ENOVA CORPORATION
1998 DEFERRED COMPENSATION AGREEMENT #1
(1998 BASE COMPENSATION)
(1998 BONUS)
THIS AGREEMENT is made and entered into this ______ day of
December, 1997, by and between Enova Corporation or any of its
subsidiaries, (hereinafter "Company") and ________________________
(hereinafter "Participant"), an employee of Company.
WITNESSETH:
WHEREAS, in addition to 1998 base compensation, incentive
compensation payable in the form of a cash bonus may be paid to
Participant in 1998 or 1999 for outstanding performance in 1998
("Bonus");
WHEREAS, Participant and Company desire that the payment of
said 1998 base compensation and/or Bonus to Participant be
deferred, pursuant to the terms and provisions of this Agreement;
and
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. This Agreement shall be effective on the first date after
its execution upon which Participant's Bonus would otherwise be
payable to Participant for outstanding performance in 1998 and
shall continue in effect until this Agreement is terminated as
provided herein.
2. Company shall credit to an account on Company's books, in
Participant's name, that portion of such Participant's Bonus
otherwise payable to Participant as may be specified by
Participant on an Election Form submitted to Company
simultaneously with the execution of this Agreement. If a
Participant has elected to defer 100% of such Participant's Bonus
(pursuant to Deferred Compensation Agreements for Participants #1
and #3) and the Participant is also participating in the Savings
Plan of San Diego Gas & Electric, which has been adopted by the
Company, to the maximum extent permissible, such Participant may
also elect to defer, and Company shall credit to the Participant's
account, a portion of such Participant's base compensation (in
equal bi-weekly installments of whole dollar amounts).
3. There shall be credited to Participant's account an
additional amount equal to eight and sixty-eight one-hundreths
percent (8.68%) per annum computed on the balance in Participant's
account as of the end of each month; provided, however, that
Company reserves the right to increase or decrease from time to
time such amounts to be credited 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) the percentage used shall not decrease to
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less than the last published percentage shown in Xxxxx'x Average
of Yields on Public Utility Bonds for a utility having a rating
equivalent to SDG&E.
4. All amounts credited to Participant's account pursuant to
paragraphs 2 and 3 hereof shall be paid to Participant on the
date(s) specified by Participant on this Agreement's Election
Form. In the event of Participant's death after installment
payments to Participant have commenced hereunder, installment
payments shall continue to be paid to the person(s) specified by
Participant on the Election Form for the remainder of the period
selected by Participant on this Agreement's Election Form. In the
event of Participant's death before any payment has been made
under this Agreement, Participant's account shall be distributed
or commence to be distributed, as soon as administratively
practicable after Participant's death, to the person(s) specified
by Participant on this Agreement's Election Form in the form and
over the period selected on such Election Form. The Company's
Board of Directors or Executive Compensation Committee may, in its
sole discretion, provide instead for payment of the amount in
Participant's account to Participant'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 Participant's spouse is the beneficiary, the annual
amount of any installment payments under this paragraph 4 shall at
least equal the entire annual income earned by the account and if
the spouse dies prior to distribution of all amounts in
Participant's account, all undistributed income on such account
shall be distributed to the spouse's estate. Upon the death of
Participant's beneficiary, the balance in Participant'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.
Notwithstanding the foregoing, a Participant (or former
Participant whose services have terminated, hereinafter referred
to in this paragraph as "Participant") may, at any time, elect to
withdraw all or a portion of the balance in the Participant's
account prior to the time such amount is otherwise due and
payable, subject to a withdrawal penalty (the amount to be
withdrawn prior to the application of the withdrawal penalty shall
be referred to as the "Gross Withdrawal Amount", which may not
exceed the balance of the account immediately prior to the
withdrawal). The Participant shall make this election by filing a
written notice with the Committee on a form provided by the
Committee. Within thirty days following the Committee's receipt
of such notice, an amount equal to 90% of the Gross Withdrawal
Amount (less applicable withholding tax) shall be paid to the
Participant in a cash lump sum. Upon payment of such withdrawal,
(a) a withdrawal penalty equal to 10% of the Gross Withdrawal
Amount shall be permanently forfeited, and the Company shall have
no obligation to the Participant or the Participant's spouse or
beneficiary with respect to such forfeited amount and (b) the
Participant shall be ineligible to have any additional bonus or
base compensation amounts credited to the Participant's account
pursuant to this Agreement (or any subsequent Deferred
Compensation Agreement) for the balance of the calendar year of
withdrawal and the subsequent calendar year.
5. All amounts credited to Participant's account pursuant to
paragraphs 2 and 3 hereof may be used to purchase common stock of
Enova Corporation or other equity securities, subject to the
following conditions:
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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 Participant has met or is expected to meet, under the
normal course of events, the Company's Enova Corporation stock
ownership requirement;
c. If the Participant becomes subject to a higher Enova
Corporation stock ownership requirement, the Participant 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.
6. No amounts credited to Participant's account may be
assigned, transferred, encumbered, or made subject to any legal
process for the payment of any claim against Participant,
Participant's spouse or beneficiary. In no event shall
Participant, Participant's spouse or beneficiary have the right to
recover any amounts credited to Participant's account other than
in accordance with this Agreement.
7. 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 the Participant 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 5 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 the Participant nor any other person shall,
under this Agreement, have any property interest whatsoever in any
specific assets of Company.
8. The existence of this Agreement shall not confer upon any
Participant any right to continue to serve as an officer or
employee for any period of time.
9. This Agreement may be terminated by Company upon 30 days
written notice to the Participant. Such termination shall be
applicable only with respect to bonuses and/or base compensation
payable to Participant 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 Participant's Deferred
Compensation Agreement Election Form and paragraph 3 of this
Agreement.
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10. Participant acknowledges that Participant has been
advised that Participant may confer with and seek advice from a
tax or financial advisor of Participant's choice concerning this
deferral. Participant further acknowledges that Participant has
not received tax advice from Company nor has Participant 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.
PARTICIPANT COMPANY
______________________________ By ______________________________
Signature of Participant Company _________________________
Title _________________________
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