        Sincerely,

                                        William J. Post

WP/DO/ch
cc: Armando Flores

