ENOVA CORPORATION
1997 DEFERRED COMPENSATION AGREEMENT
FOR OFFICERS #3
THIS AGREEMENT is made and entered into this ___ day of December,
1996, by and between Enova Corporation or any of its subsidiaries
(hereinafter "Company") and ____________________ (hereinafter
"Officer"), an elected Officer of Company.
WITNESSETH:
WHEREAS, Company desires to provide Officer with the opportunity to
defer base compensation and bonus that is payable for services to be
rendered after the date of this Agreement and which, as a result of
amendments to the Internal Revenue Code ("Code") made by the Tax Reform
Act of 1986 ("1986 Tax Act"), cannot be contributed on Officer's behalf
as Pretax Contributions to the San Diego Gas & Electric Company Savings
Plan, which has been adopted by Company ("Savings Plan"); and
WHEREAS, Company desires to match, as an additional Company
contribution, a percentage of the Officer's base compensation and bonus
deferred pursuant to this Agreement; and
WHEREAS, Officer and Company desire that the payment of a portion
of Officer's base compensation and bonus and the additional matching
contribution be deferred pursuant to the terms and provisions of this
Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. This Agreement shall be effective upon its execution by Company
and Officer with respect to base compensation and bonus which would
otherwise be payable to Officer for services rendered after such
execution and shall continue in effect until this Agreement is
terminated as provided herein. Officer shall be eligible to enter into
this Agreement only if Officer has elected the maximum Basic
Contribution under the Savings Plan for which Officer is eligible.
2. Company shall credit to an account on Company's books, in
Officer's name, that percentage of Officer's 1997 base compensation (in
equal biweekly installments of whole dollar amounts) and 1998 bonus
otherwise payable to Officer as may be specified by Officer in this
Agreement's Election Form. The amount credited under this paragraph 2
may not exceed the percentage of Officer's 1997 base compensation and
1998 bonus that may be contributed as Pretax Contributions or After-tax
Contributions under the terms of the Savings Plan (determined prior to
any reduction of such percentage required under applicable law), reduced
by any amount contributed by Officer as After-tax Contributions or on
Officer's behalf as Pretax Contributions to the Savings Plan. Further,
the amount credited under this paragraph 2 shall be limited to an amount
which, when added to Company's matching contribution under paragraph 3
of this Agreement and all allocations to his or her accounts under the
Savings Plan, does not exceed the maximum amount that could have been
allocated to Officer's Savings Plan accounts pursuant to Section 415 of
the Code, as in effect prior to the enactment of the 1986 Tax Act. For
purposes of this paragraph 2, "base compensation and bonus" shall
include Officer's Pretax Contributions to the Savings Plan. Company
shall have the sole and complete authority to determine the maximum
amount that may be credited under this paragraph 2.
3. In addition, as amounts are credited to Officer's account under
paragraph 2, Company shall also credit to Officer's account, as a
matching contribution, an amount equal to the Company Matching
Contributions that would have been contributed on Officer's behalf to
the Savings Plan, if any, (reduced by Matching Contributions actually
made to the Savings Plan for Officer) under the provisions of the Code
prior to enactment of the 1986 Tax Act, if the amount deferred under
paragraph 2 had been contributed to the Savings Plan as Pretax
Contributions or After-tax Contributions.
4. There shall be credited to Officer's account an additional
amount equal to seven and eighty-five one-hundreths percent (7.85%) per
annum computed on the balance in Officer's account as of the end of each
month. Company reserves the right to increase or decrease from time to
time such percentage credited with respect to amounts to be credited
under paragraphs 2 and 3 to the account after the date of such increase
or decrease, provided that upon a "change-in-control" (as defined in the
Enova Corporation 1986 Long-Term Incentive Plan) no decrease will result
in a percentage credited under the previous sentence of less than the
last published interest rate shown in Xxxxx'x Average of Yields on
Public Utility Bonds for a utility having a rating equivalent to
Company.
5. All amounts credited to Officer's account pursuant to
paragraphs 2, 3, and 4 hereof shall be paid to Officer upon his or her
termination of services as an Officer in the form and over the period
specified by Officer on this Agreement's Election Form; provided,
however, the Company's Board of Directors or Executive Compensation
Committee may, in its sole discretion, provide instead for payment of
the amount in Officer's account in a form and over a period determined
by such Board or Committee except that the Board or Committee's
authority and discretion to change the form or period of distribution
shall terminate upon such a "change-in-control."
6. In the event of Officer's death after installment payments to
Officer have commenced hereunder, installment payments shall continue to
be paid to the person(s) specified by Officer on the Election Form for
the remainder of the period selected by Officer on the Election Form.
In the event of Officer's death before any payment has been made under
this Agreement, Officer's account shall be distributed or commence to be
distributed, as soon as administratively practicable after Officer's
death, to the person(s) specified by Officer on this Agreement's
Election Form in the form and over the period selected on such Election
Form. The Board or Committee may, in its sole discretion, provide
instead for payment of the amount in Officer's account to Officer's
beneficiary in a form and over a period determined by the Board or
Committee except that the Board or Committee's authority and discretion
to change the form or period of distribution shall terminate upon such a
"change-in-control."
If Officer's spouse is the beneficiary, the annual amount of any
installment payments under this paragraph 6 shall at least equal the
entire annual income earned by the account and if the spouse dies prior
to distribution of all amounts in Officer's account, all undistributed
income on such account shall be distributed to the spouse's estate.
Upon the death of Officer's beneficiary, the balance in Officer's
account (after the application of the previous sentence, if the spouse
is the beneficiary) shall be distributed to the person(s) designated by
the beneficiary on a form provided by Company or, if no designation is
made, to the beneficiary's estate.
7. All amounts credited to Officer's account pursuant to
paragraphs 2, 3 and 4 hereof may be used to purchase common stock of
Enova Corporation or other equity securities, subject to the following
conditions:
a. All such purchases must be made through a stock equivalent
tracking device, a "rabbi trust" or other similar instrument that causes
the deferred amount not to become taxable;
b. Equity securities of other entities may be purchased only
if the Officer has met or is expected to meet, under the normal course
of events, the Company's Enova Corporation stock ownership requirement;
c. If the Officer becomes subject to a higher Enova
Corporation stock ownership requirement, the Officer may retain any then
current investment in equity securities of other entities, but shall not
make additional purchases of other equity securities until the higher
Enova Corporation stock ownership requirement has been met or is
expected to be met under the normal course of events; and
d. All such purchases must be made in accordance with
applicable Company procedures, as they may be amended from time to time.
8. No amounts credited to Officer's account may be assigned,
transferred, encumbered, or made subject to any legal process for the
payment of any claim against Officer, Officer's spouse or other
beneficiary. In no event shall Officer, Officer's spouse, or other
beneficiary have the right to recover any amount credited to Officer's
account other than in accordance with this Agreement.
9. Nothing contained in this Agreement and no action taken
pursuant to the provisions of this Agreement shall create or be
construed to create a trust of any kind, or a fiduciary relationship
between Company and Officer or any other person. To the extent that any
person acquires a right to receive payments from Company under this
Agreement, such right shall be no greater than the right of any
unsecured general creditor of Company. Except as provided in paragraph
7 of this Agreement, title to and beneficial ownership of any assets,
whether cash or investments, which Company may earmark to pay the
deferred compensation hereunder, shall at all times remain assets of
Company and neither Officer nor any other person shall, under this
Agreement, have any property interest whatsoever in any specific assets
of Company.
10. The existence of this Agreement shall not confer upon Officer
the right to continue to serve as an Officer for any period of time.
11. This Agreement shall be deemed to modify any provisions in an
employment agreement between Officer and Company pertaining to the
timing of payment of base compensation and bonus and, in the event of
any conflict between this Agreement and such provisions of the
employment agreement, this Agreement shall control.
12. This Agreement may be terminated by Company upon thirty days'
written notice to Officer. This Agreement will also terminate upon
Officer's filing of an election of a Basic Contribution percentage which
is less than the maximum for which he or she is eligible under the
Savings Plan. Termination of the Agreement shall be applicable only
with respect to base compensation and bonus payable to Officer on and
after the first day of the calendar year following the date of
termination. Funds previously deferred and credited (and income earned
on such funds) will continue to be governed by the applicable year's
Officer's Deferred Compensation Agreement Election Form and Section 4 of
this Agreement.
13. Officer acknowledges that Officer has been advised that
Officer may confer with and seek advice from a tax or financial advisor
of Officer's choice concerning this deferral. Officer further
acknowledges that Officer has not received tax advice from Company nor
has Officer relied upon information provided by Company in electing to
make this deferral.
IN WITNESS WHEREOF, this Agreement has been executed on the day
and year written above.
OFFICER COMPANY
_______________________________ By ____________________________
Signature of Officer Company _______________________
Title _________________________
