EXHIBIT 10.3
Edison International
Director Deferred Compensation Plan
As Restated
Effective January 1, 1998
Contingent Upon Shareholder Approval
of the Equity Compensation Plan on April 16, 1998
EDISON INTERNATIONAL
DIRECTOR DEFERRED COMPENSATION PLAN
TABLE OF CONTENTS
Section Title Page
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ARTICLE 1 DEFINITIONS 1
ARTICLE 2 PARTICIPATION 4
2.1 Participant Election 4
2.2 Annual Deferral 4
2.3 Continuation of Participation 4
ARTICLE 3 DIRECTOR DEFERRALS 4
3.1 Participation Election 4
3.2 Minimum Annual Deferral 5
3.3 Maximum Annual Deferral 5
3.4 Deferred Stock Units 5
3.5 Vesting 5
ARTICLE 4 DEFERRAL ACCOUNTS 5
4.1 Deferral Accounts 5
4.2 Timing of Credits 5
ARTICLE 5 RETIREMENT BENEFITS 6
5.1 Amount 6
5.2 Form of Retirement Benefits 7
5.3 Commencement of Benefits 7
5.4 Small Benefit Exception 7
ARTICLE 6 TERMINATION BENEFITS 7
6.1 Amount 7
6.2 Form of Termination Benefits 8
ARTICLE 7 SURVIVOR BENEFITS 8
7.1 Pre-Retirement Survivor Benefit 8
7.2 Post-Retirement Survivor Benefit 8
7.3 Post-Termination Survivor Benefit 9
7.4 Changing Form of Benefit 9
7.5 Small Benefit Exception 9
ARTICLE 8 CHANGE OF CONTROL 9
EDISON INTERNATIONAL
DIRECTOR DEFERRED COMPENSATION PLAN
TABLE OF CONTENTS
Section Title Page
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ARTICLE 9 SCHEDULED AND UNSCHEDULED WITHDRAWALS 9
9.1 Scheduled Withdrawals 9
9.2 Unscheduled Withdrawals 10
ARTICLE 10 CONDITIONS RELATED TO BENEFITS
10.1 Nonassignability 11
10.2 Financial Hardship Distribution 11
10.3 No Right to Assets 11
10.4 Protective Provisions 11
10.5 Withholding 11
ARTICLE 11 PLAN ADMINISTRATION 12
ARTICLE 12 BENEFICIARY DESIGNATION 12
ARTICLE 13 AMENDMENT OR TERMINATION OF PLAN 13
13.1 Amendment of Plan 13
13.2 Termination of Plan 13
13.3 Amendment or Termination After Change of Control 13
13.4 Exercise of Power to Amend or Terminate 13
13.5 Constructive Receipt Termination 13
ARTICLE 14 CLAIMS AND REVIEW PROCEDURES 14
14.1 Claims Procedure 14
14.2 Review Procedure 14
14.3 Dispute Arbitration 14
ARTICLE 15 MISCELLANEOUS 16
15.1 Successors 16
15.2 Trust 16
15.3 Service Not Guaranteed 16
15.4 Gender, Singular and Plural 16
15.5 Captions 16
15.6 Validity 16
15.7 Waiver of Breach 17
15.8 Applicable Law 17
15.9 Notice 17
EDISON INTERNATIONAL
DIRECTOR DEFERRED COMPENSATION PLAN
Restated Effective January 1, 1998
PREAMBLE
Edison International Director Deferred Compensation Plan benefits are available
to Eligible Directors of Edison International and its participating affiliates.
Amounts of compensation deferred by Participants pursuant to this Plan accrue as
liabilities of the participating Affiliate at the time of the deferral under the
terms and conditions set forth herein. By electing to defer compensation under
the Plan, Participants consent to Edison International sponsorship of the Plan,
but acknowledge that Edison International is not a guarantor of the benefit
obligations of other participating Affiliates. Each participating Affiliate is
responsible for payment of the accrued benefits under the Plan with respect to
its own Eligible Directors subject to the terms and conditions set forth herein.
ARTICLE 1
DEFINITIONS
Capitalized terms in the text of the Plan are defined as follows:
Administrator means the Compensation and Executive Personnel Committee of the
Board of Directors of the Company.
Affiliate means Edison International or any corporation or entity which (i)
along with Edison International, is a component member of a "controlled group of
corporations" within the meaning of Section 414(b) of the Code, and (ii) has
approved the participation of its directors in the Plan.
Annual Deferral means the amount of Compensation which the Participant elects to
defer for a Plan Year pursuant to Articles 2 and 3 of the Plan.
Beneficiary means the person or persons or entity designated as such in
accordance with Article 12 of the Plan.
Board means the Board of Directors of Edison International.
Change of Control means either: (i) the dissolution or liquidation of Edison
International or a Company; (ii) a reorganization, merger or consolidation of
Edison International or a Company with one or more corporations as a result of
which Edison
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International or a Company is not the surviving corporation; (iii) approval by
the stockholders of Edison International or a Company of any sale, lease,
exchange or other transfer (in one or a series of transactions) of all or
substantially all of the assets of Edison International or a Company; (iv)
approval by the stockholders of Edison International or a Company of any merger
or consolidation of Edison International or a Company, in which the holders of
voting stock of Edison International or a Company immediately before the merger
or consolidation will not own 50% or more of the outstanding voting shares of
the continuing or surviving corporation immediately after the merger or
consolidation; or (v) a change of at least 51% (rounded to the next whole
person) in the membership of the Board of Directors of Edison International or a
Company within a 24-month period, unless the election or nomination for election
by stockholders of each new director within the period was approved by the vote
of at least 85% (rounded to the next whole person) of the directors then still
in office who were in office at the beginning of the twenty-four-month period,
except that any replacement of directors who are employees of Edison
International or a Company, with other employees of Edison International or a
Company, will be disregarded and not be considered a change in membership.
Notwithstanding the foregoing, any reorganization, merger or consolidation of a
Company with Edison International or another Company will be disregarded and not
be considered a Change of Control.
Code means the Internal Revenue Code of 1986, as amended.
Company means the Affiliate the Participant serves as a director.
Compensation means the sum of the all retainers and meeting fees which would be
paid to a Participant as an Eligible Director for the Plan Year before
reductions for deferrals under the Plan.
Crediting Rate means the rate at which interest will be credited to Participant
Deferral Accounts. The rate will be determined annually in advance of the Plan
Year and will be equal to 120 percent of the Index Rate. Edison International
reserves the right to prospectively change the Crediting Rate or formula.
Deferral Account means the notional account comprised of Compensation deferrals
and Deferred Stock Units established for record keeping purposes for a
Participant pursuant to Article 5 of the Plan.
Deferral Period means the Plan Year covered by a valid Participation Election
previously submitted by a Participant, or in the case of a newly eligible
Participant, the balance of the Plan Year following the date of the
Participation Election.
Deferred Stock Unit means a bookkeeping entry linked to shares of Edison
International Common Stock on a one-for-one basis. Deferred Stock Units may be
credited to a Participant's account as a result of an award under the Equity
Compensation Plan or Dividend Equivalents on such an award.
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Dividend Equivalent means an amount equal to the dividend declared by the Board
on one share of Edison International common stock for any calendar quarter.
Eligible Director means a non-employee director of an Affiliate who (i) is a
U.S. director or an expatriate who is based and paid in the U.S., and (ii) is
designated by the Company as eligible to participate in the Plan (subject to the
restrictions in Article 8 and Section 10.2 of the Plan).
Financial Hardship means an unexpected and unforeseen financial disruption
arising from an illness, casualty loss, sudden financial reversal, or other such
unforeseeable occurrence as determined by the Administrator or its designee.
Needs arising from foreseeable events such as the purchase of a residence or
education expenses for children will not, alone, be considered a Financial
Hardship.
Index Rate means the 120-month average rate of 10-year U.S. Treasury Notes
determined for any Plan Year as of October 15th of the prior year.
Participant means an Eligible Director who has elected to participate and has
completed a Participation Election pursuant to Section 2.1 of the Plan or has
received an award of Deferred Stock Units under the Edison International Equity
Compensation Plan which has been credited under this Plan.
Participation Election means the Participant's written election to defer
Compensation under the Plan submitted on the form prescribed by the
Administrator for that purpose.
Plan means the Edison International Director Deferred Compensation Plan.
Plan Year means the calendar year.
Retirement means a separation from service after attaining age 55 with at least
5 years of service.
Scheduled Withdrawal means a distribution of all or a portion of the entire
amount of Annual Deferrals and earnings credited to the Participant's
Compensation Deferral Account as elected by the Participant pursuant to the
provisions of Article 9 of the Plan.
Termination for Cause means the Termination of Service of the Participant upon
willful failure by the Participant to substantially perform his or her duties
for the Company or the willful engaging by the Participant in conduct which is
injurious to the Company, monetarily or otherwise.
Termination of Service means the voluntary or involuntary cessation of the
Participant's service as a member of the Board of Directors of a Company for any
reason other than Retirement or death. Termination of Service will not be deemed
to have occurred for purposes of this Plan if the Participant continues to serve
on the
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Board of Directors of another participating Affiliate, or commences such service
within 30 days.
Unscheduled Withdrawal means a distribution of all or a portion of the entire
amount of Annual Deferrals and earnings credited to the Participant's
Compensation Deferral Account as requested by the Participant pursuant to the
provisions of Article 9 of the Plan.
Valuation Date means the last day of the month in which Termination of Service,
Retirement or death occurs, or the day before a Scheduled Withdrawal or
Unscheduled Withdrawal occurs.
ARTICLE 2
PARTICIPATION
2.1 Commencement
(a) An Eligible Director will become a Participant in the Plan on the first day
of the month coincident with or next following the date the director becomes an
Eligible Director, provided the Eligible Director has submitted to the
Administrator a Participation Election prior to that date. Except for directors
who become newly eligible during the Plan Year, the Participation Election must
be submitted to the Administrator during the enrollment period designated by the
Administrator which will always be prior to the commencement of the Plan Year.
(b) An Eligible Director will also become a Participant upon any award of
Deferred Stock Units made under the Edison International Equity Compensation
Plan and credited to this Plan.
2.2 Annual Deferral
Subject to the restrictions in Article 3, the Eligible Director will designate
his or her Annual Deferral for the covered Plan Year on the Participation
Election.
2.3 Continuation of Participation
Participation will continue as long as the Participant has a Deferral Account
balance under the Plan.
ARTICLE 3
DIRECTOR DEFERRALS
3.1 Participation Election
Eligible Directors may elect to make an Annual Deferral under the Plan by
submitting a Participation Election during the applicable enrollment period. The
Participation Election will designate the percentage of Compensation, in whole
percentage
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increments, that the Participant wishes to defer pursuant to the terms of the
Plan. Once made, a Participation Election will continue to apply for subsequent
Deferral Periods unless the Participant submits a new Participation Election
form during a subsequent enrollment period changing the deferral amount or
revoking the existing election. A Participation Election may be revoked by the
Participant upon 30 days written notice to the Administrator; however, such
Participant will be ineligible to make an Annual Deferral under the Plan for the
following Plan Year.
3.2 Minimum Annual Deferral
The minimum Annual Deferral for a Plan Year is 10% of the Participant's
Compensation.
3.3 Maximum Annual Deferral
The maximum Annual Deferral for a Plan Year is 100% of the Participant's
Compensation.
3.4 Deferred Stock Units
The Company will credit the Participant's account with any Deferred Stock Unit
award approved by the Board pursuant to the Equity Compensation Plan.
3.5 Vesting
Amounts deferred under this Article 3 and any earnings thereon will be 100%
vested at all times.
ARTICLE 4
DEFERRAL ACCOUNTS
4.1 Deferral Accounts
Solely for record keeping purposes, the Administrator will maintain Deferral
Accounts for Compensation and Deferred Stock Units for each Participant with
such subaccounts as the Administrator or its record keeper find necessary or
convenient in the administration of the Plan.
4.2 Timing of Credits
(a) Annual Deferrals. The Administrator will credit the Annual Deferrals to the
Participant's Compensation Deferral Account at the time such amounts would
otherwise have been paid to the Participant but for the Participation Election.
(b) Deferred Stock Units. The Administrator will credit Deferred Stock Units to
the Participant's Deferred Stock Unit Deferral Account as of the effective date
of any award of Deferred Stock Units under the Equity Compensation Plan.
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(c) Earnings Crediting Dates.
(i) The Administrator will credit interest at the Crediting Rate to
the Participant's Compensation Deferral Account on a daily basis,
compounded annually.
(ii) The Administrator will credit a Dividend Equivalent for each
Deferred Stock Unit credited to the Participant's Deferred Stock
Unit Deferral Account on the Edison International common stock
ex-dividend date each quarter. Dividend Equivalents so credited
will be converted into additional Deferred Stock Units based on
the closing price of Edison International Common Stock on that
date as reported in the Western Edition of the Wall Street
Journal. Fractional Dividend Equivalents and Deferred Stock Units
will be credited.
(d) Statement of Accounts. The Administrator will periodically provide to each
Participant a statement setting forth the balance of the Deferral Account
maintained for the Participant.
ARTICLE 5
RETIREMENT BENEFITS
5.1 Amount
(a) Deferred Compensation. Upon Retirement, the Company will pay to the
Participant a retirement benefit in the form provided in Section 5.2(a), based
on the balance of the Compensation Deferral Account as of the Valuation Date. If
paid as a lump sum, the retirement benefit will be equal to the Compensation
Deferral Account balance. If paid in installments, the installments will be paid
in amounts that will amortize the Compensation Deferral Account balance with
interest credited at the Crediting Rate over the period of time benefits are to
be paid. For purposes of calculating installments, the Compensation Deferral
Account will be valued as of December 31 each year, and the subsequent
installments will be adjusted for the next Plan Year according to procedures
established by the Administrator to reflect changes in the Crediting Rate.
(b) Deferred Stock Units. Upon Retirement, the Company will pay to the
Participant a retirement benefit in the form provided in Section 5.2(b), based
on the balance of the Deferred Stock Unit Deferral Account as of the Valuation
Date. If paid as a lump sum, the retirement benefit will be equal to the
Deferred Stock Unit Deferral Account balance. If paid in installments, the
installments will be paid in amounts that will amortize the Deferred Stock Unit
Deferral Account balance with Dividend Equivalents credited over the period of
time benefits are to be paid. For purposes of calculating installments, the
Deferred Stock Unit Deferral Account will be valued as of December 31 each year,
and the subsequent installments will be adjusted for the next Plan Year
according to procedures established by the Administrator to reflect any changes
in the Dividend Equivalent crediting rate.
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5.2 Form of Retirement Benefits
(a) Compensation Deferrals. The Participant may elect on the Participation
Election form to have the retirement benefit attributable to Compensation
deferrals paid in cash:
(i) In a lump sum,
(ii) In installments paid monthly over a period of 60, 120, or 180
months, or
(iii) In a lump sum of a portion of the Deferral Account upon
Retirement with the balance in installments paid monthly over a
period of 60, 120, or 180 months.
If no valid election is made, the Administrator will pay the retirement benefit
in installments over a 180 month period. Participants may change the form of
payout by written election filed with the Administrator; provided, however, that
if the Participant files the election less than 13 months prior to the date of
Retirement, the payout election in effect 13 months prior to the date of
Retirement will govern.
(b) Deferred Stock Units. The balance in the Deferred Stock Unit Deferral
Account will be paid in cash in a lump sum. At least six months prior to
retirement, the Participant may request distribution in monthly installments
over 5, 10, or 15 years subject to approval of the Board.
5.3 Commencement of Benefits
Payments will commence within 60 days after the date the Participant retires, or
attains age 55, whichever is later.
5.4 Small Benefit Exception
Notwithstanding the foregoing, the Administrator may, in its sole discretion:
(a) pay the benefits in a single lump sum if the sum of all benefits payable to
the Participant is less than or equal to $3,500.00, or
(b) reduce the number of installments elected by the Participant to 120 or 60 if
necessary to produce a monthly benefit of at least $300.00.
ARTICLE 6
TERMINATION BENEFITS
6.1 Amount
No later than 60 days following a Termination of Service, the Administrator will
pay to the Participant a termination benefit as of the Valuation Date equal to
(i) the balance of the Compensation Deferral Account, and (ii) the balance of
the Deferred Stock Unit Deferral Account.
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6.2 Form of Termination Benefits
(a) The Administrator will pay the Compensation Deferral Account termination
benefits in a single lump sum cash payment unless the Participant has previously
elected payment to be made in three annual installments. Installments paid under
this Section 6.2(a) will include interest at the Index Rate and will be
redetermined annually to reflect adjustments in that rate.
(b) The Administrator will pay the Deferred Stock Unit Deferral Account
termination benefit in a single lump sum cash payment.
(c) Notwithstanding the foregoing, any Termination for Cause will result in an
single lump sum cash payment.
ARTICLE 7
SURVIVOR BENEFITS
7.1 Pre-Retirement Survivor Benefit
If the Participant dies while actively serving on the board of directors of an
Affiliate, the Administrator will pay a pre-retirement survivor benefit to the
Participant's Beneficiary. With respect to the Compensation Deferral Account,
the Administrator will pay a lump sum in cash or commence monthly installments
in accordance with the Participant's prior election within 60 days after the
Participant's death. The payment(s) will be based on the Participant's
Compensation Deferral Account balance as of the Valuation Date; provided
however, that if the Participant's death occurs within ten years of (i) his or
her initial Plan participation date, or (ii) January 1, 1995, whichever is
later, then the Beneficiary's payment(s) will be based on twice the
Participant's Compensation Deferral Account balance as of the Valuation Date.
With respect to Deferred Stock Units, the Administrator will pay a lump sum in
cash based on the Deferred Stock Unit Deferral Account balance as of the
Valuation Date within 60 days after the Participant's death. No doubling will
apply to the Deferred Stock Unit Deferral Account.
7.2 Post-Retirement Survivor Benefit
If the Participant dies after Retirement, the Administrator will pay a
post-retirement survivor benefit to the Participant's Beneficiary in an amount
equal to the remaining benefits payable to the Participant from the Compensation
Deferral Account under the Plan over the same period the benefits would have
been paid to the Participant; provided however, if the Participant's death
occurs within ten years of (i) his or her initial Plan participation date, or
(ii) January 1, 1995, whichever is later, then the Beneficiary's death benefit
will be based on twice the Participant's Compensation Deferral Account balance
as of the Valuation Date. In the event the Deferred Stock Unit Deferral Account
Balance has not yet been paid to the Participant, the Administrator will pay a
lump sum in cash as of the Valuation Date within 60 days after
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the Participant's death. No doubling will apply to the Deferred Stock Unit
Deferral Account.
7.3 Post-Termination Survivor Benefit
It the Participant dies following Termination of Service, but prior to the
payment of all benefits under the Plan, the Beneficiary will be paid the
remaining balance in the Participant's Deferral Account in a lump sum. No double
benefit will apply.
7.4 Changing Form of Benefit
Beneficiaries may petition the Administrator once, and only after the death of
the Participant, for a change in the form of survivor Benefits. The
Administrator may, in its sole and absolute discretion, choose to grant or deny
such a petition.
7.5 Small Benefit Exception
Notwithstanding the foregoing, the Administrator may, in its sole discretion:
(a) pay the benefits in a single lump sum if the sum of all benefits payable to
the Beneficiary is less than or equal to $3,500.00, or
(b) reduce the number of installments elected by the Participant to 120 or 60 if
necessary to produce a monthly benefit of at least $300.00.
ARTICLE 8
CHANGE OF CONTROL
Within two years after a Change of Control, any Participant or Beneficiary in
the case of an Edison International Change of Control, or the affected
Participants or Beneficiaries in the case of a Company Change of Control, may
elect to receive a distribution of the balance of the Compensation Deferral
Account. There will be a penalty deducted from the Compensation Deferral Account
prior to distribution pursuant to this Article 8 equal to 5% of the total
balance of the Compensation Deferral Account (instead of the 10% reduction
otherwise provided for in Section 9.2). If a Participant elects such a
withdrawal, any on-going Annual Deferral will cease, and the Participant may not
again be designated as an Eligible Employee until one entire Plan Year following
the Plan Year in which the withdrawal was made has elapsed.
ARTICLE 9
SCHEDULED AND UNSCHEDULED WITHDRAWALS
9.1 Scheduled Withdrawals
(a) Election. When making a Participation Election, a Participant may elect to
receive a distribution of a specific dollar amount or a percentage of the Annual
Deferral that will be made in the following Plan Year at a specified year in the
future when the Participant
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will still be an active director. Such an election must be made on an In-Service
Distribution Election Form and submitted concurrently with the Participation
Election. The election of a Scheduled Withdrawal will only apply to the Annual
Deferral and related earnings for that Deferral Period, but not to previous or
subsequent Annual Deferrals or related earnings. Elections under this Section
will be superseded by benefit payments due to the Retirement, Termination of
Service or death of the Participant.
(b) Timing and Form of Withdrawal. The year specified for the Scheduled
Withdrawal may not be sooner than the second Plan Year following the Plan Year
in which the deferral occurs. The Participant will receive a lump sum
distribution of the amount elected on January 1st of the Plan Year specified.
(c) Remaining Compensation Deferral Account. The remainder, if any, of the
Participant's Compensation Deferral Account will continue in effect and will be
distributed in the future according to the terms of the Plan.
(d) Deferred Stock Units. No Scheduled Withdrawal of Deferred Stock Units is
permitted.
9.2 Unscheduled Withdrawals
(a) Election. A Participant (or Beneficiary if the Participant is deceased) may
request in writing to the Administrator an Unscheduled Withdrawal of all or a
portion of the entire vested amount credited to the Participant's Compensation
Deferral Account, including earnings, which will be paid within 30 days in a
single lump sum; provided, however, that (i) the minimum withdrawal will be 25%
of the Compensation Deferral Account balance, (ii) an election to withdraw 75%
or more of the balance will be deemed to be an election to withdraw the entire
balance, and (iii) such an election may be made only once in a Plan Year.
(b) Withdrawal Penalty. There will be a penalty deducted from the Compensation
Deferral Account prior to an Unscheduled Withdrawal equal to 10% of the
Unscheduled Withdrawal. If a Participant elects such a withdrawal, any on-going
Annual Deferral will cease, and the Participant may not again be designated as
an Eligible Director until one entire Plan Year following the Plan Year in which
the withdrawal was made has elapsed.
(c) Small Benefit Exception. Notwithstanding any of the foregoing, if the sum of
all benefits payable to the Participant or Beneficiary who has requested the
Unscheduled Withdrawal is less than or equal to $3,500.00, the Administrator
may, in its sole discretion, elect to pay out the entire Compensation Deferral
Account (reduced by the 10% penalty) in a single lump sum.
(d) Deferred Stock Units. No Unscheduled Withdrawal of Deferred Stock Units is
permitted.
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ARTICLE 10
CONDITIONS RELATED TO BENEFITS
10.1 Nonassignability
The benefits provided under the Plan may not be alienated, assigned,
transferred, pledged or hypothecated by or to any person or entity, at any time
or any manner whatsoever. These benefits will be exempt from the claims of
creditors of any Participant or other claimants and from all orders, decrees,
levies, garnishment or executions against any Participant to the fullest extent
allowed by law. Notwithstanding the foregoing, the benefit payable to a
Participant may be assigned in full or in part, pursuant to a domestic relations
order of a court of competent jurisdiction.
10.2 Financial Hardship Distribution
A participant may submit a hardship distribution request to the Administrator in
writing setting forth the reasons for the request. The Administrator will have
the sole authority to approve or deny such requests. Upon a finding that the
Participant or the Beneficiary has suffered a Financial Hardship, the
Administrator may in its discretion, permit the Participant to cease any
on-going deferrals and accelerate distributions of benefits under the Plan in
the amount reasonably necessary to alleviate the Financial Hardship. If a
distribution is to be made to a Participant on account of Financial Hardship,
the Participant may not make deferrals under the Plan until one entire Plan Year
following the Plan Year in which a distribution based on Financial Hardship was
made has elapsed.
10.3 No Right To Assets
The benefits paid under the Plan will be paid from the general funds of the
Company, and the Participant and any Beneficiary will be no more than unsecured
general creditors of the Company with no special or prior right to any assets of
the Company for payment of any obligations hereunder. The Participant will have
no claim to benefits from any other Affiliate.
10.4 Protective Provisions
The Participant will cooperate with the Administrator by furnishing any and all
information requested by the Administrator, in order to facilitate the payment
of benefits hereunder, taking such physical examinations as the Administrator
may deem necessary and signing such consents to insure or taking such other
actions as may be requested by the Administrator. If the Participant refuses to
cooperate, the Administrator and the Employer will have no further obligation to
the Participant under the Plan.
10.5 Withholding
The Participant or the Beneficiary will make appropriate arrangements with the
Administrator for satisfaction of any federal, state or local income tax
withholding requirements and Social Security or other director tax requirements
applicable to the
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payment of benefits under the Plan. If no other arrangements are made, the
Administrator may provide, at its discretion, for such withholding and tax
payments as may be required.
ARTICLE 11
PLAN ADMINISTRATION
The Administrator will administer the Plan and interpret, construe and apply its
provisions in accordance with its terms and will provide direction and oversight
as necessary to management, staff, or contractors to whom day-to-day Plan
operations may be delegated. The Administrator will establish, adopt or revise
such rules and regulations as it may deem necessary or advisable for the
administration of the Plan. All decisions of the Administrator will be final and
binding.
ARTICLE 12
BENEFICIARY DESIGNATION
The Participant will have the right, at any time, to designate any person or
persons as Beneficiary (both primary and contingent) to whom payment under the
Plan will be made in the event of the Participant's death. The Beneficiary
designation will be effective when it is submitted in writing to the
Administrator during the Participant's lifetime on a form prescribed by the
Administrator.
The submission of a new Beneficiary designation will cancel all prior
Beneficiary designations. Any finalized divorce or marriage of a Participant
subsequent to the date of a Beneficiary designation will revoke such
designation, unless in the case of divorce the previous spouse was not
designated as Beneficiary, and unless in the case of marriage the Participant's
new spouse has previously been designated as Beneficiary. The spouse of a
married Participant must consent in writing to any designation of a Beneficiary
other than the spouse.
If a Participant fails to designate a Beneficiary as provided above, or if the
Beneficiary designation is revoked by marriage, divorce, or otherwise without
execution of a new designation, or if every person designated as Beneficiary
predeceases the Participant or dies prior to complete distribution of the
Participant's benefits, then the Administrator will direct the distribution of
the benefits to the Participant's estate. If a Beneficiary dies after
commencement of payments to the Beneficiary, a lump sum of any remaining
payments will be paid to that person's Beneficiary, if one has been designated,
or to the Beneficiary's estate.
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ARTICLE 13
AMENDMENT OR TERMINATION OF PLAN
13.1 Amendment of Plan
Subject to the terms of Section 13.3, Edison International may at any time amend
the Plan in whole or in part, provided, however, that the amendment (i) will not
decrease the balance of the Participant's Deferral Account at the time of the
amendment and (ii) will not retroactively decrease the applicable Crediting
Rates of the Plan prior to the time of the amendment. Edison International may
amend the Crediting Rates of the Plan prospectively, in which case the
Administrator will notify the Participant of the amendment in writing within 30
days after the amendment.
13.2 Termination of Plan
Subject to the terms of Section 13.3, Edison International may at any time
terminate the Plan. If Edison International terminates the Plan, the date of the
termination will be treated as the date of Termination of Service for the
purpose of calculating Plan benefits, and the benefits the Participant is
entitled to receive under the Plan will be paid to the Participant in a lump sum
within 60 days.
13.3 Amendment or Termination After Change of Control
Notwithstanding the foregoing, Edison International will not amend or terminate
the Plan without the prior written consent of affected Participants for a period
of two calendar years following a Change of Control and will not thereafter
amend or terminate the Plan in any manner which affects any Participant (or
Beneficiary of a deceased Participant) who commences receiving payment of
benefits under the Plan prior to the end of the two-year period following a
Change of Control.
13.4 Exercise of Power to Amend or Terminate
Edison International's power to amend or terminate the Plan will be exercisable
by the Board.
13.5 Constructive Receipt Termination
Notwithstanding anything to the contrary in this Plan, in the event the
Administrator determines that amounts deferred under the Plan have been
constructively received by Participants and must be recognized as income for
federal income tax purposes, the Plan will terminate and distributions will be
made to Participants in accordance with the provisions of Section 13.2 or as may
be determined by the Administrator. The determination of the Administrator under
this Section 13.5 will be binding and conclusive.
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ARTICLE 14
CLAIMS AND REVIEW PROCEDURES
14.1 Claims Procedure
The Administrator will notify a Participant in writing, within 90 days after his
or her written application for benefits, of his or her eligibility or
noneligibility for benefits under the Plan. If the Administrator determines that
a Participant is not eligible for benefits or full benefits, the notice will set
forth (1) the specific reasons for the denial, (2) a specific reference to the
provisions of the Plan on which the denial is based, (3) a description of any
additional information or material necessary for the claimant to perfect his or
her claim, and a description of why it is needed, and (4) an explanation of the
Plan's claims review procedure and other appropriate information as to the steps
to be taken if the Participant wishes to have the claim reviewed. If the
Administrator determines that there are special circumstances requiring
additional time to make a decision, the Administrator will notify the
Participant of the special circumstances and the date by which a decision is
expected to be made, and may extend the time for up to an additional 90-day
period.
14.2 Review Procedure
If a Participant is determined by the Administrator not to be eligible for
benefits, or if the Participant believes that he or she is entitled to greater
or different benefits, the Participant will have the opportunity to have the
claim reviewed by the Administrator by filing a petition for review with the
Administrator within 60 days after receipt of the notice issued by the
Administrator. Said petition will state the specific reasons which the
Participant believes entitle him or her to benefits or to greater or different
benefits. Within 60 days after receipt by the Administrator of the petition, the
Administrator will afford the Participant (and counsel, if any) an opportunity
to present his or her position to the Administrator orally or in writing, and
the Participant (or counsel) will have the right to review the pertinent
documents. The Administrator will notify the Participant of its decision in
writing within the 60-day period, stating specifically the basis of its
decision, written in a manner calculated to be understood by the Participant and
the specific provisions of the Plan on which the decision is based. If, because
of the need for a hearing, the 60-day period is not sufficient, the decision may
be deferred for up to another 60-day period at the election of the
Administrator, but notice of this deferral will be given to the Participant. In
the event of the death of the Participant, the same procedures will apply to the
Participant's Beneficiaries.
14.3 Dispute Arbitration
Notwithstanding the foregoing, and because it is agreed that time will be of the
essence in determining whether any payments are due to Participant or his or her
Beneficiary under the Plan, a Participant or Beneficiary may, if he or she
desires, submit any claim for payment under the Plan to arbitration. This right
to select arbitration will be solely that of the Participant or Beneficiary and
the Participant or Beneficiary may decide whether or not to arbitrate in his or
her discretion. The "right to select arbitration" is not mandatory on the
Participant or Beneficiary, and the Participant or Beneficiary may
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choose in lieu thereof to bring an action in an appropriate civil court. Once an
arbitration is commenced, however, it may not be discontinued without the mutual
consent of both parties to the arbitration. During the lifetime of the
Participant only he or she can use the arbitration procedure set forth in this
Section.
Any claim for arbitration may be submitted as follows: if a Participant or
Beneficiary has submitted a request to be paid under the Plan and the claim is
finally denied by the Administrator in whole or in part, the claim may be filed
in writing with an arbitrator of the Participant's or Beneficiary's choice who
is selected by the method described in the next four sentences. The first step
of the selection will consist of the Participant or Beneficiary submitting a
list of five potential arbitrators to the Administrator. Each of the five
arbitrators must be either (1) a member of the National Academy of Arbitrators
located in the State of California or (2) a retired California Superior Court or
Appellate Court judge. Within one week after receipt of the list, the
Administrator will select one of the five arbitrators as the arbitrator for the
dispute in question. If the Administrator fails to select an arbitrator within
one week after receipt of the list, the Participant or Beneficiary will then
designate one of the five arbitrators for the dispute in question.
The arbitration hearing will be held within seven days (or as soon thereafter as
possible) after the picking of the arbitrator. No continuance of said hearing
will be allowed without the mutual consent of Participant or Beneficiary and the
Administrator. Absence from or nonparticipation at the hearing by either party
will not prevent the issuance of an award. Hearing procedures which will
expedite the hearing may be ordered at the arbitrator's discretion, and the
arbitrator may close the hearing in his or her sole discretion when he or she
decides he or she has heard sufficient evidence to satisfy issuance of an award.
The arbitrator's award will be rendered as expeditiously as possible and in no
event later than one week after the close of the hearing.
In the event the arbitrator finds that the Administrator or the Company has
breached the terms of the Plan, he or she will order the Company to pay to
Participant or Beneficiary within two business days after the decision is
rendered the amount then due the Participant or Beneficiary, plus,
notwithstanding anything to the contrary in the Plan, an additional amount equal
to 20% of the amount actually in dispute. This additional amount will constitute
an additional benefit under the Plan. The award of the arbitrator will be final
and binding upon the Parties.
The award may be enforced in any appropriate court as soon as possible after its
rendition. The Administrator will be considered the prevailing party in a
dispute if the arbitrator determines (1) that the Administrator or the Company
has not breached the terms of the Plan and (2) the claim by Participant or his
or her Beneficiary was not made in good faith. Otherwise, the Participant or his
or her Beneficiary will be considered the prevailing party. In the event that
the Administrator is the prevailing party, the fee of the arbitrator and all
necessary expenses of the hearing (excluding any attorneys' fees incurred by the
Administrator) including stenographic reporter, if
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employed, will be paid by the losing party. In the event that the Participant or
his or her Beneficiary is the prevailing party, the fee of the arbitrator and
all necessary expenses of the hearing (including all attorneys' fees incurred by
Participant or his or her Beneficiary in pursuing his or her claim), including
the fees of a stenographic reporter, if employed, will be paid by the Company.
ARTICLE 15
MISCELLANEOUS
15.1 Successors
The rights and obligations of Edison International and the Companies under the
Plan will inure to the benefit of, and will be binding upon, the successors and
assigns of Edison International and the Companies, respectively.
15.2 Trust
The Companies will be responsible for the payment of all benefits under the
Plan. At their discretion, the Companies may establish one or more grantor
trusts for the purpose of providing for payment of benefits under the Plan. The
trust or trusts may be irrevocable, but a Company's share of the assets thereof
will be subject to the claims of the Company's creditors. Benefits paid to the
Participant from any such trust will be considered paid by the Company for
purposes of meeting the obligations of the Company under the Plan.
15.3 Service Not Guaranteed
Nothing contained in the Plan nor any action taken hereunder will be construed
as a contract of service or as giving any Participant any right to continue in
service as a director of Edison International or any other Affiliate.
15.4 Gender, Singular and Plural
All pronouns and variations thereof will be deemed to refer to the masculine,
feminine, or neuter, as the identity of the person or persons may require. As
the context may require, the singular may be read as the plural and the plural
as the singular.
15.5 Captions
The captions of the articles and sections of the Plan are for convenience only
and will not control or affect the meaning or construction of any of its
provisions.
15.6 Validity
If any provision of the Plan is held invalid, void or unenforceable, the same
will not affect, in any respect whatsoever, the validity of any other provisions
of the Plan.
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15.7 Waiver of Breach
The waiver by the Administrator of any breach of any provision of the Plan by
the Participant will not operate or be construed as a waiver of any subsequent
breach by the Participant.
15.8 Applicable Law
The Plan will be governed and construed in accordance with the laws of
California.
15.9 Notice
Any notice or filing required or permitted to be given to the Administrator
under the Plan will be sufficient if in writing and hand-delivered, or sent by
first class mail to the principal office of Edison International, directed to
the attention of the Administrator. The notice will be deemed given as of the
date of delivery, or, if delivery is made by mail, as of the date shown on the
postmark.
IN WITNESS WHEREOF, Edison International has restated this Plan effective the
1st day of January, 1998.
Edison International
Lillian R. Gorman
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Lillian R. Gorman, Vice President